Exhibit 10.1

EXECUTION COPY

AMENDED AND RESTATED SALE AGREEMENT

This AMENDED AND RESTATED SALE AGREEMENT (this “Agreement”), dated as of
September 1, 2012, is by and among MORI SPC Series Corp., a Delaware special
purpose corporation (the “Seller”), and Marriott Vacations Worldwide Owner Trust
2011-1, a Delaware statutory trust (the “Issuer”), and their respective
permitted successors and assigns.

W I T N E S S E T H:

WHEREAS, the parties hereto desire to amend and restate the sale agreement,
dated as of September 1, 2011, as amended by Amendment No. 1 (the “Original Sale
Agreement”), by and among the Seller and the Issuer, and all actions required to
do so under Section 13 of the Original Sale Agreement have been taken;

WHEREAS, (i) on and after the Closing Date, from time to time, the Seller will
sell and the Issuer will purchase Timeshare Loans, and (ii) pursuant to that
certain second amended and restated indenture and servicing agreement, dated as
of September 1, 2012 (the “Indenture and Servicing Agreement”), by and among the
Issuer, Marriott Ownership Resorts, Inc., a Delaware corporation, as servicer
(in such capacity, the “Servicer”) and Wells Fargo Bank, National Association, a
national banking association, as indenture trustee (in such capacity, the
“Indenture Trustee”) and back-up servicer (in such capacity, the “Back-up
Servicer”), the Issuer intends to pledge, among other things, such Timeshare
Loans to the Indenture Trustee to secure the Issuer’s Timeshare Loan Backed
Variable Funding Notes, Series 2011-1 (the “Notes”);

WHEREAS, the Seller may provide Qualified Substitute Timeshare Loans for
Timeshare Loans previously sold to the Issuer hereunder; and

NOW, THEREFORE, in consideration of the mutual covenants set forth herein, and
for other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto covenant and agree as follows:

SECTION 1. Definitions; Interpretation. Capitalized terms used but not defined
herein shall have the meanings specified in “Standard Definitions” attached
hereto as Annex A.

SECTION 2. Acquisition of Timeshare Loans.

(a) Timeshare Loans. On each Funding Date or Transfer Date, in return for the
Timeshare Loan Acquisition Price for each of the Timeshare Loans to be sold on
such Funding Date or Transfer Date, as applicable, the Seller does hereby
transfer, assign, sell and grant to the Issuer, without recourse (except as
provided in Section 6 and Section 8 hereof), any and all of the Seller’s right,
title and interest in and to (i) each Timeshare Loan listed on the Schedule of
Timeshare Loans related to each Additional Timeshare Loan Supplement, (ii) the
Receivables in respect of such Timeshare Loans due on and after the related
Cut-Off Date, (iii) the related Timeshare Loan Files, (iv) all Related Security
in respect of each such Timeshare Loan, (v) all rights and remedies of the
Seller pursuant to the Purchase Agreement, and (vi) all income,

 

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payments, proceeds and other benefits and rights related to any of the foregoing
(the “Conveyed Timeshare Loan Assets”). The excess amount, if any, between the
Timeshare Loan Acquisition Price for a Timeshare Loan and the amount of cash
received by the Seller from the Issuer on the related Funding Date or Transfer
Date, as applicable, from the proceeds of the Notes, will be a deemed capital
contribution to the Issuer (through the Owner, a wholly-owned subsidiary of the
Seller). Upon such sale, the ownership of such Timeshare Loan and all
collections allocable to principal and interest thereon due after the related
Cut-Off Date and all other property interests or rights conveyed pursuant to and
referenced in this Section 2(a) shall immediately vest in the Issuer, its
successors and assigns. The Seller shall not take any action inconsistent with
such ownership nor claim any ownership interest in any Timeshare Loan for any
purpose whatsoever other than for consolidated financial and federal and state
income tax reporting.

(b) Delivery of Timeshare Loan Files. In connection with the sale, transfer,
assignment and conveyance of any Timeshare Loans hereunder, the Issuer hereby
directs the Seller and the Seller hereby agrees to deliver or cause to be
delivered to the Custodian all related Timeshare Loan Files no later than the
applicable Funding Date or Transfer Date, as the case may be.

(c) Collections. The Seller shall deposit or cause to be deposited all
collections that are received by it in respect of the Timeshare Loans conveyed
hereunder on and after the related Cut-Off Date in the Collection Account.

(d) Limitation of Liability. Neither the Issuer nor any subsequent assignee of
the Issuer shall have any obligation or liability with respect to any Timeshare
Loan nor shall the Issuer or any subsequent assignee have any liability to any
Obligor in respect of any Timeshare Loan. No such obligation or liability is
intended to be assumed by the Issuer or any subsequent assignee herewith and any
such obligation or liability is hereby expressly disclaimed.

SECTION 3. Intended Characterization; Grant of Security Interest. It is the
intention of the parties hereto that each transfer of Timeshare Loans to be made
pursuant to the terms hereof shall constitute a sale by the Seller to the Issuer
of such Timeshare Loans and the related property described in Section 2 hereof
and not a loan secured by such Timeshare Loans and the related property. In the
event, however, that a court of competent jurisdiction were to hold that any
such transfer constitutes a loan and not a sale, it is the intention of the
parties hereto (i) that the Seller shall be deemed to have Granted to the Issuer
as of the date hereof a first priority perfected security interest in all of the
Seller’s right, title and interest in, to and under each Timeshare Loan whether
now owned or hereafter acquired, and the related property as described in
Section 2 hereof and (ii) this Agreement shall constitute a security agreement
under applicable law. In the event of the characterization of any such transfer
as a loan, the amount of interest payable or paid with respect to such loan
under the terms of this Agreement shall be limited to an amount which shall not
exceed the maximum nonusurious rate of interest allowed by the applicable state
law or any applicable law of the United States permitting a higher maximum
nonusurious rate that preempts such applicable state law, which could lawfully
be contracted for, charged or received (the “Highest Lawful Rate”). In the event
any payment of

 

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interest on any such loan exceeds the Highest Lawful Rate, the parties hereto
stipulate that (a) to the extent possible given the term of such loan, such
excess amount previously paid or to be paid with respect to such Timeshare Loans
be applied to reduce the principal balance of such Timeshare Loans, and the
provisions thereof immediately be deemed reformed and the amounts thereafter
collectible thereunder reduced, without the necessity of the execution of any
new document, so as to comply with the then applicable law, but so as to permit
the recovery of the fullest amount otherwise called for thereunder and (b) to
the extent that the reduction of the principal balance of, and the amounts
collectible under, such loan and the reformation of the provisions thereof
described in the immediately preceding clause (a) is not possible given the term
of such loan, such excess amount will be deemed to have been paid with respect
to such loan as a result of an error and upon discovery of such error or upon
notice thereof by any party hereto such amount shall be refunded by the
recipient thereof.

The characterization of the Seller as “debtor” and the Issuer as “secured party”
in any financing statement required hereunder is solely for protective purposes
and shall in no way be construed as being contrary to the intent of the parties
that this transaction be treated as a sale to the Issuer of the Seller’s entire
right, title and interest in and to the property specified in the first sentence
of this Section 3.

SECTION 4. Conditions Precedent to Acquisition of Timeshare Loans. The
obligations of the Issuer to purchase any Timeshare Loans hereunder shall be
subject to the satisfaction of the following conditions:

(a) With respect to each Funding Date and Transfer Date, all representations and
warranties of the Seller contained in Section 5(a) hereof shall be true and
correct on the related Funding Date and Transfer Date, as applicable, as if made
on such date, and all representations and warranties as to the Timeshare Loans
contained in Section 5(b) hereof and all information provided in the Schedule of
Timeshare Loans in respect of the Timeshare Loans (including the Qualified
Substitute Timeshare Loans conveyed on such Transfer Date) shall be true and
correct on such Funding Date and Transfer Date, as the case may be.

(b) On or prior to each Funding Date and Transfer Date, as the case may be, the
Seller shall have delivered or shall have caused the delivery of the related
Timeshare Loan Files to the Custodian in accordance with Section 2(b) hereof and
the Custodian shall have delivered a receipt therefor pursuant to the Custodial
Agreement on or prior to the Funding Date or the Transfer Date, as applicable.

(c) The Seller shall have delivered all other information theretofore required
or reasonably requested by the Issuer to be delivered by the Seller or performed
all other obligations required to be performed as of the Funding Date or
Transfer Date, as the case may be, including all filings, recordings and/or
registrations as may be necessary in the opinion of the Issuer or the Indenture
Trustee to establish and preserve the right, title and interest of the Issuer or
the Indenture Trustee, as the case may be, in the related Timeshare Loans, it
being understood and agreed that assignments and sales of the Timeshare Loans
from MORI to the Seller, from the Seller to the Issuer and the collateral
assignment from the Issuer to the Indenture Trustee will not be recorded in real
estate records except as required under the Indenture and Servicing Agreement.

 

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(d) On or before the Amendment Effective Date, the Issuer, the Servicer, the
Back-Up Servicer and the Indenture Trustee shall have entered into the Indenture
and Servicing Agreement and on any Funding Date, the Indenture and Servicing
Agreement shall be in full force and effect.

(e) Each Timeshare Loan conveyed on a Funding Date shall be an Eligible
Timeshare Loan.

(f) Each of the conditions precedent under Section 4.03 of the Indenture and
Servicing Agreement and Section 2.2 of the Note Purchase Agreement shall have
been satisfied.

(g) Each Qualified Substitute Timeshare Loan replacing a Timeshare Loan shall
satisfy each of the criteria specified in the definition of “Qualified
Substitute Timeshare Loan” and each of the conditions in Section 6 herein and in
Section 4.06 of the Indenture and Servicing Agreement for substitution of
Timeshare Loans shall have been satisfied.

(h) The Seller and the Issuer shall have duly entered, executed and delivered an
Additional Timeshare Loan Supplement in the form attached hereto as Exhibit D.

(i) The Seller shall have delivered to the Issuer copies of UCC financing
statements covering such Additional Timeshare Loans if necessary to perfect the
Issuer’s first priority interest in such Additional Timeshare Loans and the
related assets.

(j) The Seller shall have delivered such other certificates and opinions as
shall be reasonably requested by the Issuer or its assignee.

SECTION 5. Representations and Warranties and Certain Covenants of the Seller.

(a) The Seller represents and warrants to the Issuer and the Indenture Trustee
for the benefit of the Noteholders, on each Funding Date and Transfer Date (with
respect to the Timeshare Loans or the Qualified Substitute Timeshare Loans
transferred on such Funding Date or Transfer Date) as follows:

(i) Due Incorporation; Valid Existence; Good Standing. The Seller is a
corporation duly organized and validly existing in good standing under the laws
of the jurisdiction of its incorporation; and is duly qualified to do business
as a foreign corporation and in good standing under the laws of each
jurisdiction where the character of its property, the nature of its business or
the performance of its obligations under this Agreement makes such qualification
necessary, except where the failure to be so qualified will not have a material

 

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adverse effect on the business of the Seller or its ability to perform its
obligations under this Agreement or any other Facility Document to which it is a
party or under the transactions contemplated hereunder or thereunder or the
validity or enforceability of the Timeshare Loans.

(ii) Possession of Licenses, Certificates, Franchises and Permits. The Seller
holds, and at all times during the term of this Agreement will hold, all
material licenses, certificates, franchises and permits from all governmental
authorities necessary for the conduct of its business, and has received no
notice of proceedings relating to the revocation of any such license,
certificate, franchise or permit, which singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would materially and
adversely affect its ability to perform its obligations under this Agreement or
any other Facility Document to which it is a party or under the transactions
contemplated hereunder or thereunder or the validity or enforceability of the
Timeshare Loans.

(iii) Corporate Authority and Power. The Seller has, and at all times during the
term of this Agreement will have, all requisite corporate power and authority to
own its properties, to conduct its business, to execute and deliver this
Agreement and all documents and transactions contemplated hereunder and to
perform all of its obligations under this Agreement and any other Facility
Document to which it is a party or under the transactions contemplated hereunder
or thereunder. The Seller has all requisite corporate power and authority to
acquire, own, transfer and convey the Timeshare Loans to the Issuer.

(iv) Authorization, Execution and Delivery; Valid and Binding. This Agreement
and all other Facility Documents and instruments required or contemplated hereby
to be executed and delivered by the Seller have been duly authorized, executed
and delivered by the Seller and, assuming the due execution and delivery by, the
other party or parties hereto and thereto, constitute legal, valid and binding
agreements enforceable against the Seller in accordance with their respective
terms subject, as to enforceability, to bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting the enforceability of creditors’
rights generally applicable in the event of the bankruptcy, insolvency, or
reorganization of the Seller and to general principles of equity, regardless of
whether such enforceability shall be considered in a proceeding in equity or at
law. This Agreement constitutes a valid transfer of the Seller’s interest in the
Timeshare Loans to the Issuer or the valid creation of a first priority
perfected security interest in the Timeshare Loans in favor of the Issuer.

(v) No Violation of Law, Rule, Regulation, etc. The execution, delivery and
performance by the Seller of this Agreement and any other Facility Document to
which the Seller is a party do not and will not (A) violate any of the
provisions of the certificate of incorporation or bylaws of the Seller,
(B) violate any provision of any law, governmental rule or regulation currently
in effect applicable to the Seller or its properties or by which the Seller or
its properties may be bound or affected, including, without limitation, any bulk
transfer laws,

 

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(C) violate any judgment, decree, writ, injunction, award, determination or
order currently in effect applicable to the Seller or its properties or by which
the Seller or its properties are bound or affected, (D) conflict with, or result
in a breach of, or constitute a default under, any of the provisions of any
indenture, mortgage, deed of trust, contract or other instrument to which the
Seller is a party or by which it is bound or (E) result in the creation or
imposition of any Lien upon any of its properties pursuant to the terms of any
such indenture, mortgage, deed of trust, contract or other instrument.

(vi) Governmental Consent. No consent, approval, order or authorization of, and
no filing with or notice to, any court or other Governmental Authority in
respect of the Seller is required which has not been obtained in connection with
the authorization, execution, delivery or performance by the Seller of this
Agreement or any of the other Facility Documents to which it is a party or under
the transactions contemplated hereunder or thereunder, including, without
limitation, the transfer of the Timeshare Loans and the creation of the security
interest of the Issuer therein pursuant to Section 3 hereof.

(vii) Defaults. The Seller is not in default under any material agreement,
contract, instrument or indenture to which the Seller is a party or by which it
or its properties is or are bound, or with respect to any order of any court,
administrative agency, arbitrator or governmental body, in each case, which
would have a material adverse effect on the transactions contemplated hereunder
or on the business, operations, financial condition or assets of the Seller, and
no event has occurred which with notice or lapse of time or both would
constitute such a default with respect to any such agreement, contract,
instrument or indenture, or with respect to any such order of any court,
administrative agency, arbitrator or governmental body.

(viii) No Adverse Change. Since the end of its most recent, audited fiscal year,
there has been no change in the business, operations, financial condition,
properties or assets of the Seller which would have a material adverse effect on
its ability to perform its obligations under this Agreement or any other
Facility Document to which it is a party or materially adversely affect the
transactions contemplated under this Agreement or any such other Facility
Documents.

(ix) Insolvency. The Seller will be solvent at all relevant times prior to, and
will not be rendered insolvent by, the transfer of the Timeshare Loans
hereunder. On the Closing Date, Amendment Effective Date or a Funding Date or
Transfer Date, as applicable, the Seller will not engage in any business or
transaction for which any property remaining with the Seller would constitute an
unreasonably small amount of capital.

(x) Pending Litigation or Other Proceedings. There is no pending or, to the best
of the Seller’s knowledge, threatened action, suit, proceeding or investigation
before any court, administrative agency, arbitrator or

 

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governmental body against or affecting the Seller which, if decided adversely,
would materially and adversely affect (i) the condition (financial or
otherwise), business or operations of the Seller, (ii) the ability of the Seller
to perform its obligations under, or the validity or enforceability of, this
Agreement or any other Facility Document to which it is a party, (iii) any
Timeshare Loans or title of any Obligor to any Timeshare Properties, or (iv) the
Issuer’s ability to foreclose or otherwise enforce the liens of the Timeshare
Loans, including the right to revoke or otherwise terminate the Right-to-Use
Agreements and the rights of the Obligors to use and occupy the related
Timeshare Property.

(xi) Information. No document, certificate or report furnished or required to be
furnished by or on behalf of the Seller pursuant to this Agreement, in its
capacity as the Seller, contains or will contain when furnished any untrue
statement of a material fact or fails, or will fail, to state a material fact
necessary in order to make the statements contained therein not misleading.
There are no facts known to the Seller which, individually or in the aggregate,
materially adversely affect, or which (aside from general economic trends) may
reasonably be expected to materially adversely affect in the future, the
financial condition or assets or business of the Seller, or which may impair the
ability of the Seller to perform its obligations under this Agreement and any
other Facility Document to which it is a party, which have not been disclosed
herein or therein or in the certificates and other documents furnished to the
Issuer by or on behalf of the Seller pursuant hereto or thereto specifically for
use in connection with the transactions contemplated hereby or thereby.

(xii) Foreign Tax Liability. The Seller is not aware of any Obligor under a
Timeshare Loan who has withheld any portion of payments due under such Timeshare
Loan because of the requirements of a foreign taxing authority, and no foreign
taxing authority has contacted the Seller concerning a withholding or other
foreign tax liability.

(xiii) Employee Benefit Plan Liability. As of the Closing Date, the Amendment
Effective Date and each Funding Date and Transfer Date, as applicable, (i) with
respect to any “employee pension benefit plan” (as such term is defined in
Section 3(2) of ERISA) sponsored, maintained or contributed to by Seller or any
of its Commonly Controlled Affiliates (as defined below), other than any Seller
Multiemployer Plan (as defined below), no “accumulated funding deficiency” (as
such term is defined under Section 302 of ERISA or Section 412 of the Code),
whether or not waived, with respect to any plan year beginning prior to
January 1, 2008, or with respect to any plan year beginning after December 31,
2007, no unpaid “minimum required contribution” (as such term is defined under
Section 303 of ERISA or Section 430 of the Code) exists, and, to the Seller’s
knowledge, no event has occurred or circumstance exists that may result in an
unpaid minimum required contribution as of the last day of the current plan year
of any such plan; (ii) the Seller and each of its Commonly Controlled Affiliates
has made all undisputed contributions required under each multiemployer plan (as
such term is defined in Section 3(37) of ERISA) (a “Multiemployer Plan”) to

 

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which the Seller or any of its Commonly Controlled Affiliates contributes or in
which the Seller or any of its Commonly Controlled Affiliates participates (a
“Seller Multiemployer Plan”); and (iii) the aggregate outstanding liability of
the Seller and its Commonly Controlled Affiliates for disputed contributions
required under all Seller Multiemployer Plans collectively does not exceed
$500,000 in the aggregate. As of each Funding Date or Transfer Date, the
aggregate outstanding liability of the Seller and its Commonly Controlled
Affiliates for any partial or complete withdrawal from any Multiemployer
Plans collectively does not exceed $10 million, and, to the Seller’s knowledge,
no event has occurred or circumstance exists that presents a risk that the
aggregate outstanding liability of the Seller and its Commonly Controlled
Affiliates for any partial or complete withdrawal from, or the partition,
termination, reorganization or insolvency of, any Multiemployer Plans
could collectively exceed $10 million. For purposes of this subsection (xiii),
“Commonly Controlled Affiliates” means those direct or indirect affiliates of
the Seller that would be considered a single employer with the Seller under
Section 414(b), (c), (m), or (o) of the Code.

(xiv) Taxes. The Seller has filed all tax returns (federal, state and local)
which it reasonably believes are required to be filed and has paid or made
adequate provision for the payment of all taxes, assessments and other
governmental charges due from the Seller or is contesting any such tax,
assessment or other governmental charge in good faith through appropriate
proceedings or such failure will not have a material adverse effect on the
rights and interests of the Issuer. The Seller knows of no basis for any
material additional tax assessment for any fiscal year for which adequate
reserves have not been established. The Seller intends to pay all such taxes,
assessments and governmental charges when due.

(xv) Places of Business. The places of business where the Servicer on behalf of
the Seller keeps its records concerning the Timeshare Loans will be 1200 U.S.
Highway 98 South, Lakeland, Florida 33801 and 6649 Westwood Boulevard, Orlando,
Florida 32821 (or such other place specified by the Seller by written notice to
the Issuer and the Indenture Trustee). The principal place of business and chief
executive office of the Seller is located at 6649 Westwood Boulevard, Orlando,
Florida 32821 (or such other place specified by the Seller by written notice to
the Issuer and the Indenture Trustee).

(xvi) Securities Laws. The Seller is not an “investment company” or a company
“controlled” by an “investment company” within the meaning of the Investment
Company Act of 1940, as amended. No portion of the Timeshare Loan Acquisition
Price for each of the Timeshare Loans will be used by the Seller to acquire any
security in any transaction which is subject to Section 13 or Section 14 of the
Securities Exchange Act of 1934, as amended.

(xvii) Ownership of the Seller. Effective on the Amendment Effective Date, one
hundred percent (100%) of the outstanding voting stock of the Seller is directly
owned (both beneficially and of record) by MVW US Holdings,

 

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Inc., a Delaware corporation, which is a subsidiary of MVW. Such stock is
validly issued, fully paid and nonassessable, and there are no options, warrants
or other rights to acquire capital stock from the Seller.

(b) The Seller hereby: (i) represents and warrants that upon the transfer of any
Timeshare Loan to the Issuer, the Issuer will have full legal and equitable
title to such Timeshare Loan, free and clear of any liens and encumbrances and
(ii) makes the representations and warranties contained in Schedule I hereto for
the benefit of the Issuer and the Indenture Trustee for the benefit of the
Noteholders with respect to each Timeshare Loan as of the related Funding Date
and as of each Transfer Date (with respect to each Timeshare Loan and Qualified
Substitute Timeshare Loan transferred on such Funding Date or Transfer Date), as
applicable.

(c) It is understood and agreed that the representations and warranties set
forth in this Section 5 shall survive the sale of each Timeshare Loan to the
Issuer and any assignment of such Timeshare Loan by the Issuer to the Indenture
Trustee for the benefit of the Noteholders and shall continue so long as any
such Timeshare Loan shall remain outstanding until such time as such Timeshare
Loan is repurchased or a Qualified Substitute Timeshare Loan is provided
pursuant to Section 6 hereof. The Seller acknowledges that it has been advised
that the Issuer intends to collaterally assign all of its right, title and
interest in and to each Timeshare Loan and its rights and remedies under this
Agreement to the Indenture Trustee for the benefit of the Noteholders. The
Seller agrees that, upon any such assignment, the Indenture Trustee may enforce
directly, without joinder of the Issuer (but subject to any defense that the
Seller may have under this Agreement) all rights and remedies hereunder.

(d) With respect to any representations and warranties contained in Section 5(a)
and Section 5(b) hereof which are made to the best of the Seller’s knowledge, if
it is discovered that any representation and warranty is inaccurate and such
inaccuracy materially and adversely affects the value of a Timeshare Loan or the
interests of the Issuer or any assignee thereof, then notwithstanding the
Seller’s lack of knowledge of the accuracy of such representation and warranty
at the time such representation or warranty was made, such inaccuracy shall be
deemed a breach of such representation or warranty for purposes of the
repurchase or substitution obligations described herein.

SECTION 6. Repurchases and Substitutions.

(a) Mandatory Repurchases and Substitutions for Breaches of Representations and
Warranties. Upon the discovery by the Seller or the Issuer of a breach of any of
the representations and warranties in Section 5(a) or Section 5(b) hereof which
materially and adversely affects the value of a Timeshare Loan or the interests
of the Issuer or any subsequent assignee of the Issuer (including the Indenture
Trustee for the benefit of the Noteholders) therein, the party discovering such
breach shall give prompt written notice thereof to the others and the
Performance Guarantor; provided that with respect to any Trust-Based Timeshare
Loan, no breach of any representation or warranty set forth in clauses (aa),
(cc), (ff), (kk), (mm), or (oo) of Schedule I hereto will be deemed to
materially and adversely affect the value of such Timeshare Loan or the

 

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interests of the Issuer or any subsequent assignee of the Issuer therein unless
such breach materially and adversely affects the MVC Trust. Within 60 days from
the date the Seller is notified of, or otherwise discovers, such breach, the
Seller shall eliminate or otherwise cure in all material respects the
circumstance or condition which has caused such representation or warranty to be
incorrect or either (i) repurchase such Timeshare Loan at the Repurchase Price,
or (ii) provide one or more Qualified Substitute Timeshare Loans for such
Timeshare Loan and pay the related Substitution Shortfall Amount, if any.

Notwithstanding the foregoing, (A) the failure to deliver a policy of lender’s
title insurance in respect of a Timeshare Loan shall not constitute a breach of
representation or warranty in respect of such Timeshare Loan if (i) the
Timeshare Loan File contains a commitment to issue a policy of lender’s title
insurance, and (ii) if such actual policy is delivered not later than the 90th
day following the Funding Date or the Transfer Date, as the case may be, and
(B) the failure to provide evidence that a Mortgage or certificate of title has
been recorded and/or stamped, as the case may be, in the appropriate recording
office shall not constitute a breach of representation or warranty in respect of
such Timeshare Loan if such evidence is provided not later than the 90th day
following the Funding Date or the Transfer Date, as the case may be; provided,
however, that if such policy of lender’s title insurance was delayed because the
related original Mortgage (or a copy thereof) had not been received from the
appropriate recording office prior to the 80th day following the Funding Date or
Transfer Date, as the case may be, then such 90-day periods in (A)(ii) and
(B) shall be extended to a date 30 days after such receipt.

(b) Optional Repurchases and Substitutions of Timeshare Loans. On any date, the
Seller shall have the option, but not the obligation, to either (i) repurchase a
Defaulted Timeshare Loan from the Issuer for a price equal to the Repurchase
Price therefor, or (ii) substitute one or more Qualified Substitute Timeshare
Loans for a Defaulted Timeshare Loan and pay the related Substitution Shortfall
Amount, if any; provided, however, the aggregate Cut-Off Date Loan Balance of
Defaulted Timeshare Loans that may be repurchased and of Defaulted Timeshare
Loans that may be substituted pursuant to this Section 6(b) shall be limited on
any date to 20% of the highest aggregate Loan Balance of all Timeshare Loans
owned by the Issuer since the Closing Date or, if a Securitization Take-Out
shall have occurred, the related Securitization Take-Out Date, less the
aggregate Cut-Off Date Loan Balance of all Defaulted Timeshare Loans previously
repurchased or substituted at the Seller’s option.

(c) Payment of Repurchase Prices and Substitution Shortfall Amounts. The Issuer
hereby directs and the Seller hereby agrees to remit all amounts in respect of
Repurchase Prices and Substitution Shortfall Amounts in immediately available
funds to the Collection Account. In the event that more than one Timeshare Loan
is substituted pursuant to Sections 6(a) or (b) hereof on any Transfer Date, the
Substitution Shortfall Amounts and the Loan Balances of Qualified Substitute
Timeshare Loans shall be calculated on an aggregate basis for all substitutions
made on such Transfer Date.

(d) Schedule of Timeshare Loans. The Issuer hereby directs, and the Seller
hereby agrees, on each date on which a Timeshare Loan has been repurchased or
substituted, to provide the Issuer and the Indenture Trustee with a revised
Schedule of Timeshare Loans reflecting the removal of such Timeshare Loans and
subjecting any Qualified Substitute Timeshare Loans to the provisions of this
Agreement.

 

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(e) Officer’s Certificate. The Seller shall, on each Transfer Date, certify in
writing to the Issuer and the Indenture Trustee that (i) each new Timeshare Loan
meets all the criteria of the definition of “Qualified Substitute Timeshare
Loan”, (ii) the Timeshare Loan Files for such Qualified Substitute Timeshare
Loans have been delivered to the Custodian and (iii) the Timeshare Loan
Servicing Files for such Qualified Substitute Timeshare Loan have been delivered
to the Servicer.

(f) Release. In connection with any repurchase or substitution of one or more
Timeshare Loans contemplated by this Section 6, upon satisfaction of the
conditions contained in this Section 6, the Issuer shall execute and deliver (or
shall cause the Issuer to execute and deliver) such instruments of transfer or
assignment presented to it by the Seller, in each case without recourse, as
shall be necessary to vest in the Seller the legal and beneficial ownership of
such Timeshare Loans; provided that with respect to a release of a Timeshare
Loan that is substituted by a Qualified Substitute Timeshare Loan, the Issuer
shall not execute and deliver or cause the execution and delivery of such
releases and instruments of transfer or assignment until the Indenture Trustee
and the Servicer receive a receipt from the Custodian for such Qualified
Substitute Timeshare Loan. The Issuer shall cause the Custodian to release the
related Timeshare Loan Files to the Seller or its designee.

(g) Sole Remedy. It is understood and agreed that the obligations of the Seller
to cure, repurchase or substitute Timeshare Loans contained in Section 6(a)
hereof and the obligation of the Seller to indemnify pursuant to Section 8
hereof shall constitute the sole remedies for the breaches of any representation
or warranty with respect to the Timeshare Loans contained in Section 5(a) or
Section 5(b) hereof.

SECTION 7. Additional Covenants of the Seller. The Seller hereby covenants and
agrees with the Issuer as follows:

(a) The Seller will comply in all material respects with all applicable laws,
rules, regulations and orders and preserve and maintain its corporate existence,
rights, franchises, qualifications and privileges except to the extent that the
failure so to comply with such laws, rules and regulations or the failure so to
preserve and maintain such existence, rights, franchises, qualifications and
privileges could not reasonably be expected to materially adversely affect the
collectibility of the Timeshare Loans or the ability of the Seller to perform
its obligations under this Agreement and any of the Facility Documents to which
it is a party.

(b) On or prior to each Funding Date or a Transfer Date, as applicable, the
Seller shall indicate in its computer files and other records that each
Timeshare Loan has been sold to the Issuer and subsequently pledged by the
Issuer to the Indenture Trustee for the benefit of the Noteholders.

 

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(c) The Seller shall respond to any inquiries with respect to ownership of a
Timeshare Loan by stating that such Timeshare Loan has been sold to the Issuer
and that the Issuer is the owner of such Timeshare Loan and that such Timeshare
Loan has been pledged by the Issuer to the Indenture Trustee for the benefit of
the Noteholders.

(d) On or prior to a Funding Date or a Transfer Date, as applicable, the Seller
shall file, at its own expense, financing statements in favor of the Issuer,
and, if applicable, the Indenture Trustee for the benefit of the Noteholders
with respect to the Timeshare Loans meeting the requirements of state law in
such manner and in such jurisdictions as are necessary or appropriate to perfect
the acquisition of the Timeshare Loans by the Issuer from the Seller, and shall
deliver file-stamped copies of such financing statements to the Issuer and the
Indenture Trustee for the benefit of the Noteholders.

(e) The Seller agrees from time to time, at its expense, promptly to execute and
deliver all further instruments and documents, and to take all further actions,
that may be necessary, or that the Issuer or the Indenture Trustee may
reasonably request, to perfect, protect or more fully evidence the sale of the
Timeshare Loans, or to enable the Issuer or the Indenture Trustee to exercise
and enforce its rights and remedies hereunder or under any Timeshare Loan
including but not limited to powers of attorney, UCC financing statements and
assignments of Mortgage and Right-to-Use Agreement. The Seller hereby appoints
the Issuer and the Indenture Trustee as attorney-in-fact, which appointment is
coupled with an interest and is therefore irrevocable, to act on behalf and in
the name of the Seller to enforce obligations of the Seller hereunder.

(f) Any change in the legal name of the Seller and any use by it of any
tradename, fictitious name, assumed name or “doing business as” name occurring
after the Closing Date shall be promptly disclosed in writing to the Issuer and
the Indenture Trustee.

(g) Upon the discovery or receipt of notice of a breach of any of its
representations or warranties and covenants contained herein, the Seller shall
promptly disclose to the Issuer and the Indenture Trustee, in reasonable detail,
the nature of such breach.

(h) The Seller shall promptly, but in no event later than two Business Days (or,
if initially there is insufficient information to determine to which Timeshare
Loan any funds relate, within two Business Days of obtaining sufficient
information) transfer to the Collection Account, any payment it receives in
respect of a Timeshare Loan.

(i) In the event that the Seller or the Issuer or any assignee of the Issuer
should receive actual notice of any transfer taxes arising out of the transfer,
assignment and conveyance of a Timeshare Loan, on written demand by the Issuer,
or upon the Seller otherwise being given notice thereof, the Seller shall pay,
and otherwise indemnify and hold the Issuer and any of its assignees harmless,
on an after-tax basis, from and against any and all such transfer taxes.

 

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(j) The Seller will keep its principal place of business and chief executive
office and the office where it keeps its records concerning the Timeshare Loans
at the address of the Seller listed herein or, upon 30 days’ prior written
notice to the Issuer and the Indenture Trustee, at any other location in
jurisdictions where all actions reasonably requested by the Issuer or the
Indenture Trustee to protect and perfect the interest in the Timeshare Loans,
Obligor Notes and Right-to-Use Agreements under the applicable UCC have been
taken and completed within 10 days of such notice. The Seller also will maintain
and implement administrative and operating procedures (including, without
limitation, an ability to recreate records in the event of the destruction of
the originals thereof), and keep and maintain all documents, books, records and
other information reasonably necessary or advisable for the collection of all
Timeshare Loans (including, without limitation, records adequate to permit the
daily identification of each Obligor Note and all payments made with regard to
the related Timeshare Loans).

(k) The Seller shall authorize and file such continuation statements and any
other documents reasonably requested by the Issuer or the Indenture Trustee or
which may be required by law to preserve and protect the interest of the Issuer
or the Indenture Trustee hereunder in and to the Timeshare Loans.

(l) The Seller agrees from time to time, at its expense, promptly to execute and
deliver all further instruments and documents, and to take all further actions,
that may be necessary, or that the Issuer or the Indenture Trustee may
reasonably request, to perfect, protect or more fully evidence the Timeshare
Loans, or to enable the Issuer or the Indenture Trustee to exercise and enforce
its rights and remedies hereunder or under any of the other Facility Documents
to which it is a party.

(m) The Seller authorizes the Issuer and the Indenture Trustee to file
continuation statements, and amendments thereto, relating to the Timeshare
Loans, the underlying Obligor Notes and all payments made with regard to the
Timeshare Loans without the signature of the Seller where permitted by law. A
photocopy or other reproduction of this Agreement shall be sufficient as a
financing statement where permitted by law. The Issuer confirms that it is not
its present intention to file a photocopy or other reproduction of this
Agreement as a financing statement, but reserves the right to do so if, in its
good faith determination, there is at such time no reasonable alternative
remaining to it.

(n) In the event that the Seller shall have received any insurance proceeds
relating to a Timeshare Property and such proceeds are not payable to an
Obligor, the Seller shall promptly remit such insurance proceeds to the
Indenture Trustee for deposit into the Collection Account.

SECTION 8. Indemnification.

(a) The Seller agrees to indemnify the Issuer, the Indenture Trustee, the
Administrative Agent, the Funding Agents and the Noteholders (each an
“Indemnified Party”, collectively, the “Indemnified Parties”) against (x) any
and all claims, losses, liabilities, (including legal fees and related costs)
that such Indemnified

 

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Parties may sustain directly or indirectly related to any inaccuracy or breach
of the representations and warranties of the Seller under Section 5 hereof and
(y) a failure by the Seller to perform any of its obligations under the Facility
Documents (“Indemnified Amounts”) excluding, however (i) Indemnified Amounts to
the extent resulting from the gross negligence or willful misconduct on the part
of such Indemnified Party; (ii) any recourse for any uncollectible Timeshare
Loan not related to a breach of representation or warranty by the Seller;
(iii) recourse to the Seller for a Defaulted Timeshare Loan so long as the same
is replaced or repurchased pursuant to Section 6 hereof; (iv) income, franchise
or similar taxes with respect to such Indemnified Party arising out of or as a
result of this Agreement or the transfer of the Timeshare Loans; (v) Indemnified
Amounts attributable to any violation by an Indemnified Party of any requirement
of law related to an Indemnified Party; or (vi) the operational or
administration expenses of an Indemnified Party generally and not related to the
enforcement of this Agreement. The Seller shall (x) promptly notify the Issuer
and the Indenture Trustee if a claim is made by a third party with respect to
this Agreement or the Timeshare Loans, and relating to (i) the failure by the
Seller to perform its duties in accordance with the terms of this Agreement or
(ii) a breach of the Seller’s representations, covenants and warranties
contained in this Agreement, and (y) assume (with the consent of the related
Indemnified Party, which consent shall not be unreasonably withheld) the defense
of any such claim and pay all expenses in connection therewith, including
counsel fees, and promptly pay, discharge and satisfy any judgment, order or
decree which may be entered against it or the related Indemnified Party in
respect of such claim. If the Seller shall have made any indemnity payment
pursuant to this Section 8 and the recipient thereafter collects from another
Person any amount relating to the matters covered by the foregoing indemnity,
the recipient shall promptly repay such amount to the Seller.

(b) The obligations of the Seller under this Section 8 to indemnify the
Indemnified Parties shall survive the termination of this Agreement and continue
until the Notes are paid in full or otherwise released or discharged.

SECTION 9. No Proceedings. The Seller hereby agrees that it will not, directly
or indirectly, institute, or cause to be instituted, or join any Person in
instituting, against the Issuer or any Resort, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any federal or state bankruptcy or similar law so long as there shall not have
elapsed one year plus one day since the latest maturing Notes issued by the
Issuer.

SECTION 10. Notices, Etc. All notices and other communications provided for
hereunder shall, unless otherwise stated herein, be in writing and mailed or
telecommunicated, or delivered as to each party hereto, at its address set forth
under its name on the signature page hereof or at such other address as shall be
designated by such party in a written notice to the other parties hereto. All
such notices and communications shall not be effective until received by the
party to whom such notice or communication is addressed.

SECTION 11. No Waiver; Remedies. No failure on the part of the Seller, the
Issuer or any assignee thereof to exercise, and no delay in exercising, any
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. The remedies herein provided are
cumulative and not exclusive of any other remedies provided by law.

 

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SECTION 12. Binding Effect; Assignability. This Agreement shall be binding upon
and inure to the benefit of the Seller, the Issuer and their respective
successors and permitted assigns. Any assignee shall be an express third party
beneficiary of this Agreement, entitled directly to enforce this Agreement. The
Seller may not assign any of its rights and obligations hereunder or any
interest herein without the prior written consent of the Issuer and any of its
assignees. The Issuer may, and intends to, assign all of its rights hereunder to
the Indenture Trustee for the benefit of the Noteholders and the Seller consents
to any such assignment. This Agreement shall create and constitute the
continuing obligations of the parties hereto in accordance with its terms, and
shall remain in full force and effect until its termination; provided, however,
that the rights and remedies with respect to any breach of any representation
and warranty made by the Seller pursuant to Section 5 hereof and the repurchase
or substitution and indemnification obligations shall be continuing and shall
survive any termination of this Agreement but such rights and remedies may be
enforced only by the Issuer and the Indenture Trustee.

SECTION 13. Amendments; Consents and Waivers. No modification, amendment or
waiver of, or with respect to, any provision of this Agreement, and all other
agreements, instruments and documents delivered thereto, nor consent to any
departure by the Seller from any of the terms or conditions thereof shall be
effective unless it shall be in writing and signed by each of the parties hereto
and the written consent of the Indenture Trustee for the benefit of the
Noteholders is given. The Issuer shall provide the Indenture Trustee with such
proposed modifications, amendments or waivers. Any waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
consent by the Indenture Trustee shall, in itself, entitle Seller to any other
consent in similar or other circumstances. The Seller acknowledges that in
connection with the intended pledge by the Issuer of all of its right, title and
interest in and to each Timeshare Loan to the Indenture Trustee for the benefit
of the Noteholders, the Issuer intends to issue the Notes, the proceeds of which
will be used by the Issuer to purchase the Timeshare Loans conveyed hereunder.

SECTION 14. Severability. In case any provision in or obligation under this
Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation, shall not in any way be
affected or impaired thereby in any other jurisdiction. Without limiting the
generality of the foregoing, in the event that a Governmental Authority
determines that the Issuer may not purchase or acquire Timeshare Loans, the
transactions evidenced hereby shall constitute a loan and not a purchase and
sale, notwithstanding the otherwise applicable intent of the parties hereto, and
the Seller shall be deemed to have granted to the Issuer as of the date hereof,
a first priority security interest in all of the Seller’s right, title and
interest in, to and under such Timeshare Loan and the related property as
described in Section 2 hereof.

SECTION 15. GOVERNING LAW; CONSENT TO JURISDICTION.

(a) THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW

 

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YORK, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW OTHER THAN
SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK.

(b) THE SELLER AND THE ISSUER HEREBY SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES DISTRICT COURT LOCATED
IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY AND EACH WAIVES PERSONAL SERVICE OF
ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE
MADE BY REGISTERED MAIL DIRECTED TO THE ADDRESS SET FORTH ON THE SIGNATURE PAGE
HEREOF AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED FIVE DAYS AFTER THE
SAME SHALL HAVE BEEN DEPOSITED IN THE U.S. MAILS, POSTAGE PREPAID. THE SELLER
AND THE ISSUER EACH HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS,
AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND CONSENTS TO
THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE
COURT. NOTHING IN THIS SECTION 15 SHALL AFFECT THE RIGHT OF THE SELLER OR THE
ISSUER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE
RIGHT OF ANY OF THEM TO BRING ANY ACTION OR PROCEEDING IN THE COURTS OF ANY
OTHER JURISDICTION.

SECTION 16. Headings. The headings herein are for purposes of reference only and
shall not otherwise affect the meaning or interpretation of any provision
hereof.

SECTION 17. Execution in Counterparts. This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and both of which when taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of this
Agreement by facsimile or other electronic transmission (i.e., “pdf” or “tif”)
shall be effective as delivery of a manually executed counterpart hereof and
deemed an original.

SECTION 18. Owner Trustee. It is expressly understood and agreed by the parties
hereto that (a) this Agreement is executed and delivered by Wilmington Trust,
N.A. not individually or personally but solely as Owner Trustee of the Issuer,
in the exercise of the powers and authority conferred and vested in it, (b) each
of the representations, undertakings and agreements herein made or on the part
of the Issuer is made and intended not as personal representations, undertakings
and agreements by Wilmington Trust, N.A., but is made and intended for the
purpose of binding only the Issuer, (c) nothing herein contained shall be
construed as creating any liability on Wilmington Trust, N.A., individually or
personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties hereto
and by any Person claiming by, through or under the parties hereto, and
(d) under no circumstances shall Wilmington Trust, N.A. be personally liable for
the payment of any indebtedness or expenses of the Issuer or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Issuer under this Agreement or any other related document.
Notwithstanding the foregoing, Wilmington Trust, N.A. shall not be relieved of
any of its duties and obligations under the Administration Agreement or the
Trust Agreement.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties have caused this Amended and Restated Sale
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.

 

MORI SPC SERIES CORP., as Seller

By:

 

/s/ Joseph J. Bramuchi

  Name:   Joseph J. Bramuchi   Title:   Vice President   Address:  

6649 Westwood Boulevard

Orlando, Florida 32821

  Telephone:   (407) 513-6954   Facsimile:   (407) 206-6032 MARRIOTT VACATIONS
WORLDWIDE OWNER TRUST 2011-1

By:

  WILMINGTON TRUST, NATIONAL ASSOCIATION, not individually, but solely in its
capacity as Owner Trustee

By:

 

/s/ Dante M. Monakil

  Name:   Dante M. Monakil   Title:   Vice President   Address:  

1220 North Market Street, Suite 202

Wilmington, Delaware 19801

  Telephone:   (302) 255-4970   Facsimile:   (302) 661-2266

 

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ACKNOWLEDGED AND CONSENTED TO:

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Indenture Trustee

 

By:  

/s/ Jennifer Westberg

  Name:   Jennifer Westberg   Title:   Vice President   Address:  

Sixth Street & Marquette Avenue

Minneapolis, Minnesota 55479

    Attention:  

Corporate Trust

Services/Asset-Backed Administration

  Telephone:   (206) 327-9427   Facsimile:   (866) 634-0908

 

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Schedule I

(a) All federal, state or local laws, rules or regulations, including, without
limitation, those relating to usury, truth-in-lending, real estate settlement
procedure, land sales, the offer and sale of securities, consumer credit
protection and equal credit opportunity or disclosure, applicable to the
Timeshare Loan or the sale of the Timeshare Property securing the related
Obligor Note have been complied with in all material respects. The applicable
rescission period with respect to the Timeshare Loan has expired, and the
Timeshare Loan was not originated in, or is subject to the laws of, any
jurisdiction under which the transfer, conveyance or assignment of such
Timeshare Loan would be unlawful, void or voidable.

(b) If the Timeshare Loan is a Mortgage Loan, the Timeshare Property constitutes
a fee interest in real property at one of the Resorts or a real property
interest in the MVC Trust and the related Mortgage has been duly filed and
recorded (or is in the process of being recorded) with all appropriate
governmental authorities in all jurisdictions in which such Mortgage is required
to be filed and recorded to create a valid, binding and enforceable first
priority perfected security interest on the related Timeshare Property subject
only to Permitted Liens. If the Timeshare Loan is a Right-to-Use Loan, the
related Timeshare Property is a Unit at a Resort and the related Right-to-Use
Agreement grants the related Obligor the right to use and occupy such Unit and
the related Right-to-Use Agreement has been duly filed and recorded with all
governmental authorities in all jurisdictions in which the related Right-to-Use
Agreement is required to be filed and recorded to enable the Seller and its
assigns to enforce the revocation and termination rights granted in the
Right-to-Use Agreement.

(c) Upon the transfer pursuant to Section 2 of this Agreement of the Timeshare
Loan from the Seller to the Issuer, the Issuer will own full legal and equitable
title to such Timeshare Loan, free and clear of any lien, charge, encumbrance or
participation or ownership interest in favor of any other Person, other than the
Permitted Liens. All of the Seller’s right, title and interest in and to such
Timeshare Loan has been validly and effectively transferred to the Issuer or a
valid first priority security interest in, and/or the right of revocation and
termination provided in the related Right-to-Use Agreement with respect to, the
related Obligor Note has been created or assigned in favor of the Issuer.

(d) Each of the related Mortgage, related Right-to-Use Agreement, related
Obligor Note, and each other document in the related Timeshare Loan File is
genuine and the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms (except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, and other similar laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity, regardless of whether such enforceability shall be
considered in a proceeding in equity or at law), and is not subject to any
dispute, right of setoff, recoupment, counterclaim, or defense of any kind,
whether arising out of transactions concerning such Timeshare Loan or otherwise,
and no such right has been asserted with respect thereto.

 

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(e) All parties to the related Mortgage or the related Right-to-Use Agreement
and the related Obligor Note had legal capacity to enter into such Mortgage or
Right-to-Use Agreement and Obligor Note and to execute and deliver such related
Mortgage or the related Right-to-Use Agreement and related Obligor Note, and
such related Mortgage, related Right-to-Use Agreement and related Obligor Note
have been duly and properly executed by such parties. No amendments to such
related Mortgage or the related Right-to-Use Agreement, related Obligor Note or
any other document in the related Timeshare Loan File were required as a result
of any mergers involving the Seller or its predecessors to maintain the rights
of the Seller or its predecessors thereunder as a mortgagee or party to a
Right-to-Use Agreement. The related Obligor has not been released, in whole or
in part, from any of its obligations in respect of the Timeshare Loan. No
Obligor Note has been satisfied, canceled, rescinded or subordinated, in whole
or in part, and no instrument has been executed that would effect any such
satisfaction, release, cancellation, subordination or rescission.

(f) At the time the originator made the related Obligor Note secured by a
Mortgage or a Right-to-Use Agreement to the related Obligor, such Obligor had
good and marketable fee simple title to the Timeshare Property or Right-to-Use
Agreement securing such Obligor Note, free and clear of all Liens, except for
Permitted Liens.

(g) The related Mortgage or Right-to-Use Agreement, as the case may be, contains
customary and enforceable provisions so as to render the rights and remedies of
the holder thereof adequate for the practical realization against the related
Timeshare Property of the benefits of the security interests or other remedies
intended to be provided thereby, including by judicial foreclosure or other
applicable remedies. There is no exemption available to the related Obligor
which would interfere with the mortgagee’s right to foreclose such related
Mortgage, if applicable, or the Issuer’s or Servicer’s right to enforce the
revocation and termination rights in the related Right-to-Use Agreement, other
than that which may be available under applicable bankruptcy, debt relief,
homestead statutes or the Servicemembers Civil Relief Act of 2003, or a similar,
applicable law of the country in which the Obligor is located, if other than the
United States.

(h) The related Obligor Note is not and has not been secured by any collateral
except the Lien of the related Mortgage or rights and remedies in the related
Right-to-Use Agreement, as the case may be.

(i) (x) The related Mortgage or Right-to-Use Agreement, as applicable, for
(A) each jurisdiction in which a Resort is located, and (B) the jurisdiction
under which the Beneficial Interests are issued and (y) the related Obligor Note
for (A) each jurisdiction in which a Resort is located and (B) each jurisdiction
in which Beneficial Interests are sold, are substantially in the respective
forms set forth as Exhibit B hereto.

 

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(j) All entries with respect to such Timeshare Loan (including if it is a
Qualified Substitute Timeshare Loan) as set forth on the related Schedule of
Timeshare Loans are true and correct.

(k) All of the related Timeshare Loan Servicing Files for such Timeshare Loan
have been, on or prior to the Funding Date or Transfer Date, as applicable,
obtained by the Servicer and all the related Timeshare Loan Files are complete
(as required in the definition of “Timeshare Loan Files”) in all material
respects and are in the possession of the Custodian.

(l) The Mortgage, if any, is covered by a form of lender’s title insurance
policy issued by a title insurer qualified to do business in the jurisdiction
where the related Timeshare Property or, with respect to a Beneficial Interest,
the MVC Trust, is located, insuring the Seller and its successors and assigns,
as to the first priority perfected Lien of the Mortgage, subject only to
Permitted Liens, in an amount equal to or greater than the Loan Balance of such
Obligor Note on the Funding Date or Transfer Date, as the case may be. Such
lender’s title insurance policy is in full force and effect. No claims have been
made under such lender’s title insurance policy, and no prior holder of such
Mortgage, including the Seller, has done or omitted to do anything which would
impair the coverage of such lender’s title insurance policy.

(m) The Seller has not taken (or omitted to take), and has no notice that the
related Obligor has taken (or omitted to take), any action that would impair or
invalidate the coverage provided by any hazard, title or other insurance policy,
if any, relating to such Obligor Note or the related Timeshare Property.

(n) The related Obligor Note evidences a fully amortizing debt obligation which
bears a fixed rate of interest, provides for substantially level monthly
payments of principal and interest (other than the final payment thereon), and
is payable in United States dollars.

(o) The related Obligor Note has an original term to stated maturity of twenty
years or less.

(p) A minimum of one payment due under the Timeshare Loan has been made on the
related Obligor Note prior to the related Cut-Off Date.

(q) Such Timeshare Loan is not more than 30 days delinquent on any payment of
principal or interest.

(r) All applicable intangible taxes, documentary stamp taxes and state and local
taxes were paid in respect of such Timeshare Loan.

(s) Interest is calculated on the related Obligor Note on a simple interest
basis.

 

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(t) The proceeds of the Timeshare Loan has been fully disbursed and no
additional performance by the Seller is required.

(u) The terms of the related Mortgage, Right-to-Use Agreement, if applicable,
and Obligor Note have not been modified in any material respect (unless by a
writing contained in the related Timeshare Loan Files or as required by the
Servicemembers’ Civil Relief Act) and in no event to avoid delinquency or
default.

(v) The related Obligor Note, if secured by a Mortgage, is principally and
directly secured by an interest in real property.

(w) The related Obligor Note was originated by MORI or one of its subsidiaries
or Affiliates in the ordinary course of its, its subsidiary’s or its Affiliate’s
business in connection with the initial sale or resale of a timeshare estate or
the right to use and occupy a Timeshare Property, all in accordance with the
Credit and Collection Policy in effect at such time of origination.

(x) The related Timeshare Property, or the right to use and occupy the related
Timeshare Property, or the shares of a Resort Association or the MVC Trust
Association, as applicable, granting the right to use and occupy the related
Timeshare Property, are assignable upon liquidation of the Obligor Note to which
it relates without the consent of the related Resort Association or the MVC
Trust Association, as applicable, or any other Person and there are no other
restrictions on resale thereof, except that as to a Resort Association that is a
cooperative association, such right of assignment may be exercisable by the
Seller or any Affiliate of the Seller as agent of the Resort Association.

(y) The related Obligor is not (i) a Person (other than an individual) that is
affiliated with the Seller, the Servicer, or any of their respective affiliates,
or (ii) a Governmental Authority.

(z) With respect to a Weeks-Based Timeshare Loan, (i) the related Resort
Association was duly organized and, to the best of the Seller’s knowledge, is
validly existing and in good standing in the state of its organization, (ii) a
MORI Affiliated Manager manages the related Resort and, if there is a related
Resort Association, performs services for such Resort Association, pursuant to
agreements between such MORI Affiliated Manager and such Resort Association,
each of such agreements being in full force and effect, (iii) any agreements
mentioned in the preceding clause (ii) include services that are substantially
similar to the services described in the true and correct copy of a management
agreement between such MORI Affiliated Manager and one of the Resort
Associations, which has been furnished to the Issuer, and (iv) such MORI
Affiliated Manager and the related Resort Association have performed in all
material respects all obligations under any such agreements and are not in
material default thereunder.

(aa) With respect to a Trust-Based Timeshare Loan, (i) each MVW Resort
Association and the MVC Trust Association was duly organized and, to the best

 

  S-4   

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of the Seller’s knowledge, is validly existing and in good standing in the state
of its organization, (ii) a MORI Affiliated Manager manages all of the MVW
Resorts and, if there is a related MVW Resort Association, performs services for
such MVW Resort Association, pursuant to agreements between such MORI Affiliated
Manager and such MVW Resort Association, each of such agreements being in full
force and effect, (iii) any agreements mentioned in the preceding clause
(ii) include services that are substantially similar to the services described
in the true and correct copy of a management agreement between such MORI
Affiliated Manager and one of the MVW Resort Associations, which has been
furnished to the Issuer, and (iv) such MORI Affiliated Manager and the related
MVW Resort Association have performed in all material respects all obligations
under any such agreements and are not in material default thereunder.

(bb) With respect to a Weeks-Based Timeshare Loan, (i) the related Resort
procures casualty and property insurance through the related Resort Association,
if any, or through the Seller or an Affiliate of the Seller. Such property
insurance includes coverage for damage or loss for the full replacement value
thereof or, if not available on commercially reasonable terms, the maximum
amount that the Servicer, in accordance with the Servicing Standard, determines
is available on commercially reasonable terms, and, to the extent that the
Servicer has determined, in accordance with the Servicing Standard, that such
coverage is not available on commercially reasonable terms, the Seller has
provided (or caused the Servicer to provide) written notice to the Issuer of
such determination, (ii) in the event that the related Unit should suffer any
loss covered by property damage insurance, upon receipt of any Insurance
Proceeds, such Resort Association, or the Seller or an Affiliate of the Seller,
are required, during the time such Unit is covered by such insurance, under the
applicable governing instruments of the Resort Association or otherwise, either
to repair or rebuild the portions of the applicable Resort or to pay such
proceeds to the holders of any Mortgages secured by a timeshare estate in the
portions of the applicable Resort, and (iii) if the related Resort is located in
the United States and is located in a high hazard flood plain, the related
Resort Association maintains flood insurance in an amount not less than the
maximum level available under the National Flood Insurance Program.

(cc) With respect to a Trust-Based Timeshare Loan, (i) each MVW Resort procures
casualty and property insurance through the related MVW Resort Association, if
any, or through the Seller or an Affiliate of the Seller. Such property
insurance includes coverage for damage or loss for the full replacement value
thereof or, if not available on commercially reasonable terms, the maximum
amount that the Servicer, in accordance with the Servicing Standard, determines
is available on commercially reasonable terms, and, to the extent that the
Servicer has determined, in accordance with the Servicing Standard, that such
coverage is not available on commercially reasonable terms, the Seller has
provided (or caused the Servicer to provide) written notice to the Issuer of
such determination, (ii) in the event that any MVW Unit should suffer any loss
covered by property damage insurance, upon receipt of any Insurance Proceeds,
such MVW Resort Association, or the Seller or an Affiliate of the Seller, are
required, during the time such MVW Unit is covered by such insurance,

 

  S-5   

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under the applicable governing instruments of the MVW Resort Association or
otherwise, either to repair or rebuild the portions of the applicable MVW Resort
or to pay such proceeds to the owners (including the MVC Trust) of, or any
mortgagees with respect to, the timeshare estates in the portions of the
applicable MVW Resort, and (iii) for each MVW Resort which is located in the
United States in a high hazard flood plain, the related MVW Resort Association
maintains flood insurance in an amount not less than the maximum level available
under the National Flood Insurance Program.

(dd) If such Timeshare Loan is a Mortgage Loan, it requires the related Obligor
to pay all taxes, insurance premiums and maintenance costs with respect to the
related Timeshare Property or, in the case of Timeshare Loans related to
Timeshare Properties in the State of Virginia, requires that the Obligor timely
pay and perform its obligations under, and shall not violate the terms and
provisions of any declaration or other document recorded in the real estate
records where the related Resort is located for purposes of creating and
governing the rights of owners of Timeshare Properties related thereto, as may
be in effect from time to time (each, as “Declaration”) and any rules and
regulations promulgated in connection therewith. If such Timeshare Loan is a
Right-to-Use Loan, it requires the related Obligor to pay all maintenance costs
with respect to the related Timeshare Property. There are no delinquent taxes,
ground rents, water charges, sewer rents, assessments outstanding with respect
to the related Timeshare Property, and there are no other material outstanding
Liens affecting the related Timeshare Property, other than Permitted Liens.

(ee) With respect to a Weeks-Based Timeshare Loan, the related Timeshare
Property and related Resort are free of material damage and waste and there is
no proceeding pending or, to the best knowledge of the Seller, threatened for
the total or partial condemnation or taking of such Timeshare Property or Resort
by eminent domain.

(ff) With respect to a Trust-Based Timeshare Loan, all the MVW Resorts are, in
the aggregate, free of material damage and waste and there is no proceeding
pending or, to the best knowledge of the Seller, threatened for the total or
partial condemnation or taking of any MVW Resort by eminent domain.

(gg) No consent, approval, order or authorization of, and no filing with or
notice to, any court or Governmental Authority in respect of the related Obligor
is required which has not been obtained in connection with the transfer of such
Timeshare Loan to the Issuer.

(hh) The Timeshare Loan was not selected using selection procedures reasonably
believed by the Seller to be adverse to the Issuer.

(ii) Other than with respect to any Pre-Completion Loans related to the Resorts
specified on the related Additional Timeshare Loan Supplement, with respect to a
Weeks-Based Timeshare Loan, (i) the Unit related to the Timeshare Loan has been
completed in all material respects as required by applicable federal, state and
local laws, free of all defects that could give rise to any claims thereunder;
(ii) to the extent required by applicable law, valid certificates of occupancy
for such Unit has been issued and are

 

  S-6   

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currently outstanding; and (iii) the Seller and its commonly controlled
Affiliates have complied in all material respects with all obligations and
duties incumbent upon the developers of the related Resort including the related
Declarations and similar applicable documents for the related Resort. If the
Timeshare Loan is a Pre-Completion Loan related to the Resorts specified on the
related Additional Timeshare Loan Supplement the related Unit is expected to be
an Available Unit by the Anticipated Completion Date specified thereon.

(jj) With respect to a Weeks-Based Timeshare Loan, (i) no practice, procedure or
policy employed by the related Resort Association in the conduct of its business
violates any law, regulation, judgment or agreement, including, without
limitation, those relating to zoning, building, use and occupancy, fire, health,
sanitation, air pollution, ecological, environmental and toxic wastes,
applicable to such Resort Association or MORI Affiliated Manager which, if
enforced, would reasonably be expected to (A) have a material adverse impact on
such Resort Association or the ability of such Resort Association or MORI
Affiliated Manager to do business, (B) have a material adverse impact on the
financial condition of such Resort Association or MORI Affiliated Manager, or
(C) constitute grounds for the revocation of any license, charter, permit or
registration which is material to the conduct of the business of the Resort
Association or MORI Affiliated Manager, (ii) the related Resort and the present
use thereof does not violate any applicable environmental, zoning or building
laws, ordinances, rules or regulations of any governmental authority, or any
covenants or restrictions of record, so as to materially adversely affect the
value or use of such Resort or the performance by the related Resort Association
of its obligations pursuant to and as contemplated by the terms and provisions
of the related Declaration, (iii) there is no condition presently existing and
no event has occurred or failed to occur prior to the date hereof, concerning
the related Resort relating to any hazardous or toxic materials or condition,
asbestos or other environmental or similar matters which would reasonably be
expected to materially and adversely affect the present use of such Resort or
the financial condition or business operations of the related Resort
Association, or the value of such Timeshare Loan.

(kk) With respect to a Trust-Based Timeshare Loan, (i) no practice, procedure or
policy employed by any MVW Resort Association or the MVC Trust Association in
the conduct of its business violates any law, regulation, judgment or agreement,
including, without limitation, those relating to zoning, building, use and
occupancy, fire, health, sanitation, air pollution, ecological, environmental
and toxic wastes, applicable to such MVW Resort Association, the MVC Trust
Association or MORI Affiliated Manager, which, if enforced, would reasonably be
expected to (A) have a material adverse impact on such Resort Association or the
MVC Trust Association, as applicable, or the ability of such MVW Resort
Association or the MVC Trust Association, as applicable, or MORI Affiliated
Manager to do business, (B) have a material adverse impact on the financial
condition of such MVW Resort Association, the MVC Trust Association or MORI
Affiliated Manager, or (C) constitute grounds for the revocation of any license,
charter, permit or registration which is material to the conduct of the business
of such MVW Resort Association, the MVC Trust Association or MORI

 

  S-7   

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Affiliated Manager, (ii) neither any MVW Resort nor the present use thereof
violates any applicable environmental, zoning or building laws, ordinances,
rules or regulations of any governmental authority, or any covenants or
restrictions of record, so as to materially adversely affect the value or use of
such MVW Resort or the performance by the related MVW Resort Association or MVC
Trust Association, as applicable, of its obligations pursuant to and as
contemplated by the terms and provisions of the related Declaration, (iii) there
is no condition presently existing and no event has occurred or failed to occur
prior to the date hereof, concerning any MVW Resort relating to any hazardous or
toxic materials or condition, asbestos or other environmental or similar matters
which would reasonably be expected to materially and adversely affect the
present use of such MVW Resort or the financial condition or business operations
of the related MVW Resort Association, the MVC Trust Association or the value of
such Timeshare Loan.

(ll) With respect to a Weeks-Based Timeshare Loan, the related Resort has made
all filings and holds all material licenses, permits and registrations which are
required under the laws of each jurisdiction in which the nature of its
activities make such filings, licenses, permits or registrations necessary.

(mm) With respect to a Trust-Based Timeshare Loan, the MVW Resorts have made all
filings and hold all material licenses, permits and registrations which are
required under the laws of each jurisdiction in which the nature of its
activities make such filings, licenses, permits or registrations necessary.

(nn) With respect to a Weeks-Based Timeshare Loan, the capital reserves and
maintenance fee levels of the Resort Association related to the related Resort
are adequate in light of the operating requirements of such Resort Association.

(oo) With respect to a Trust-Based Timeshare Loan, the capital reserves and
maintenance fee levels of the MVW Resort Associations are adequate in light of
the operating requirements thereof.

(pp) Each of the assignments of Mortgage and each endorsement of the related
Obligor Note constitutes a duly executed, legal, valid, binding and enforceable
assignment or endorsement, as the case may be, of such related Mortgage and
related Obligor Note, and all monies due or to become due thereunder, and all
proceeds thereof.

(qq) The related Mortgage is and will be prior to any Lien on, or other
interests relating to, the related Timeshare Property (other than the Permitted
Liens).

(rr) The Timeshare Loan and the related Obligor Note (i) is not in default due
to the Obligor’s failure to have timely made one or more payments owed on the
Obligor Note, (ii) is not guaranteed by the Seller or any Affiliate thereof,
(iii) does not contain a provision that permits the Obligor Note to be converted
into, or exchanged for, any legal or beneficial ownership interest in any asset,
or has a provision under which one or more payments thereunder are determined in
reference or are contingent upon the value of any asset, (iv) does not have the
timing or amount of payments under the Obligor Note determined by reference to,
or is contingent on, the timing or amount of

 

  S-8   

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payments made on debt issued by the Seller or any affiliate thereof, (v) is not
a partial interest in a debt instrument (such as a stripped bond or a stripped
coupon) and (vi) is not traded on an established securities market.

(ss) The related Obligor has a Current Equity Percentage of at least 10% of the
Purchase Price for the related Timeshare Property securing such Timeshare Loan.

(tt) If the related Obligor is a Domestic Obligor, such Obligor has a FICO score
of at least 600.

(uu) With respect to a Weeks-Based Timeshare Loan relating to the Aruba Surf
Club or the Aruba Ocean Club, a notice has been delivered or will be delivered
within 45 days of the Funding Date or Transfer Date, as applicable, to the
related Obligor indicating that such Weeks-Based Timeshare Loan has been
transferred to the Issuer and the Trustee.

(vv) No broker is, or will be, entitled to any commission or compensation in
connection with the transfer of the Timeshare Loan.

(ww) The Timeshare Loan does not, when aggregated with all other Timeshare Loans
conveyed on the Funding Date or Transfer Date, as applicable and the Borrowing
Base Loans, as of the Funding Date or Transfer Date, as applicable, cause any of
the following to fail to be true:

(1) the weighted average FICO score of the Obligors with respect to the
Borrowing Base Loans is at least 700; and

(2) the weighted average interest rate of the Borrowing Base Loans (excluding
any Repurchased Timeshare Loans) is equal to or greater than 12.00%; provided
that the weighted average interest rate of the Repurchased Timeshare Loans shall
be equal to or greater than 9.00%.

(xx) With respect to (i) a Trust-Based Timeshare Loan or (ii) a Weeks-Based
Timeshare Loan relating to a Resort located in the State of South Carolina, such
Timeshare Loan was originated on or after December 5, 2005.

(yy) With respect to (i) a Trust-Based Timeshare Loan or (ii) a Weeks-Based
Timeshare Loan relating to a Resort located in the State of Nevada, such
Timeshare Loan was not originated between November 13, 2008 and February 3,
2009.

(zz) No payment due under the Timeshare Loan (other than, if applicable, the
waiver in the ordinary course of any nominal processing fees and charges
required to be paid by the related Obligor) has been made, directly or
indirectly, by MORI, the Servicer or any of their Affiliates.

 

  S-9   

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(aaa) With respect to a Trust-Based Timeshare Loan, the MVC Trust is a Florida
land trust validly established pursuant to Section 689.071, Florida Statutes,
and the MVC Trust Agreement.

(bbb) With respect to a Trust-Based Timeshare Loan, all timeshare fee or other
estates in MVW Units held by the MVC Trustee (i) have been properly conveyed to
the MVC Trustee, (ii) are owned by the MVC Trustee with full legal and equitable
title thereto, free and clear of all liens and (iii) have a certificate of
occupancy.

(ccc) With respect to a Trust-Based Timeshare Loan, none of Marriott Ownership
Resorts Inc., MVC Trust Owners Association, Inc. or, to the best of the Seller’s
knowledge, First American Trust FSB, is in default under the MVC Trust Agreement
or has caused the one-to-one right to use night requirement ratio to fail to be
maintained with respect to the Trust Property.

(ddd) The Timeshare Loan does not relate to a Timeshare Property in Units 5221,
5222, 5231, 5232, 5233, 5234, 5241, 5242, 5243 and 5244 in the SurfWatch
Horizontal Property Regime.

(eee) A local counsel opinion acceptable to the Administrative Agent with
respect to the Timeshare Loan and related documents in the related jurisdiction
has been delivered to the Administrative Agent, each Funding Agent and each
Non-Conduit Committed Purchaser.

 

  S-10   

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Exhibit A

Schedule of Timeshare Loans

[Electronic Schedule of Timeshare Loans on file with Indenture Trustee].

--------------------------------------------------------------------------------

Exhibit B

Form of Obligor Note, Mortgage and Right-to-Use Agreement

See Attached

--------------------------------------------------------------------------------

CALIFORNIA SAMPLE (RCDC)

UPON CLOSE OF ESCROW OF THE PURCHASE TO WHICH THIS NOTE APPLIES, BORROWER(S)
HEREBY AUTHORIZE(S) ESCROW HOLDER/CLOSING AGENT OR HOLDER TO COMPLETE THIS NOTE
BY INSERTING THE DATE OF THE NOTE AND APPLICABLE DATES FOR PAYMENT COMMENCEMENT
DATE, MATURITY DATE AND DATE FOR EACH MONTHLY PAYMENT

NOTE SECURED BY DEED OF TRUST

 

Account #:  

 

Date:  

 

 

US $  

 

  (Amount Financed)

FOR VALUE RECEIVED, THE UNDERSIGNED, AND IF MORE THAN ONE, JOINTLY AND
SEVERALLY, (“Borrower”) promises to pay to the order of The Ritz-Carlton
Development Company, Inc., a Delaware corporation, or its assigns (“Holder”), at
6649 Westwood Blvd., Orlando, Florida 32821, the principal sum of             
U.S. Dollars (U.S. $        ), plus interest at the rate of              percent
(    %) annually, calculated on the basis of a 360-day year, at the Holder’s
address set forth above or at such other place as the Holder may designate from
time to time, in      consecutive monthly installments of              U.S.
Dollars (U.S. $        ) each, with the first such installment being due and
payable on              and each successive installment being due and payable on
the      day of each month thereafter, with the remaining unpaid principal
balance, together with accrued interest thereon, due and payable, if not sooner
paid, on                      (the “Maturity Date”). Interest at the above rate
will begin to accrue one month prior to the month in which the first installment
is due, on the day of the prior month which corresponds to the day of the month
that the first installment is due.

This Note is secured by a Deed of Trust of even date herewith (“Deed of Trust”)
to First American Title Insurance Company, as trustee, creating a lien on the
property described therein (“Property”) purchased by Borrower pursuant to a
Purchase Agreement (“Purchase Agreement”). The Deed of Trust (including, without
limitation, its acceleration, collection and allocation of payment provisions)
is incorporated herein by reference.

At the option of Holder, the entire principal balance outstanding and accrued
interest thereon will become immediately due and payable without further notice
upon: (a) the failure of Borrower to pay when due any monthly installment under
this Note; (b) the failure of Borrower to comply with any other term or
provision of this Note, the Purchase Agreement or the Deed of Trust within 10
days following written notice thereof from Holder to Borrower (in the manner
specified in the Deed of Trust); (c) the insolvency (however evidenced) of or
the institution of proceedings in bankruptcy by or against Borrower; or (d) the
discovery by Holder of a misrepresentation made on behalf of Borrower to obtain
credit or an extension of credit.

Holder may exercise its option to accelerate during any default by Borrower
regardless of any prior forbearance. If any sums due under this Note are not
paid when due, whether at maturity or by acceleration, the Holder will be
entitled to collect all reasonable costs and expenses of collection, including,
but not limited to, reasonable attorney’s fees, including, without limitation,
those incurred in all bankruptcy and probate proceedings, and regardless of
whether any suit or proceeding is filed and reasonable collection agency fees.

Each monthly payment shall be tendered with an $8.75 service fee. Borrower will
pay Holder (i) a late charge of the greater of $6.00 or 6.0% of the installment
due for any monthly installment not received by Holder within 10 days after the
due date, and (ii) a returned check charge as reasonably established by Holder
from time to time for each occurrence of the return to Holder for any reason of
any check, draft or order. Late charges will be deducted from the next payment
received. No late charge will be imposed more than once for the same late
payment of an installment.

Borrower may prepay this Note in whole or in part at any time without penalty or
premium. Any partial prepayment shall be applied by Lender to either accrued and
unpaid interest or to outstanding principal, at Lender’s discretion, and will
not postpone the due date or change the amount of any subsequent monthly
installments.

Presentment, notice of dishonor and protest are waived by all makers, sureties,
guarantors and endorsers hereof. This Note is the joint and several obligation
of all makers, sureties, guarantors and endorsers, and will be binding upon them
and their successors and assigns.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting

 

491110.5 (02.19.10)

Page 1 of 2

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interest under applicable law, and contracted for, chargeable or receivable
under this Note or otherwise in connection with this loan transaction shall
neither exceed the maximum amount of interest, nor produce a rate in excess of
the maximum non-usurious rate of interest that Holder may charge Borrower(s)
under applicable law and in regard to which Borrower(s) may not successfully
assert the claim or defense of usury; and (iii) if any excess interest is
provided for or collected, it shall be deemed a mistake and the same shall
either be refunded to Borrower(s) or be credited on the unpaid principal amount
hereof, and this Note shall be automatically deemed reformed so as to permit
only the collection of the maximum non-usurious rate and amount of interest
allowable under applicable law.

THIS NOTE IS GOVERNED BY, CONSTRUED UNDER AND ENFORCED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF CALIFORNIA.

SIGNATURE(S)

 

 

   

 

 

   

 

 

491110.5 (02.19.10)

Page 2 of 2

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RECORDING REQUESTED BY

 

AND WHEN RECORDED MAIL TO

 

Order No.

   CALIFORNIA SAMPLE (RCDC)

 

SPACE ABOVE THIS LINE FOR RECORDER’S USE

UPON CLOSE OF ESCROW OF THE PURCHASE TO WHICH THIS DEED OF TRUST APPLIES,
TRUSTOR(S) HEREBY AUTHORIZE(S) ESCROW HOLDER/CLOSING AGENT OR HOLDER OF THE NOTE
TO COMPLETE THIS DEED OF TRUST AND THE NOTE AS PROVIDED FOR IN THE CONTRACT FOR
PURCHASE PURSUANT TO WHICH THE FRACTIONAL INTEREST(S) WERE ACQUIRED BY TRUSTORS

DEED OF TRUST WITH ASSIGNMENT OF RENTS

This DEED OF TRUST (this “Deed of Trust”) is made on
                                         by                             , herein
called TRUSTOR, whose address is                              in favor of First
American Title Insurance Company, a California corporation, herein called
TRUSTEE, for the benefit of The Ritz-Carlton Development Company, Inc., a
Delaware corporation (solely as nominee for Lender, as hereinafter defined, and
Lender’s successors and assigns), herein called BENEFICIARY and LENDER, as
context requires. Beneficiary is organized and existing under the laws of
Delaware, and has an address of 6649 Westwood Blvd., Orlando, Florida 32821, and
telephone number of                     .

Trustor irrevocably grants, transfers and assigns to Trustee in Trust, with
Power of Sale, that property located in the County of Placer, California, and
described in Exhibit “A” attached hereto.

TOGETHER with the rents, issues and profits thereof, subject, however, to the
right, power and authority hereinafter given to and conferred upon Beneficiary
to collect and apply such rents, issues and profits;

TOGETHER with all the improvements now or hereafter erected on the property, and
all easements, rights, appurtenances, rents, royalties, mineral, oil and gas
rights and profits, water, water rights and water stock, and all fixtures now or
hereafter attached to the property, all of which, including replacements and
additions thereto, shall be deemed to be and remain part of the property covered
by this Deed of Trust (collectively, the “Property”);

For the purpose of securing (1) payment of the sum of $             with
interest thereon according to the terms of a promissory note or notes of even
date herewith made by Trustor, payable to order of Lender, and extensions or
renewals thereof (collectively, the “Note”); (2) the performance of each
agreement of Trustor incorporated by reference or contained herein or reciting
it is so secured; and (3) payment of additional sums and interest thereon which
may hereafter be loaned to Trustor, or Trustor’s successors or assigns, when
evidenced by a promissory note or notes reciting that they are secured by this
Deed of Trust.

1. To protect the security of this Deed of Trust, and with respect to the
Property above described, Trustor expressly makes each and all of the
agreements, and adopts and agrees to perform and be bound by each and all of the
terms and provisions set forth in that certain Fictitious Deed of Trust with
Assignment of Rents recorded in the Official Records of Placer County as
Document No. 2009-0083293-00 recorded on September 28, 2009, (the “Fictitious
Deed of Trust”), and it is mutually agreed that each and all of the provisions
set forth in the Fictitious Deed of Trust shall inure to the benefit of and bind
the parties hereto with respect to the Property. The agreements, terms and
provisions contained in said Fictitious Deed of Trust are incorporated by
reference herein and made a part of this Deed of Trust for all purposes as fully
as if set forth at length herein. Trustor hereby acknowledges that Trustor has
been provided a complete copy of the Fictitious Deed of Trust at or prior to the
time of the execution of this Deed of Trust.

2. Trustor acknowledges and agrees that all sums received by Lender from Trustor
will be applied first to (i) any outstanding sums due from Trustor to Lender
under the Purchase Agreement, including without limitation any initial or
additional deposits or closing costs payable by Trustor, (ii) then to amounts
payable to Beneficiary by Trustor under paragraph 6 hereof, (iii) then to
advances, if any, made by the Lender pursuant to paragraph 5 of the Fictitious
Deed of Trust , (iv) then to the costs, fees, expenses and other amounts

 

437816.3 (9.18.09)

Page 1 of 4

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incurred and advanced by the Lender in the enforcement of its rights hereunder,
including, without limitation, costs and reasonable attorney’s fees described
herein, (v) then to unpaid service fees, (vi) then to interest, (vii) then to
principal, and (viii) then to unpaid late charges and/or returned check charges,
if any. Trustor also acknowledges and agrees that such application will not
reduce, delay, excuse, waive or otherwise affect the amounts and due dates of
all sums to be paid by Trustor to Lender under the Note or this Deed of Trust.
Trustor further acknowledges and agrees that, in the event that the funds
delivered or intended to be delivered to Lender pursuant to the Note are applied
to such sums as are due as set forth at (i) through (viii) above, Holder, at
Holder’s sole option, may elect to (a) immediately demand payment of any monthly
installment payments which are applied in whole or in part to the sums due under
(i) through (viii) above, or (b) extend the term of the Note to accommodate such
additional monthly installments as are necessary to make up any monthly payments
thus applied.

3. Lender may charge for a statement regarding the obligation secured hereby,
provided the charge therefor does not exceed the maximum allowed by law.

4. Except as expressly permitted in Article I Paragraph 9 of the Fictitious Deed
of Trust, if Trustor shall sell, convey or alienate the Property, or any part
thereof, or any interest therein, or shall be divested of any title or interest
therein in any manner or way, whether voluntarily or involuntarily, without the
written consent of the Lender being first had and obtained, Lender shall have
the right, at its option, except as prohibited by law, to declare any
indebtedness or obligations secured hereby, irrespective of the maturity date
specified in any note evidencing the same, immediately due and payable.

5. Trustor understands and agrees that Trustee holds only legal title to the
interests granted by Trustor in this Deed of Trust; but, if necessary to comply
with law or custom, Beneficiary has the right to direct Trustee (as nominee for
Lender and Lender’s successors and assigns) to exercise any or all of those
interests, including, but not limited to the right to foreclose and sell the
Property; and to take any action required of Lender including, but not limited
to, releasing or canceling this Deed of Trust.

6. As further protection of the security of this Deed of Trust, and with respect
to the property above described, subject to applicable law, upon written request
by Beneficiary to Trustor(s), Trustor(s) shall pay to Beneficiary on the day
when monthly installments of principal and interest are payable under the Note
Secured by Deed of Trust dated as of the date hereof (“Note”), until the Note is
paid in full, a sum (herein “Funds”) equal to one-twelfth or such other
fractional increments which total 100% of the Basic Assessment, Tax Assessment
and/or any other similar assessments (the “Assessments”) applicable to the
subject property, as reasonably estimated initially and from time to time by
Beneficiary on the basis of assessments and bills and reasonable estimates
thereof.

7. If Beneficiary exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
federal or state agency. Beneficiary shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay the Assessments. Beneficiary may not charge
for so holding and applying the Funds, analyzing said account, or verifying and
compiling said Assessments and bills, unless Beneficiary pays to Trustor(s)
interest on the Funds and applicable law permits Beneficiary to make such a
charge. Unless applicable law requires, Beneficiary shall not be required to pay
Trustor(s) any interest on earnings on the Funds. Beneficiary shall give to
Trustor(s), without charge, an annual accounting of the Funds showing credits
and debits to the Funds and the purposes for which each debit to the Funds was
made. The Funds are hereby pledged as additional security for the sums secured
by this Deed of Trust.

8. If the amount of the Funds held by Beneficiary, together with the future
monthly installments of Funds payable prior to the due date of applicable
Assessments shall exceed the amount required to pay such applicable Assessments
as they fall due, such excess shall be, at the option of Trustor(s), either
promptly repaid to Trustor(s) or credited to Trustor(s) on monthly installments
of Funds. If the amount of the Funds held by Beneficiary shall not be sufficient
to pay applicable Assessments as they fall due, Trustor(s) shall pay to
Beneficiary any amount necessary to make up the deficiency within thirty
(30) days from the date of a notice mailed by Beneficiary to Trustor(s)
requesting payment thereof.

9. Upon payment in full of all sums secured by this Deed of Trust, Beneficiary
shall promptly refund to Trustor(s) any Funds held by Beneficiary. If the
subject property is sold or is otherwise acquired by Beneficiary, Beneficiary
shall apply, no later than immediately prior to the sale of the subject property
or its acquisition by Beneficiary, any Funds then held by Beneficiary as a
credit against the sums secured by this Deed of Trust.

 

437816-3 (9.18.09)

Page 2 of 4

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The undersigned Trustor requests that a copy of any notice of default, any
notice of sale or any other notice hereunder be mailed to Trustor at the address
set forth above.

IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date
written below.

TRUSTOR(S):

 

Name

 

 

   

Name

 

 

Signature:  

 

    Signature:  

 

Date:  

 

    Date:  

 

 

State of    )       )    ss. County of    )   

On                                          before me,
                                         (here insert name and title of the
officer), personally appeared                     , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s)is/are
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s)on the instrument the person(s), or the entity upon
behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

 

Signature  

 

  (Seal)

 

437816-3 (9.18.09)

Page 3 of 4

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EXHIBIT “A”

A Timeshare Estate, as defined in California Business and Professions Code
Section 11212(x)(i), being composed of Parcels A and B and as identified as
follows:

PARCEL A:

An undivided 1/12th interest in Club Interest Unit Number             , Club
Interest Number             , as described in that certain Declaration of
Covenants, Conditions and Restrictions and Reservations of Easements for the
Highlands Resort West Parcel Condominium, dated as of May 30, 2008 and recorded
June 9, 2008 as Instrument No. 2008-0046599-00 in the Official Records of the
County of Placer, State of California, as it may be amended from time to time
(the “Condominium Declaration”), as depicted on the “Amended Phase 1 Condominium
Plan for Lot 3 of Tract No. 961 in the Unincorporated area of the County of
Placer, State of California,” filed for record on September 28, 2009 as
Instrument No. 2009-0083292-00, in the Office of the County Recorder, County of
Placer, State of California, as amended and supplemented from time to time.

TOGETHER WITH an undivided 1/12th interest in all rights, restrictions,
privileges and easements appurtenant to said Unit.

TOGETHER WITH an undivided 1/12th share of the Common Areas allocated to said
Unit, as more specifically set forth in Exhibit “D” of the Condominium
Declaration.

PARCEL B:

(Include in Rotating Week legals) The exclusive right and easement to use and
occupy a              bedroom Unit Type, as a “Club Interest Owner,” further
described as Rotating Club Interest Number             , which includes the
right to use during two (2) weeks of rotating calendar use, identified as weeks
             and             , and one (1) Floating Week, identified as week
            , all as described in and subject to that certain Declaration of
Covenants, Conditions and Restrictions for Highlands Resort West Parcel Club,
dated as of May 30, 2008 and recorded June 9, 2008 as Instrument
No. 2008-0046600-00, in the Official Records of the County of Placer, State of
California, as it may be amended from time to time (the “Club Declaration”), and
subject to all rights, restrictions, privileges and easements set forth in the
Club Declaration.

(Include in Fixed Week legals) The exclusive right and easement to use and
occupy a              bedroom Unit Type, as a “Club Interest Owner,” during two
(2) weeks of fixed calendar use, identified as Fixed Weeks              and
            , and one (1) Floating Week, identified as week             , all as
described in and subject to that certain Declaration of Covenants, Conditions
and Restrictions for Highlands Resort West Parcel Club, dated as of May 30, 2008
and recorded June 9, 2008 as Instrument No. 2008-0046600-00, in the Official
Records of the County of Placer, State of California, as it may be amended from
time to time (the “Club Declaration”), and subject to all rights, restrictions,
privileges and easements set forth in the Club Declaration.

As more fully and particularly set forth in the Governing Instruments, to which
reference is made in the Club Declaration, the weeks that are identified in the
legal description for rotating use and floating use do not entitle the Club
Interest Owner to use and occupy a Club Interest Unit during those particular
weeks. Rotating use shall occur as set forth in the applicable Club Calendar and
floating use shall be unassigned until Purchaser reserves and has confirmed
usage, all in accordance with the Governing Instruments.

TOGETHER WITH non-exclusive easements for ingress, egress, use and enjoyment,
subject to the provisions of the Club Declaration, over the “Common Area” (as
the quoted term is defined in the Club Declaration), all as more particularly
set forth in Article II of the Club Declaration.

EXCEPTING FROM SAID PARCEL A, the exclusive right to use and occupy said Parcel
A during all “Use Periods” and “Maintenance Periods”, designated by the
association under Article VI of the Condominium Declaration.

 

437816-3 (9.18.09)

Page 4 of 4

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COLORADO SAMPLE (RCDC)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable dates for commencement of payments due hereunder, the monthly payment
date and the final payment date. DO NOT DESTROY THIS NOTE. When paid, this Note,
with the Deed of Trust securing the same, must be surrendered to the Trustee for
cancellation before release will be made.

IF THIS FORM IS USED IN A CONSUMER CREDIT TRANSACTION, CONSULT LEGAL COUNSEL.
THIS IS A LEGAL INSTRUMENT. IF NOT UNDERSTOOD, LEGAL, TAX OR OTHER COUNSEL
SHOULD BE CONSULTED BEFORE SIGNING.

 

PROMISSORY NOTE

 

                    , 20     

     Reference No.                       

US $                                    

                                          , CO                       

FOR VALUE RECEIVED, the undersigned                          (“Borrower”)
promises to pay to the order of THE RITZ-CARLTON DEVELOPMENT COMPANY, INC.,
whose address is P.O. Box 24747, Lakeland, FL 33802, (said party, or any other
party to whom this Note may be transferred and assigned, is hereinafter called
the “Note Holder”), or order, the principal sum of              and No/100 U.S.
Dollars (US $            ), together with interest on the unpaid balance from
the date of this Note, until paid, at the rate of              percent
(            %) per annum. Interest shall be calculated by applying the stated
annual rate against the unpaid principal for the actual number of days elapsed
divided by a 360-day year. Principal and interest shall be payable, without
offset, in lawful money of the United States at the Note Holder’s address set
forth above, or such other place as the Note Holder may, from time to time,
designate, in              consecutive monthly installments of             
No/100 U.S. Dollars (US $            ), beginning on the              day of
            , 20__, and continuing thereafter on the same day of each month,
with the remaining unpaid balance, together with accrued interest thereon, due
and payable, if not sooner paid, on             .

Each monthly payment shall be tendered with a $8.75 service fee. Borrower shall
pay to the Note Holder a late charge of five percent (5%) for any monthly
installment not received by the Holder within ten (10) days after the date the
installment is due. Such late charge is in addition to, and not in lieu of or
diminution of, any other rights and remedies of the Note Holder under this Note,
OR APPLICABLE LAW. Each monthly payment will be applied in the order specified
in the Deed of Trust.

The Principal balance may be prepaid, in whole or in part at any time, or from
time to time, without penalty. Any prepayment shall include interest to the date
the prepayment is made. Partial prepayments shall be applied to the installments
in the inverse order of their maturity. There will be no changes in the due date
or in the amount of the monthly payment unless the Note Holder agrees in writing
to those changes.

The makers, sureties, guarantors and endorsers hereof severally waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Note Holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution. This Note shall be the joint and
several obligations of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their respective heirs, personal representatives,
successors and assigns. All persons or entities signing this Note waive any
rights which they might otherwise have under Section 13-50-101, 13-50-102, or
13-50-103, Colorado Revised Statutes (or under any corresponding current or
future law) by reason of any release of fewer than all of the parties of this
Note.

The indebtedness evidenced by this Note is secured by a Deed of Trust, dated of
even date herewith, and until released, said Deed of Trust contains additional
rights of the Note Holder. Such rights may cause Acceleration of the
indebtedness evidenced by this Note, as described below. Reference is made to
said Deed of Trust for such additional terms. Said Deed of Trust grants the Note
Holder rights in the Property identified as follows:

An undivided              interest in Fractional Unit             , as described
in that certain Declaration of Fractional Ownership Plan for WDL Vail Club,
recorded October 25, 2010, at Reception No. 201021513 as amended and
supplemented from time to time (the “Fractional Declaration”) and in that
certain Condominium Declaration for WDL Vail, recorded September 10, 2010, at
Reception No. 201017882 as amended and supplemented from time to time (the
“Condominium Declaration”) and according to the Map for WDL Vail recorded
September 10, 2010, at Reception No. 201017883 as amended and supplemented from
time to time (the “Condominium Map”), all in the office of the Clerk and
Recorder of Eagle County, Colorado, including an undivided              interest
in, and subject to, all rights, restrictions, privileges and

 

1

--------------------------------------------------------------------------------

easements appurtenant to said Fractional Unit. The Fractional Interest includes
rights to use and occupy a Fractional Unit in accordance with the Governing
Instruments (as defined in the Fractional Declaration), and is initially subject
to the Club Membership Program

known as The Ritz-Carlton Club Membership Program with a Usage Program which
provides for a Club Allocation for the use of twenty-one (21) days per year in
accordance with the Governing Instruments.

The Club Membership Program Documents further describe the Fractional Interests
as:

Interest Number             , providing three (3) weeks of use pursuant to the
Governing Instruments, and subject to all rights, restrictions, privileges and
easements set forth in the Fractional Declaration.

At the option of the Note Holder, the entire unpaid principal amount outstanding
and accrued interest thereon shall become due and payable without demand or
further notice to Borrower upon: (a) failure of Borrower to pay when due any
monthly installment payable hereunder which remains unpaid after a date
specified in a notice (not less than thirty (30) days from the date such notice
is mailed) from the Note Holder to Borrower; (b) the insolvency (however
evidenced), or the institution, of proceedings in bankruptcy by or against
Borrower; (c) the sale (or lease with option to purchase) or transfer of all or
any part of the Property or any interest therein without the prior written
consent of the Note Holder, excluding a transfer by devise, descent or by
operation of law upon the death of a joint tenant therein; (d) a casualty or
condemnation of the Property without restoration as described in the Deed of
Trust; or (e) failure of Borrower(s) to comply with the covenants of the Deed of
Trust after notice and failure to cure (if applicable) as provided in the Deed
of Trust.

The Note Holder may exercise its option to accelerate during any default by
Borrower regardless of any prior forbearance. If this Note is not paid when due,
whether at maturity or by acceleration, the Note Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, attorney fees, whether or not action be instituted hereon.

Any notice to Borrower provided for in this Note shall be deemed to have been
given after mailing same by U.S. mail, postage prepaid (or such other more
expeditious method as may be appropriate in the case of foreign addressees, as
Note Holder may choose in its discretion), addressed to Borrower at the address
stated below, or to such other address as Borrower may designate by written
notice to the Note Holder. Any notice to the Note Holder shall be deemed to have
been given by mailing such notice by U.S. certified mail, return receipt
requested, (or in the case of a notice originating in a foreign country, by such
other method that results in the Note Holder acknowledging in writing receipt of
the notice), at 1200 US Hwy 98 S. Ste. 10, Lakeland, FL 33801, or at such other
address as may be designated by written notice to Borrower.

“Borrower” and “Note Holder” as used herein, includes all parties shown as such.
Whenever the context permits, singular shall include plural and one gender shall
include all.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Note Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Note Holder or
if this Note is prepaid prior to maturity, all unearned interest, if any, shall
be canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Note Holder; (ii) the aggregate of all interest and other
charges constituting interest under applicable law, and contracted for,
chargeable or receivable under this Note or otherwise in connection with this
loan transaction shall neither exceed the maximum amount of interest, nor
produce a rate in excess of the maximum non-usurious rate of interest that Note
Holder may charge Borrower(s) under applicable law and in regard to which
Borrower(s) may not successfully assert the claim or defense of usury; and
(iii) if any excess interest is provided for or collected, it shall be deemed a
mistake and the same shall either be refunded to Borrower(s) or be credited on
the unpaid principal amount hereof, and this Note shall be automatically deemed
reformed so as to permit only the collection of the maximum non-usurious rate
and amount of interest allowable under applicable law.

This Note shall be governed by, construed under, and enforced in accordance
with, the laws of the State of Colorado. Borrower consents to jurisdiction and
venue in the state and federal courts within the State of Colorado.

 

440719-2

9.30.10

   2   

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[CAUTION: SIGN ORIGINAL NOTE ONLY/RETAIN COPY]

 

    BORROWER’S ADDRESS:          

Borrower

 

     

Borrower

 

     

Borrower

 

     

KEEP THIS NOTE IN A SAFE PLACE. THE ORIGINAL OF THIS NOTE MUST BE EXHIBITED TO
THE PUBLIC TRUSTEE IN ORDER TO RELEASE A DEED OF TRUST SECURING PAYMENT PURSUANT
TO THIS NOTE.

THIS NOTE (AND THE DEED OF TRUST SECURING THE SAME) CONTAINS ACCELERATION
PROVISIONS.

 

440719-2

9.30.10

   3   

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COLORADO SAMPLE (RCDC)

After Recording Return To:

           

IF THIS FORM IS USED IN A CONSUMER CREDIT TRANSACTION, CONSULT LEGAL COUNSEL.
THIS IS A LEGAL INSTRUMENT. IF NOT UNDERSTOOD, LEGAL, TAX OR OTHER COUNSEL
SHOULD BE CONSULTED BEFORE SIGNING.

UPON CLOSING OF THE PURCHASE TO WHICH THIS PURCHASE MONEY DEED OF TRUST
APPERTAINS, THE UNDERSIGNED HEREBY AUTHORIZES CLOSING AGENT TO COMPLETE THIS
PURCHASE MONEY DEED OF TRUST BY INSERTING THE APPLICABLE DATES.

 

 

PURCHASE MONEY DEED OF TRUST

THIS DEED OF TRUST, made this                 , 20        , by the Grantor
                                                                         
(hereinafter, “Borrower”), whose address is
                                        , to the Public Trustee of Eagle County,
Colorado (“Trustee”) for the benefit of the Lender, THE RITZ-CARLTON DEVELOPMENT
COMPANY, INC., a Delaware corporation, whose legal address is P.O. Box 24747,
Lakeland, FL 33802 (hereinafter, “Lender”). (“Borrower” as used herein, includes
all parties shown as such. Whenever the context permits, singular shall include
plural and one gender shall include all.)

WHEREAS, Borrower is indebted to Lender in the principal sum of
                                                                          U.S.
Dollars (US $                                 ), which indebtedness is evidenced
by Borrower’s Promissory Note of even date herewith (“Note”), providing for
equal monthly installments of principal and interest, with the balance of the
indebtedness, due and payable, if not sooner paid, on
                                    .

This Deed of Trust is given to secure to Lender (i) the repayment of the
indebtedness evidenced by the Note, with interest thereon, the repayment of all
other sums, with interest thereon, advanced in accordance herewith to protect
the security of this Deed of Trust, and the performance of the covenants and
agreements of Borrower herein contained, (ii) the repayment of any future
advances, with interest thereon, made to Borrower by Lender pursuant to
paragraph 20 hereof (“Future Advances”) and (iii) the performance of the
covenants and agreements of Borrower herein contained, Borrower irrevocably
grants, conveys, transfers, assigns and warrants to Trustee, IN TRUST FOREVER,
for the benefit of Lender, with power of sale, the following-described property
located in the County of Eagle, State of Colorado (the “Property”):

An undivided                      interest in Fractional Unit                 ,
as described in that certain Declaration of Fractional Ownership Plan for WDL
Vail Club, recorded October 25, 2010, at Reception No. 201021513 as amended and
supplemented from time to time (the “Fractional Declaration”) and in that
certain Condominium Declaration for WDL Vail, recorded September 10, 2010, at
Reception No. 201017882 as amended and supplemented from time to time (the
“Condominium Declaration”) and according to the Map for WDL Vail recorded
September 10, 2010, at Reception No. 201017883 as amended and supplemented from
time to time (the “Condominium Map”), all in the office of the Clerk and
Recorder of Eagle County, Colorado, including an undivided                 
interest in, and subject to, all rights, restrictions, privileges and easements
appurtenant to said Fractional Unit. The Fractional Interest includes rights to
use and occupy a Fractional Unit in accordance with the Governing Instruments
(as defined in the Fractional Declaration), and is initially subject to the Club
Membership Program known as The Ritz-Carlton Club Membership Program with a
Usage Program which provides for a Club Allocation for the use of twenty-one
(21) days per year in accordance with the Governing Instruments.

The Club Membership Program Documents further describe the Fractional Interests
as:

Interest Number                     , providing three (3) weeks of use pursuant
to the Governing Instruments, and subject to all rights, restrictions,
privileges and easements set forth in the Fractional Declaration.

Borrower covenants that Borrower is lawfully seized of the estate hereby
conveyed and has the right to mortgage, grant and convey the Property, that the
Property is unencumbered, and that Borrower will warrant and defend generally
the title to the Property against all claims and demands, subject to any
declaration, easements, or restrictions listed in a schedule of exceptions to
coverage in any title insurance policy insuring Lender’s interest in the
Property. Borrower further agrees and covenants to abide by the terms and
provisions attached hereto and incorporated herein by reference.

 

   Page 1 of 6    440722v2       Borrower Initials                         
9.30.10      

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IN WITNESS WHEREOF, Borrower has executed this Deed of Trust.

 

          Borrower     Borrower           Borrower     Borrower

STATE OF                                              )

COUNTY OF                                         )

This foregoing instrument was acknowledged before me this                     
day of                     , 20      , by
                                             .

WITNESS my hand and official seal.

My Commission Expires:                                         

 

   Notary Public

 

   Page 2 of 6    440722v2       Borrower Initials                         
9.30.10      

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ADDITIONAL COVENANTS AND TERMS

Borrower and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower shall
promptly pay when due all payments due under the Note. Except as otherwise
provided by applicable law, all payments accepted and applied by Lender under
the Note and Sections 1 and 2 hereof, shall be applied in the following order of
priority: (a) amounts due under Section 2 hereof, (b) amounts due under
Section 7 hereof; (c) costs, fees, expenses and other amounts incurred and
advanced by the Lender in enforcement of its rights under the Note and this Deed
of Trust including, without limitation, reasonable attorney’s fees, (d) unpaid
service fees due under the Note; (e) interest due under the Note; (f) principal
due under the Note; (g) unpaid late charges, if any; (h) interest due under
Section 20 hereof and then (i) principal due under Section 20 hereof.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower, Borrower shall pay to Lender on the day
when monthly installments of principal and interest are payable under the Note,
until the Note is paid in full, a sum (herein “Funds”) equal to one-twelfth of
the annual expenses for taxes, assessments and insurance, including, without
limitation, for (i) Basic Assessments, (ii) assessments of every kind and
nature, (iii) Membership Dues pertaining to the Ritz-Carlton Membership Program,
(iv) insurance premiums, and (v) any other amount due (“Common Expenses”) under
the Condominium Declaration or the Fractional Declaration, all as reasonably
estimated initially and from time to time by Lender on the basis of assessments
and bills and reasonable estimates thereof.

If Lender exercises the foregoing right, the Funds shall be held in an
institution, the deposits or accounts of which are insured or guaranteed by a
federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, insurance premiums
and Common Expenses. Lender may not charge for so holding and applying the
Funds, analyzing said account, or verifying and compiling said assessments and
bills, unless Lender pays to Borrower interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower any interest on earnings on the Funds.
Lender shall give to Borrower, without charge, an annual accounting of the Funds
showing credits and debits to the Funds and the purposes for which each debit to
the Funds was made. The Funds are hereby pledged as additional security for the
sums secured by this Deed of Trust.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments,
insurance premiums and Common Expenses, shall exceed the amount required to pay
such taxes, assessments, insurance premiums and Common Expenses as they fall
due, such excess shall be, at Borrower’s option, either promptly repaid to
Borrower or credited to Borrower on monthly installments of future Funds. If the
amount of the Funds held by Lender shall not be sufficient to pay taxes,
assessments, insurance premiums and Common Expenses as they fall due, Borrower
shall pay to Lender any amount necessary to make up the deficiency within thirty
(30) days from the date of a notice mailed by Lender to Borrower requesting
payment thereof.

Upon payment in full of all sums secured by this Deed of Trust, Lender shall
promptly refund to Borrower any funds held by Lender. If, under paragraph 17
hereof, the Property is sold or the Property is otherwise acquired by Lender,
Lender shall apply, no later than immediately prior to the sale of the Property
or its acquisition by Lender, any Funds then held by Lender as a credit against
the sums secured by this Deed of Trust.

 

3. THIS PARAGRAPH INTENTIONALLY LEFT BLANK.

4. Charges; Liens. Borrower shall promptly pay, when due, all Club dues imposed
by the WDL Vail Condominium Association, Inc. (the “Condominium Association”) or
the WDL Vail Club Association, Inc. (the “Fractional Association”) pursuant to
the provisions of the Condominium Declaration, or its associated bylaws, rules
and regulations, the Fractional Declaration or its associated bylaws, rules and
regulations, or other constituent documents applicable to the Property
(collectively, the “Project Documents”). Borrower shall pay all taxes,
assessments and other charges, fines and impositions attributable to the
Property which may attain a priority over this Deed of Trust, in the manner
provided under paragraph 2 hereof or, if not paid in such manner, by Borrower
making payment, when due, directly to the payee thereof. Borrower shall promptly
furnish to Lender all notices of amounts due under this paragraph, and in the
event Borrower shall make payment directly, Borrower shall promptly furnish to
Lender receipts evidencing such payments. Borrower shall promptly discharge any
lien which has priority over this Deed of Trust; provided, that Borrower shall
not be required to discharge any such lien so long as Borrower shall agree in
writing to the payment of the obligation secured by such lien in a manner
acceptable to Lender and if requested by Lender, immediately post with Lender an
amount necessary to satisfy said obligation, or shall in good faith contest such
lien by, or defend enforcement of such lien in, legal proceedings which operate
to prevent the enforcement of such lien or forfeiture of the Property or any
part thereof and, if requested by Lender, immediately post with Lender an amount
necessary to satisfy said obligation.

5. Hazard Insurance. Borrower shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Deed of Trust.
This obligation shall be deemed satisfied so long as the Condominium Association
or Fractional Association maintains “master” or “blanket” policies for liability
and casualty insurance in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower or the
Condominium Association or Fractional Association subject to approval by Lender;
provided, however, that such approval shall not be unreasonably withheld. If
required, all premiums on insurance policies shall be paid in the manner
provided under paragraph 2 hereof, or, if not paid in such manner, by Borrower
or the Condominium Association or Fractional Association making payment, when
due, directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower shall give Lender prompt notice of any lapse in
hazard insurance coverage. In the event of loss, Borrower shall give prompt
notice to the insurance carrier and Lender. Lender may make proof of loss if not
made promptly by Borrower. If the Borrower has a right to vote in the
Condominium Association or Fractional Association in connection with a decision
regarding restoration, Borrower shall notify Lender of the vote and shall vote
as directed by Lender or deliver a proxy or power of attorney to Lender for such
vote, at Lenders’s election. Without limiting the generality of the foregoing,
Borrower shall not vote to terminate the condominium (whether in connection with
a casualty or otherwise) without Lender’s prior written consent. In the event
the Property is not restored, Lender shall have a right to accelerate the
indebtedness.

Pursuant to the terms of the Project Documents, insurance proceeds shall be
applied to restoration or repair of the Property damaged, whether to the unit or
the common elements. To the extent such insurance proceeds exceed the cost of
such restoration or repair and the Board of Directors of the Condominium
Association or Fractional Association decides to disburse such excess,
Borrower’s share of such excess shall be applied to the sums secured by this
Deed of Trust, with the excess, if any, paid to Borrower.

 

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Unless Lender and Borrower otherwise agree in writing, any such application of
proceeds to principal shall not exceed or postpone the due date of the monthly
installments referred to in paragraphs 1 and 2 hereof, or change the amount of
such installments. If under paragraph 22 hereof the Property is acquired by
Lender, all right, title and interest of Borrower in and to any insurance
policies and in and to any excess insurance proceeds thereof from damage to the
Property prior to the sale or acquisition, shall pass to Lender to the extent of
the sums secured by this Deed of Trust immediately prior to such sale or
acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower shall perform all of Borrower’s
obligations under the Project Documents. Borrower shall take such actions as may
be reasonable to insure that the Condominium Association or Fractional
Association maintains a public liability insurance policy acceptable in form,
amount, and extent of coverage to Lender. If a condominium rider is executed by
Borrower and recorded together with the Deed of Trust, the covenants and
agreements of such rider shall be incorporated into and shall amend and
supplement the covenants and agreements of this Deed of Trust as if the rider
were a part hereof.

7. Protection of Lender’s Security. If Borrower fails to perform the covenants
and agreements contained in this Deed of Trust, or if any action or proceeding
is commenced which materially affects Lender’s interest in the Property,
including, but not limited to, eminent domain, insolvency, code enforcement, or
arrangements or proceedings involving a bankrupt or decedent, then Lender at
Lender’s option, upon notice to Borrower, if required by law, may make such
appearances, disburse such sums and take such action as is necessary to protect
Lender’s interest, including, but not limited to, disbursement of funds to pay
reasonable attorney fees and entry upon the Property to make repairs, and
payment of:

(a) any general or special taxes or ditch or water assessments levied or
accruing against the Property;

(b) the premiums on any insurance necessary to protect any improvements
comprising a part of the Property;

(c) sums due on any lien or encumbrance on the Property;

(d) the reasonable costs and expenses of defending, protecting, and maintaining
the Property and Lender’s interest in the Property, receiver’s fees and
expenses, inspection fees, appraisal fees, court costs, attorney fees and costs,
and fees and costs of an attorney in the employment of Lender or holder of the
certificate of purchase;

(e) all other costs and expenses allowable by the Note or this Deed of Trust;
and

(f) such other costs and expenses which may be authorized by a court of
competent jurisdiction.

Borrower hereby assigns to Lender any right Borrower may have by reason of any
encumbrance on the Property or by law or otherwise to cure any default under
said encumbrance.

Any amounts disbursed by Lender pursuant to this paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower secured by this Deed
of Trust. Unless Borrower and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower requesting payment
thereof, and shall bear interest from the date of disbursement at the rate
payable from time to time on outstanding principal under the Note unless payment
of interest at such rate would be contrary to applicable law, in which event
such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon, and
inspections to, the Property, provided that Lender shall give Borrower notice
prior to any such inspection specifying reasonable cause therefor related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower in connection with any condemnation or other
taking of all or part of the Property, whether of the unit or the common
elements or for any conveyance in lieu of condemnation, pursuant to the terms of
the Project Documents, shall be applied to the sums secured by this Deed of
Trust, with the excess, if any, paid to Borrower.

Unless Lender and Borrower otherwise agree in writing, any such application of
proceeds to principal shall not extend or postpone the due date of the monthly
installments referred to in paragraphs 1 and 2 hereof, or change the amount of
such installments.

10. Borrower Not Released. Extension of the time for payment or modification of
amortization of the sums secured by this Deed of Trust granted by Lender to any
successor in interest of Borrower, shall not operate to release, in any manner,
the liability of the original Borrower and Borrower’s successors in interest.
Lender shall not be required to commence proceedings against such successor or
refuse to extend time for payment or otherwise modify amortization of the sums
secured by this Deed of Trust by reason of any demand made by the original
Borrower and Borrower’s successor in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder or otherwise afforded by applicable law, shall not
be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Deed of Trust.

12. Remedies Cumulative. All remedies provided in this Deed of Trust are
distinct and cumulative to any other right or remedy under this Deed of Trust or
afforded by law or equity, and may be exercised concurrently, independently or
successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower. All covenants and
agreements of Borrower shall be joint and several. The captions and headings of
the paragraphs of this Deed of Trust are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower provided for in this Deed of Trust
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower at the Borrower’s address as set forth in the Note, or at such other
address as Borrower may designate by notice to Lender as provided herein, and
(b) any notice to Lender shall be given by certified mail, return receipt
requested, to Lender’s address stated herein or to such other address as Lender
may designate by notice to Borrower as provided herein. Any notice that is
provided for in this Deed of Trust shall be deemed to have been given to
Borrower or Lender when given in the manner designated herein.

15. Governing Law; Severability. The laws of the State of Colorado shall govern
this Deed of Trust. In the event that any provision or clause of this Deed of
Trust or the Note conflicts with applicable law, such conflict shall not affect
other provisions of the Deed of Trust or the Note which can be given effect
without the conflicting provision, and to this end the provisions of the Deed of
Trust and the Note are declared to be severable.

16. Borrower’s Copy. Borrower acknowledges receipt of a copy of the Note and
this Deed of Trust.

17. Transfer of the Property; Assumption. The following events shall be referred
to herein as a “Transfer”: (i) a transfer or conveyance of title (or any portion
thereof, legal or equitable) of the Property (or any part thereof or interest
therein), (ii) the execution of a contract or agreement creating a right to
title (or any portion thereof, legal or equitable) in the Property (or any part
thereof or interest therein), (iii) an agreement granting a possessory right in
the Property (or any portion thereof), in excess of 3 years, (iv) a sale or
transfer of, or the execution of a contract or agreement creating a right to
acquire or receive, more than fifty percent (50%) of the

 

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controlling interest or more than fifty percent (50%) of the beneficial interest
in Borrower, (v) the reorganization, liquidation or dissolution of Borrower. Not
to be included as a Transfer are (i) the creation of a lien or encumbrance
subordinate to this Deed of Trust, (ii) the creation of a purchase money
security interest for household appliances, or (iii) a transfer by devise,
descent or by operation of the law upon the death of a joint tenant. At the
election of Lender, in the event of each and every Transfer:

(a) All sums secured by this Deed of Trust shall become immediately due and
payable.

(b) If a Transfer occurs and should Lender not exercise Lender’s option pursuant
to this paragraph 17 to accelerate, the transferee shall be deemed to have
assumed all of the obligations of Borrower under this Deed of Trust including
all sums secured hereby whether or not the instrument evidencing such
conveyance, contract or grant expressly so provides. This covenant shall run
with the Property and remain in full force and effect until said sums are paid
in full. Lender may without notice to Borrower deal with the transferee in the
same manner as with Borrower with reference to said sums including the payment
or credit to the transferee of disbursed reserve Funds on payment in full of
said sums, without in any way altering or discharging Borrower’s liability
hereunder for the obligations hereby secured.

(c) Should Lender not elect to accelerate upon the occurrence of such Transfer
then, subject to (b) above, the mere fact of a lapse of time or the acceptance
of payment subsequent to any of such events, whether or not Lender had actual or
constructive notice of such Transfer, shall not be deemed a waiver of Lender’s
right to make such election nor shall Lender be estopped therefrom by virtue
thereof. The issuance on behalf of Lender of a routine statement showing the
status of the loan, whether or not Lender had actual or constructive notice of
such Transfer, shall not be a waiver or estoppel of Lender’s said rights.

18. Acceleration; Foreclosure; Other Remedies. Except as provided in paragraph
17 hereof and except as provided in the Note, upon Borrower’s breach of any
non-monetary covenant or agreement of Borrower in this Deed of Trust, Lender,
prior to acceleration, shall mail notice to Borrower, as provided in paragraph
14 hereof, specifying: (a) the breach; (b) the action required to cure such
breach; (c) a date, not less than fifteen (15) days from the date the notice is
mailed to Borrower by which such breach must be cured; and (d) that failure to
cure such breach on or before the date specified in the notice may result in
acceleration of the sums secured by this Deed of Trust, foreclosure by judicial
proceeding and sale of Property. If the breach is not cured on or before the
date specified in the notice, including (without limitation) payment of all
costs, expenses, late charges, attorney’s fees and other fees incurred, Lender,
at Lender’s option, subject to any right of reinstatement to which Borrower is
entitled under applicable law, may declare, without further demand, all of the
sums secured by this Deed of Trust to be immediately due and payable. Upon a
breach or default under paragraph 17, a monetary default, or the occurrence of
certain other events as specified in the Note, Lender may accelerate the
indebtedness and declare the entire outstanding balance due and payable without
notice to Borrower. Following a breach or default, Lender may invoke the power
of sale and Lender shall have the right to bring an action in any court of
competent jurisdiction to foreclose this Deed of Trust, or to foreclose this
Deed of Trust through the Trustee in accordance with Section 38-38-100.3 et.seq.
of the Colorado Revised Statutes by filing a written Notice of Election and
Demand for Sale with Trustee, or to pursue any other remedies permitted by law.
Lender shall be entitled to collect in such proceedings all costs and expenses,
including all expenses of foreclosure, and including, but not limited to,
reasonable attorney fees, court costs, and costs of documentary evidence,
abstracts and title reports. Borrower shall release Lender, the Condominium
Association and the management company from any claims in connection with the
exercise by Lender of remedies herein described.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower hereby assigns to Lender the rents of the Property, provided
that Borrower shall, prior to acceleration by the Lender under paragraph 18
hereof, or abandonment of the Property, have the right to collect and retain
such rents as they become due and payable. Upon acceleration or abandonment of
the Property, Lender shall be entitled, without notice, to enter upon, take
possession of and manage the Property and to collect the rents of the Property,
including those that are past due. Such assignment of the rents shall remain in
full force and effect during any period of foreclosure with respect to the
Property. All rents collected shall be appointed first to payment of the costs
of management of the Property and collection of rents, including, but not
limited to, management fees, court costs, and reasonable attorney fees, and then
to the sum secured by this Deed of Trust. The Lender shall be liable to account
only for those rents actually received. Borrower shall not be entitled to
possession or use of the Property after abandonment or after the Lender has
accelerated the balance due. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Property. Lender or the holder of
the Trustee’s certificate of purchase shall be entitled to a receiver for the
Property after acceleration under paragraph 18 (Acceleration; Foreclosure; Other
Remedies), and shall also be so entitled during the time covered by foreclosure
proceedings and the period of redemption, if any; and shall be entitled thereto
as a matter of right without regard to the solvency or insolvency of Borrower or
of the then owner of the Property, and without regard to the value therof. Such
receiver may be appointed by any Court of competent jurisdiction upon ex parte
application and without notice; notice being hereby expressly waived. If a
receiver is appointed, any income from rents from the Property shall be applied
first to the costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower, Lender, at Lender’s option, may
make Future Advances to Borrower. Such Future Advances, with interest thereon,
shall be secured by this Deed of Trust whether or not evidenced by promissory
notes stating that said notes are secured hereby. At no time shall the principal
amount of the indebtedness secured by this Deed of Trust, not including sums
advanced in accordance herewith to protect the security of this Deed of Trust,
exceed one hundred fifty percent (150%) of the original principal amount of the
Note.

21. Lender’s Prior Consent. Borrower shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to: (a) the abandonment or termination of the applicable
condominium or fractional interest regime; (b) any amendment to any provision of
the Project Documents which is for the express benefit of Lender; or (c) any
action which would have the effect of rendering the public liability insurance
coverage maintained by the Condominium Association or Fractional Association
unacceptable to Lender.

22. Remedies. In the event Borrower defaults in payment of the loan evidenced by
the Note secured hereby, or in the performance of any covenants herein set
forth, then the Lender shall have all legal and equitable remedies available to
it under Colorado law. In addition, Lender shall have the automatic right,
without the appointment of a receiver, to have access to and exclusive
possession of the Fractional Unit (as defined in the Fractional Declaration)
encumbered hereby or such other Fractional Unit whose use has been assigned to
Borrower by the Condominium Association or Fractional Association or by any
exchange company. This right to exclusive occupancy and possession shall
entitle, but shall not obligate, Lender to receive and retain any rental
payments to which Borrower would otherwise be entitled, which are received by
Lender or any of its related companies, or by the Condominium Association or
Fractional Association or any other rental agent.

Lender may implement the remedies provided herein by, among other methods,
giving notice of default to the Borrower, the Condominium Association or
Fractional Association and the management company responsible for the
administration and management of the Property encumbered hereby.

 

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If the Borrower fails to deliver to Lender and to the management company an
affidavit setting forth facts contesting the default alleged by Lender prior to
the date Borrower’s confirmed Reserved Allocation or confirmed usage based on
availability (Unreserved Allocation) commences, then the management company
shall thereupon be entitled to deliver possession of the Fractional Unit or the
rental, net only of any rental management fee, if any, to Lender. Borrower shall
release Lender, the Condominium Association and the Fractional Association and
the management company from any claims in connection with the exercise by Lender
of remedies herein described.

23. Waiver of Jury Trial. BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED ON THIS DEED OF TRUST, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS DEED OF TRUST OR ANY AGREEMENT CONTEMPLATED TO BE EXECUTED
IN CONNECTION WITH THIS DEED OF TRUST, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH
RESPECT HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER’S
ACCEPTING THIS DEED OF TRUST FROM BORROWER.

24. Attorney Fees. As used in this Deed of Trust and in the Note, “attorney
fees” shall include attorney fees, if any, which may be awarded by a trial or
appellate court.

25. Waiver of Exemptions. Borrower hereby waives all right of homestead and any
other exemption in the Property under state or federal law presently existing or
hereafter enacted.

 

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FLORIDA SAMPLE (RCDC)

[UPON CLOSING OF THE PURCHASE TO WHICH THIS NOTE APPLIES, THE UNDERSIGNED HEREBY
AUTHORIZE(S) CLOSING AGENT OR HOLDER TO COMPLETE THIS NOTE BY INSERTING THE DATE
OF THE NOTE AND APPLICABLE DATES FOR COMMENCEMENT OF PAYMENTS DUE HEREUNDER, THE
MONTHLY PAYMENT DATE AND THE FINAL PAYMENT DATE.]

NOTE SECURED BY MORTGAGE

Club Home No(s)/ Club Home Interest
No(s):                                             

Eagle Tree Condominium

 

US$                         

                                       , 20      

FOR VALUE RECEIVED, the undersigned                                          
   (“Borrower(s)”) promise(s) to pay to the order of The Ritz-Carlton
Development Company, Inc. (“RCDC”) (said party or any other party to whom (RCDC)
may transfer and assign this Note and who holds this Note from time to time is
hereinafter called the “Holder”), 6649 Westwood Boulevard, Orlando, Florida
32821, or order, the principal sum of                                          
        U.S. Dollars (US $                    ), with interest on the unpaid
balance from                                 , until paid, at the rate of
                         percent per annum (        %) (based on a 360-day year
and on the assumption that payments are made when due). Principal and interest
shall be payable in lawful money of the United States at the Holder’s address
set forth above, or such other place as the Holder may, from time to time,
designate, in consecutive monthly installments of
                                         U.S. Dollars (US $
                    ), on the          day of each month and continuing
thereafter on the same day of each month beginning                         , for
a period of          months with the remaining unpaid principal balance,
together with accrued interest thereon, due and payable, if not sooner paid, on
                                        .

The indebtedness evidenced by this Note is secured by a Mortgage, dated of even
date herewith, creating a lien on the real property described therein (the
“Property”). Reference is made to said Mortgage for rights as to acceleration of
the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a $8.75 service fee.

Borrower(s) shall pay to the Holder a late charge of six percent (6%) for any
monthly installment not received by the Holder within ten (10) days after the
date the installment is due. The late charge will be deducted from the next
payment received.

Each payment shall be credited first to amounts due, pursuant to Paragraph 2 of
the Mortgage, then to advances, if any, made by the Lender pursuant to Paragraph
7 of the Mortgage, then to the costs, fees, expenses and other amounts incurred
and advanced by the Holder in the enforcement of its rights hereunder,
including, without limitation, costs and reasonable attorney’s fees, then to
unpaid service fees, then to interest due hereunder, then to principal due
hereunder, then to unpaid late charges, if any, than to interest on any Future
Advances.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Demand, presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be a joint
and several obligation of all makers, sureties, guarantors and endorsers, and
shall be binding upon them and their heirs, personal representatives, successors
and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon any one of the following events of default:

 

  a) failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
thirty (30) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) failure of Borrower(s) to perform any other covenant or agreement of
Borrower(s) in this Note or the Mortgage within thirty (30) days after the
mailing of notice from the Holder to the Borrower(s) specifying the nature of
such failure; and

 

  c) the insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s) as otherwise provided herein.

The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, reasonable attorney’s fees, whether or not action be instituted
hereon, and costs of trial and appellate proceedings.

In the event of any default by the Borrower(s) hereunder, Holder at its sole
option, may charge the Borrower(s) the highest interest rate allowed by law
and/or pursue any and all remedies available to it under applicable law.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given upon depositing same in any U.S. post office, postage prepaid, addressed
to Borrower(s) at the address stated below, or to such other address as
Borrower(s) may designate by written notice to the Holder. Any notice to the
Holder shall be given by mailing such notice by certified mail, return receipt
requested, to the Holder at the address stated in the first paragraph of this
Note, or at such other address as may have been designated by written notice to
Borrower(s). Any notice provided for in this Note shall be deemed to have been
given to Borrower(s) or the Holder when given in the manner herein designated.

THIS NOTE SHALL BE GOVERNED BY, CONSTRUED UNDER AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA AND THE COURTS OF THE STATE OF
FLORIDA IN THE COUNTY OF PALM BEACH SHALL BE THE EXCLUSIVE COURTS OF
JURISDICTION AND VENUE FOR ANY LITIGATION OR OTHER PROCEEDING THAT MAY BE BASED
ON, ARISE OUT OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, UNLESS OTHERWISE
REQUIRED BY LAW. HOLDER AND BORROWER(S) HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONJUNCTION WITH THIS
NOTE, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR
WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR
HOLDER EXTENDING THE LOAN EVIDENCED BY THIS NOTE.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

Time is of the essence in the performance of each and every obligation
represented by this Note.

BORROWER’S ADDRESS:

 

              Borrower/Purchaser signs here               Borrower/Purchaser
signs here               Borrower/Purchaser signs here              
Borrower/Purchaser signs here

(Execute Original Only)

DOCUMENTARY STAMP TAXES HAVE BEEN PAID AND THE PROPER AMOUNTS AFFIXED TO THE
MORTGAGE

 

500974_2 (11.24.09)

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FLORIDA SAMPLE (RCDC)

UPON CLOSING OF THE PURCHASE TO WHICH THIS MORTGAGE APPLIES, THE UNDERSIGNED
HEREBY AUTHORIZES CLOSING AGENT TO COMPLETE THIS MORTGAGE BY INSERTING THE
APPROPRIATE DATE OF THE MORTGAGE AND TO COMPLETE, AS NECESSARY, THE RECORDING
INFORMATION RELATING TO THE DOCUMENTS BY WHICH THE TIME-SHARE ESTATE(S) BEING
ENCUMBERED BY THIS MORTGAGE WAS(WERE) CREATED.

(INDIVIDUAL)

MORTGAGE

 

THIS MORTGAGE is made this                                 , between the
Mortgagor(s),                                                                  
                                         
                                         
                                                (herein “Borrower(s)”), whose
post office address is c/o The Ritz-Carlton Management Company, LLC, 6649
Westwood Boulevard, Orlando, Florida 32821, County of Orange, State of Florida,
and the Mortgagee, The Ritz-Carlton Development Company, Inc., a Delaware
corporation, the address of which is 6649 Westwood Boulevard, Orlando, Florida
32821 (said party, its successors and assigns is herein called “Lender”).

WHEREAS, Borrower(s) is/are indebted to Lender in the principal sum of
                                                                      U.S.
Dollars (US$                    ), which indebtedness is evidenced by Borrower’s
Note of even date herewith (herein “Note”), providing for monthly installments
of principal and interest, with the balance of indebtedness, if not sooner paid,
due and payable                              months from the date hereof.

TO SECURE to Lender (a) the repayment of the indebtedness evidenced by the Note,
with interest thereon, the payment of all other sums, with interest thereon,
advanced in accordance herewith to protect the security of this Mortgage, and
the performance of the covenants and agreements of Borrower(s) herein contained,
and (b) the repayment of any future advances, with interest thereon, made to
Borrower(s) by Lender pursuant to Paragraph 20 hereof (herein “Future
Advances”), Borrower(s) does hereby mortgage, grant and convey to Lender and
Lender’s successors and assigns the following described property located in the
County of Palm Beach, State of Florida:

Club Home Interest (s)                      each consisting of an undivided 1/8
fee simple interest as tenant-in-common in Club Home (s)                      of
EAGLE TREE CONDOMINIUM, according to the Declaration of Condominium for EAGLE
TREE CONDOMINIUM, recorded September 2, 2003 in Official Records Book 15778, at
Page 0022, in the Public Records of Palm Beach County, Florida, as amended and
supplemented from time to time (“Declaration”).

TO HAVE AND TO HOLD unto Lender and Lender’s successors and assigns, forever,
together with all the improvements now or hereafter erected on the property, and
all easements, rights, appurtenances, rents, royalties, mineral, oil and gas
rights and profits, water, water rights, and water stock, and all fixtures now
or hereafter attached to the property, all of which, including replacements and
additions thereto, shall be deemed to be and remain a part of the property
covered by this Mortgage; and all of the foregoing, together with said property
are herein referred to as the “Property”.

Borrower(s) covenants that Borrower(s) is/are lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant and convey the Property,
that the Property is unencumbered, and that Borrower will warrant and defend
generally the title to the Property against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions
to coverage in any title insurance policy insuring Lender’s interest in the
Property.

Borrower(s) and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower(s)
shall promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by this Mortgage.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower(s), Borrower(s) shall pay to Lender on the
day when monthly installments of principal and interest are payable under the
Note, until the Note is paid in full, a sum (herein “Funds”) equal to
one-twelfth of Borrower’s share of the yearly taxes and assessments relating to
the subject Property encumbered by this Mortgage and one-twelfth of the annual
Club Dues and assessments due under the Declaration, (herein “Condominium
Assessments”), or such other amounts or for such other periods other than
monthly, e.g., quarterly or one-fourth, etc., all as reasonably estimated
initially and from time to time by Lender on the basis of assessments and bills
and reasonable estimates thereof.

If Lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, and Condominium
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower(s) interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower(s) any interest on earnings on the Funds.
Lender shall give to Borrower(s), without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes for which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Mortgage.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Condominium Assessments shall exceed the amount required to pay such taxes,
assessments, and Condominium Assessments as they fall due, such excess shall be,
at Borrower’s option, either promptly repaid to Borrower(s) or credited to
Borrower(s) on monthly installments of Funds. If the amount of the Funds held by
Lender shall not be sufficient to pay taxes, assessments, and Condominium
Assessments as they fall due, Borrower(s) shall pay to Lender any amount
necessary to make up the deficiency within thirty (30) days from the date of a
notice mailed by Lender to Borrower(s) requesting payment thereof, but in no
event shall Lender require payment in advance for taxes and assessments to be
held and disbursed as set forth hereunder in an amount which exceeds the
estimate of the next year’s amount for same.

Upon payment in full of all sums secured by this Mortgage, Lender shall promptly
refund to Borrower(s) any Funds held by Lender. If, under Paragraph 18 hereof,
the Property is sold or the Property is otherwise acquired by Lender, Lender
shall apply, no later than immediately prior to the sale of the Property or its
acquisition by Lender, any Funds then held by Lender as a credit against the
sums secured by this Mortgage.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and Paragraphs 1 and 2 hereof shall
be applied by Lender first in payment of amounts payable to Lender by
Borrower(s) under Paragraph 2 hereof, if any, then against advances, if any,
made by Lender pursuant to Paragraph 7 of this Mortgage, then to costs, fees,
expenses, and other amounts incurred and advanced by the Lender in the
enforcements of its rights under the note and this Mortgage, including, without
limitation, costs and reasonable attorneys’ fees, then to unpaid service fees,
then to interest payable on the Note, then to the principal on the Note, then to
unpaid late charges, if any, then to interest on any Future Advances made at
Lender’s option pursuant to Paragraph 20 hereof, then to the principal on Future
Advances, if any, made at Lender’s option pursuant to Paragraph 20 hereof.

 

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4. Charges; Liens. Borrower(s) shall promptly pay, when due, all Condominium
Assessments imposed by Eagle Tree Condominium Association, Inc., or other
governing body of Eagle Tree Condominium (the “Condominium Association”) or
Eagle Tree Property Owners’ Association, Inc., pursuant to the provisions of the
Declaration, by-laws, rules and regulations or other constituent documents of
Eagle Tree Condominium, as well as the Master Declaration of Covenants,
Conditions, Easements and Restrictions, bylaws, rules and regulations or other
constituent documents of the Eagle Tree Property Owners’ Association, Inc.

Borrower(s) shall pay all taxes, assessments and other charges, fines and
impositions attributable to the Property which may attain a priority over this
Mortgage, in the manner provided under Paragraph 2 hereof or, if not paid in
such manner, by Borrower(s) making payment, when due, directly to the payee
thereof. Borrower(s) shall promptly furnish to Lender all notices of amounts due
under this Paragraph, and in the event Borrower(s) shall make payment directly,
Borrower(s) shall promptly furnish to Lender receipts evidencing such payments.
Borrower(s) shall promptly discharge any lien which has priority over this
Mortgage; provided, that Borrower(s) shall not be required to discharge any such
lien so long as Borrower(s) shall agree in writing to the payment of the
obligation secured by such lien in a manner acceptable to Lender and, if
requested by Lender, immediately post with Lender an amount necessary to satisfy
said obligation, or shall in good faith contest such lien by, or defend
enforcement of such lien in, legal proceedings which operate to prevent the
enforcement of the lien or forfeiture of the Property or any part thereof and,
if requested by Lender, immediately post with Lender an amount necessary to
satisfy said obligation.

5. Hazard Insurance. Borrower(s) shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Mortgage. This
obligation shall be deemed satisfied so long as the Condominium Association
maintains a “master” or “blanket” policy in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower(s) or
the Condominium Association subject to approval by Lender; provided, that such
approval shall not be unreasonably withheld. If required, all premiums on
insurance policies shall be paid in the manner provided under Paragraph 2
hereof, or, if not paid in such manner, by Borrower(s) or the Condominium
Association making payment, when due, directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower(s) shall give Lender prompt notice of any lapse
in hazard insurance coverage. In the event of loss, Borrower(s) shall give
prompt notice to the insurance carrier and Lender. Lender may make proof of loss
if not made promptly by Borrower(s).

Pursuant to the terms of the Declaration, insurance proceeds shall be applied to
restoration or repair of the Property damaged, whether the unit or the common
elements. To the extent such insurance proceeds exceed the cost of such
restoration or repair and the Board of Directors of the Condominium Association
decides to disburse such excess, Borrower’s share of such excess shall be
applied to the sums secured by this Mortgage, with the excess, if any, paid to
Borrower(s).

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not exceed or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments. If under Paragraph 18 hereof the Property is
acquired by Lender, all right, title and interest of Borrower(s) in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to Lender to
the extent of the sums secured by this Mortgage immediately prior to such sale
or acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower(s) shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower(s) shall perform all of Borrower’s
obligations under the Declaration, the by-laws and regulations of the
Condominium Association, and constituent documents. Borrower(s) shall take such
actions as may be reasonable to insure that the Condominium Association
maintains a public liability insurance policy acceptable in form, amount, and
extent of coverage to Lender. If a Condominium rider is executed by Borrower and
recorded together with the Mortgage, the covenants and agreements of such rider
shall be incorporated into and amend and supplement the covenants and agreements
of this Mortgage as if the rider were a part hereof.

7. Protection of Lender’s Security. If Borrower(s) fail(s) to perform the
covenants and agreements contained in this Mortgage, or if any action or
proceeding is commenced which materially affects Lender’s interest in the
Property, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankrupt or decedent,
then Lender at Lender’s option, upon notice to Borrower(s), may make such
appearances, disburse such sums and take such action as is necessary to protect
Lender’s interest, including, but not limited to, disbursement of funds to pay
reasonable attorneys’ fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this Paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower(s) secured by this
Mortgage. Unless Borrower(s) and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower(s) requesting
payment thereof, and shall bear interest from the date of disbursement at the
rate payable from time to time on outstanding principal under the Note unless
payment of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this Paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Property, provided that Lender shall give Borrower(s) notice
prior to any such inspection specifying reasonable cause therefor related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower(s) in connection with any condemnation or
other taking of all or any part of the Property, whether of the unit or the
common elements or for any conveyance in lieu of condemnation, pursuant to the
terms of the Declaration, are hereby assigned and shall be paid to Lender as
provided hereunder.

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments.

10. Borrower(s) Not Released. Extension of the time for payment or modification
of amortization of the sums secured by this Mortgage granted by Lender to any
successor in interest of Borrower(s) shall not operate to release, in any
manner, the liability of the original Borrower(s) and Borrower’s successors in
interest. Lender shall not be required to commence proceedings against such
successor or refuse to extend time for payment or otherwise modify amortization
of the sums secured by this Mortgage by reason of any demand made by the
original Borrower(s) and Borrower’s successors in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Mortgage.

12. Remedies Cumulative. All remedies provided in this Mortgage are distinct and
cumulative to any other right or remedy under this Mortgage or afforded by law
or equity, and may be exercised concurrently, independently or successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of Paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower(s). All covenants and
agreements of Borrower(s) shall be joint and several. The captions and headings
of the paragraphs of this Mortgage are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower(s) provided for in this Mortgage
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower(s) at the Borrower’s address as set forth in the Note, or at such
other address as Borrower(s) may

 

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designate by notice to Lender as provided herein, and (b) any notice to Lender
shall be given by certified mail, return receipt requested, to Lender’s address
stated herein or to such other address as Lender may designate by notice to
Borrower(s) as provided herein. Any notice provided for in this Mortgage shall
be deemed to have been given to Borrower(s) or Lender when given in the manner
designated herein. In the event of a judicial action to enforce this Mortgage,
Borrower hereby agrees that any notice required or service of process made
incident thereto shall be sufficient if made to the above address or to the
registered agent appointed for such purposes by Borrower pursuant to
Section 721.84 Florida Statutes. Borrower may change such address by giving
Lender notice of a change of address in writing to Lender’s address stated
herein.

15. Governing Law; Severability. This Mortgage shall be governed by the laws of
the state where the Property is located. In the event that any provision or
clause of this Mortgage or the Note conflicts with applicable law, such conflict
shall not affect other provisions of this Mortgage or the Note which can be
given effect without the conflicting provision, and to this end the provisions
of the Mortgage and the Note are declared to be severable.

16. Borrower’s Copy. Borrower(s) shall be furnished a copy of the Note and of
this Mortgage at the time of execution or after recordation hereof.

17. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold (or leased with an option to purchase) or
transferred by Borrower(s) without Lender’s prior written consent, excluding
(a) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, (b) the grant of any leasehold interest of three (3) years or less
not containing an option to purchase, or (c) the creation of a lien or
encumbrance subordinate to this Mortgage, Lender may, at Lender’s option,
declare all the sums secured by this Mortgage to be immediately due and payable.
Lender shall have waived such option to accelerate if, and only if, prior to the
sale or transfer, Lender and the person to whom the Property is to be sold or
transferred reach agreement in writing that the credit of such person is
satisfactory to Lender and that the interest payable on the sums secured by this
Mortgage shall be at such rate as Lender shall request, and the assumption fee
set by Lender has been paid. If Lender has waived the option to accelerate
provided in this Paragraph 17, and if Borrower’s successor in interest has
executed a written assumption agreement accepted in writing by Lender, Lender
shall release Borrower(s) from all obligations under this Mortgage and the Note.
Assumption of Borrower’s Mortgage and Note shall be permitted only with written
approval of and at the sole discretion of Lender.

If Lender exercises such option to accelerate, Lender shall mail Borrower(s)
notice of acceleration in accordance with Paragraph 14 hereof. Such notice shall
provide a period of not less than fifteen (15) days from the date the notice is
mailed within which Borrower(s) may pay the sums declared due. If Borrower(s)
fails to pay such sums prior to the expiration of such period, Lender may,
without further notice or demand on Borrower(s), invoke any remedies permitted
by Paragraph 18 hereof.

18. Acceleration; Remedies. Except as provided in Paragraph 17 hereof, upon
Borrower’s breach of any covenant or agreement of Borrower(s) in this Mortgage,
including the covenants to pay when due any sums secured by this Mortgage,
Lender prior to acceleration shall mail notice to Borrower(s) as provided in
Paragraph 14 hereof specifying: (1) the breach; (2) the action required to cure
such breach; (3) a date, not less than fifteen (15) days from the date the
notice is mailed to Borrower(s), by which such breach must be cured; and
(4) that failure to cure such breach on or before the date specified in the
notice may result in acceleration of the sums secured by this Mortgage,
foreclosure by judicial proceedings or other proceedings consistent with the
law, and sale of Property. If Borrower fails to cure any such breach on or
before the date specified in the notice, Lender at Lender’s option, subject to
any right of reinstatement to which Borrower(s) is entitled under applicable
law, may declare, without further demand, all of the sums secured by this
Mortgage to be immediately due and payable and the lien against the Property
created by this Mortgage may be foreclosed in accordance with either a judicial
foreclosure procedure or a trustee foreclosure procedure and may result in the
loss of the Property. If Lender initiates a trustee foreclosure procedure,
Borrower shall have the option to object and Lender may proceed only by filing a
judicial foreclosure action. Lender shall be entitled to collect in such
proceedings all expenses of foreclosure, including, but not limited to,
reasonable attorneys’ fees, court costs, and costs of documentary evidence,
abstracts and title reports.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower(s) hereby assigns to Lender the rents of the Property,
provided that Borrower(s) shall, prior to acceleration under Paragraph 18 hereof
or abandonment of the Property, have the right to collect and retain such rents
as they become due and payable.

Upon acceleration of the Note or abandonment of the Property, Lender shall be
entitled, without notice, to enter upon, take possession of and manage the
Property and to collect the rents of the Property, including those past due. All
rents collected shall be appointed first to payment of the costs of management
of the Property and collection of rents, including, but not limited to,
management fees, court costs, and reasonable attorneys’ fees, and then to the
sums secured by this Mortgage. The Lender shall be liable to account only for
those rents actually received. Borrower(s) shall not be entitled to possession
or use of the Property after abandonment or after the Lender has accelerated the
balance due under the Note. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Property. If a receiver is
appointed, any income from rents from the Property shall be applied first to the
costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower(s), Lender, at Lender’s option,
may make Future Advances to Borrower(s). Such Future Advances, with interest
thereon, shall be secured by this Mortgage whether or not evidenced by
promissory notes stating that said notes are secured hereby. At no time shall
the principal amount of the indebtedness secured by this Mortgage, not including
sums advanced in accordance herewith to protect the security of this Mortgage,
exceed one hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower(s) shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to:

(i) The abandonment or termination of Eagle Tree Condominium, except for
abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain;

(ii) any amendment to any provision of the Declaration, By-Laws or Rules and
Regulations of the Condominium Association, or equivalent constituent documents
of Eagle Tree Condominium which is for the express benefit of Lender; or

(iii) any action which would have the effect of rendering the public liability
insurance coverage maintained by the Condominium Association unacceptable to
Lender.

22. Attorneys’ Fees. As used in this Mortgage and in the Note, “attorneys’ fees”
shall include attorneys’ fees, if any, and related costs incurred by Lender in
the enforcement of its rights under the Note and/or Mortgage, whether or not
legal action is instituted, and any fees and costs of trial and appellate
proceedings.

23. Venue and Jurisdiction. Borrower hereby consents to the enforcement of the
Note and Mortgage in Palm Beach County, Florida and hereby submits to the
jurisdiction of the courts of the state of Florida for such purpose.

 

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IN WITNESS WHEREOF, Borrower(s) has/have executed this Mortgage on the day and
year first written above. Signed in the presence of:

 

Witness     Mortgagor           Witness     Mortgagor           Witness    
Mortgagor           Witness     Mortgagor     STATE OF
                                         )           ACKNOWLEDGMENT            
COUNTY OF                                              )      

This Mortgage was acknowledged before me this
                                                              by
                                             ,

                                                     ,
                             and                                         ,
(i) who is (are) personally known to me or (ii) has (have) produced
                                              [list type of identification] as
identification.

 

(Print Name:                                                                  

NOTARY PUBLIC

My Commission Expires:

Commission No:

(ADDITIONAL ACKNOWLEDGMENT, IF MORTGAGORS SIGN BEFORE DIFFERENT NOTARIES)

 

STATE OF                                                              )    
ACKNOWLEDGMENT COUNTY OF                                        
                            )      

This Mortgage was acknowledged before me this
                                                     by
                                                             ,
                                                 ,
                                              and
                                             , (i) who is (are) personally known
to me or (ii) has (have) produced                                          
                    [list type of identification] as identification.

 

(Print Name:                                                                  

NOTARY PUBLIC

My Commission Expires:

Commission No:

Prepared by and return to: Attn: New Owner Administration- 1200 Bartow Road,
Suite 10, Lakeland, Florida 33801

 

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HAWAII SAMPLE (RCDC)

NOTE

 

Mortgage No.:                                                            
Vacation Ownership (Club) Interest No(s).
                                         Recorded:
                                                                   Preparation
Date:                                          
                                        US
$                                                                           
Closing Date:                                          
                                              

1. DEFINED TERMS. Certain words used in this document have special meanings as
set forth below:

(a) “NOTE” - This document in which you promise to pay the Debt. You are giving
it to THE RITZ-CARLTON DEVELOPMENT COMPANY, INC. to pay for the Property
described in the Mortgage. The Debt and this Note are secured by the Mortgage.

(b) “DEBT” - Both the Principal and Interest charged on that portion of
Principal that is not then paid. “Principal” means the amount of
                     (US $            ). “Interest” is simple interest, which
means that it is charged (accrues) only on that part of the Principal which is
not then paid. It is not on a block or other basis where the dollar amount of
interest is fixed in advance. In this Note, the rate, but not the dollar amount,
of Interest is fixed. This rate is                      percent
(            %) per year based on a 360-day year, collected for the actual
number of days principal is outstanding in any calendar year. Loan payments are
to be made in installments calculated to repay the loan in full over the term of
the loan and is based on the assumption that all payments are made when due.
Interest will be charged on that part of the Principal, which has not been paid.
Interest at this rate will start on the          day of                     ,
            , and will continue until the full amount of the Principal has been
paid.

(c) “MORTGAGE” - The document entitled “Mortgage, Security Agreement and
Financing Statement with Power of Sale” which you have signed. It gives property
to the Holder as security to protect the Holder from possible losses that might
result if you do not keep the promises you make in this Note and in the
Mortgage.

(d) “YOU” - Each person who signs this Note. If more than one person signs, each
of you is fully and personally obligated to pay the full amount of the Debt and
to keep all of the other promises made in this Note. For example, the fact that
one or more of you does not pay a part of the Debt does not excuse the rest of
you from paying all of the Debt and keeping all of the other promises. The
Holder may therefore enforce its rights under this Note against each of you
individually or against some or all of you together. In legal terms, each of you
is “jointly and severally liable.”

(e) “RITZ-CARLTON” - THE RITZ-CARLTON DEVELOPMENT COMPANY, INC., a Delaware
corporation. Its address is 6649 Westwood Boulevard, 3rd Floor, Orlando, Florida
32821-6090.

(f) “HOLDER” - Ritz-Carlton or anyone who takes this Note later by transfer and
who is entitled to receive the payments you promise to make in this Note. You
understand that any Holder may transfer this Note to someone else.

(g) “CLOSING DATE” - The date indicated above.

2. YOUR PROMISE TO PAY. You promise to pay the Debt, both Principal and
Interest, plus all other sums you owe under this Note and under the Mortgage, to
the order of Marriott or any other Holder.

3. HOW, WHEN, AND WHERE YOU PROMISE TO PAY. You promise to pay the Debt, both
Principal and Interest, by making payments every month. Each monthly payment
will be in the amount of

 

1

387598.5 RA (11.10.09)

IM #449199.3

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                     UNITED STATES DOLLARS ($            ), and must be made on
the          day of each month, starting on                     . A service fee
of $5.00 must accompany each monthly payment. You promise to make these payments
every month until you have paid all of the Debt. If, however, on
                    , you still owe anything under this Note, you promise to pay
the Debt in full on that date. You promise to make your payments to Ritz-Carlton
at P. O. Box 382028, Pittsburgh, PA 15250-8028, or at any other place the Holder
tells you in writing to pay.

4. HOW YOUR PAYMENTS WILL BE APPLIED. In addition to Principal and Interest, you
may be required to make other payments as stated in this Note or in the
Mortgage. For example, you may be required to make other payments, such as late
charge payments, if you do not keep the promises made in this Note or in the
Mortgage (in other words, if you “default”). Further, you must also make
payments to cover service fees and returned check charges, if any. The Mortgage
states the manner in which your payments will be applied to these fees and
charges, to Interest and to Principal.

5. YOUR RIGHT TO PAY EARLIER (“PREPAYMENT”). The Mortgage states the manner and
the conditions under which you may pay the Debt before the time you promise to
do so in this Note.

6. THE HOLDER MAY REQUIRE YOU TO PAY EARLIER IF YOU BREAK YOUR PROMISES
(“ACCELERATION”). You agree that the Mortgage states the manner and the
conditions under which the Holder may require you to make immediate payment of
the Debt in full, if you default. Thus, as stated in the Mortgage, if you
default, you may lose your right to pay the Debt in monthly payments.

7. OTHER CHARGES AND COSTS YOU PROMISE TO PAY IF YOU DEFAULT.

(a) LATE CHARGES. If the Holder has not received the full amount of any monthly
payment by the end of ten (10) calendar days after the date it is due, you
promise to pay a late charge to the Holder with the next monthly payment. Each
late charge will be six percent (6%) of the late monthly payment or $25.00,
whichever is less.

(b) THE HOLDER’S COSTS AND ATTORNEY’S FEES. If you default, you promise to pay
the Holder all of the reasonable costs the Holder incurs in trying to make you
keep the promises you make in this Note and in the Mortgage. These costs
include, for example, the Holder’s reasonable attorney’s fees and costs, whether
or not the Holder sues you. You promise to pay all of these costs at once after
the Holder demands payment from you.

8. THIS NOTE IS SECURED BY THE MORTGAGE. You agree that this Note is secured by
the Mortgage.

9. YOU, AND CERTAIN OTHER PERSONS, WAIVE CERTAIN RIGHTS. You waive your rights
to require the Holder to do certain things. They are: (a) to demand payment of
amounts due (known as “presentment”); (b) to give notice that amounts due have
not been paid (known as “notice of dishonor”); and (c) to obtain an official
certification of nonpayment (known as a “protest”). Anyone else who agrees to
keep the promises made in this Note, who agrees to make payments to the Holder
if you fail to keep your promises under this Note or who signs this Note to
transfer it to someone else, also waives these rights. (These persons are known
as “guarantors, sureties and endorsers”.)

You and each guarantor, surety and endorser consent to any extension of the time
by which the payment of this Note or any monthly payments must be made and to
any other change to the terms of this Note (this includes the release of any
person liable on this Note). These extensions or changes can be made without
notice to you or any of them, and will not release or affect your liability or
the liability of any of these other persons on this Note.

10. GOVERNING LAW. Hawaii law governs this Note.

11. CAPTIONS. Ritz-Carlton has tried to appropriately divide and caption this
Note by its various paragraphs. Captions are a part of this Note, but obviously
cannot and do not completely or adequately explain each

 

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paragraph or the entire agreement. Ritz-Carlton recommends that you read with
care each and every paragraph of this Note and not just the captions alone. No
court may treat the captions and headings as if they explain what the paragraph
means.

12. HOW ANY COURT SHOULD READ THIS NOTE. This Note was written in plain language
so that it would be easier to read and understand. It uses words which are less
accurate than the words which most courts are used to seeing. It also does not
include the long overlapping phrases used to prevent courts from reading words
too narrowly. If any court is ever asked to interpret this Note, Ritz-Carlton
and you ask that it keep those facts in mind and interpret this Note as common
sense would require in order to do what Ritz-Carlton and you clearly wanted this
Note to do.

By signing this document, you agree to everything that is said in this Note.

YOU HAVE THE OPTION TO CANCEL THIS AGREEMENT BY NOTICE TO RITZ-CARLTON UNTIL
MIDNIGHT OF THE SEVENTH (7TH) DAY FOLLOWING THE SIGNING OF THIS NOTE.

IF YOU DID NOT RECEIVE A PROPERTY REPORT PREPARED PURSUANT TO THE RULES AND
REGULATIONS OF THE OFFICE OF INTERSTATE LAND SALES REGISTRATION, U.S. DEPARTMENT
OF HOUSING AND URBAN DEVELOPMENT, IN ADVANCE OF YOUR SIGNING THIS NOTE, THIS
NOTE MAY BE CANCELED AT YOUR OPTION FOR TWO (2) YEARS FROM THE DATE OF SIGNING.

 

Your Address:         

 

“You” Print Your Name “You” Print Your Name “You” Print Your Name

 

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HAWAII SAMPLE (RCDC)

 

LAND COURT SYSTEM

   REGULAR SYSTEM

AFTER RECORDATION: RETURN BY MAIL (            ) PICK UP (            )

 

Tax Map Key No. (2) 4-2-04: 028 and 029

   Total Pages:             

MORTGAGE, SECURITY AGREEMENT AND FINANCING

STATEMENT WITH POWER OF SALE

Vacation Ownership (Club) Interest No(s):

 

LENDER(S) NAME:

   THE RITZ-CARLTON DEVELOPMENT COMPANY, INC., a Delaware corporation 6649
Westwood Boulevard, 3rd Floor, Orlando, Florida 32821-6090

BORROWER(S) NAME AND ADDRESS:

DEFINED TERMS. Certain words used in this document have special meanings which
are set forth below. Other words which begin with a capital letter will have the
meaning given to such word in The Kapalua Bay Vacation Ownership Project
Declaration of Covenants, Conditions and Restrictions that was recorded at the
Bureau of Conveyances of the State of Hawaii as Document No. 2006-112198, as
amended (the “Declaration”).

A. “MORTGAGE” - This document which is dated                     ,             
will be called the “Mortgage.” It gives the Property to the Holder as security
to protect the Holder from possible losses that might result if you do not keep
the promises you make in the Note and in this Mortgage. You are giving it to
Ritz-Carlton as security for your promise to repay the funds used to pay for the
Property with interest.

B. “YOU” OR THE “BORROWER”                             , and
                             whose address is                     , is the
person or are the persons signing the Note and this Mortgage, and will sometimes
be called “Borrower” and sometimes simply “You.”

C. “RITZ-CARLTON” - THE RITZ-CARLTON DEVELOPMENT COMPANY, INC. will be called
“Ritz-Carlton.” It is a corporation organized and existing under the laws of the
State of Delaware, with its principal place of business and post office address
at 6649 Westwood Boulevard, 3rd Floor, Orlando, Florida 32821-6090.

 

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D. “HOLDER” - Ritz-Carlton or anyone who takes this Mortgage and the Note later
by transfer and who is entitled to receive the payments you promise to make in
the Note and to enforce the promises you make in this Mortgage. You understand
that any Holder may transfer the Note and this Mortgage to someone else.

E. “NOTE” - The Note you are signing. The “Note” also means all changes and
extensions to the Note that you and the Holder agree to. The Note states that
you owe the Holder                      UNITED STATES DOLLARS ($             )
which amount is called the “Principal” plus “Interest”. You promise to pay all
amounts as and when stated in the Note. The Note is secured by this Mortgage.

F. “DEBT” - The amount you owe the Holder, both Principal and simple (not block)
Interest. These amounts will be called the “Debt.”

G. “PROPERTY” - The property that is described below in the section entitled
“Description Of The Property.”

H. “FUTURE ADVANCES” - Any amount loaned to Borrower after the date of this
Mortgage, which, unless otherwise agreed, will accrue interest at the rate set
forth in the Note.

I. BORROWER’S TRANSFER TO HOLDER OF RIGHTS IN THE PROPERTY.

You here and now mortgage, grant and convey the Property to Ritz-Carlton,
subject to the terms of this Mortgage. You give this Mortgage as security for
the payment of the Note and all amounts you may owe under the Note or this
Mortgage, including the Debt, and as security that you will observe and perform
all of the promises and other agreements you make in the Note and Mortgage. This
means that, by signing this Mortgage, you are giving Ritz-Carlton (and any later
Holder) those rights that are stated in this Mortgage and also those rights that
the law gives to creditors who hold mortgages on real property and security
interests in personal property. You are giving the Holder these rights to
protect it from possible losses that might result if you fail to:

A. Pay all the Debt, both Principal and Interest, that you owe the Holder as and
when stated in the Note; or

B. Pay all other sums you owe Holder under the Note and under this Mortgage,
including any Future Advances; or

C. Pay, with interest, any amounts that the Holder spends under this Mortgage to
protect the value of the Property and the Holder’s rights in the Property; or

D. Keep all of your other promises and agreements under the Note and this
Mortgage; or

E. Keep all of your promises and agreements under the Purchase Agreement and
under the Buyer’s Acknowledgements pertaining to the Property, which you signed
prior to this Mortgage.

II. DESCRIPTION OF THE PROPERTY.

You give the Holder rights in the Property which is described in subparagraphs
(A) through (F) below:

A. The Club Interest(s) and other property rights described in Exhibit “A”
attached hereto and incorporated herein by this reference;

B. All rights granted to you by Condominium Documents, Club Documents and the
Program Documents;

C. All rights in other property that you have as owner of the Club Interest
described in Paragraph (A) of this section. These rights are known as
“easements, profits and appurtenances attached to the property, including
membership in The Kapalua Club;”

 

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D. All rights that you have in all fixtures that are now or in the future will
be on the property described in Paragraph (A) of this section, and all
replacements of and additions to those fixtures. Usually, fixtures are items
that are physically attached to buildings, such as hot water heaters;

E. All of the rights and property described in Paragraphs (B) and (C) of this
section that you acquire in the future; and

F. All replacements of or additions to the property described in Paragraph
(C) of this section.

III. BORROWER’S RIGHT TO MORTGAGE THE PROPERTY AND BORROWER’S OBLIGATION TO
DEFEND OWNERSHIP OF THE PROPERTY.

You here and now promise that except for the encumbrances listed in Exhibit “A”
to this document: (A) You lawfully own the Property; (B) You have the right to
mortgage, grant and convey the Property to the Holder; and (C) There are no
outstanding claims or charges against the Property.

You here and now give a general warranty of title to the Holder. This means that
you will be fully responsible for any and all losses which the Holder suffers
because someone other than you has some of the rights in the Property which you
promise that you have and are mortgaging to the Holder. You promise that you
will defend your ownership of the Property against any claims of such rights.

IV. YOUR PROMISES.

You promise and you agree with the Holder as follows:

A. BORROWER’S PROMISE TO PAY PRINCIPAL AND INTEREST UNDER THE NOTE AND TO
FULFILL OTHER PAYMENT OBLIGATIONS. You will promptly pay to the Holder when due:
the Debt, both Principal and Interest, under the Note; late charges and other
charges, fees and costs stated in the Note; and all sums due under any part of
this Mortgage.

B. HOLDER’S APPLICATION OF BORROWER’S PAYMENTS. Unless the law requires
otherwise, the Holder will apply each of your payments under the Note and this
Mortgage in the following order and for the following purposes:

1. First, to pay amounts payable by Borrower for taxes, assessments and other
obligations, if any, under Paragraph (C) of this section;

2. Next, to pay, with interest, any amounts that the Holder spends under this
Mortgage to protect the value of the Property and the Holder’s rights in the
Property;

3. Next, to the costs, fees, expenses and other amounts incurred and advanced by
the Holder in the enforcement of its rights hereunder, including without
limitations, costs and reasonable attorneys’ fees;

4. Next, to pay any service fee charged by the Holder;

5. Next, to pay Interest then due under the Note;

6. Next, to pay Principal then due under the Note;

7. Next, to pay late charges and other charges and costs you promise to pay
under the Note or this Mortgage;

8. Next, to pay interest on any Future Advances made pursuant to Paragraph
(X) of this section; and

 

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9. Last, to pay principal on any Future Advances made pursuant to Paragraph
(X) of this section.

C. AGREEMENTS ABOUT REAL PROPERTY TAXES, ASSESSMENTS FOR THE CONDOMINIUM PROJECT
AND CLUB, AND OTHER CHARGES. You promise to pay all real property taxes (which
should be included in the assessment made by the Association), charges from both
the Condominium Association and the Association, and all other charges and fines
of every kind imposed on or in any way related to the Property and its use. It
does not matter who is billed for these charges. For example, even if the Holder
or the Management Company for the Association is billed, you must pay.

Subject to applicable law, upon written request by Holder to Borrower, Borrower
shall pay to Holder on the day when monthly installments of principal and
interest are payable under the Note, until the Note is paid in full, a sum
(herein “Funds”) equal to one-twelfth of Borrower’s share of any taxes and
assessments relating to the subject Property encumbered by this Mortgage and
one-twelfth of the Borrower’s share of the annual maintenance fee or assessment
due to the Association or the Condominium Association, or such other amounts or
for such other periods other than monthly, e.g. quarterly, all as reasonably
estimated initially and from time to time by Holder on the basis of assessments
and bills and reasonable estimates thereof.

If Holder exercises this right, the Funds shall be held in an institution the
deposits or accounts of which are insured or guaranteed by a Federal or state
agency. Holder shall apply the Funds, upon receipt of the appropriate bill or
bills, to pay said taxes and assessments. Holder may not charge for so holding
and applying the Funds, analyzing said account, or verifying and compiling old
assessments and bills, unless Holder pays to Borrower interest on the Funds and
applicable law permits Holder to make such a charge. Unless applicable law
requires, Holder shall not be required to pay Borrower any interest or other
earnings on the Funds. Holder shall give to Borrower, without charge, an annual
accounting of the Funds showing credits and debits to the Funds and the purposes
for which each debit to the Funds was made. The Funds are hereby pledged as
additional security for the sums secured by this Mortgage.

If the amount of the Funds held by Holder, together with the future monthly
installments of Funds payable prior to the due dates of taxes and assessments
shall exceed the amount required to pay such taxes and assessments, as they fall
due, such excess shall be, at Borrower’s option, either promptly repaid to
Borrower or credited to Borrower on monthly installments of Funds. If the amount
of the Funds held by Holder shall not be sufficient to pay taxes and assessments
as they fall due, Borrower shall pay to Holder any amount necessary to make up
the deficiency within thirty (30) days from the date of a notice mailed by
Holder to Borrower requesting payment thereof, but in no event shall Holder
require payment in advance for taxes and assessments to be held and disbursed as
set forth hereunder in an amount which exceeds the estimate of the next year’s
amount for same.

Upon payment in full of all sums secured by this Mortgage, Holder shall promptly
refund to Borrower any funds held by Holder. If the Property is sold or the
Property is otherwise acquired by Holder, Holder shall apply, no later than
immediately prior to the sale of the Property or its acquisition by Holder, any
Funds then held by Holder as a credit against the sums secured by this Mortgage.

Without limiting the general nature of the promise made in the preceding
paragraph of this Paragraph C, you will pay all taxes, assessments, and any
other charges and fines that may now or later be imposed on the Property and
that may be superior to this Mortgage. You will do this either by making the
payments to the Association, or by making payments, when they are due, directly
to the persons entitled to them. (In this Mortgage, the word “person” means any
person, organization, governmental authority, or other party.) If you make
direct payments, then, promptly after making any of those payments, you will
give the Holder a receipt which shows that you have done so. You will promptly
pay, when they are due, all assessments imposed by the Condominium Association
and the Association.

Any claim, demand or charge that is made against the Property because an
obligation has not been fulfilled is known as a lien. You will promptly pay or
satisfy all liens against the Property that may be superior to this Mortgage.
This Mortgage does not, however, require you to satisfy a superior lien if:
(A) You agree, in writing, to pay the obligation which gave rise to the superior
lien and the Holder approves the way in which you agree to pay that obligation;
or (B) You, in good faith, argue or defend against the superior lien in a
lawsuit so that during the lawsuit, the superior lien may not be enforced, and
no part of the Property must be given up.

 

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D. HAZARD INSURANCE. Since the Property consists, in part, of an interest in a
unit in a condominium project, as well as an interest in a vacation ownership
program, the Condominium Association and/or the Association will typically
maintain a hazard insurance policy which covers all buildings and other
improvements that now are or in the future will be located in the project or in
the Unit, covering loss or damage caused by fire, hazards normally covered by
special form insurance policies and other hazards. Such a policy may be referred
to as the “master policy.” So long as the master policy remains in effect and
satisfies the requirements stated in this Paragraph D, you are not required to
obtain and maintain separate hazard insurance on the Property. In the event that
the Condominium Association or the Association does not maintain a master policy
covering the Condominium or property in the Condominium and in the Unit, or such
master policy, in the Holder’s reasonable opinion, is not sufficient to
adequately protect Holder’s security interest in the Property, the Holder shall
have the right to require you to obtain and maintain hazard insurance to cover
the Property in the amounts and for the periods of time required by the Holder.
In the event that the insurance policy you obtain contains provisions, known as
“co-insurance requirements,” that limit the insurance company’s obligation to
pay claims if the amount of coverage is too low, the Holder may require you to
obtain an amount of coverage up to the larger of the following two amounts:
(1) the amount that you owe to the Holder under the Note and under this
Mortgage; or (2) the amount necessary to satisfy the co-insurance requirements.

All insurance which you are required to obtain shall be carried with companies
selected by you, which companies shall be authorized to do business in the State
of Hawaii, and the Holder may require that the policies and renewals thereof be
held by the Holder and have attached thereto loss payable clauses in favor of
and in form acceptable to the Holder. You will pay the premiums on the insurance
policies by paying the insurance company directly when the premium payments are
due. If the Holder requires, you will promptly give the Holder all receipts of
paid premiums and all renewal notices that you receive.

If there is a loss or damage to the Property, you will promptly notify the
Association, the Condominium Association and the Holder, if a master policy is
obtained and maintained for the Condominium and/or the Club, or the insurance
company and the Holder if you are required to obtain the insurance coverage. If
you do not promptly prove to the insurance company that the loss or damage
occurred, then the Holder may do so.

The amount paid by the insurance company is called “proceeds.” The proceeds from
any insurance obtained by the Association, the Condominium Association or you
must be used to repair or to restore the damaged property unless: (a) it is not
economically possible to make the repairs or restoration; or (b) the use of the
proceeds for that purpose would lessen the protection given to the Holder by
this Mortgage; or (c) the Holder and you have agreed in writing not to use the
proceeds for that purpose. If the repair or restoration is not economically
possible or if it would lessen the Holder’s protection under this Mortgage, then
the proceeds applicable to the Property will be used to reduce the amount that
you owe to the Holder under the Note and under this Mortgage. In addition, since
a portion of the Property consists of an interest in a Unit in the Condominium
and Club, it is possible that proceeds under the master policy will be paid to
you instead of being used to repair or to restore the damaged property. You give
the Holder your rights to those proceeds, which will be paid to the Holder, and
will be used to reduce the amount that you owe to the Holder under the Note and
under this Mortgage. If any of the proceeds remain after the amount that you owe
to the Holder has been paid in full, the remaining proceeds will be paid to you.
The use of proceeds to reduce the amount that you owe to the Holder will not be
a prepayment that is subject to the prepayment charge provisions, if any, under
the Note or this Mortgage.

If you abandon the Property, or if you do not answer, within thirty (30) days, a
notice from the Holder stating that the insurance company has offered to settle
a claim for insurance benefits, then the Holder has the authority to collect the
proceeds. The Holder may then use the proceeds to repair or restore the damaged
property or to reduce the amount that you owe to the Holder under the Note and
under this Mortgage. The thirty (30) day period will begin on the date the
notice is mailed or, if it is not mailed, on the date the notice is delivered.

If any proceeds are used to reduce the amount of Principal which you owe to the
Holder under the Note, that use will not delay the due date or change the amount
of any of your monthly payments under the Note and under Paragraph A of this
Section V. You and the Holder may, however, agree in writing to those delays or
changes.

If the Holder acquires the Property under Paragraph P of this Section V, all of
your rights in the insurance policies will belong to the Holder. Also, all of
your rights in any proceeds which are paid because of damage that

 

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occurred before the Property is acquired by the Holder or sold will belong to
the Holder. The Holder’s rights in those proceeds will not, however, be greater
than the amount that you owe to the Holder under the Note and under this
Mortgage immediately before the Property is acquired by the Holder or sold.

If there is a conflict concerning the use of proceeds between the terms of this
Paragraph D and the law or the terms of the Condominium Documents and/or the
Program Documents, then that law or the terms of those documents will govern the
use of proceeds. You will promptly give the Holder notice if the master policy
or the insurance policy you obtain is interrupted or terminated.

E. BORROWER’S OBLIGATION TO MAINTAIN THE PROPERTY, AND AGREEMENTS ABOUT THE
CONDOMINIUM AND THE CLUB.

1. AGREEMENTS ABOUT MAINTAINING THE PROPERTY. You will keep your assigned Unit
in good repair during the time you occupy that Unit. You will not destroy,
damage or substantially change the Assigned Unit. Without limiting the general
nature of your obligations, you promise not to store in or use on the
Condominium any hazardous materials, drugs or other contraband, or to permit any
person you allow to use your Club Interest to do so.

2. AGREEMENTS THAT APPLY TO THE CONDOMINIUM PROJECT AND CLUB. Since the Property
is an interest in a Unit in the Condominium and the Club, you will fulfill all
of your obligations under the Condominium Documents, Program Documents and Club
Documents. Also, you will not divide the Property into smaller parts that may be
owned separately (known as “partition”). You will not consent to certain actions
unless you have first given the Holder notice, and obtained the Holder’s consent
in writing. Those actions are:

a. The abandonment or termination of the Condominium or the Club unless the
abandonment or termination is required by law;

b. Any significant change to the Condominium Documents or Club Documents,
including, for example, a change in the percentage of ownership rights held by
apartment owners in the Condominium or a change in the percentage of ownership
rights held by vacation ownership owners in Units in the Club; or

c. A decision by the Condominium Association or the Association to terminate
professional management and to begin self-management of the Condominium or the
Club.

You promise that you will do everything in your power so that the Condominium
Association and the Association will each comply fully with the documents
creating and governing the Condominium and the Club, respectively.

F. HOLDER’S RIGHT TO TAKE ACTION TO PROTECT THE PROPERTY If: (1) You do not keep
your promises and agreements made in this Mortgage, or (2) someone, including
you, begins a legal proceeding that may significantly affect the Holder’s rights
in the Property (such as, for example, a legal proceeding in bankruptcy, in
probate, for condemnation, or to enforce laws or regulations), then the Holder
may do and pay for whatever is necessary to protect the value of the Property
and the Holder’s rights in the Property. The Holder’s actions under this
Paragraph F may include, for example, appearing in court, and paying reasonable
attorney’s fees and court costs. The Holder must give you notice before the
Holder may take any of these actions.

You will pay to the Holder any amounts, with interest, which the Holder spends
under this Paragraph F. This Mortgage will protect the Holder in case you do not
keep this promise to pay those amounts, with interest.

You will pay those amounts to the Holder when the Holder sends you a notice
requesting that you do so. You will also pay interest on those amounts at the
same rate stated in the Note. If, however, payment of interest at that rate
would violate the law, you will pay interest on the amounts spent by the Holder
under this Paragraph F at the highest rate that the law allows. Interest on each
amount will begin on the date that the amount is spent by the Holder. The Holder
and you may, however, agree in writing to terms of payment that are different
from those in this Paragraph F.

Although the Holder may take action under this Paragraph F, the Holder is not
required to do so.

 

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G. HOLDER’S RIGHT TO INSPECT THE CONDOMINIUM. The Holder, and others authorized
by the Holder, may enter on and inspect the Condominium. They must do so in a
reasonable manner and at reasonable times. You agree to take such action as may
be required for Holder to conduct such an inspection. Before any one of those
inspections is made, the Holder must give you notice stating a reasonable
purpose for the inspection. That purpose must be related to the Holder’s rights
in the Property.

H. AGREEMENTS ABOUT CONDEMNATION OF THE PROPERTY. A taking of property by any
governmental authority by eminent domain is known as “condemnation.” Subject to
provisions in the documents that create and govern the Condominium and the Club,
you and the Holder make the following agreements about condemnation of the
Property:

You give to the Holder your right to the proceeds of all awards or claims for
damages resulting from condemnation or other governmental taking of the Property
(or a portion thereof) and to the proceeds from a sale of the Property (or a
portion thereof) that is made to avoid condemnation. All of those proceeds will
be paid to the Holder.

If all of the Property is taken, the proceeds will be used to reduce the amount
that you owe to the Holder under the Note and under this Mortgage. If any of the
proceeds remain after the amount that you owe to the Holder has been paid in
full, the remaining proceeds will be paid to you. Unless the Holder and you
agree otherwise in writing, if only a part of the Property is taken, the amount
that you owe to the Holder will only be reduced by the amount of proceeds
multiplied by the following amount: (1) the total amount that you owe to the
Holder under the Note and under this Mortgage immediately before the taking,
divided by (2) the fair market value of the Property immediately before the
taking. The remainder of the proceeds will be paid to you. The use of proceeds
to reduce the amount that you owe to the Holder will not be a prepayment that is
subject to the prepayment charge provisions, if any, under the Note or this
Mortgage.

If you abandon the Property, or if you do not answer within thirty (30) days, a
notice from the Holder stating that a governmental authority has offered to make
a payment or to settle a claim for damages, then the Holder has the authority to
collect the proceeds. The Holder may then use the proceeds to repair or restore
the damaged property or to reduce the amount that you owe to the Holder under
the Note and under this Mortgage. The thirty (30) day period will begin on the
date the notice is mailed or, if it is not mailed, on the date the notice is
delivered.

If any proceeds are used to reduce the amount of principal which you owe to the
Holder under the Note, that use will not delay the due date or change the amount
of any of your monthly payments under the Note. The Holder and you may, however,
agree in writing to those delays or changes.

I. CONTINUATION OF HOLDER’S RIGHTS. Even if the Holder does not exercise or
enforce any right of the Holder under this Mortgage or under the law, the Holder
will still have all of those rights and may exercise and enforce them in the
future. Even if the Holder obtains insurance, pays taxes or pays other claims,
charges or liens against the Property, the Holder will still have the right,
under Paragraph P of this Section V, to demand that you make Immediate Payment
In Full (see Paragraph P of this Section V for a definition of this phrase) of
the amount that you owe to the Holder under the Note and under this Mortgage.

J. HOLDER’S ABILITY TO ENFORCE MORE THAN ONE OF HOLDER’S RIGHTS. Each of the
Holder’s rights under this Mortgage is separate. The Holder may exercise and
enforce one or more of those rights, as well as any of the Holder’s other rights
under the law, one at a time or some or all at once.

K. JOINT AND SEVERAL LIABILITY; AGREEMENTS CONCERNING CAPTIONS. If more than one
person signs this Mortgage as Borrower, each of you is fully obligated to keep
all of Borrower’s promises and obligations contained in this Mortgage. The
Holder may enforce the Holder’s rights under this Mortgage against each of you
individually or against some or all of you together. This means that any one of
you may be required to pay all of the amounts owed under the Note and under this
Mortgage. The captions and titles of this Mortgage are for convenience only.
They may not be used to interpret or to define the terms of this Mortgage.

L. AGREEMENTS ABOUT GIVING NOTICES REQUIRED UNDER THIS MORTGAGE. Unless the law
or this Mortgage requires otherwise, any notice that must be given to you under
this Mortgage will be given by delivering

 

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or telecopying it to you or by mailing it addressed to you at the address for
giving notices stated in Paragraph B of Section I above entitled “Defined
Terms.” The Holder does not have to send the notice to every Borrower at each of
the Borrower’s addresses, if there is more than one Borrower. A notice will be
delivered at a different address if you give the Holder a notice of your
different address for notices in writing. Any notice that must be given to the
Holder under this Mortgage will be given by mailing it to the Holder’s address
stated in Paragraph C of Section I above entitled “Defined Terms.” A notice will
be mailed to the Holder at a different address if the Holder gives you a notice
of the different address. A notice required by this Mortgage is given (and will
be deemed to be received) when it is mailed or when it is delivered or
telecopied according to the requirements of this Paragraph L.

M. AGREEMENTS ABOUT LAWSUITS AND THE LAW THAT GOVERNS THE NOTE AND THIS
MORTGAGE.

1. The law that will govern the Note and this Mortgage is the law of the State
in which the Property is located. This governing law is the law of the State of
Hawaii, which will control except to the extent that federal law may apply. If
any term of this Mortgage or of the Note conflicts with the law, all other terms
of this Mortgage and of the Note will still remain in effect if they can be
given effect without the conflicting term. This means that any terms of this
Mortgage and of the Note which conflict with the law can be separated from the
remaining terms, and the remaining terms will still be enforced.

2. To the extent permitted by applicable law, any lawsuit or other proceeding
involving the Note or this Mortgage must be filed only in Courts of the State of
Hawaii or the United States Federal District Court for the District of Hawaii.
Neither you nor the Holder is allowed to do anything to defeat the power and
right (called “jurisdiction” and “venue”) of these courts to handle any such
lawsuit or other proceeding, since it is intended that any such lawsuit or
proceeding be resolved in Hawaii where the Property is located, and because the
Note and this Mortgage are subject to Hawaii law. Even if you are not a citizen
or resident of the State of Hawaii, you submit yourself to the jurisdiction and
venue of such courts for all purposes involving the Note and this Mortgage. All
rights you have to a jury trial in any such lawsuit or proceeding you here and
now “waive.” It is intended that any disputes be submitted to a judge for
resolution.

N. BORROWER’S COPY OF THE NOTE AND OF THIS MORTGAGE. You will be given a copy of
the Note and of this Mortgage showing that these documents have been signed. You
will be given those copies either when you sign the Note and this Mortgage or
after this Mortgage has been officially recorded in the proper official records.
If you do not receive these copies you may insist that Ritz-Carlton give them to
you, but you still must keep all of the promises that you make in these
documents.

O. PROHIBITION ON ASSUMPTION OF THIS MORTGAGE AND HOLDER’S RIGHTS IF BORROWER
TRANSFERS THE PROPERTY. This Mortgage and the Note may not be transferred by you
to anyone else. The Holder expects you to pay all amounts due and to keep all of
the promises stated in these documents. It would not have extended credit to you
if it realized that you would have someone else assume your obligations. Thus,
if you sell or transfer the Property, unless indicated otherwise below, the
Holder will have the right to require Immediate Payment In Full (this term is
explained in Paragraph P below). The Holder will not have the right to require
Immediate Payment In Full, however, as a result of certain transfers. Those
transfers are:

1. The creation of liens or other claims against the Property that are inferior
to this Mortgage;

2. A transfer of the Property to surviving co-owners following the death of a
co-owner when the transfer is automatic according to law; and

3. Any other transfer which under federal law may be made without giving the
Holder the right to require Immediate Payment in Full.

If the Holder requires Immediate Payment In Full under this Paragraph O, the
Holder will send you in the manner described in Paragraph L of this Section V, a
notice which states this requirement. The notice will give you at least ten
(10) days to make the required payment. The ten (10) day period will begin on
the date the notice is mailed or if it is not mailed, on the date the notice is
delivered. If you do not make the required payment during that period, the
Holder may bring a lawsuit for foreclosure and sale under Paragraph P of this
Section V without giving you any further

 

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notice or demand for payment or may foreclose under power of sale under
Paragraph P of this Section V. (See Paragraph P of this Section V for
definitions of “foreclosure and sale” and “under power of sale”).

P. HOLDER’S RIGHTS IF BORROWER FAILS TO KEEP PROMISES AND AGREEMENTS. If you do
not keep your promises and agreements made in the Note or this Mortgage, the
Holder may take any action against you that is allowed by law or this Mortgage.
For example, the Holder may sue you to collect any money you owe the Holder with
or without also suing to foreclose and sell the Property (foreclosure and sale
is explained later in this Paragraph P); to stop you from breaking your promises
and agreements (known as an action to enjoin); or to force you to keep your
promises and agreements (known as an action for specific performance).

If all of the conditions stated in the following subparagraphs 2.a, b and c of
this Paragraph P are satisfied, the Holder may also require that you pay
immediately the entire amount then remaining unpaid under the Note and under
this Mortgage (known as an “acceleration” of the Debt). The Holder may do this
without making any further demand for payment. This requirement will be called
“Immediate Payment In Full.”

If the Holder requires Immediate Payment In Full, the Holder:

1. May bring a lawsuit to take away all of your remaining rights in the Property
and to have the Property sold. At this sale the holder or another person may
acquire the Property. This is known as “foreclosure and sale.” In any lawsuit
for foreclosure and sale, the Holder will have the right to collect all costs
allowed by law; or

2. May foreclose under power of sale. This means that the Holder may have all of
your remaining rights in the Property taken away and have the Property sold
without having to file a lawsuit. To do this, the Holder must comply with the
law on foreclosure under power of sale that is stated in Chapter 667 of the
Hawaii Revised Statutes, as amended.

The Holder may require Immediate Payment In Full under this Paragraph P only if
all of the following conditions are satisfied:

a. You fail to keep any promise or agreement made in this Mortgage, including
the promises to pay when due the amounts that you owe to the Holder under the
Note and under this Mortgage; and

b. The Holder sends to you, in the manner described in Paragraph L of this
Section V, a notice that states:

(1) The promise or agreement that you failed to keep;

(2) The action that you must take to correct that failure;

(3) A date by which you must correct the failure. That date must be at least ten
(10) days from the date on which the notice is mailed to you, or if it is not
mailed, from the date on which it is delivered to you;

(4) That if you do not correct the failure by the date stated in the notice, you
will be in default and the Holder may require Immediate Payment In Full, and the
Holder or another person may acquire the Property by means of foreclosure and
sale or under power of sale;

(5) That you may speak with a named representative of the Holder to discuss any
questions which you have about the matters stated in the notice;

(6) That if you satisfy the conditions stated in Paragraph P of this Section V,
you will have the right to have any lawsuit for foreclosure and sale
discontinued and to have the Note and this Mortgage remain in full effect as if
Immediate Payment In Full had never been required; and

 

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(7) That you have the right in any lawsuit for foreclosure and sale to argue
that you kept your promises and agreements under the Note and under this
Mortgage, and to present any other defenses that you may have.

c. You do not correct the failure stated in the notice from the Holder by the
date stated in that notice.

To sell the Property in foreclosure, the Holder may sign and deliver a legal
document sufficient to transfer the Property to the purchaser at the foreclosure
sale. You give the Holder the power and right to sign and deliver such a
document on your behalf, and you may not and cannot take this power and right
away from the Holder. In legal terms, you appoint the Holder as your
“attorney-in-fact,” which appointment is coupled with an interest and,
therefore, is irrevocable even if you die or become incompetent.

The proceeds from any foreclosure and sale, whether by lawsuit or under power of
sale, shall be applied: (i) first to pay all costs and expenses of the sale,
including court costs and attorney’s fees, and (ii) then as stated in Paragraph
B of this Section V. If, however, the proceeds are not sufficient to pay all
these sums and all the other sums you owe the Holder, unless waived by the
Holder, you must still pay the Holder the difference (known as the
“deficiency”). You promise to pay any deficiency on demand from the Holder. The
Holder may force you to keep your promise to pay any deficiency, even if you
have lost all rights to the Property and even if the laws of the place where you
live (“your home state” if you do not live in Hawaii), would not permit the
Holder to enforce this promise if the Property is located there. The Holder may
take any action against you to collect the deficiency, plus all of the Holder’s
costs of collection, including its attorney’s fees, that is allowed by law and
this Mortgage.

Q. BORROWER’S RIGHT TO HAVE HOLDER’S FORECLOSURE AND SALE DISCONTINUED. Even if
the Holder has required Immediate Payment In Full, you may have the right to
have discontinued any lawsuit brought by the Holder for foreclosure and sale or
any foreclosure under power of sale or for other enforcement of this Mortgage.
You will have this right at any time before a judgment has been entered
enforcing this Mortgage, or before the sale is made by a foreclosure under power
of sale, if you satisfy the following conditions:

1. You pay to the Holder the full amount that would have been due under this
Mortgage and the Note, if the Holder had not required Immediate Payment In Full;

2. You correct your failure to keep any of your other promises or agreements
made in this Mortgage;

3. You pay all of the Holder’s reasonable expenses in enforcing this Mortgage
including, for example, reasonable attorney’s fees; and

4. You do whatever the Holder reasonably requires to assure that the Holder’s
rights in the Property, the Holder’s rights under this Mortgage, and your
obligations under the Note and under this Mortgage continue unchanged.

If you fulfill all of the conditions in this Paragraph Q, then the Note and this
Mortgage will remain in full effect as if Immediate Payment In Full had never
been required.

If, however, you do not fulfill all of these conditions, you (and all persons
who have or claim rights in the Property that depend on your rights in the
Property) will lose all rights to the Property, and will not have any right to
get them back. In legal terms, you (and such other persons) will have no
“redemption rights.”

R. HOLDER’S RIGHTS TO RECEIVE RENTAL PAYMENTS FROM THE PROPERTY. If there is a
judgment for the Holder in a lawsuit for foreclosure and sale, you will pay to
the Holder reasonable rent from the date the judgment is entered for as long as
you continue to have the right to occupy the Property. This does not, however,
give you the right to occupy the Property.

 

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S. HOLDER’S OBLIGATION TO DISCHARGE THIS MORTGAGE WHEN THE NOTE AND THIS
MORTGAGE ARE PAID IN FULL. When the Holder has been paid all amounts due under
the Note and under this Mortgage, the Holder will discharge this Mortgage by
delivering a certificate stating that this Mortgage has been satisfied. You will
not be required to pay the Holder for the discharge, but you must pay all costs
of recording the discharge in the proper official records.

T. AGREEMENT ABOUT USURY. Usury laws are laws that control the amount of
interest that may be legally paid. You and the Holder intend to comply with the
applicable Hawaii usury laws. If, however, it is determined that any part of any
Interest payment you make would be in excess of the maximum amount allowed by
law, that part will be treated as a payment of Principal.

U. AGREEMENT ABOUT PREPAYMENT. “Prepayment” means payment of Debt earlier than
the time you promise to do so. You may prepay the entire balance at any time as
long as you also pay all other amounts you owe the Holder under the Note and
this Mortgage. You may prepay any part of the unpaid balance at any time you
make a monthly payment. The only effect of a Prepayment will be to reduce the
remaining unpaid Principal. You must continue to pay monthly installments in the
same amount and on the same schedule as before, until the entire Debt is paid.
You will not be charged any penalty or premium for prepaying.

V. RIGHTS OF THE BORROWER AND THE HOLDER ARE NOT AFFECTED BY LATER PAYMENT OR
ANY PREVIOUS LACK OF ENFORCEMENT. The Holder and you may overlook a violation of
any part of the Note or this Mortgage by the other without losing the right to
enforcement later of the same or any other part of the Note or this Mortgage.
The Holder will not lose enforcement rights even if the Holder accepts any
payment you make. The Holder may still take action against you for any default,
including your not paying on time.

W. COLLECTION AGENCY AND COSTS. The Holder has the right at any one or more
times to hire an agent (and to change this agent) to collect the payments due
from you under the Note and this Mortgage. You must pay the costs of
establishing any such collection agency and the fee charged by that agency for
servicing your account. You must also pay any fees charged by any such
collection agent due to any late payments you make or any other failure by you
to keep your promises made in the Note and this Mortgage.

X. FUTURE ADVANCES. Upon request by Borrower, Holder, at Holder’s option, may
make Future Advances to Borrower. Such Future Advances, with interest thereon,
shall be secured by this Mortgage when evidenced by promissory notes stating
that said notes are secured hereby. At no time shall the principal amount of the
indebtedness secured by this Mortgage, not including sums advanced in accordance
herewith to protect the security of this Mortgage, exceed one hundred fifty
percent (150%) of the original amount of the Note.

Y. SECURITY AGREEMENT. This document is both a mortgage of all interests in real
property and a security agreement under the Uniform Commercial Code (the “Code”)
as to all personal property and fixtures which may be described in this
document. Therefore, the Holder has and may enforce a security interest in the
personal property and fixtures, and will have all rights of a secured party
under the Code. This remedy, however, will not preclude the Holder from pursuing
any other remedy available to the Holder.

Z. NOTICE REGARDING INSURANCE. Notice is hereby given by the Holder
(Ritz-Carlton) to You (Borrower/Mortgagor) that you (Borrower/Mortgagor) are
free to procure any insurance policy required by this instrument from any
insurance company authorized to do business in the State of Hawaii.

IN WITNESS WHEREOF, the Borrower(s) has signed this Mortgage as of the day and
year first above written.

 

          Borrower     Borrower

 

          Borrower     Borrower

 

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NOTARY ACKNOWLEDGMENT

 

STATE OF ___________________________   )     ) SS:
COUNTY OF _________________________   )

On this _________ day of ___________, 20__, before me personally appeared
_____________________________________, to me personally known or proved to me on
the basis of satisfactory evidence of his/her/their signature(s) and identity to
be the aforesaid person(s), who, being by me duly sworn or affirmed, did say
that such person(s) executed the foregoing instrument as the free act and deed
of such person(s), and if applicable, in the capacities shown, having been duly
authorized to execute such instrument in such capacities.

 

Signature of Notary Print Notary Name:_________________________ Notary Public,
in and for said State My commission expires:____________________

[Below Notary Certification to be completed by Hawaii Notary Only]

STATE OF HAWAII NOTARY CERTIFICATION

Document Identification or Description: PURCHASE MONEY MORTGAGE, SECURITY
AGREEMENT AND FINANCING STATEMENT WITH POWER OF SALE

¨Date of Document: _______ or xUndated at time of notarization

Jurisdiction: __________ Circuit (in which notarial act is performed)

Number of Pages: Fifteen (15)

Date of Certificate: ____________________

___________________________________

Notary Public Signature

Print Name: __________________________

Notary Public, State of Hawaii

(Stamp or Seal)

 

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EXHIBIT “A”

____________(_____) Club Interest(s) in the Club in Club Unit No. _______
identified as Club Interest No. ______, consisting of the following:

 

I. _______________(______) fee simple interest(s) in the Club consisting of an
undivided one-twelfth (1/12) interest as tenant in common with the holders of
other undivided interests in and to the following:

 

  (A) Apartment No. _________ (“Apartment”) of the condominium project
(“Project”) known as “KAPALUA BAY CONDOMINIUM,” as established by that certain
Declaration of Condominium Property Regime (“Condominium Declaration”) dated
April 18, 2006, recorded at the Bureau of Conveyances of the State of Hawaii as
Document No. 2006-083256, as amended, and as shown on the plans thereof filed at
said Bureau as Condominium Map No. 4222, as the same may be amended from time to
time. The description of the land set forth in the Condominium Declaration is
incorporated herein by this reference.

Together with appurtenant easements as follows:

 

  (1) Nonexclusive easements for use of the common elements in accordance with
the purpose for which they are intended without hindering or encroaching upon
the lawful rights of the other apartment owners, subject always to the exclusive
use of the limited common elements as provided in the Condominium Declaration.

 

  (2) A nonexclusive easement in the other apartments in the building in which
the Apartment is located for support.

 

  (3) Nonexclusive easements for use of the common elements for ingress to,
egress from, utility services for and support, maintenance and repair of the
Apartment.

 

  (4) In the case of encroachment by the Apartment upon any other apartment or
common elements, a valid easement for such encroachment and the maintenance
thereof shall and does exist in favor of and appurtenant to the Apartment herein
conveyed for so long as such encroachment continues. In the event any building
of the Project shall be partially or totally destroyed and then rebuilt, or in
the event of any shifting, settlement or movement of any portion of the Project,
encroachments upon any part of the common elements or apartments due to the same
shall be permitted, and valid easements for such encroachments and the
maintenance thereof shall exist in favor of and appurtenant to the Apartment
herein conveyed for so long as such encroachment continues.

 

  (5) The right to use those certain limited common elements of the Project, if
any, which are described in the Condominium Declaration as being appurtenant to
the Apartment, provided that such easement shall be deemed conveyed or
encumbered with the Apartment even though such interest is not expressly
mentioned or described in the conveyance.

EXCEPTING AND RESERVING AND SUBJECT TO all of the terms and conditions of the
Condominium Declaration and easements for encroachments appurtenant to other
apartments as they arise in the manner set forth in the preceding paragraph, now
or hereafter existing thereon, and subject also to easements for access to the
property from time to time during reasonable hours as may be necessary for the
operation of the property or for making emergency repairs therein to prevent
damage to the common elements or to another apartment or apartments or for the
installation, repair or replacement of any common elements.

 

  (B)

An undivided __________ percentage interest with regard to Apartment No.______,
as established by the Condominium Declaration, in and to the common elements of
the Project,

 

EXHIBIT “A”

(Page 1 of ___)

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  including the land described in said Condominium Declaration, as tenant in
common with the holders of other undivided interests in and to said common
elements.

 

II. The exclusive right to reserve and then use and occupy the Apartment in
accordance with, and subject to, that certain The Kapalua Bay Vacation Ownership
Project Declaration of Covenants, Conditions and Restrictions dated June 9,
2006, recorded at said Bureau as Document No. 2006-112198, as amended (the “Club
Declaration”) and Club Reservation Procedures, together with the right in common
with owners of all other apartments to use and enjoy the common elements of the
Project during the Use Period assigned to each aforesaid Club Interest.

 

III. Membership in the Vacation Owners Association.

Being also portions of the premises described in those certain instruments dated
August 31, 2004, made by and between Maui Land & Pineapple Company, Inc., a
Hawaii corporation, as Grantor, and Kapalua Bay, LLC, a Delaware limited
liability company, as Grantee, recorded at said Bureau as Document
No. 2004-178884 and 2004-178885.

SUBJECT, HOWEVER, to all encumbrances set forth in the Club Declaration, as
amended, which are incorporated herein by this reference.

 

EXHIBIT “A”

(Page 2 of ___)

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MVC TRUST SAMPLE

[UPON CLOSING OF THE PURCHASE TO WHICH THIS NOTE APPLIES, THE UNDERSIGNED HEREBY
AUTHORIZE(S) CLOSING AGENT OR HOLDER TO COMPLETE THIS NOTE BY INSERTING THE DATE
OF THE NOTE AND APPLICABLE DATES FOR COMMENCEMENT OF PAYMENTS DUE HEREUNDER, THE
MONTHLY PAYMENT DATE AND THE FINAL PAYMENT DATE.]

NOTE SECURED BY MORTGAGE

INCLUDING CONTINUING GUARANTY

Interests (numbered for administrative purposes:        )

MVC Trust

 

US$                , 20    

FOR VALUE RECEIVED, the undersigned                                         
(“Borrower(s)”) promise(s) to pay to the order of MARRIOTT OWNERSHIP RESORTS,
INC. (“MORI”) (said party or any other party to whom MORI may transfer and
assign this Note and who holds this Note from time to time is hereinafter called
the “Holder”), Post Office Box 8038, Lakeland, Florida 33802, or order, the
principal sum of      U.S. Dollars (US $          with interest on the unpaid
balance from                                         , until paid, at the rate
             of percent per annum (    %) (calculated on the basis of a 360 day
year, collected for the actual number of days principal is outstanding in any
calendar year). Principal and interest shall be payable in lawful money of the
United States at the Holder’s address set forth above, or such other place as
the Holder may, from time to time, designate, in consecutive monthly
installments of U.S. Dollars (US $          on the      day of each month and
continuing thereafter on the same day of each month beginning
                                        , for a period of      months with the
remaining unpaid principal balance, together with accrued interest thereon, due
and payable, if not sooner paid, on                                         .

To the extent that other individuals, in addition to the Borrower(s), execute
this Note, such individuals sign the Note on behalf of the Borrower(s) and on
behalf of themselves as an individual, and hereby agree to personally guaranty
the timely payment of all amounts due from Borrower under or in connection with
this Note.

The indebtedness evidenced by this Note is secured by a Mortgage, dated of even
date herewith, creating a lien on the real property described therein (the
“Property”). Reference is made to said Mortgage as to MORI’s/Holder’s/Lender’s
rights as to acceleration of the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a              service fee.

Borrower(s) shall pay to the Holder a late charge of Six percent (6%) for any
monthly installment not received by the Holder within ten (10) days after the
date the installment is due.

Each payment shall be credited first to amounts due pursuant to Paragraph 2 of
the Mortgage, then to advances, if any, made by the Lender pursuant to Paragraph
7 of the Mortgage, then to the costs, fees, expenses and other amounts incurred
and advanced by the Holder in the enforcement of its rights hereunder,
including, without limitation, costs and reasonable attorneys’ fees described
below, then to unpaid service fees, then to interest due hereunder, then to
principal due hereunder, then to unpaid late charges, if any, then to interest
on any Future Advances (as defined in the Mortgage), then to principal on any
Future Advances.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Demand, presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be a joint
and several obligation of all makers, sureties, guarantors and endorsers, and
shall be binding upon them and their heirs, personal representatives, successors
and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon any one of the following events of default:

 

  a) failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) failure of Borrower(s) to perform any other covenant or agreement of
Borrower(s) in this Note or the Mortgage within fifteen (15) days after the
mailing of notice from the Holder to the Borrower(s) specifying the nature of
such failure; and

 

  c) the insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s).

The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, reasonable attorneys’ fees, whether or not action be instituted
hereon, as well as actual costs of trial and appellate proceedings.

In the event of any default by the Borrower(s) hereunder, Holder at its sole
option, may charge the Borrower(s) the highest interest rate allowed by law
and/or pursue any and all remedies available to it under applicable law.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given upon depositing same in any U.S. post office, postage prepaid, addressed
to Borrower(s) at the address stated below, or to such other address as
Borrower(s) may designate by written notice to the Holder. Any notice to the
Holder shall be given by mailing such notice by certified mail, return receipt
requested, to the Holder at the address stated in the first paragraph of this
Note, or at such other address as may have been designated by written notice to
Borrower(s). Any notice provided for in this Note shall be deemed to have been
given to Borrower(s) or the Holder when given in the manner herein designated.

THIS NOTE SHALL BE GOVERNED BY, CONSTRUED UNDER AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA AND THE COURTS OF THE STATE OF
FLORIDA IN THE COUNTY OF ORANGE SHALL BE THE EXCLUSIVE COURTS OF JURISDICTION
AND VENUE FOR ANY LITIGATION OR OTHER PROCEEDING THAT MAY BE BASED ON, ARISE OUT
OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, UNLESS OTHERWISE REQUIRED BY LAW.
HOLDER AND BORROWER(S) HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON,
OR ARISING OUT OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR HOLDER EXTENDING THE LOAN
EVIDENCED BY THIS NOTE.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that: (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

Time is of the essence in the performance of each and every obligation
represented by this Note.

Borrower/Purchaser:

 

 

    BORROWER’S ADDRESS:

 

   

 

   

 

   

 

   

 

   

(Execute Original Only)

DOCUMENTARY STAMP TAXES HAVE BEEN PAID AND THE PROPER AMOUNTS AFFIXED TO THE
MORTGAGE

625815-2 (3.1.12)

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MVC TRUST SAMPLE

 

This instrument prepared by

and after recording return to:

 

Attn: Linda Sellars

Marriott Resorts Title Company, Inc.

1200 Bartow Road, Suite 10

Lakeland, Florida 33801

  This space reserved for recorder:

UPON CLOSING OF THE PURCHASE TO WHICH THIS MORTGAGE APPLIES, THE UNDERSIGNED
HEREBY AUTHORIZE(S) CLOSING AGENT TO COMPLETE THIS MORTGAGE BY INSERTING THE
APPROPRIATE DATE OF THE MORTGAGE AND TO COMPLETE, AS NECESSARY, THE INFORMATION
RELATING TO THE BENEFICIAL INTEREST(S) BEING ENCUMBERED BY THIS MORTGAGE.

MORTGAGE

 

 

THIS MORTGAGE is made this _____ day of ____________, ____, between the
Mortgagor(s), _______________________

 

 

(herein “Borrower(s)”), whose post office address is c/o Marriott Resorts
Hospitality Corporation, P.O. Box 890, Lakeland, Florida 33802, County of Polk,
State of Florida, and the Mortgagee, MARRIOTT OWNERSHIP RESORTS, INC., a
Delaware corporation, the address of which is Post Office Box 24747, Lakeland,
Florida 33802, (said party, its successors and assigns is herein called
“Lender”).

WHEREAS, Borrower(s) is/are indebted to Lender in the principal sum of
_________________________________________ U.S. Dollars (US$____________), which
indebtedness is evidenced by Borrower’s Note of even date herewith (herein
“Note”), providing for monthly installments of principal and interest, with the
balance of indebtedness, if not sooner paid, due and payable on
_______________________, which is _____ months from the date hereof.

TO SECURE to Lender (a) the repayment of the indebtedness evidenced by the Note,
with interest thereon, the payment of all other sums, with interest thereon,
advanced in accordance herewith to protect the security of this Mortgage, and
the performance of the covenants and agreements of Borrower(s) herein contained,
and (b) the repayment of any future advances, with interest thereon, made to
Borrower(s) by Lender pursuant to Paragraph 20 hereof (herein “Future
Advances”), Borrower(s) does hereby mortgage, grant and convey to Lender and
Lender’s successors and assigns the following described property:

A timeshare estate as defined by Section 721.05, Florida Statutes, more fully
described as:

             Interests (numbered for administrative purposes:
                    ) in the MVC Trust (“Trust”) evidenced for administrative,
assessment and ownership purposes by                     Points (250 Points for
each Interest), which Trust was created pursuant to and further described in
that certain MVC Trust Agreement dated March 11, 2010, executed by and among
First American Trust, FSB, a federal savings bank, solely as trustee of Land
Trust No. 1082-0300-00, (a.k.a MVC Trust), Marriott Ownership Resorts, Inc., a
Delaware corporation, and MVC Trust Owners Association, Inc., a Florida
corporation not-for-profit, as such agreement may be amended and supplemented
from time to time (“Trust Agreement”), a memorandum of which is recorded in
Official Records Book 10015, Page 4176, Public Records of Orange County, Florida
(“Trust Memorandum”). The Interests shall have a Use Year Commencement Date of
                     (subject to Section 3.5 of the Trust Agreement).

TO HAVE AND TO HOLD unto Lender and Lender’s successors and assigns, forever,
together with all use rights and appurtenant easements, rights, rents,
royalties, mineral, oil and gas rights and profits, water, water rights, and
water stock, and all other appurtenances to such property, and all improvements
and all fixtures now or hereafter constituting such property, all of which,
including replacements and additions thereto, shall be deemed to be and remain a
part of the property covered by this Mortgage; and all of the foregoing,
together with said property, are herein referred to as the “Property”.

Borrower(s) covenants that Borrower(s) is/are lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant and convey the Property,
that the Property is unencumbered, and that Borrower will warrant and defend
generally the title to the Property against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions
to coverage in any title insurance policy insuring Lender’s interest in the
Property.

Borrower(s) and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower(s)
shall promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by this Mortgage.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower(s), Borrower(s) shall pay to Lender on the
day when monthly installments of principal and interest are payable under the
Note, until the Note is paid in full, a sum (herein “Funds”) equal to
one-twelfth of Borrower’s share of the yearly taxes and assessments relating to
the subject Property encumbered by this Mortgage and one-twelfth of the annual
assessments due from Borrower under the Trust Agreement (herein “Trust
Assessments”), or such other amounts or for such other periods other than
monthly, e.g., quarterly or one-fourth, etc., all as reasonably estimated
initially and from time to time by Lender on the basis of assessments and bills
and reasonable estimates thereof.

 

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If Lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, and Trust
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower(s) interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower(s) any interest on earnings on the Funds.
Lender shall give to Borrower(s), without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes for which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Mortgage.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Trust Assessments shall exceed the amount required to pay such taxes,
assessments, and Trust Assessments as they fall due, such excess shall be, at
Borrower’s option, either promptly repaid to Borrower(s) or credited to
Borrower(s) on monthly installments of Funds. If the amount of the Funds held by
Lender shall not be sufficient to pay taxes, assessments, and Trust Assessments
as they fall due, Borrower(s) shall pay to Lender any amount necessary to make
up the deficiency within thirty (30) days from the date of a notice mailed by
Lender to Borrower(s) requesting payment thereof, but in no event shall Lender
require payment in advance for taxes and assessments to be held and disbursed as
set forth hereunder in an amount which exceeds the estimate of the next year’s
amount for same.

Upon payment in full of all sums secured by this Mortgage, Lender shall promptly
refund to Borrower(s) any Funds held by Lender. If under Paragraph 18 hereof the
Property is sold or the Property is otherwise acquired by Lender, Lender shall
apply, no later than immediately prior to the sale of the Property or its
acquisition by Lender, any Funds then held by Lender as a credit against the
sums secured by this Mortgage.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and Paragraphs 1 and 2 hereof shall
be applied by Lender first in payment of amounts payable to Lender by
Borrower(s) under Paragraph 2 above, if any, then against advances, if any, made
by Lender pursuant to Paragraph 7 of this Mortgage, then to costs, fees,
expenses and other amounts incurred and advanced by the Lender in the
enforcement of its rights under the Note and this Mortgage, including, without
limitation, costs and reasonable attorneys’ fees, then to unpaid service fees,
then to interest payable on the Note, then to the principal of the Note, then to
unpaid late charges, if any, then to interest on any Future Advances made at
Lender’s option pursuant to Paragraph 20 hereof, then to principal on Future
Advances, if any, made at Lender’s option pursuant to Paragraph 20 hereof.

4. Charges; Liens. Borrower(s) shall promptly pay, when due, all Trust
Assessments imposed by MVC Trust Owners Association, Inc., or other governing
body of the Trust (the “Trust Association”) pursuant to the provisions of the
Trust Agreement, Bylaws of the Trust Association, or other constituent documents
of the Trust.

Borrower(s) shall pay all taxes, assessments and other charges, fines and
impositions attributable to the Property which may attain a priority over this
Mortgage, in the manner provided under Paragraph 2 hereof or, if not paid in
such manner, by Borrower(s) making payment, when due, directly to the payee
thereof. Borrower(s) shall promptly furnish to Lender all notices of amounts due
under this Paragraph, and in the event Borrower(s) shall make payment directly,
Borrower(s) shall promptly furnish to Lender receipts evidencing such payments.
Borrower(s) shall promptly discharge any lien which has priority over this
Mortgage; provided, that Borrower(s) shall not be required to discharge any such
lien so long as Borrower(s) shall agree in writing to the payment of the
obligation secured by such lien in a manner acceptable to Lender and, if
requested by Lender, immediately post with Lender an amount necessary to satisfy
said obligation, or shall in good faith contest such lien by, or defend
enforcement of such lien in, legal proceedings which operate to prevent the
enforcement of the lien or forfeiture of the Property or any part thereof and,
if requested by Lender, immediately post with Lender an amount necessary to
satisfy said obligation.

5. Hazard Insurance. Borrower(s) shall keep the improvements now existing or
hereafter erected on the Trust Property (as defined in the Trust Agreement)
insured against loss by fire, hazards included within the term “extended
coverage”, and such other hazards as Lender may require and in such amounts and
for such periods as Lender may require; provided, that Lender shall not require
that the amount of such coverage exceed that amount of coverage required to pay
the sums secured by this Mortgage. This obligation shall be deemed satisfied so
long as the Trust Association or other owners’ association governing the Trust
Property maintains a “master” or “blanket” policy for the Trust Property in
accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower(s),
the Trust Association, or other owners’ association governing the Trust
Property, subject to approval by Lender; provided that such approval shall not
be unreasonably withheld or delayed. If required, all premiums on insurance
policies shall be paid in the manner provided under Paragraph 2 hereof, or, if
not paid in such manner, by Borrower(s), the Trust Association, or other owners’
association governing the Trust Property making payment, when due, directly to
the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower(s) shall give Lender prompt notice of any lapse
in hazard insurance coverage. In the event of loss, Borrower(s) shall give
prompt notice to the insurance carrier and Lender. Lender may make proof of loss
if not made promptly by Borrower(s).

Pursuant to the terms of the Trust Agreement, insurance proceeds shall first be
applied to restoration or repair of the Trust Property damaged. To the extent
such insurance proceeds exceed the cost of such restoration or repair and the
Board of Directors of the Trust Association decides to disburse such excess,
Borrower’s share of such excess shall then be applied to the sums secured by
this Mortgage, with the excess, if any, paid to Borrower(s).

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments. If under Paragraph 18 hereof the Property is
acquired by Lender, all right, title and interest of Borrower(s) in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Trust Property prior to the sale or acquisition shall pass to
Lender to the extent of the sums secured by this Mortgage immediately prior to
such sale or acquisition.

6. Preservation and Maintenance of Trust Property; Trust. Borrower(s) shall keep
the Trust Property in good repair and shall not commit waste or permit
impairment or deterioration of the Trust Property. Borrower(s) shall perform all
of Borrower’s obligations under the Trust Agreement, the Bylaws of the Trust
Association, and constituent documents. Borrower(s) shall take such actions as
may be reasonable to ensure that the Trust Association, or other owners’
association governing the Trust Property, maintains a public liability insurance
policy acceptable in form, amount, and extent of coverage to Lender. If any
rider is executed by Borrower and recorded together with the Mortgage, the
covenants and agreements of such rider shall be incorporated into and amend and
supplement the covenants and agreements of this Mortgage as if the rider were a
part hereof.

7. Protection of Lender’s Security. If Borrower(s) fail(s) to perform the
covenants and agreements contained in this Mortgage, or if any action or
proceeding is commenced which materially affects Lender’s interest in the
Property, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankrupt or decedent,
then Lender at Lender’s option, upon notice to Borrower(s), may make such
appearances, disburse such sums and take such action as Lender deems necessary
to protect Lender’s interest, including, but not limited to, disbursement of
funds to pay reasonable attorneys’ fees and entry upon the Trust Property to
make repairs.

Any amounts disbursed by Lender pursuant to this Paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower(s) secured by this
Mortgage. Unless Borrower(s) and Lender agree to other terms of payment, such
amount shall be payable upon notice from Lender to Borrower(s) requesting
payment thereof, and shall bear interest from the date of disbursement at the
rate payable from time to time on outstanding principal under the Note unless
payment of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this Paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Trust Property, provided that Lender shall give Borrower(s)
notice prior to any such inspection specifying reasonable cause therefor related
to Lender’s interest in the Property or Trust Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower(s) in connection with any condemnation or
other taking of all or any part of the Property or Trust Property, or for any
conveyance in lieu of condemnation, pursuant to the terms of the Trust
Agreement, are hereby assigned to Lender and shall be paid to Lender as provided
hereunder.

 

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Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments.

10. Borrower(s) Not Released. Extension of the time for payment or modification
of amortization of the sums secured by this Mortgage granted by Lender to any
successor in interest of Borrower(s) shall not operate to release, in any
manner, the liability of the original Borrower(s) and Borrower’s successors in
interest. Lender shall not be required to commence proceedings against such
successor or refuse to extend time for payment or otherwise modify amortization
of the sums secured by this Mortgage by reason of any demand made by the
original Borrower(s) and Borrower’s successors in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Mortgage.

12. Remedies Cumulative. All remedies provided in this Mortgage are distinct and
cumulative to any other right or remedy under this Mortgage or afforded by law
or equity, and may be exercised concurrently, independently or successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of Paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower(s). All covenants and
agreements of Borrower(s) shall be joint and several. The captions and headings
of the paragraphs of this Mortgage are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower(s) provided for in this Mortgage
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower(s) at the Borrower’s address as set forth in the Note, or at such
other address as Borrower(s) may designate by notice to Lender as provided
herein, and (b) any notice to Lender shall be given by certified mail, return
receipt requested, to Lender’s address stated herein or to such other address as
Lender may designate by notice to Borrower(s) as provided herein. Any notice
provided for in this Mortgage shall be deemed to have been given to Borrower(s)
or Lender when given in the manner designated herein. In the event of a judicial
action to enforce this Mortgage, Borrower hereby agrees that any notice required
or service of process made incident thereto shall be sufficient if made to the
above address or to the registered agent appointed for such purposes by Borrower
pursuant to Section 721.84 Florida Statutes. Borrower may change such address by
giving Lender notice of a change of address in writing to Lender’s address
stated herein.

15. Governing Law; Severability. This Mortgage shall be governed by the laws of
the state of Florida. In the event that any provision or clause of this Mortgage
or the Note conflicts with applicable law, such conflict shall not affect other
provisions of this Mortgage or the Note which can be given effect without the
conflicting provision, and to this end the provisions of the Mortgage and the
Note are declared to be severable.

16. Borrower’s Copy. Borrower(s) shall be furnished a copy of the Note and of
this Mortgage at the time of execution or after recordation hereof.

17. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold (or leased with an option to purchase) or
transferred by Borrower(s) without Lender’s prior written consent, excluding
(a) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, (b) the grant of any leasehold interest of three (3) years or less
not containing an option to purchase, or (c) the creation of a lien or
encumbrance subordinate to this Mortgage, Lender may, at Lender’s option,
declare all the sums secured by this Mortgage to be immediately due and payable.
Lender shall have waived such option to accelerate if, and only if, prior to the
sale or transfer, Lender and the person to whom the Property is to be sold or
transferred reach agreement in writing that the credit of such person is
satisfactory to Lender and that the interest payable on the sums secured by this
Mortgage shall be at such rate as Lender shall request and any assumption fee
set by Lender has been paid. If Lender has waived the option to accelerate
provided in this Paragraph 17, and if Borrower’s successor in interest has
executed a written assumption agreement accepted in writing by Lender, Lender
shall release Borrower(s) from all obligations under this Mortgage and the Note.
Assumption of Borrower’s Mortgage and Note shall be permitted only with written
approval of and at the sole discretion of Lender.

If Lender exercises such option to accelerate, Lender shall mail Borrower(s)
notice of acceleration in accordance with Paragraph 14 hereof. Such notice shall
provide a period of not less than fifteen (15) days from the date the notice is
mailed within which Borrower(s) may pay the sums declared due. If Borrower(s)
fails to pay such sums prior to the expiration of such period, Lender may,
without further notice or demand on Borrower(s), invoke any remedies permitted
by Paragraph 18 hereof.

        18. Acceleration; Remedies. Except as provided in Paragraph 17 hereof,
upon Borrower’s breach of any covenant or agreement of Borrower(s) in this
Mortgage, including the covenants to pay when due any sums secured by this
Mortgage, Lender prior to acceleration shall mail notice to Borrower(s) as
provided in Paragraph 14 hereof specifying: (1) the breach; (2) the action
required to cure such breach; (3) a date, not less than fifteen (15) days from
the date the notice is mailed to Borrower(s), by which such breach must be
cured; and (4) that failure to cure such breach on or before the date specified
in the notice may result in acceleration of the sums secured by this Mortgage,
foreclosure by judicial proceedings or other proceedings consistent with the
law, and sale of the Property. If Borrower fails to cure any such breach on or
before the date specified in the notice, Lender at Lender’s option, subject to
any right of reinstatement to which Borrower(s) is entitled under applicable
law, may declare without further demand all of the sums secured by this Mortgage
to be immediately due and payable and the lien against the Property created by
this Mortgage may be foreclosed in accordance with either a judicial foreclosure
procedure or a trustee foreclosure procedure and may result in the loss of the
Property. If Lender initiates a trustee foreclosure procedure, Borrower shall
have the option to object and Lender may proceed only by filing a judicial
foreclosure action. Lender shall be entitled to collect in such proceedings all
expenses of foreclosure, including, but not limited to, reasonable attorneys’
fees, court costs, and costs of documentary evidence, abstracts and title
reports.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower(s) hereby assigns to Lender the rents of the Property,
provided that Borrower(s) shall, prior to acceleration under Paragraph 18 hereof
or abandonment of the Property, have the right to collect and retain such rents
as they become due and payable.

Upon acceleration of the Note or abandonment of the Property, Lender shall be
entitled, without notice, to enter upon, take possession of and manage the
Property and to collect the rents of the Property, including those past due. All
rents collected shall be appointed first to payment of the costs of management
of the Property and collection of rents, including, but not limited to,
management fees, court costs, and reasonable attorneys’ fees, and then to the
sums secured by this Mortgage. The Lender shall be liable to account only for
those rents actually received. Borrower(s) shall not be entitled to possession
or use of the Property after abandonment or after the Lender has accelerated the
balance due under the Note. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Property. If a receiver is
appointed, any income from rents from the Property shall be applied first to the
costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower(s), Lender, at Lender’s option,
may make Future Advances to Borrower(s). Such Future Advances, with interest
thereon, shall be secured by this Mortgage whether or not evidenced by
promissory notes stating that said notes are secured hereby. At no time shall
the principal amount of the indebtedness secured by this Mortgage, not including
sums advanced in accordance herewith to protect the security of this Mortgage,
exceed one hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower(s) shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to:

(i) The abandonment of the Trust Property or termination of the Trust, except
for abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain;

(ii) any amendment to any provision of the Trust Agreement, Bylaws of the Trust
Association, or equivalent constituent documents of the Trust which provision is
for the express benefit of Lender; or

(iii) any action which would have the effect of rendering the public liability
insurance coverage maintained by the Trust Association, or other owners’
association governing the Property or Trust Property, unacceptable to Lender.

22. Lender’s Reserved Rights. Notwithstanding any rights granted to Borrower(s)
under the Trust Plan Documents (as defined in the Trust Agreement), the Lender
reserves the right to implement, at any time and in coordination with the Trust
Manager (as defined in the Trust Agreement), limitations and additional
procedures relative to the ability of Borrower(s) to use Points (as

 

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defined in the Trust Agreement) in a Use Year (as defined in the Trust
Agreement) prior to that when they would normally be available for use.

23. Attorneys’ Fees. As used in this Mortgage and in the Note, “attorneys’ fees”
shall include attorneys’ fees, if any, and related costs incurred by Lender in
the enforcement of its rights under the Note and/or Mortgage, whether or not
legal action is instituted, and any fees and costs of trial and appellate
proceedings.

24. Venue and Jurisdiction. THIS MORTGAGE SHALL BE GOVERNED BY, CONSTRUED UNDER
AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA
AND THE COURTS OF THE STATE OF FLORIDA IN THE COUNTY OF ORANGE SHALL BE THE
EXCLUSIVE COURTS OF JURISDICTION AND VENUE FOR ANY LITIGATION OR OTHER
PROCEEDING THAT MAY BE BASED ON, ARISE OUT OF, UNDER OR IN CONJUNCTION WITH THIS
MORTGAGE, UNLESS OTHERWISE REQUIRED BY LAW. HOLDER AND BORROWER(S) HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR
IN CONJUNCTION WITH THIS MORTGAGE, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION
IS A MATERIAL INDUCEMENT FOR LENDER EXTENDING THE LOAN EVIDENCED BY THE NOTE.

IN WITNESS WHEREOF, Borrower(s) has/have executed this Mortgage on the day and
year first written above.

Signed in the presence of:

          Mortgagor     Mortgagor

          Printed Name     Printed Name

          Mortgagor     Mortgagor

          Printed Name     Printed Name

STATE OF ______________________)     ACKNOWLEDGMENT COUNTY OF
____________________)    

This Mortgage was acknowledged before me this              day of
                            ,                  by
                                ,                                 ,
                                     and                                     ,
(i) who is (are) personally known to me or (ii) has (have) produced
                                                  [list type of identification]
as identification.

   Print Name: ________________________________ NOTARY PUBLIC My Commission
Expires: ______________________ Commission No: _____________________________

(ADDITIONAL ACKNOWLEDGMENT, IF MORTGAGORS SIGN BEFORE DIFFERENT NOTARIES)

 

STATE OF ______________________)     ACKNOWLEDGMENT COUNTY OF
____________________)    

This Mortgage was acknowledged before me this              day of
                            ,                  by
                                        ,                                 ,
                                     and                                     ,
(i) who is (are) personally known to me or (ii) has (have) produced
                                 [list type of identification] as
identification.

   Print Name: ________________________________ NOTARY PUBLIC My Commission
Expires: ______________________ Commission No: _____________________________

 

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ARIZONA SAMPLE (MVC)

(INDIVIDUAL)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable dates for commencement of payments due hereunder, the monthly payment
date and the final payment date. DO NOT DESTROY THIS NOTE.

PROMISSORY NOTE

Ownership Interest No.(s):

_______________________________________

Canyon Villas Vacation Ownership Program

 

US $___________________________

   _____________________, 200_

FOR VALUE RECEIVED, the undersigned                      (“Borrower(s)”)
promise(s) to pay to the order of MARRIOTT OWNERSHIP RESORTS, INC., (said party
or any other party to whom this Note may be transferred and assigned is
hereinafter called the “Holder”), P.O. Box 8038, Lakeland, Florida 33802, or
order, the principal sum of                                      U.S. Dollars
(US $                        ), with interest on the unpaid balance from the
date of this Note, or                          (whichever is later), until paid,
at the rate of                              percent (        %) per annum.
Interest shall be calculated by applying the stated annual rate against the
unpaid principal for the actual number of days elapsed divided by a 360 day
year. Principal and interest shall be payable, without offset, in lawful money
of the United States at the Holder’s address set forth above, or such other
place as the Holder may from time to time designate, in consecutive monthly
installments of                              U.S. Dollars (US
$                        ), beginning on the                  day of
                 and continuing thereafter on the same day of each month, with
the remaining unpaid balance, together with accrued interest thereon, due and
payable, if not sooner paid, on                                         .

The indebtedness evidenced by this Note is secured by a Trust Deed, dated of
even date herewith, creating a lien on the real property described therein (the
“Ownership Interest(s)”), located in Phoenix, Maricopa County, Arizona.
Reference is made to said Trust Deed for rights of the Holder upon acceleration
of the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a $5.00 service fee. If any monthly
installment is not received by the Holder within ten (10) days after the date
the installment is due, Borrower(s) shall pay to the Holder a late charge of six
percent (6%) of such late installment or $25.00, whichever is greater. The
Holder may apply any payment received by it to the payment of all late charges
then owing before application to interest or principal. Such late charge is in
addition to and not in lieu of or diminution of any other rights and remedies of
the Holder of this Note.

Each monthly payment made by Borrower(s) shall be applied as of its scheduled
due date. Each payment shall be credited on account of amounts due in the order
specified in Paragraph 20 of the Trust Deed.

Borrower(s) may prepay the principal amount outstanding in whole or in part
without a penalty. Any partial prepayment in excess of the amounts then due
shall be applied against the principal amount outstanding but shall not postpone
the due date of any subsequent monthly installments or change the amount of such
installments.

The makers, sureties, guarantors and endorsers hereof severally waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution. This Note shall be the joint and
several obligation of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their respective heirs, personal representatives,
successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

 

  a. Failure of Borrower(s) to pay when due any installment payable hereunder
which remains unpaid after a date specified in a notice (not less than fifteen
(15) days from the date such notice is mailed) from the Holder to Borrower(s);

 

  b. The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s);

 

  c. The sale (or lease with option to purchase) or transfer of all or any part
of the Ownership Interest(s) or any interest therein without the prior written
consent of the Holder, excluding a transfer by devise, descent or by operation
of law upon the death of a joint tenant therein; or

 

  d. Failure of Borrower(s) to comply with the covenants of the Trust Deed after
notice and failure to cure as provided in the Trust Deed.

The Holder may exercise its option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, attorney’s fees, whether or not action be instituted hereon.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given after mailing same by U.S. mail, postage prepaid (or such other more
expeditious method as may be appropriate in the case of foreign addresses, as
Holder may choose in its discretion), addressed to Borrower(s) at the address
stated below, or to such other address as Borrower(s) may designate by written
notice to the Holder. Any notice to the Holder shall be deemed to have been
given by mailing such notice by U.S. certified mail, return receipt requested,
(or in the case of a notice originating in a foreign country, by such other
method that results in the Holder acknowledging in writing receipt of the
notice), at 6649 Westwood Boulevard, Suite 500, Orlando, Florida 32821-6090, or
at such other address as may be designated by written notice to Borrower(s).

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully

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assert the claim or defense of usury; and (iii) if any excess interest is
provided for or collected, it shall be deemed a mistake and the same shall
either be refunded to Borrower(s) or be credited on the unpaid principal amount
hereof, and this Note shall be automatically deemed reformed so as to permit
only the collection of the maximum non-usurious rate and amount of interest
allowable under applicable law.

This Note shall be governed by, construed under and enforced in accordance with
the laws of the State of Arizona. Borrower(s) consent(s) to jurisdiction and
venue in the state and federal courts within the State of Arizona.

 

BORROWER(S) ADDRESS:     BORROWER(S):                 (Name of Individual)      
            (Name of additional Individual)           (Name of additional
Individual)           (Name of additional Individual)

(Execute Original Only)

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ARIZONA SAMPLE (MVC)

WHEN RECORDED, MAIL TO:

First American Title Insurance Company

4801 E. Washington

Phoenix, AZ 85034

HOLD FOR PICKUP

TRUST DEED

With Assignment of Rents

THIS TRUST DEED, made this          day of             ,20         between
                                        
                                                 , whether one or more, as
TRUSTOR, whose address is                                          
                                        c/o Marriott Resorts Hospitality
Corporation, P. O. Box 890, Lakeland, Florida 33802 and First American Title
Insurance Company, 4801 East Washington, Phoenix, AZ 85034, as TRUSTEE, and
MARRIOTT OWNERSHIP RESORTS, INC., a Delaware Corporation, whose address is 1200
U.S. 98 South, Lakeland, Florida 33801, as BENEFICIARY.

WITNESSETH: That Trustor CONVEYS AND WARRANTS TO TRUSTEE IN TRUST, WITH POWER OF
SALE, the following described real property (herein the “Property”), lying
situate and being in Phoenix, Maricopa County, Arizona:

Ownership Interest(s):                 ,                 ,                 , and
                , in CANYON VILLAS OWNERSHIP PROGRAM (the “Program”) with either
Floating Time Rights for Platinum or Gold Use Periods or Fixed Time Rights for
Platinum Plus Use Periods, as applicable, consisting of the following:

I. For each Ownership Interest in the Program being conveyed herein, an
undivided interest (“Ownership Share”) in the Land described in Exhibit “A”
attached hereto and by this reference made a part hereof and the Improvements
constructed or to be constructed thereon from time to time (collectively, the
Land and Improvements are the “Property”), as tenants in common with the holders
of other Ownership Shares in the Property under the Canyon Villas Vacation
Ownership Program Declaration of Covenants, Conditions and Restrictions dated
June 19, 2001, recorded in Maricopa County, Arizona Recorder’s Office as
Document No. 2001-0534924 , as amended from time to time (“Program
Declaration”). The Ownership Share(s) included in the Ownership Interest(s)
conveyed herein is calculated pursuant to Exhibit “C” of the Program Declaration
and is subject to adjustment in accordance with the Program Declaration as
additional Units are added to the Program, as shown in Notices recorded from
time to time by Beneficiary.

II. The exclusive right to reserve and then use and occupy a Unit of the 2
bedroom Unit Type on an                  Year          Rights basis, in
accordance with, and subject to, the Program Declaration, together with the
right in common with other owners to use and enjoy the Property during the Use
Period assigned to each Ownership Interest identified above.

III. Membership in the Canyon Villas Vacation Owners Association
(“Association”).

TOGETHER WITH all of the rights, title privileges, easements, and common areas
and facilities appertaining to the above described Ownership Interest(s), as set
forth in the Declaration;

TOGETHER WITH all and singular the rights, members, hereditaments and
appurtenances to the said property belonging or in any way incidental or
appertaining;

TOGETHER WITH all fixtures and improvements now or hereafter located thereon and
all water rights, rights of way, easements, rents, issues, profits, income,
tenements, hereditaments, privileges and appurtenances thereunto belonging, now
or hereafter used or enjoyed with the Property, or any part thereof, SUBJECT,
HOWEVER, to the right, power and authority hereinafter given to and conferred
upon Beneficiary to collect and apply such rents, issues, and profits;

FOR THE PURPOSE OF SECURING (1) payment of the indebtedness evidenced by a
promissory note, in the principal sum of $                , made by Trustor,
payable to the order of the Beneficiary at the times, in the manner and with
interest as therein set forth, and any extensions and/or renewals or
modifications thereof (herein the “Note”); (2) the performance of each agreement
of Trustor herein contained; (3) the payment of such additional loans or
advances (herein “Future Advances”) as hereafter may be made to Trustor, or his
successors or assigns, when evidenced by a promissory note or notes reciting
that they are secured by this Trust Deed; and (4) the payment of all sums
expended or advanced by Beneficiary under or pursuant to the terms hereof,
together with interest thereon as herein provided.

Trustor covenants that Trustor is lawfully seized of the estate hereby conveyed
and has the right to mortgage, grant and convey the Ownership Interest(s), that
the Ownership Interest(s) are unencumbered, and that Trustor will warrant and
defend generally the title to the Ownership Interest(s) against all claims and
demands, subject to any declarations, easements or restrictions listed in a
schedule of exceptions to coverage in any title insurance policy insuring
Beneficiary’s interest in the Ownership Interest(s).

Trustor shall promptly pay when due the principal of and interest on the
indebtedness evidenced by the Note, late charges as provided in the Note,
reasonable service charges imposed by Beneficiary for servicing the loan
account, as provided in the Note, and the principal of and interest on any
Future Advances secured by this Trust Deed.

TO PROTECT THE SECURITY OF THIS TRUST DEED, TRUSTOR AGREES:

1. Trustor’s Obligations Concerning Property. To keep the Property in good
condition and repair; not to remove or demolish any building thereon, to restore
promptly and in good and workmanlike manner any building thereon which may be
damaged

 

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or destroyed; to comply with all laws, covenants and restrictions affecting the
Property; not to commit or permit waste thereof; not to commit, suffer or permit
any act upon the Property in violation of law; to do all other acts which from
the character or use of the Property may be reasonably necessary, including
complying with the provisions of the Program Declaration, Articles of
Incorporation, the By-Laws and Canyon Villas Vacation Ownership Program Rules,
and all other documents pertaining to the Property or the Association.

Trustee, upon presentation to it of an affidavit signed by Beneficiary, setting
forth facts showing a default by Trustor under this numbered paragraph, is
authorized to accept as true and conclusive all facts and statements therein,
and to act thereon hereunder.

2. Insurance. To take such actions as may be reasonable to insure that the
Association each provides and maintains insurance of such types and amounts as
the Declaration may require, covering the improvements now existing or hereafter
erected or placed on the Property. Such insurance shall be carried in companies
approved by Beneficiary, with loss payable clauses in favor of and in form
acceptable to Beneficiary. In event of loss, Trustor shall give immediate notice
to Beneficiary, who may make proof of loss, and each insurance company concerned
is hereby authorized and directed to make payment for such loss directly to
Beneficiary instead of Trustor and Beneficiary jointly. The insurance proceeds,
if required by the Declaration or vote of the unit owners, shall be applied by
Beneficiary to the restoration or repair of the property damaged.

To the extent such insurance proceeds exceed the cost of such restoration or
repair and the Board of Trustees of the Condominium Association decides to
disburse such excess, Trustor’s share of such excess shall be applied to the
sums secured hereby, with the excess, if any, paid to Trustor. Unless
Beneficiary and Trustor otherwise agree in writing, any such application of
proceeds to principal shall not postpone the due dates of the monthly
installments payable by Trustor hereunder, nor change the amount of such
installments. If under the provisions of this Trust Deed, the Property is
acquired by Beneficiary, all right, title and interest of Trustor in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to
Beneficiary to the extent of the sums secured by this Trust Deed immediately
prior to such sale or acquisition.

3. Evidence of Title. To deliver to, pay for and maintain with Beneficiary until
the indebtedness secured hereby is paid in full, such evidence of title as
Beneficiary may require including a policy of title insurance.

4. Trustor to Defend Title. To appear in and defend any action or proceeding
purporting to affect the security hereof, the title to the Ownership
Interest(s), or the rights or powers of Beneficiary or Trustee; and should
Beneficiary or Trustee elect also to appear in or defend any such action or
proceeding, to pay all costs and expenses including cost of evidence of title
and attorney’s fees in a reasonable sum incurred by Beneficiary or Trustee.

5. Basic Charges; Special Charges; Personal Charges; Encumbrances; Fees.

(a) To pay at least 10 days before delinquency all Basic Charges, Special
Charges and Personal Charges (as those terms are defined in the Declaration)
affecting the Ownership Interest(s) arising under the Declaration (collectively
the “Charges”); to pay, when due, all encumbrances, charges, and liens with
interest, on the Property or any part thereof, which at any time appear to be
prior or superior hereto; to pay all costs, fees, and expenses of this Trust.

(b) Subject to applicable law, upon written request by Beneficiary to Trustor,
Trustor shall pay to Beneficiary on the day when monthly installments of
principal and interest are payable under the Note, until the Note is paid in
full, a sum (herein “Funds”) equal to one-twelfth of the annual Basic and
Special Charges affecting the Ownership Interest(s) due under the Declaration,
or such other amounts or for such other periods other than monthly, e.g.
quarterly, etc., all as reasonably estimated initially and from time to time by
Beneficiary on the basis of bills and reasonable estimates thereof.

(c) If Beneficiary exercises the right set forth in b) above, the Funds shall be
held in an institution the deposits or accounts of which are insured or
guaranteed by a Federal or State agency. Beneficiary shall apply the Funds, upon
receipt of the appropriate bill or bills, to pay said taxes and Common
Assessments. Beneficiary may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said Common Assessments and
bills, unless Beneficiary pays to Trustor interest on the Funds and applicable
law permits Beneficiary to make such a charge. Unless applicable law requires,
and except as provided above, Beneficiary shall not be required to pay Trustor
any interest on the Funds. Beneficiary shall give to Trustor, without charge, an
annual accounting of the Funds showing credits and debits to the Funds and the
purposes for which each debit to the Funds was made. The Funds are hereby
pledged as additional security for the sums secured by this Trust Deed.

(d) If the amount of the Funds held by Beneficiary, together with the future
monthly installments of Funds payable prior to the due dates of Basic and
Special Charges, shall exceed the amount required to pay such Basic and Special
Charges as they fall due, such excess shall be, at Trustor’s option, either
promptly repaid to Trustor or credited to Trustor on future monthly installments
of Funds. If the amount of the Funds held by Beneficiary shall not be sufficient
to pay Basic and Special Charges as they fall due, Trustor shall pay to
Beneficiary any amount necessary to make up the deficiency within thirty
(30) days from the date of a notice mailed by Beneficiary to Trustor requesting
payment thereof, but in no event shall Beneficiary require payment in advance
for Basic and Special Charges to be held and disbursed as set forth hereunder in
an amount which exceeds the estimate of the next year’s amount for same.

(e) Upon payment in full of all sums secured by this Trust Deed, Beneficiary
shall promptly refund to Trustor any Funds held by Beneficiary. If in the
exercise of Beneficiary’s remedies under this Trust Deed, the Ownership
Interest(s) are sold or the Ownership Interest(s) are otherwise acquired by
Beneficiary, Beneficiary shall apply, no later than immediately prior to the
sale of the Property or its acquisition by Beneficiary, any Funds then held by
Beneficiary as a credit against the sums secured by this Trust Deed.

6. Protection of Security of Trust Deed. Should Trustor fail to make any payment
or to do any act as herein provided, then Beneficiary or Trustee, but without
obligation so to do and without notice to or demand upon Trustor and without
releasing Trustor from any obligation hereof, may (i) make or do the same in
such manner and to such extent as either may deem necessary to protect the
security hereof, Beneficiary or Trustee being authorized to enter upon the
Property for such purposes; (ii) commence, appear in and defend any action or
proceeding purporting to affect the security hereof or the rights or powers of
Beneficiary or Trustee; (iii) pay, purchase, contest, or compromise any
encumbrance, charge or lien which in the judgment of either

 

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appears to be prior or superior hereto; and (iv) in exercising any such powers,
incur any liability, expend whatever amounts in its absolute discretion it may
deem necessary therefor, including cost of evidence of title, employ counsel,
and pay his reasonable fees. Trustor agrees to pay immediately and without
demand all sums expended hereunder by Beneficiary or Trustee, with interest from
date of expenditure at the rate payable from time to time on outstanding
principal under the Note until paid, and the repayment thereof shall be secured
hereby.

7. Right of Entry. To permit Beneficiary to make or cause to be made reasonable
entries upon and inspections of the Property, provided that Beneficiary shall
give Trustor notice prior to any such inspection, specifying reasonable cause.

IT IS MUTUALLY AGREED THAT:

8. Condemnation Awards and Insurance Proceeds. Should the Property or any part
thereof be taken or damaged by reason of any public improvement or condemnation
proceeding, or damaged by fire, or earthquake, or in any other manner,
Beneficiary shall be entitled to Trustor’s and/or the Ownership Interest(s)’
share of all compensation, awards, and other payments or relief therefor, and
shall be entitled at its option to commence, appear in and prosecute in its own
name, any action or proceedings, or to make any compromise or settlement, in
connection with such taking or damage. Trustor’s and/or the Ownership Interest’s
share of all such compensation, awards, damages, rights of action and proceeds,
including the proceeds of any policies of fire and other insurance affecting the
Property, are hereby assigned to Beneficiary, who may, after deducting therefrom
all its expenses, including attorney’s fees, apply the same on any indebtedness
secured hereby. Trustor agrees to execute such further assignments of any
compensation, award, damages, and rights of action and proceeds as Beneficiary
or Trustee may require. Unless Beneficiary and Trustor otherwise agree in
writing, any application of proceeds to the indebtedness secured hereby shall
not postpone the due date of the monthly installments payable under the terms of
the Note or pursuant to Paragraph 5 hereof, nor change the amount of such
installments.

9. Actions by Trustee. At any time and from time to time upon written request of
Beneficiary, payment of its fees and presentation of this Trust Deed and the
Note for endorsement (in case of full reconveyance, for cancellation and
retention), without affecting the liability of any person for the payment of the
indebtedness secured hereby, Trustee may (a) consent to the making of any map or
plat of the Property; (b) join in granting any easement or creating any
restriction thereon; (c) join in any subordination or other agreement affecting
this Trust Deed or the lien or charge thereof; (d) reconvey, without warranty,
all or any part of the Ownership Interest(s). The grantee in any reconveyance
may be described as “the person or persons entitled thereto”, and the recitals
therein of any matters or facts shall be conclusive proof of the truthfulness
thereof. Trustor agrees to pay reasonable Trustee’s fees for any of the services
mentioned in this paragraph.

10. Conditional Assignment of Rents. As additional security, Trustor hereby
assigns to Beneficiary, during the continuance of these trusts, all rents,
issues, royalties, and profits of the Ownership Interest(s) affected by this
Trust Deed and of any personal property located thereon. Until Trustor shall
default in the payment of any indebtedness secured hereby or in the performance
of any agreement hereunder, Trustor shall have the right to collect all such
rents, issues, royalties, and profits earned prior to default as they become due
and payable. From and after any such default by Trustor, Trustor’s right to
collect any of such sums shall cease, and Beneficiary shall have the right, with
or without taking possession of the Ownership Interest(s), to collect all rents,
royalties, issues, and profits. Failure or discontinuance of Beneficiary at any
time or from time to time to collect any such sums shall not in any manner
affect the subsequent enforcement by Beneficiary of the right, power, and
authority to collect the same. Nothing contained herein, nor the exercise of the
right by Beneficiary to collect, shall be, or be construed to be, an affirmation
by Beneficiary of any tenancy, lease or option, nor an assumption of liability
under, nor a subordination of the lien or charge of this Trust Deed to, any such
tenancy, lease or option.

11. Receiver. Upon any default by Trustor hereunder, Beneficiary may at any time
without notice, either in person, by agent, or by a receiver to be appointed by
a court (Trustor hereby consenting to the appointment of Beneficiary as such
receiver), and without regard to the adequacy of any security for the
indebtedness hereby secured, enter upon and take possession of the Ownership
Interest(s) or any part thereof, in its own name sue for or otherwise collect
any rents, issues, and profits, including those past due and unpaid, and apply
the same, less costs and expenses of operation and collection, including
reasonable attorney’s fees, upon any indebtedness secured hereby, and in such
order as Beneficiary may determine. Beneficiary shall be liable to account to
Trustor only for those rents actually received.

12. Exercise of Rights by Beneficiary Shall Not Constitute a Cure. The entering
upon and taking possession of the Ownership Interest(s), the collection of such
rents, issues, and profits, or the proceeds of fire and other insurance
policies, or compensation or awards for any taking of or damage to the Property
and the application or release thereof as aforesaid, shall not cure or waive any
default or notice of default hereunder or invalidate any act done pursuant to
such notice.

13. Notice of Sale. The Trustor requests that a copy of any notice of sale
hereunder be mailed to him at the address hereinbefore set forth.

14. Trustor’s Default. Time is of the essence hereof. Upon default by Trustor in
the payment of any indebtedness secured hereby or in the performance of any
agreement hereunder, Beneficiary, prior to acceleration of the debt, shall mail
notice to Trustor as provided in paragraph 23 hereof, specifying: (i) the
breach; (ii) the action required to cure such breach; (iii) a date, not less
than fifteen (15) days from the date the notice is mailed to Trustor by which
such breach must be cured; and (iv) that failure to cure such breach on or
before the date specified in the notice may result in acceleration of the sums
secured by this Trust Deed and sale of the Property by the Trustee or at
foreclosure by judicial proceeding. If the breach is not cured on or before the
date specified in the notice, Beneficiary, at Beneficiary’s option, may declare,
without further demand, all of the sums secured by this Trust Deed to be
immediately due and payable and may either direct the Trustee to sell the
Property or foreclose this Trust Deed by judicial proceedings. Beneficiary shall
be entitled to collect all expenses of collection, including, but not limited
to, attorney’s fees, whether or not action be instituted hereon, court costs,
and costs of documentary evidence, abstracts and title reports. As used in this
Trust Deed and in the Note, “attorney’s fees” shall include attorney’s fees, if
any, which may be awarded by an appellate court.

15. Power of Sale. In the event of such default and acceleration of the debt,
Beneficiary may execute or cause Trustee to execute a written notice of default
and of election to cause the Property to be sold to satisfy the obligations
hereof, and Trustee shall

 

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file such notice for record in each county wherein the Property is situated.
Beneficiary also shall deposit with Trustee, the Note and all documents
evidencing expenditures secured hereby. After the lapse of such time as may then
be required by law following the recordation of said notice of default, and
notice of default and notice of sale having been given as then required by law;
Trustee, without demand on Trustor, shall sell the Ownership Interest(s) on the
date and at the time and place designated in the notice of sale, either as a
whole or in separate parcels, and in such order as it may determine (but subject
to any statutory right of Trustor to direct the order in which such property, if
consisting of several known lots or parcels, shall be sold) at public auction to
the highest bidder, the purchase price payable in lawful money of the United
States at the time of sale. The person conducting the sale may, for any cause he
deems expedient, postpone the sale from time to time until it shall be completed
and, in every case, notice of postponement shall be given by public declaration
thereof by such person at the time and place last appointed for the sale.
Trustee shall execute and deliver to the purchaser its Deed conveying the
Property so sold, but without any covenant or warranty, express or implied. The
recitals in the Deed of any matters or facts shall be conclusive proof of the
truthfulness thereof. Any person, including Beneficiary, may bid at the sale.
Trustee shall apply the proceeds of the sale to the payment of (1) the costs and
expenses of exercising the power of sale and of the sale, including the payment
of the Trustee’s and attorney’s fees (including any which may be awarded by an
appellate court); (2) cost of any evidence of title procured in connection with
such sale and revenue stamps, if any, on the Trustee’s Deed; (3) all sums
expended under the terms hereof, not then repaid, with accrued interest from
date of expenditure at the rate payable from time to time on outstanding
principal under the Note; (4) all other sums then secured hereby; and (5) the
remainder, if any, to the person or persons legally entitled thereto, or as
provided in A.R.S. § 33-812.

16. Judicial Foreclosure. Upon the occurrence of any default hereunder,
Beneficiary shall have the option to declare all sums secured hereby immediately
due and payable, sue on the Note and/or foreclose this Trust Deed in the manner
provided by law for the foreclosure of mortgages on real property and
Beneficiary shall be entitled to recover in such proceeding all costs and
expenses incident thereto, including an attorney’s fee in such amount as shall
be fixed by the court (including any which may be awarded by an appellate
court).

17. Successor Trustee. Beneficiary may appoint a successor trustee at any time
by filing for record in the office of the County Recorder of the county in which
the Property is situated, a substitution of trustee. From the time the
substitution is filed for record, the new trustee shall succeed to all the
powers, duties, authority and title of the trustee named herein or of any
successor trustee. Each such substitution shall be executed and acknowledged,
and notice thereof shall be given and proof thereof made, in the manner provided
by law.

18. Acceptance of Trust. Trustee accepts this Trust when this Trust Deed, duly
executed and acknowledged, is made a public record as provided by law. Trustee
is not obligated to notify any party hereto of pending sale under any other
Trust Deed or of any action or proceeding in which Trustor, Beneficiary, or
Trustee shall be a party, unless brought by Trustee.

19. Parties. This Trust Deed shall apply to, insure to the benefit of, and bind
all parties hereto, their heirs, legatees, devisees, administrators, executors,
successors and assigns. All obligations of Trustor hereunder are joint and
several. The term “Beneficiary” shall mean the owner and holder, including any
pledgee, of the note secured hereby. In this Trust Deed, whenever the context
requires, the masculine gender includes the feminine and/or neuter, and the
singular number includes the plural.

20. Application of Payments. Unless applicable law provides otherwise, all
payments received by Beneficiary from or on behalf of Trustor, other than
payments made specifically for the purpose set forth in paragraph 5 hereof,
shall be applied by Beneficiary first in payment of amounts payable to
Beneficiary by Trustor under paragraph 5 hereof, if any, then against advances,
if any, made by Beneficiary pursuant to paragraph 6 of this Trust Deed, then to
costs, fees, expenses and other amounts incurred and advanced by the Beneficiary
in the enforcement of its rights under the Note and this Trust Deed, including
without limitation, costs and reasonable attorneys’ fees, then to unpaid service
fees, then to interest payable on the Note, then to the principal of the Note,
then to unpaid late charges, if any, then to interest on any Future Advances
made at Beneficiary’s option pursuant to paragraph 24 hereof, then to the
principal of Future Advances, if any, made at Beneficiary’s option pursuant to
paragraph 24 hereof.

21. Acceleration upon Sale. If all or any part of the Property or an interest
therein is sold (or leased with an option to purchase) or transferred by Trustor
without Beneficiary’s prior written consent, excluding (a) a transfer by devise,
descent or by operation of law upon the death of a joint tenant, or (b) the
creation of a lien or encumbrance subordinate to this Trust Deed, Beneficiary
may, at Beneficiary’s option, declare all the sums secured by this Trust Deed to
be immediately due and payable. Beneficiary shall have waived such option to
accelerate if, and only if, prior to the sale (or lease with option to purchase)
or transfer, Beneficiary and the person to whom the Property is to be sold (or
leased) or transferred reach agreement in writing that the credit of such person
is satisfactory to Beneficiary and that the interest payable on the sums secured
by this Trust Deed shall be at such rate as Beneficiary shall request. If
Beneficiary has waived the option to accelerate as herein provided, and if
Trustor’s successor in interest has executed a written assumption agreement
accepted in writing by Beneficiary, Beneficiary shall release Trustor from all
obligations under this Trust Deed and the Note. If Beneficiary exercises such
option to accelerate, Beneficiary shall mail Trustor notice of acceleration.
Such notice shall provide a period of not less than fifteen (15) days from the
date the notice is mailed within which Trustor may pay the sums declared due. If
Trustor fails to pay such sums prior to the expiration of such period,
Beneficiary may, without further notice or demand on Trustor, invoke any
remedies provided in this Trust Deed or by law.

22. No Waiver; Remedies Cumulative. Any forbearance by Beneficiary in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy in the
future, and the waiver of Beneficiary of any default shall not constitute a
waiver of any other or subsequent default. The procurement of insurance or the
payment of taxes or other liens, charges or assessments by Beneficiary shall not
be a waiver of Beneficiary’s right to accelerate the maturity of the
indebtedness secured by this Trust Deed. All remedies provided in this Trust
Deed are distinct and cumulative to any other right or remedy under this Trust
Deed or afforded by law or equity, and may be exercised concurrently,
independently or successively.

23. Notices. Except for any notice required under applicable law or under the
Note to be given in another manner, (a) any notice to Trustor provided for in
this Trust Deed shall be given by mailing such notice by U.S. Mail, postage
prepaid (or such other more expeditious method as may be appropriate in the case
of foreign addresses, as Beneficiary may choose in its discretion), addressed to
Trustor at the Trustor’s address as set forth herein or in the Note, or at such
other address as Trustor may designate by

 

466492v3 (9.1.09)   Page 4 of 7  

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notice to Beneficiary as provided herein, and (b) any notice to Beneficiary
shall be given by certified mail, return receipt requested, (or in the case of a
notice originating in a foreign country, by such other method that results in
the Beneficiary acknowledging in writing, receipt of the notice), to
Beneficiary’s address stated herein or to such other address as Beneficiary may
designate by notice to Trustor as provided herein. Any notice provided for in
this Trust Deed shall be deemed to have been given to Trustor or Beneficiary
when given in the manner designated herein.

24. Future Advances. Upon request by Trustor, Beneficiary, at Beneficiary’s
option, may make additional loans to Trustor. Such additional loans (“Future
Advances”), with interest thereon, shall be secured by this Trust Deed when
evidenced by promissory notes stating that said notes are secured hereby.

25. Abandonment; Amendments to Condominium Documents. Trustor shall not, except
after notice to Beneficiary and with Beneficiary’s prior written consent, either
partition or subdivide the Property or consent to:

(i) The abandonment or termination of the Program or Program Declaration, except
for abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of taking by condemnation
or eminent domain;

(ii) Any amendment to any provision of the Program Declaration, or the Articles
of Incorporation, By-Laws or Rules and Regulations of the Association, or
equivalent constituent documents of the Program, which is for the express
benefit of Beneficiary.

26. Provisions Severable. This Trust Deed shall be construed according to the
laws of the State of Arizona. In the event that any provision or clause of this
Trust Deed or the Note conflicts with applicable law, such conflict shall not
affect other provisions of this Trust Deed or the Note which can be given effect
without the conflicting provision. To this end the provisions of the Trust Deed
and the Note are declared to be severable.

 

466492v3 (9.1.09)   Page 5 of 7  

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IN WITNESS WHEREOF, Trustor has executed this Trust Deed on the day and year
first written above.

Upon closing of the purchase to which this Trust Deed applies, the undersigned
hereby authorize(s) closing agent to complete this Trust Deed by inserting the
appropriate date of the Trust Deed and to complete, as necessary, the recording
information relating to the documents by which the Ownership Interest(s) being
encumbered by this Trust Deed was created.

_______________________________

Trustor

_______________________________

Trustor

_______________________________

Trustor

_______________________________

Trustor

STATE OF                             

                                         ss.

COUNTY OF                         

On                         , personally appeared before me
                                                                  the signer(s)
of the above instrument, who duly acknowledged to me that he/she/they executed
the same.

   Printed Name of Notary:______________________ Notary Public, State
of_______________________ Commission No:______________________
Expiration:_____________________________

 

466492v3 (9.1.09)

   Page 6 of 7   

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EXHIBIT “A”

Lot 16, of DESERT RIDGE SUPERBLOCK 7/4 PHASE I, according to the plat of record
in the Office of the County Recorder of Maricopa County, Arizona, recorded in
Book 383 of Maps, Page 1 and the Certificate of Correction recorded February 3,
1995 in 95-0064178 of Official Records.

EXCEPTING therefrom all gas, oil, metals and mineral rights as reserved in
Patent No. 53-52417-02, recorded September 15, 1994 in 94-0680372, of Official
Records and as reserved in Patent No. 53-52417-01, recorded May 20, 1997 in
97-0336125, of Official Records.

For posting purposes, the Ownership Interest No(s) conveyed by the Deed shall be
shown as Lot                              in Book 12 of Maps, page 91.

 

466492v3 (9.1.09)

   Page 7 of 7   

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CALIFORNIA SAMPLE (MVC)

“TO BE DATED AT CLOSING BY CLOSING AGENT”

NOTE SECURED BY DEED OF TRUST<

 

Deed of Trust No:                                             Timeshare Interest
No(s):             Recorded:                                          
               US $                                                Closing Date:
                                

FOR VALUE RECEIVED, the undersigned                          (“Borrower(s)”)
promise(s) to pay MARRIOTT OWNERSHIP RESORTS, INC., (said party or any other
party to whom Marriott Ownership Resorts, Inc. may transfer and assign this
Note, and who holds this Note from time to time is hereinafter referred to as
“Holder”), Post Office Box 8038, Lakeland, Florida 33802, or order, the
principal sum of «             Dollars (US $             ), with interest on the
unpaid balance from the date (the “closing date”) of this Note, until paid, on
which the escrow for the purchase of the Timeshare Interest(s) described in the
recorded deed of trust (the “Deed of Trust”) securing this Note closes, at the
rate of              percent (            %) per annum, [based on a 360 day year
and on the actual number of days elapsed]. Principal and interest shall be
payable in lawful money of the U.S. at the Holder’s address set forth above, or
such other place as the Holder may, from time to time, designate, in consecutive
monthly installments of              Dollars (US $            ), on the
             day of each month and continuing thereafter on the same day of each
month for a period of              months commencing on
                            , with the remaining unpaid principal balance,
together with accrued interest thereon, due and payable, if not sooner paid, on
                        .

The indebtedness evidenced by this Note is secured by a Deed of Trust, of even
date herewith, to First American Title Insurance Company, 3625 Fourteenth
Street, Riverside, CA 92502, as trustee. Reference is made to said Deed of Trust
for rights as to acceleration of the indebtedness evidenced by this Note, and
for other remedies in the event of default.

Each monthly payment shall be tendered with a                      service fee
or such other reasonable service fee as the holder of this Note shall determine
from time to time by written notice to Borrower(s).

Borrower(s) shall pay to the Holder a late charge of (i) six percent (6%) for
any monthly installment not received by the Holder within ten (10) days after
the date the installment is due or $5.00, whichever is greater, and (ii) a
returned check charge of $15.00 for each occurrence in the event Borrower(s)
shall pay any installment by personal check returned to the Holder hereof for
any reason. A late charge will be deducted from the next payment received.

Each payment shall be credited first on service fees, then on any returned check
charges, if any, then on unpaid late charges, if any, then on interest due, and
the remainder on principal.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Presentment, notice of dishonor, and protest are hereby waived by all makers,
sureties, guarantors and endorsers hereof. This Note shall be the joint and
several obligation of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

1. Failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to the
Borrower(s);

2. The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against the Borrower(s);

3. The sale (or lease with option to purchase) or transfer of all or any part of
the Property or any interest therein without the prior written consent of the
Holder, excluding a transfer by devise, descent or by operation of law upon the
death of a joint tenant therein or grant of any leasehold interest of three
(3) years or less not containing an option to purchase;

4. Failure of Borrower(s) to comply with the covenants of the Deed of Trust;

5. Failure of Borrower(s) to comply with the requirements of the Declarations,
Articles of Incorporation, By-Laws and Rules and Regulations governing the
Property securing payment hereof.

The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance.

If this Note is not paid when due, whether at maturity or by acceleration, the
Holder shall be entitled to collect all reasonable costs and expenses of
collection, including, but not limited to, reasonable attorney’s fees, whether
or not action be instituted hereon.

Any notice to Borrower(s), request, demand, instruction or other document
provided for in this Note shall be deemed to have been given after depositing
same in any U.S. post office box, postage prepaid, addressed to Borrower(s) at
the address stated below, or to such other address as Borrower(s) may designate
by written notice to the Holder. Any Notice to the Holder shall be given by
mailing such notice by certified mail, return receipt requested, to the Holder
at the address stated in the first paragraph of this Note, or at such other
address as may have been designated by written Notice to Borrower(s). Any notice
provided for in this Note shall be deemed to have been given to Borrower(s) or
the Holder when given in the manner herein designated.

 

BORROWER(S)’ ADDRESS:        Borrower   Borrower   Borrower   Borrower  
Borrower

--------------------------------------------------------------------------------

CALIFORNIA SAMPLE (MVC)

Order No.

Escrow No.

Loan No.

RECORDING REQUESTED BY:

WHEN RECORDED MAIL TO:

MARRIOTT OWNERSHIP RESORTS, INC.

ATTN: NEW OWNER ADMINISTRATION

P.O. Box 24747

LAKELAND, FL 33802

 

 

Space Above for Recorder’s Use            

UPON CLOSE OF ESCROW OF THE PURCHASE TO WHICH THIS DEED OF TRUST APPLIES,
TRUSTOR(S) HEREBY AUTHORIZE(S) ESCROW HOLDER/CLOSING AGENT OR HOLDER OF THE NOTE
TO COMPLETE THIS DEED OF TRUST AND THE NOTE AS PROVIDED FOR IN THE CONTRACT FOR
PURCHASE PURSUANT TO WHICH THE TIMESHARE INTEREST(S) WERE ACQUIRED BY
TRUSTOR(S).

DEED OF TRUST WITH ASSIGNMENT OF RENTS

(SHORT FORM)

This DEED OF TRUST, made                      20         between
                                                 ,
                                                 , herein called TRUSTOR, whose
address is                                                              , FIRST
AMERICAN TITLE INSURANCE COMPANY, a California corporation, herein called
TRUSTEE, and MARRIOTT OWNERSHIP RESORTS, INC., a Delaware corporation, herein
called BENEFICIARY.

WITNESSETH: That Trustor grants to Trustee in Trust, with Power of Sale, that
property in the City of Palm Desert, County of Riverside, State of California,
described as:

(SEE ATTACHED EXHIBIT A)

(Ref:                 )

Together with the rents, issues and profits thereof, subject, however, to the
right, power and authority hereinafter given to and conferred upon Beneficiary
to collect and apply such rents, issues and profits. For the Purpose of Securing
(1) payment of the sum of $                     with interest thereon according
to the terms of a promissory note or notes of even date herewith made by
Trustor, payable to order of Beneficiary, and extensions or renewals thereof,
and (2) the performance of each agreement of Trustor incorporated by reference
or contained herein (3) Payment of additional sums and interest thereon which
may hereafter be loaned to Trustor, or his successors or assigns, when evidenced
by a promissory note or notes reciting that they are secured by this Deed of
Trust.

To protect the security of this Deed of Trust, and with respect to the property
above described, Trustor expressly makes each and all of the agreements, and
adopts and agrees to perform and be bound by each and all of the terms and
provisions set forth in subdivision A, and it is mutually agreed that each and
all of the terms and provisions set forth in subdivision B of the fictitious
deed of trust recorded in Orange County August 17, 1964, and in all other
counties August 18, 1964, in the book and at the page of Official Records in the
office of the county recorder of the county where said property is located,
noted below opposite the name of such county, namely:

 

COUNTY

   BOOK    PAGE    COUNTY    BOOK    PAGE    COUNTY    BOOK    PAGE    COUNTY   
BOOK    PAGE

Alameda

   1288    556    Kings    858    713    Placer    1028    379    Sierra    38
   187

Alpine

   3    130-31    Lake    437    110    Plumas    166    1307    Siskiyou    506
   762

Amador

   133    438    Lassen    192    367    Riverside    3778    347    Solano   
1287    621

Butte

   1330    513    Los Angeles    T-3878    874    Sacramento    5039    124   
Sonoma    2067    427

Calaveras

   185    338    Madera    911    136    San
Benito    300    405    Stanislau    1970    56

Colusa

   323    391    Marin    1849    122    San Bernardino    6213    768    Sutter
   655    585

Contra Costa

   4684    1    Mariposa    90    453    San
Francisco    A-804    596    Tehama    457    183

--------------------------------------------------------------------------------

Del Norte

   101    549    Mendocino    667    99    San Joaquin    2855    283    Trinity
   108    595

El Dorado

   704    635    Merced    1660    753    San Luis Obispo    1311    137   
Tulare    2530    108

Fresno

   5052    623    Modoc    191    93    San Mateo    4778    175    Tuolumne   
177    160

Glenn

   469    76    Mono    69    302    Santa Barbara    2065    881    Ventura   
2607    237

Humboldt

   801    83    Monterey    357    239    Santa Clara    6626    664    Yolo   
769    16

Imperial

   1189    701    Napa    704    742    Santa Cruz    1638    607    Yuba    398
   693

Inyo

   165    672    Nevada    363    94    Shasta    800    633         

Kern

   3756    690    Orange    7182    18    San Diego    SERIES 5 BOOK 1964, Page
144974      

shall inure to and bind the parties hereto, with respect to the property above
described. Said agreements, terms and provisions contained in said subdivision A
and B, (identical in all counties, and printed on the attached) are by the
within reference thereto, incorporated herein and made a part of this Deed of
Trust for all purposes as fully as if set forth at length herein, and
Beneficiary may charge for a statement regarding the obligation secured hereby,
provided the charge therefore does not exceed the maximum allowed by law.

The undersigned Trustor(s), requests that a copy of any notice of default and
any notice of sale hereunder be mailed to him/her/it at the address hereinbefore
set forth.

 

Signature of Trustor(s)            

ACKNOWLEDGMENT

(For Use In California Only)

STATE OF                     

COUNTY OF                 

On             before me,                                             , a notary
public, personally appeared_____________________________________
                                         
                                         
                                         
                                         
                                                             ,

who proved to me on the basis of satisfactory evidence to be the person(s) whose
name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or entity upon
behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California
that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

 

Signature      

(Seal)

--------------------------------------------------------------------------------

COLORADO SAMPLE (MVC)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable dates for commencement of payments due hereunder, the monthly payment
date and the final payment date. DO NOT DESTROY THIS NOTE. When paid, this Note,
with the Deed of Trust securing the same, must be surrendered to the Trustee for
cancellation before release will be made.

PROMISSORY NOTE

Reference No.                         

Mountain Valley Lodge          

 

US $            

                                        , 19        

FOR VALUE RECEIVED, the undersigned                                     
(“Borrower(s)”) promise(s) to pay to the order of MARRIOTT OWNERSHIP RESORTS,
INC., (said party or any other party to whom this Note may be transferred and
assigned is hereinafter called the “Holder”), P.O. Box 8038, Lakeland, Florida
33802, or order, the principal sum of ____________________________________
                                                          No/100 U.S. Dollars
(US $            ) on the unpaid balance from the date of this Note, until paid,
at the rate of                      percent (            %) per annum. Interest
shall be calculated by applying the stated annual rate against the unpaid
principal for the actual number of days elapsed divided by a 360 day year.
Principal and interest shall be payable, without offset, in lawful money of the
United States at the Holder’s address set forth above, or such other place as
the Holder may, from time to time, designate, in
                                              consecutive monthly installments
of                                                                       No/100
U.S. Dollars (US $            ), beginning on the              day of
                    , 19         and continuing thereafter on the same day of
each month, with the remaining unpaid balance, together with accrued interest
thereon, due and payable, if not sooner paid, on
                                                         . The indebtedness
evidenced by this Note is secured by a Deed of Trust, dated of even date
herewith, creating a lien on the real property described therein (the
“Property”), located in the Town of Breckenridge, Summit County, Colorado.
Reference is made to said Deed of Trust for rights of the Holder upon
acceleration of the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a $4.00 service fee. If any monthly
installment is not received by the Holder within ten (10) days after the date
the installment is due, Borrower(s) shall pay to the Holder a late charge of
five percent (5%) for any monthly installment not received by the Holder within
ten (10) days after the date the installment is due . The Holder may apply any
payment received by it to the payment of all late charges then owing before
application to interest or principal. Such late charge is in addition to and not
in lieu of or diminution of any other rights and remedies of the Holder of this
Note.

Each payment made by Borrower(s) shall be credited on account of amounts due in
the order specified in Paragraph 3 of the Purchase Money Deed of Trust.

The Principal balance may be prepaid, in whole or in part, at any time or from
time to time without a penalty. Any prepayment shall include interest to the
date it is made. Partial prepayments shall be applied to the installments in the
inverse order of their maturity. There will be no changes in the due date or in
the amount of the monthly payment unless the Holder agrees in writing to those
changes.

The makers, sureties, guarantors and endorsers hereof severally waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution. This Note shall be the joint and
several obligation of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their respective heirs, personal representatives,
successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

 

  a) Failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
twenty (20) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s);

 

  c) The sale (or lease with option to purchase) or transfer of all or any part
of the Property or any interest therein without the prior written consent of the
Holder, excluding a transfer by devise, descent or by operation of law upon the
death of a joint tenant therein; or

 

  d) Failure of Borrower(s) to comply with the covenants of the Deed of Trust
after notice and failure to cure as provided in the Deed of Trust.

The Holder may exercise its option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, attorney’s fees, whether or not action be instituted hereon.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given after mailing same by U.S. mail, postage prepaid (or such other more
expeditious method as may be appropriate in the case of foreign addresses, as
Holder may choose in its discretion), addressed to Borrower(s) at the address
stated below, or to such other address as Borrower(s) may designate by written
notice to the Holder. Any notice to the Holder shall be deemed to have been
given by mailing such notice by U.S. certified mail, return receipt requested,
(or in the case of a notice originating in a foreign country, by such other
method that results in the Holder acknowledging in writing receipt of the
notice), at 1200 U.S. 98 South, Lakeland, Florida 33802, or at such other
address as may be designated by written notice to Borrower(s).

This Note shall be governed by, construed under and enforced in accordance with
the laws of the State of Colorado. Borrower(s) consent(s) to jurisdiction and
venue in the state and federal courts within the State of Colorado.

 

      BORROWER(S) ADDRESS: Borrower               Borrower              
Borrower              

(Execute Original Only)

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COLORADO SAMPLE (MVC)

UPON CLOSING OF THE PURCHASE TO WHICH THIS PURCHASE MONEY DEED OF TRUST APPLIES,
THE UNDERSIGNED HEREBY AUTHORIZES CLOSING AGENT TO COMPLETE THIS PURCHASE MONEY
DEED OF TRUST BY INSERTING THE APPLICABLE DATES.

PURCHASE MONEY DEED OF TRUST

THIS DEED OF TRUST, made this                                 , by the
Grantor(s) «LEGAL_NAME» (“Borrower”), to the Public Trustee of Summit County,
Colorado (“Trustee”) for the benefit of the Beneficiary, MARRIOTT OWNERSHIP
RESORTS, INC., P.O.Box 8038, Lakeland, Florida 33802 (“Lender”).

WHEREAS, Borrower is indebted to Lender in the principal sum of «MTG_TXT» U.S.
Dollars (US $ «MTG_AMT» ), which indebtedness is evidenced by Borrower’s
Purchase Money Promissory Note of even date herewith (“Note”), providing for
equal monthly installments of principal and interest, with the balance of the
indebtedness, if not sooner paid, due and payable                         
months from the date hereof.

To secure the Lender (a) the repayment of the indebtedness evidenced by the
Note, with interest thereon, the payment of all other sums, with interest
thereon, advanced in accordance herewith to protect the security of this Deed of
Trust, and the performance of the covenants and agreements of Borrower herein
contained, and (b) the repayment of any future advances, with interest thereon,
made to Borrower by Lender pursuant to paragraph 20 hereof (“Future Advances”),
Borrower irrevocably grants and conveys to Trustee, in trust for the benefit of
Lender, with power of sale the following-described property located in the
County of Summit, State of Colorado:

 

Condominium    Resort Interest.    Designated    Designated

Unit No.

   No    Unit Type    Season

«MVDATA1»

        

Mountain Valley Lodge, a condominium, previously known as Hotel Breckenridge, a
condominium hotel, according to the Condominium Declaration for Hotel
Breckenridge, a condominium hotel, recorded June 30, 1992 at reception no.
424105, the First Supplemental Declaration of Condominium and Timeshare
Ownership for Mountain Valley Lodge, a condominium, recorded September 20, 1994
at reception no. 476347, the condominium map for Hotel Breckenridge recorded
June 30, 1992 at reception no. 424104 and any and all amendments, modifications
and supplements thereto County of Summit, State of Colorado

also known by street and number as a resort interest in Mountain Valley Lodge,
Breckenridge, Colorado

Borrower covenants that Borrower is lawfully seized of the estate hereby
conveyed and has the right to mortgage, grant and convey the Property, that the
Property is unencumbered, and that Borrower will warrant and defend generally
the title to the property against all claims and demands, subject to any
declaration, easements, or restrictions listed in a schedule of exceptions to
coverage in any title insurance policy insuring Lender’s interest in the
Property. Borrower further agrees and covenants to abide by the terms and
provisions attached hereto and incorporated herein by reference.

IN WITNESS WHEREOF, Borrower has executed this Deed of Trust.

 

          Borrower     Borrower           Borrower     Borrower

STATE OF                     )

              )ss.

COUNTY OF                 )

This foregoing instrument was acknowledged before me this
                             «LEGAL_NAME».

WITNESS my hand and this official seal.

 

   Notary Public My Commission expires:

 

11.08.94(MV.MORT.1)

   Page 1 of 4   

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ADDITIONAL COVENANTS AND TERMS

Borrower and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charge and Service Fees. Borrower shall
promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by the Deed of Trust.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower, Borrower shall pay to Lender on the day
when monthly installments of principal and interest are payable under the Note,
until the Note is paid in full, a sum (herein “Funds”) equal to one-twelfth of
Borrower’s share of the yearly taxes and assessments which may attain priority
over this Deed of Trust and one-twelfth of the annual maintenance fee or
assessment due under the applicable First Supplemental Declaration of
Condominium and Timeshare Ownership (herein “Condominium Assessments”), all as
reasonably estimated initially and from time to time by Lender on the basis of
assessments and bills and reasonable estimates thereof.

If lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, and Condominium
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower interest on the Funds and applicable law permits
Lender to make such a charge. Unless applicable law requires, Lender shall not
be required to pay Borrower any interest on earnings on the Funds. Lender shall
give to Borrower, without charge, an annual accounting of the Funds showing
credits and debits to the Funds and the purposes for which each debit to the
Funds was made. The Funds are hereby pledged as additional security for the sums
secured by this Deed of Trust.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Condominium Assessments shall exceed the amount required to pay such taxes,
assessments, and Condominium Assessments as they fall due, such excess shall be,
at Borrower’s option, either promptly repaid to Borrower or credited to Borrower
on monthly installments of Funds. If the amount of the Funds held by Lender
shall not be sufficient to pay taxes, assessments, and Condominium Assessments
as they fall due, Borrower shall pay to Lender any amount necessary to make up
the deficiency within thirty (30) days from the date of a notice mailed by
Lender to Borrower requesting payment thereof.

Upon payment in full of all sums secured by this Deed of Trust, Lender shall
promptly refund to Borrower any funds held by Lender. If under paragraph 18
hereof the Property is sold or the Property is otherwise acquired by Lender,
Lender shall apply, no later than immediately prior to the sale of the Property
or its acquisition by Lender, any Funds then held by Lender as a credit against
the sums secured by this Deed of Trust.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and paragraphs 1 and 2 hereof shall
be applied by Lender first to service fees, then to any returned check charges,
if any, then on unpaid late charges, if any, then on interest due, and the
remainder on principal.

4. Charges; Liens. Borrower shall promptly pay, when due, all Condominium and
Resort Owner Association Assessments imposed by the applicable Condominium or
Resort Owners Association pursuant to the provisions of the declarations,
bylaws, rules and regulations or other constituent documents applicable to the
Property (the “Project Documents”). Borrower shall pay all taxes, assessments
and other charges, fines and impositions attributable to the Property which may
attain a priority over this Deed of Trust, in the manner provided under
paragraph 2 hereof or, if not paid in such manner, by Borrower making payment,
when due, directly to the payee thereof. Borrower shall promptly furnish to
Lender all notices of amounts due under this Paragraph, and in the event
Borrower shall make payment directly, Borrower shall promptly furnish to Lender
receipts evidencing such payments. Borrower shall promptly discharge any lien
which has priority over this Deed of Trust; provided, that Borrower shall not be
required to discharge any such lien so long as Borrower shall agree in writing
to the payment of the obligation secured by such lien in a manner acceptable to
Lender and if requested by Lender, immediately post with Lender an amount
necessary to satisfy said obligation, or shall in good faith contest such lien
by, or defend enforcement of such lien in, legal proceedings which operate to
prevent the enforcement of such lien or forfeiture of the Property or any part
thereof and, if requested by Lender, immediately post with Lender an amount
necessary to satisfy said obligation.

5. Hazard Insurance. Borrower shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Deed of Trust.
This obligation shall be deemed satisfied so long as the Condominium and Resort
Owners Associations maintain a “master” or “blanket” policies for liability and
casualty insurance in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower or the
Condominium or Resort Owners Association subject to approval by Lender;
provided, that such approval shall not be unreasonably withheld. If required,
all premiums on insurance policies shall be paid in the manner provided under
paragraph 2 hereof, or, if not paid in such manner, by Borrower or the
Condominium or Resort Owners Association making payment, when due, directly to
the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower shall give Lender prompt notice of any lapse in
hazard insurance coverage. In the event of loss, Borrower shall give prompt
notice to the insurance carrier and Lender. Lender may make proof of loss if not
made promptly by Borrower.

Pursuant to the terms of the Project Documents timeshare declarations, insurance
proceeds shall be applied to restoration or repair of the Property damaged,
whether the unit or the common elements. To the extent such insurance proceeds
exceed the cost of such restoration or repair and the Board of Directors of the
Condominium or Resort Owners Association decides to disburse such excess,
Borrower’s share of such excess shall be applied to the sums secured by this
Deed of Trust, with the excess, if any, paid to Borrower. Unless Lender and
Borrower otherwise agree in writing, any such application of proceeds to
principal shall not exceed or postpone the due date of the monthly installments
referred to in paragraphs 1 and 2 hereof or change the amount of such
installments. If under paragraph 18 hereof the Property is acquired by Lender,
all right, title and interest of Borrower in and to any insurance policies and
in and to any excess insurance proceeds thereof from damage to the Property
prior to the sale or acquisition shall pass to Lender to the extent of the sums
secured by this Deed of Trust immediately prior to such sale or acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower shall perform all of Borrower’s
obligations under the Project Documents. Borrower shall take such actions as may
be reasonable to insure that the Condominium and Resort Owners Associations
maintain a public liability insurance policy acceptable in form, amount, and
extent of coverage to Lender. If a condominium rider is executed by Borrower and
recorded together with the Deed of Trust, the covenants and agreements of such
rider shall be incorporated into and shall amend and supplement the covenants
and agreements of this Deed of Trust as if the rider were a part hereof.

 

11.08.94(MV.MORT.1)

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7. Protection of Lender’s Security. If Borrower fails to perform the covenants
and agreements contained in this Deed of Trust, or if any action or proceeding
is commenced which materially affects Lender’s interest in the Property,
including, but not limited to, eminent domain, insolvency, code enforcement, or
arrangements or proceedings involving a bankrupt or decedent, then Lender at
Lender’s option, upon notice to Borrower, may make such appearances, disburse
such sums and take such action as is necessary to protect Lender’s interest,
including, but not limited to, disbursement of funds to pay reasonable
attorneys’ fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower secured by this Deed
of Trust. Unless Borrower and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower requesting payment
thereof, and shall bear interest from the date of disbursement at the rate
payable from time to time on outstanding principal under the Note unless payment
of interest at such rate would be contrary to applicable law, in which event
such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Property, provided that Lender shall give Borrower notice
prior to any such inspection specifying reasonable cause therefor related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower in connection with any condemnation or other
taking of all or part of the Property, whether of the unit or the common
elements or for any conveyance in lieu of condemnation, pursuant to the terms of
the Project Documents shall be applied to the sums secured by this Deed of
Trust, with the excess, if any, paid to Borrower.

Unless Lender and Borrower otherwise agree in writing, any such application of
proceeds to principal shall not extend or postpone the due date of the monthly
installments referred to in paragraphs 1 and 2 hereof or change the amount of
such installments.

10. Borrower Not Released. Extension of the time for payment or modification of
amortization of the sums secured by this Deed of Trust granted by Lender to any
successor in interest of Borrower shall not operate to release, in any manner,
the liability of the original Borrower and Borrower’s successors in interest.
Lender shall not be required to commence proceedings against such successor or
refuse to extend time for payment or otherwise modify amortization of the sums
secured by this Deed of Trust by reason of any demand made by the original
Borrower and Borrower’s successor in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Deed of Trust.

12. Remedies Cumulative. All remedies provided in this Deed of Trust are
distinct and cumulative to any other right or remedy under this Deed of Trust or
afforded by law or equity, and may be exercised concurrently, independently or
successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower. All covenants and
agreements of Borrower shall be joint and several. The captions and headings of
the paragraphs of this Deed of Trust are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower provided for in this Deed of Trust
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower at the Borrower’s address as set forth in the Note, or at such other
address as Borrower may designate by notice to Lender as provided herein, and
(b) any notice to Lender shall be given by certified mail, return receipt
requested, to Lender’s address stated herein or to such other address as Lender
may designate by notice to Borrower as provided herein. Any notice provided for
in this Deed of Trust shall be deemed to have been given to Borrower or Lender
when given in the manner designated herein.

15. Governing Law; Severability. This Deed of Trust shall be governed by the
laws of the state where the Property is located. In the event that any provision
or clause of this Deed of Trust or the Note conflicts with applicable law, such
conflict shall not affect other provisions of the Deed of Trust or the Note
which can be given effect without the conflicting provision, and to this end the
provisions of the Deed of Trust and the Note are declared to be severable.

16. Borrower’s Copy. Borrower shall be furnished a copy of the Note and this
Deed of Trust at the time of execution or after recordation hereof.

17. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold or transferred by Borrower without Lender’s prior
written consent, excluding (a) a transfer by devise, decent or by operation of
law upon the death of a joint tenant, (b) the creation of a purchase money
security interest for household appliances, (c) the grant of any leasehold
interest of three (3) years or less not containing an option to purchase, or
(d) the creation of a lien or encumbrance subordinate to this Deed of Trust,
Lender may, at Lender’s option, declare all the sums secured by this Deed of
Trust to be immediately due and payable. Lender shall have waived such option to
accelerate if, and only if, prior to the sale or transfer, Lender and the person
to whom the Property is to be sold or transferred reach agreement in writing
that the credit of such person is satisfactory to Lender and that the interest
payable on the sums secured by this Deed of Trust shall be at such rate Lender
shall request, and if the assumption fee set by Lender has been paid. If Lender
has waived the option to accelerate provided in this paragraph 17, and if
Borrower’s successor in interest has executed a written assumption agreement
accepted in writing by Lender, Lender shall release Borrower from all
obligations under this Deed of Trust, and the Note. Assumption of Borrower’s
Deed of Trust and Note shall be permitted only with written approval of, and at
the sole discretion of Lender.

If Lender exercises such option to accelerate, Lender, shall mail Borrower
notice of acceleration in accordance with paragraph 14 hereof. Such notice shall
provide a period of not less than thirty (30) days from the date the notice is
mailed within which Borrower may pay the sums declared due. If Borrower fails to
pay such sums prior to the expiration of such period, Lender may, without
further notice or demand on Borrower, invoke any remedies permitted by paragraph
18 hereof.

18. Acceleration; Remedies. Except as provided in paragraph 17 hereof, upon
Borrower’s breach of any covenant or agreement of Borrower in this Deed of
Trust, including the covenants to pay when due any sums secured by this Deed of
Trust, Lender prior to acceleration shall mail notice to Borrower as provided in
paragraph 14 hereof specifying: (1) the breach; (2) the action required to cure
such breach; (3) a date, not less than thirty (30) days from the date the notice
is mailed to Borrower, by which such breach must be cured; and (4) that failure
to cure such breach on or before the date specified in the notice may result in
acceleration of the sums secured by this Deed of Trust, foreclosure by judicial
proceeding and sale of Property. If the breach is not cured on or before the
date specified in the notice, Lender at Lender’s option, subject to any right of
reinstatement to which Borrower is entitled under applicable law, may declare,
without further demand, all of the sums secured by this Deed of Trust to be
immediately due and payable and may foreclose this Deed of Trust by judicial
proceedings. Lender shall be entitled to collect in such proceedings all
expenses of foreclosure, including, but not limited to, reasonable attorneys’
fees, court costs, and costs of documentary evidence, abstracts and title
reports.

 

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19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower hereby assigns to Lender the rents of the Property, provided
that Borrower shall, prior to acceleration under paragraph 18 hereof or
abandonment of the Property, have the right to collect and retain such rents as
they become due and payable. Upon acceleration or abandonment of the Property,
Lender shall be entitled without notice, to enter upon, take possession of and
manage the Property and to collect the rents of the Property, including those
past due. All rents collected shall be appointed first to payment of the costs
of management of the Property and collection of rents, including, but not
limited to, management fees, court costs, and reasonable attorneys’ fees and
then to the sum secured by this Deed of Trust. The Lender shall be liable to
account only for those rents actually received. Borrower shall not be entitled
to possession or use of the Property after abandonment or after the Lender has
accelerated the balance due. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Property. If a receiver is
appointed, any income from rents from the Property shall be applied first to the
costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower, Lender, at Lender’s option, may
make Future Advances to Borrower. Such Future Advances, with interest thereon,
shall be secured by this Deed of Trust whether or not evidenced by promissory
notes stating that said notes are secured hereby. At no time shall the principal
amount of the indebtedness secured by this Deed of Trust, not including sums
advanced in accordance herewith to protect the security of this Deed of Trust,
exceed one hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to: (i) The abandonment or termination of the applicable
condominium or timeshare regime, except for abandonment or termination required
by law in the case of substantial destruction by fire or other casualty or in
the case of a taking by condemnation or eminent domain; (ii) any amendment to
any provision of the Project Documents which is for the express benefit of
Lender; or (iii) any action which would have the effect of rendering the public
liability insurance coverage maintained by the Condominium or Resort Owners
Association unacceptable to Lender.

22. Remedies. In the event Borrower defaults in payment of the Note secured
hereby or in the performance of any covenants herein set forth, then the Lender
shall have all legal and equitable remedies available to it under Colorado law.
In addition, Lender shall have the automatic right without the appointment of a
Receiver to have access to and exclusive possession of the Resort Interest and
Resort Unit encumbered hereby or such other Resort Interest and Resort Unit
whose use has been assigned to Borrower by the Resort Owners Association or by
any exchange company. This right to exclusive occupancy and possession shall
entitle, but shall not obligate Lender to receive and retain any rental payments
to which Borrower would otherwise be entitled, which are received by Lender or
any of its related companies, or by the Condominium or Resort Owners Association
or any other rental agent.

Lender may implement the remedies provided herein by, among other methods,
giving notice of default to the Borrower, the Condominium or Resort Owners
Association and the management company responsible for the administration and
management of the Property encumbered hereby.

If the Borrower fails to deliver to Lender and to the management company an
affidavit setting forth facts contesting the default alleged by Lender prior to
the date Borrower’s use week commences, then the management company shall
thereupon be entitled to deliver possession of the condominium unit or the
rental, net only of any rental management fee, if any, to Lender. Lender, the
Condominium or Resort Owners Associations and the management company shall be
released from any claims by Borrower in connection with the exercise by Lender
of remedies herein described.

23. Attorneys’ Fees. As used in this Deed of Trust and in the Note, “attorneys’
fees” shall include attorneys’ fees, if any, which may be awarded by a trial or
an appellate court.

 

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FLORIDA SAMPLE (MVC)

[UPON CLOSING OF THE PURCHASE TO WHICH THIS NOTE APPLIES, THE UNDERSIGNED HEREBY
AUTHORIZE(S) CLOSING AGENT OR HOLDER TO COMPLETE THIS NOTE BY INSERTING THE DATE
OF THE NOTE AND APPLICABLE DATES FOR COMMENCEMENT OF PAYMENTS DUE HEREUNDER, THE
MONTHLY PAYMENT DATE AND THE FINAL PAYMENT DATE.]

NOTE SECURED BY MORTGAGE

Season/Unit No./Unit Week No(s):                                    

Lakeshore Reserve Condominium

US$            

                           , 20    

FOR VALUE RECEIVED, the undersigned                                     
(“Borrower(s)”) promise(s) to pay to the order of MARRIOTT OWNERSHIP RESORTS,
INC., (said party or any other party to whom Marriott Ownership Resorts, Inc.
may transfer and assign this Note and who holds this Note from time to time is
hereinafter called the “Holder”), Post Office Box 8038, Lakeland, Florida 33802,
or order, the principal sum of                                          
                    U.S. Dollars (US $            ), with interest on the unpaid
balance from                         , until paid, at the rate of
                         percent per annum (            %) (calculated on the
basis of a 360 day year, collected for the actual number of days principal is
outstanding in any calendar year). Principal and interest shall be payable in
lawful money of the United States at the Holder’s address set forth above, or
such other place as the Holder may, from time to time, designate, in consecutive
monthly installments of                                      U.S. Dollars (US $
            ), on the              day of each month and continuing thereafter
on the same day of each month beginning                     , for a period of
             months with the remaining unpaid principal balance, together with
accrued interest thereon, due and payable, if not sooner paid, on
                    .

The indebtedness evidenced by this Note is secured by a Mortgage, dated of even
date herewith, creating a lien on the real property described therein (the
“Property”). Reference is made to said Mortgage for rights as to acceleration of
the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a $             service fee.

Borrower(s) shall pay to the Holder a late charge of six percent (6%) for any
monthly installment not received by the Holder within ten (10) days after the
date the installment is due. The late charge will be deducted from the next
payment received.

Each payment shall be credited first to amounts due pursuant to Paragraph 2 of
the Mortgage, then to advances, if any, made by the Lender pursuant to Paragraph
7 of the Mortgage, then to the costs, fees, expenses and other amounts incurred
and advanced by the Holder in the enforcement of its rights hereunder,
including, without limitation, costs and reasonable attorneys’ fees described
below, then to interest due hereunder, including interest on any Future
Advances, then to principal due hereunder, including principal on any Future
Advances, then to unpaid service fees, then to unpaid late charges, if any.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Demand, presentment, notice of dishonor, and protest are hereby waived by all
makers, sureties, guarantors and endorsers hereof. This Note shall be a joint
and several obligation of all makers, sureties, guarantors and endorsers, and
shall be binding upon them and their heirs, personal representatives, successors
and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon any one of the following events of default:

 

  a) failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) failure of Borrower(s) to perform any other covenant or agreement of
Borrower(s) in this Note or the Mortgage within fifteen (15) days after the
mailing of notice from the Holder to the Borrower(s) specifying the nature of
such failure; and

 

  c) the insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s) as otherwise provided herein.

The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, reasonable attorneys’ fees, whether or not action be instituted
hereon, and costs of trial and appellate proceedings.

In the event of any default by the Borrower(s) hereunder, Holder at its sole
option, may charge the Borrower(s) the highest interest rate allowed by law
and/or pursue any and all remedies available to it under applicable law.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given upon depositing same in any U.S. post office, postage prepaid, addressed
to Borrower(s) at the address stated below, or to such other address as
Borrower(s) may designate by written notice to the Holder. Any notice to the
Holder shall be given by mailing such notice by certified mail, return receipt
requested, to the Holder at the address stated in the first paragraph of this
Note, or at such other address as may have been designated by written notice to
Borrower(s). Any notice provided for in this Note shall be deemed to have been
given to Borrower(s) or the Holder when given in the manner herein designated.

THIS NOTE SHALL BE GOVERNED BY, CONSTRUED UNDER AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA AND THE COURTS OF THE STATE OF
FLORIDA IN THE COUNTY OF ORANGE SHALL BE THE EXCLUSIVE COURTS OF JURISDICTION
AND VENUE FOR ANY LITIGATION OR OTHER PROCEEDING THAT MAY BE BASED ON, ARISE OUT
OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, UNLESS OTHERWISE REQUIRED BY LAW.
HOLDER AND BORROWER(S) HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON,
OR ARISING OUT OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR HOLDER EXTENDING THE LOAN
EVIDENCED BY THIS NOTE.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

Time is of the essence in the performance of each and every obligation
represented by this Note.

BORROWER’S ADDRESS:

 

              Borrower/Purchaser signs here               Borrower/Purchaser
signs here               Borrower/Purchaser signs here              
Borrower/Purchaser signs here

(Execute Original Only)

DOCUMENTARY STAMP TAXES HAVE BEEN PAID AND THE PROPER AMOUNTS AFFIXED TO THE
MORTGAGE

--------------------------------------------------------------------------------

FLORIDA SAMPLE (MVC)

[UPON CLOSING OF THE PURCHASE TO WHICH THIS MORTGAGE APPLIES, THE UNDERSIGNED
HEREBY AUTHORIZE(S) CLOSING AGENT TO COMPLETE THIS MORTGAGE BY INSERTING THE
APPROPRIATE DATE OF THE MORTGAGE AND TO COMPLETE, AS NECESSARY, THE RECORDING
INFORMATION RELATING TO THE DOCUMENTS BY WHICH THE TIMESHARE ESTATE(S) BEING
ENCUMBERED BY THIS MORTGAGE WAS(WERE) CREATED]

MORTGAGE

 

 

THIS MORTGAGE is made this                                              ,
between the Mortgagor(s),                                         
                                         
                                                         (herein “Borrower(s)”),
whose post office address is c/o Marriott Resorts Hospitality Corporation, P.O.
Box 890, Lakeland, Florida 33802, and the Mortgagee, MARRIOTT OWNERSHIP RESORTS,
INC., a Delaware corporation, the address of which is Post Office Box 8038,
Lakeland, Florida 33802 (said party, its successors and assigns is herein called
“Lender”).

WHEREAS, Borrower(s) is/are indebted to Lender in the principal sum of
                                         
                                                                            U.S.
Dollars (US$                                ), which indebtedness is evidenced
by Borrower’s Note of even date herewith (herein “Note”), providing for monthly
installments of principal and interest, with the balance of indebtedness, if not
sooner paid, due and payable                                      from the date
hereof.

TO SECURE to Lender (a) the repayment of the indebtedness evidenced by the Note,
with interest thereon, the payment of all other sums, with interest thereon,
advanced in accordance herewith to protect the security of this Mortgage, and
the performance of the covenants and agreements of Borrower(s) herein contained,
and (b) the repayment of any future advances, with interest thereon, made to
Borrower(s) by Lender pursuant to Paragraph 20 hereof (herein “Future
Advances”), Borrower(s) does hereby mortgage, grant and convey to Lender and
Lender’s successors and assigns the following described property located in the
County of Orange, State of Florida:

Season:              Unit No.              Unit Week:              Unit Type:
             Fixed Time             Floating Time            

Season:              Unit No.              Unit Week:              Unit Type:
             Fixed Time             Floating Time            

Season:              Unit No.              Unit Week:              Unit Type:
             Fixed Time             Floating Time            

Season:              Unit No.              Unit Week:              Unit Type:
             Fixed Time             Floating Time            

of Lakeshore Reserve Condominium, according to the Declaration of Condominium
thereof, recorded in Official Records Book 9741 at Page 2312 in the Public
Records of Orange County, Florida, and any amendments thereof (“Declaration”).

TO HAVE AND TO HOLD unto Lender and Lender’s successors and assigns, forever,
together with all the improvements now or hereafter erected on the property, and
all easements, rights, appurtenances, rents, royalties, mineral, oil and gas
rights and profits, water, water rights, and water stock, and all fixtures now
or hereafter attached to the property, all of which, including replacements and
additions thereto, shall be deemed to be and remain a part of the property
covered by this Mortgage; and all of the foregoing, together with said property
are herein referred to as the “Property”.

Borrower(s) covenants that Borrower(s) is/are lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant and convey the Property,
that the Property is unencumbered, and that Borrower will warrant and defend
generally the title to the Property against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions
to coverage in any title insurance policy insuring Lender’s interest in the
Property.

Borrower(s) and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower(s)
shall promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by this Mortgage.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower(s), Borrower(s) shall pay to Lender on the
day when monthly installments of principal and interest are payable under the
Note, until the Note is paid in full, a sum (herein “Funds”) equal to
one-twelfth of Borrower’s share of the yearly taxes and assessments relating to
the subject Property encumbered by this Mortgage and one-twelfth of the annual
maintenance fee or assessment due under the Declaration (herein “Condominium
Assessments”), or such other amounts or for such other periods other than
monthly, e.g., quarterly or one-fourth, etc., all as reasonably estimated
initially and from time to time by Lender on the basis of assessments and bills
and reasonable estimates thereof.

If Lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, and Condominium
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower(s) interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower(s) any interest on earnings on the Funds.
Lender shall give to Borrower(s), without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes for which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Mortgage.

 

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If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Condominium Assessments shall exceed the amount required to pay such taxes,
assessments, and Condominium Assessments as they fall due, such excess shall be,
at Borrower’s option, either promptly repaid to Borrower(s) or credited to
Borrower(s) on monthly installments of Funds. If the amount of the Funds held by
Lender shall not be sufficient to pay taxes, assessments, and Condominium
Assessments as they fall due, Borrower(s) shall pay to Lender any amount
necessary to make up the deficiency within thirty (30) days from the date of a
notice mailed by Lender to Borrower(s) requesting payment thereof, but in no
event shall Lender require payment in advance for taxes and assessments to be
held and disbursed as set forth hereunder in an amount which exceeds the
estimate of the next year’s amount for same.

Upon payment in full of all sums secured by this Mortgage, Lender shall promptly
refund to Borrower(s) any Funds held by Lender. If under Paragraph 18 hereof the
Property is sold or the Property is otherwise acquired by Lender, Lender shall
apply, no later than immediately prior to the sale of the Property or its
acquisition by Lender, any Funds then held by Lender as a credit against the
sums secured by this Mortgage.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and Paragraphs 1 and 2 hereof shall
be applied by Lender first in payment of amounts payable to Lender by
Borrower(s) under Paragraph 2 hereof, if any, then against advances, if any,
made by Lender pursuant to Paragraph 7 of this Mortgage, then to costs, fees,
expenses and other amounts incurred and advanced by the Lender in the
enforcement of its rights under the Note and this Mortgage, including, without
limitation, costs and reasonable attorneys’ fees, then to unpaid service fees,
then to interest payable on the Note, then to the principal of the Note, then to
unpaid late charges, if any, then to interest on any Future Advances made at
Lender’s option pursuant to Paragraph 20 hereof, then to principal on Future
Advances, if any, made at Lender’s option pursuant to Paragraph 20 hereof.

4. Charges; Liens. Borrower(s) shall promptly pay, when due, all Condominium
Assessments imposed by Lakeshore Reserve Condominium Association, Inc. or other
governing body of Lakeshore Reserve Condominium (the “Condominium Association”)
pursuant to the provisions of the Declaration, by-laws, rules and regulations or
other constituent documents of Lakeshore Reserve Condominium.

Borrower(s) shall pay all taxes, assessments and other charges, fines and
impositions attributable to the Property which may attain a priority over this
Mortgage, in the manner provided under Paragraph 2 hereof or, if not paid in
such manner, by Borrower(s) making payment, when due, directly to the payee
thereof. Borrower(s) shall promptly furnish to Lender all notices of amounts due
under this Paragraph, and in the event Borrower(s) shall make payment directly,
Borrower(s) shall promptly furnish to Lender receipts evidencing such payments.
Borrower(s) shall promptly discharge any lien which has priority over this
Mortgage; provided, that Borrower(s) shall not be required to discharge any such
lien so long as Borrower(s) shall agree in writing to the payment of the
obligation secured by such lien in a manner acceptable to Lender and, if
requested by Lender, immediately post with Lender an amount necessary to satisfy
said obligation, or shall in good faith contest such lien by, or defend
enforcement of such lien in, legal proceedings which operate to prevent the
enforcement of the lien or forfeiture of the Property or any part thereof and,
if requested by Lender, immediately post with Lender an amount necessary to
satisfy said obligation.

5. Hazard Insurance. Borrower(s) shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Mortgage. This
obligation shall be deemed satisfied so long as the Condominium Association
maintains a “master” or “blanket” policy in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower(s) or
the Condominium Association subject to approval by Lender; provided that such
approval shall not be unreasonably withheld. If required, all premiums on
insurance policies shall be paid in the manner provided under Paragraph 2
hereof, or, if not paid in such manner, by Borrower(s) or the Condominium
Association making payment, when due, directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower(s) shall give Lender prompt notice of any lapse
in hazard insurance coverage. In the event of loss, Borrower(s) shall give
prompt notice to the insurance carrier and Lender. Lender may make proof of loss
if not made promptly by Borrower(s).

Pursuant to the terms of the Declaration, insurance proceeds shall be applied to
restoration or repair of the Property damaged, whether the unit or the common
elements. To the extent such insurance proceeds exceed the cost of such
restoration or repair and the Board of Directors of the Condominium Association
decides to disburse such excess, Borrower’s share of such excess shall be
applied to the sums secured by this Mortgage, with the excess, if any, paid to
Borrower(s).

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not exceed or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments. If under Paragraph 18 hereof the Property is
acquired by Lender, all right, title and interest of Borrower(s) in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to Lender to
the extent of the sums secured by this Mortgage immediately prior to such sale
or acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower(s) shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower(s) shall perform all of Borrower’s
obligations under the Declaration, the by-laws and regulations of the
Condominium Association, and constituent documents. Borrower(s) shall take such
actions as may be reasonable to insure that the Condominium Association
maintains a public liability insurance policy acceptable in form, amount, and
extent of coverage to Lender. If a Condominium rider is executed by Borrower and
recorded together with the Mortgage, the covenants and agreements of such rider
shall be incorporated into and amend and supplement the covenants and agreements
of this Mortgage as if the rider were a part hereof.

7. Protection of Lender’s Security. If Borrower(s) fail(s) to perform the
covenants and agreements contained in this Mortgage, or if any action or
proceeding is commenced which materially affects Lender’s interest in the
Property, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankrupt or decedent,
then Lender at Lender’s option, upon notice to Borrower(s), may make such
appearances, disburse such sums and take such action as is necessary to protect
Lender’s interest, including, but not limited to, disbursement of funds to pay
reasonable attorneys’ fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this Paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower(s) secured by this
Mortgage. Unless Borrower(s) and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower(s) requesting
payment thereof, and shall bear interest from the date of disbursement at the
rate payable from time to time on outstanding principal under the Note unless
payment of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this Paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Property, provided that Lender shall give Borrower(s) notice
prior to any such inspection specifying reasonable cause therefor related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower(s) in connection with any condemnation or
other taking of all or any part of the Property, whether of the unit or the
common elements or for any conveyance in lieu of condemnation, pursuant to the
terms of the Declaration, are hereby assigned and shall be paid to Lender as
provided hereunder.

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments.

 

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10. Borrower(s) Not Released. Extension of the time for payment or modification
of amortization of the sums secured by this Mortgage granted by Lender to any
successor in interest of Borrower(s) shall not operate to release, in any
manner, the liability of the original Borrower(s) and Borrower’s successors in
interest. Lender shall not be required to commence proceedings against such
successor or refuse to extend time for payment or otherwise modify amortization
of the sums secured by this Mortgage by reason of any demand made by the
original Borrower(s) and Borrower’s successors in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Mortgage.

12. Remedies Cumulative. All remedies provided in this Mortgage are distinct and
cumulative to any other right or remedy under this Mortgage or afforded by law
or equity, and may be exercised concurrently, independently or successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of Paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower(s). All covenants and
agreements of Borrower(s) shall be joint and several. The captions and headings
of the paragraphs of this Mortgage are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower(s) provided for in this Mortgage
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower(s) at the Borrower’s address as set forth in the Note, or at such
other address as Borrower(s) may designate by notice to Lender as provided
herein, and (b) any notice to Lender shall be given by certified mail, return
receipt requested, to Lender’s address stated herein or to such other address as
Lender may designate by notice to Borrower(s) as provided herein. Any notice
provided for in this Mortgage shall be deemed to have been given to Borrower(s)
or Lender when given in the manner designated herein. In the event of a judicial
action to enforce this Mortgage, Borrower hereby agrees that any notice required
or service of process made incident thereto shall be sufficient if made to the
above address or to the registered agent appointed for such purposes by Borrower
pursuant to Section 721.84 Florida Statutes. Borrower may change such address by
giving Lender notice of a change of address in writing to Lender’s address
stated herein.

15. Governing Law; Severability. This Mortgage shall be governed by the laws of
the state where the Property is located. In the event that any provision or
clause of this Mortgage or the Note conflicts with applicable law, such conflict
shall not affect other provisions of this Mortgage or the Note which can be
given effect without the conflicting provision, and to this end the provisions
of the Mortgage and the Note are declared to be severable.

16. Borrower’s Copy. Borrower(s) shall be furnished a copy of the Note and of
this Mortgage at the time of execution or after recordation hereof.

17. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold (or leased with an option to purchase) or
transferred by Borrower(s) without Lender’s prior written consent, excluding
(a) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, (b) the grant of any leasehold interest of three (3) years or less
not containing an option to purchase, or (c) the creation of a lien or
encumbrance subordinate to this Mortgage, Lender may, at Lender’s option,
declare all the sums secured by this Mortgage to be immediately due and payable.
Lender shall have waived such option to accelerate if, and only if, prior to the
sale or transfer, Lender and the person to whom the Property is to be sold or
transferred reach agreement in writing that the credit of such person is
satisfactory to Lender and that the interest payable on the sums secured by this
Mortgage shall be at such rate as Lender shall request. If Lender has waived the
option to accelerate provided in this Paragraph 17, and if Borrower’s successor
in interest has executed a written assumption agreement accepted in writing by
Lender, Lender shall release Borrower(s) from all obligations under this
Mortgage and the Note.

If Lender exercises such option to accelerate, Lender shall mail Borrower(s)
notice of acceleration in accordance with Paragraph 14 hereof. Such notice shall
provide a period of not less than fifteen (15) days from the date the notice is
mailed within which Borrower(s) may pay the sums declared due. If Borrower(s)
fails to pay such sums prior to the expiration of such period, Lender may,
without further notice or demand on Borrower(s), invoke any remedies permitted
by Paragraph 18 hereof.

18. Acceleration; Remedies. Except as provided in Paragraph 17 hereof, upon
Borrower’s breach of any covenant or agreement of Borrower(s) in this Mortgage,
including the covenants to pay when due any sums secured by this Mortgage,
Lender prior to acceleration shall mail notice to Borrower(s) as provided in
Paragraph 14 hereof specifying: (1) the breach; (2) the action required to cure
such breach; (3) a date, not less than fifteen (15) days from the date the
notice is mailed to Borrower(s), by which such breach must be cured; and
(4) that failure to cure such breach on or before the date specified in the
notice may result in acceleration of the sums secured by this Mortgage,
foreclosure by judicial proceedings or other proceedings consistent with the
law, and sale of Property. If the breach is not cured on or before the date
specified in the notice, Lender at Lender’s option, subject to any right of
reinstatement to which Borrower(s) is entitled under applicable law, may
declare, without further demand, all of the sums secured by this Mortgage to be
immediately due and payable and may foreclose this Mortgage by judicial
proceedings. Lender shall be entitled to collect in such proceedings all
expenses of foreclosure, including, but not limited to, reasonable attorneys’
fees, court costs, and costs of documentary evidence, abstracts and title
reports.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower(s) hereby assigns to Lender the rents of the Property,
provided that Borrower(s) shall, prior to acceleration under Paragraph 18 hereof
or abandonment of the Property, have the right to collect and retain such rents
as they become due and payable.

Upon acceleration of the Note or abandonment of the Property, Lender shall be
entitled, without notice, to enter upon, take possession of and manage the
Property and to collect the rents of the Property, including those past due. All
rents collected shall be appointed first to payment of the costs of management
of the Property and collection of rents, including, but not limited to,
management fees, court costs, and reasonable attorneys’ fees, and then to the
sums secured by this Mortgage. The Lender shall be liable to account only for
those rents actually received. Borrower(s) shall not be entitled to possession
or use of the Property after abandonment or after the Lender has accelerated the
balance due under the Note. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Property. If a receiver is
appointed, any income from rents from the Property shall be applied first to the
costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower(s), Lender, at Lender’s option,
may make Future Advances to Borrower(s). Such Future Advances, with interest
thereon, shall be secured by this Mortgage when evidenced by promissory notes
stating that said notes are secured hereby. At no time shall the principal
amount of the indebtedness secured by this Mortgage, not including sums advanced
in accordance herewith to protect the security of this Mortgage, exceed one
hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower(s) shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to:

(i) The abandonment or termination of Lakeshore Reserve Condominium, except for
abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain;

(ii) any amendment to any provision of the Declaration, Bylaws or Rules and
Regulations of the Condominium Association, or equivalent constituent documents
of Lakeshore Reserve Condominium which is for the express benefit of Lender; or

(iii) any action which would have the effect of rendering the public liability
insurance coverage maintained by the Condominium Association unacceptable to
Lender.

22. Attorneys’ Fees. As used in this Mortgage and in the Note, “attorneys’ fees”
shall include attorneys’ fees, if any, and related costs incurred by Lender in
the enforcement of its rights under the Note and/or Mortgage, whether or not
legal action is instituted, and any fees and costs of trial and appellate
proceedings.

 

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23. Venue and Jurisdiction. Borrower hereby consents to the enforcement of the
Note and Mortgage in Orange County, Florida and hereby submits to the
jurisdiction of the courts of the state of Florida for such purpose.

IN WITNESS WHEREOF, Borrower(s) has/have executed this Mortgage on the day and
year first written above.

Signed in the presence of:

 

          Mortgagor     Mortgagor         Mortgagor     Mortgagor

 

STATE OF                                             )

   ACKNOWLEDGMENT COUNTY OF                                         )   

This Mortgage was acknowledged before me this
                                                 by
                                                             ,
                                                             ,
                                                              and
                                                                 , (i) who is
(are) personally known to me or (ii) has (have) produced
                                         
                                        [list type of identification] as
identification.

 

       

Print Name:     NOTARY PUBLIC My Commission Expires: Commission No:

(ADDITIONAL ACKNOWLEDGMENT, IF MORTGAGORS SIGN BEFORE DIFFERENT NOTARIES)

 

STATE OF                                             )

   ACKNOWLEDGMENT COUNTY OF                                         )   

This Mortgage was acknowledged before me this
                                                 by
                                                             ,
                                                             ,
                                                              and
                                                                 , (i) who is
(are) personally known to me or (ii) has (have) produced
                                         
                                        [list type of identification] as
identification.

 

        Print Name:     NOTARY PUBLIC My Commission Expires: Commission No:

 

Prepared by and return to:

  Linda S. Sellars, Marriott Resorts Title Company, Inc.   P.O. Box 24747,
Lakeland, Florida 33802

 

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HAWAII SAMPLE (MVC)

 

Mortgage No.: «LOANID»

   Vacation Ownership Interest No(s). «TR17»

Recorded:

   Preparation Date: «TODAY_ALPHA»

US $«MTG_AMT»

   Closing Date:                                         

1. DEFINED TERMS. Certain words used in this document have special meanings as
set forth below:

(a) “NOTE” - This document in which you promise to pay the Debt. You are giving
it to MARRIOTT OWNERSHIP RESORTS, INC. to pay for the Property described in the
Mortgage. The Debt and this Note are secured by the Mortgage.

(b) “DEBT” - Both the Principal and Interest charged on that portion of
Principal that is not then paid. “Principal” means the amount of «MTG_AMT» (US
$«MTG_AMT»). “Interest” is simple interest, which means that it is charged
(accrues) only on that part of the Principal which is not then paid. It is not
on a block or other basis where the dollar amount of interest is fixed in
advance. In this Note, the rate, but not the dollar amount, of Interest is
fixed. This rate is «Int_Rate» percent («INT_RATE»%) per year based on a 360-day
year, collected for the actual number of days principal is outstanding in any
calendar year. Loan payments are to be made in installments calculated to repay
the loan in full over the term of the loan and is based on the assumption that
all payments are made when due. Interest will be charged on that part of the
Principal, which has not been paid. Interest at this rate will start on the
            day of                                 ,             , and will
continue until the full amount of the Principal has been paid.

(c) “MORTGAGE” - The document entitled “Mortgage, Security Agreement and
Financing Statement with Power of Sale” which you have signed. It gives property
to the Holder as security to protect the Holder from possible losses that might
result if you do not keep the promises you make in this Note and in the
Mortgage.

(d) “YOU” - Each person who signs this Note. If more than one person signs, each
of you is fully and personally obligated to pay the full amount of the Debt and
to keep all of the other promises made in this Note. For example, the fact that
one or more of you does not pay a part of the Debt does not excuse the rest of
you from paying all of the Debt and keeping all of the other promises. The
Holder may therefore enforce its rights under this Note against each of you
individually or against some or all of you together. In legal terms, each of you
is “jointly and severally liable.”

(e) “MARRIOTT” - MARRIOTT OWNERSHIP RESORTS, INC., a Delaware corporation. Its
address is 6649 Westwood Boulevard, Suite 500, Orlando, Florida 32821-6090.

(f) “HOLDER” - Marriott or anyone who takes this Note later by transfer and who
is entitled to receive the payments you promise to make in this Note. You
understand that any Holder may transfer this Note to someone else.

(g) “CLOSING DATE” - The date indicated above.

2. YOUR PROMISE TO PAY. You promise to pay the Debt, both Principal and
Interest, plus all other sums you owe under this Note and under the Mortgage, to
the order of Marriott or any other Holder.

 

514899-1 (02.19.10)

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3. HOW, WHEN, AND WHERE YOU PROMISE TO PAY. You promise to pay the Debt, both
Principal and Interest, by making payments every month. Each monthly payment
will be in the amount of «Pay_Amt» UNITED STATES DOLLARS ($«PAY_AMT»), and must
be made on the          day of each month, starting on
                            . A service fee of «SFEE» must accompany each
monthly payment. You promise to make these payments every month until you have
paid all of the Debt. If, however, on                                 , you
still owe anything under this Note, you promise to pay the Debt in full on that
date. You promise to make your payments to Marriott at P. O. Box 8038, Lakeland,
Florida 33802, or at any other place the Holder tells you in writing to pay.

4. HOW YOUR PAYMENTS WILL BE APPLIED. In addition to Principal and Interest, you
may be required to make other payments as stated in this Note or in the
Mortgage. For example, you may be required to make other payments, such as late
charge payments, if you do not keep the promises made in this Note or in the
Mortgage (in other words, if you “default”). Further, you must also make
payments to cover service fees and returned check charges, if any. The Mortgage
states the manner in which your payments will be applied to these fees and
charges, to Interest and to Principal.

5. YOUR RIGHT TO PAY EARLIER (“PREPAYMENT”). The Mortgage states the manner and
the conditions under which you may pay the Debt before the time you promise to
do so in this Note.

6. THE HOLDER MAY REQUIRE YOU TO PAY EARLIER IF YOU BREAK YOUR PROMISES
(“ACCELERATION”). You agree that the Mortgage states the manner and the
conditions under which the Holder may require you to make immediate payment of
the Debt in full, if you default. Thus, as stated in the Mortgage, if you
default, you may lose your right to pay the Debt in monthly payments.

7. OTHER CHARGES AND COSTS YOU PROMISE TO PAY IF YOU DEFAULT.

(a) LATE CHARGES. If the Holder has not received the full amount of any monthly
payment by the end of ten (10) calendar days after the date it is due, you
promise to pay a late charge to the Holder with the next monthly payment. Each
late charge will be six percent (6%) of the late monthly payment or $25.00,
whichever is less.

(b) THE HOLDER’S COSTS AND ATTORNEY’S FEES. If you default, you promise to pay
the Holder all of the reasonable costs the Holder incurs in trying to make you
keep the promises you make in this Note and in the Mortgage. These costs
include, for example, the Holder’s reasonable attorney’s fees and costs, whether
or not the Holder sues you. You promise to pay all of these costs at once after
the Holder demands payment from you.

8. THIS NOTE IS SECURED BY THE MORTGAGE. You agree that this Note is secured by
the Mortgage.

9. YOU, AND CERTAIN OTHER PERSONS, WAIVE CERTAIN RIGHTS. You waive your rights
to require the Holder to do certain things. They are: (a) to demand payment of
amounts due (known as “presentment”); (b) to give notice that amounts due have
not been paid (known as “notice of dishonor”); and (c) to obtain an official
certification of nonpayment (known as a “protest”). Anyone else who agrees to
keep the promises made in this Note, who agrees to make payments to the Holder
if you fail to keep your promises under this Note or who signs this Note to
transfer it to someone else, also waives these rights. (These persons are known
as “guarantors, sureties and endorsers”.)

You and each guarantor, surety and endorser consent to any extension of the time
by which the payment of this Note or any monthly payments must be made and to
any other change to the terms of this Note (this includes the release of any
person liable on this Note). These extensions or changes can be made without
notice to you or any of them, and will not release or affect your liability or
the liability of any of these other persons on this Note.

 

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10. GOVERNING LAW. Hawaii law governs this Note.

11. CAPTIONS. Marriott has tried to appropriately divide and caption this Note
by its various paragraphs. Captions are a part of this Note, but obviously
cannot and do not completely or adequately explain each paragraph or the entire
agreement. Marriott recommends that you read with care each and every paragraph
of this Note and not just the captions alone. No court may treat the captions
and headings as if they explain what the paragraph means.

12. HOW ANY COURT SHOULD READ THIS NOTE. This Note was written in plain language
so that it would be easier to read and understand. It uses words which are less
accurate than the words which most courts are used to seeing. It also does not
include the long overlapping phrases used to prevent courts from reading words
too narrowly. If any court is ever asked to interpret this Note, Marriott and
you ask that it keep those facts in mind and interpret this Note as common sense
would require in order to do what Marriott and you clearly wanted this Note to
do.

By signing this document, you agree to everything that is said in this Note.

 

Your Address: «ADR1» «ADR2» «CSZC»

 

   “You” «PURCHASE_NAME_1» Printed    “You” «PURCHASE_NAME_2» Printed    “You”
«PURCHASE_NAME_3» Printed    “You” «PURCHASE_NAME_4» Printed

 

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HAWAII SAMPLE (MVC)

 

  

 

After Recordation, Return By Mail (X) Pick Up ( )

Marriott Ownership Resorts, Inc.

Attn.: New Owner Administration

Post Office Box 24747

Lakeland, Florida 33801

 

 

Tax Map Key No.: (4) 3-5-001-174 CPR No. «KN_7» Unit No «VILLA_LIST»

   Total Pages: 18

MORTGAGE, SECURITY AGREEMENT AND FINANCING

STATEMENT WITH POWER OF SALE

Vacation Ownership Interest No(s): «UNIT_BLDG_WEEK_TEXT»

 

LENDER(S) NAME:

   MARRIOTT OWNERSHIP RESORTS, INC., a Delaware corporation    6649 Westwood
Boulevard, Orlando, Florida 32821-6090

BORROWER(S) NAME AND ADDRESS: «LEGAL_NAME», whose address is «ADDR1», «ADDR2»
«CSZC».

I. DEFINED TERMS. Certain words used in this document have special meanings
which are set forth below. Other words which begin with a capital letter will
have the meaning given to such word in the Kalanipu’u Vacation Ownership Program
Declaration of Covenants, Conditions and Restrictions dated February 5, 2010
recorded in the Bureau of Conveyances of the State of Hawaii as Document
No. 2010-01837, as amended (the “Declaration”).

A. “MORTGAGE” - This document which is dated
                                    , 20         will be called the “Mortgage.”
It gives the Property to the Holder as security to protect the Holder from
possible losses that might result if you do not keep the promises you make in
the Note and in this Mortgage. You are giving it to Marriott as security for
your promise to pay for the Property, which you are purchasing from Marriott.”

B. “YOU” OR THE “BORROWER” - «LEGAL_NAME», whose address is «ADDR1», «ADDR2»
«CSZC», is the person or are the persons signing the Note and this Mortgage, and
will sometimes be called “Borrower” and sometimes simply “You.”

C. “MARRIOTT” - MARRIOTT OWNERSHIP RESORTS, INC. will be called “Marriott.” It
is a corporation organized and existing under the laws of the State of Delaware,
with its principal place of business and post office address at 6649 Westwood
Boulevard, 3rd Floor, Orlando, Florida 32821-6090.

 

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D. “HOLDER” - Marriott or anyone who takes this Mortgage and the Note later by
transfer and who is entitled to receive the payments you promise to make in the
Note and to enforce the promises you make in this Mortgage. You understand that
any Holder may transfer the Note and this Mortgage to someone else.

E. “NOTE” - The Note you are signing. The “Note” also means all changes and
extensions to the Note that you and the Holder agree to. The Note states that
you owe the Holder «MTG_AMT» UNITED STATES DOLLARS ($«MTG_AMT») which amount is
called the “Principal” plus “Interest”. You promise to pay all amounts as and
when stated in the Note. The Note is secured by this Mortgage.

F. “DEBT” - The amount you owe the Holder, both Principal and simple (not block)
Interest. These amounts will be called the “Debt.”

G. “PROPERTY” - The property that is described below in the section entitled
“Description Of The Property” and more particularly in Exhibit “A” attached to
this document, and incorporated herein by this reference.

H. “FUTURE ADVANCES” - Any amount loaned to Borrower after the date of this
Mortgage, which, unless otherwise agreed, will accrue interest at the rate set
forth in the Note.

II. BORROWER’S TRANSFER TO HOLDER OF RIGHTS IN THE PROPERTY.

You here and now mortgage, grant and convey the Property to Marriott, subject to
the terms of this Mortgage. You give this Mortgage as security for the payment
of the Note and all amounts you may owe under the Note or this Mortgage,
including the Debt, and as security that you will observe and perform all of the
promises and other agreements you make in the Note and Mortgage. This means
that, by signing this Mortgage, you are giving Marriott (and any later Holder)
those rights that are stated in this Mortgage and also those rights that the law
gives to creditors who hold mortgages on real property and security interests in
personal property. You are giving the Holder these rights to protect it from
possible losses that might result if you fail to:

A. Pay all the Debt, both Principal and Interest, that you owe the Holder as and
when stated in the Note; or

B. Pay all other sums you owe Holder under the Note and under this Mortgage,
including any Future Advances;

C. Pay, with interest, any amounts that the Holder spends under this Mortgage to
protect the value of the Property and the Holder’s rights in the Property;

D. Keep all of your other promises and agreements under the Note and this
Mortgage; or

E. Keep all of your promises and agreements under the Kalanipu’u Vacation
Ownership Program Purchase Agreement and under the Kalanipu’u Vacation Ownership
Program Buyer’s Acknowledgements pertaining to the Property, which you signed
prior to this Mortgage.

III. DESCRIPTION OF THE PROPERTY.

You give the Holder rights in the Property which is described in subparagraphs A
through F below:

A. An Ownership Interest or Ownership Interests in the Kalanipu’u Vacation
Ownership Program, which is a vacation ownership program established by the
Declaration, which includes (1) an ownership share or shares in a certain Unit
or Units in the Kalanipu’u Condominium (the “Condominium”), which ownership
share or shares established under the Declaration is (are) specified in Exhibit
“A;” (2) for each ownership share, the right to reserve or confirm and then use
for a period of approximately one (1) week, either (i) a Unit specified on
Exhibit “A” if the ownership share or share(s) is on a “Fixed Unit Rights”
basis, or (ii) a Unit in the Condominium of the same type as the particular Unit
in which a share is owned, if the ownership share or share(s) is on a “Floating
Unit Rights” basis, in

 

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either case every year or every other year, all as specified in Exhibit “A;” and
(3) membership in the Kalanipu’u Vacation Owners Association (the “Vacation
Owners Association”).

B. All rights granted to you by Condominium Documents and the Program Documents;

C. All rights in other property that you have as owner of the Ownership
Interest(s) described in Paragraph A of this section. These rights are known as
“easements, profits and appurtenances attached to the property;”

D. All rights that you have in all fixtures that are now or in the future will
be on the property described in Paragraph A of this section, and all
replacements of and additions to those fixtures. Usually, fixtures are items
that are physically attached to buildings, such as hot water heaters;

E. All of the rights and property described in Paragraphs B and C of this
section that you acquire in the future; and

F. All replacements of or additions to the property described in Paragraph C of
this section.

IV. BORROWER’S RIGHT TO MORTGAGE THE PROPERTY AND BORROWER’S OBLIGATION TO
DEFEND OWNERSHIP OF THE PROPERTY.

You here and now promise that except for the encumbrances listed in Exhibit “A”
to this document: (A) You lawfully own the Property; (B) You have the right to
mortgage, grant and convey the Property to the Holder; and (C) There are no
outstanding claims or charges against the Property.

You here and now give a general warranty of title to the Holder. This means that
you will be fully responsible for any and all losses which the Holder suffers
because someone other than you has some of the rights in the Property which you
promise that you have and are mortgaging to the Holder. You promise that you
will defend your ownership of the Property against any claims of such rights.

V. YOUR PROMISES.

You promise and you agree with the Holder as follows:

A. BORROWER’S PROMISE TO PAY PRINCIPAL AND INTEREST UNDER THE NOTE AND TO
FULFILL OTHER PAYMENT OBLIGATIONS. You will promptly pay to the Holder when due:
the Debt, both Principal and Interest, under the Note; late charges and other
charges, fees and costs stated in the Note; and all sums due under any part of
this Mortgage.

B. HOLDER’S APPLICATION OF BORROWER’S PAYMENTS. Unless the law requires
otherwise, the Holder will apply each of your payments under the Note and this
Mortgage in the following order and for the following purposes:

1. First, to pay amounts payable by Borrower for taxes, assessments and other
obligations, if any, under Paragraph C of this section;

2. Next, to pay, with interest, any amounts that the Holder spends under this
Mortgage to protect the value of the Property and the Holder’s rights in the
Property;

3. Next, to the costs, fees, expenses and other amounts incurred and advanced by
the Holder in the enforcement of its rights hereunder, including without
limitations, costs and reasonable attorneys’ fees;

4. Next, to pay any service fee charged by the Holder;

5. Next, to pay Interest then due under the Note;

 

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6. Next, to pay Principal then due under the Note;

7. Next, to pay late charges and other charges and costs you promise to pay
under the Note or this Mortgage;

8. Next, to pay interest on any Future Advances made pursuant to Paragraph X of
this section; and

9. Last, to pay principal on any Future Advances made pursuant to Paragraph X of
this section.

C. AGREEMENTS ABOUT REAL PROPERTY TAXES, ASSESSMENTS FOR THE CONDOMINIUM PROJECT
AND VACATION OWNERSHIP PROGRAM, AND OTHER CHARGES. You promise to pay all real
property taxes (which should be included in the assessment made by the Vacation
Owners Association), charges from both the Condominium Association and the
Vacation Owners Association, and all other charges and fines of every kind
imposed on or in any way related to the Property and its use. It does not matter
who is billed for these charges. For example, even if the Holder or the
Management Company for the Vacation Owners Association is billed, you must pay.

Subject to applicable law, upon written request by Holder to Borrower, Borrower
shall pay to Holder on the day when monthly installments of principal and
interest are payable under the Note, until the Note is paid in full, a sum
(herein “Funds”) equal to one-twelfth of Borrower’s share of any taxes and
assessments relating to the subject Property encumbered by this Mortgage and
one-twelfth of the Borrower’s share of the annual maintenance fee or assessment
due to the Vacation Owners Association or the Condominium Association, or such
other amounts or for such other periods other than monthly, e.g. quarterly, all
as reasonably estimated initially and from time to time by Holder on the basis
of assessments and bills and reasonable estimates thereof.

If Holder exercises this right, the Funds shall be held in an institution the
deposits or accounts of which are insured or guaranteed by a Federal or state
agency. Holder shall apply the Funds, upon receipt of the appropriate bill or
bills, to pay said taxes and assessments. Holder may not charge for so holding
and applying the Funds, analyzing said account, or verifying and compiling old
assessments and bills, unless Holder pays to Borrower interest on the Funds and
applicable law permits Holder to make such a charge. Unless applicable law
requires, Holder shall not be required to pay Borrower any interest or other
earnings on the Funds. Holder shall give to Borrower, without charge, an annual
accounting of the Funds showing credits and debits to the Funds and the purposes
for which each debit to the Funds was made. The Funds are hereby pledged as
additional security for the sums secured by this Mortgage.

If the amount of the Funds held by Holder, together with the future monthly
installments of Funds payable prior to the due dates of taxes and assessments
shall exceed the amount required to pay such taxes and assessments, as they fall
due, such excess shall be, at Borrower’s option, either promptly repaid to
Borrower or credited to Borrower on monthly installments of Funds. If the amount
of the Funds held by Holder shall not be sufficient to pay taxes and assessments
as they fall due, Borrower shall pay to Holder any amount necessary to make up
the deficiency within thirty (30) days from the date of a notice mailed by
Holder to Borrower requesting payment thereof, but in no event shall Holder
require payment in advance for taxes and assessments to be held and disbursed as
set forth hereunder in an amount which exceeds the estimate of the next year’s
amount for same.

Upon payment in full of all sums secured by this Mortgage, Holder shall promptly
refund to Borrower any funds held by Holder. If the Property is sold or the
Property is otherwise acquired by Holder, Holder shall apply, no later than
immediately prior to the sale of the Property or its acquisition by Holder, any
Funds then held by Holder as a credit against the sums secured by this Mortgage.

Without limiting the general nature of the promise made in the preceding
paragraph of this Paragraph C, you will pay all taxes, assessments, and any
other charges and fines that may now or later be imposed on the Property and
that may be superior to this Mortgage. You will do this either by making the
payments to the Vacation Ownership Association, or by making payments, when they
are due, directly to the persons entitled to them. (In this Mortgage, the word
“person” means any person, organization, governmental authority, or other
party.) If you make direct payments, then, promptly after making any of those
payments, you will give the Holder a receipt which shows that you have done

 

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so. You will promptly pay, when they are due, all assessments imposed by the
Condominium Association and the Vacation Owners Association.

Any claim, demand or charge that is made against the Property because an
obligation has not been fulfilled is known as a lien. You will promptly pay or
satisfy all liens against the Property that may be superior to this Mortgage.
This Mortgage does not, however, require you to satisfy a superior lien if:
(A) You agree, in writing, to pay the obligation which gave rise to the superior
lien and the Holder approves the way in which you agree to pay that obligation;
or (B) You, in good faith, argue or defend against the superior lien in a
lawsuit so that during the lawsuit, the superior lien may not be enforced, and
no part of the Property must be given up.

D. HAZARD INSURANCE. Since the Property consists, in part, of an interest in a
unit in a condominium project, as well as an interest in a vacation ownership
program, the Condominium Association and/or the Vacation Owners Association will
typically maintain a hazard insurance policy which covers all buildings and
other improvements that now are or in the future will be located in the project
or in the Unit, covering loss or damage caused by fire, hazards normally covered
by special form insurance policies and other hazards. Such a policy may be
referred to as the “master policy.” So long as the master policy remains in
effect and satisfies the requirements stated in this Paragraph D, you are not
required to obtain and maintain separate hazard insurance on the Property. In
the event that the Condominium Association or the Vacation Owners Association
does not maintain a master policy covering the Condominium or property in the
Condominium and in the Unit, or such master policy, in the Holder’s reasonable
opinion, is not sufficient to adequately protect Holder’s security interest in
the Property, the Holder shall have the right to require you to obtain and
maintain hazard insurance to cover the Property in the amounts and for the
periods of time required by the Holder. In the event that the insurance policy
you obtain contains provisions, known as “co-insurance requirements,” that limit
the insurance company’s obligation to pay claims if the amount of coverage is
too low, the Holder may require you to obtain an amount of coverage up to the
larger of the following two amounts: (1) the amount that you owe to the Holder
under the Note and under this Mortgage; or (2) the amount necessary to satisfy
the co-insurance requirements.

All insurance which you are required to obtain shall be carried with companies
selected by you, which companies shall be authorized to do business in the State
of Hawaii, and the Holder may require that the policies and renewals thereof be
held by the Holder and have attached thereto loss payable clauses in favor of
and in form acceptable to the Holder. You will pay the premiums on the insurance
policies by paying the insurance company directly when the premium payments are
due. If the Holder requires, you will promptly give the Holder all receipts of
paid premiums and all renewal notices that you receive.

If there is a loss or damage to the Property, you will promptly notify the
Vacation Owners Association, the Condominium Association and the Holder, if a
master policy is obtained and maintained for the Condominium and/or the Program,
or the insurance company and the Holder if you are required to obtain the
insurance coverage. If you do not promptly prove to the insurance company that
the loss or damage occurred, then the Holder may do so.

The amount paid by the insurance company is called “proceeds.” The proceeds from
any insurance obtained by the Vacation Owners Association, the Condominium
Association or you must be used to repair or to restore the damaged property
unless: (a) it is not economically possible to make the repairs or restoration;
or (b) the use of the proceeds for that purpose would lessen the protection
given to the Holder by this Mortgage; or (c) the Holder and you have agreed in
writing not to use the proceeds for that purpose. If the repair or restoration
is not economically possible or if it would lessen the Holder’s protection under
this Mortgage, then the proceeds applicable to the Property will be used to
reduce the amount that you owe to the Holder under the Note and under this
Mortgage. In addition, since a portion of the Property consists of an interest
in a Unit in the Condominium and Program, it is possible that proceeds under the
master policy will be paid to you instead of being used to repair or to restore
the damaged property. You give the Holder your rights to those proceeds, which
will be paid to the Holder, and will be used to reduce the amount that you owe
to the Holder under the Note and under this Mortgage. If any of the proceeds
remain after the amount that you owe to the Holder has been paid in full, the
remaining proceeds will be paid to you. The use of proceeds to reduce the amount
that you owe to the Holder will not be a prepayment that is subject to the
prepayment charge provisions, if any, under the Note or this Mortgage.

 

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If you abandon the Property, or if you do not answer, within thirty (30) days, a
notice from the Holder stating that the insurance company has offered to settle
a claim for insurance benefits, then the Holder has the authority to collect the
proceeds. The Holder may then use the proceeds to repair or restore the damaged
property or to reduce the amount that you owe to the Holder under the Note and
under this Mortgage. The thirty (30) day period will begin on the date the
notice is mailed or, if it is not mailed, on the date the notice is delivered.

If any proceeds are used to reduce the amount of Principal which you owe to the
Holder under the Note, that use will not delay the due date or change the amount
of any of your monthly payments under the Note and under Paragraph A of this
Section V. You and the Holder may, however, agree in writing to those delays or
changes.

If the Holder acquires the Property under Paragraph P of this Section V, all of
your rights in the insurance policies will belong to the Holder. Also, all of
your rights in any proceeds which are paid because of damage that occurred
before the Property is acquired by the Holder or sold will belong to the Holder.
The Holder’s rights in those proceeds will not, however, be greater than the
amount that you owe to the Holder under the Note and under this Mortgage
immediately before the Property is acquired by the Holder or sold.

If there is a conflict concerning the use of proceeds between the terms of this
Paragraph D and the law or the terms of the Condominium Documents and/or the
Program Documents, then that law or the terms of those documents will govern the
use of proceeds. You will promptly give the Holder notice if the master policy
or the insurance policy you obtain is interrupted or terminated.

E. BORROWER’S OBLIGATION TO MAINTAIN THE PROPERTY, AND AGREEMENTS ABOUT THE
CONDOMINIUM AND THE PROGRAM.

1. AGREEMENTS ABOUT MAINTAINING THE PROPERTY. You will keep the Unit you occupy
in good repair during the time you occupy that Unit. You will not destroy,
damage or substantially change the Unit. Without limiting the general nature of
your obligations, you promise not to store in or use on the Condominium any
hazardous materials, drugs or other contraband, or to permit any person you
allow to use your Ownership Interest to do so.

2. AGREEMENTS THAT APPLY TO THE CONDOMINIUM PROJECT AND VACATION OWNERSHIP
PROGRAM. Since the Property is an interest in a Unit in the Condominium and the
Program, you will fulfill all of your obligations under the Condominium
Documents and Program Documents. Also, you will not divide the Property into
smaller parts that may be owned separately (known as “partition”). You will not
consent to certain actions unless you have first given the Holder notice, and
obtained the Holder’s consent in writing. Those actions are:

a. The abandonment or termination of the Condominium or the Program unless the
abandonment or termination is required by law;

b. Any significant change to the Condominium Documents or Program Documents,
including, for example, a change in the percentage of ownership rights held by
apartment owners in the Condominium or a change in the percentage of ownership
rights held by vacation ownership owners in Units in the Program; or

c. A decision by the Condominium Association or the Vacation Owners Association
to terminate professional management and to begin self-management of the
Condominium or the Program.

You promise that you will do everything in your power so that the Condominium
Association and the Vacation Owners Association will each comply fully with the
documents creating and governing the Condominium and the Program, respectively.

F. HOLDER’S RIGHT TO TAKE ACTION TO PROTECT THE PROPERTY If: (1) You do not keep
your promises and agreements made in this Mortgage, or (2) someone, including
you, begins a legal proceeding that may significantly affect the Holder’s rights
in the Property (such as, for example, a legal proceeding in bankruptcy, in
probate,

 

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for condemnation, or to enforce laws or regulations), then the Holder may do and
pay for whatever is necessary to protect the value of the Property and the
Holder’s rights in the Property. The Holder’s actions under this Paragraph F may
include, for example, appearing in court, and paying reasonable attorney’s fees
and court costs. The Holder must give you notice before the Holder may take any
of these actions.

You will pay to the Holder any amounts, with interest, which the Holder spends
under this Paragraph F. This Mortgage will protect the Holder in case you do not
keep this promise to pay those amounts, with interest.

You will pay those amounts to the Holder when the Holder sends you a notice
requesting that you do so. You will also pay interest on those amounts at the
same rate stated in the Note. If, however, payment of interest at that rate
would violate the law, you will pay interest on the amounts spent by the Holder
under this Paragraph F at the highest rate that the law allows. Interest on each
amount will begin on the date that the amount is spent by the Holder. The Holder
and you may, however, agree in writing to terms of payment that are different
from those in this Paragraph F.

Although the Holder may take action under this Paragraph F, the Holder is not
required to do so.

G. HOLDER’S RIGHT TO INSPECT THE CONDOMINIUM. The Holder, and others authorized
by the Holder, may enter on and inspect the Condominium. They must do so in a
reasonable manner and at reasonable times. You agree to take such action as may
be required for Holder to conduct such an inspection. Before any one of those
inspections is made, the Holder must give you notice stating a reasonable
purpose for the inspection. That purpose must be related to the Holder’s rights
in the Property.

H. AGREEMENTS ABOUT CONDEMNATION OF THE PROPERTY. A taking of property by any
governmental authority by eminent domain is known as “condemnation.” Subject to
provisions in the documents that create and govern the Condominium and the
Program, you and the Holder make the following agreements about condemnation of
the Property:

You give to the Holder your right to the proceeds of all awards or claims for
damages resulting from condemnation or other governmental taking of the Property
(or a portion thereof) and to the proceeds from a sale of the Property (or a
portion thereof) that is made to avoid condemnation. All of those proceeds will
be paid to the Holder.

If all of the Property is taken, the proceeds will be used to reduce the amount
that you owe to the Holder under the Note and under this Mortgage. If any of the
proceeds remain after the amount that you owe to the Holder has been paid in
full, the remaining proceeds will be paid to you. Unless the Holder and you
agree otherwise in writing, if only a part of the Property is taken, the amount
that you owe to the Holder will only be reduced by the amount of proceeds
multiplied by the following amount: (1) the total amount that you owe to the
Holder under the Note and under this Mortgage immediately before the taking,
divided by (2) the fair market value of the Property immediately before the
taking. The remainder of the proceeds will be paid to you. The use of proceeds
to reduce the amount that you owe to the Holder will not be a prepayment that is
subject to the prepayment charge provisions, if any, under the Note or this
Mortgage.

If you abandon the Property, or if you do not answer within thirty (30) days, a
notice from the Holder stating that a governmental authority has offered to make
a payment or to settle a claim for damages, then the Holder has the authority to
collect the proceeds. The Holder may then use the proceeds to repair or restore
the damaged property or to reduce the amount that you owe to the Holder under
the Note and under this Mortgage. The thirty (30) day period will begin on the
date the notice is mailed or, if it is not mailed, on the date the notice is
delivered.

If any proceeds are used to reduce the amount of principal which you owe to the
Holder under the Note, that use will not delay the due date or change the amount
of any of your monthly payments under the Note. The Holder and you may, however,
agree in writing to those delays or changes.

I. CONTINUATION OF HOLDER’S RIGHTS. Even if the Holder does not exercise or
enforce any right of the Holder under this Mortgage or under the law, the Holder
will still have all of those rights and may exercise and enforce them in the
future. Even if the Holder obtains insurance, pays taxes or pays other claims,
charges or liens

 

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against the Property, the Holder will still have the right, under Paragraph P of
this Section V, to demand that you make Immediate Payment In Full (see Paragraph
P of this Section V for a definition of this phrase) of the amount that you owe
to the Holder under the Note and under this Mortgage.

J. HOLDER’S ABILITY TO ENFORCE MORE THAN ONE OF HOLDER’S RIGHTS. Each of the
Holder’s rights under this Mortgage is separate. The Holder may exercise and
enforce one or more of those rights, as well as any of the Holder’s other rights
under the law, one at a time or some or all at once.

K. JOINT AND SEVERAL LIABILITY; AGREEMENTS CONCERNING CAPTIONS. If more than one
person signs this Mortgage as Borrower, each of you is fully obligated to keep
all of Borrower’s promises and obligations contained in this Mortgage. The
Holder may enforce the Holder’s rights under this Mortgage against each of you
individually or against some or all of you together. This means that any one of
you may be required to pay all of the amounts owed under the Note and under this
Mortgage. The captions and titles of this Mortgage are for convenience only.
They may not be used to interpret or to define the terms of this Mortgage.

L. AGREEMENTS ABOUT GIVING NOTICES REQUIRED UNDER THIS MORTGAGE. Unless the law
or this Mortgage requires otherwise, any notice that must be given to you under
this Mortgage will be given by delivering or telecopying it to you or by mailing
it addressed to you at the address for giving notices stated in Paragraph B of
Section I above entitled “Defined Terms.” The Holder does not have to send the
notice to every Borrower at each of the Borrower’s addresses, if there is more
than one Borrower. A notice will be delivered at a different address if you give
the Holder a notice of your different address for notices in writing. Any notice
that must be given to the Holder under this Mortgage will be given by mailing it
to the Holder’s address stated in Paragraph C of Section I above entitled
“Defined Terms.” A notice will be mailed to the Holder at a different address if
the Holder gives you a notice of the different address. A notice required by
this Mortgage is given (and will be deemed to be received) when it is mailed or
when it is delivered or telecopied according to the requirements of this
Paragraph L.

M. AGREEMENTS ABOUT LAWSUITS AND THE LAW THAT GOVERNS THE NOTE AND THIS
MORTGAGE.

1. The law that will govern the Note and this Mortgage is the law of the State
in which the Property is located. This governing law is the law of the State of
Hawaii, which will control except to the extent that federal law may apply. If
any term of this Mortgage or of the Note conflicts with the law, all other terms
of this Mortgage and of the Note will still remain in effect if they can be
given effect without the conflicting term. This means that any terms of this
Mortgage and of the Note which conflict with the law can be separated from the
remaining terms, and the remaining terms will still be enforced.

2. To the extent permitted by applicable law, any lawsuit or other proceeding
involving the Note or this Mortgage must be filed only in Courts of the State of
Hawaii or the United States Federal District Court for the District of Hawaii.
Neither you nor the Holder is allowed to do anything to defeat the power and
right (called “jurisdiction” and “venue”) of these courts to handle any such
lawsuit or other proceeding, since it is intended that any such lawsuit or
proceeding be resolved in Hawaii where the Property is located, and because the
Note and this Mortgage are subject to Hawaii law. Even if you are not a citizen
or resident of the State of Hawaii, you submit yourself to the jurisdiction and
venue of such courts for all purposes involving the Note and this Mortgage. All
rights you have to a jury trial in any such lawsuit or proceeding you here and
now “waive.” It is intended that any disputes be submitted to a judge for
resolution.

N. BORROWER’S COPY OF THE NOTE AND OF THIS MORTGAGE. You will be given a copy of
the Note and of this Mortgage showing that these documents have been signed. You
will be given those copies either when you sign the Note and this Mortgage or
after this Mortgage has been officially recorded in the proper official records.
If you do not receive these copies you may insist that Marriott give them to
you, but you still must keep all of the promises that you make in these
documents.

 

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O. PROHIBITION ON ASSUMPTION OF THIS MORTGAGE AND HOLDER’S RIGHTS IF BORROWER
TRANSFERS THE PROPERTY. This Mortgage and the Note may not be transferred by you
to anyone else. The Holder expects you to pay all amounts due and to keep all of
the promises stated in these documents. It would not have extended credit to you
if it realized that you would have someone else assume your obligations. Thus,
if you sell or transfer the Property, unless indicated otherwise below, the
Holder will have the right to require Immediate Payment In Full (this term is
explained in Paragraph P below). The Holder will not have the right to require
Immediate Payment In Full, however, as a result of certain transfers. Those
transfers are:

1. The creation of liens or other claims against the Property that are inferior
to this Mortgage;

2. A transfer of the Property to surviving co-owners following the death of a
co-owner when the transfer is automatic according to law; and

3. Any other transfer which under federal law may be made without giving the
Holder the right to require Immediate Payment in Full.

If the Holder requires Immediate Payment In Full under this Paragraph O, the
Holder will send you in the manner described in Paragraph L of this Section V, a
notice which states this requirement. The notice will give you at least ten
(10) days to make the required payment. The ten (10) day period will begin on
the date the notice is mailed or if it is not mailed, on the date the notice is
delivered. If you do not make the required payment during that period, the
Holder may bring a lawsuit for foreclosure and sale under Paragraph P of this
Section V without giving you any further notice or demand for payment or may
foreclose under power of sale under Paragraph P of this Section V. (See
Paragraph P of this Section V for definitions of “foreclosure and sale” and
“under power of sale”).

P. HOLDER’S RIGHTS IF BORROWER FAILS TO KEEP PROMISES AND AGREEMENTS. If you do
not keep your promises and agreements made in the Note or this Mortgage, the
Holder may take any action against you that is allowed by law or this Mortgage.
For example, the Holder may sue you to collect any money you owe the Holder with
or without also suing to foreclose and sell the Property (foreclosure and sale
is explained later in this Paragraph P); to stop you from breaking your promises
and agreements (known as an action to enjoin); or to force you to keep your
promises and agreements (known as an action for specific performance).

If all of the conditions stated in the following subparagraphs 2.a, b and c of
this Paragraph P are satisfied, the Holder may also require that you pay
immediately the entire amount then remaining unpaid under the Note and under
this Mortgage (known as an “acceleration” of the Debt). The Holder may do this
without making any further demand for payment. This requirement will be called
“Immediate Payment In Full.”

If the Holder requires Immediate Payment In Full, the Holder:

1. May bring a lawsuit to take away all of your remaining rights in the Property
and to have the Property sold. At this sale the holder or another person may
acquire the Property. This is known as “foreclosure and sale.” In any lawsuit
for foreclosure and sale, the Holder will have the right to collect all costs
allowed by law; or

2. May foreclose under power of sale. This means that the Holder may have all of
your remaining rights in the Property taken away and have the Property sold
without having to file a lawsuit. To do this, the Holder must comply with the
law on foreclosure under power of sale that is stated in Chapter 667 of the
Hawaii Revised Statutes, as amended.

The Holder may require Immediate Payment In Full under this Paragraph P only if
all of the following conditions are satisfied:

a. You fail to keep any promise or agreement made in this Mortgage, including
the promises to pay when due the amounts that you owe to the Holder under the
Note and under this Mortgage; and

 

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b. The Holder sends to you, in the manner described in Paragraph L of this
Section V, a notice that states:

(1) The promise or agreement that you failed to keep;

(2) The action that you must take to correct that failure;

(3) A date by which you must correct the failure. That date must be at least ten
(10) days from the date on which the notice is mailed to you, or if it is not
mailed, from the date on which it is delivered to you;

(4) That if you do not correct the failure by the date stated in the notice, you
will be in default and the Holder may require Immediate Payment In Full, and the
Holder or another person may acquire the Property by means of foreclosure and
sale or under power of sale;

(5) That you may speak with a named representative of the Holder to discuss any
questions which you have about the matters stated in the notice;

(6) That if you satisfy the conditions stated in Paragraph P of this Section V,
you will have the right to have any lawsuit for foreclosure and sale
discontinued and to have the Note and this Mortgage remain in full effect as if
Immediate Payment In Full had never been required; and

(7) That you have the right in any lawsuit for foreclosure and sale to argue
that you kept your promises and agreements under the Note and under this
Mortgage, and to present any other defenses that you may have.

c. You do not correct the failure stated in the notice from the Holder by the
date stated in that notice.

To sell the Property in foreclosure, the Holder may sign and deliver a legal
document sufficient to transfer the Property to the purchaser at the foreclosure
sale. You give the Holder the power and right to sign and deliver such a
document on your behalf, and you may not and cannot take this power and right
away from the Holder. In legal terms, you appoint the Holder as your
“attorney-in-fact,” which appointment is coupled with an interest and,
therefore, is irrevocable even if you die or become incompetent.

The proceeds from any foreclosure and sale, whether by lawsuit or under power of
sale, shall be applied: (i) first to pay all costs and expenses of the sale,
including court costs and attorney’s fees, and (ii) then as stated in Paragraph
B of this Section V. If, however, the proceeds are not sufficient to pay all
these sums and all the other sums you owe the Holder, unless waived by the
Holder, you must still pay the Holder the difference (known as the
“deficiency”). You promise to pay any deficiency on demand from the Holder. The
Holder may force you to keep your promise to pay any deficiency, even if you
have lost all rights to the Property and even if the laws of the place where you
live (your “home state” if you do not live in Hawaii), would not permit the
Holder to enforce this promise if the Property were located there. The Holder
may take any action against you to collect the deficiency, plus all of the
Holder’s costs of collection, including its attorney’s fees, that is allowed by
law and this Mortgage.

Q. BORROWER’S RIGHT TO HAVE HOLDER’S FORECLOSURE AND SALE DISCONTINUED. Even if
the Holder has required Immediate Payment In Full, you may have the right to
have discontinued any lawsuit brought by the Holder for foreclosure and sale or
any foreclosure under power of sale or for other enforcement of this Mortgage.
You will have this right at any time before a judgment has been entered
enforcing this Mortgage, or before the sale is made by a foreclosure under power
of sale, if you satisfy the following conditions:

1. You pay to the Holder the full amount that would have been due under this
Mortgage and the Note, if the Holder had not required Immediate Payment In Full;

 

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2. You correct your failure to keep any of your other promises or agreements
made in this Mortgage;

3. You pay all of the Holder’s reasonable expenses in enforcing this Mortgage
including, for example, reasonable attorney’s fees; and

4. You do whatever the Holder reasonably requires to assure that the Holder’s
rights in the Property, the Holder’s rights under this Mortgage, and your
obligations under the Note and under this Mortgage continue unchanged.

If you fulfill all of the conditions in this Paragraph Q, then the Note and this
Mortgage will remain in full effect as if Immediate Payment In Full had never
been required.

If, however, you do not fulfill all of these conditions, you (and all persons
who have or claim rights in the Property that depend on your rights in the
Property) will lose all rights to the Property, and will not have any right to
get them back. In legal terms, you (and such other persons) will have no
“redemption rights.”

R. HOLDER’S RIGHTS TO RENTAL PAYMENTS FROM THE PROPERTY AND TO TAKE POSSESSION
OF THE PROPERTY. As additional protection for the Holder, you give to the Holder
all of your rights to any rental payments from the Property. Until the Holder
requires Immediate Payment In Full under Paragraphs O or P of this Section V,
however, or until you abandon the Property, you have the right to collect and
keep those rental payments as they become due. You have not given any of your
rights to rental payments from the Property to anyone else, and you will not do
so without the Holder’s consent in writing.

If the Holder requires Immediate Payment In Full under Paragraphs O or P of this
Section V, or if you abandon the Property, then the Holder, persons authorized
by the Holder, or a receiver appointed by a court at the Holder’s request may:
(1) collect the rental payments, including overdue rental payments, directly
from the occupants; (2) take possession of and assume all rights pertaining to
the Property; (3) manage the Property; and (4) sign, cancel and change leases or
other agreements with respect to the Property. You agree that if the Holder
notifies the occupants that the Holder has the right to collect rental payments
directly from them under this Paragraph R, the occupants may make those rental
payments to the Holder without having to ask whether you have failed to keep
your promises and agreements under this Mortgage.

If there is a judgment for the Holder in a lawsuit for foreclosure and sale, you
will pay to the Holder reasonable rent from the date the judgment is entered for
as long as you continue to have the right to occupy the Property. This does not,
however, give you the right to occupy the Property.

All rental payments collected by the Holder or by a receiver other than the rent
paid by you under this Paragraph R will be used first to pay the costs of
collecting rental payments and of managing the Property. If any part of the
rental payments remain after those costs have been paid in full, the remaining
part will be used to reduce the amount that you owe to the Holder under the Note
and under this Mortgage. The costs of managing the Property may include the
receiver’s fees, reasonable attorney’s fees and the cost of any necessary bonds.
The Holder and the receiver will be obligated to account only for those rental
payments that such receiver actually receives.

S. HOLDER’S OBLIGATION TO DISCHARGE THIS MORTGAGE WHEN THE NOTE AND THIS
MORTGAGE ARE PAID IN FULL. When the Holder has been paid all amounts due under
the Note and under this Mortgage, the Holder will discharge this Mortgage by
delivering a certificate stating that this Mortgage has been satisfied. You will
not be required to pay the Holder for the discharge, but you must pay all costs
of recording the discharge in the proper official records.

T. AGREEMENT ABOUT USURY. Usury laws are laws that control the amount of
interest that may be legally paid. You and the Holder intend to comply with the
applicable Hawaii usury laws. If, however, it is determined

 

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that any part of any Interest payment you make would be in excess of the maximum
amount allowed by law, that part will be treated as a payment of Principal.

U. AGREEMENT ABOUT PREPAYMENT. “Prepayment” means payment of Debt earlier than
the time you promise to do so. You may prepay the entire balance at any time as
long as you also pay all other amounts you owe the Holder under the Note and
this Mortgage. You may prepay any part of the unpaid balance at any time you
make a monthly payment. The only effect of a Prepayment will be to reduce the
remaining unpaid Principal. You must continue to pay monthly installments in the
same amount and on the same schedule as before, until the entire Debt is paid.
You will not be charged any penalty or premium for prepaying.

V. RIGHTS OF THE BORROWER AND THE HOLDER ARE NOT AFFECTED BY LATER PAYMENT OR
ANY PREVIOUS LACK OF ENFORCEMENT. The Holder and you may overlook a violation of
any part of the Note or this Mortgage by the other without losing the right to
enforcement later of the same or any other part of the Note or this Mortgage.
The Holder will not lose enforcement rights even if the Holder accepts any
payment you make. The Holder may still take action against you for any default,
including your not paying on time.

W. COLLECTION AGENCY AND COSTS. The Holder has the right at any one or more
times to hire an agent (and to change this agent) to collect the payments due
from you under the Note and this Mortgage. You must pay the costs of
establishing any such collection agency and the fee charged by that agency for
servicing your account. You must also pay any fees charged by any such
collection agent due to any late payments you make or any other failure by you
to keep your promises made in the Note and this Mortgage.

X. FUTURE ADVANCES. Upon request by Borrower, Holder, at Holder’s option, may
make Future Advances to Borrower. Such Future Advances, with interest thereon,
shall be secured by this Mortgage when evidenced by promissory notes stating
that said notes are secured hereby. At no time shall the principal amount of the
indebtedness secured by this Mortgage, not including sums advanced in accordance
herewith to protect the security of this Mortgage, exceed one hundred fifty
percent (150%) of the original amount of the Note.

Y. SECURITY AGREEMENT. This document is both a mortgage of all interests in real
property and a security agreement under the Uniform Commercial Code (the “Code”)
as to all personal property and fixtures which may be described in this
document. Therefore, the Holder has and may enforce a security interest in the
personal property and fixtures, and will have all rights of a secured party
under the Code. This remedy, however, will not preclude the Holder from pursuing
any other remedy available to the Holder.

Z. NOTICE REGARDING INSURANCE. Notice is hereby given by the Holder (Marriott)
to You (Borrower/Mortgagor) that you (Borrower/Mortgagor) are free to procure
any insurance policy required by this instrument from any insurance company
authorized to do business in the State of Hawaii.

(The remainder of this page is intentionally left blank.)

 

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IN WITNESS WHEREOF, the Borrower(s) has signed this Mortgage as of the day and
year first above written.

 

   Borrower «PURCHASE_NAME_1»

   Borrower «PURCHASE_NAME_2»

   Borrower «PURCHASE_NAME_3»

   Borrower «PURCHASE_NAME_4»

 

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STATE OF ____________________________

  )      )        SS.

COUNTY OF __________________________

  )   

On this              day of             , 20    , before me personally appeared
«LEGAL_NAME» to me personally known, who, being by me duly sworn or affirmed,
did say that such person executed the foregoing instrument as the free act and
deed of such person, and if applicable in the capacity shown, having been duly
authorized to execute such instrument in such capacity.

 

Notary Public, State of _______________________ Printed Name:
_____________________________ My commission expires: _____________________

(Official Stamp or Seal)

[Below Notary Certification to be completed by Hawaii Notary Only]

 

NOTARY CERTIFICATION STATEMENT

 

Document Identification or Description: Mortgage, Security Agreement and
Financing Statement with Power of Sale

 

Doc. Date: _____________, ____ or ¨ Undated at time of notarization

 

No. of Pages: ___________                 Jurisdiction: _____ Circuit

                                                             (in which notarial
act is performed)

 

_____________________________________________________________

Signature of Notary                                                  Date of
Notarization and

                                                                   
                Certification Statement

 

_____________________________________________________________________________
(Official Stamp or Seal)

Printed Name of Notary

   

 

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(ADDITIONAL ACKNOWLEDGEMENT, IF BORROWER(S) SIGN BEFORE DIFFERENT NOTARIES)

 

STATE OF ____________________________

  )      )        SS.

COUNTY OF __________________________

  )   

On this              day of             , 20    , before me personally appeared
                                                      to me personally known,
who, being by me duly sworn or affirmed, did say that such person executed the
foregoing instrument as the free act and deed of such person, and if applicable
in the capacity shown, having been duly authorized to execute such instrument in
such capacity.

 

Notary Public, State of _______________________ Printed Name:
_____________________________ My commission expires: _____________________

(Official Stamp or Seal)

[Below Notary Certification to be completed by Hawaii Notary Only]

 

NOTARY CERTIFICATION STATEMENT

 

Document Identification or Description: Mortgage, Security Agreement and
Financing Statement with Power of Sale

 

Doc. Date: _____________, ____ or ¨ Undated at time of notarization

 

No. of Pages: ___________                 Jurisdiction: _____ Circuit

                                                             (in which notarial
act is performed)

 

_____________________________________________________________

Signature of Notary                                                  Date of
Notarization and

                                                                   
                Certification Statement

 

_____________________________________________________________________________
(Official Stamp or Seal)

Printed Name of Notary

 

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EXHIBIT “A”

«EOB_DESC» Year Ownership

«WEEK_CNT_TEXT» («WEEK_CNT») Ownership Interest(s) with Fixed Time Rights and
«KN_6» Unit Rights; identified as Vacation Ownership Interest No.
«UNIT_BLDG_WEEK_TEXT»; and

as applicable, in the Kalanipu’u Vacation Ownership Program (“Program”)
consisting of the following:

I. «WEEK_CNT_TEXT» («WEEK_CNT») fee simple «EOB_DESC» Year Ownership Share(s) in
the Program consisting of an undivided «WEEKS_PER_VILLA» as tenant in common
with the holders of other undivided interests in and to the following:

(A) Unit No(s). «VILLA_LIST» (“Unit”) respectively, of the condominium project
(“Project”) known as “KALANIPU’U CONDOMINIUM,” as established by that certain
Declaration of Condominium Property Regime (“Condominium Declaration”) dated
February 22, 2010, recorded in the Bureau of Conveyances of the State of Hawaii
as Document No. 2008-040614 as amended, and as shown on the plans thereof filed
in the Bureau of Conveyances as Condominium Map No. 4598, as the same may be
amended from time to time. The description of the land set forth in the
Declaration is incorporated herein by this reference.

EXCEPTING AND RESERVING easements through the Unit appurtenant to the common
elements of the building and all other units for the support and repair of the
common elements of the building and all other units;

TOGETHER WITH:

(1) nonexclusive easements in the common elements designated for such purposes
for ingress to, egress from, utility services for, and support, maintenance and
repair of the Unit; in the other common elements for use according to their
respective purposes, subject always to the exclusive or limited use of the
limited common elements as provided in the Condominium Declaration, and in all
other units and limited common elements of said building for support; and

(2) The right to use those certain limited common elements of the Project, if
any, which are described in the Condominium Declaration as being appurtenant to
the Apartment, provided that such easement shall be deemed conveyed or
encumbered with the Apartment even though such interest is not expressly
mentioned or described in the conveyance.

SUBJECT to easements for the encroachment by any part of the common elements of
the Project now or hereafter existing thereon and for entry as may be necessary
for the operation of the Project or for making repairs therein as provided in
the Declaration.

SUBJECT, HOWEVER, to the encumbrances listed in Exhibit A to the Condominium
Declaration and to the terms and provisions of the Condominium Declaration, as
well as the terms and provisions of the Bylaws of the Association of Unit Owners
of Kalanipu’u dated the same date as the Declaration and recorded in the Bureau
as Document No. 2008-040615, as the same may have been or may be hereafter
amended or restated from time to time (the “Bylaws”).

(B) «KN_5», as established by the Condominium Declaration, in and to the common
elements of the Project, including the land, as tenant in common with the
holders of other undivided interests in and to said common elements.

 

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SUBJECT as to the common elements to nonexclusive easements appurtenant to all
units for ingress, egress, support and repair, and further subject to the right
of all other unit owners to use the common elements of the buildings.

II. The exclusive right to reserve or confirm and then use and occupy «KN_2» in
accordance with, and subject to, that certain Kalanipu’u Vacation Ownership
Program Declaration of Covenants, Conditions and Restrictions dated February 5,
2010, recorded in the Bureau as Document No. 2010-018377, as the same have been
or may be amended or otherwise modified from time (the “Declaration”) and
Reservation Procedures as defined in the Declaration, together with the right in
common with owners of all other Units to use and enjoy the common elements of
the Condominium during the Use Period assigned to each Ownership Interest.

III. Membership in the Kalanipu’u Vacation Owners Association, a Hawaii
nonprofit corporation.

SUBJECT, HOWEVER, to all encumbrances of record and limitations, including those
set forth in the Declaration and in the Deed.

 

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MASSACHUSETTS SAMPLE (MVC)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or holder to complete this Note by inserting the date
of the Note and the appropriate dates for commencement of payments due
hereunder, the monthly payment date and the final payment date.

NOTE SECURED BY MORTGAGE

Unit No./Time-Share Estate No(s):                        

Custom House Leasehold Condominium

 

US$            

   ____________________________

FOR VALUE RECEIVED, the undersigned                                 
(“Borrower(s)”) promise(s) to pay to the order of MARRIOTT OWNERSHIP RESORTS,
INC., (said party or any other party to whom Marriott Ownership Resorts, Inc.
may transfer and assign this Note and who holds this Note from time to time is
hereinafter called the “Holder”), Post Office Box 8038, Lakeland, Florida 33802,
or order, the principal sum of                                          U.S.
Dollars (US $            ), with interest on the unpaid balance from
                        , until paid, at the rate of                  percent
per annum (            %) (calculated based on a 360-day year, collected for the
actual number of days principal is outstanding in any calendar year). Principal
and interest shall be payable in lawful money of the United States at the
Holder’s address set forth above, or such other place as the Holder may, from
time to time, designate, in consecutive monthly installments of
                                     U.S. Dollars (US $             ), on the
             day of each month and continuing thereafter on the same day of each
month beginning                         , for a period of              months
with the remaining unpaid principal balance, together with accrued interest
thereon, due and payable, if not sooner paid, on
                                        .

The indebtedness evidenced by this Note is secured by a Mortgage, dated of even
date herewith, creating a lien on the real property described therein (the
“Property”). Reference is made to said Mortgage for rights as to acceleration of
the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a $4.00 service fee.

Borrower(s) shall pay to the Holder a late charge of six percent (6%) of any
monthly installment not received by the Holder within ten (10) days after the
date the installment is due.

Each monthly payment will be applied as of its scheduled due date and shall be
credited first to amounts due pursuant to Paragraph 2 of the Mortgage, then to
advances, if any, made by the Lender (as defined in the Mortgage) pursuant to
Paragraph 7 of the Mortgage, then to the costs, fees, expenses and other amounts
incurred and advanced by the Holder in the enforcement of its rights hereunder
and under the Mortgage, including, without limitation, costs and reasonable
attorney’s fees, then to unpaid service fees, then to interest due hereunder,
then to principal due hereunder, then to unpaid late charges, if any, then to
interest on any Future Advances made pursuant to Paragraph 20 of the Mortgage,
and then to principal of any Future Advances made pursuant to Paragraph 20 of
the Mortgage.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued and any other charges
then due shall be applied against the principal amount outstanding but shall not
postpone the due date of any subsequent monthly installments or change the
amount of such installments.

Demand, presentment, notice of dishonor, and protest are hereby waived by
Borrower(s) and all sureties, guarantors and endorsers hereof. This Note shall
be a joint and several obligation of Borrower(s) and all sureties, guarantors
and endorsers, and shall be binding upon them and their heirs, personal
representatives, successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon any one of the following events of default:

 

  a) failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) the insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s) as otherwise provided herein;

 

  c) any breach of the Mortgage securing this Note, including a transfer of any
interest in the Property without Holder’s consent.

The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, reasonable attorney’s fees, whether or not action be instituted
hereon, and costs of trial and appellate proceedings.

In the event of any default by the Borrower(s) hereunder, Holder at its sole
option, may charge the Borrower(s) interest at the rate of nineteen (19) percent
per annum on any payment from Borrower(s) to the Holder which is past due and/or
pursue any and all remedies available to it under applicable law.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given upon depositing same in any U.S. post office, postage prepaid, addressed
to Borrower(s) at the address stated below, or to such other address as
Borrower(s) may designate by written notice to the Holder. Any notice to the
Holder shall be given by mailing such notice by certified mail, return receipt
requested, to the Holder at the address stated in the first paragraph of this
Note, or at such other address as may have been designated by written notice to
Borrower(s). Any notice provided for in this Note shall be deemed to have been
given to Borrower(s) or the Holder when given in the manner herein designated.

THIS NOTE SHALL BE GOVERNED BY, CONSTRUED UNDER AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MASSACHUSETTS AND THE COURTS OF THE
STATE OF MASSACHUSETTS IN THE COUNTY OF SUFFOLK SHALL BE THE EXCLUSIVE COURTS OF
JURISDICTION AND VENUE FOR ANY LITIGATION OR OTHER PROCEEDING THAT MAY BE BASED
ON, ARISE OUT OF, UNDER OR IN CONJUNCTION WITH THIS NOTE. HOLDER AND BORROWER(S)
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF,
UNDER OR IN CONJUNCTION WITH THIS NOTE, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR HOLDER EXTENDING THE LOAN EVIDENCED BY
THIS NOTE.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision of the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall never exceed the maximum amount of interest, nor produce a rate in excess
of the maximum non-usurious rate of interest, that Holder may charge Borrower(s)
under applicable law and in regard to which Borrower(s) may not successfully
assert the claim or defense of usury; and (iii) if any excess interest is
provided for or collected, it shall be deemed a mistake and the same shall
either be refunded to Borrower(s) or credited on the unpaid principal amount
hereof, and this Note shall be automatically deemed reformed so as to permit
only the collection of the maximum non-usurious rate and amount of interest
allowable under applicable law.

Time is of the essence in the performance of each and every obligation
represented by this Note.

IN WITNESS WHEREOF, Borrower(s) has/have executed this Note as an instrument
under seal.

BORROWER’S ADDRESS:

 

              Borrower/Purchaser signs here               Borrower/Purchaser
signs here               Borrower/Purchaser signs here              
Borrower/Purchaser signs here

(Execute Original Only)

--------------------------------------------------------------------------------

MASSACHUSETTS SAMPLE (MVC)

Upon closing of the purchase to which this Mortgage applies, the undersigned
hereby authorize(s) closing agent to complete this Mortgage by inserting the
appropriate date of the Mortgage and to complete, as necessary, the recording
information relating to the documents by which the Time-Share Estate(s) being
encumbered by this Mortgage was(were) created.

MORTGAGE

THIS MORTGAGE is made as of                             , between the
Mortgagor(s),                                       
                                  (herein “Borrower(s)”), whose address is
                                         
                                       , and the Mortgagee, MARRIOTT OWNERSHIP
RESORTS, INC., a Delaware corporation, the address of which is Post Office Box
24747, Lakeland, Florida 33802 (said party, its successors and assigns is herein
called “Lender”).

WHEREAS, Borrower(s) is/are indebted to Lender in the principal sum of
                                                                      U.S.
Dollars (US$            ), which indebtedness is evidenced by Borrower’s Note of
even date herewith (herein “Note”), providing for monthly installments of
principal and interest, with the balance of indebtedness, if not sooner paid,
due and payable              months from the date hereof.

TO SECURE to Lender (a) the repayment of the indebtedness evidenced by the Note,
with interest thereon, the payment of all other sums, with interest thereon,
advanced in accordance herewith to protect the security of this Mortgage, and
the performance of the covenants and agreements of Borrower(s) herein contained,
and (b) the repayment of any future advances, with interest thereon, made to
Borrower(s) by Lender pursuant to Paragraph 20 hereof (herein “Future
Advances”), Borrower(s) does hereby mortgage, grant and convey to Lender and
Lender’s successors and assigns with Mortgage Covenants, the following described
property located in the County of Suffolk, Commonwealth of Massachusetts:

The Time-Share Estate numbered                      in Unit Numbers(s)
                     all as contained in the Grant of Time-Share Lease from
Lender, as grantor, to Borrower(s), as grantee, of even date with this Mortgage
and recorded herewith. Said Time-Share Estate(s) is/are in the Custom House
Leasehold Condominium created by the Leasehold Master Deed and Time-Share
Instrument dated December 12, 1996, and recorded with the Suffolk County
Registry of Deeds in Book 21068 at Page 001, as it may have been amended from
time to time (the “Master Deed”).

And Also, all of the rights, privileges, easements, and interests in common
areas appertaining to the above-described property as set forth in the Master
Deed and the Operating Agreement and By-Laws of Custom House Leasehold
Condominium Association, LLC.

TO HAVE AND TO HOLD unto Lender and Lender’s successors and assigns, forever,
together with all the improvements now or hereafter erected on the property, and
all easements, rights, appurtenances, rents, royalties, mineral, oil and gas
rights and profits, water, water rights, and water stock, and all fixtures now
or hereafter attached to the property, all of which, including replacements and
additions thereto, shall be deemed to be and remain a part of the property
covered by this Mortgage; and all of the foregoing, together with said property
are herein referred to as the “Property”.

Borrower(s) covenants that Borrower(s) is/are lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant and convey the Property,
that the Property is unencumbered, and that Borrower will warrant and defend
generally the title to the Property against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions
to coverage in any title insurance policy insuring Lender’s interest in the
Property.

 

Return To:   

MARRIOTT OWNERSHIP RESORTS, INC.

PO BOX 24747

LAKELAND, FLORIDA 33802

 

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Borrower(s) and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower(s)
shall promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by this Mortgage.

2. Funds for Condominium Assessments and Insurance. Subject to applicable law,
upon written request by Lender to Borrower(s), Borrower(s) shall pay to Lender
on the day when monthly installments of principal and interest are payable under
the Note, until the Note is paid in full, a sum (herein “Funds”) equal to
one-twelfth of the annual maintenance fee and other charges due under the Master
Deed (herein “Condominium Assessments”), or such other amounts or for such other
periods other than monthly, e.g., quarterly or one-fourth, etc., all as
reasonably estimated initially and from time to time by Lender on the basis of
assessments and bills and reasonable estimates thereof.

If Lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Lender shall apply the Funds to pay said Condominium
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower(s) interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower(s) any interest or earnings on the Funds.
Lender shall give to Borrower(s), without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes for which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Mortgage.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Condominium Assessments shall exceed the amount required to pay such Condominium
Assessments as they fall due, such excess shall be, at Borrower’s option, either
promptly repaid to Borrower(s) or credited to Borrower(s) future monthly
installments of Funds. If the amount of the Funds held by Lender shall not be
sufficient to pay Condominium Assessments as they fall due, Borrower(s) shall
pay to Lender any amount necessary to make up the deficiency within thirty
(30) days from the date of a notice mailed by Lender to Borrower(s) requesting
payment thereof.

Upon payment in full of all sums secured by this Mortgage, Lender shall promptly
refund to Borrower(s) any Funds held by Lender. If under Paragraph 18 hereof the
Property is sold or the Property is otherwise acquired by Lender, Lender shall
apply, no later than immediately prior to the sale of the Property or its
acquisition by Lender, any Funds then held by Lender as a credit against the
sums secured by this Mortgage.

3. Application of Payments. Except as otherwise provided by applicable law, all
payments accepted and applied by Lender under the Note and Paragraphs 1 and 2
hereof, shall be applied in the following order of priority: (a) first to
amounts due pursuant to Paragraph 2 hereof; (b) then to advances, if any, made
by Lender pursuant to Paragraph 7 hereof; (c) then to costs, fees, expenses and
other amounts incurred and advanced by the Lender in the enforcement of its
rights under the Note and this Mortgage, including, without limitation, costs
and reasonable attorneys’ fees; (d) then to unpaid service fees due under the
Note; (e) then to interest due on the Note; (f) then to principal due under the
Note; (g) then to unpaid late charges due under the Note, if any; (h) then to
interest due on any Future Advances made pursuant to Paragraph 20 hereof; and,
(i) then to principal due on any Future Advances made pursuant to Paragraph 20
hereof.

4. Charges; Liens. Borrower(s) shall promptly pay, when due, all Condominium
Assessments imposed by Custom House Leasehold Condominium Association, LLC or
other governing body of Custom House Leasehold Condominium (the “Condominium
Association”) pursuant to the provisions of the Master Deed, operating agreement
and by-laws, rules and regulations or other constituent documents of Custom
House Leasehold Condominium.

Borrower(s) shall pay all charges, fines and impositions attributable to the
Property which may attain a priority over this Mortgage, in the manner provided
under Paragraph 2 hereof or, if not paid in such manner, by Borrower(s) making
payment, when due, directly to the payee thereof. Borrower(s) shall promptly
furnish to Lender all notices of amounts due under this Paragraph, and in the
event Borrower(s) shall make payment directly, Borrower(s) shall promptly
furnish to Lender receipts evidencing such payments. Borrower(s) shall promptly
discharge any lien which has priority over this Mortgage; provided, that
Borrower(s) shall not be required to discharge any such lien so long as
Borrower(s) shall agree in writing to the payment of the obligation secured by
such lien in a manner acceptable to Lender and, if requested by Lender,
immediately post with Lender an amount necessary to satisfy said obligation, or
shall in good faith contest such lien by, or defend enforcement of such lien in,
legal proceedings which operate to prevent the enforcement of the lien or
forfeiture of the Property or any part thereof and, if requested by Lender,
immediately post with Lender an amount necessary to satisfy said obligation.

5. Hazard Insurance. Borrower(s) shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Mortgage. This
obligation shall be deemed satisfied so long as the Condominium Association
maintains a “master” or “blanket” policy in accordance with the terms hereof.

 

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The insurance carrier providing the insurance shall be chosen by Borrower(s) or
the Condominium Association subject to approval by Lender; provided, that such
approval shall not be unreasonably withheld. If required, all premiums on
insurance policies shall be paid in the manner provided under Paragraph 2
hereof, or, if not paid in such manner, by Borrower(s) or the Condominium
Association making payment, when due, directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower(s) shall give Lender prompt notice of any lapse
in hazard insurance coverage. In the event of loss, Borrower(s) shall give
prompt notice to the insurance carrier and Lender. Lender may make proof of loss
if not made promptly by Borrower(s).

Pursuant to the terms of the Master Deed, insurance proceeds shall be applied to
restoration or repair of the Property damaged, whether the unit or the common
elements. To the extent such insurance proceeds exceed the cost of such
restoration or repair and the Board of Directors of the Condominium Association
decides to disburse such excess, Borrower’s share of such excess shall be
applied to the sums secured by this Mortgage, with the excess, if any, paid to
Borrower(s).

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not exceed or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments. If under Paragraph 18 hereof the Property is
acquired by Lender, all right, title and interest of Borrower(s) in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to Lender to
the extent of the sums secured by this Mortgage immediately prior to such sale
or acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower(s) shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower(s) shall perform all of Borrower’s
obligations under the Master Deed, the operating agreement and by-laws and rules
and regulations of the Condominium Association, and constituent documents.
Borrower(s) shall take such actions as may be reasonable to insure that the
Condominium Association maintains a public liability insurance policy acceptable
in form, amount, and extent of coverage to Lender. If a Condominium rider is
executed by Borrower and recorded together with the Mortgage, the covenants and
agreements of such rider shall be incorporated into and amend and supplement the
covenants and agreements of this Mortgage as if the rider were a part hereof.

7. Protection of Lender’s Security. If Borrower(s) fail(s) to perform the
covenants and agreements contained in this Mortgage, or if any action or
proceeding is commenced which materially affects Lender’s interest in the
Property, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankrupt or decedent,
then Lender at Lender’s option, upon notice to Borrower(s), may make such
appearances, disburse such sums and take such action as is necessary to protect
Lender’s interest, including, but not limited to, disbursement of funds to pay
reasonable attorneys’ fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this Paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower(s) secured by this
Mortgage. Unless Borrower(s) and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower(s) requesting
payment thereof, and shall bear interest from the date of disbursement at the
rate payable from time to time on outstanding principal under the Note unless
payment of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this Paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Property, provided that Lender shall give Borrower(s) notice
prior to any such inspection specifying reasonable cause therefore related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower(s) in connection with any condemnation or
other taking of all or any part of the Property, whether of the unit or the
common elements or for any conveyance in lieu of condemnation, pursuant to the
terms of the Master Deed, are hereby assigned and shall be paid to Lender and
applied to the sums secured by this Mortgage.

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments.

10. Borrower(s) Not Released. Extension of the time for payment or modification
of amortization of the sums secured by this Mortgage granted by Lender to any
successor in interest of Borrower(s) shall not operate to release, in any
manner, the liability of the original Borrower(s) and Borrower’s successors in
interest. Lender shall not be required to commence proceedings against such
successor or refuse to extend time for payment or otherwise modify amortization
of the sums secured by this Mortgage by reason of any demand made by the
original Borrower(s) and Borrower’s successors in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender, or any other action taken by Lender to protect its interest in the
Property shall not be a waiver of Lender’s right to accelerate the maturity of
the indebtedness secured by this Mortgage.

 

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12. Remedies Cumulative. All remedies provided in this Mortgage are distinct and
cumulative to any other right or remedy under this Mortgage or afforded by law
or equity, and may be exercised concurrently, independently or successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of Paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower(s). All covenants and
agreements of Borrower(s) shall be joint and several. The captions and headings
of the Paragraphs of this Mortgage are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower(s) provided for in this Mortgage
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower(s) at the Borrower’s address as set forth in the Note, or at such
other address as Borrower(s) may designate by notice to Lender as provided
herein, and (b) any notice to Lender shall be given by certified mail, return
receipt requested, to Lender’s address stated herein or to such other address as
Lender may designate by notice to Borrower(s) as provided herein. Any notice
provided for in this Mortgage shall be deemed to have been given to Borrower(s)
or Lender when given in the manner designated herein.

15. Governing Law; Severability. This Mortgage shall be governed by the laws of
the state where the Property is located. In the event that any provision or
clause of this Mortgage or the Note conflicts with applicable law, such conflict
shall not affect other provisions of this Mortgage or the Note which can be
given effect without the conflicting provision, and to this end the provisions
of the Mortgage and the Note are declared to be severable.

16. Borrower’s Copy. Borrower(s) shall be furnished a copy of the Note and of
this Mortgage at the time of execution or after recordation hereof.

17. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold (or leased with an option to purchase) or
transferred by Borrower(s) without Lender’s prior written consent, excluding
(a) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, (b) the grant of any leasehold interest of three (3) years or less
not containing an option to purchase, or (c) the creation of a lien or
encumbrance subordinate to this Mortgage, Lender may, at Lender’s option,
declare all the sums secured by this Mortgage to be immediately due and payable.
Lender shall have waived such option to accelerate if, and only if, prior to the
sale or transfer, Lender and the person to whom the Property is to be sold or
transferred reach agreement in writing that the credit of such person is
satisfactory to Lender, that the interest payable on the sums secured by this
Mortgage shall be at such rate as Lender shall request, and that such person
assumes all of the Borrower(s) obligations under the Note and this Mortgage (as
so modified). If Lender has waived the option to accelerate provided in this
Paragraph 17, and if Borrower’s successor in interest has executed a written
assumption agreement accepted in writing by Lender, Lender shall release
Borrower(s) from all obligations under this Mortgage and the Note.

If Lender exercises such option to accelerate, Lender shall mail Borrower(s)
notice of acceleration in accordance with Paragraph 14 hereof. Such notice shall
provide a period of not less than fifteen (15) days from the date the notice is
mailed within which Borrower(s) may pay the sums declared due. If Borrower(s)
fails to pay such sums prior to the expiration of such period, Lender may,
without further notice or demand on Borrower(s), invoke any remedies permitted
by Paragraph 18 hereof.

18. Acceleration; Remedies. Lender shall give notice to Borrower(s) prior to
acceleration following the breach by Borrower(s) of any covenant or agreement in
this Mortgage (but not prior to acceleration under Paragraph 17 unless
applicable law provides otherwise). The notice shall specify: (a) the default;
(b) the action required to cure the default; (c) a date, not less than 15 days
from the date the notice is given to Borrower(s), by which the default must be
cured; and (d) that failure to cure the default on or before the date specified
in the notice may result in acceleration of the sums secured by this Mortgage
and sale of the Property. The notice shall further inform Borrower(s) of the
right to reinstate after acceleration and the right to bring a court action to
assert the non-existence of a default or any other defense of Borrower(s) to
acceleration and sale. If the default is not cured on or before the date
specified in the notice, Lender at its option may require immediate payment in
full of all sums secured by this Mortgage without further demand and may invoke
the STATUTORY POWER OF SALE and any other remedies permitted by applicable law.
Lender shall be entitled to collect all expenses incurred in pursuing the
remedies provided in this Paragraph 18, including, but not limited to,
reasonable attorneys’ fees and costs of title evidence.

If Lender invokes the STATUTORY POWER OF SALE, Lender shall mail a copy of a
notice of sale to Borrower(s), and to other persons prescribed by applicable
law, in the manner provided by applicable law. Lender shall publish the notice
of sale, and the Property shall be sold in the manner prescribed by applicable
law at one of the following locations: (a) the Property; (b) the office of the
Lender’s attorney located in Boston, Massachusetts; or (c) the office of First
American Title Insurance Company located in Boson, Massachusetts. Lender or its
designee may purchase the Property at any sale. The proceeds of the sale shall
be applied in the following order: (a) to all expenses of the sale, including,
but not limited to, reasonable attorneys’ fees; (b) to all sums secured by this
Mortgage; and (c) any excess to the person or persons legally entitled to it.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower(s) hereby assigns to Lender the rents of the Property,
provided that Borrower(s) shall, prior to acceleration under Paragraph 18 hereof
or abandonment of the Property, have the right to collect and retain such rents
as they become due and payable. Notwithstanding the foregoing, in the event
Borrower(s) is

 

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denied occupancy of the Property for failure to pay Condominium Assessments and
the Condominium Association, or its designee, rents the Property pursuant to the
provisions of the Master Deed, the income derived therefrom shall be distributed
in accordance with the provisions of Section 27 of the Master Deed. The
Condominium Association, or its designee, is authorized and entitled to rely
conclusively upon written statements furnished to it by Lender regarding the
amounts due under the Note and secured by this Mortgage.

Upon acceleration or abandonment of the Property, Lender shall be entitled
without notice, to enter upon, take possession of and manage the Property and to
collect the rents of the Property, including those past due. All rents collected
shall be applied first to payment of the costs of management of the Property and
collection of rents, including, but not limited to, management fees, court
costs, and reasonable attorneys’ fees and then to the sums secured by this
Mortgage. The Lender shall be liable to account only for those rents actually
received. Borrower(s) shall not be entitled to possession or use of the Property
after abandonment or after the Lender has accelerated the balance due.
Alternatively, Lender may seek the appointment of a receiver to manage and
collect rents from the Property. If a receiver is appointed, any income from
rents from the Property shall be applied first to the costs of receivership, and
then in the order set forth above.

20. Future Advances. Upon request by Borrower(s), Lender, at Lender’s option,
may make Future Advances to Borrower(s). Such Future Advances, with interest
thereon, shall be evidenced by promissory notes which shall be secured by
amendments to this Mortgage. At no time shall the principal amount of the
indebtedness secured by this Mortgage, not including sums advanced in accordance
herewith to protect the security of this Mortgage, exceed one hundred fifty
percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower(s) shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to:

(i) The abandonment or termination of Custom House Leasehold Condominium, except
for abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain;

(ii) any amendment to any provision of the Master Deed, Operating Agreement and
By-Laws or Rules and Regulations of the Condominium Association, or equivalent
constituent documents of Custom House Leasehold Condominium; or

(iii) any action which would have the effect of rendering the insurance coverage
maintained by the Condominium Association unacceptable to Lender.

22. Sale of Note; Change of Loan Servicer. The Note or a partial interest in the
Note (together with this Mortgage) may be sold one or more times without prior
notice to Borrower(s) A sale may result in a change in the entity (known as the
“Loan Servicer”) that collects monthly payments due under the Note and this
Mortgage. There also may be one or more changes of the Loan Servicer unrelated
to a sale of the Note. If there is a change of the Loan Servicer, Borrower(s)
will be given written notice of the change in accordance with Paragraph 14 above
and applicable law. The notice will state the name and address of the new Loan
Servicer and the address to which payments should be made. The notice will also
contain any other information required by applicable law.

23. Release. Upon payment of all sums secured by this Mortgage, Lender shall
discharge this Mortgage. Borrower(s) shall pay any recordation costs, Lender’s
administrative charges and other expenses incurred in connection with such
discharge.

24. Waivers. Borrower(s) waives all rights of homestead exemption in the
Property and relinquishes all rights of curtesy and dower in the Property.

25. Attorneys’ Fees. As used in this Mortgage and in the Note, “attorneys’ fees”
shall include attorneys’ fees, if any, and related costs incurred by Lender in
the enforcement of its rights under the Note and/or Mortgage, whether or not
legal action is instituted, and any fees and costs of trial and appellate
proceedings.

26. Power of Sale. This Mortgage is upon the Statutory Condition for breach of
which Mortgagee shall have the Statutory Power of Sale.

IN WITNESS WHEREOF, Borrower(s) has/have executed this Mortgage as an instrument
under seal.

 

   Mortgagor    Mortgagor    Mortgagor    Mortgagor

 

   Page 5    455971-3 06.22.09      

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(ACKNOWLEDGMENT IF MORTGAGORS SIGN BEFORE NOTARIES IN MASSACHUSETTS)

ACKNOWLEDGMENT

COMMONWEALTH OF MASSACHUSETTS

COUNTY OF                                 

On this              day of                     , 20__, before me, the
undersigned notary public, personally appeared                              and
                             (insert names of document signer), proved to me
through satisfactory evidence of identification, which was
                         (insert type of identification provided) to be the
persons whose names are signed on the preceding or attached document, and
acknowledged to me that he/she/they signed it voluntarily for its stated
purpose.

 

   NOTARY PUBLIC My Commission Expires:

(ADDITIONAL ACKNOWLEDGMENT IF MORTGAGORS SIGN BEFORE DIFFERENT NOTARIES IN
MASSACHUSETS)

ACKNOWLEDGMENT

COMMONWEALTH OF MASSACHUSETTS

COUNTY OF                                 

On this              day of                     , 20__, before me, the
undersigned notary public, personally appeared                      (insert name
of document signer), proved to me through satisfactory evidence of
identification, which was                              (insert type of
identification provided) to be the person whose name is signed on the preceding
or attached document, and acknowledged to me that he/she signed it voluntarily
for its stated purpose.

 

   NOTARY PUBLIC My Commission Expires:

(ADDITIONAL ACKNOWLEDGMENT IF MORTGAGORS SIGN BEFORE NOTARIES OUTSIDE
MASSACHUSETTS)

 

STATE OF                                 

COUNTY OF                             

  

)

)

This Mortgage was acknowledged before me this                              by
                                        ,
                                        ,
                                              and                             ,
as his/her/their free act and deed. The foregoing person(s) personally appeared
before me and (i) is (are) personally known to me or (ii) has (have) produced
                             [list type of identification] as identification.

 

   (Print Name:                         
                                              ) NOTARY PUBLIC My Commission
Expires:

 

   Page 6    455971-3 06.22.09      

--------------------------------------------------------------------------------

MISSOURI SAMPLE (MVC)

[UPON CLOSING OF THE PURCHASE TO WHICH THIS NOTE APPLIES, THE UNDERSIGNED HEREBY
AUTHORIZE(S) CLOSING AGENT OR HOLDER TO COMPLETE THIS NOTE BY INSERTING THE DATE
OF THE NOTE AND APPLICABLE DATES FOR COMMENCEMENT OF PAYMENTS DUE HEREUNDER, THE
MONTHLY PAYMENT DATE AND THE FINAL PAYMENT DATE.]

NOTE SECURED BY DEED OF TRUST

Unit No./Unit Week No(s):                                

HAB Condominium

US$                        

            , 20    

FOR VALUE RECEIVED, the undersigned              (“Borrower(s)”) promise(s) to
pay to the order of MARRIOTT OWNERSHIP RESORTS, INC., (said party or any other
party to whom Marriott Ownership Resorts, Inc. may transfer and assign this Note
and who holds this Note from time to time is hereinafter called the “Holder”),
Post Office Box 8038, Lakeland, Florida 33802, or order, the principal sum of
             U.S. Dollars (US $            ), with interest on the unpaid
balance from             , until paid, at the rate of              percent per
annum (            %). (calculated on the basis of a 360 day year, collected for
the actual number of days principal is outstanding in any calendar year.)
Principal and interest shall be payable in lawful money of the United States at
the Holder’s address set forth above, or such other place as the Holder may,
from time to time, designate, in consecutive monthly installments of
             U.S. Dollars (US $             ), on the              day of each
month and continuing thereafter on the same day of each month beginning
            , for a period of              months with the remaining unpaid
principal balance, together with accrued interest thereon, due and payable, if
not sooner paid, on             .

The indebtedness evidenced by this Note is secured by a Deed of Trust dated of
even date herewith, creating a lien on the real property described therein (the
“Property”). Reference is made to said Deed of Trust for rights as to
acceleration of the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a $             service fee.

Borrower(s) shall pay to the Holder a late charge of five percent (5%) of the
installment due or $15.00, whichever is greater, not to exceed $50.00 for any
monthly installment not received by the Holder within fifteen (15) days after
the date the installment is due. The late charge will be deducted from the next
payment received.

Each payment shall be credited first to amounts due pursuant to Paragraph 2 of
the Deed of Trust, then to advances, if any, made by the Holder pursuant to
Paragraph 7 of the Deed of Trust, then to the costs, fees, expenses and other
amounts incurred and advanced by the Holder in the enforcement of its rights
hereunder, including, without limitation, costs and reasonable attorney’s fees,
then to unpaid service fees, then to interest due hereunder, then to principal
due hereunder, then to unpaid late charges, if any, then to interest on any
Future Advances made pursuant to Paragraph 20 of the Deed of Trust, then to
principal on any Future Advances.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Demand, presentment, notice of dishonor, and protest are hereby waived by
Borrower(s) all makers, sureties, guarantors and endorsers hereof. This Note
shall be a joint and several obligation of Borrower(s), all makers, sureties,
guarantors and endorsers, and shall be binding upon them and their heirs,
personal representatives, successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon any one of the following events of default:

 

  a) failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) failure of Borrower(s) to perform any other covenant or agreement of
Borrower(s) in this Note or the Deed of Trust within fifteen (15) days after the
mailing of notice from the Holder to the Borrower(s) specifying the nature of
such failure; and

 

  c) the insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s) as otherwise provided herein.

The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, reasonable attorney’s fees (not to exceed fifteen (15%) of the
balance due and payable), whether or not action be instituted hereon, and costs
of foreclosure and costs of trial and appellate proceedings.

In the event of any default by the Borrower(s) hereunder, Holder at its sole
option, may charge the Borrower(s) the highest interest rate allowed by law
and/or pursue any and all remedies available to it under applicable law.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given upon depositing same in any U.S. post office, postage prepaid, addressed
to Borrower(s) at the address stated below, or to such other address as
Borrower(s) may designate by written notice to the Holder. Any notice to the
Holder shall be given by mailing such notice by certified mail, return receipt
requested, to the Holder at the address stated in the first paragraph of this
Note, or at such other address as may have been designated by written notice to
Borrower(s). Any notice provided for in this Note shall be deemed to have been
given to Borrower(s) or the Holder when given in the manner herein designated.

THIS NOTE SHALL BE GOVERNED BY, CONSTRUED UNDER AND INTERPRETED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MISSOURI AND THE COURTS OF THE STATE OF
MISSOURI IN THE COUNTY OF TANEY SHALL BE THE EXCLUSIVE COURTS OF JURISDICTION
AND VENUE FOR ANY LITIGATION OR OTHER PROCEEDING THAT MAY BE BASED ON, ARISE OUT
OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, UNLESS OTHERWISE REQUIRED BY LAW.
HOLDER AND BORROWER(S) HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON,
OR ARISING OUT OF, UNDER OR IN CONJUNCTION WITH THIS NOTE, OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF
ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR HOLDER EXTENDING THE LOAN
EVIDENCED BY THIS NOTE.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

Time is of the essence in the performance of each and every obligation
represented by this Note.

 

BORROWER’S ADDRESS:    Borrower/Purchaser signs here    Borrower/Purchaser signs
here    Borrower/Purchaser signs here    Borrower/Purchaser signs here

(Execute Original Only)

 

443996-2 (07.02.09)

--------------------------------------------------------------------------------

MISSOURI SAMPLE (MVC)

UPON CLOSING OF THE PURCHASE TO WHICH THIS DEED OF TRUST APPLIES, THE
UNDERSIGNED HEREBY AUTHORIZE(S) CLOSING AGENT TO COMPLETE THIS DEED OF TRUST BY
INSERTING THE APPROPRIATE DATE OF THE DEED OF TRUST AND TO COMPLETE, AS
NECESSARY, THE RECORDING INFORMATION RELATING TO THE DOCUMENTS BY WHICH THE
TIMESHARE ESTATE(S) BEING ENCUMBERED BY THIS DEED OF TRUST WAS (WERE) CREATED.

DEED OF TRUST

THIS DEED OF TRUST is made and entered into on this              day of
            , 20     , between             , (herein “Borrower(s)”), as
Grantors, whose post office address is c/o Marriott Resorts Hospitality
Corporation, P. O. Box 8038, Lakeland, Florida 33802, County of Polk, State of
Florida, and Hogan Land Title Co., as Trustee, whose address is 1605 E. Sunshine
Street, Springfield, Missouri 65804, and MARRIOTT OWNERSHIP RESORTS, INC., a
Delaware corporation, the address of which is Post Office Box 8038, Lakeland,
Florida 33802 (said party, its successors and assigns is herein called
“Lender”), as Beneficiary.

WITNESSETH, That the said Borrower, in consideration of the debt and trust
hereinafter mentioned and created, and the sum of One Dollar to it paid by the
said Trustee, the receipt of which is hereby acknowledged does by these
presents, grant, bargain and sell, convey and confirm unto the said Trustee the
following described real estate, situate, lying and being in the County of Taney
and State of Missouri, to wit:

Unit Week              in Unit             , Unit Week              in Unit
            

Unit Week              in Unit             , Unit Week              in Unit
            

Unit Week              in Unit             , Unit Week              in Unit
            

of HAB Condominium, according to the Declaration of Condominium thereof,
recorded in Official Records Book 389 at Page 670 in the Public Records of Taney
County, Missouri, and any amendments thereof. (“Declaration”).

To Have and to Hold unto the Trustee, and to his successor or successors in this
trust and to him and his grantees and assigns, forever the same together with
all easements, rights, appurtenances, rents, royalties, mineral, oil and gas
rights and profits, water, water rights, and water stock, and all fixtures now
or hereafter attached to the property, all of which, including replacements and
additions thereto, shall be deemed to be and remain a part of the property
covered by this Deed of Trust; and all of the foregoing, together with said
property are herein referred to as the “Property”. In trust, however, for the
following purpose:

WHEREAS, Borrower(s) has/have this day made, executed and delivered to the said
Beneficiary Borrower(s) promissory note of even date herewith (herein “Note”),
by which Borrower promise(s) to pay to the said Beneficiary or order for value
received              Dollars.

NOW THEREFORE, If the said Borrower(s), or anyone for Borrower(s) shall well and
truly pay off and discharge the debt and interest expressed in the said Note and
every part thereof, when the same shall become due, which Borrower(s) agree(s)
to do, and payable according to the true tenor, date and effect of said Note and
pay, when due, all taxes and assessments, general and special, hereafter levied
or charged upon such land and improvement, and keep the covenants herein
contained; and shall keep the improvements on the land continuously insured in
some insurance company, to the satisfaction of Lender in the sum of reasonable
Dollars, and the policies therefor assigned and delivered to Lender, and keep
said lands and improvements clear of all statutory lien claims of any kind until
said indebtedness is paid, all as more fully set forth herein, THEN THIS DEED,
shall be void, and the property hereinbefore conveyed shall be released at the
cost of the said Borrower(s); but should the Borrower(s) fail or refuse to pay
the said debt and interest, or any part thereof, when the same or any part
thereof shall become due and payable, according to the true tenor and effect of
said Note or to pay any of said taxes, or effect such insurance, or discharge
such statutory lien claims, then the holder of said indebtedness, or any part
thereof, may pay the same, with the sums so paid bearing interest at the highest
rate permissible under applicable law, and being a charge upon said

 

444120-3 (01.06.10)

1

--------------------------------------------------------------------------------

premises and being secured by this deed, and upon any such failure or refusal,
or upon any breach of any covenant herein contained, expressed or implied, this
deed shall remain in full force; and at the option of the holder of said
indebtedness, or any part thereof, the whole of said indebtedness shall, without
notice to the Borrower(s), become due and payable forthwith, and the said
Trustee, or in case of his absence, death or refusal to act, or disability in
anywise, when any advertisement and sale are to be made hereunder, then whoever
shall be sheriff of Taney County, Missouri, at the time such advertisement and
sale are to be made, (who shall thereupon for the purposes of that advertisement
and sale succeed to the Trustee’s title to said real estate and the trust herein
created respecting same) may proceed to sell the property hereinbefore described
or any part thereof, at public venue to the highest bidder, at the front door at
which sheriff’s sales are usually made, of the Taney County Court House, in the
County of Taney, at Forsyth, Missouri, for cash, first giving twenty (20) days’
notice of the time, terms and place of sale, and of the property to be sold, by
advertisement in some newspaper printed and published in said county, and upon
such sale shall execute and deliver a deed in fee simple of the property sold to
the purchaser or purchaser(s) thereof, and receive the proceeds of said sale;
and any statement of facts or recitals by the said Trustee, or any person
assuming to act as successor to him, in relation to the non-payment of the money
secured or agreed to be paid or default in or breach of any condition, covenant,
or agreement herein, the advertisement, sale, receipt of the money, appointment
as successor or happening of any fact preliminary to the succession as trustee
of such person, shall be received as prima facie evidence of such facts and such
trustee shall out of the proceeds of said sale, pay, first, the costs and
expenses of executing this trust, including legal compensation to the Trustee
for his services, and an attorney’s fee of reasonable dollars, which shall be
immediately due upon first publication of sale aforesaid; and next he shall
apply the proceeds remaining over to the payment of taxes, insurance and
statutory lien claims paid by the holders of said indebtedness, and interest
thereon, as aforesaid; and next to the payment of said debt and interest, or so
much thereof as remains unpaid; and the remainder, if any, shall be paid to the
said Borrower(s), or Borrower(s) legal representatives; and in case any suit is
instituted for the foreclosure of this Deed of Trust will pay reasonable dollars
as attorney’s fees which shall also be payable upon institution of said suit,
and that a decree and judgment may be rendered for the payment of said sum out
of the proceeds of sale upon foreclosure, or otherwise, in addition to the
taxable costs of such suits. And upon default in the performance of the
agreements herein, or payment of any monies hereby secured, in case of
foreclosure by suit, by the holder of said indebtedness, or any part thereof, a
receiver to take possession of and collect the rents and profits of said lands
shall be appointed as a matter of right, at the instance of holder or holders of
said indebtedness or any part thereof.

And it is further provided and agreed that without such death, absence, refusal
or inability to act, of said Trustee, Lender, or any legal holder of said
principal Note or Notes, or the attorney in fact of either of them, may by
writing, signed and acknowledged, with or without the consent of the Trustee,
and at any time appoint a successor other than said sheriff, to said Trustee in
his stead or place, who shall thereupon become vested with all the estate,
interest, power and rights in or concerning said lands or property, or any part
thereof, by this deed granted to or vested in said Trustee.

And it is further agreed that said Trustee or successor may sell or convey said
property under the power aforesaid, although he or such successors has been, may
now be, or may hereafter at any time be, the agent or attorney of Lender or the
holder of said Notes and all right or equity or redemption shall upon such sale
cease and be thereby determined notwithstanding said Trustee be such attorney or
agent, and whether the holder of said Notes or some other person be purchaser of
such sale.

And until some default in the condition hereof occurs, the Trustee lets and
demises said premises to the Borrower(s), for which Borrower(s) agrees to pay
the sum of one cent per month. And said Borrower(s) further agree(s) that should
default occur and sale under this deed be made, that upon such sale the said
Borrower, or the then owner of occupant of said property, shall become the
tenant(s) of the purchaser thereat of said property from month to month at a
rental of reasonable dollars per month.

Borrower(s) covenants that Borrower(s) is/are lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant and convey the Property,
that the Property is unencumbered, and that Borrower(s) will warrant and defend
generally the title to the Property against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions
to coverage in any title insurance policy insuring Lender’s interest in the
Property.

In addition, Borrower(s) and Lender further covenant(s) and agree(s) as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower(s)
shall promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by this Deed of Trust.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower(s), Borrower(s) shall pay to Lender on the
day when monthly installments of principal and interest are payable under the
Note, until the Note is paid in full, a sum (herein “Funds”) equal to
one-twelfth of Borrower’s(s’) share of the yearly taxes and assessments relating
to the subject Property encumbered by this Deed of Trust and one-twelfth of the
annual maintenance fee or assessment due under the Declaration (herein
“Condominium Assessments”), or such other amounts or for such other periods
other than monthly, e.g., quarterly or one-fourth, etc., all as reasonably
estimated initially and from time to time by Lender on the basis of assessments
and bills and reasonable estimates thereof.

        If Lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, and Condominium
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower(s) interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower(s) any interest on earnings on the Funds.
Lender shall give to Borrower(s), without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes for which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Deed of Trust.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Condominium Assessments shall exceed the amount required to pay such taxes,
assessments, and Condominium Assessments as

 

444120-3 (01.06.10)

2

--------------------------------------------------------------------------------

they fall due, such excess shall be, at Borrower’s(s’) option, either promptly
repaid to Borrower(s) or credited to Borrower(s) on monthly installments of
Funds. If the amount of the Funds held by Lender shall not be sufficient to pay
taxes, assessments, and Condominium Assessments as they fall due, Borrower(s)
shall pay to Lender any amount necessary to make up the deficiency within thirty
(30) days from the date of a notice mailed by Lender to Borrower(s) requesting
payment thereof, but in no event shall Lender require payment in advance for
taxes and assessments to be held and disbursed as set forth hereunder in an
amount which exceeds the estimate of the next year’s amount for same.

Upon payment in full of all sums secured by this Deed of Trust, Lender shall
promptly refund to Borrower(s) any Funds held by Lender. If under Paragraph 18
hereof the Property is sold or the Property is otherwise acquired by Lender,
Lender shall apply, no later than immediately prior to the sale of the Property
or its acquisition by Lender, any Funds then held by Lender as a credit against
the sums secured by this Deed of Trust.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and Paragraphs 1 and 2 hereof shall
be applied by Lender first in payment of amounts payable to Lender by
Borrower(s) under Paragraph 2 hereof, then against advances, if any, made by
Lender pursuant to Paragraph 7 hereof, then to costs, fees, expenses and other
amounts incurred and advanced by the Lender in the enforcement of its rights
under the Note and this Deed of Trust, including, without limitation, costs and
reasonable attorneys’ fees, then to unpaid service fees, then to interest
payable on the Note, then to the principal of the Note, then to unpaid late
charges, if any, then to interest on any Future Advances made at Lender’s option
pursuant to Paragraph 20 hereof, and then to principal of Future Advances, if
any, made at Lender’s option pursuant to Paragraph 20 hereof.

4. Charges; Liens. Borrower(s) shall promptly pay, when due, all Condominium
Assessments imposed by HAB Condominium Association, Inc. or other governing body
of HAB Condominium (the “Condominium Association”) pursuant to the provisions of
the Declaration, Bylaws, Rules and Regulations or other constituent documents of
HAB Condominium.

Borrower(s) shall pay all taxes, assessments and other charges, fines and
impositions attributable to the Property which may attain a priority over this
Deed of Trust, in the manner provided under Paragraph 2 hereof or, if not paid
in such manner, by Borrower(s) making payment, when due, directly to the payee
thereof. Borrower(s) shall promptly furnish to Lender all notices of amounts due
under this Paragraph, and in the event Borrower(s) shall make payment directly,
Borrower(s) shall promptly furnish to Lender receipts evidencing such payments.
Borrower(s) shall promptly discharge any lien which has priority over this Deed
of Trust; provided, that Borrower(s) shall not be required to discharge any such
lien so long as Borrower(s) shall agree in writing to the payment of the
obligation secured by such lien in a manner acceptable to Lender and, if
requested by Lender, immediately post with Lender an amount necessary to satisfy
said obligation, or shall in good faith contest such lien by, or defend
enforcement of such lien in, legal proceedings which operate to prevent the
enforcement of the lien or forfeiture of the Property or any part thereof and,
if requested by Lender, immediately post with Lender an amount necessary to
satisfy said obligation.

5. Hazard Insurance. Borrower(s) shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Deed of Trust.
This obligation shall be deemed satisfied so long as the Condominium Association
maintains a “master” or “blanket” policy in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower(s) or
the Condominium Association subject to approval by Lender; provided, that such
approval shall not be unreasonably withheld. If required, all premiums on
insurance policies shall be paid in the manner provided under Paragraph 2
hereof, or, if not paid in such manner, by Borrower(s) or the Condominium
Association making payment, when due, directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower(s) shall give Lender prompt notice of any lapse
in hazard insurance coverage. In the event of loss, Borrower(s) shall give
prompt notice to the insurance carrier and Lender. Lender may make proof of loss
if not made promptly by Borrower(s).

Pursuant to the terms of the Declaration, insurance proceeds shall be applied to
restoration or repair of the Property damaged, whether the Unit or the Common
Elements. To the extent such insurance proceeds exceed the cost of such
restoration or repair and the Board of Directors of the Condominium Association
decides to disburse such excess, Borrower’s(s’) share of such excess shall be
applied to the sums secured by this Deed of Trust, with the excess, if any, paid
to Borrower(s).

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not exceed or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments. If under Paragraph 18 hereof the Property is
acquired by Lender, all right, title and interest of Borrower(s) in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to Lender to
the extent of the sums secured by this Deed of Trust immediately prior to such
sale or acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower(s) shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower(s) shall perform all of Borrower’s(s’)
obligations under the Declaration, the Bylaws and Rules and Regulations of the
Condominium Association, and constituent documents. Borrower(s) shall take such
actions as may be reasonable to insure that the Condominium Association
maintains a public liability insurance policy acceptable in form, amount, and
extent of coverage to Lender. If a Condominium rider is executed by Borrower and
recorded together with the Deed of Trust, the covenants and agreements of such
rider shall be incorporated into and amend and supplement the covenants and
agreements of this Deed of Trust as if the rider were a part hereof.

 

 

444120-3 (01.06.10)

3

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7. Protection of Lender’s Security. If Borrower(s) fail(s) to perform the
covenants and agreements contained in this Deed of Trust, or if any action or
proceeding is commenced which materially affects Lender’s interest in the
Property, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankrupt or decedent,
then Lender at Lender’s option, upon notice to Borrower(s), may make such
appearances, disburse such sums and take such action as is necessary to protect
Lender’s interest, including, but not limited to, disbursement of funds to pay
reasonable attorneys’ fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this Paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower(s) secured by this
Deed of Trust. Unless Borrower(s) and Lender agree to other terms or payment,
such amount shall be payable upon notice from Lender to Borrower(s) requesting
payment thereof, and shall bear interest from the date of disbursement at the
rate payable from time to time on outstanding principal under the Note unless
payment of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this Paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Property, provided that Lender shall give Borrower(s) notice
prior to any such inspection specifying reasonable cause therefor related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower(s) in connection with any condemnation or
other taking of all or any part of the Property, whether of the unit or the
common elements or for any conveyance in lieu of condemnation, pursuant to the
terms of the Declaration, are hereby assigned and shall be paid to Lender as
provided hereunder.

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in Paragraphs 1 and 2 hereof or change the
amount of such installments.

10. Borrower(s) Not Released. Extension of the time for payment or modification
of amortization of the sums secured by this Deed of Trust granted by Lender to
any successor in interest of Borrower(s) shall not operate to release, in any
manner, the liability of the original Borrower(s) and Borrower’s(s’) successors
in interest. Lender shall not be required to commence proceedings against such
successor or refuse to extend time for payment or otherwise modify amortization
of the sums secured by this Deed of Trust by reason of any demand made by the
original Borrower(s) and Borrower’s(s’) successors in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Deed of Trust.

12. Remedies Cumulative. All remedies provided in this Deed of Trust are
distinct and cumulative to any other right or remedy under this Deed of Trust or
afforded by law or equity, and may be exercised concurrently, independently or
successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of Paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower(s). All covenants and
agreements of Borrower(s) shall be joint and several. The captions and headings
of the paragraphs of this Deed of Trust are for convenience only and are not to
be used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower(s) provided for in this Deed of Trust
shall be given by mailing such notice by U.S. Mail, postage prepaid, addressed
to Borrower(s) at the Borrower’s(s’) address as set forth in the Note, or at
such other address as Borrower(s) may designate by notice to Lender as provided
herein, and (b) any notice to Lender shall be given by certified mail, return
receipt requested, to Lender’s address stated herein or to such other address as
Lender may designate by notice to Borrower(s) as provided herein. Any notice
provided for in this Deed of Trust shall be deemed to have been given to
Borrower(s) or Lender when given in the manner designated herein. In the event
of a judicial action to enforce this Deed of Trust, Borrower(s) hereby agree(s)
that any notice required or service of process made incident thereto shall be
sufficient if made to the above address. Borrower(s) may change such address by
giving Lender notice of a change of address in writing to Lender’s address
stated herein.

15. Governing Law; Severability. This Deed of Trust shall be governed by the
laws of the state where the Property is located. In the event that any provision
or clause of this Deed of Trust or the Note conflicts with applicable law, such
conflict shall not affect other provisions of this Deed of Trust or the Note
which can be given effect without the conflicting provision, and to this end the
provisions of the Deed of Trust and the Note are declared to be severable.

16. Borrower’s(s’) Copy. Borrower(s) shall be furnished a copy of the Note and
of this Deed of Trust at the time of execution or after recordation hereof.

17. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold (or leased with an option to purchase) or
transferred by Borrower(s) without Lender’s prior written consent, excluding
(a) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, (b) the grant of any leasehold interest of three (3) years or less
not containing an option to purchase, or (c) the creation of a lien or
encumbrance subordinate to this Deed of Trust, Lender may, at Lender’s option,
declare all the sums secured by this Deed of Trust to be immediately due and
payable. Lender shall have waived such option to accelerate if, and only if,
prior to the sale or transfer, Lender and the person to whom the Property is to
be sold or transferred reach agreement in writing that the credit of such person
is satisfactory to Lender and that the interest payable on the sums secured by
this Deed of Trust shall be at such rate as Lender shall request. If Lender has
waived the option to accelerate provided

 

444120-3 (01.06.10)

4

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in this Paragraph 17, and if Borrower’s(s’) successor in interest has executed a
written assumption agreement accepted in writing by Lender, Lender shall release
Borrower(s) from all obligations under this Deed of Trust and the Note.

If Lender exercises such option to accelerate, Lender shall mail Borrower(s)
notice of acceleration in accordance with Paragraph 14 hereof. Such notice shall
provide a period of not less than fifteen (15) days from the date the notice is
mailed within which Borrower(s) may pay the sums declared due. If Borrower(s)
fails to pay such sums prior to the expiration of such period, Lender may,
without further notice or demand on Borrower(s), invoke any remedies permitted
by Paragraph 18 hereof.

18. Acceleration; Remedies. Except as provided in Paragraph 17 hereof, upon
Borrower’s(s’) breach of any covenant or agreement of Borrower(s) in this Deed
of Trust, including the covenants to pay when due any sums secured by this Deed
of Trust, Lender prior to acceleration shall mail notice to Borrower(s) as
provided in Paragraph 14 hereof specifying: (1) the breach; (2) the action
required to cure such breach; (3) a date, not less than fifteen (15) days from
the date the notice is mailed to Borrower(s), by which such breach must be
cured; and (4) that failure to cure such breach on or before the date specified
in the notice may result in acceleration of the sums secured by this Deed of
Trust, foreclosure by power of sale or by judicial proceedings or other
proceedings consistent with the law, and sale of Property. If the breach is not
cured on or before the date specified in the notice, Lender at Lender’s option,
subject to any right of reinstatement to which Borrower(s) is entitled under
applicable law, may declare, without further demand, all of the sums secured by
this Deed of Trust to be immediately due and payable and may foreclose this Deed
of Trust as set forth herein. Lender shall be entitled to collect in such
proceedings all expenses of foreclosure, including, but not limited to,
reasonable attorneys’ fees, court costs, and costs of documentary evidence,
abstracts and title reports.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower(s) hereby assigns to Lender the rents of the Property,
provided that Borrower(s) shall, prior to acceleration under Paragraph 18 hereof
or abandonment of the Property, have the right to collect and retain such rents
as they become due and payable.

Upon acceleration of the Note or abandonment of the Property, Lender shall be
entitled, without notice, to enter upon, take possession of and manage the
Property and to collect the rents of the Property, including those past due. All
rents collected shall be appointed first to payment of the costs of management
of the Property and collection of rents, including, but not limited to,
management fees, court costs, and reasonable attorneys’ fees, and then to the
sums secured by this Deed of Trust. The Lender shall be liable to account only
for those rents actually received. Borrower(s) shall not be entitled to
possession or use of the Property after abandonment or after the Lender has
accelerated the balance due under the Note. Alternatively, Lender may seek the
appointment of a receiver to manage and collect rents from the Property. If a
receiver is appointed, any income from rents from the Property shall be applied
first to the costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower(s), Lender, at Lender’s option,
may make Future Advances to Borrower(s). Such Future Advances, with interest
thereon, shall be secured by this Deed of Trust when evidenced by promissory
notes stating that said notes are secured hereby. At no time shall the principal
amount of the indebtedness secured by this Deed of Trust, not including sums
advanced in accordance herewith to protect the security of this Deed of Trust,
exceed one hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower(s) shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to:

(i) The abandonment or termination of HAB Condominium, except for abandonment or
termination required by law in the case of substantial destruction by fire or
other casualty or in the case of a taking by condemnation or eminent domain;

(ii) any amendment to any provision of the Declaration, ByLaws or Rules and
Regulations of the Condominium Association, or equivalent constituent documents
of HAB Condominium which is for the express benefit of Lender; or

(iii) any action which would have the effect of rendering the public liability
insurance coverage maintained by the Condominium Association unacceptable to
Lender.

22. Attorneys’ Fees. As used in this Deed of Trust and in the Note, “attorneys’
fees” shall include attorneys’ fees, if any, and related costs incurred by
Lender in the enforcement of its rights under the Note and/or Deed of Trust,
whether or not legal action is instituted, and any fees and costs of trial and
appellate proceedings.

23. Venue and Jurisdiction. Borrower hereby consents to the enforcement of the
Note and Deed of Trust in Taney County, Missouri and hereby submits to the
jurisdiction of the courts of the State of Missouri for such purpose.

 

444120-3 (01.06.10)

5

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IN WITNESS WHEREOF, Borrower(s) has/have executed this Deed of Trust on the day
and year first written above.

 

   Borrower    Borrower    Borrower    Borrower

ACKNOWLEDGMENT

 

STATE OF         )            

) ss.

COUNTY OF         )   

On this              day of             , A.D., 20    , before me personally
appeared              to me known to be the person(s) described in and who
executed the foregoing instrument, and acknowledged that he/she/they executed
the same as his/her/their free act and deed.

And the said              further declared himself/herself/themselves to be the
lawful owner(s) of said property in full possession thereof, and as having good
right to mortgage same.

In Testimony Whereof, I have hereunto set my hand and affixed my official seal,
at my office in             , the day and year first above written.

My commission as Notary Public will expire on the              day of
            , 20    .

             Notary Public

Prepared by and return to:    Angela D. McGee

Marriott Ownership Resorts, Inc.

1200 Bartow Road, Suite 10

Lakeland, Florida 33801

 

444120-3 (01.06.10)

6

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NEVADA SAMPLE (MVC)

Upon closing of the purchase to which this Note applies, Borrower(s) hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable interest rate and dates for commencement of payments due hereunder,
the monthly payment date and the final payment date.

PROMISSORY NOTE SECURED BY DEED OF TRUST

Vacation Ownership Interest No.(s):

«VG_BLDG_UNIT_WEEK_SEA_CODE»

Grand Chateau

US $«MTG_AMT»

            , 20    

FOR VALUE RECEIVED, the undersigned (“Borrower(s)”) promise(s) to pay to the
order of MARRIOTT OWNERSHIP RESORTS, INC., (said party or any other party to
whom this Note may be transferred and assigned is hereinafter called the
“Holder”), P.O. Box 24747, Lakeland, Florida 33802, or order, the principal sum
of «MTG_TXT» U.S. Dollars (US $«MTG_AMT»), with interest on the unpaid balance
from the date of this Note, or              (whichever is later), until paid, at
the rate of «RATE_TXT» percent («INT_RATE»%) per annum. Interest shall be
calculated by applying the stated annual rate against the unpaid principal for
the actual number of days principal is outstanding in any calendar year divided
by a 360 day year. Principal and interest shall be payable, without offset, in
lawful money of the United States at the Holder’s address set forth above, or
such other place as the Holder may from time to time designate, in consecutive
monthly installments of «PAY_TXT» U.S. Dollars (US $«PAY_AMT»), beginning on the
             day of              and continuing thereafter on the same day of
each month, with the remaining unpaid balance, together with accrued interest
thereon, due and payable, if not sooner paid, on             .

The indebtedness evidenced by this Note is secured by a Deed of Trust, dated of
even date herewith, creating a lien on the real property described therein (the
“Vacation Ownership Interest(s)”), located in Clark County, Nevada. Reference is
made to the Deed of Trust for rights of the Holder upon acceleration of the
indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a «SFEE» service fee. If any monthly
installment is not received by the Holder within ten (10) days after the date
the installment is due, Borrower(s) shall pay to the Holder a late charge of six
percent (6%) of such late installment or $25.00, whichever is greater. The
Holder may apply any payment received by it to the payment of all late charges
then owing before application to interest or principal. Such late charge is in
addition to and not in lieu of or diminution of any other rights and remedies of
the Holder of this Note.

Each payment made under this Note shall be applied as of its scheduled due date.
Each payment shall be credited on account of amounts due in the order specified
in the Deed of Trust securing this Note.

Borrower(s) may prepay the principal amount outstanding in whole or in part
without a penalty. Any partial prepayment in excess of the amounts then due
shall be applied against the principal amount outstanding but shall not postpone
the due date of any subsequent monthly installments or change the amount of such
installments.

The makers, sureties, guarantors and endorsers hereof severally waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution. This Note shall be the joint and
several obligation of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their respective heirs, personal representatives,
successors and assigns.

 

(VG.NOTE.YZ) 09.04.09

491039-1 (09.04.09)

Borrower(s) Initials:

  

            

  

            

   1   

«CFID» Printed: 9/30/2011

01252010

                                                 

--------------------------------------------------------------------------------

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

 

  a. Failure of Borrower(s) to pay when due any installment payable hereunder
which remains unpaid after a date specified in a notice (not less than fifteen
(15) days from the date such notice is mailed) from the Holder to Borrower(s);

 

  b. The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s);

 

  c. The sale (or lease with option to purchase) or transfer of all or any part
of the Vacation Ownership Interest(s) or any interest therein without the prior
written consent of the Holder, excluding a transfer by devise, descent or by
operation of law upon the death of a joint tenant therein; or

 

  d. Failure of Borrower(s) to comply with the covenants of the Deed of Trust
after notice and failure to cure as provided in the Deed of Trust.

The Holder may exercise its option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, attorney’s fees, whether or not action be instituted hereon.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given after mailing same by U.S. mail, postage prepaid (or such other more
expeditious method as may be appropriate in the case of foreign addresses, as
Holder may choose in its discretion), addressed to Borrower(s) at the address
stated below, or to such other address as Borrower(s) may designate by written
notice to the Holder. Any notice to the Holder shall be deemed to have been
given by mailing such notice by U.S. certified mail, return receipt requested,
(or in the case of a notice originating in a foreign country, by such other
method that results in the Holder acknowledging in writing receipt of the
notice), at the address stated in the first paragraph of this Note, or at such
other address as may be designated by written notice to Borrower(s).

This Note shall be governed by, construed under and enforced in accordance with
the laws of the State of Nevada. Borrower(s) consent(s) to jurisdiction and
venue in the state and federal courts within the State of Nevada.

Borrower(s), and the person executing this Note on behalf of Borrower(s) if
Borrower(s) is not a natural person, has full power and authority to execute
this Note and to bind Borrower(s) hereto without the approval of any third
party.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

Time is of the essence with respect to all provisions of this Note.

 

(VG.NOTE.YZ) 09.04.09

491039-1 (09.04.09)

Borrower(s) Initials:

  

            

  

            

   2   

«CFID» Printed: 9/30/2011

01252010

                                                 

--------------------------------------------------------------------------------

By signing below, Borrower(s) accepts and agrees to the terms, conditions, and
covenants contained in this Note.

 

BORROWER(S) ADDRESS:     BORROWER(S): «ADR1»       

«ADR2»

«CSZ»

    «LEGAL_NAME_1»            «LEGAL_NAME_2»            «LEGAL_NAME_3»         
  «LEGAL_NAME_4»

 

(VG.NOTE.YZ) 09.04.09

491039-1 (09.04.09)

Borrower(s) Initials:

  

            

  

            

   3   

«CFID» Printed: 9/30/2011

01252010

                                                 

--------------------------------------------------------------------------------

NEVADA SAMPLE (MVC)

APN: 162-21-314-002 AND 162-21-314-003

When recorded mail tax statements to:

Marriott Vacation Club International

Property Tax Department

6649 Westwood Boulevard, Suite 500

Orlando, Florida 32821

When recorded mail to:

First American Title Company

1160 North Town Center Drive, Suite 190

Las Vegas, NV 89144

 

 

Space Above This Line for Recorder’s Use

Control No. - «VG_BLDG_UNIT_WEEK_SEA_CODE»

UPON CLOSING OF THE PURCHASE TO WHICH THIS DEED OF TRUST APPLIES, BORROWER
HEREBY AUTHORIZES CLOSING AGENT TO COMPLETE THIS DEED OF TRUST AND THE NOTE AS
PROVIDED FOR IN THE PURCHASE AGREEMENT PURSUANT TO WHICH THE VACATION OWNERSHIP
INTEREST(S) WERE ACQUIRED BY BORROWER.

DEED OF TRUST

(Tower 1 & 2)

This DEED OF TRUST, made                      among the Trustor(s) «LEGAL_NAME»,
«TITLE_TAKEN» herein called “Borrower” (whether one or more), whose address is
«ADR1», «ADR2» «CSZC», FIRST AMERICAN TITLE COMPANY, 1160 North Town Center
Drive, Las Vegas, Nevada 89144, herein called “Trustee,” and the Beneficiary
MARRIOTT OWNERSHIP RESORTS, INC., a Delaware corporation, herein called
“Lender.”

WITNESSETH: That Borrower grants to Trustee in trust, with power of sale, the
Vacation Ownership Interest(s) (hereafter called “Vacation Ownership Interest”
whether one or more) in the County of Clark, State of Nevada, described as:

 

Page 1 of 4

--------------------------------------------------------------------------------

«VG_INT» as identified and established in that certain Record of Survey
«VG_PARCEL_INFO» and Record of Survey constitute a subdivision of a portion of
Lot 1 of that certain Commercial Subdivision created by the Final Map of the
Grand Chateau recorded on May 19, 2004 in Book 117 of Plats, at Page 20,
Official Records of Clark County, Nevada, together with the exclusive right to
use and occupy a Villa configuration during a reserved Use Period, as
established and described in that certain Declaration of Covenants, Conditions,
Easements and Restrictions and Vacation Ownership Instrument for Grand Chateau
dated April 26, 2004, recorded on May 19, 2004, in Book 20040519, Instrument
No. 0004083, in the Official Records of Clark County, Nevada.

The Vacation Ownership Interest purchased is described as follows:

«VG_BLDG_UNIT_WEEK_SEA_CODE»

together with all improvements now or hereafter erected on the Project
associated with the Vacation Ownership Interest, and all easements and all other
rights thereunto belonging or in anyway now or hereafter appertaining, and the
rents, issues and profits thereof, and all fixtures now or hereafter attached
to, used in connection with or hereafter a part of the Project associated with
the Vacation Ownership Interest, and all replacements and additions, subject,
however, to the right, power and authority hereinafter given to and conferred
upon Lender to collect and apply such rents, issues and profits for the purpose
of securing (1) payment of the sum of $«MTG_AMT» with interest thereon according
to the terms of a promissory note or notes of even date herewith made by
Borrower, payable to the order of Lender, and extensions or renewals thereof,
(2) the performance of each agreement of Borrower incorporated by reference or
contained herein and (3) payment of additional sums and interest thereon which
may hereafter be loaned to Borrower, or his successors or assigns, when
evidenced by a promissory note or notes reciting that they are secured by this
Deed of Trust.

To protect the security of this Deed of Trust, and with respect to the Vacation
Ownership Interest above described, Borrower expressly makes each and all of the
agreements, and adopts and agrees to perform and be bound by, and it is mutually
agreed that, each and all of the terms and provisions set forth in the Amended
and Restated Master Form Deed of Trust and Security Agreement recorded on
November 13, 2008, Book 20081113, Instrument Number 0005152 Official Records of
Clark County, Nevada, the county where said property is located, shall inure to
and bind the parties hereto, with respect to the property above described. Said
agreements, terms and provisions are by the within reference thereto,
incorporated herein and made a part of this Deed of Trust for all purposes as
fully as if set forth at length herein, and Lender may charge for a statement
regarding the obligation secured hereby, provided

 

Page 2 of 4

--------------------------------------------------------------------------------

the charge therefor does not exceed the maximum allowed by NRS 107.310 or other
applicable law.

 

Page 3 of 4

--------------------------------------------------------------------------------

The undersigned Borrower, requests that a copy of any notice of default and any
notice of sale hereunder be mailed to Borrower at the address set forth.

 

Signature of Borrower    «LEGAL_NAME_1»    «LEGAL_NAME_2»    «LEGAL_NAME_3»   
«LEGAL_NAME_4»

STATE OF                             )

COUNTY OF                             )

On                  before me,                 , personally appeared         
«LEGAL_NAME_1», «LEGAL_NAME_2», «LEGAL_NAME_3», «LEGAL_NAME_4», personally known
to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.

WITNESS my hand and official seal.

 

Signature:     NOTARY PUBLIC Commission expires:     Commission No.:    

 

Page 4 of 4

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I UNDERSTAND THAT I AM SIGNING THIS NOTE BEFORE THE CLOSING OF THE PURCHASE TO
WHICH THIS NOTE APPLIES. BY SIGNING, I AUTHORIZE THE CLOSING AGENT OR LENDER TO
INSERT THE DATE OF THE NOTE, THE DATE OF MY FIRST PAYMENT, THE MONTHLY PAYMENT
DATE AND THE FINAL PAYMENT DATE.

NEW JERSEY SAMPLE (MVC)

This Mortgage Note is made on                                      BETWEEN the
Borrower(s) «LEGAL_NAME» whose address is «ADR1», «ADR2» «CSZC» referred to as
“I,” AND the Lender Marriott Ownership Resorts, Inc. whose address is Post
Office Box 8038, Lakeland, Florida 33802 referred to as the “Lender.” If more
than one Borrower signs this Note, the word “I” shall mean each Borrower named
above. The word “Lender” means the original Lender and anyone else who takes
this note by transfer.

 

1. Borrower’s Promise to Pay Principal and Interest.

In return for a loan that I received, I promise to pay «MTG_TXT» U.S. Dollars
($«MTG_AMT») (called principal), plus interest to the order of the Lender.
Interest, at a yearly rate of «INT_RATE»%, will be charged on that part of the
principal, which has not been paid from                              until all
principal has been paid.

 

2. Payments.

I will pay principal and interest based on a 360/365 day year payment schedule
with monthly payments of $«PAY_AMT» on the                              day of
each month beginning on                                                      . I
will pay all amounts owed under this Note no later than
                                                     . All payments will be made
to the Lender at the address shown above or to a different place if required by
the Lender. I will include a $5.00 service fee with each monthly payment to
offset the Lender’s administrative costs.

 

3. Early Payments.

I have the right to make payments at any time before they are due. These early
payments will mean that this Note will be paid in less time. However, unless I
pay this Note in full, my monthly payments will remain the same. I may not make
partial payments at any time.

 

4. Late Charges for Overdue Payments.

If the Lender has not received any payment within ten (10) days after its due
date, I will pay the Lender a late charge of 6% of the payment. This charge will
be paid with the late payment, or else it will be deducted from the next
payment.

 

5. Mortgage to Secure Payment.

The Lender has been given a Mortgage dated
                                             , to protect the Lender if the
promises made in this Note are not kept. I agree to keep all promises made in
the Mortgage covering property I own located in Galloway Township, Atlantic
County, State of New Jersey and described as:

Timeshare Estate No.             in Unit«MVDATA1»

of FAIRWAY VILLAS AT SEAVIEW CONDOMINIUM, established by the Master Deed of
Fairway Villas at Seaview Condominium, recorded in the Atlantic County Clerk’s
Office in Book 6473, Page 43, and any amendments to the Master Deed. All terms
of the Mortgage are made part of this Note.

 

6. Default.

If I fail to make any payment required by this Note within fifteen (15) days
after Lender has given me a notice that such payment is due, or if I fail to
keep any other promise I make in this Note or in the Mortgage, or if I file for
bankruptcy, or if another creditor institutes bankruptcy proceedings against me,
then the Lender may declare that I am in default on the Mortgage and this Note.
Upon default, I must immediately pay the full amount of all unpaid principal,
interest, other amounts due on the Mortgage and this Note and the Lender’s costs
of collection, reasonable attorney fees and costs of trial and appeal
proceedings.

 

7. Waivers.

I give up my right to require that the Lender do the following: (a) to demand
payment (called “presentment”); (b) to notify me of nonpayment (called “notice
of dishonor”); and (c) to obtain an official certified statement showing
nonpayment (called a “protest”). The Lender may exercise any right under this

 

FW.NOTE.6.2.99

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Note, the Mortgage or under any law, even if Lender has delayed in exercising
that right or has agreed in an earlier instance not to exercise that right.
Lender does not waive its right to declare that I am in default by making
payments or incurring expenses on my behalf.

 

8. Notice:

I will accept any notice from Lender if it is deposited in any U.S. Post Office,
with postage paid, and addressed to me at the address, which I have indicated at
the top of this Note. I agree to notify Lender in writing if my address changes.
Any notice that I may send to Lender will be mailed certified, return receipt
requested, to Lender at the address indicated at the top of this Note.

 

9. Time.

I acknowledge that the times and dates indicated for my payments to Lender are
to be strictly followed in order for me to complete my obligations under this
Note.

 

10. Each Person Liable.

The Lender may enforce any of the provisions of this Note against any one or
more of the Borrowers who sign this Note.

 

11. No Oral Changes.

This Note can only be changed by an agreement in writing signed by both the
Borrower(s) and the Lender.

 

12. Signatures.

I agree to the terms of this Note. If the Borrower is a corporation, its proper
corporate officers sign and its corporate seal is affixed.

 

13. WAIVER OF JURY TRIAL.

I ACKNOWLEDGE THAT ANY INTERPRETATION OF THIS NOTE WILL BE MADE BY REFERRING TO
THE LAWS OF THE STATE OF NEW JERSEY AND ANY LITIGATION REGARDING THIS NOTE WILL
BE BROUGHT IN THE COURTS OF THE STATE OF NEW JERSEY. LENDER AND I GIVE UP ANY
RIGHT EITHER OF US MAY HAVE TO A TRIAL BY JURY IN ANY LITIGATION RELATING TO
THIS NOTE.

Time is of the essence in the performance of each and every obligation
represented by this Note.

 

       ______________________ (Date) Borrower: «LEGAL_NAME_1»    

 

       Borrower (s) Address: Borrower: «LEGAL_NAME_2»     «ADR1»     «CSZC»

 

         Borrower: «LEGAL_NAME_3»    

 

         Borrower: «LEGAL_NAME_4»    

(Execute Original Only)

DOCUMENTARY STAMP TAXES HAVE BEEN PAID

AND THE PROPER AMOUNTS AFFIXED TO THE MORTGAGE

 

FW.NOTE.6.2.99

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NEW JERSEY SAMPLE (MVC)

(UPON CLOSING OF THE PURCHASE TO WHICH THIS MORTGAGE APPLIES, THE UNDERSIGNED
HEREBY AUTHORIZE(S) CLOSING AGENT TO COMPLETE THIS MORTGAGE BY INSERTING THE
APPROPRIATE DATE OF THE MORTGAGE AND TO COMPLETE, AS NECESSARY, THE RECORDING
INFORMATION RELATING TO THE DOCUMENTS BY WHICH THE TIME-SHARE ESTATE(S) BEING
ENCUMBERED BY THIS MORTGAGE WAS(WERE) CREATED)

MORTGAGE

This Mortgage is made on                                                      

BETWEEN the Borrower(s) «LEGAL_NAME»

whose address is «ADR1», «ADR2», «CSZC»

referred to as “I,”

AND the Lender              Marriott Ownership Resorts, Inc.

whose address is              Post Office Box 8038, Lakeland, Florida 33802

referred to as the “Lender.”

If more than one Borrower signs this Note, the word “I” shall mean each Borrower
named above. The word “Lender” means the original Lender and anyone else who
takes this Note by transfer.

1. MORTGAGE NOTE. In return for a loan that I received, I promise to pay
$«MTG_AMT»(called “Principal”), plus interest in accordance with the terms of a
Mortgage Note dated                                                      
(referred to as the “Note”). The Note provides for monthly payments of $
«PAY_AMT» and a yearly interest rate of «INT_RATE» %. All sums owed under the
Note are due no later than                                              . All
terms of the Note are made part of this Mortgage.

2. PROPERTY MORTGAGED. The property mortgaged to the Lender (called the
“Property”) is located in the Galloway Township of Atlantic County of the State
of New Jersey and described as follows:

Timeshare Estate No.      in Unit«MVDATA1»

of FAIRWAY VILLAS AT SEAVIEW CONDOMINIUM, established by the Master Deed of
Fairway Villas at Seaview Condominium, recorded in the Atlantic County Clerk’s
Office in Book 6473, Page 43, (referred to as the “Master Deed”) and any
amendments to the Master Deed.

3. RIGHTS GIVEN TO LENDER. I mortgage the Property to the Lender. This means
that I give the Lender those rights stated in this Mortgage and also those
rights the law gives to Lenders who hold mortgages on real property. When I pay
all amounts due to the Lender under the Note and this Mortgage, the Lender’s
rights under this Mortgage will end. The Lender will then cancel this Mortgage
at my expense.

4. PROMISES. I make the following promises to the Lender:

a. NOTE AND MORTGAGE. I will comply with all of the terms of the Note and this
Mortgage.

b. PAYMENTS. I will make all payments required by the Note and this Mortgage,
including the reasonable service charges of Lender for servicing my loan
account.

c. OWNERSHIP. I warrant title to the premises (N.J.S.A. 46:9-2). This means I
own the Property and will defend my ownership against all claims.

d. LIENS, TAXES, AND ASSESSMENTS. I will pay all liens, taxes, assessments and
other government charges made against the Property when due. I will pay the
annual maintenance fee or assessment due under the Master Deed, referred to as
“Condominium Assessments”. I will not claim any deduction from the taxable value
of the Property because of this Mortgage. I will not claim any credit against
the Principal and interest payable under the Note and this Mortgage for any
taxes paid on the Property.

e. INSURANCE. I must maintain extended coverage insurance on the Property to
protect against losses by fire or other hazards. The Lender may also require
that I maintain flood insurance or other types of insurance. The insurance
companies, policies, amounts, and types of coverage must be acceptable to the
Lender. I will notify the Lender in the event of any substantial loss or damage.
The Lender may then settle the claim on my behalf if I fail to do so. All
payments from the insurance company must be payable to the Lender under a
“standard mortgage clause” in the insurance policy. The Lender may use any
proceeds to repair and restore the Property or to reduce the amount due under
the Note and this Mortgage. This will not delay the due date for any payment
under the Note and this Mortgage. My obligation to maintain extended coverage
insurance will be satisfied if the Condominium Association maintains a “blanket”
policy on the Property.

f. REPAIRS. I will keep the Property in good repair, neither damaging nor
abandoning it. I will allow the Lender to inspect the Property upon reasonable
notice to me.

g. STATEMENT OF AMOUNT DUE. Upon the request of the Lender, I will certify to
the Lender in writing:

(a) the amount due on the Note and this Mortgage, and

(b) whether or not I have any defense to my obligations under the Note and this
Mortgage.

h. CONDOMINIUM. I will perform all obligations required of me under the Master
Deed, as well as under the certificate of incorporation, the by-laws and the
regulations of the Fairway Villas at Seaview Condominium Association, Inc.,
referred to as “Condominium Association”.

i. LAWFUL USE. I will use the Property in compliance with all laws, ordinances
and other requirements of any governmental authority.

j. CONDOMINIUM ASSESSMENTS. I will pay all Condominium Assessments imposed by
the Condominium Association.

5. EMINENT DOMAIN. All or part of the Property may be taken by a government
entity for public use. If this occurs, I agree that any compensation be given to
the Lender. The Lender may use this to repair and restore the Property or to
reduce the amount owed on the Note and Mortgage. This will not delay the due
date for any further payment under the Note and this Mortgage. Any remaining
balance will be paid to me.

6. TAX, INSURANCE AND ASSESSMENT ESCROW. If the Lender requests, I will make
regular monthly payments to the Lender of a sum (herein “Funds”) equal to:
(a) 1/12 of the yearly real estate taxes and assessments on the Property; and
(b) 1/12 of the annual condominium Assessment due for the Property, all of which
Funds have been reasonably estimated by Lender. These Funds will be held by the
Lender without interest to pay the taxes, assessments, and Condominium
Assessments as they become due. Upon my request, Lender will give me an annual
accounting of the Funds, showing payments and disbursements. If the Funds paid
by me exceed the amounts necessary to pay the taxes and Condominium Assessments,
then the excess will, at my option, be returned to me or credited against my
next monthly installment of the Funds. If the amount of Funds paid by me is not
sufficient to pay the taxes and Condominium Assessments, I will pay to Lender
any amount necessary to make up the difference within thirty (30) days of
Lender’s request to me. When the entire Principal of the Note is paid by me, the
Lender will return any remaining Funds to me. If the Property is sold under a
foreclosure, as described in Paragraph 11(c), or is acquired by Lender, Lender
will apply any Funds held by it against the amounts due under this Mortgage.

7. PAYMENTS MADE FOR BORROWER. If I do not make all of the repairs or payments
as agreed in this Mortgage, the Lender may do so for me. The cost of these
repairs and payments will be added to the Principal, will bear interest at the
same rate provided in the Note and will be repaid to the Lender upon demand.

 

(fw.mort) 09.16.05

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8. APPLICATION OF PAYMENT. All payments made by me under the Note and this
Mortgage will be applied by Lender in the following order:

 

  (i) Escrow for taxes, insurance and Condominium Assessments;

 

  (ii) Payments made by Lender under Paragraph 7;

 

  (iii) Loan Service fees;

 

  (iv) Late charges, if any;

 

  (v) Costs and expenses paid by Lender because of any default by me;

 

  (vi) Interest under the Note; and

 

  (vii) Principal of the Note.

9. DEFAULT. The Lender may declare that I am in default on the Note and this
Mortgage if:

 

  a. I fail to make any payment required by the Note and this Mortgage within
five (5) days after its due date;

 

  b. I fail to keep any other promise I make in this Mortgage;

 

  c. the ownership of the Property is changed for any reason;

 

  d. the holder of any lien on the Property starts foreclosure proceedings; or

 

  e. bankruptcy, insolvency or receivership proceedings are started by or
against any of the Borrowers.

10. PAYMENTS DUE UPON DEFAULT. If the Lender declares that I am in default, and
I fail to correct the default within fifteen (15) days after Lender gives me
written notice and an explanation of the default, I must immediately pay the
full amount of all unpaid Principal, interest, other amounts due on the Note and
this Mortgage and the Lender’s costs of collection and reasonable attorney fees.

11. LENDER’S RIGHTS UPON DEFAULT. If the Lender declares that the Note and this
Mortgage are in default, the Lender will have all rights given by law or set
forth in this Mortgage. This includes the right to do any one or more of the
following:

 

  a. take possession of and manage the Property, including the collection of
rents and profits;

 

  b. have a court appoint a receiver to accept rent for the Property (I consent
to this);

 

  c. start a court action, known as foreclosure, which will result in a sale of
the Property to reduce my obligations under the Note and this Mortgage; and

 

  d. sue me for any money that I owe the Lender.

12. NOTICES. All notices must be in writing and personally delivered or sent by
certified mail, return receipt requested, to the address given in this Mortgage.
Address changes may be made upon notice to the other party.

13. NO WAIVER BY LENDER. Lender may exercise any right under this Mortgage or
under any law, even if Lender has delayed in exercising that right or has agreed
in an earlier instance not to exercise that right. Lender does not waive its
right to declare that I am in default by making payments or incurring expenses
on my behalf.

14. EACH PERSON LIABLE. This Mortgage is legally binding upon each Borrower and
all who succeed to their responsibilities (such as heirs and executors). The
Lender may enforce any of the provisions of the Note and this Mortgage against
any one or more of the Borrowers who sign this Mortgage.

15. NO ORAL CHANGES. This Mortgage can only be changed by an agreement in
writing signed by both the Borrower(s) and the Lender.

16. BORROWER’S COPY. I understand that I will be given a copy of the Note and
this Mortgage either when I sign it or after the Mortgage has been recorded.

17. LENDER’S PRIOR CONSENT. Unless I have received the prior written consent of
Lender, I will not divide my interest in the Property or consent to: (i) the
termination of Fairway Villas at Seaview Condominium; or (ii) any amendment to
the Master Deed or the certificate of incorporation, the by-laws and the
regulations of the Condominium Association; or (iii) any action that might make
the public liability insurance maintained by the Condominium Association
unacceptable to Lender.

18. ATTORNEY’S FEES. The term “attorney’s fees” includes any attorney’s fees and
related costs paid by Lender if it has to enforce any of its rights under the
Note or this Mortgage, even if a legal action has not been filed.

19. SIGNATURES. I agree to the terms of this Mortgage. If the Borrower is a
corporation, its proper corporate officers sign and its corporate seal is
affixed.

IN WITNESS WHEREOF, Borrower(s) has/have executed this Mortgage on the day and
year first written above. Signed in the presence of:

 

          Borrower/Mortgagor: «LEGAL_NAME_1»     Date

 

          Borrower/Mortgagor: «LEGAL_NAME_2»     Date

 

          Borrower/Mortgagor: «LEGAL_NAME_3»     Date

 

          Borrower/Mortgagor: «LEGAL_NAME_4»     Date

ACKNOWLEDGMENT

STATE OF                                                      , COUNTY OF
                                                              SS.

I CERTIFY that on                                                  ,
«LEGAL_NAME»

personally came before me and stated to my satisfaction that this person (or if
more than one, each person):

(a) was the maker of the attached instrument; and,

(b) executed this instrument as his or her own act

 

  Print Name:     NOTARY PUBLIC My Commission Expires: Commission No.:

 

(fw.mort) 09.16.05

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ADDITIONAL ACKNOWLEDGMENT

STATE OF                                                      , COUNTY OF
                                                          SS.

I CERTIFY that on                                                          ,
«LEGAL_NAME»

personally came before me and stated to my satisfaction that this person (or if
more than one, each person):

(a) was the maker of the attached instrument; and,

(b) executed this instrument as his or her own act.

 

  Print Name:     NOTARY PUBLIC My Commission Expires: Commission No.:

STATE OF                                                      , COUNTY OF
                                                          SS.

I CERTIFY that on                                                      ,
«LEGAL_NAME»

personally came before me and stated to my satisfaction that this person (or if
more than one, each person):

(a) was the maker of the attached instrument; and,

(b) was authorized to and did execute this instrument as
                             of                                          
           , the entity named in this instrument.

 

  Print Name:     NOTARY PUBLIC My Commission Expires: Commission No.:

 

MORTGAGE       Dated:      Borrower(s)     

to

      Record and Return to:     

Lender(s)

   Angela McGee       Marriott Resorts Title Company, Inc.       P.O. Box 24747
      Lakeland, Florida 33802

To the County Recording Officer of                                          
                County:

this Mortgage is fully paid. I authorize you to cancel it of record.

 

Dated: ____________________

       (Seal)    Lender  

 

(fw.mort) 09.16.05

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SOUTH CAROLINA SAMPLE (MVC)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable dates for commencement of payments due hereunder, the monthly payment
date and the final payment date.

PROMISSORY NOTE

 

Time Sharing Interest No.(s): «CFID»    SurfWatch Horizontal Property Regime US$
«MTG_AMT»    ______________________, __________

FOR VALUE RECEIVED, the undersigned «LEGAL_NAME» (“Borrower(s)”) promise(s) to
Pay to the order of MARRIOTT OWNERSHIP RESORTS, INC., (said party or any other
party to whom Marriott Ownership Resorts, Inc. may transfer and assign this Note
and who holds this Note from time to time is hereinafter called the “Holder”),
Post Office Box 24747, Lakeland, Florida 33802, or order, the principal sum of
«MTG_TXT» U.S. Dollars (US $«MTG_AMT»), with interest on the unpaid balance from
the date of this Note or                                              
(whichever is later), until paid, at the rate of «RATE_TXT» percent per annum
(«INT_RATE»%) (based on a 360-day year and on the actual number of days
elapsed). Principal and interest shall be payable in lawful money of the United
States at the Holder’s address set forth above, or such other place as the
Holder may, from time to time, designate, in consecutive monthly installments of
«PAY_TXT» U.S. Dollars (US $«PAY_AMT»), on the          day of each month and
continuing thereafter on the same day of each month beginning
                                             , for a period of «NO_PAY» months
with the remaining unpaid principal balance, together with accrued interest
thereon, due and payable, if not sooner paid, on
                                                     .

The indebtedness evidenced by this Note is secured by a Mortgage, dated of even
date herewith, creating a lien on the real property described therein (the
“Property”). Reference is made to said Mortgage for rights as to acceleration of
the indebtedness evidenced by this Note.

Each monthly payment shall be tendered with a «SFEE» service fee.

Borrower(s) shall pay to the Holder a late charge of six percent (6%) for any
monthly installment not received by the Holder within ten (10) days after the
date the installment is due. The late charge will be deducted from the next
payment received.

Each payment shall be credited first to amounts due pursuant to Paragraph 2 of
the Mortgage, then to advances, if any, made by the Lender (as defined in the
Mortgage) pursuant to Paragraph 7 of the Mortgage, then to the costs, fees,
expenses and other amounts incurred and advanced by the Holder in the
enforcement of its rights hereunder, including, without limitation, costs and
reasonable attorney’s fees described below, then to unpaid service fees, then to
interest due hereunder, then to principal due hereunder, then to unpaid late
charges, if any, then to interest on any Future Advances made pursuant to
Paragraph 20 of the Mortgage, and then to principal of any Future Advances made
pursuant to Paragraph 20 of the Mortgage.

Borrower(s) may prepay the principal amount outstanding in whole or in part. Any
partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Presentment, notice of dishonor, and protest are hereby waived by all makers,
sureties, guarantors and endorsers hereof. This Note shall be joint and several
obligation of all makers, sureties, guarantors and endorsers, and shall be
binding upon them and their heirs, personal representatives, successors and
assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

 

  (a) Failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  (b) failure of Borrower(s) to perform any other covenant or agreement of
Borrower(s) in this Note or the Mortgage within fifteen (15) days after the
mailing of notice from the Holder to the Borrower(s) specifying the nature of
such failure; and

 

  (c) the insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s).

 

(SF.NOTE.YZ) 10.08.09

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      v02012010

 

Borrower(s) Initials

                               

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The Holder may exercise this option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, reasonable attorney’s fees, whether or not action be instituted
hereon.

Except for the notice required pursuant to the default for failure to make
monthly payments outlined in Subparagraph (a) above, any notice to Borrower(s)
provided for in this Note shall be deemed to have been given after depositing
same in any U.S. post office, postage prepaid, addressed to Borrower(s) at the
address stated below, or to such other address as Borrower(s) may designate by
written notice to the Holder. Such address shall also serve as the Borrower’s
official “notice” address for purposes of the non-judicial foreclosure
provisions set forth in the Mortgage referenced above. Any notice to the Holder
or to the Borrower(s) for defaults relating to non-payment of monthly payments
shall be given by mailing such notice by certified mail, return receipt
requested, to the Holder at the address stated in the first paragraph of this
Note, or at such other address as may have been designated by written notice to
Borrower(s) and to the Borrower(s) as stated above. Any notice provided for in
this Note shall be deemed to have been given to Borrower(s) or the Holder when
given in the manner herein designated.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

This Note shall be governed by, construed under and enforced in accordance with
the laws of the state of South Carolina. Borrower(s) consents to jurisdiction
and venue in the state and federal courts of the State of South Carolina.

 

       Borrower(s)’ Address: «LEGAL_NAME_1»     «ADR1»

       «ADR2» «LEGAL_NAME_2»     «CSZ»

         «LEGAL_NAME_3»    

         «LEGAL_NAME_4»    

(Execute Original Only)

 

(SF.NOTE.YZ) 10.08.09

   Page 2 of 2    «CFID» Printed: 9/29/2011

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      v02012010

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SOUTH CAROLINA SAMPLE (MVC)

Upon closing of the purchase to which this Mortgage applies, the undersigned
hereby authorize(s) closing agent to complete this Mortgage by inserting the
appropriate date of the Mortgage and to complete, as necessary, the recording
information relating to the documents by which the Time Sharing Interest(s)
being encumbered by this Mortgage was (were) created.

MORTGAGE

THIS MORTGAGE is made as of                                     ,
                                    , between the Mortgagor(s), «LEGAL_NAME»
(herein “Borrower(s)”), and the Mortgagee, MARRIOTT OWNERSHIP RESORTS, INC., a
Delaware corporation, the address of which is Post Office Box 24747, Lakeland,
Florida 33802 (said party, its successors and assigns is herein called
“Lender”).

TO SECURE to Lender (a) the repayment of the indebtedness evidenced by a
promissory note made by the above-named Borrower(s), payable to Lender in the
principal sum of «MTG_TXT» U.S. Dollars (US$«MTG_AMT»), (herein “Note”),
providing for monthly installments of principal and interest, with the balance
of indebtedness, if not sooner paid, due and payable on
                                        ; (b) the payment of all other sums,
with interest thereon, advanced in accordance herewith to protect the security
of this Mortgage, and the performance of the covenants and agreements of
Borrower(s) herein contained; and (c) the repayment of any future advances, with
interest thereon, made to Borrower(s) by Lender pursuant to Paragraph 20 hereof
(herein “Future Advances”), Borrower(s) does hereby mortgage, grant and convey
to Lender and Lender’s successors and assigns the following described property
located in the County of Beaufort, State of South Carolina:

An undivided «WEEKS_PER_VILLA_52» fractional interest in Unit No. «VILLA_LIST»
respectively, SurfWatch Horizontal Property Regime, lying situate and being in
Hilton Head Island, Beaufort County, South Carolina, and being more particularly
shown and described by reference to the Master Deed, establishing the said
Horizontal Property Regime, being dated June 17, 2004, and recorded in the Land
Records for Beaufort County, South Carolina, on June 22, 2004 in Book 01976 at
Page 0001, as further amended from time to time, the most recent amendment being
the Fourth Amendment to the Master Deed dated April 12, 2006, and recorded
April 17, 2006, in Deed Book 2357 at Page 166 and by reference to that certain
plat entitled “Plat of Phase 1, 2, 3 & 4 SurfWatch Horizontal Property Regime”
said plat prepared by Surveying Consultants, Inc., Terry G. Hatchell, S.C.R.L.S.
#11059 said plat being dated March 29, 2006, and recorded in the Land Records
for Beaufort County, South Carolina, in Plat Book 112 at Page 175, as may be
further revised from time to time.

AND ALSO, all of the rights, privileges, easements, and common areas
appertaining to the above-described property as set forth in the Master Deed and
By-Laws of SurfWatch Horizontal Property Regime.

AND ALSO, all right, title, interest and privileges extending to Time Sharing
Interest Numbers(s) «BLDG_UNIT_WEEK_SEA_CODE» in each of the respective
aforedescribed Units, as contained in that certain Time Sharing Declaration,
dated June 17, 2004, recorded in the Land Records for Beaufort County, South
Carolina, on June 22, 2004 in Book 01976 at Page 0082, as amended from time to
time.

The Property mortgaged herein is the same Property conveyed to the within
Borrower(s) by deed of the Lender dated the date hereof and recorded herewith.

TO HAVE AND TO HOLD unto Lender and Lender’s successors and assigns, forever,
together with all the improvements now or hereafter erected on the property, and
all easements, rights, appurtenances, rents, royalties, mineral, oil and gas
rights and profits, water, water rights, and water stock, and all fixtures now
or hereafter attached to the property, all of which, including replacements and
additions thereto, shall be deemed to be and remain a part of the property
covered by this Mortgage; and all of the foregoing, together with said property
are herein referred to as the “Property”.

Borrower(s) covenants that Borrower(s) is/are lawfully seized of the estate
hereby conveyed and has the right to mortgage, grant and convey the Property,
that the Property is unencumbered, and that Borrower will warrant and defend
generally the title to the Property against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions
to coverage in any title insurance policy insuring Lender’s interest in the
Property.

Borrower(s) and Lender covenant and agree as follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower(s)
shall promptly pay when due the principal of and interest on the indebtedness
evidenced by the Note, late charges as provided in the Note, reasonable service
charges imposed by Lender for servicing the loan account and the principal of
and interest on any Future Advances secured by this Mortgage.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower(s), Borrower(s) shall pay to Lender on the
day when monthly installments of principal and interest are payable under the
Note, until the Note is paid in full, a sum (herein “Funds”) equal to
one-twelfth of Borrower’s share of the yearly taxes and assessments relating to
the subject Property encumbered by this Mortgage and one-twelfth of the annual
maintenance fee or assessment due under the Master Deed and/or Time Sharing
Declaration (herein “Condominium Assessments”), or such other amounts or for
such other periods other than monthly, e.g., quarterly or one-fourth, etc., all
as reasonably estimated initially and from time to time by Lender on the basis
of assessments and bills and reasonable estimates thereof.

If Lender exercises the foregoing right, the Funds shall be held in an
institution the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes, assessments, and Condominium
Assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said assessments and bills,
unless Lender pays to Borrower(s) interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Lender
shall not be required to pay Borrower(s) any interest on earnings on the Funds.
Lender shall give to Borrower(s), without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes for which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Mortgage.

 

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If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes, assessments, and
Condominium Assessments shall exceed the amount required to pay such taxes,
assessments, and Condominium Assessments as they fall due, such excess shall be,
at Borrower’s option, either promptly repaid to Borrower(s) or credited to
Borrower(s) on monthly installments of Funds. If the amount of the Funds held by
Lender shall not be sufficient to pay taxes, assessments, and Condominium
Assessments as they fall due, Borrower(s) shall pay to Lender any amount
necessary to make up the deficiency within thirty (30) days from the date of a
notice mailed by Lender to Borrower(s) requesting payment thereof, but in no
event shall Lender require payment in advance for taxes and assessments to be
held and disbursed as set forth hereunder in an amount which exceeds the
estimate of the next year’s amount for same.

Upon payment in full of all sums secured by this Mortgage, Lender shall promptly
refund to Borrower(s) any funds held by Lender. If under paragraph 16 hereof the
Property is sold or the Property is otherwise acquired by Lender, Lender shall
apply, no later than immediately prior to the sale of the Property or its
acquisition by Lender, any Funds then held by Lender as a credit against the
sums secured by this Mortgage.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and Paragraphs 1 and 2 hereof shall
be applied by Lender first in payment of amounts payable to Lender by
Borrower(s) under Paragraph 2 hereof, if any, then against advances, if any,
made by Lender pursuant to Paragraph 7 of this Mortgage, then to costs, fees,
expenses and other amounts incurred and advanced by the Lender in the
enforcement of its rights under the Note and this Mortgage, including, without
limitation, costs and reasonable attorneys’ fees, then to unpaid service fees,
then to interest payable on the Note, then to principal under the Note, then to
unpaid late charges, if any, then to interest on any Future Advances made at the
Lender’s option pursuant to Paragraph 20 hereof, and then to the principal of
any Future Advances, if any, made at Lender’s option pursuant to Paragraph 20
hereof.

4. Charges; Liens. Borrower(s) shall promptly pay, when due, all Condominium
Assessments imposed by SurfWatch Owners Association Inc. or other governing body
of SurfWatch Horizontal Property Regime (the “Condominium Association”) pursuant
to the provisions of the Master Deed, Time Sharing Declaration, By-Laws, Rules
and Regulations or other constituent documents of SurfWatch Horizontal Property
Regime. Borrower(s) shall pay all taxes, assessments and other charges, fines
and impositions attributable to the Property which may attain a priority over
this Mortgage, in the manner provided under paragraph 2 hereof or, if not paid
in such manner, by Borrower(s) making payment, when due, directly to the payee
thereof. Borrower(s) shall promptly furnish to Lender all notices of amounts due
under this Paragraph, and in the event Borrower(s) shall make payment directly,
Borrower(s) shall promptly furnish to Lender receipts evidencing such payments.
Borrower(s) shall promptly discharge any lien which has priority over this
Mortgage; provided, that Borrower(s) shall not be required to discharge any such
lien so long as Borrower(s) shall agree in writing to the payment of the
obligation secured by such lien in a manner acceptable to Lender and, if
requested by Lender, immediately post with Lender an amount necessary to satisfy
said obligation, or shall in good faith contest such lien by, or defend
enforcement of such lien in, legal proceedings which operate to prevent the
enforcement of the lien or forfeiture of the Property or any part thereof and,
if requested by Lender, immediately post with Lender an amount necessary to
satisfy said obligation.

5. Hazard Insurance. Borrower(s) shall keep the improvements now existing or
hereafter erected on the Property insured against loss by fire, hazards included
within the term “extended coverage”, and such other hazards as Lender may
require and in such amounts and for such periods as Lender may require;
provided, that Lender shall not require that the amount of such coverage exceed
that amount of coverage required to pay the sums secured by this Mortgage. This
obligation shall be deemed satisfied so long as the Condominium Association
maintains a “master” or “blanket” policy in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower(s) or
the Condominium Association subject to approval by Lender; provided, that such
approval shall not be unreasonably withheld. If required, all premiums on
insurance policies shall be paid in the manner provided under paragraph 2
hereof, or, if not paid in such manner, by Borrower(s) or the Condominium
Association making payment, when due, directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower(s) shall give Lender prompt notice of any lapse
in hazard insurance coverage. In the event of loss, Borrower(s) shall give
prompt notice to the insurance carrier and Lender. Lender may make proof of loss
if not made promptly by Borrower(s).

Pursuant to the terms of the Master Deed and/or Time Sharing Declaration,
insurance proceeds shall be applied to restoration or repair of the Property
damaged, whether the unit or the common elements. To the extent such insurance
proceeds exceed the cost of such restoration or repair and the Board of
Directors of the Condominium Association decides to disburse such excess,
Borrower’s share of such excess shall be applied to the sums secured by this
Mortgage, with the excess, if any, paid to Borrower(s).

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not exceed or postpone the due date of the
monthly installments referred to in paragraphs 1 and 2 hereof or change the
amount of such installments. If under paragraph 17 hereof the Property is
acquired by Lender, all right, title and interest of Borrower(s) in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to Lender to
the extent of the sums secured by this Mortgage immediately prior to such sale
or acquisition.

6. Preservation and Maintenance of Property; Condominium. Borrower(s) shall keep
the Property in good repair and shall not commit waste or permit impairment or
deterioration of the Property. Borrower(s) shall perform all of Borrower’s
obligations under the Master Deed and/or Time Sharing Declaration, the By-Laws,
Rules and Regulations of the Condominium Association, and constituent documents.
Borrower(s) shall take such actions as may be reasonable to insure that the
Condominium Association maintains a public liability insurance policy acceptable
in form, amount, and extent of coverage to Lender.

7. Protection of Lender’s Security. If Borrower(s) fail(s) to perform the
covenants and agreements contained in this Mortgage, or if any action or
proceeding is commenced which materially affects Lender’s interest in the
Property, including, but not limited to, eminent domain, insolvency, code
enforcement, or arrangements or proceedings involving a bankruptcy or decedent,
then Lender at Lender’s option, upon notice to Borrower(s), may make such
appearances, disburse such sums and take such action as is necessary to protect
Lender’s interest, including, but not limited to, disbursement of funds to pay
reasonable attorneys’ fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this paragraph 7, with interest
thereon, shall become additional indebtedness of Borrower(s) secured by this
Mortgage. Unless Borrower(s) and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower(s) requesting
payment thereof, and shall bear interest from the date of disbursement at the
rate payable from time to time on outstanding principal under the Note unless
payment of interest at such rate would be contrary to applicable law, in which
event such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

 

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8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Property, provided that Lender shall give Borrower(s) notice
prior to any such inspection specifying reasonable cause therefore related to
Lender’s interest in the Property.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower(s) in connection with any condemnation or
other taking of all or any part of the Property, whether of the unit or the
common elements or for any conveyance in lieu of condemnation, pursuant to the
terms of the Master Deed and/or Time Sharing Declaration, are hereby assigned
and shall be paid to Lender as provided hereunder.

Unless Lender and Borrower(s) otherwise agree in writing, any such application
of proceeds to principal shall not extend or postpone the due date of the
monthly installments referred to in paragraphs 1 and 2 hereof or change the
amount of such installments.

10. Borrower(s) Not Released. Extension of the time for payment or modification
of amortization of the sums secured by this Mortgage granted by Lender to any
successor in interest of Borrower(s) shall not operate to release, in any
manner, the liability of the original Borrower(s) and Borrower’s successors in
interest. Lender shall not be required to commence proceedings against such
successor or refuse to extend time for payment or otherwise modify amortization
of the sums secured by this Mortgage by reason of any demand made by the
original Borrower(s) and Borrower’s successors in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Mortgage.

12. Remedies Cumulative. All remedies provided in this Mortgage are distinct and
cumulative to any other right or remedy under this Mortgage or afforded by law
or equity, and may be exercised concurrently, independently or successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of paragraph 16 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower(s). All covenants and
agreements of Borrower(s) shall be joint and several. The captions and headings
of the paragraphs of this Mortgage are for convenience only and are not to be
used to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law or under the
Note, as applicable, to be given in another manner, (a) any notice to
Borrower(s) provided for in this Mortgage shall be given by mailing such notice
by U.S. Mail, postage prepaid, addressed to Borrower(s) at the Borrower’s
address as set forth in the Note, or at such other address as Borrower(s) may
designate by notice to Lender as provided herein, and (b) any notice to Lender
shall be given by certified mail, return receipt requested, to Lender’s address
stated herein or to such other address as Lender may designate by notice to
Borrower(s) as provided herein. Any notice provided for in this Mortgage shall
be deemed to have been given to Borrower(s) or Lender when given in the manner
designated herein. In the event of a judicial action to enforce this Mortgage,
Borrower hereby agrees that any notice required or service of process made
incident thereto shall be sufficient if made to the above address. Borrower may
change such address by giving Lender notice of a change of address in writing to
Lender’s address stated herein.

15. Governing Law; Severability. This Mortgage shall be governed by the laws of
the state where the Property is located. In the event that any provision or
clause of this Mortgage or the Note conflicts with applicable law, such conflict
shall not affect other provisions of this Mortgage or the Note which can be
given effect without the conflicting provision, and to this end the provisions
of the Mortgage and the Note are declared to be severable.

16. Transfer of the Property; Assumption. If all or any part of the Property or
an interest therein is sold (or leased with an option to purchase) or
transferred by Borrower(s) without Lender’s prior written consent, excluding
(a) a transfer by devise, descent or by operation of law upon the death of a
joint tenant, or (b) the creation of a lien or encumbrance subordinate to this
Mortgage, Lender may, at Lender’s option, declare all the sums secured by this
Mortgage to be immediately due and payable. Lender shall have waived such option
to accelerate if, and only if, prior to the sale (or lease with option to
purchase) or transfer, Lender and the person to whom the Property is to be sold
(or leased) or transferred reach agreement in writing that the credit of such
person is satisfactory to Lender and that the interest payable on the sums
secured by this Mortgage shall be at such rate as Lender shall request. If
Lender has waived the option to accelerate provided in this paragraph 16, and if
Borrower’s successor in interest has executed a written assumption agreement
accepted in writing by Lender, Lender shall release Borrower(s) from all
obligations under this Mortgage and the Note.

If Lender exercises such option to accelerate, Lender shall mail Borrower(s)
notice of acceleration in accordance with paragraph 14 hereof. Such notice shall
provide a period of not less than fifteen (15) days from the date the notice is
mailed within which Borrower(s) may pay the sums declared due. If Borrower(s)
fails to pay such sums prior to the expiration of such period, Lender may,
without further notice or demand on Borrower(s), invoke any remedies permitted
by paragraph 17 hereof.

17. Acceleration; Remedies. Except as provided in paragraph 16 hereof, upon
Borrower’s breach of any covenant or agreement of Borrower(s) in this Mortgage,
including the covenants to pay when due any sums secured by this Mortgage,
Lender prior to acceleration shall mail notice to Borrower(s) as provided in
paragraph 14 hereof specifying: (1) the breach; (2) the action required to cure
such breach; (3) a date, not less than fifteen (15) days from the date the
notice is mailed to Borrower(s), by which such breach must be cured; and
(4) that failure to cure such breach on or before the date specified in the
notice may result in acceleration of the sums secured by this Mortgage,
foreclosure by judicial proceeding or other proceedings consistent with the law,
and sale of Property. If the breach is not cured on or before the date specified
in the notice, Lender at Lender’s option, may declare, without further demand,
all of the sums secured by this Mortgage to be immediately due and payable and
may foreclose this Mortgage by judicial proceedings. Lender shall be entitled to
collect all expenses of collection, including, but not limited to, reasonable
attorney’s fees, whether or not action be instituted hereon, court costs, and
costs of documentary evidence, abstracts and title reports. As used in this
Mortgage and in the Note, “attorney’s fees” shall include attorney’s fees, if
any, which may be awarded by an appellate court.

18. Non-Judicial Foreclosure. There is a mortgage lien against your timeshare
estate which must be repaid in accordance with this Mortgage. Your failure to
make timely payments required by this Mortgage may result in foreclosure of the
mortgage lien. The Borrower (hereinafter in this paragraph 18 referred to as
“Mortgagor”) acknowledges that, if the obligations established by this Mortgage
are not satisfied and the Mortgagor does not cure the default in accordance with
the terms hereof, the mortgage lien created by this Mortgage may be foreclosed
through a nonjudicial procedure in accordance with Article 3 of Chapter 32 of
Title 27 of the Code of Laws of South Carolina. The Mortgagor understands that
he or she will not be subject to a deficiency judgment or personal liability for
the mortgage lien resulting from a nonjudicial foreclosure procedure even if the
sale of his or her timeshare estate resulting from the foreclosure for the
mortgage lien is insufficient to satisfy the amount of the mortgage lien. The
Mortgagor further acknowledges that the trustee will send the notice required by
this procedure to the Mortgagor’s notice address, and the Mortgagor agrees to
inform the Mortgagee of any change in the Mortgagor’s address. The Mortgagor
consents to notification by certified or registered mail and agrees that any
person at the Mortgagor’s notice address may acknowledge receipt of any
correspondence received in connection with this procedure. The

 

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Mortgagor understands that the trustee may notify Mortgagor of the commencement
of the procedure by publication if delivery of the notice is not accepted at the
notice address. If the Mortgagor sends the trustee a written objection to the
nonjudicial procedure stating the reasons for such objection, the matter will be
transferred to a judicial foreclosure procedure, but the Mortgagor understands
and agrees that in the judicial foreclosure procedure, he or she may be subject
to a deficiency judgment or personal liability for the mortgage lien if the sale
of his or her timeshare estate resulting from the foreclosure is insufficient to
satisfy the amount of the mortgage lien. The Mortgagor further understands and
agrees that in the judicial foreclosure procedure if the court finds that there
is a complete absence of a justifiable issue of either law or fact raised by the
objection or defense, the Mortgagor may be personally liable for the costs and
attorney’s fees incurred by the Mortgagee in the judicial foreclosure.

McNair Law Firm P.A. is hereby named Trustee of the within conveyed Property for
the purposes of the timeshare lien foreclosure pursuant to and in accordance
with Article 3 of Chapter 32 of Title 27 Code of Laws of South Carolina.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower(s) hereby assigns to Lender the rents of the Property,
provided that Borrower(s) shall, prior to acceleration under paragraph 17 hereof
or abandonment of the Property, have the right to collect and retain such rents
as they become due and payable.

Upon acceleration of the Note or abandonment of the Property, Lender shall be
entitled without notice, to enter upon, take possession of and manage the
Property and to collect the rents of the Property, including those past due. All
rents collected shall be appointed first to payment of the costs of management
of the Property and collection of rents, including, but not limited to,
management fees, court costs, and reasonable attorneys’ fees and then to the
sums secured by this Mortgage. The Lender shall be liable to account only for
those rents actually received. Borrower(s) shall not be entitled to possession
or use of the Property after abandonment or after the Lender has accelerated the
balance due under the Note. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Property. If a receiver is
appointed, any income from rents from the Property shall be applied first to the
costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower(s), Lender, at Lender’s option,
may make Future Advances to Borrower(s). Such Future Advances, with interest
thereon, shall be secured by this Mortgage when evidenced by promissory notes
stating that said notes are secured hereby. At no time shall the principal
amount of the indebtedness secured by this Mortgage, not including sums advanced
in accordance herewith to protect the security of this Mortgage, exceed one
hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower(s) shall not, except after notice to Lender
and with Lender’s prior written consent, either partition or subdivide the
Property or consent to:

(i) The abandonment or termination of SurfWatch Horizontal Property Regime,
except for abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain;

(ii) any amendment to any provision of the Master Deed and/or Time Sharing
Declaration, By-Laws or Rules and Regulations of the Condominium Association, or
equivalent constituent documents of SurfWatch Horizontal Property Regime which
is for the express benefit of Lender; or

(iii) any action which would have the effect of rendering the public liability
insurance coverage maintained by the Condominium Association unacceptable to
Lender.

22. Attorneys’ Fees. As used in this Mortgage and in the Note, “attorneys’ fees”
shall include attorneys’ fees, if any, and related costs incurred by Lender in
the enforcement of its rights under the Note and/or Mortgage, whether or not
legal action is instituted, and any fees and costs of trial and appellate
proceedings.

23. Venue and Jurisdiction. Borrower hereby consents to the enforcement of the
Note and Mortgage in Beaufort County, South Carolina and hereby submits to the
jurisdiction of the courts of the state of South Carolina for such purpose.

IN WITNESS WHEREOF, Borrower(s) has/have executed this Mortgage on the day and
year first written above.

 

Signed in the presence of:     (2)         (1)     First Witness signs here    
Mortgagor: «LEGAL_NAME_1»

 

(3)         (1)     Second Witness signs here     Mortgagor: «LEGAL_NAME_2»
(Notary may sign as 2nd witness)    

 

      (1)           Mortgagor: «LEGAL_NAME_3»

 

      (1)           Mortgagor: «LEGAL_NAME_4»

 

STATE OF _____________    )    ACKNOWLEDGMENT

COUNTY OF ___________

   )   

I, the undersigned Notary Public do hereby certify that «LEGAL_NAME» personally
appeared before me this day and acknowledged the due execution of the foregoing
instrument.

Witness my hand and official seal this the              day of
                                    ,                 .

 

NOTARY SIGN____________________________ NOTARY PUBLIC FOR:     My commission
expires:    

(SEAL HERE)

 

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This document prepared and recorded under the supervision of the «SC_ATTY»

Return to: Marriott Ownership Resorts, Inc., P.O. Box 24747, Lakeland, FL 33802

 

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UTAH SAMPLE (MVC)

(INDIVIDUAL)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable dates for commencement of payments due hereunder, the monthly payment
date and the final payment date. DO NOT DESTROY THIS NOTE. When paid, this Note,
with the Trust Deed securing the same, must be surrendered to the Trustee for
cancellation before reconveyance will be made.

PROMISSORY NOTE

Resort Interest No.(s):

______________________________

MountainSide Condominium

 

US $______________________

   ___________________, 20__    

FOR VALUE RECEIVED, the undersigned (“Borrower(s)”) promise(s) to pay to the
order of MARRIOTT OWNERSHIP RESORTS, INC., (said party or any other party to
whom this Note may be transferred and assigned is hereinafter called the
“Holder”), P.O. Box 8038, Lakeland, Florida 33802, or order, the principal sum
of                                               U.S. Dollars (US $
                ), with interest on the unpaid balance from the date of this
Note, or                                  (whichever is later), until paid, at
the rate of              percent (                %) per annum. Interest shall
be calculated by applying the stated annual rate against the unpaid principal
for the actual number of days elapsed divided by a 360 day year. Principal and
interest shall be payable, without offset, in lawful money of the United States
at the Holder’s address set forth above, or such other place as the Holder may
from time to time designate, in consecutive monthly installments of             
U.S. Dollars (US $            ), beginning on the              day of
                                         and continuing thereafter on the same
day of each month, with the remaining unpaid balance, together with accrued
interest thereon, due and payable, if not sooner paid, on
                                                             .

The indebtedness evidenced by this Note is secured by a Trust Deed, dated of
even date herewith, creating a lien on the real property described therein (the
“Property”), located in Park City, Summit County, Utah. Reference is made to
said Trust Deed for rights of the Holder upon acceleration of the indebtedness
evidenced by this Note.

Each monthly payment shall be tendered with a $5.00 service fee. If any monthly
installment is not received by the Holder within ten (10) days after the date
the installment is due, Borrower(s) shall pay to the Holder a late charge of six
percent (6%) of such late installment or $15.00, whichever is greater. The
Holder may apply any payment received by it to the payment of all late charges
then owing before application to interest or principal. Such late charge is in
addition to and not in lieu of or diminution of any other rights and remedies of
the Holder of this Note.

Each payment made by Borrower(s) shall be credited on account of amounts due in
the order specified in Paragraph 20 of the Trust Deed.

Borrower(s) may prepay the principal amount outstanding in whole or in part
without a penalty. Any partial prepayment in excess of the amounts then due
shall be applied against the principal amount outstanding but shall not postpone
the due date of any subsequent monthly installments or change the amount of such
installments.

The makers, sureties, guarantors and endorsers hereof severally waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution. This Note shall be the joint and
several obligation of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their respective heirs, personal representatives,
successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

 

  a. Failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
fifteen (15) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b. The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s);

 

  c. The sale (or lease with option to purchase) or transfer of all or any part
of the Property or any interest therein without the prior written consent of the
Holder, excluding a transfer by devise, descent or by operation of law upon the
death of a joint tenant therein; or

 

  d. Failure of Borrower(s) to comply with the covenants of the Trust Deed after
notice and failure to cure as provided in the Trust Deed.

The Holder may exercise its option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, attorneys’ fees, whether or not action be instituted hereon.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given after mailing same by U.S. mail, postage prepaid (or such other more
expeditious method as may be appropriate in the case of foreign addresses, as
Holder may choose in its discretion), addressed to Borrower(s) at the address
stated below, or to such other address as Borrower(s) may designate by written
notice to the Holder. Any notice to the Holder shall be deemed to have been
given by mailing such notice by U.S. certified mail, return receipt requested,
(or in the case of a notice originating in a foreign country, by such other
method that results in the Holder acknowledging in writing receipt of the
notice), at 1200 U.S. 98 South, Lakeland, Florida 33801, or at such other
address as may be designated by written notice to Borrower(s).

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically

 

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deemed reformed so as to permit only the collection of the maximum non-usurious
rate and amount of interest allowable under applicable law.

This Note shall be governed by, construed under and enforced in accordance with
the laws of the State of Utah. Borrower(s) consent(s) to jurisdiction and venue
in the state and federal courts within the State of Utah.

 

BORROWER(S) ADDRESS:     BORROWER(S):               (SEAL)       (Name of
Individual)  

 

            (SEAL)     (Name of additional Individual)  

 

           (SEAL)     (Name of additional Individual)  

 

           (SEAL)     (Name of additional Individual)  

(Execute Original Only)

 

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UTAH SAMPLE (MVC)

WHEN RECORDED, MAIL TO:

First American Title Insurance Agency, LLC

81 S. Main Street

P.O. Box 160

Heber City, Utah 84032

TRUST DEED

With Assignment of Rents

THIS TRUST DEED, made this                  day of
                                , 20     between
                                                         , whether one or more,
as TRUSTOR, whose address is                                        
                                                                         

                                                                 
                                                 (Street and number)

                                                                  
                   , and First American Title Insurance Agency, LLC, 81 S. Main
Street, P.O. Box 160, Heber City, Utah 84032, as TRUSTEE, and MARRIOTT OWNERSHIP
RESORTS, INC., a Delaware Corporation, whose address is 1200 U.S. 98 South,
Lakeland, Florida 33801, as BENEFICIARY.

WITNESSETH: That Trustor CONVEYS AND WARRANTS TO TRUSTEE IN TRUST, WITH POWER OF
SALE, the following described real property (herein the “Property”), lying
situate and being in Park City, Summit County, Utah:

Resort Interest No(s):                ,               ,                 , and
                , together with, for each such Resort Interest, an undivided
interest in the Common Areas and Facilities in MountainSide Condominium, as more
particularly shown and described in the Declaration of Condominium establishing
the said condominium, being dated                         and recorded in the
Office of the County Recorder for Summit County, Utah on
                        , Entry No.                    , Book
                    , at Page                     , as may be amended or
supplemented from time to time (the “Declaration”), and by reference to that
certain recorded Record of Survey Map dated                    , and recorded in
the Office of the County Recorder for Summit County, Utah as part of the
Declaration, Entry No.                    , as may be further amended or
supplemented from time to time;

TOGETHER WITH all of the rights, title privileges, easements, and common areas
and facilities appertaining to the above described Resort Interest (s), as set
forth in the Declaration;

TOGETHER WITH all and singular the rights, members, hereditaments and
appurtenances to the said property belonging or in any way incidental or
appertaining;

TOGETHER WITH all fixtures and improvements now or hereafter located thereon and
all water rights, rights of way, easements, rents, issues, profits, income,
tenements, hereditaments, privileges and appurtenances thereunto belonging, now
or hereafter used or enjoyed with the Property, or any part thereof, SUBJECT,
HOWEVER, to the right, power and authority hereinafter given to and conferred
upon Beneficiary to collect and apply such rents, issues, and profits;

FOR THE PURPOSE OF SECURING (1) payment of the indebtedness evidenced by a
promissory note, in the principal sum of $                            , made by
Trustor, payable to the order of the Beneficiary at the times, in the manner and
with interest as therein set forth, and any extensions and/or renewals or
modifications thereof (herein the “Note”); (2) the performance of each agreement
of Trustor herein contained; (3) the payment of

 

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such additional loans or advances (herein “Future Advances”) as hereafter may be
made to Trustor, or his successors or assigns, when evidenced by a promissory
note or notes reciting that they are secured by this Trust Deed; and (4) the
payment of all sums expended or advanced by Beneficiary under or pursuant to the
terms hereof, together with interest thereon as herein provided.

Trustor covenants that Trustor is lawfully seized of the estate hereby conveyed
and has the right to mortgage, grant and convey the Property, that the Property
is unencumbered, and that Borrower will warrant and defend generally the title
to the Property against all claims and demands, subject to any declarations,
easements or restrictions listed in a schedule of exceptions to coverage in any
title insurance policy insuring Beneficiary’s interest in the Property.

Trustor shall promptly pay when due the principal of and interest on the
indebtedness evidenced by the Note, late charges as provided in the Note,
reasonable service charges imposed by Beneficiary for servicing the loan
account, and the principal of and interest on any Future Advances secured by
this Trust Deed.

TO PROTECT THE SECURITY OF THIS TRUST DEED, TRUSTOR AGREES:

1. Trustor’s Obligations Concerning Property. To keep the Property in good
condition and repair; not to remove or demolish any building thereon, to restore
promptly and in good and workmanlike manner any building thereon which may be
damaged or destroyed; to comply with all laws, covenants and restrictions
affecting the Property; not to commit or permit waste thereof; not to commit,
suffer or permit any act upon the Property in violation of law; to do all other
acts which from the character or use of the Property may be reasonably
necessary, including complying with the provisions of the Declaration, the
By-Laws and Rules and Regulations of MountainSide Condominium Association Inc.
(“Condominium Association”), and all other documents pertaining to the
Condominium Association.

Trustee, upon presentation to it of an affidavit signed by Beneficiary, setting
forth facts showing a default by Trustor under this numbered paragraph, is
authorized to accept as true and conclusive all facts and statements therein,
and to act thereon hereunder.

2. Insurance. To take such actions as may be reasonable to insure that the
Condominium Association each provides and maintains insurance of such types and
amounts as the Declaration may require, covering the improvements now existing
or hereafter erected or placed on the Property. Such insurance shall be carried
in companies approved by Beneficiary, with loss payable clauses in favor of and
in form acceptable to Beneficiary. In event of loss, Trustor shall give
immediate notice to Beneficiary, who may make proof of loss, and each insurance
company concerned is hereby authorized and directed to make payment for such
loss directly to Beneficiary instead of Trustor and Beneficiary jointly. The
insurance proceeds, if required by the Declaration or vote of the unit owners,
shall be applied by Beneficiary to the restoration or repair of the property
damaged.

To the extent such insurance proceeds exceed the cost of such restoration or
repair and the Board of Trustees of the Condominium Association decides to
disburse such excess, Trustor’s share of such excess shall be applied to the
sums secured hereby, with the excess, if any, paid to Trustor. Unless
Beneficiary and Trustor otherwise agree in writing, any such application of
proceeds to principal shall not postpone the due dates of the monthly
installments payable by Trustor hereunder, nor change the amount of such
installments. If under the provisions of this Trust Deed, the Property is
acquired by Beneficiary, all right, title and interest of Trustor in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Property prior to the sale or acquisition shall pass to
Beneficiary to the extent of the sums secured by this Trust Deed immediately
prior to such sale or acquisition.

3. Evidence of Title. To deliver to, pay for and maintain with Beneficiary until
the indebtedness secured hereby is paid in full, such evidence of title as
Beneficiary may require including a policy of title insurance.

4. Trustor to Defend Title. To appear in and defend any action or proceeding
purporting to affect the security hereof, the title to the Property, or the
rights or powers of Beneficiary or Trustee; and should Beneficiary or Trustee
elect also to appear in or defend any such action or proceeding, to pay all
costs and expenses including cost of evidence of title and attorney’s fees in a
reasonable sum incurred by Beneficiary or Trustee.

5. Real Estate Taxes; Maintenance Fees; Other Charges.

(a) To pay at least 10 days before delinquency all taxes and assessments
affecting the Property, including all Regular Resort Assessments and Special
Resort Assessments (as those terms are defined in the Declaration) arising under
the Declaration (collectively the “Common Assessments”); to pay, when due, all

 

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encumbrances, charges, and liens with interest, on the Property or any part
thereof, which at any time appear to be prior or superior hereto; to pay all
costs, fees, and expenses of this Trust.

(b) Subject to applicable law, upon written request by Beneficiary to Trustor,
Trustor shall pay to Beneficiary on the day when monthly installments of
principal and interest are payable under the Note, until the Note is paid in
full, a sum (herein “Funds”) equal to one-twelfth of Trustor’s share of the
yearly taxes and assessments relating to the subject Property encumbered by this
Trust Deed and one-twelfth of the annual Common Assessment due under the
Declaration, or such other amounts or for such other periods other than monthly,
e.g. quarterly, etc., all as reasonably estimated initially and from time to
time by Beneficiary on the basis of assessments and bills and reasonable
estimates thereof.

(c) If Beneficiary exercises the right set forth in b) above, the Funds shall be
held in an institution the deposits or accounts of which are insured or
guaranteed by a Federal or State agency. Beneficiary shall apply the Funds, upon
receipt of the appropriate bill or bills, to pay said taxes and Common
Assessments. Beneficiary may not charge for so holding and applying the Funds,
analyzing said account, or verifying and compiling said Common Assessments and
bills, unless Beneficiary pays to Trustor interest on the Funds and applicable
law permits Beneficiary to make such a charge. Unless applicable law requires,
and except as provided above, Beneficiary shall not be required to pay Trustor
any interest on the Funds. Beneficiary shall give to Trustor, without charge, an
annual accounting of the Funds showing credits and debits to the Funds and the
purposes for which each debit to the Funds was made. The Funds are hereby
pledged as additional security for the sums secured by this Trust Deed.

(d) If the amount of the Funds held by Beneficiary, together with the future
monthly installments of Funds payable prior to the due dates of taxes and Common
Assessments, shall exceed the amount required to pay such taxes and Common
Assessments as they fall due, such excess shall be, at Trustor’s option, either
promptly repaid to Trustor or credited to Trustor on future monthly installments
of Funds. If the amount of the Funds held by Beneficiary shall not be sufficient
to pay taxes and Common Assessments as they fall due, Trustor shall pay to
Beneficiary any amount necessary to make up the deficiency within thirty
(30) days from the date of a notice mailed by Beneficiary to Trustor requesting
payment thereof, but in no event shall Beneficiary require payment in advance
for taxes and Common Assessments to be held and disbursed as set forth hereunder
in an amount which exceeds the estimate of the next year’s amount for same.

(e) Upon payment in full of all sums secured by this Trust Deed, Beneficiary
shall promptly refund to Trustor any Funds held by Beneficiary. If in the
exercise of Beneficiary’s remedies under this Trust Deed, the Property is sold
or the Property is otherwise acquired by Beneficiary, Beneficiary shall apply,
no later than immediately prior to the sale of the Property or its acquisition
by Beneficiary, any Funds then held by Beneficiary as a credit against the sums
secured by this Trust Deed.

6. Protection of Security of Trust Deed. Should Trustor fail to make any payment
or to do any act as herein provided, then Beneficiary or Trustee, but without
obligation so to do and without notice to or demand upon Trustor and without
releasing Trustor from any obligation hereof, may (i) make or do the same in
such manner and to such extent as either may deem necessary to protect the
security hereof, Beneficiary or Trustee being authorized to enter upon the
Property for such purposes; (ii) commence, appear in and defend any action or
proceeding purporting to affect the security hereof or the rights or powers of
Beneficiary or Trustee; (iii) pay, purchase, contest, or compromise any
encumbrance, charge or lien which in the judgment of either appears to be prior
or superior hereto; and (iv) in exercising any such powers, incur any liability,
expend whatever amounts in its absolute discretion it may deem necessary
therefor, including cost of evidence of title, employ counsel, and pay his
reasonable fees. Trustor agrees to pay immediately and without demand all sums
expended hereunder by Beneficiary or Trustee, with interest from date of
expenditure at the rate payable from time to time on outstanding principal under
the Note until paid, and the repayment thereof shall be secured hereby.

7. Right of Entry. To permit Beneficiary to make or cause to be made reasonable
entries upon and inspections of the Property, provided that Beneficiary shall
give Trustor notice prior to any such inspection, specifying reasonable cause.

IT IS MUTUALLY AGREED THAT:

8. Condemnation Awards and Insurance Proceeds. Should the Property or any part
thereof be taken or damaged by reason of any public improvement or condemnation
proceeding, or damaged by fire, or earthquake, or in any other manner,
Beneficiary shall be entitled to all compensation, awards, and other payments or

 

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relief therefor, and shall be entitled at its option to commence, appear in and
prosecute in its own name, any action or proceedings, or to make any compromise
or settlement, in connection with such taking or damage. All such compensation,
awards, damages, rights of action and proceeds, including the proceeds of any
policies of fire and other insurance affecting the Property, are hereby assigned
to Beneficiary, who may, after deducting therefrom all its expenses, including
attorney’s fees, apply the same on any indebtedness secured hereby. Trustor
agrees to execute such further assignments of any compensation, award, damages,
and rights of action and proceeds as Beneficiary or Trustee may require. Unless
Beneficiary and Trustor otherwise agree in writing, any application of proceeds
to the indebtedness secured hereby shall not postpone the due date of the
monthly installments payable under the terms of the Note or pursuant to
Paragraph 5 hereof, nor change the amount of such installments.

9. Actions by Trustee. At any time and from time to time upon written request of
Beneficiary, payment of its fees and presentation of this Trust Deed and the
Note for endorsement (in case of full reconveyance, for cancellation and
retention), without affecting the liability of any person for the payment of the
indebtedness secured hereby, Trustee may (a) consent to the making of any map or
plat of the Property; (b) join in granting any easement or creating any
restriction thereon; (c) join in any subordination or other agreement affecting
this Trust Deed or the lien or charge thereof; (d) reconvey, without warranty,
all or any part of the Property. The grantee in any reconveyance may be
described as “the person or persons entitled thereto”, and the recitals therein
of any matters or facts shall be conclusive proof of the truthfulness thereof.
Trustor agrees to pay reasonable Trustee’s fees for any of the services
mentioned in this paragraph.

10. Conditional Assignment of Rents. As additional security, Trustor hereby
assigns to Beneficiary, during the continuance of these trusts, all rents,
issues, royalties, and profits of the Property affected by this Trust Deed and
of any personal property located thereon. Until Trustor shall default in the
payment of any indebtedness secured hereby or in the performance of any
agreement hereunder, Trustor shall have the right to collect all such rents,
issues, royalties, and profits earned prior to default as they become due and
payable. From and after any such default by Trustor, Trustor’s right to collect
any of such sums shall cease, and Beneficiary shall have the right, with or
without taking possession of the Property, to collect all rents, royalties,
issues, and profits. Failure or discontinuance of Beneficiary at any time or
from time to time to collect any such sums shall not in any manner affect the
subsequent enforcement by Beneficiary of the right, power, and authority to
collect the same. Nothing contained herein, nor the exercise of the right by
Beneficiary to collect, shall be, or be construed to be, an affirmation by
Beneficiary of any tenancy, lease or option, nor an assumption of liability
under, nor a subordination of the lien or charge of this Trust Deed to, any such
tenancy, lease or option.

11. Receiver. Upon any default by Trustor hereunder, Beneficiary may at any time
without notice, either in person, by agent, or by a receiver to be appointed by
a court (Trustor hereby consenting to the appointment of Beneficiary as such
receiver), and without regard to the adequacy of any security for the
indebtedness hereby secured, enter upon and take possession of the Property or
any part thereof, in its own name sue for or otherwise collect any rents,
issues, and profits, including those past due and unpaid, and apply the same,
less costs and expenses of operation and collection, including reasonable
attorney’s fees, upon any indebtedness secured hereby, and in such order as
Beneficiary may determine. Beneficiary shall be liable to account to Trustor
only for those rents actually received.

12. Exercise of Rights by Beneficiary Shall Not Constitute a Cure. The entering
upon and taking possession of the Property, the collection of such rents,
issues, and profits, or the proceeds of fire and other insurance policies, or
compensation or awards for any taking of or damage to the Property and the
application or release thereof as aforesaid, shall not cure or waive any default
or notice of default hereunder or invalidate any act done pursuant to such
notice.

13. Notice of Sale. The Trustor requests that a copy of any notice of sale
hereunder be mailed to him at the address hereinbefore set forth.

14. Trustor’s Default. Time is of the essence hereof. Upon default by Trustor in
the payment of any indebtedness secured hereby or in the performance of any
agreement hereunder, Beneficiary, prior to acceleration of the debt, shall mail
notice to Trustor as provided in paragraph 23 hereof, specifying: (i) the
breach; (ii) the action required to cure such breach; (iii) a date, not less
than fifteen (15) days from the date the notice is mailed to Trustor by which
such breach must be cured; and (iv) that failure to cure such breach on or
before the date specified in the notice may result in acceleration of the sums
secured by this Trust Deed and sale of the Property by the Trustee or at
foreclosure by judicial proceeding. If the breach is not cured on or before the
date specified in the notice, Beneficiary, at Beneficiary’s option, may declare,
without further demand, all of the sums secured by this Trust Deed to be
immediately due and payable and may either direct the Trustee to sell the
Property or foreclose this Trust Deed

 

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by judicial proceedings. Beneficiary shall be entitled to collect all expenses
of collection, including, but not limited to, attorney’s fees, whether or not
action be instituted hereon, court costs, and costs of documentary evidence,
abstracts and title reports. As used in this Trust Deed and in the Note,
“attorney’s fees” shall include attorney’s fees, if any, which may be awarded by
an appellate court.

15. Power of Sale. In the event of such default and acceleration of the debt,
Beneficiary may execute or cause Trustee to execute a written notice of default
and of election to cause the Property to be sold to satisfy the obligations
hereof, and Trustee shall file such notice for record in each county wherein the
Property is situated. Beneficiary also shall deposit with Trustee, the Note and
all documents evidencing expenditures secured hereby. After the lapse of such
time as may then be required by law following the recordation of said notice of
default, and notice of default and notice of sale having been given as then
required by law; Trustee, without demand on Trustor, shall sell the Property on
the date and at the time and place designated in the notice of sale, either as a
whole or in separate parcels, and in such order as it may determine (but subject
to any statutory right of Trustor to direct the order in which such property, if
consisting of several known lots or parcels, shall be sold) at public auction to
the highest bidder, the purchase price payable in lawful money of the United
States at the time of sale. The person conducting the sale may, for any cause he
deems expedient, postpone the sale from time to time until it shall be completed
and, in every case, notice of postponement shall be given by public declaration
thereof by such person at the time and place last appointed for the sale;
provided, however, if the sale is postponed for longer than one day beyond the
day designated in the notice of sale, notice thereof shall be given in the same
manner as the original notice of sale. Trustee shall execute and deliver to the
purchaser its Deed conveying the Property so sold, but without any covenant or
warranty, express or implied. The recitals in the Deed of any matters or facts
shall be conclusive proof of the truthfulness thereof. Any person, including
Beneficiary, may bid at the sale. Trustee shall apply the proceeds of the sale
to the payment of (i) the costs and expenses of exercising the power of sale and
of the sale, including the payment of the Trustee’s and attorney’s fees
(including any which may be awarded by an appellate court); (2) cost of any
evidence of title procured in connection with such sale and revenue stamps, if
any, on the Trustee’s Deed; (3) all sums expended under the terms hereof, not
then repaid, with accrued interest from date of expenditure at the rate payable
from time to time on outstanding principal under the Note; (4) all other sums
then secured hereby; and (5) the remainder, if any, to the person or persons
legally entitled thereto, or the Trustee, in its discretion, may deposit the
balance of such proceeds with the County Clerk of the county in which the sale
took place.

16. Judicial Foreclosure. Upon the occurrence of any default hereunder,
Beneficiary shall have the option to declare all sums secured hereby immediately
due and payable and foreclose this Trust Deed in the manner provided by law for
the foreclosure of mortgages on real property and Beneficiary shall be entitled
to recover in such proceeding all costs and expenses incident thereto, including
an attorney’s fee in such amount as shall be fixed by the court (including any
which may be awarded by an appellate court).

17. Successor Trustee. Beneficiary may appoint a successor trustee at any time
by filing for record in the office of the County Recorder of the county in which
the Property is situated, a substitution of trustee. From the time the
substitution is filed for record, the new trustee shall succeed to all the
powers, duties, authority and title of the trustee named herein or of any
successor trustee. Each such substitution shall be executed and acknowledged,
and notice thereof shall be given and proof thereof made, in the manner provided
by law.

18. Acceptance of Trust. Trustee accepts this Trust when this Trust Deed, duly
executed and acknowledged, is made a public record as provided by law. Trustee
is not obligated to notify any party hereto of pending sale under any other
Trust Deed or of any action or proceeding in which Trustor, Beneficiary, or
Trustee shall be a party, unless brought by Trustee.

19. Parties. This Trust Deed shall apply to, inure to the benefit of, and bind
all parties hereto, their heirs, legatees, devisees, administrators, executors,
successors and assigns. All obligations of Trustor hereunder are joint and
several. The term “Beneficiary” shall mean the owner and holder, including any
pledgee, of the note secured hereby. In this Trust Deed, whenever the context
requires, the masculine gender includes the feminine and/or neuter, and the
singular number includes the plural.

20. Application of Payments. Unless applicable law provides otherwise, all
payments received by Beneficiary from or on behalf of Trustor, other than
payments made specifically for the purpose set forth in paragraph 5 hereof,
shall be applied by Beneficiary first in payment of amounts payable to
Beneficiary by Trustor under paragraph 5 hereof, if any, then against advances,
if any, made by Beneficiary pursuant to paragraph 6 of this Trust Deed, then to
costs, fees, expenses and other amounts incurred and advanced by the Beneficiary
in the enforcement of its rights hereunder, including, without limitation, costs
and reasonable attorneys’ fees described

 

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herein, then to unpaid service fees, then to interest due under the Note, then
to principal due under the Note, then to unpaid late charges, if any, then to
interest on any Future Advances made at Beneficiary’s option pursuant to
paragraph 24 hereof, then to principal on any Future Advances made at
Beneficiary’s option pursuant to Paragraph 24 hereof.

21. Acceleration upon Sale. If all or any part of the Property or an interest
therein is sold (or leased with an option to purchase) or transferred by Trustor
without Beneficiary’s prior written consent, excluding (a) a transfer by devise,
descent or by operation of law upon the death of a joint tenant, or (b) the
creation of a lien or encumbrance subordinate to this Trust Deed, Beneficiary
may, at Beneficiary’s option, declare all the sums secured by this Trust Deed to
be immediately due and payable. Beneficiary shall have waived such option to
accelerate if, and only if, prior to the sale (or lease with option to purchase)
or transfer, Beneficiary and the person to whom the Property is to be sold (or
leased) or transferred reach agreement in writing that the credit of such person
is satisfactory to Beneficiary and that the interest payable on the sums secured
by this Trust Deed shall be at such rate as Beneficiary shall request. If
Beneficiary has waived the option to accelerate as herein provided, and if
Trustor’s successor in interest has executed a written assumption agreement
accepted in writing by Beneficiary, Beneficiary shall release Trustor from all
obligations under this Trust Deed and the Note. If Beneficiary exercises such
option to accelerate, Beneficiary shall mail Trustor notice of acceleration.
Such notice shall provide a period of not less than fifteen (15) days from the
date the notice is mailed within which Trustor may pay the sums declared due. If
Trustor fails to pay such sums prior to the expiration of such period,
Beneficiary may, without further notice or demand on Trustor, invoke any
remedies provided in this Trust Deed or by law.

22. No Waiver; Remedies Cumulative. Any forbearance by Beneficiary in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy in the
future, and the waiver of Beneficiary of any default shall not constitute a
waiver of any other or subsequent default. The procurement of insurance or the
payment of taxes or other liens, charges or assessments by Beneficiary shall not
be a waiver of Beneficiary’s right to accelerate the maturity of the
indebtedness secured by this Trust Deed. All remedies provided in this Trust
Deed are distinct and cumulative to any other right or remedy under this Trust
Deed or afforded by law or equity, and may be exercised concurrently,
independently or successively.

23. Notices. Except for any notice required under applicable law or under the
Note to be given in another manner, (a) any notice to Trustor provided for in
this Trust Deed shall be given by mailing such notice by U.S. Mail, postage
prepaid (or such other more expeditious method as may be appropriate in the case
of foreign addresses, as Beneficiary may choose in its discretion), addressed to
Trustor at the Trustor’s address as set forth herein or in the Note, or at such
other address as Trustor may designate by notice to Beneficiary as provided
herein, and (b) any notice to Beneficiary shall be given by certified mail,
return receipt requested, (or in the case of a notice originating in a foreign
country, by such other method that results in the Beneficiary acknowledging in
writing, receipt of the notice), to Beneficiary’s address stated herein or to
such other address as Beneficiary may designate by notice to Trustor as provided
herein. Any notice provided for in this Trust Deed shall be deemed to have been
given to Trustor or Beneficiary when given in the manner designated herein.

24. Future Advances. Upon request by Trustor, Beneficiary, at Beneficiary’s
option, may make additional loans to Trustor. Such additional loans (“Future
Advances”), with interest thereon, shall be secured by this Trust Deed when
evidenced by promissory notes stating that said notes are secured hereby. At no
time shall the principal amount of the indebtedness secured by this Trust Deed,
not including sums advanced in accordance herewith to protect the security of
this Trust Deed, exceed one hundred fifty percent (150%) of the original amount
of the Note.

25. Abandonment; Amendments to Condominium Documents. Trustor shall not, except
after notice to Beneficiary and with Beneficiary’s prior written consent, either
partition or subdivide the Property or consent to:

(i) The abandonment or termination of MountainSide Condominium, except for
abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain;

(ii) Any amendment to any provision of the Declaration, By-Laws or Rules and
Regulations of the Condominium Association, or equivalent constituent documents
of MountainSide Condominium, which is for the express benefit of Beneficiary.

26. Provisions Severable. This Trust Deed shall be construed according to the
laws of the State of Utah. In the event that any provision or clause of this
Trust Deed or the Note conflicts with applicable law, such

 

404008.2 (09.14.09)

Page 6 of 8

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conflict shall not affect other provisions of this Trust Deed or the Note which
can be given effect without the conflicting provision. To this end the
provisions of the Trust Deed and the Note are declared to be severable.

27. Notice of Sale. The undersigned Trustor requests that a copy of any notice
of sale hereunder be mailed to him at the address hereinbefore set forth.

IN WITNESS WHEREOF, Trustor has executed this Trust Deed on the day and year
first written above.

Upon closing of the purchase to which this Trust deed applies, the undersigned
hereby authorize(s) closing agent to complete this Trust Deed by inserting the
appropriate date of the Trust Deed and to complete, as necessary, the recording
information relating to the documents by which the Resort Interest(s) being
encumbered by this Trust Deed was created.

 

TRUSTOR    (Name of Trust - Please Print or Type)

   (Name of Trustee - Please Print or Type)

By:       (Signature of Trustee) Print name: _________________________________

By:       (Signature of additional Trustee if required by Trust Agreement) Print
name: _________________________________

By:       (Signature of additional Trustee if required by Trust Agreement) Print
name: _________________________________

STATE OF                             

ss.

COUNTY OF                        

On                     , personally appeared before me
                                             , and
                                             , the signer(s) of the above
instrument, who duly acknowledged to me that         s/he        executed the
same.

 

   Printed Name of Notary:_______________________ Notary Public, State of
________________________ Commission No:_____________________________
Expiration:__________________________________

 

404008.2 (09.14.09)

Page 7 of 8

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REQUEST FOR FULL CONVEYANCE

(To be used only when indebtedness secured hereby has been paid in full)

 

TO: TRUSTEE

The undersigned is the legal owner and holder of the Note and all other
indebtedness secured by the within Trust Deed. Said Note, together with all
other indebtedness secured by said Trust Deed has been fully paid and satisfied;
and you are hereby requested and directed, on payment to you of any sums owing
to you under the terms of said Trust Deed, to cancel said Note above mentioned,
and all other evidences of indebtedness secured by said Trust Deed delivered to
you herewith, together with the said Trust Deed, and to reconvey, without
warranty, to the parties designated by the terms of said Trust Deed, all the
estate now held by you thereunder.

Dated:                     , 20      

   Signature of Holder

Mail Conveyance to:

STATE OF                             

ss.

COUNTY OF                        

On                     , personally appeared before me
                                                                  the signer(s)
of the above instrument, who duly acknowledged to me that he executed the same.

 

   Printed Name of Notary:_______________________ Notary Public, State of
________________________ Commission No:_____________________________
Expiration:__________________________________

 

404008.2 (09.14.09)

Page 8 of 8

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VIRGINIA SAMPLE (MVC)

UPON CLOSING OF THE PURCHASE TO WHICH THIS NOTE APPLIES, THE UNDERSIGNED HEREBY
AUTHORIZE(S) CLOSING AGENT OR HOLDER TO COMPLETE THIS NOTE BY INSERTING THE DATE
OF THIS NOTE AND THE APPLICABLE DATES FOR COMMENCEMENT OF PAYMENTS DUE
HEREUNDER, THE MONTHLY PAYMENT DATE AND THE FINAL PAYMENT DATE.

DEED OF TRUST NOTE

Manor Club at Ford’s Colony, a Time-Share Condominium

Timeshare Estate No(s): «CFID»

 

US $ «MTG_AMT»                                 (Date)

FOR VALUE RECEIVED, the undersigned «LEGAL_NAME» (herein after referred to as
“borrower”) promise(s) to pay to the order of MARRIOTT OWNERSHIP RESORTS, INC.,
a Delaware Corporation, the principal sum of «Mtg_Amt» U.S. Dollars ($
«MTG_AMT»), with interest on the unpaid balance from
                                    , until paid, at the rate of «Int_Rate»
percent («INT_RATE» %) per annum, both principal and interest being payable,
without offset, at P.O. Box 24747, Lakeland, Florida 33802, or at such other
place as the Holder of this Deed of Trust Note (hereinafter referred to as
“Holder”) may designate in writing as follows:

Principal and interest shall be due and payable in equal installments of
«Pay_Amt» Dollars ($«PAY_AMT»), each on                                     ,
and on the                     day of every month thereafter until
                                    , when the remaining principal balance and
all accrued and unpaid interest thereon shall be due and payable. Interest shall
be paid for the actual number of days elapsed based on a 360 - day year. Each
payment shall be applied first to interest and other charges due hereon before
application to principal.

The principal balance may be prepaid, in whole or in part, at any time or from
time to time without a penalty; provided, however, that Holder may require that
any partial prepayments shall be made on the date monthly installments are due.
Any partial prepayment in excess of the interest then accrued shall be applied
against the principal amount outstanding but shall not postpone the due date of
any subsequent monthly installments or change the amount of such installments.

Each monthly payment shall be tendered with a «SFEE» service fee.

The undersigned agree(s) to pay to the Holder of this note a “late charge” of
five percent (5%) of any payment which is not paid within ten (10) days after
its due date. The Holder may apply any payment received by it to the payment of
all late charges then owing before application to interest or principal. At its
option, such late charge is in addition to and not in lieu of or diminution of
any other rights and remedies of the Holder of this note.

Any of the following shall constitute a default hereunder: (i) the failure to
make any payment hereunder when due; or (ii) a default under the deed of trust
securing this note. Upon the happening of a default the entire unpaid principal
balance of this note and all accrued but unpaid interest, if any, shall, at the
option of the Holder, immediately become due and payable. Any failure of the
Holder to exercise such option shall not be deemed a waiver of the right to
exercise such option in the event of any subsequent default.

Each of the undersigned (i) waives presentment, protest and notice of dishonor;
(ii) waives the benefit of the homestead exemption and any other exemption which
may lawfully be waived as to the debt evidenced by this note; (iii) waives any
right to require the Holder to proceed against any other person; (iv) agrees
that, without notice to any party and without affecting any party’s liability,
the Holder may, at any time or times, grant extensions of time for payment to
any party, permit the renewal of this note or the substitution, exchange or
release of any security for this note and add or release a party; (v) agrees
that the undersigned’s obligations with respect to this note shall remain in
effect notwithstanding any other circumstances which might otherwise constitute
a legal or equitable discharge of obligations hereunder; (vi) agrees that this
note shall be construed in accordance with the laws of the Commonwealth of
Virginia and that any action to collect this note or any part hereof may be
instituted and maintained in a court having appropriate jurisdiction in the
County of James City, Virginia; (vii) agrees to pay all collection expenses,
including reasonable attorney’s fees and court costs incurred in the collection
of this note or any part hereof; and (viii) WAIVES, TO THE FULL EXTENT PERMITTED
BY LAW, ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR
COLLECT THIS NOTE OR RELATING TO THE DEED OF TRUST SECURING THIS NOTE, WHETHER
SUCH ACTION OR PROCEEDING IS INSTITUTED BY THE HOLDER, THE UNDERSIGNED OR ANY
OTHER PARTY.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

This note is secured by a deed of trust bearing the same date from the
undersigned to Jeffrey A. Holdaway, and J. Weili Cheng, Trustees, conveying a
Time-Share Estate(s) in Manor Club at Ford’s Colony, a Time-Share Condominium
located in the County of James City, Virginia, and which will be recorded in the
Clerk’s Office of the Circuit Court of that jurisdiction.

Witness the following signatures(s) and seal(s).

 

     (SEAL)   

BORROWER(S)’ ADDRESS:

«ADD1»

«ADD2»

«CSZC»

    

 

(SEAL)

       

 

(SEAL)

       

 

(SEAL)

  

(ma.note.yz) 09.03.09

476891_2

Loan «LOANID»

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VIRGINIA SAMPLE (MVC)

THIS INSTRUMENT PREPARED BY & RETURN TO:

Marriott Resorts Title Company, Inc.

1200 Bartow Road, Suite 10

Lakeland, Florida 33801

UPON CLOSING OF THE PURCHASE TO WHICH THIS DEED OF TRUST APPLIES, GRANTOR HEREBY
AUTHORIZE(S) CLOSING AGENT OR HOLDER OF THE NOTE TO DATE THIS DEED OF TRUST AND
INSERT THE MATURITY DATE OF THE NOTE.

DEED OF TRUST

THIS DEED OF TRUST is made as of                                         ,
between                      whose address is c/o Marriott Resorts Hospitality
Corporation, P. O. Box 890 Lakeland, Florida 33802 (“Grantor”, whether one or
more) and                      and                      whose address is
                                        , either of whom may act, as Trustees
(“Trustee”).

W I T N E S S E T H:

In consideration of the sum of Ten Dollars ($10.00) and other good and valuable
considerations, the receipt of which is hereby acknowledged, Grantor hereby
grants and conveys with General Warranty and, except as hereafter set forth,
English Covenants of Title, unto the Trustee, the real estate situated in the
County of James City, Virginia, and described as follows (the “Property”):

Time-Share Estate(s) In Condominium Unit «MVDATA1»

in the Time-Share Program located in James City County, Virginia and established
by that certain Time-Share Declaration for Manor Club at Ford’s Colony, a
Time-Share Condominium, dated May 11, 1993 and recorded in the Clerk’s Office of
the Circuit Court of James City County, Virginia (the “Clerk’s Office”) in Deed
Book 619 at page 1 (as amended and supplemented from time to time and including
all Exhibits and Appendices thereto, the “Time-Share Declaration”), and each
such Time-Share Estate constituting a one over fifty-one (1/51) undivided
interest in the Condominium Unit(s) described above in the Condominium
established by Declaration of Condominium of Manor Club at Ford’s Colony, a
Condominium, dated May 11, 1993 and recorded in the Clerk’s Office in Deed Book
618 at page 744 (as amended and supplemented from time to time and including the
Exhibits thereto, the “Declaration of Condominium”).

This conveyance is subject to (i) the Time-Share Declaration, (ii) the
Declaration of Condominium and (iii) other easements, conditions and
restrictions of record insofar as they may lawfully affect the Property.

This conveyance is made in trust to secure to the Holder thereof (“Holder”), the
payment of all sums owing under a certain note of even date herewith (the
“Note”) in the original principal sum of «MTG_TXT» U.S. Dollars (US $«MTG_AMT»),
with interest on the unpaid balance thereof as provided in the Note. The Note
was made by «LEGAL_NAME» payable to the order of Marriott Ownership Resorts,
Inc. at P.O. Box 8038, Lakeland, Florida 33802, or at such other place as the
Holder may designate in writing. Principal and interest are payable as specified
in the Note. If not sooner paid, the entire indebtedness evidenced by the Note
shall be due and payable on                     .

The Note contains provisions relating to the payment of late charges and
attorneys’ fees and the right of prepayment.

Grantor shall timely pay and perform its obligations under, and shall not
violate the terms and provisions of, the Time-Share Declaration and the
Declaration of Condominium and any rules and regulations promulgated in
connection therewith.

Subject to applicable law, upon written request by Holder to Grantor, Grantor
shall pay to Holder on the day when monthly installments of principal and
interest are payable under the Note, until the Note is paid in full, a sum
(herein “Funds”) equal to one-twelfth or such other fractional increments which
total 100% of the annual assessments due under the Time-Share Declaration
(herein “Maintenance Fees”), as reasonably estimated initially and from time to
time by Holder on the basis of assessments and bills and reasonable estimates
thereof.

 

   Page 1 of 3   

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If Holder exercises the foregoing right, the Funds shall be held in an
institution, the deposits or accounts of which are insured or guaranteed by a
Federal or state agency. Holder shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay the Maintenance Fees. Holder may not charge
for so holding and applying the Funds, analyzing said account or verifying and
compiling said assessments and bills, unless Holder pays to Grantor interest on
the Funds and applicable law permits Holder to make such a charge. Unless
applicable law requires, Holder shall not be required to pay Grantor any
interest on the Funds. Holder shall give to Grantor, without charge, an annual
accounting of the Funds showing credits and debits to the Funds and the purposes
for which each debit to the Funds was made. The Funds are hereby pledged as
additional security for the Note secured by this Deed of Trust.

If the amount of the Funds held by Holder, together with the future monthly
installments of Funds payable prior to the due date of Maintenance Fees, shall
exceed the amount required to pay such Maintenance Fees as they fall due, such
excess shall be, at Grantor’s option, either promptly repaid to Grantor or
credited to Grantor on monthly installments of Funds. If the amount of the Funds
held by Holder shall not be sufficient to pay Maintenance Fees as they fall due,
Grantor shall pay to Holder any amount necessary to make up the deficiency
within thirty (30) days from the date of a notice mailed by Holder to Grantor
requesting payment thereof.

Upon payment in full of all sums secured by this Deed of Trust, Holder shall
promptly refund to Grantor any Funds then held by Holder. If the Property is
conveyed to Holder or its nominee by deed in lieu of foreclosure, Holder shall
apply, no later than immediately prior to the sale of the Property or its
acquisition by Holder or its nominee, any Funds then held by Holder as a credit
against the Note secured by this Deed of Trust.

The indebtedness secured hereby is subject to acceleration or the terms thereof
being modified at the option of the Holder should the Property be sold or
conveyed without the prior written consent of Holder, which consent Holder shall
not be obligated to grant. Holder’s consent to such sale or conveyance shall not
relieve Grantor of Grantor’s obligations under the Note or hereunder.

This Deed of Trust shall be construed to impose and confer upon the parties
hereto, and the beneficiaries hereunder, all duties, rights and obligations
prescribed in Section 55-59 and Sections 55-59.1 through 55-59.4 of the Code of
Virginia (1950), as amended (the “Code”), and to incorporate the following by
short form reference to Sections 55-59.2 and 55-60 of the Code:

Deferred purchase money

Exemptions waived

Advertisement required: once a week for two (2) weeks

Subject to all (call) upon default

Renewal, extension or reinstatement permitted

Insurance required: As set forth in the Time-Share

Declaration and the Declaration of Condominium

Any Trustee may act

Substitution of any or all of the Trustees may be made at the discretion of
Holder for any reason whatsoever.

NOTICE - THE DEBT SECURED HEREBY IS SUBJECT TO CALL IN FULL OR THE TERMS THEREOF
BEING MODIFIED IN THE EVENT OF SALE OR CONVEYANCE OF THE PROPERTY CONVEYED.

All notices to Grantor hereunder or under Va. Code Ann. Sections 55-59.1 or
55-389 shall be in writing and sent by certified mail, return receipt requested,
at the address set forth beneath Grantor’s signature.

 

   Page 2 of 3   

 

(MA.MORT.1) 12.2.2011

     

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This Deed of Trust shall be construed in accordance with the laws of the
Commonwealth of Virginia and any action in connection with this Deed of Trust or
the Note shall be instituted and maintained in a court having appropriate
jurisdiction in the County of James City, Virginia. The prevailing party in any
such action shall be entitled to recover payment of all attorney’s fees and
court costs.

GRANTOR WAIVES, TO THE FULL EXTENT PERMITTED BY LAW, ANY RIGHT TO A TRIAL BY
JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR COLLECT THE NOTE OR RELATING TO
THIS DEED OF TRUST, WHETHER SUCH ACTION OR PROCEEDING IS INSTITUTED BY THE
HOLDER, GRANTOR OR ANY OTHER PARTY.

Witness the following signature(s) and seal(s).

 

        (SEAL)            (SEAL)            (SEAL)            (SEAL)   

Address for notices: as set forth in the Note

 

STATE OF

      

COUNTY OF

      

The foregoing instrument was acknowledged before me this                     ,
by                     

 

   Notary Public Print Name:_________________________________ Registration
No. :____________________________ Commission Expiration Date:__________________

(Notarial Seal)

(not required in Virginia)

 

 

Prepared by and return to: Marriott Resorts Title Company, Inc.

1200 Bartow Road, Suite 10, Lakeland, Florida 33801

 

   VIRGINIA: City of Williamsburg and County of James City, to-wit:   

This DEED was presented with the certificate annexed and admitted to record on
                    , 20       at             AM/PM

In the Clerk’s Office of the Circuit Court for the City of Williamsburg and
County of James City. The taxes imposed by the VA Code Section 58.1-801 802 &
814 have been paid.

STATE TAX                         LOCAL TAX                         ADDITIONAL
TAX

$                                             $                               
              $                    

TESTE: BETSY B. WOOLRIDGE, CLERK

 

BY:                                                                   
              , Deputy Clerk

 

   Page 3 of 3   

 

(MA.MORT.1) 12.2.2011

     

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ARUBA SAMPLE (MVC)

Upon closing of the purchase to which this Promissory Note applies, the
undersigned hereby authorizes the closing agent or Holder to complete this
Promissory Note by inserting the date of the Promissory Note and applicable
dates for commencement of payments due hereunder, the monthly payment date and
the final payment date.

PROMISSORY NOTE

Reference No(s):                     

[MVCIA Cooperative Association]

 

US$                           , 20    

FOR VALUE RECEIVED, the undersigned                                         
(“Borrower(s)”) promise(s) to pay to the order of MARRIOTT VACATION CLUB
INTERNATIONAL OF ARUBA, N.V. (said party or any other party to whom Marriott
Vacation Club International of Aruba, N.V. may transfer and assign this
Promissory Note and who holds this Promissory Note from time to time is
hereinafter called “Holder”), or order, at P.O. Box 8038, Lakeland, Florida
33802, or such other place as Holder may, from time to time designate, the
principal sum of                                          U.S. Dollars (US
$        ), with interest on the unpaid balance from
                                         until paid, at the rate of
                     percent simple interest per annum (    %) (calculated on
the basis of a 360-day year, collected for the actual number of days principal
is outstanding in any calendar year). Principal and interest shall be payable in
lawful money of the United States at Holder’s address set forth above, or such
other place as Holder may, from time to time, designate in writing, in
consecutive monthly installments of                     
                                         U.S. Dollars (US $        ), on the
                     day of each month and continuing thereafter on the same day
of each month beginning                                          , for a period
of              months with the remaining unpaid principal balance, together
with accrued interest thereon and any other amounts due and payable to Holder by
Borrower(s), if not sooner paid, on                                         .

The indebtedness evidenced by this Promissory Note is secured by that certain
Collateral as defined in the Pledge and Security Agreement dated of even date
herewith, executed by Borrower(s), as Debtor, in favor of Holder, as Secured
Party (the “Pledge and Security Agreement”). Reference is made to the Pledge and
Security Agreement for rights upon default and acceleration of the indebtedness
evidenced by this Promissory Note.

Each monthly payment shall be tendered with a $4.00 service fee.

Borrower(s) shall pay to Holder a late charge of six percent (6%) of any monthly
installment not received by Holder within ten (10) days after the date the
installment is due. The late charge shall be payable along with the next payment
due and may, at Holder’s option, be deducted from the next monthly installment
received by Holder if not paid by Borrower along such monthly installment.

Each payment shall be credited first to amounts due pursuant to Section 4 of the
Pledge and Security Agreement, then to advances, if any, made by Holder pursuant
to Section 8 of the Pledge and Security Agreement, then to the costs, fees,
expenses and other amounts incurred and advanced by Holder in the enforcement of
its rights hereunder and under the Pledge and Security Agreement, including,
without limitation, costs and reasonable attorney’s fees, then to unpaid service
fees, if any, then to interest due hereunder, then to principal due hereunder,
then to unpaid late charges, if any, then to interest due on Future Advance, if
any, made pursuant to Section 14 of the Pledge and Security Agreement, then to
principal of any Future Advances, if any, made pursuant to Section 14 of the
Pledge and Security Agreement.

Borrower(s) may prepay the principal amount outstanding in whole or in part at
any time without incurring any penalty. Any partial prepayment in excess of the
interest then accrued and any other amounts then due, shall be applied against
the principal amount outstanding but shall not postpone the due date of any
subsequent monthly installment payment or change the amount of any such
installment payment.

Demand, presentment, notice of dishonor, notice of default and protest are
hereby waived by all Borrowers, makers, sureties, guarantors and endorsers
hereof. This Promissory Note shall be a joint and several obligation of all
Borrowers, makers, sureties, guarantors and endorsers, and shall be binding upon
each and each of their heirs, personal representatives, successors and assigns,
as applicable.

At the option of Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon the occurrence of any one of the following events of
default:

 

  a) Failure of Borrower(s) to pay when due any monthly installment or any other
sums payable hereunder in accordance with the terms provided herein which
remains unpaid after a date specified in a notice (not less than fifteen
(15) days from the date such notice is mailed) from Holder to Borrower(s).

 

  b) The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s).

 

  c) Any default by Borrower(s) under the Pledge and Security Agreement or any
of the documents or agreements governing, related to or affecting the Collateral
or Borrower(s)’ interest therein.

Holder may exercise its option to accelerate this Promissory Note upon the
occurrence or continuation of any default by Borrower(s) regardless of any prior
forbearance. If this Promissory Note is not paid when due, whether at maturity
or by acceleration, Holder shall be entitled to collect all reasonable costs and
expenses of collection, including, but not limited to, reasonable attorney’s
fees, whether or not action be instituted hereon, and costs of trial and
appellate proceedings.

In the event of any default by Borrower(s) hereunder, Holder at its sole option,
may charge Borrower(s) the highest interest rate allowed by law and/or pursue
any and all remedies available to it under applicable law.

 

456992-2 06.19.09

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Any notice to Borrower(s) provided for in this Promissory Note shall be deemed
to have been given upon depositing same in any U.S. post office, postage
prepaid, addressed to Borrower(s) at the address stated below, or to such other
address as Borrower(s) may designate by written notice to Holder. Any notice to
Holder shall be given by mailing such notice by certified mail, return receipt
requested, to Holder at the address stated in the first paragraph of this
Promissory Note, or at such other address as may have been designated by written
notice to Borrower(s). Any notice provided for in this Promissory Note shall be
deemed to have been given to Borrower(s) or Holder when given in the manner
herein designated.

THIS PROMISSORY NOTE SHALL BE GOVERNED BY, CONSTRUED UNDER AND INTERPRETED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF FLORIDA, UNITED STATES, AND ENGLISH
SHALL BE THE GOVERNING LANGUAGE OF THIS PROMISSORY NOTE. THE COURTS OF ORANGE
COUNTY IN THE STATE OF FLORIDA SHALL BE THE EXCLUSIVE COURTS OF JURISDICTION AND
VENUE FOR ANY LITIGATION OR OTHER PROCEEDINGS THAT MAY BE BASED ON, ARISING OUT
OF, UNDER OR IN CONJUNCTION WITH THIS PROMISSORY NOTE, UNLESS OTHERWISE REQUIRED
BY APPLICABLE LAW. HOLDER AND BORROWER(S) HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONJUNCTION WITH THIS
PROMISSORY NOTE, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION IS A
MATERIAL INDUCEMENT FOR HOLDER EXTENDING THE LOAN EVIDENCED BY THIS PROMISSORY
NOTE.

Wherever possible, each provision of this Promissory Note shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision of this Promissory Note shall be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Promissory Note.

It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Promissory Note is accelerated by reason of an election by
Holder or if this Promissory Note is prepaid prior to maturity, all unearned
interest, if any, shall be canceled automatically, or, if theretofore paid,
shall either be refunded to Borrower(s) or credited to the unpaid principal
amount of this Promissory Note, whichever remedy is chosen by Holder; (ii) the
aggregate of all interest and other charges constituting interest under
applicable law, and contracted for, chargeable or receivable under this
Promissory Note or otherwise in connection with this loan transaction shall
never exceed the maximum amount of interest, nor produce a rate in excess of the
maximum non-usurious rate of interest, that Holder may charge Borrower(s) under
applicable law and in regard to which Borrower(s) may not successfully assert
the claim or defense of usury; and (ii) if any excess interest is provided for
or collected, it shall be deemed a mistake and the same shall either be refunded
to Borrower(s) or credited on the unpaid principal amount hereof, and this
Promissory Note shall be automatically deemed reformed so as to permit only the
collection of the maximum non-usurious rate and amount of interest allowable
under applicable law.

Time is of the essence in the performance of each and every obligation
represented by this Promissory Note.

 

BORROWER’S ADDRESS:     BORROWER(S):

 

   

 

   

 

    (Signature of Borrower)    

 

    (Printed Name)

 

   

 

    (Signature of Co-Borrower)

 

       

 

    (Printed Name)

 

    Taxpayer ID Number    

(Execute Original Only)

 

 

456992-2 06.19.09   -2-  

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ARUBA SAMPLE (MVC)

Upon closing of the purchase to which this Agreement applies, the undersigned
hereby authorizes the closing agent or Secured Party to complete this Agreement
by inserting the appropriate date of this Agreement.

Reference No(s)                    

PLEDGE AND SECURITY AGREEMENT

(Marriott Vacation Club International of Aruba, N.V.)

THIS PLEDGE AND SECURITY AGREEMENT (“SECURITY AGREEMENT”) is made this
             day of                     , 20      , between
                                                                             ,
whose address is                                          
                                    (“Debtor”), and MARRIOTT VACATION CLUB
INTERNATIONAL OF ARUBA, N.V. (“MVCIA), having an address at Post Office
Box 8038, Lakeland, Florida 33802, and its successors and/or assigns (“MVCIA” or
the “Secured Party”).

RECITALS

A. MVCIA has established a timeshare plan (the “Plan”) described in a plan
offering statement (“POS”) with respect to a timeshare project known as
Marriott’s Aruba Ocean Club (the “Resort”).

B. Debtor has purchased from MVCIA,              shares (the “Shares”) of
Marriott Vacation Club International of Aruba Cooperative Association (the
“Association”), together with all rights associated with, arising out of or
related to the Shares and as a member of the Association, including the right to
utilize a residential unit of the type and designation described in that certain
Share Purchase Agreement between MVCIA and Debtor dated                     
(the “Unit”) and the common facilities at the Resort as described in the POS
(collectively the “Collateral”).

C. The Association is governed by Articles of Association, Bylaws and rules,
regulations and procedures established by the Association’s Board of Directors,
as may be amended from time to time (the “Governing Documents”).

D. As part of the purchase price paid by Debtor to MVCIA for the purchase of the
Shares, Debtor has executed and delivered to MVCIA, a Promissory Note dated the
date hereof in the amount of                                          
                U.S. Dollars ($            ) (the “Note”).

NOW, THEREFORE, in consideration of the mutual covenants and promises set forth
herein, Debtor and Secured Party agree as follows:

1. CREATION OF SECURITY INTEREST. Debtor hereby pledges, assigns and grants to
Secured Party, a security interest in the Collateral, to secure the performance
and payment of the Note, all expenditures made or advanced by Secured Party for
taxes, insurance, repairs to and for maintenance of the Unit or the other
amounts required to be paid by Debtor in the form of annual dues, assessments,
maintenance fees and other financial obligations as set forth in the Governing
Documents with respect to, in relation to or for the use of the Unit and the
common facilities described in the POS; all costs and expenses incurred by
Secured Party in the collection and enforcement of the Note and other
obligations of Debtor; future advances, if any, made pursuant to Section 14
below (“Future Advances”), whether or not evidenced by notes to be made by
Debtor to Secured Party; and all liabilities of Debtor to Secured Party now
existing or hereafter incurred, matured or unmatured, direct or contingent, and
any renewals and extensions thereof and substitutions therefor.

2. DELIVERY OF COLLATERAL. Debtor has delivered to Secured Party and Secured
Party acknowledges receipt of Debtor’s original Share certificate(s), to be held
by Secured Party pursuant to the terms of this Agreement. Upon the occurrence of
an Event of Default as described in Section 11 below, Secured Party shall have
the right, as set forth hereinafter, to transfer to and to register in the name
of Secured Party or any of its nominees, any or all of the Shares. For all
purposes under the Florida Uniform Commercial Code (including, without
limitation, under

 

456958-2 06.19.09

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ARUBA SAMPLE (MVC)

 

§679.503 and §679.505) of the Florida Statutes possession of the original Share
certificate(s) by Secured Party shall be deemed possession of all of the
Collateral secured under this Security Agreement, and possession of such
original Share certificate(s) shall constitute peaceful possession of the
Collateral by Secured Party. Upon execution and delivery of this Agreement,
Secured Party shall notify the Association of Debtor’s pledge of the Shares and
Secured Party’s security interest in the Shares.

3. GENERAL OBLIGATIONS OF DEBTOR.

(a) Payment. Debtor shall pay to Secured Party, the sums evidenced by the Note
or any renewals or extensions thereof, in accordance with the terms of the Note
and shall pay and perform all other obligations that now exist or may hereafter
accrue from Debtor to Secured Party and the Association as set forth in the
Governing Documents.

(b) Representations, Warranties, and Covenants. Debtor represents, warrants and
covenants that:

(i) Debtor is the legal and beneficial owner of the Shares and other Collateral,
free and clear of any lien, security interest, option or other charge or
encumbrance except for the security interest created by this Agreement.

(ii) The pledge of the Shares pursuant to this Agreement creates a valid, first
priority security interest in the Shares, which security interest has been
perfected upon possession of the Shares by Secured Party.

(iii) Debtor has used the proceeds of the Note solely to purchase the Shares and
for no other purpose.

(c) Performance by Debtor. Debtor shall perform all the covenants and agreements
set forth in this Security Agreement, including, but not limited to, prompt
payment when due the principal of and interest on the indebtedness evidenced by
the Note, late charges as provided in the Note, reasonable service charges
imposed by Secured Party for servicing the loan account and the principal of and
interest on any future advances secured by this Security Agreement.

(d) Preservation of Collateral. Debtor shall pay promptly when due all
assessments, maintenance fees, taxes and membership dues payable with respect to
the Shares and do all other things and take all other actions required to
preserve the Collateral.

4. ESCROW FUNDS. (a) Subject to applicable law, upon written request by Secured
Party to Debtor, Debtor shall pay to Secured Party on the day when monthly
installments of principal and interest are payable under the Note, until the
Note is paid in full, an amount (the “Funds”) equal to one-twelfth (1/12) of
Debtor’s share of the yearly taxes and assessments relating to the Unit, and
one-twelfth (1/12) of the annual maintenance fees and other assessments and
charges due under the Governing Documents, all as reasonably estimated initially
and from time to time by Secured Party. If Secured Party exercises the foregoing
right, the Funds shall be held in an institution, the deposits or accounts of
which are insured or guaranteed by a federal or state agency. Lender shall apply
the Funds, upon receipt of the appropriate bill(s), to pay said taxes, fees and
assessments. Lender may not charge for so holding and applying the Funds,
analyzing said account or verifying or compiling said assessments and bills,
unless Secured Party pays to Debtor interest on the Funds and applicable law
permits Lender to make such a charge. Unless applicable law requires, Secured
Party shall not be required to pay Debtor any interest on earnings on the Funds.
Secured Party shall give to Debtor, without charge, an annual accounting of the
Funds showing credits and debits to the Funds and the purposes to which each
debit to the Funds was made. The Funds are hereby pledged as additional security
for the sums secured by this Security Agreement.

(b) If the amount of the Funds held by Secured Party, together with the future
monthly installments of the Funds payable prior to the due dates of taxes, fees,
assessments and other charges, shall exceed the amount required to pay such
taxes, fees, assessments and charges as they come due, such excess shall be, at
Debtor’s

 

456958-2 06.19.09

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ARUBA SAMPLE (MVC)

 

option, either promptly repaid to Debtor or credited to Debtor’s future monthly
installments of the Funds. If the amount of the Funds held by Secured Party
shall not be sufficient to pay taxes, fees, assessments and other charges as
they come due, Debtor shall pay to Secured Party any amount necessary to make up
the deficiency within thirty (30) days from the date of a notice mailed by
Secured Party to Debtor requesting payment thereof, but in no event shall
Secured Party require payment in advance for taxes, fees, assessments or other
charges to be held and disbursed as set forth hereunder in an amount which
exceeds the estimate of the next year’s amount for same.

(c) Upon payment in full of all sums secured by this Security Agreement, Secured
Party shall promptly refund to Debtor any Funds held by Secured Party. Upon an
Event of Default, Secured Party may apply any Funds then held by Secured Party
as a credit against the sums secured by this Security Agreement.

5. APPLICATION OF PAYMENTS. Unless Florida law provides otherwise, all payments
received by Secured Party under the Note and this Security Agreement shall be
applied by Secured Party, first in payment of any assessments, maintenance fees,
taxes, memberships dues and other charges, if any, required to be paid pursuant
to Section 4 of this Security Agreement; then to repayment of advances, if any,
made pursuant to Section 8 of this Security Agreement, which have been paid by
Secured Party to protect its security interest; then to the costs, fees,
expenses and other amounts incurred and advanced by Secured Party in the
enforcement of its rights hereunder, including, without limitation, costs and
reasonable attorneys’ fees; then to unpaid service fees, if any; then to
interest payable on the Note; then to the principal of the Note; then to unpaid
late charges pursuant to the Note, if any; then to interest payable on any
Future Advances made pursuant to Paragraph 14 hereof; and, then to the principal
of any Future Advances made pursuant to Paragraph 14 hereof.

6. VOTING AND OTHER RIGHTS.

(a) Voting Rights. So long as no Event of Default shall have occurred and be
continuing under this Security Agreement or the Note, Debtor shall be entitled
to exercise any and all voting and other consensual rights of Debtor, if any,
pertaining to the Shares or membership in the Association, for any purpose not
inconsistent with the terms of this Security Agreement.

(b) Other Rights. Upon the occurrence and during the continuance of an Event of
Default under this Security Agreement or the Note, all rights, if any, to
exercise the voting and other consensual rights with respect to the Shares which
Debtor would otherwise be entitled to exercise shall, upon notice from Secured
Party cease, and all such rights shall thereupon become vested in Secured Party
which shall thereafter have the sole right to exercise such voting and corporate
rights at any meeting of the members of the Association and exercise any and all
rights of conversion, exchange, subscription or any other rights, privileges or
options pertaining to any of the Shares as if it were the absolute owner
thereof, including, without limitation, the right to exchange any and all of the
Shares upon the merger, consolidation, reorganization, capitalization or other
readjustment of the Association. In order to further evidence the rights
provided in this paragraph, this Security Agreement shall be deemed to
constitute a proxy from Debtor to Secured Party to be effective immediately upon
the occurrence of an Event of Default.

7. ALIENATION OF COLLATERAL. Debtor shall not, without the prior written consent
of Secured Party (which consent may be withheld in the sole discretion of
Secured Party), sell, transfer, further encumber or otherwise dispose of the
Collateral or any rights therein, until this Security Agreement and all
obligations secured hereby have been fully satisfied.

8. REIMBURSEMENT OF EXPENSES. Secured Party may at any time, at its option,
perform or cause to be performed with respect to the Collateral, for and on
behalf of Debtor, any actions, obligations or covenants relating to the
Collateral that Debtor has failed or refused to perform. All sums so expended
shall bear interest from the date of payment at the interest rate set forth in
the Note, shall be payable at the place designated in the Note, and shall be
secured by this Security Agreement.

9. TIME OF PERFORMANCE. When performing any act under this Security Agreement
and the Note secured thereby, time shall be of the essence.

 

456958-2 06.19.09

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ARUBA SAMPLE (MVC)

 

10. WAIVER. Failure of Secured Party to exercise any right or remedy, including,
but not limited to, the acceptance of partial or delinquent payments, shall not
be a waiver of any obligation of Debtor or right of Secured Party or constitute
a waiver of any other similar default subsequently occurring.

11. EVENTS OF DEFAULT. The following shall be “Events of Default” under this
Security Agreement:

(a) A breach by Debtor of any term, covenant, condition, obligation or agreement
under this Security Agreement, the Note or any of the Governing Documents with
respect to the Shares, involving the failure to make any payment, including the
payment of principal, interest, assessments, maintenance fees, taxes and
membership dues.

(b) A breach by Debtor of any covenant, condition, obligation or agreement under
this Security Agreement, the Note or the Governing Documents with respect to the
Shares, which does not involve the failure to make any payment, and which breach
shall continue for thirty (30) days after notice from Secured Party of the
occurrence thereof.

(c) Any representation or warranty by Debtor in this Security Agreement proves
to be false, incorrect or misleading in any material respect.

(d) Debtor shall transfer title to or ownership of the Shares unless otherwise
permitted by this Security Agreement.

(e) The filing of a petition seeking relief under any federal or state
bankruptcy or insolvency laws or the making of an assignment for the benefit of
creditors by Debtor.

12. REMEDIES. On any Event of Default, and at any time thereafter:

(a) Secured Party may declare all obligations secured by this Security Agreement
(including, without limitation, pursuant to the Note) immediately due and
payable and may proceed to enforce payment of the same and exercise any and all
of the rights and remedies provided by Article 9 of the Uniform Commercial Code
of the State of Florida (Section 679.101 et seq., Florida Statutes (1996)) as
well as any and all other rights and remedies available to Secured Party whether
under the laws of the State of Florida or any other jurisdiction or otherwise,
including without limitation the right to retain the Shares in satisfaction of
the payment and performance due to Secured Party, as provided under the
Governing Documents or otherwise available to Secured Party.

(b) Retain all of the Shares and cause the Association’s transfer agent or
secretary to transfer title to the Shares to Secured Party or Secured Party’s
nominee.

(c) Sell the Collateral at public or private sale conducted in accordance to
such practices as may be permitted by applicable law, upon which Secured Party
may add to the obligations owed to Secured Party, the expenses of collection,
sale and delivery of the Collateral and any other expenses incurred in enforcing
its rights pursuant to this Security Agreement, including, but not limited to,
reasonable attorneys’ fees and disbursements, costs, brokers’ commissions,
transfer fees and taxes.

(d) Any cash received by Secured Party in respect of any sale or other
realization upon all or any part of the Collateral shall be applied first to the
payment of all obligations owed to Secured Party as set forth in this Security
Agreement and any surplus thereafter remaining shall be paid over to Debtor or
whomsoever may lawfully be entitled to receive such surplus.

(e) Secured Party shall, without any further notice to Debtor, have the power,
at its election, to request that the Association initiate the process of
expulsion of Debtor from the Association in accordance with Article 10 of the
Association’s Articles of Association.

(f) The parties hereto hereby acknowledge and agree that the remedies provided
in the Note and the Security Agreement are not the exclusive remedies available
to Secured Party as a result of an Event of Default.

 

456958-2 06.19.09

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ARUBA SAMPLE (MVC)

 

13. ATTORNEY-IN-FACT. So long as Debtor has any obligation outstanding to
Secured Party under this Security Agreement or the Note, in consideration of
Secured Party’s agreement to advance the funds as provided in the Note, Secured
Party shall be, irrevocably appointed, from and after the occurrence of an Event
of Default, Debtor’s attorney-in-fact with respect to execution and delivery of
any agreements or documents, and with respect to all other rights of Debtor,
under or in relation to the Collateral including, without limitation, the Share
certificate(s), the Note and this Security Agreement.

14. FUTURE ADVANCES. Upon request by Debtor, Secured Party, at its option, may
make Future Advances to Borrower. Such Future Advances, with interest thereon,
shall be secured by this Security Agreement whether or not evidenced by
promissory notes stating that said notes are secured hereby. At no time shall
the principal amount of the indebtedness secured by the Security Agreement, not
including sums advanced pursuant to Section 8 of this Security Agreement, exceed
one hundred fifty percent (150%) of the original principal amount of the Note.

15. GOVERNING LAW. THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, CONSTRUED UNDER
AND ENFORCED ACCORDING TO THE LAWS OF THE STATE OF FLORIDA, ONE OF THE STATES OF
THE UNITED STATES OF AMERICA AND ENGLISH SHALL BE THE GOVERNING LANGUAGE OF THIS
AGREEMENT. THE PARTIES HEREBY WAIVE ANY RIGHT THEY MAY HAVE UNDER ANY APPLICABLE
LAW TO A TRIAL BY JURY WITH RESPECT TO ANY SUIT OR LEGAL ACTION WHICH MAY BE
COMMENCED BY OR AGAINST ANOTHER PARTY CONCERNING THE INTERPRETATION,
CONSTRUCTION, VALIDITY, ENFORCEMENT OR PERFORMANCE OF THIS SECURITY AGREEMENT.
IN THE EVENT ANY SUCH SUIT OR LEGAL ACTION IS COMMENCED BY A PARTY, THE OTHER
PARTIES HEREBY AGREE, CONSENT AND SUBMIT TO THE PERSONAL JURISDICTION OF THE
APPROPRIATE COURTS OF FLORIDA, LOCATED IN ORANGE COUNTY, WITH RESPECT TO SUCH
SUIT OR LEGAL ACTION, AND EACH PARTY ALSO HEREBY CONSENTS AND SUBMITS TO AND
AGREES THAT VENUE IN ANY SUCH SUIT OR LEGAL ACTION IS PROPER IN SAID COURT, AND
EACH PARTY HEREBY WAIVES ANY AND ALL PERSONAL RIGHTS UNDER APPLICABLE LAW OR IN
EQUITY TO OBJECT TO THE JURISDICTION AND VENUE IN SAID COURT AND COUNTY. SUCH
JURISDICTION AND VENUE SHALL BE EXCLUSIVE OF ANY OTHER JURISDICTION AND VENUE.
Wherever possible, each provision of this Security Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Security Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Security Agreement.

ANY HOLDER OF THIS CONSUMER CREDIT CONTRACT IS SUBJECT TO ALL CLAIMS AND
DEFENSES WHICH DEBTOR COULD ASSERT AGAINST THE SELLER OF GOODS OR SERVICES
OBTAINED WITH THE PROCEEDS HEREOF. RECOVERY HEREUNDER BY DEBTOR SHALL NOT EXCEED
AMOUNTS PAID BY DEBTOR HEREUNDER.

16. CONTINUING SECURITY INTEREST; TRANSFER OF NOTES. This Security Agreement
shall create a continuing security interest in the Collateral and shall
(i) remain in full force and effect until payment in full of all obligations
secured hereby, (ii) be binding upon Debtor and its successors and assigns,
(iii) inure to the benefit of Secured Party and its successors and assigns.
Without limiting the generality of the foregoing, Secured Party may assign or
otherwise transfer the Note to any other person or entity and such other person
or entity shall be entitled to all of the benefits of this Security Agreement.

17. AMENDMENTS. No amendment or waiver of any provision of this Security
Agreement nor consent to any departure by the parties herefrom, shall in any
event be effective unless the same shall be in writing and signed by the parties
hereto and in such event such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.

18. SEVERABILITY OF PROVISIONS. The provisions of this Security Agreement are
severable and if any clause or provisions shall be held invalid or unenforceable
in whole or the payment of any obligations secured hereby or in the terms and
conditions of any security held therefor Secured Party is hereby expressly given
the right at its

 

456958-2 06.19.09

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ARUBA SAMPLE (MVC)

 

option to proceed in the enforcement of this Security Agreement independently of
any other remedy or security Secured Party may at any time hold in connection
with the allegations secured hereby, and it shall not be necessary for Secured
Party to proceed upon or against and/or exhaust any other security or remedy
before proceeding to enforce this Security Agreement. No course or dealing
between the parties, nor any failure to exercise, nor any delay in exercising,
on the part of Secured Party, any right, power or privilege hereunder or under
the Note, shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege hereunder or under the Note preclude
any other or future exercise thereof or the exercise of any other right, power
or privilege.

IN WITNESS WHEREOF, the parties have executed this Security Agreement as of the
day and year first above written.

 

WITNESSES:     DEBTOR(S):           Witness signs here               Witness
printed name               2nd Witness signs here               2nd Witness’
printed name    

WITNESSES:     SECURED PARTY:    

MARRIOTT VACATION CLUB INTER

NATIONAL OF ARUBA, N.V.

      By:    

      Authorized Representative:    

 

456958-2 06.19.09

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USVI SAMPLE (MVC)

Upon closing of the purchase to which this Note applies, the undersigned hereby
authorize(s) closing agent or Holder to complete this Note by inserting the
applicable dates for commencement of payments due hereunder, the monthly payment
date and the final payment date. DO NOT DESTROY THIS NOTE. When paid in full,
this Note, with the Mortgage securing the same, will be surrendered to the
Borrower marked “CANCELLED” and a Satisfaction of Mortgage executed and
delivered to Borrower.

PROMISSORY NOTE

 

US $                                                

   Reference No.                                                      

                                                         [Place of execution]

                                                                    , 20      

FOR VALUE RECEIVED, the undersigned                                          
                                                (“Borrower(s)”) promise(s) to
pay to the order of MARRIOTT OWNERSHIP RESORTS (ST. THOMAS), INC., (said party
or any other party to whom Marriott Ownership Resorts (St. Thomas), Inc. may
transfer and assign this Note and who holds this Note from time to time is
hereinafter called the “Holder”), Post Office Box 24747, Lakeland, Florida
33802, or order, the principal sum of                                          
            No/100 U.S. Dollars (US $                                        )
plus interest, on the unpaid balance from the date of this Note, until paid, at
the rate of                                               percent
(                    %) per annum. Interest shall be calculated by applying the
stated annual rate against the unpaid principal for the actual number of days
elapsed divided by a 360 day year. Principal and interest shall be payable,
without offset, in lawful money of the United States at the Holder’s address set
forth above, or such other place as the Holder may, from time to time,
designate, in                                  consecutive monthly installments
of                                               No/100 U.S. Dollars
(US $                    ), beginning on the                              day of
                    ,              and continuing thereafter on the same day of
each month, with the remaining unpaid balance, together with accrued interest
thereon, due and payable, if not sooner paid, on
                                                             . The indebtedness
evidenced by this Note is secured by a Mortgage, dated of even date herewith,
creating a lien on the real property described therein (the “Property”), located
in St. Thomas, Virgin Islands. Reference is made to said Mortgage for rights of
the Holder upon acceleration of the indebtedness evidenced by this Note.

Terms not specifically defined herein shall have the meanings ascribed to them
in the Declaration of Condominium (the “Declaration of Condominium”) or the
Mortgage.

If any monthly installment is not received by the Holder within fifteen
(15) days after the date the installment is due, Borrower(s) shall pay to the
Holder a late charge of five percent (5%) of such late installment. Such late
charge is in addition to and not in lieu of or diminution of any other rights
and remedies of the Holder of this Note.

Each monthly payment will be applied as of its scheduled due date and will be
applied, first to amounts due pursuant to Paragraph 2 of the Mortgage, then to
advances, if any, made by the Holder pursuant to Paragraph 7 of the Mortgage,
then to the costs, fees, expenses and other amounts incurred and advanced by the
Holder in the enforcement of its rights hereunder, including, without
limitation, costs and reasonable attorneys’ fees, then to unpaid service fees,
then to interest due hereunder, then to principal due hereunder, then to unpaid
late charges, if any, then to interest on any Future Advances made pursuant to
Paragraph 20 of the Mortgage, then to principal on any Future Advances made
pursuant to Paragraph 20 of the Mortgage.

The principal balance may be prepaid, in whole or in part, at any time or from
time to time without a penalty. Any prepayment shall include interest to the
date it is made. Partial prepayments shall be applied to the installments in the
inverse order of their maturity. There will be no changes in the due date or in
the amount of the monthly payment unless the Holder agrees in writing to those
changes.

The makers, sureties, guarantors and endorsers hereof severally waive
presentment for payment, demand and notice of dishonor and nonpayment of this
Note, and consent to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Holder hereof with respect to the
payment or other provisions of this Note, and to the release of any security, or
any part thereof, with or without substitution. This Note shall be the joint and
several obligation of all makers, sureties, guarantors and endorsers, and shall
be binding upon them and their respective heirs, personal representatives,
successors and assigns.

At the option of the Holder, the entire unpaid principal amount outstanding and
accrued interest thereon shall become due and payable without demand or further
notice to Borrower(s) upon:

 

  a) Failure of Borrower(s) to pay when due any monthly installment payable
hereunder which remains unpaid after a date specified in a notice (not less than
thirty (30) days from the date such notice is mailed) from the Holder to
Borrower(s);

 

  b) The insolvency (however evidenced) of or the institution of proceedings in
bankruptcy by or against Borrower(s);

 

  c) The sale (or lease with option to purchase) or transfer of all or any part
of the Property or any interest therein without the prior written consent of the
Holder, excluding a transfer by devise, descent or by operation of law upon the
death of a joint tenant therein; or

 

  d) Failure of Borrower(s) to comply with the covenants of the Mortgage after
notice and failure to cure as provided in the Mortgage.

The Holder may exercise its option to accelerate during any default by
Borrower(s) regardless of any prior forbearance. If this Note is not paid when
due, whether at maturity or by acceleration, the Holder shall be entitled to
collect all reasonable costs and expenses of collection, including, but not
limited to, attorney’s fees, whether or not action be instituted hereon.

Any notice to Borrower(s) provided for in this Note shall be deemed to have been
given after mailing same by U.S. mail, postage prepaid (or such other more
expeditious method as may be appropriate in the case of foreign addresses, as
Holder may choose in its discretion), addressed to Borrower(s) at the address
stated below, or to such other address as Borrower(s) may designate by written
notice to the Holder. Any notice to the Holder shall be deemed to have been
given by mailing such notice by U.S. certified mail, return receipt requested
(or in the case of a notice originating in a foreign country, by such other
method that results in the Holder acknowledging in writing receipt of the
notice), at 1200 U.S. 98 South, Lakeland, Florida 33801, or at such other
address as may be designated by written notice to Borrower(s).

This Note shall be governed by, construed under and enforced in accordance with
the laws of the State of Florida, without regard for its conflict of law
provisions. Borrower(s) consent(s) to jurisdiction and venue in the courts
within United States Virgin Islands.

Wherever possible, each provision of this Note shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Note shall be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Note.

 

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It is the intention of Borrower(s) and Holder to conform strictly to the
applicable usury laws. It is, therefore, agreed that (i) in the event that the
maturity of this Note is accelerated by reason of an election by Holder or if
this Note is prepaid prior to maturity, all unearned interest, if any, shall be
canceled automatically, or, if theretofore paid, shall either be refunded to
Borrower(s) or credited to the unpaid principal amount of this Note, whichever
remedy is chosen by Holder; (ii) the aggregate of all interest and other charges
constituting interest under applicable law, and contracted for, chargeable or
receivable under this Note or otherwise in connection with this loan transaction
shall neither exceed the maximum amount of interest, nor produce a rate in
excess of the maximum non-usurious rate of interest that Holder may charge
Borrower(s) under applicable law and in regard to which Borrower(s) may not
successfully assert the claim or defense of usury; and (iii) if any excess
interest is provided for or collected, it shall be deemed a mistake and the same
shall either be refunded to Borrower(s) or be credited on the unpaid principal
amount hereof, and this Note shall be automatically deemed reformed so as to
permit only the collection of the maximum non-usurious rate and amount of
interest allowable under applicable law.

 

       BORROWER(S) ADDRESS: Borrower               Borrower              
Borrower              Borrower    

(Execute Original Only)

 

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USVI SAMPLE (MVC)

[UPON CLOSING OF THE PURCHASE TO WHICH THIS MORTGAGE APPLIES, THE UNDERSIGNED
HEREBY AUTHORIZE(S) CLOSING AGENT TO COMPLETE THIS MORTGAGE BY INSERTING THE
APPROPRIATE DATE OF THE MORTGAGE AND TO COMPLETE, AS NECESSARY, THE RECORDING
INFORMATION RELATING TO THE DOCUMENTS BY WHICH THE TIMESHARE INTEREST(S) BEING
ENCUMBERED BY THIS MORTGAGE WAS (WERE) CREATED]

MORTGAGE

THIS MORTGAGE, made this              day of                          ,
20             , by                                          
                                (“Borrower”) to MARRIOTT OWNERSHIP RESORTS (ST.
THOMAS), INC., a United States Virgin Islands corporation, the address of which
is No. 5 Estate Bakkeroe, St. Thomas, Virgin Islands 00802 (said party, its
successors and assigns is herein called “Lender”).

WHEREAS, Borrower is indebted to Lender in the principal sum of
                                         
                                        U.S. Dollars (US
$                                             ), which indebtedness is evidenced
by Borrower’s Promissory Note of even date herewith (“Note”), providing for
equal monthly installments of principal and interest, with the balance of the
indebtedness, due and payable, if not sooner paid, on
                                                 .

WITNESSETH, To secure for the benefit of the Lender (a) the repayment of the
indebtedness evidenced by the Note, with interest thereon, the payment of all
other sums, with interest thereon, advanced in accordance herewith to protect
the security of this Mortgage, and the performance of the covenants and
agreements of Borrower herein contained, and (b) the repayment of any future
advances, with interest thereon, made to Borrower by Lender pursuant to
Paragraph 20 hereof (“Future Advances”), and also in consideration of One
U.S. Dollar (U.S. $1.00), receipt whereof is hereby acknowledged, Borrower
irrevocably does grant, release, assign, transfer, set-over and mortgage to the
Lender the following-described mortgaged premises located in St. Thomas, United
States Virgin Islands and identified by that specific Timeshare Interest
Number(s) as follows:

Timeshare Interest Number                          with usage of a Unit on
                             [an annual/a biennial] basis within the
                     Season [and…repeat as needed], in Frenchman’s Cove
Condominium, located at Parcel No. 4-C-Rem, Parcel No. 4-C-2, Parcel No. 4-D,
Parcel No. 4-E, Parcel No. 4-F, Parcel No. 4-G, Parcel No. 4-H, and Parcel
No. 4-J Estate Bakkeroe No. 5 Frenchman’s Bay Quarter, St. Thomas, United States
Virgin Islands according to and as said terms and all other terms not otherwise
defined herein are defined in the Declaration of Condominium thereof, as
recorded as Document No. 2005006878 on July 14, 2005, respectively, as
subsequently expanded and amended (the “Declaration of Condominium”).

TOGETHER ALSO WITH the Timeshare Interest’s percentage interest in the Common
Elements as set forth in the Declaration of Condominium;

TOGETHER ALSO WITH the appurtenances and all the estate and rights of the
Borrower in and to the Timeshare Interest(s);

TOGETHER ALSO WITH the rents, issues and profits of the above-described
Timeshare Interest(s), including, without limitation, the Borrower’s right,
title and interest in the common profits.

TOGETHER ALSO WITH all awards heretofore and hereafter made for taking by
eminent domain the whole or any part of the aforedescribed property, rights and
interests or any easement therein, including any awards for changes of grade of
streets, which said awards are hereby assigned to the Lender, which is hereby
authorized, subject to the provisions of the Bylaws hereinafter identified, to
collect and receive the proceeds of such awards and to give proper receipts and
acquittances therefore, and to apply the same toward the payment of the mortgage
debt, notwithstanding the fact that the amount owing thereon may not then be due
and payable.

The above-described Timeshare Interest(s), together with the appurtenances,
rights, and other interests hereinabove or as described in said Declaration of
Condominium in connection with the Timeshare Interest(s) now or hereafter vested
or attached to or installed in the Unit(s) to which the Timeshare Interest(s) is
(are) appurtenant, are hereinafter collectively referred to as the “Mortgaged
Premises”.

TO HAVE AND TO HOLD the Mortgaged Premises unto the Lender, its successors and
assigns, forever.

PROVIDED, always that if the Borrower shall pay or cause to be paid unto the
Lender the said sum of money and the interest thereon on demand, then these
presents and the estate hereby granted shall cease, determine and be void.

For the purposes of this Mortgage, unless the context otherwise requires, the
terms used but not defined herein which are defined in the provisions of Chapter
33, Title 28, United States Virgin Islands Code (the “Condominium Act”) or the
aforedescribed Note or Declaration of Condominium shall have the meanings set
forth therein.

        Borrower covenants that Borrower is lawfully seized of the estate hereby
mortgaged and has the right to grant, release, assign, transfer, set-over and
mortgage the Mortgaged Premises to Lender, that the Mortgaged Premises is
unencumbered, and that Borrower will warrant and defend generally the title to
the Mortgaged Premises against all claims and demands, subject to any
declaration, easements, or restrictions listed in a schedule of exceptions to
coverage in any title insurance policy insuring Lender’s interest in the
Mortgaged Premises. Borrower further agrees and covenants with the Lender as
follows:

1. Payment of Principal, Interest, Late Charges and Service Fees. Borrower shall
promptly pay when due all payments due under the Note. Except as otherwise
provided by applicable law, all payments accepted and applied by Lender under
the

 

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Note and Paragraphs 1 and 2 hereof shall be applied in the following order of
priority: (a) interest due under the Note and Paragraph 20 hereof; (b) principal
due under the Note and Paragraph 20 hereof; (c) service fees, if any, due under
the Note; (d) late charges, if any, due under the Note; (e) amounts due under
Paragraph 2 hereof; (f) amounts due under Paragraph 7 hereof.

2. Funds for Taxes, Assessments and Insurance. Subject to applicable law, upon
written request by Lender to Borrower, Borrower shall pay to Lender on the day
when monthly installments of principal and interest are payable under the Note,
until the Note is paid in full, a sum (herein “Funds”) equal to one-twelfth of
Borrower’s share of the yearly taxes and assessments which may attain priority
over this Mortgage and one-twelfth of the annual Maintenance Fees due under the
Declaration of Condominium, all as reasonably estimated initially and from time
to time by Lender on the basis of assessments and bills and reasonable estimates
thereof.

If Lender exercises the foregoing right, the Funds shall be held in an
institution, the deposits or accounts of which are insured or guaranteed by a
federal or state agency. Lender shall apply the Funds, upon receipt of the
appropriate bill or bills, to pay said taxes and Maintenance Fees. Lender may
not charge for so holding and applying the Funds, analyzing said account, or
verifying and compiling said assessments and bills, unless Lender pays to
Borrower interest on the Funds and applicable law permits Lender to make such a
charge. Unless applicable law requires, Lender shall not be required to pay
Borrower any interest on earnings on the Funds. Lender shall give to Borrower,
without charge, an annual accounting of the Funds showing credits and debits to
the Funds and the purposes for which each debit to the Funds was made. The Funds
are hereby pledged as additional security for the sums secured by this Mortgage.

If the amount of the Funds held by Lender, together with the future monthly
installments of Funds payable prior to the due dates of taxes and/or Maintenance
Fees shall exceed the amount required to pay such taxes and/or Maintenance Fees
as they fall due, such excess shall be, at Borrower’s option, either promptly
repaid to Borrower or credited to Borrower on monthly installments of Funds. If
the amount of the Funds held by Lender shall not be sufficient to pay taxes
and/or Maintenance Fees as they fall due, Borrower shall pay to Lender any
amount necessary to make up the deficiency within thirty (30) days from the date
of a notice mailed by Lender to Borrower requesting payment thereof.

Upon payment in full of all sums secured by this Mortgage, Lender shall promptly
refund to Borrower any Funds held by Lender. If under Paragraph 17 hereof the
Mortgaged Premises is sold or the Mortgaged Premises is otherwise acquired by
Lender, Lender shall apply, no later than immediately prior to the sale of the
Mortgaged Premises or its acquisition by Lender, any Funds then held by Lender
as a credit against the sums secured by this Mortgage.

3. Application of Payments. Unless applicable law provides otherwise, all
payments received by Lender under the Note and Paragraphs 1 and 2 hereof shall
be applied by Lender first, in payment of amounts payable to Lender by
Borrower(s) under Paragraph 2 hereof, then against advances, if any, made by
Lender pursuant to Paragraph 7 hereof, then to costs, fees, expenses and other
amounts incurred and advanced by the Lender in the enforcement of its rights
under the Note and this Mortgage, including, without limitation, costs and
reasonable attorneys’ fees, then to unpaid service fees, then to interest
payable on the Note, then to the principal of the Note, then to unpaid late
charges, if any, then to interest on any Future Advances made at Lender’s option
pursuant to Paragraph 20 hereof, and then to principal on Future Advances, if
any, made at Lender’s option pursuant to Paragraph 20 hereof.

4. Charges; Liens. Borrower shall promptly pay, when due, all Maintenance Fees
imposed by the Association pursuant to the provisions of the Condominium
Documents. Borrower shall pay all taxes, Maintenance Fees and other charges,
fines and impositions attributable to the Mortgaged Premises which may attain a
priority over this Mortgage, in the manner provided under Paragraph 1 hereof or,
if not paid in such manner, by Borrower making payment, when due, directly to
the payee thereof. Borrower shall promptly furnish to Lender all notices of
amounts due under this Paragraph, and in the event Borrower shall make payment
directly, Borrower shall promptly furnish to Lender receipts evidencing such
payments. Borrower shall promptly discharge any lien which has priority over
this Mortgage; provided, that Borrower shall not be required to discharge any
such lien so long as Borrower shall agree in writing to the payment of the
obligation secured by such lien in a manner acceptable to Lender and if
requested by Lender, immediately post with Lender an amount necessary to satisfy
said obligation, or shall in good faith contest such lien by, or defend
enforcement of such lien in, legal proceedings which operate to prevent the
enforcement of such lien or forfeiture of the Mortgaged Premises or any part
thereof and, if requested by Lender, immediately post with Lender an amount
necessary to satisfy said obligation.

5. Hazard Insurance. Borrower shall keep the improvements now existing or
hereafter erected on the Mortgaged Premises insured against loss by fire,
hazards included within the term “extended coverage”, and such other hazards as
Lender may require and in such amounts and for such periods as Lender may
require; provided, that Lender shall not require that the amount of such
coverage exceed that amount of coverage required to pay the sums secured by this
Mortgage. This obligation shall be deemed satisfied so long as the Association
maintains a “master” or “blanket” policies for liability and casualty insurance
in accordance with the terms hereof.

The insurance carrier providing the insurance shall be chosen by Borrower or the
Association subject to approval by Lender; provided, that such approval shall
not be unreasonably withheld. If required, all premiums on insurance policies
shall be paid in the manner provided under Paragraph 2 hereof, or, if not paid
in such manner, by Borrower or the Association making payment, when due,
directly to the insurance carrier.

All insurance policies and renewals thereof shall be in a form acceptable to
Lender and shall include a standard mortgage clause in favor of and in a form
acceptable to Lender. Borrower shall give Lender prompt notice of any lapse in
hazard insurance coverage. In the event of loss, Borrower shall give prompt
notice to the insurance carrier and Lender. Lender may make proof of loss if not
made promptly by Borrower.

Pursuant to the terms of the Condominium Documents, insurance proceeds shall be
applied to restoration or repair of the property damaged, whether to the Unit or
the Common Elements. To the extent such insurance proceeds exceed the cost of
such restoration or repair and the Board of Directors of the Association decides
to disburse such excess, Borrower’s share of such excess shall be applied to the
sums secured by this Mortgage, with the excess, if any, paid to Borrower.

Unless Lender and Borrower otherwise agree in writing, any such application of
proceeds to principal shall not exceed or postpone the due date of the monthly
installments referred to in Paragraphs 1 and 2 hereof or change the amount of
such installments. If under Paragraph 18 hereof the Mortgaged Premises is
acquired by Lender, all right, title and interest of Borrower in and to any
insurance policies and in and to any excess insurance proceeds thereof from
damage to the Mortgaged Premises prior to the sale or acquisition shall pass to
Lender to the extent of the sums secured by this Mortgage immediately prior to
such sale or acquisition.

6. Preservation and Maintenance of Mortgaged Premises. Borrower shall keep the
Mortgaged Premises in good repair and shall not commit waste or permit
impairment or deterioration of the Mortgaged Premises. Borrower shall perform
all of Borrower’s obligations under the Condominium Documents. Borrower shall
take such actions as may be reasonable to insure that the Association maintains
a public liability insurance policy acceptable in form, amount, and extent of
coverage to Lender.

 

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7. Protection of Lender’s Security. If Borrower fails to perform the covenants
and agreements contained in this Mortgage, or if any action or proceeding is
commenced which materially affects Lender’s interest in the Mortgaged Premises,
including, but not limited to, eminent domain, insolvency, code enforcement, or
arrangements or proceedings involving a bankrupt or decedent, then Lender at
Lender’s option, upon notice to Borrower, may make such appearances, disburse
such sums and take such action as is necessary to protect Lender’s interest,
including, but not limited to, disbursement of funds to pay reasonable
attorneys’ fees and entry upon the Mortgaged Premises to make repairs.

Any amounts disbursed by Lender pursuant to this Mortgage, with interest
thereon, shall become additional indebtedness of Borrower secured by this
Mortgage. Unless Borrower and Lender agree to other terms or payment, such
amount shall be payable upon notice from Lender to Borrower requesting payment
thereof, and shall bear interest from the date of disbursement at the rate
payable from time to time on outstanding principal under the Note unless payment
of interest at such rate would be contrary to applicable law, in which event
such amounts shall bear interest at the highest rate permissible under
applicable law. Nothing contained in this Paragraph 7 shall require Lender to
incur any expense or take any action hereunder.

8. Inspection. Lender may make or cause to be made reasonable entries upon and
inspections of the Mortgaged Premises, provided that Lender shall give Borrower
notice prior to any such inspection specifying reasonable cause therefore
related to Lender’s interest in the Mortgaged Premises.

9. Condemnation. The proceeds of any award or claim for damages, direct or
consequential, payable to Borrower in connection with any condemnation or other
taking of all or part of the Mortgaged Premises, whether of the Unit(s) to which
the Timeshare Interest(s) is appurtenant or the Common Elements or for any
conveyance in lieu of condemnation, pursuant to the terms of the Condominium
Documents, shall be applied to the sums secured by this Mortgage, with the
excess, if any, paid to Borrower. Unless Lender and Borrower otherwise agree in
writing, any such application of proceeds to principal shall not extend or
postpone the due date of the monthly installments referred to in Paragraphs 1
and 2 hereof or change the amount of such installments.

10. Borrower Not Released. Extension of the time for payment or modification of
amortization of the sums secured by this Mortgage granted by Lender to any
successor in interest of Borrower shall not operate to release, in any manner,
the liability of the original Borrower and Borrower’s successors in interest.
Lender shall not be required to commence proceedings against such successor or
refuse to extend time for payment or otherwise modify amortization of the sums
secured by this Mortgage by reason of any demand made by the original Borrower
and Borrower’s successor in interest.

11. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising
any right or remedy hereunder, or otherwise afforded by applicable law, shall
not be a waiver of or preclude the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by
Lender shall not be a waiver of Lender’s right to accelerate the maturity of the
indebtedness secured by this Mortgage.

12. Remedies Cumulative. All remedies provided in this Mortgage are distinct and
cumulative to any other right or remedy under this Mortgage or afforded by law
or equity, and may be exercised concurrently, independently or successively.

13. Successors and Assigns Bound; Joint and Several Liability; Captions. Subject
to the terms and provisions of Paragraph 17 below, the covenants and agreements
herein contained shall bind, and the rights hereunder shall inure to, the
respective successors and assigns of Lender and Borrower. All covenants and
agreements of Borrower shall be joint and several. The captions and headings of
the Paragraphs of this Mortgage are for convenience only and are not to be used
to interpret or define the provisions hereof.

14. Notice. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Borrower provided for in this Mortgage shall
be given by mailing such notice by U.S. Mail, postage prepaid (or such other
more expeditious method as may be appropriate in the case of foreign addresses,
as Lender may choose in its discretion), addressed to Borrower at the Borrower’s
address as set forth in the Note, or at such other address as Borrower may
designate by notice to Lender as provided herein, and (b) any notice to Lender
shall be given by certified mail, return receipt requested (or in the case of a
notice originating in a foreign country, by such other method that results in
Lender acknowledging in writing receipt of the notice), to Lender’s address
stated herein or to such other address as Lender may designate by notice to
Borrower as provided herein. Any notice that is provided for in this Mortgage
shall be deemed to have been given to Borrower or Lender when given in the
manner designated herein.

15. Governing Law; Venue; Severability. This Mortgage shall be governed by the
laws of the United States Virgin Islands. Venue for any cause of action brought
under this Mortgage shall be in the courts on St. Thomas in the United States
Virgin Islands. In the event that any provision or clause of this Mortgage or
the Note conflicts with applicable law, such conflict shall not affect other
provisions of the Mortgage or the Note which can be given effect without the
conflicting provision, and to this end the provisions of the Mortgage and the
Note are declared to be severable.

16. Borrower’s Copy. Borrower shall be furnished a copy of the Note and this
Mortgage at the time of execution or after recordation hereof.

17. Transfer of the Mortgaged Premises; Assumption. If all or any part of the
Mortgaged Premises or an interest therein is sold or transferred by Borrower
without Lender’s prior written consent, excluding (a) a transfer by devise,
descent or by operation of law upon the death of a joint tenant, (b) the
creation of a purchase money security interest for household appliances, (c) the
grant of any leasehold interest of three (3) years or less not containing an
option to purchase, or (d) the creation of a lien or encumbrance subordinate to
this Mortgage, Lender may, at Lender’s option, declare all the sums secured by
this Mortgage to be immediately due and payable. Lender shall have waived such
option to accelerate if, and only if, prior to the sale or transfer, Lender and
the person to whom the Mortgaged Premises is to be sold or transferred reach
agreement in writing that the credit of such person is satisfactory to Lender
and that the interest payable on the sums secured by this Mortgage shall be at
such rate Lender shall request, and if the assumption fee set by Lender has been
paid. If Lender has waived the option to accelerate provided in this Paragraph
17, and if Borrower’s successor in interest has executed a written assumption
agreement accepted in writing by Lender, Lender shall release Borrower from all
obligations under this Mortgage, and the Note. Assumption of Borrower’s Mortgage
and Note shall be permitted only with written approval of, and at the sole
discretion of, Lender.

If Lender exercises such option to accelerate, Lender shall mail Borrower notice
of acceleration in accordance with Paragraph 14 hereof. Such notice shall
provide a period of not less than thirty (30) days from the date the notice is
mailed within which Borrower may pay the sums declared due. If Borrower fails to
pay such sums prior to the expiration of such period, Lender may, without
further notice or demand on Borrower, invoke any remedies permitted by Paragraph
18 hereof.

18. Acceleration; Remedies. Except as provided in Paragraph 17 hereof, upon
Borrower’s breach of any covenant or agreement of Borrower(s) in this Mortgage,
including the covenants to pay when due any sums secured by this Mortgage,
Lender, prior to acceleration, shall mail notice to Borrower, as provided in
Paragraph 14 hereof, specifying: (1) the breach; (2) the action required to cure
such breach; (3) a date, not less than thirty (30) days from the date the notice
is mailed to Borrower by which such breach must be cured; and (4) that failure
to cure such breach on or before the date specified in the notice may

 

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result in acceleration of the sums secured by this Mortgage, foreclosure by
judicial proceeding and sale of Mortgaged Premises. If the breach is not cured
on or before the date specified in the notice, Lender at Lender’s option,
subject to any right of reinstatement to which Borrower is entitled under
applicable law, may declare, without further demand, all of the sums secured by
this Mortgage to be immediately due and payable and may foreclose this Mortgage
by judicial proceedings. Lender shall be entitled to collect in such proceedings
all expenses of foreclosure, including, but not limited to, reasonable
attorneys’ fees, court costs, and costs of documentary evidence, abstracts and
title reports.

19. Assignment of Rents; Appointment of Receiver. As additional security
hereunder, Borrower hereby assigns to Lender the rents of the Mortgaged
Premises, provided that Borrower shall, prior to acceleration under Paragraph 18
hereof or abandonment of the Mortgaged Premises, have the right to collect and
retain such rents as they become due and payable. Upon acceleration or
abandonment of the Mortgaged Premises, Lender shall be entitled, without notice,
to enter upon, take possession of, and manage the Mortgaged Premises and to
collect the rents of the Mortgaged Premises, including those that are past due.
All rents collected shall be applied first to payment of the costs of management
of the Mortgaged Premises and collection of rents, including, but not limited
to, management fees, court costs, and reasonable attorneys’ fees, and then to
the sum secured by this Mortgage. The Lender shall be liable to account only for
those rents actually received. Borrower shall not be entitled to possession or
use of the Mortgaged Premises after abandonment or after the Lender has
accelerated the balance due. Alternatively, Lender may seek the appointment of a
receiver to manage and collect rents from the Mortgaged Premises. If a receiver
is appointed, any income from rents from the Mortgaged Premises shall be applied
first to the costs of receivership, and then in the order set forth above.

20. Future Advances. Upon request by Borrower, Lender, at Lender’s option, may
make future advances (“Future Advances”) to Borrower. Such Future Advances, with
interest thereon, shall be secured by this Mortgage whether or not evidenced by
promissory notes stating that said notes are secured hereby. At no time shall
the principal amount of the indebtedness secured by this Mortgage, not including
sums advanced in accordance herewith to protect the security of this Mortgage,
exceed one hundred fifty percent (150%) of the original amount of the Note.

21. Lender’s Prior Consent. Borrower shall not, except after notice to Lender
and with Lender’s prior written consent, which consent may be withheld by Lender
in its sole and absolute discretion, either partition or subdivide the Mortgaged
Premises or consent to: (i) the abandonment or termination of the Condominium,
except for abandonment or termination required by law in the case of substantial
destruction by fire or other casualty or in the case of a taking by condemnation
or eminent domain; (ii) any amendment to any provision of the Condominium
Documents which is for the express benefit of Lender; (iii) and amendment that
could adversely affect the Lender’s security interest in the Mortgaged Premises;
or (iv) any action which would have the effect of rendering the public liability
insurance coverage maintained by the Association unacceptable to Lender.

22 Remedies. In the event Borrower defaults in payment of the Note secured
hereby or in the performance of any covenants herein set forth, then the Lender
shall have all legal and equitable remedies available to it under United States
Virgin Islands law. In addition, Lender shall have the automatic right, without
the appointment of a receiver, to have access to and exclusive possession of the
Timeshare Interest(s) encumbered hereby or such other Timeshare Interest(s)
whose use has been assigned to Borrower by the Association or by any exchange
company. This right to exclusive occupancy and possession shall entitle, but
shall not obligate, Lender to receive and retain any rental payments to which
Borrower would otherwise be entitled, which are received by Lender or any of its
related companies, or by the Association or any other rental agent.

Lender may implement the remedies provided herein by, among other methods,
giving notice of default to the Borrower, the Association and the Management
Company responsible for the administration and management of the Mortgaged
Premises encumbered hereby.

If the Borrower fails to deliver to Lender and to the Management Company an
affidavit setting forth facts contesting the default alleged by Lender prior to
the date Borrower’s use of a Unit pursuant to the Condominium Documents
commences, then the Management Company shall thereupon be entitled to deliver
possession of the Unit or the rental, net only of any rental management fee, if
any, to Lender. Lender, the Association and the Management Company shall be
released from any claims by Borrower in connection with the exercise by Lender
of remedies herein described.

23. Attorneys’ Fees. As used in this Mortgage and in the Note, “attorneys’ fees”
shall include attorneys’ fees, if any, which may be awarded by a trial or an
appellate court.

IN WITNESS WHEREOF, Borrower has executed this Mortgage.

 

          First Witness signs here     Borrower          

Second Witness signs here

(Notary may sign as 2nd witness)

    Borrower              Borrower              Borrower

 

STATE OF                                          
                               )

ss:

COUNTY OF                                                                      )

This foregoing instrument was acknowledged before me this                     
day of                                                  , 20             by
                                         
                                                                .

WITNESS my hand and this official seal.

 

         [ S E A L ]     Notary Public WHEN RECORDED RETURN TO:         My
commission expires:                                          
                   

 

Page 4 of 5

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James H. Hindels, Esq., H.C.

Birch, deJongh & Hindels

Poinsettia House at Bluebeard’s Castle

1330 Estate Taarnebjerg

St. Thomas, Virgin Islands 00802

 

Page 5 of 5

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Exhibit C

Form Of Lost Note Affidavit

 

STATE OF  

 

COUNTY OF  

 

             (“Affiant”), on behalf of and as              of MORI SPC Series
Corp., a Delaware special purpose corporation (the “Seller”), being duly sworn,
deposes and says:

1. This Lost Note Affidavit is being delivered by the Affiant pursuant to
Section [2(b)] of the Amended and Restated Sale Agreement (the “Agreement”),
dated as of September 1, 2012, by and between the Seller and Marriott Vacations
Worldwide Owner Trust 2011-1, a Delaware statutory trust, as the Issuer, which
Section requires the Seller to deliver Timeshare Loan Files to the Custodian on
behalf of the Issuer. Unless otherwise defined herein, capitalized terms have
the meanings ascribed to such terms in the Agreement and the Standard
Definitions thereto.

2. That                      has issued an Obligor Note evidencing a Timeshare
Loan dated              in the principal amount of $         (the “Original
Note”) to             .

3. The Original Note has been lost, destroyed, or stolen so that it cannot be
found or produced, and the Seller has not endorsed, assigned, sold, pledged,
hypothecated, negotiated or otherwise transferred the Original Note or an
interest therein.

4. That the Seller has made a diligent effort to find the Original Note.

5. It is understood by the Seller that if the Original Note is found, that it
will surrender said Original Note to the Custodian or its permitted successors
and assigns for cancellation.

 

 

The foregoing affidavit was sworn to and subscribed before me this      day of
            ,             , by             , as                      of [MORI
SPC Series Corp.], who is personally known to me or who has produced
                     as identification and who did take an Oath.

 

   

 

(AFFIX NOTARIAL SEAL)

    Notary Public, State of  

 

      (Name) Commission Number:  

 

    My Commission Expires:

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Exhibit D

FORM OF ADDITIONAL TIMESHARE LOAN SUPPLEMENT

ADDITIONAL TIMESHARE LOAN SUPPLEMENT NO.      (this “Supplement”) dated as of
            , by and between MORI SPC SERIES Corp., a Delaware special purpose
corporation, as seller (the “Seller”) and MARRIOTT VACATIONS WORLDWIDE OWNER
TRUST 2011-1, a Delaware statutory trust, as issuer (the “Issuer”), pursuant to
the Amended and Restated Sale Agreement referred to below.

WITNESSETH:

WHEREAS, the Seller and the Issuer are parties to that certain Amended and
Restated Sale Agreement dated as of September 1, 2012 (as such agreement may
have been, or may from time to time be, further amended, supplemented or
otherwise modified, the “Sale Agreement”);

WHEREAS, pursuant to the Sale Agreement, the Seller wishes to designate
Additional Timeshare Loans to be included on the Schedule of Timeshare Loans,
and the Seller wishes to sell its right, title and interest in and to the
Additional Timeshare Loans to the Issuer pursuant to this Supplement; and

WHEREAS, the Issuer wishes to purchase such Additional Timeshare Loans subject
to the terms and conditions hereof.

NOW, THEREFORE, the Seller and the Issuer hereby agree as follows:

1. Defined Terms. All capitalized terms used herein shall have the meanings
ascribed to them in the Sale Agreement unless otherwise defined herein.

“Cut-Off Date” shall mean, with respect to the Additional Timeshare Loans,
            .

“[Funding][Transfer] Date” shall mean, with respect to the Additional Timeshare
Loans,             .

“Additional Conveyed Timeshare Loan Assets” shall have the meaning set forth in
Section 3(a).

“Additional Timeshare Loans” shall mean the Additional Timeshare Loans that are
sold hereby and listed on Schedule 1 attached hereto.

2. Designation of Additional Timeshare Loans. The Seller delivers herewith
Schedule 1 containing a true and complete list of the Additional Timeshare
Loans. Such Schedule 1 is incorporated into and made part of this Supplement,
shall be Schedule 1 to this Supplement and shall supplement the Schedule of
Timeshare Loans.

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3. Sale of Additional Timeshare Loans.

The Seller does hereby sell, transfer, assign, set over and otherwise convey to
the Issuer, without recourse except as provided in Section 6 and Section 8 of
the Sale Agreement, all of the Seller’s right, title and interest in, to and
under (i) each Additional Timeshare Loan listed on the Schedule 1 hereto,
(ii) the Receivables in respect of such Timeshare Loans due on and after the
related Cut-Off Date, (iii) the related Timeshare Loan Files, (iv) all Related
Security in respect of each such Timeshare Loan, (v) all rights and remedies of
the Seller pursuant to the Purchase Agreement, and (vi) all income, payments,
proceeds and other benefits and rights related to any of the foregoing (the
“Additional Conveyed Timeshare Loan Assets”).

In connection with the foregoing sale and if necessary, the Seller agrees to
record and file one or more financing statements (and continuation statements or
other amendments with respect to such financing statements when applicable) with
respect to the Additional Conveyed Timeshare Loan Assets meeting the
requirements of applicable law in such manner and in such jurisdictions as are
necessary to perfect the sale of the Additional Conveyed Timeshare Loan Assets
to the Issuer, and to deliver a file-stamped copy of such financing statements
and continuation statements (or other amendments) or other evidence of such
filing to the Issuer.

In connection with the foregoing sale, the Seller further agrees, on or prior to
the date of this Supplement, to cause the portions of its computer files
relating to the Additional Timeshare Loans sold on such date to the Issuer to be
clearly and unambiguously marked to indicate that each such Additional Timeshare
Loan and the other Additional Conveyed Timeshare Assets have been sold on such
date to the Issuer pursuant to the Sale Agreement and this Supplement.

It is the express and specific intent of the parties that the transfer of the
Additional Timeshare Loans and the other Additional Conveyed Timeshare Assets
from the Seller to the Issuer as provided is and shall be construed for all
purposes as a true and absolute sale of such Additional Timeshare Loans and
Additional Conveyed Timeshare Assets, shall be absolute and irrevocable and
provide the Issuer with the full benefits of ownership of the Additional
Timeshare Loans and the other Additional Conveyed Timeshare Assets. In the
event, however, that a court of competent jurisdiction were to hold that any
such transfer constitutes a loan and not a sale, it is the intention of the
parties that the Seller shall be deemed to have Granted to the Issuer as of the
date of this Supplement, a first priority perfection security interest in all of
the Seller’s right, title and interest in, to and under each Timeshare Loan
whether now owned or hereafter acquired, and the related property described in
Section 2 of the Sale Agreement. The Seller acknowledges that the Issuer intends
to grant to the Indenture Trustee a security interest in the Additional Conveyed
Timeshare Assets and that the Additional Timeshare Loans and other Additional
Conveyed Timeshare Assets are subject to the Lien of the Indenture and Servicing
Agreement for the benefit of the Indenture Trustee on behalf of the Noteholders
and the Hedge Counterparty.

4. Acceptance by the Issuer. The Issuer hereby acknowledges that, prior to or
simultaneously with the execution and delivery of this Supplement, the Seller
delivered to the Issuer the Schedule described in Section 2 of this Supplement
with respect to all Additional Timeshare Loans.

--------------------------------------------------------------------------------

5. Representations and Warranties of the Seller. The Seller hereby represents
and warrants to the Issuer on the [Funding][Transfer] Date that each
representation and warranty to be made by it on such [Funding][Transfer] Date
pursuant to the Sale Agreement is true and correct, and that each such
representation and warranty is hereby incorporated herein by reference as though
fully set out in this Supplement.

6. Ratification of the Sale Agreement. The Sale Agreement is hereby ratified,
and all references to the Sale Agreement shall be deemed from and after the
[Funding][Transfer] Date to be references to the Sale Agreement as supplemented
and amended by this Supplement. Except as expressly amended hereby, all the
representations, warranties, terms, covenants and conditions of the Sale
Agreement shall remain unamended and shall continue to be, and shall remain, in
full force and effect in accordance with its terms and except as expressly
provided herein shall not constitute or be deemed to constitute a waiver of
compliance with or consent to non-compliance with any term or provision of the
Sale Agreement.

7. Counterparts. This Supplement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument.
Delivery of an executed counterpart of this Agreement by facsimile or other
electronic transmission (i.e., “pdf” or “tif”) shall be effective as delivery of
a manually executed counterpart hereof and deemed an original.

8. GOVERNING LAW. THIS SUPPLEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each of the parties hereto has caused this Assignment to be
duly executed by their respective officers as of the day and year first written
above.

 

MORI SPC SERIES CORP., as Seller

By:

 

 

  Name:     Title:     Address:  

6649 Westwood Boulevard

Orlando, Florida 32821

  Telephone:   (407) 206-6000   Facsimile:   (407) 206-6420 MARRIOTT VACATIONS
WORLDWIDE OWNER TRUST 2011-1

By:

  WILMINGTON TRUST, NATIONAL ASSOCIATION, not individually but solely in its
capacity as Owner Trustee

By:

 

 

  Name:   Dante M. Monakil   Title:   Vice President   Address:  

1220 North Market Street, Suite 202

Wilmington, Delaware 19801

  Telephone:   (302) 255-4970   Facsimile:   (302) 661-2266

--------------------------------------------------------------------------------

ANNEX A

Standard Definitions

--------------------------------------------------------------------------------

Final

(Second Amended and Restated)

September 11, 2012

Annex A

SECOND AMENDED AND RESTATED STANDARD DEFINITIONS

Rules of Construction. In these Second Amended and Restated Standard Definitions
and with respect to the Facility Documents (as defined below), (a) the meanings
of defined terms are equally applicable to the singular and plural forms of the
defined terms, (b) in any Facility Document, the words “hereof,” “herein,”
“hereunder” and similar words refer to such Facility Document as a whole and not
to any particular provisions of such Facility Document, (c) any subsection,
Section, Article, Annex, Schedule and Exhibit references in any Facility
Document are to such Facility Document unless otherwise specified, (d) the term
“documents” includes any and all documents, instruments, agreements,
certificates, indentures, notices and other writings, however evidenced
(including electronically), (e) the term “including” is not limiting and (except
to the extent specifically provided otherwise) shall mean “including (without
limitation)”, (f) unless otherwise specified, in the computation of periods of
time from a specified date to a later specified date, the word “from” shall mean
“from and including,” the words “to” and “until” each shall mean “to but
excluding,” and the word “through” shall mean “to and including”, and (g) the
words “may” and “might” and similar terms used with respect to the taking of an
action by any Person shall reflect that such action is optional and not required
to be taken by such Person.

“1940 Act” shall mean the Investment Company Act of 1940, as amended.

“Act” shall have the meaning specified in Section 1.04 of the Indenture and
Servicing Agreement.

“Acceleration Event” shall have the meaning specified in Section 6.06 of the
Indenture and Servicing Agreement.

“Accounting Based Consolidation Event” shall mean the consolidation, for
financial and/or regulatory accounting purposes, of all or any portion of the
assets and liabilities of any Conduit that are subject to the Note Purchase
Agreement or any other Facility Document with all or any portion of the assets
and liabilities of an Affected Entity. An Accounting Based Consolidation Event
shall be deemed to occur on the date any Affected Entity shall acknowledge in
writing that any such consolidation of the assets and liabilities of the related
Conduit shall occur.

“Acquiring Alternate Purchaser” shall have the meaning set forth in
Section 5.10(d) of the Note Purchase Agreement.

“Acquiring Non-Conduit Committed Purchaser” shall have the meaning set forth in
Section 5.10(f) of the Note Purchase Agreement.

“Acquiring Purchaser” shall mean an Acquiring Purchaser Group or an Acquiring
Non-Conduit Committed Purchaser.

--------------------------------------------------------------------------------

“Acquiring Purchaser Group” shall have the meaning set forth in Section 5.10(f)
of the Note Purchase Agreement.

“Additional Conduit” shall have the meaning set forth in Section 2.3(d) of the
Note Purchase Agreement.

“Additional Funding Agent” shall have the meaning set forth in Section 2.3(d) of
the Note Purchase Agreement.

“Additional Non-Conduit Committed Purchaser” shall have the meaning set forth in
Section 2.3(d) of the Note Purchase Agreement.

“Additional Purchaser” shall mean an Additional Conduit and the Related
Additional Alternate Purchasers or an Additional Non-Conduit Committed
Purchaser.

“Additional Timeshare Loans” shall mean any Timeshare Loans (including Qualified
Substitute Timeshare Loans) conveyed by MORI to the Seller and by the Seller to
the Issuer and pledged by the Issuer to the Indenture Trustee on a Funding Date
or Transfer Date, as applicable.

“Additional Timeshare Loan Supplement” shall mean, with respect to any
Additional Timeshare Loans, an Additional Timeshare Loan Supplement,
substantially in the form of Exhibit D to the Purchase Agreement or Sale
Agreement, as applicable.

“Adjusted Commitment” shall mean on any date of determination with respect to an
Alternate Purchaser for a Conduit, such Alternate Purchaser’s Commitment minus
the sum of (a) the portion of the Purchaser Invested Amount with respect to the
Purchaser Group of which such Conduit is a member funded by such Alternate
Purchaser and (b) the portion of such Purchaser Invested Amount an interest in
which was acquired by such Alternate Purchaser acting as a Liquidity Provider
pursuant to a Liquidity Agreement.

“Adjusted LIBOR Rate” shall mean, with respect to any Funding Period, the sum of
(A) the Applicable Percentage and (B) a rate per annum equal to the rate
(rounded upwards, if necessary, to the next higher 1/100 of 1%) obtained by
dividing (i) the LIBOR Rate for such Funding Period by (ii) a percentage equal
to 100% minus the reserve percentage (rounded upward to the next 1/100th of 1%)
in effect on such day and applicable to the Alternate Purchaser or related
Liquidity Provider for which this rate is calculated under regulations issued
from time to time by the Board of Governors of the Federal Reserve System for
determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) with respect to Eurocurrency
funding (currently referred to as “eurocurrency liabilities”). The Adjusted
LIBOR Rate shall be adjusted automatically as of the effective date of any
change in such reserve percentage.

“Administration Agreement” shall mean that certain administration agreement,
dated as of September 1, 2011, by and among the Issuer, the Indenture Trustee,
the Owner Trustee and the Administrator.

 

- 2 -

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“Administrative Agent” shall mean Deutsche Bank AG, New York Branch, in its
capacity as Administrative Agent for the Purchasers and the Funding Agents, and
any successor Administrative Agent appointed pursuant to the terms of the Note
Purchase Agreement.

“Administrative Agent-Related Persons” shall mean the Administrative Agent,
together with its Affiliates, and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and their respective Affiliates.

“Administrative Agent Fee” shall have the meaning set forth in the related Fee
Letter; provided that the Administrative Agent Fee shall not be greater than
0.10% of the Facility Limit per annum.

“Administrator” shall mean Marriott Ownership Resorts, Inc., a Delaware
corporation.

“Administrator Fee” shall equal $1,000 paid annually in accordance with
Section 3.04 of the Indenture and Servicing Agreement.

“Advance Rate” shall mean, with respect to the Borrowing Base Loans related to a
Borrowing Base Loan Group, the applicable Advance Rate specified in the chart
below:

 

Borrowing Base Loan Group

   Applicable
Advance Rate  

FICO 600 to 649 Loan Group

     50 % 

FICO 650 to 699 Loan Group

     76 % 

FICO 700 to 749 Loan Group

     91 % 

FICO 750 Plus Loan Group

     96 % 

Foreign Timeshare Loan Group I

     68 % 

Foreign Timeshare Loan Group II

     40 % 

“Adverse Claim” shall mean any claim of ownership or any lien, security
interest, title retention, trust or other charge or encumbrance, or other type
of preferential arrangement having the effect or purpose of creating a lien or
security interest, other than the interests created under the Indenture and
Servicing Agreement in favor of the Indenture Trustee and the Noteholders.

“Affected Entity” shall mean (i) any Alternate Purchaser, (ii) any Liquidity
Provider, (iii) any agent, administrator or manager of any Conduit, or (iv) any
bank holding company in respect of any of the foregoing.

“Affiliate” shall mean with respect to any Person, a Person: (a) which directly
or indirectly controls, or is controlled by, or is under common control with
such Person; (b) which directly or indirectly beneficially owns or holds five
percent (5%) or more of the voting stock of

 

- 3 -

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such Person; or (c) for which five percent (5%) or more of the voting stock of
which is directly or indirectly beneficially owned or held by such Person. The
term “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise.
Without limiting the generality of the foregoing, for purposes of the definition
of “Outstanding,” MVCO Series LLC, MORI, MVC Trust, MVCI Finance, C.V., The
Ritz-Carlton Development Company, Inc., Marriott Ownership Resorts (St. Thomas),
Inc., Marriott Vacation Worldwide Corporation and their Affiliates shall be
deemed an Affiliate of the Issuer.

“Aggregate Loan Balance” shall mean the sum of the Loan Balances for all
Borrowing Base Loans.

“Alternate Purchasers” shall mean, with respect to a Conduit, each Purchaser
identified as an Alternate Purchaser for such Conduit on Schedule I to the Note
Purchase Agreement or in the Assignment and Assumption Agreement pursuant to
which such Conduit became a party to the Note Purchase Agreement, and any
permitted assignee thereof.

“Alternate Purchaser Assignment and Assumption Agreement” shall mean an
Assignment and Assumption Agreement substantially in the form of Exhibit A to
the Note Purchase Agreement.

“Alternate Purchaser Percentage” shall mean, with respect to any Alternate
Purchaser for a Conduit, such Alternate Purchaser’s Commitment with respect to
such Conduit as a percentage of the Purchaser Commitment Amount with respect to
the Purchaser Group of which such Conduit is a member.

“Amendment Effective Date” shall mean September 11, 2012, so long as the
conditions precedent set forth in Section 13.09 of the Indenture and Servicing
Agreement and Section 3.8 of the Note Purchase Agreement have been satisfied on
or prior to such date.

“Amortization Event” shall exist on and after a Determination Date if any of the
following shall have occurred:

(a) the Warehouse Portfolio Three Month Rolling Average Delinquency Percentage
is greater than 5.50%; or

(b) the Securitized Portfolio Three Month Rolling Average Delinquency Percentage
is greater than 5.50%; or

(c) the Warehouse Portfolio Three Month Rolling Average Default Percentage is
greater than 0.75%; or

(d) the Securitized Portfolio Three Month Rolling Average Default Percentage is
greater than 0.75%; or

(e) to the extent the Aggregate Loan Balance is more than $0, the Gross Excess
Spread Percentage for the related Due Period is less than 5.00%; or

 

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(f) an Event of Default occurs; or

(g) a Servicer Event of Default occurs; or

(h) the amount on deposit in the Reserve Account is less than the Reserve
Account Required Balance for any three consecutive Business Days; or

(i) the MVC Trust shall incur any indebtedness (other than trade debt in the
ordinary course).

Upon the first occurrence of an Amortization Event of a type described in any of
clauses (a), (b), (c), (d) or (e) above, such Amortization Event shall continue
until the Determination Date on which the Warehouse Portfolio Three Month
Rolling Average Delinquency Percentage, Securitized Portfolio Three Month
Rolling Average Delinquency Percentage, Warehouse Portfolio Three Month Rolling
Average Default Percentage, Securitized Portfolio Three Month Rolling Average
Default Percentage or Gross Excess Spread Percentage, as the case may be, is
equal to or less than (in the case of clauses (a), (b), (c) or (d)) or equal to
or greater than (in the case of clause (e)), the specified threshold. Upon the
second occurrence of an Amortization Event of a type described in any of clauses
(a), (b), (c), (d) or (e) above, an Amortization Event shall exist and continue
until the Outstanding Note Balance has been reduced to zero.

An Amortization Event of the type described in clauses (f), (g), (h) or
(i) shall continue until the Outstanding Note Balance of the Notes has been
reduced to zero.

“Anticipated Completion Date” shall mean, for a Pre-Completion Loan, the date
set forth in the related Additional Timeshare Loan Supplement as specified by
resort and building on which the related Unit is expected to be an Available
Unit.

“Applicable Percentage” shall mean 1.50%.

“Assignment and Assumption Agreement” shall mean any Alternate Purchaser
Assignment and Assumption Agreement or any Purchaser Assignment and Assumption
Agreement.

“Assumption Date” shall have the meaning specified in Section 5.19(f) of the
Indenture and Servicing Agreement.

“Authorized Officer” shall mean (a) with respect to any corporation, limited
liability company or partnership, the Chairman of the Board, the President, any
Vice President, the Secretary, the Treasurer, any Assistant Secretary, any
Assistant Treasurer, Managing Member and each other officer of such corporation
or limited liability company or the general partner of such partnership
customarily performing functions similar to those performed by any of the above
designated officers, and with respect to a particular matter, any other officer
to whom such matter is referred because of such officer’s knowledge and
familiarity with the particular subject or such officer specifically authorized
in resolutions of the Board of Directors of such corporation or managing member
of such limited liability company to sign agreements, instruments or other
documents in connection with the Indenture and Servicing Agreement on behalf of
such corporation, limited liability company or partnership, as the case may be
or (b) with respect to a trust, any person meeting the criteria specified in
clause (a) above with respect to the related trustee.

 

- 5 -

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“Available Funds” shall mean for any Payment Date, (A) all funds on deposit in
the Collection Account after making all transfers and deposits required from or
by (i) the Servicer pursuant to the Indenture and Servicing Agreement, (ii) the
Reserve Account pursuant to Section 3.02(b) of the Indenture and Servicing
Agreement, (iii) the Seller or the Issuer pursuant to Section 4.06 of the
Indenture and Servicing Agreement, (iv) the Performance Guarantor pursuant to
the Performance Guaranty, and (v) a Hedge Counterparty in respect of a Hedge
Agreement, less (B) amounts on deposit in the Collection Account related to
collections related to any Due Periods subsequent to the Due Period related to
such Payment Date.

“Available Unit” shall mean a Unit where the Unit’s construction has been
completed in accordance with applicable brand standards and becomes available
for occupancy by timeshare owners.

“Back-Up Servicer” shall mean Wells Fargo Bank, National Association and its
permitted successors and assigns, as provided in the Indenture and Servicing
Agreement.

“Back-Up Servicing Fee” shall mean for any Payment Date, an amount equal to the
greater of (a) $2,500 and (b) the product of (x) one-twelfth of 0.02% and
(y) the Aggregate Loan Balance as of the first day of the related Due Period.

“Bank Base Rate” shall mean, with respect to any Purchaser for any day, a rate
per annum equal to the sum of (i) the Base Rate with respect to such Purchaser
on such date and (ii) the Applicable Percentage.

“Base Rate” shall mean, with respect to any Purchaser for any day, a rate per
annum equal to the greatest of (i) the prime rate of interest announced publicly
by (x) if such Purchaser is a Non-Conduit Committed Purchaser, such Purchaser
(or the Affiliate of such Purchaser that announces such rate), and (y) if such
Purchaser is a member of a Purchaser Group, the Funding Agent with respect to
such Purchaser Group (or the Affiliate of such Purchaser or Funding Agent, as
applicable, that announces such rate) as in effect at its principal office from
time to time, changing when and as said prime rate changes (such rate not
necessarily being the lowest or best rate charged by such Person), (ii) the sum
of (a) 0.50% and (b) the rate equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day for such transactions
received by such Purchaser (or if such Purchaser is a member of a Purchaser
Group, the Funding Agent with respect to such Purchaser Group) from three
Federal funds brokers of recognized standing selected by it and (iii) the sum of
(x) 1.00% and (b) the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01 Page (or any successor
page or such other page or service as such Purchaser shall determine in its sole
discretion) as the London interbank offered rate for deposits in U.S. dollars at
approximately 11:00 A.M. (London time) on such date (or if

 

- 6 -

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such day is not a London Business Day, on the next preceding London Business
Day) for a term of one month, or, if more than one rate is specified on the
applicable page or screen, the arithmetic mean of all such rates.
Notwithstanding any of the foregoing to the contrary, solely for the purposes of
Sections 2.8(c) and 2.8(d) of the Note Purchase Agreement, “Base Rate” shall
mean the greater of the rates described in clause (i) and clause (ii) of the
preceding sentence.

“Bankruptcy Code” shall mean the federal Bankruptcy Code, as amended (Title 11
of the United States Code).

“Beneficial Interest” shall mean the beneficial interests in the MVC Trust owned
by an Obligor.

“Benefit Plan” shall mean an “employee benefit plan” as defined in Section 3(3)
of ERISA that is subject to Title I of ERISA or any other “plan” as defined in
Section 4975(e)(1) of the Code that is subject to Section 4975 of the Code or
any entity whose underlying assets include plan assets by reason of an employee
benefit plan’s or plan’s investment in such entity or any plan that is subject
to any substantially similar provision of federal, state or local law.

“Borrowing Base” means for any date of determination, the lesser of:

(x) the sum of the products of (i) the aggregate Loan Balance of each Borrowing
Base Loan Group minus its related Excluded Loan Group Balance and (ii) the
applicable Advance Rate; and

(y) the sum of the products of (i) the aggregate Loan Balance of each Borrowing
Base Loan Group minus its related Excluded Loan Group Balance and (ii) 85%.

For purposes of calculating the Borrowing Base on a Funding Date, the aggregate
Loan Balance of a Borrowing Base Loan Group, the Aggregate Loan Balance and
Excluded Loan Balance shall be measured as of the last day of the Due Period
related to the immediately preceding Payment Date (or, with respect to the
Additional Timeshare Loans conveyed on such Funding Date or Timeshare Loans
conveyed during the same Due Period, the related Cut-off Date). For purposes of
calculating the Borrowing Base with respect to any Determination Date, the
aggregate Loan Balance of a Borrowing Base Loan Group, the Aggregate Loan
Balance and Excluded Loan Balance shall be measured as of the end of the related
Due Period (or, with respect to the Additional Timeshare Loans conveyed on such
Funding Date or Timeshare Loans conveyed during the same Due Period, the related
Cut-off Date). All Defaulted Timeshare Loans, Delinquent Timeshare Loans and
Defective Timeshare Loans shall be deemed to have a Loan Balance of zero ($0)
for purposes of this definition.

“Borrowing Base Loan Group” means any of the Foreign Timeshare Loan Group I,
Foreign Timeshare Loan Group II, FICO 600 to 649 Loan Group, FICO 650 to 699
Loan Group, FICO 700 to 749 Loan Group and FICO 750 Plus Loan Group.

“Borrowing Base Loans” shall mean, as of any date of determination, all
Timeshare Loans that are Eligible Timeshare Loans on such date and owned
directly by the Issuer and pledged to the Indenture Trustee pursuant to the
Indenture and Servicing Agreement or a Supplemental Grant.

 

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“Borrowing Base Shortfall” means on as of any date of determination, the amount,
if any, by which the Outstanding Note Balance (without giving effect to any
Increase on such date) exceeds the Borrowing Base on such date (without giving
effect to any pledge of Additional Timeshare Loans to the Indenture Trustee on
such date).

“Borrowing Notice” shall mean the notice presented by the Issuer to the
Administrative Agent, each Funding Agent, each Non-Conduit Committed Purchaser,
the Servicer and the Indenture Trustee to request the initial advance on the
Initial Funding Date or thereafter, an Increase, in the form attached as Exhibit
D to the Note Purchase Agreement.

“Breakage and Other Costs” shall mean any and all amounts owing by the Issuer to
any Purchaser or Funding Agent or the Administrative Agent pursuant to this
Agreement or any other Facility Document, other than in respect of interest or
principal on any Note and shall include without limitation (i) the amount of all
fees due under the Renewal Fee Letter (other than Purchaser Fees and the
Up-Front Renewal Fees), (ii) the amount of any Early Collection Fee and
(iii) any other amounts due from the Issuer hereunder but not included in
interest or principal on the Notes including, without limitation, under Sections
4.1, 4.2, 4.3 and 4.4 of the Note Purchase Agreement.

“Business Day” shall mean any day other than (i) a Saturday or a Sunday, or
(ii) a day on which banking institutions in New York City, the city in which the
Servicer is located or the city in which the Corporate Trust Office is located,
are authorized or obligated by law or executive order to be closed.

“Carrying Costs” shall mean, with respect to any Interest Accrual Period the sum
(without duplication) of the following amounts determined on an accrual basis in
accordance with GAAP consistently applied: with respect to (x) any Purchaser
Group, (a) the amount of interest accrued with respect to the portion of the
Purchaser Invested Amount funded by the Conduit which is a member of such
Purchaser Group at a rate equal to the CP Rate applicable to such Conduit for
such Interest Accrual Period and (b) the amount of interest accrued with respect
to the portion of the Purchaser Invested Amount funded by any Alternate
Purchaser which is a member of such Purchaser Group or any Liquidity Provider
with respect to such Conduit at either the Adjusted LIBOR Rate or the Bank Base
Rate, as applicable in accordance with Section 2.8(a) of the Note Purchase
Agreement and (y) any Non-Conduit Committed Purchaser, the amount of interest
accrued with respect to its Purchaser Invested Amount at the LIBOR Rate or the
LIBOR Rate plus the Applicable Percentage, as applicable, in accordance with
Section 2.8(a) of the Note Purchase Agreement; provided, however, that following
the occurrence of an Event of Default, the Carrying Costs with respect to any
Purchaser Group or Non-Conduit Committed Purchaser shall be determined in
accordance with Section 2.8(b) of the Note Purchase Agreement. The Carrying
Costs for any Interest Accrual Period determined by reference to the applicable
CP Rate or daily LIBOR Rate shall be calculated using an estimate for the days
in such Interest Accrual Period remaining after the date on which the applicable
Funding Agent or Non-Conduit Committed Purchaser notifies the Administrative
Agent of the applicable Carrying

 

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Costs pursuant to Section 2.8(a)(v) of the Note Purchase Agreement. On or before
the day on which the applicable Funding Agent or Non-Conduit Committed Purchaser
is required to notify the Administrative Agent of the applicable Carrying Costs
with respect to the next succeeding Accrual Period, such Funding Agent or
Non-Conduit Committed Purchaser shall re-determine the Carrying Costs in respect
of the prior Accrual Period and if such re-determined amount is higher or lower
than the Carrying Costs initially reported as described above, such Funding
Agent or Non-Conduit Committed Purchaser shall advise the Administrative Agent
of the re-determined Carrying Costs, specifying the amount of any Carrying Costs
Underpayment or any Carrying Costs Overpayment.

“Carrying Costs Overpayment” shall mean, with respect to any Accrual Period
(x) with respect to a Purchaser Group the excess, if any, of (i) the amount of
Carrying Costs for such Accrual Period determined based on the CP Rate as
initially determined by the applicable Funding Agent pursuant to the definition
of “Carrying Costs”, over (ii) the amount of Carrying Costs for such Accrual
Period determined based on the CP Rate as re-determined by such Funding Agent
prior to the next succeeding Payment Date pursuant to the definition of
“Carrying Costs” and (y) with respect to a Non-Conduit Committed Purchaser, the
excess, if any, of (i) the amount of Carrying Costs for such Accrual Period
determined based on the LIBOR Rate as initially determined by such Non-Conduit
Committed Purchaser pursuant to the definition of “Carrying Costs”, over
(ii) the amount of Carrying Costs for such Accrual Period determined based on
the LIBOR Rate as re-determined by such Non-Conduit Committed Purchaser prior to
the next succeeding Payment Date pursuant to the definition of “Carrying Costs”.

“Carrying Costs Underpayment” shall mean, with respect to any Accrual Period
(x) with respect to a Purchaser Group, the excess, if any, of (i) the amount of
Carrying Costs for such Accrual Period determined based on the CP Rate as
re-determined by the applicable Funding Agent prior to the next succeeding
Payment Date pursuant to the definition of “Carrying Costs”, over (ii) the
amount of Carrying Costs for such Accrual Period determined based on the CP Rate
as initially determined by such Funding Agent pursuant to the definition of
“Carrying Costs” and (y) with respect to a Non-Conduit Committed Purchaser, the
excess, if any, of (i) the amount of Carrying Costs for such Accrual Period
determined based on the LIBOR Rate as re-determined by such Non-Conduit
Committed Purchaser prior to the next succeeding Payment Date pursuant to the
definition of “Carrying Costs”, over (ii) the amount of Carrying Costs for such
Accrual Period determined based on the LIBOR Rate as initially determined by
such Non-Conduit Committed Purchaser pursuant to the definition of “Carrying
Costs”.

“Certificate of Trust” shall mean the Certificate of Trust filed with the
Secretary of State for the State of Delaware on September 6, 2011 in order to
form the Issuer, as the same may be amended, supplemented or otherwise modified
in accordance with the terms thereof.

“Change of Control” means (i) any “person” or “group” (as such terms are used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) ) shall become, or obtain rights (whether by means or warrants,
options or otherwise) to become, the “beneficial owner” (as defined in Rules
13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more
than 30% of the outstanding common stock of the Performance Guarantor, (ii) the
board of directors of the Performance Guarantor shall cease to

 

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consist of a majority of Continuing Directors; or (iii) the Performance
Guarantor, through its subsidiary MVW US Holdings, Inc., shall cease to own and
control, of record and beneficially, directly 100% of each class of outstanding
Capital Stock of MORI, the Seller and the Owner, free and clear of all Liens
(except Liens created hereunder or under the Corporate Revolver Facility.

“Closing Date” shall mean September 28, 2011.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time and any successor statute, together with the rules and regulations
thereunder.

“Collection Account” shall mean the account established and maintained by the
Indenture Trustee pursuant to Section 3.02(a) of the Indenture and Servicing
Agreement.

“Commercial Paper” shall mean either (i) the promissory notes of any Conduit
issued by such Conduit in the commercial paper market or (ii) the promissory
notes issued in the commercial paper market by a multi-seller commercial paper
conduit the proceeds of which are loaned to a Conduit.

“Commitment” shall mean, for each Committed Purchaser, on any date of
determination, the commitment of such Committed Purchaser to purchase a Note on
the Initial Funding Date and, thereafter, to maintain and, subject to certain
conditions, increase its investment therein in accordance with the terms of the
Note Purchase Agreement in an amount not to exceed (a) (i) in the case of any
Committed Purchaser which is a party hereto on the Amendment Effective Date, the
dollar amount set forth opposite the name of such Committed Purchaser on
Schedule I of the Note Purchase Agreement, (ii) in the case of any Committed
Purchaser which is not a party hereto on the Amendment Effective Date, the
dollar amount specified as such in the Purchaser Assignment and Assumption
Agreement for such Purchaser or (iii) in the case of any permitted assignee of
an Alternate Purchaser pursuant to Section 5.10(d) of the Note Purchase
Agreement, the amount specified as such in the Alternate Purchaser Assignment
and Assumption Agreement pursuant to which such assignee acquired its interest
in the Notes, minus (b) the dollar amount of any portion thereof assigned
pursuant to an Assignment and Assumption Agreement in accordance with
Section 5.10 of the Note Purchase Agreement prior to such date of determination,
plus (c) the dollar amount of any increase to such Committed Purchaser’s
Commitment consented to by such Committed Purchaser prior to such date of
determination.

“Commitment Percentage” shall mean, on any date of determination, with respect
to any Non-Conduit Committed Purchaser or Purchaser Group, the ratio, expressed
as a percentage, which the Purchaser Commitment Amount of such Non-Conduit
Committed Purchaser or Purchaser Group bears to the Facility Limit on such date.

“Committed Purchaser” shall mean any Alternate Purchaser or any Non-Conduit
Committed Purchaser.

 

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“Competes” shall mean (1) to compete, conduct or participate or engage in, or
bid for or otherwise pursue a business, whether as a principal, sole proprietor,
partner, stockholder, or agent of, or consultant to or manager for, any Person
or in any other capacity; or (2) have any debt or equity ownership interest in
or actively assist, any Person or business that conducts, participates or
engages in, or bids for or otherwise pursues a business, whether as a principal,
sole proprietor, partner or stockholder, or agent of, or consultant to or
manager for, any Person or in any other capacity; provided, that “Competes”
shall not include ownership of less than 5% of the outstanding equity securities
of a publicly-traded Person; provided, further, that “Competes” shall not
include acting as a lender (including a Purchaser under the Facility Documents)
to a Direct Competitor or acting in an advisory role to a Direct Competitor.

“Conduit” shall mean any commercial paper conduit identified as a Conduit on
Schedule I to the Note Purchase Agreement or in the Assignment and Assumption
Agreement pursuant to which such Purchaser became a party thereto, and any
permitted assignee thereof.

“Conduit Assignee” shall mean, with respect to any Conduit, either (x) any
commercial paper conduit administered by the Funding Agent with respect to such
Conduit or (y) any other commercial paper conduit which has entered into a
Liquidity Agreement with one or more Alternate Purchasers (or any Affiliate of
such Alternate Purchasers) with respect to such Conduit, in either case
designated by the Funding Agent with respect to such Conduit to accept an
assignment from such Conduit of the Purchaser Invested Amount or a portion
thereof with respect to the Purchaser Group of which such Conduit is a member
and such Conduit’s rights and obligations under this Agreement pursuant to
Section 5.10(c) of the Note Purchase Agreement; provided that no Conduit
Assignee pursuant to clause (y) of this definition shall be a direct competitor
(or an Affiliate thereof) of the Performance Guarantor or the Servicer in the
lodging, vacation exchange and rentals or vacation ownership businesses.

“Consolidated Net Worth” shall mean at any date, all amounts that would, in
conformity with GAAP, be included on a consolidated balance sheet of MVW under
stockholders’ equity at such date.

“Consolidated Tangible Net Worth” shall mean, at any date, (a) Consolidated Net
Worth, minus (b) the net book value of all assets on the consolidated balance
sheet of MVWC used to calculate Consolidated Net Worth that would be treated as
intangible assets under GAAP (including goodwill, trademarks, trade names,
service marks, service names, copyrights, patents, organizational expenses and
the excess of any equity in any Subsidiary over the cost of the investment in
such Subsidiary), all as determined on a consolidated basis in accordance with
GAAP

“Continued Errors” shall have the meaning specified in Section 5.19(f)(i) of the
Indenture and Servicing Agreement.

“Continuing Directors” shall mean the directors of the Performance Guarantor on
the Amendment Effective Date and each other director, if, in each case, such
other director’s nomination for election to the board of directors of such
Performance Guarantor is recommended by at least 66-2/3% of the then Continuing
Directors.

 

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“Control Account” shall mean any account subject to a Control Agreement. A list
of all Control Accounts on the Amendment Effective Date has been provided by the
Issuer (or its agent) to the Administrative Agent and the Indenture Trustee.

“Control Account Bank” shall mean a commercial bank at which a Control Account
is established. A list of all Control Account Banks on the Amendment Effective
Date has been provided by the Issuer (or its agent) to the Administrative Agent
and the Indenture Trustee.

“Control Agreement” shall mean a control agreement by and among the Issuer (or
its agent), the Indenture Trustee (or its agent), the Servicer and the related
Control Account Bank, which agreement sets forth the rights of the parties
thereto with respect to the disposition and application of collections deposited
in the related Control Account, including the right of the Indenture Trustee (or
its agent) to direct the Control Account Bank to remit collections directly to
the Indenture Trustee for the benefit of the Noteholders.

“Control Account Intercreditor Agreement” means that certain intercreditor,
security and agency agreement, dated as of September 1, 2011, by and among the
Issuer, the Indenture Trustee, MVW, MORI, the Servicer, the various issuers and
indenture trustees and other creditors party thereto from time to time, and
Wells Fargo Bank, National Association, as agent.

“Conveyed Timeshare Loan Assets” shall have the meaning set forth in Section 2
of the Purchase Agreement and Sale Agreement.

“Corporate Revolver Facility” means that certain credit agreement, dated as of
October 20, 2011, among MVW, MORI, as borrower, the several lenders from time to
time parties thereto, Bank of America, N.A. and Deutsche Bank Securities Inc.,
as co-documentation agents and JPMorgan Chase Bank, N.A., as administrative
agent, as amended.

“Corporate Trust Office” shall mean (i) the office of the Indenture Trustee,
which office is at the address set forth in Section 13.03 of the Indenture and
Servicing Agreement, or (ii) the office of the Owner Trustee, which is at the
address set forth in Section 2.2 of the Trust Agreement, as applicable.

“CP Rate” shall mean, with respect to (a) a Conduit that is funding a portion of
the Purchaser Invested Amount with respect to the Purchaser Group of which it is
a member on a pooled basis, for each day, the weighted average rate at which
interest or discount is accruing on or in respect of the Commercial Paper with
respect to such Conduit allocated, in whole or in part, by the related Funding
Agent, to fund the purchase or maintenance of such portion of such Purchaser
Invested Amount (including, without limitation, any interest attributable to the
commissions of placement agents and dealers in respect of such Commercial Paper
and any costs associated with funding small or odd-lot amounts, to the extent
that such commissions or costs are allocated, in whole or in part, to such
Commercial Paper by such Funding Agent) or (b) a Conduit that is funding a
portion of the Purchaser Invested Amount with respect to the Purchaser Group of
which it is a member with Commercial Paper with respect to such Conduit issued
in specified tranches (such Conduit, a “Match Funded Conduit”), the weighted
average rate of the

 

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Commercial Paper with respect to such Conduit issued to fund or maintain such
portion of such Purchaser Invested Amount, including an amount equal to the
portion of the Face Amount of the outstanding Commercial Paper issued to fund or
maintain such portion of such Purchaser Invested Amount that corresponds to the
portion of the proceeds of such Commercial Paper that was used to pay the
interest or discount component of maturing Commercial Paper issued to fund or
maintain such portion of such Purchaser Invested Amount, to the extent that such
Conduit has not received payments of interest in respect of such interest
component prior to the maturity date of such maturing Commercial Paper, and
including the portion of such interest or discount component constituting dealer
or placement agent commissions; provided, however, that each such Match Funded
Conduit shall approve the length of each tranche period and the portion of such
Purchaser Invested Amount allocated to such tranche period.

“CRD” shall mean the European Union Directive 2006/48/EC, as amended from time
to time.

“CRD MVW Entity” means each of the Owner, MORI and the Seller.

“Credit and Collection Policy” shall mean those credit and collection policies
and practices of the initial Servicer in effect as of a specified date; and for
any successor Servicer shall mean the credit and collection policies and
practices of such successor in effect on the date which it commences servicing.
The Credit and Collection Policy of the initial Servicer in effect on the
Closing Date and the Amendment Effective Date has been delivered to the
Administrative Agent and the Indenture Trustee.

“Credit Card Account” shall mean an arrangement whereby an Obligor makes
payments under a Timeshare Loan via pre-authorized debit to a Major Credit Card.

“Current Equity Percentage” shall mean, with respect to any date of
determination and a Timeshare Loan (a) 100% minus (B) the ratio expressed as a
percentage of (i) the related Loan Balance minus financed closing costs divided
by (ii) the related Purchase Price.

“Custodial Agreement” shall mean that certain custodial agreement, dated as of
September 1, 2011, by and among, the Custodian, the Indenture Trustee, the
Servicer and the Issuer.

“Custodial Fees” shall mean such fees as the Custodian shall charge from time to
time, as specified in the Custodial Agreement.

“Custodian” shall mean Wells Fargo Bank, National Association or its permitted
successors and assigns.

“Cut-Off Date” shall mean the date specified in the related Schedule of
Timeshare Loans as the date after which all subsequent collections related to
such Timeshare Loans are sold by MORI to the Seller and by the Seller to the
Issuer and pledged by the Issuer to the Indenture Trustee.

 

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“Cut-Off Date Loan Balance” shall mean the Loan Balance of a Timeshare Loan on
the related Cut-Off Date.

“DBRS” shall mean DBRS, Inc.

“Defaulted Timeshare Loan” is any Timeshare Loan for which any of the earliest
following events may have occurred: (i) any payment or part thereof has been
delinquent more than 150 days as of the end of the related Due Period (as
determined by the Servicer in accordance with the Servicing Standard), (ii) the
Servicer has initiated foreclosure or similar proceedings with respect to the
related Timeshare Property or has received the related deed or assignment in
lieu of foreclosure, or (iii) provided that such Timeshare Loan is at least one
day delinquent, the Servicer has determined that such Timeshare Loan should be
fully written off in accordance with the Credit and Collection Policy.

“Defective Timeshare Loan” shall have the meaning specified in Section 4.06 of
the Indenture and Servicing Agreement.

“Deficit” shall have the meaning specified in Section 2.4 of the Note Purchase
Agreement.

“Delinquent Timeshare Loan” is a Timeshare Loan for which any payment or part
thereof has been delinquent more than 30 days as of the end of the related Due
Period.

“Determination Date” shall mean, with respect to any Payment Date, the second
Business Day prior to such Payment Date.

“Direct Competitor” means any Person that Competes with MVW, MORI or any
Vacation Ownership Business or any Subsidiary of such Person or other Person
that controls, is controlled by, or is under common control with, any of the
foregoing Persons. For purposes of this definition, “control” of a Person means
the power, directly or indirectly, to direct or to cause the direction of the
management and policies of such Person, whether by contract or otherwise.

“Domestic Obligor” shall mean Obligors who are citizens or residents of, and
make payments from, the United States, Puerto Rico, the U.S. Virgin Islands, or
Guam, any of the other territories of the United States, Canada or U.S. military
bases. For the avoidance of doubt, having a military address outside the United
States or making payments from such address shall not cause a United States
citizen or resident Obligor to not be a Domestic Obligor.

“Downpayment Percentage” shall mean, with respect to any date of determination
and a Timeshare Loan (a) 100% minus (b) the ratio expressed as a percentage of
(i) the original Loan Balance of such Timeshare Loan minus financed closing
costs divided by (ii) the related Purchase Price.

“Due Period” shall mean with respect to (i) any Payment Date other than the
initial Payment Date, the immediately preceding calendar month and (ii) the
initial Payment Date, the period from the Closing Date to and including the last
day of the calendar month prior to such Payment Date.

 

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“Early Collection Fee” shall mean, (i) with respect to any Purchaser Group and
any Funding Period during which the portion of the Outstanding Note Balance that
was allocated to such Funding Period is reduced for any reason whatsoever, the
excess, if any, of (x) the additional Carrying Costs that would have accrued
during such Funding Period if such reductions had not occurred, minus (y) the
income, if any, received by the recipient of such reductions from investing the
proceeds of such reductions and (ii) with respect to any Non-Conduit Committed
Purchaser and any Interest Accrual Period during which the Purchaser Invested
Amount of such Non-Conduit Committed Purchaser is reduced for any reason
whatsoever on a date other than a Payment Date, the excess, if any, of (x) the
additional Carrying Costs that would have accrued during such Interest Accrual
Period if such reductions had not occurred, minus (y) the income, if any,
received by the recipient of such reductions from investing the proceeds of such
reductions.

“Effective Date” shall mean, with respect to any Purchaser which becomes a party
to the Note Purchase Agreement after the Closing Date, the date on which such
Purchaser becomes a party hereto, whether by assignment or direct execution of
the Note Purchase Agreement or otherwise.

“Eligible Bank Account” shall mean a segregated account, which may be an account
maintained with the Indenture Trustee, which is either (a) maintained with a
depository institution or trust company whose long-term unsecured debt
obligations are rated at least A by S&P and A2 by Moody’s and whose short-term
unsecured obligations are rated at least A-1 by S&P and P-1 by Moody’s; or (b) a
trust account or similar account maintained at the corporate trust department of
the Indenture Trustee.

“Eligible Investments” shall mean one or more of the following obligations or
securities:

(1) direct obligations of, and obligations fully guaranteed as to timely payment
of principal and interest by, the United States of America or any agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America (“Direct
Obligations”);

(2) federal funds, or demand and time deposits in, certificates of deposit of,
or bankers’ acceptances issued by, any depository institution or trust company
(including U.S. subsidiaries of foreign depositories and the Indenture Trustee
or any agent of the Indenture Trustee, acting in its respective commercial
capacity) incorporated under the laws of the United States of America or any
state thereof and subject to supervision and examination by federal or state
banking authorities, so long as at the time of investment, the commercial paper
or other short-term unsecured debt obligations or long-term unsecured debt
obligations of such depository institution or trust company have been rated by
each Rating Agency in its highest short-term rating category or one of its two
highest long-term rating categories (and no such rating shall include a
subscript of “f”, “r”, “p”, “pi”, “q” or “t”);

 

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(3) securities bearing interest or sold at a discount issued by any corporation
incorporated under the laws of the United States of America or any state thereof
which has a short-term unsecured debt rating from each Rating Agency, at the
time of investment at least equal to the highest short-term unsecured debt
ratings of each Rating Agency (and no such rating shall include a subscript of
“f”, “r”, “p”, “pi”, “q” or “t”), provided, however, that securities issued by
any particular corporation will not be Eligible Investments to the extent that
investment therein will cause the then outstanding principal amount of
securities issued by such corporation and held as part of the Trust Estate to
exceed 20% of the sum of the Outstanding Note Balance and the aggregate
principal amount of all Eligible Investments in the Collection Account,
provided, further, that such securities will not be Eligible Investments if they
are published as being under review with negative implications from either
Rating Agency;

(4) commercial paper (including both non interest-bearing discount obligations
and interest-bearing obligations payable on demand or on a specified date not
more than 180 days after the date of issuance thereof) rated by each Rating
Agency in its highest short-term ratings (and no such rating shall include a
subscript of “f”, “r”, “p”, “pi”, “q” or “t”); and

(5) any other demand, money market fund, common trust estate or time deposit or
obligation, or interest-bearing or other security or investment (including those
managed or advised by the Indenture Trustee or an Affiliate thereof), rated in
the highest rating category by each Rating Agency (and no such rating shall
include a subscript of “f”, “r”, “p”, “pi”, “q” or “t”). Such investments in
this subsection (5) may include money market mutual funds rated either “AAAm” or
“AAAm-G” by S&P or common trust estates, including any other fund for which the
Indenture Trustee or an Affiliate thereof serves as an investment advisor,
administrator, shareholder servicing agent, and/or custodian or subcustodian,
notwithstanding that (x) the Indenture Trustee or an Affiliate thereof charges
and collects fees and expenses from such funds for services rendered, (y) the
Indenture Trustee or an Affiliate thereof charges and collects fees and expenses
for services rendered pursuant to the Indenture and Servicing Agreement, and
(z) services performed for such funds and pursuant to this Indenture and
Servicing Agreement may converge at any time;

provided, however, that (a) any Eligible Investment must be money-market or
other relatively risk-free instruments without options and with maturities no
later than the Business Day prior to the expected Payment Date, and (b) no such
instrument shall be an Eligible Investment if such instrument (1) evidences
either (x) a right to receive only interest payments with respect to the
obligations underlying such instrument or (y) both principal and interest
payments derived from obligations underlying such instrument and the principal
and interest payments with respect to such instrument provide a yield to
maturity of greater than 120% of the yield to maturity at par of such underlying
obligations, and (2) is purchased at a price in excess of par.

 

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“Eligible Timeshare Loan” shall mean a Timeshare Loan conforming to each of the
representations and warranties set forth in Schedule I to the Sale Agreement as
of the Funding Date, Transfer Date or, with respect to a Determination Date (and
the related Payment Date), the last day of the related Due Period, as the case
may be. Delinquent Timeshare Loans, Defaulted Timeshare Loans and Defective
Timeshare Loans, as of any date of determination, are not Eligible Timeshare
Loans.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and the rulings
issued thereunder.

“ERISA Affiliate” shall mean, with respect to any Person, (i) any corporation
which is a member of the same controlled group of corporations (within the
meaning of Section 414(b) of the Internal Revenue Code) as such Person; (ii) a
trade or business (whether or not incorporated) under common control (within the
meaning of Section 414(c) of the Internal Revenue Code) with such Person; or
(iii) for purposes of Code Section 412, a member of the same affiliated service
group (within the meaning of Section 414(m) of the Internal Revenue Code) as
such Person, any corporation described in clause (i) above or any trade or
business described in clause (ii) above.

“Errors” shall have the meaning specified in Section 5.19(f)(i) of the Indenture
and Servicing Agreement.

“Event of Default” shall have the meaning specified in Section 6.01 of the
Indenture and Servicing Agreement.

“Exchange Notes” shall mean notes issued pursuant to an Exchange Notes Indenture
in exchange for Notes held by an Extending Noteholder.

“Exchange Notes Indenture” shall have the meaning set forth in Section 2.13 of
the Indenture and Servicing Agreement.

“Excluded Loan Balance” as of any date of determination shall mean the sum of
the following:

(i) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
relating to a Timeshare Property at an RCC Resort or a GRM Resort exceeds 10.0%
of the Aggregate Loan Balance of all Borrowing Base Loans; plus

(ii) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
with an original term to stated maturity more than 120 months exceeds 30.0% of
the Aggregate Loan Balance of all Borrowing Base Loans; plus

(iii) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
with both an original term to stated maturity of more than 180 months and were
originated after the Closing Date, exceeds 5% of the Aggregate Loan Balance of
all Borrowing Base Loans; plus

 

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(iv) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
for which the related Obligor is a resident of the Highest State Concentration
exceeds 30.0% of the Aggregate Loan Balance of all Borrowing Base Loans; plus

(v) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
for which the related Obligor is a resident of the Highest Five State
Concentration exceeds 60.0% of the Aggregate Loan Balance of all Borrowing Base
Loans, plus

(vi) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
having a Foreign Obligor from the Highest Country Concentration exceeds 30.0% of
the aggregate Loan Balance of all Borrowing Base Loans having a Foreign Obligor;
plus

(vii) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
having a Foreign Obligor from the Highest Three Countries Concentration exceeds
60.0% of the aggregate Loan Balance of all Borrowing Base Loans having a Foreign
Obligor; plus

(viii) the Loan Balance of any Pre-Completion Loan with more than 9 months
remaining until its Anticipated Completion Date; plus

(ix) the amount by which the aggregate Loan Balance of all Pre-Completion Loans
with 9 months or less until their respective Anticipated Completion Date exceeds
7.5% of the Aggregate Loan Balance of all Borrowing Base Loans; plus

(x) the Loan Balance of any Pre-Completion Loan for which the related Unit is
not an Available Unit as of its Anticipated Completion date; plus

(xi) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
with a Loan Balance greater than $125,000 exceeds 15.0% of the Aggregate Loan
Balance of all Borrowing Base Loans; plus

(xii) the amount by which the aggregate Loan Balance of all Borrowing Base Loans
(other than Borrowing Base Loans related to an Upgrade) for which the related
Obligor did not have a Downpayment Percentage of at least 10% at the time of
purchase exceeds 10% of the Aggregate Loan Balance of all Borrowing Base Loans.

“Excluded Loan Group Balance” means for any Borrowing Base Loan Group, an amount
equal to the Excluded Loan Balance multiplied by a fraction, the numerator of
which is the aggregate Loan Balance of Borrowing Base Loans in such Borrowing
Base Loan Group and the denominator of which is the Aggregate Loan Balance of
the Borrowing Base Loans.

“Excluded Taxes” shall have the meaning set forth in Section 4.3 of the Note
Purchase Agreement.

 

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“Extended Portion” shall mean, with respect to any Purchaser Group or
Non-Conduit Committed Purchaser that is extending the Facility Termination Date
with respect to less than all of its Purchaser Commitment Amount, an amount
equal to the portion of such Purchaser Group or Non-Conduit Committed
Purchaser’s Purchaser Invested Amount that is being extended.

“Extending Noteholder” shall mean a Noteholder that is either (x) the Funding
Agent for a Purchaser Group that is an Extending Purchaser or (y) a Non-Conduit
Committed Purchaser that is an Extending Purchaser.

“Extending Noteholder’s Percentage” shall mean, as of any Facility Termination
Date, the percentage equivalent of a fraction (i) the numerator of which is
equal to the aggregate principal amount of the Notes held by each Extending
Noteholder (or, in the case of any Extending Noteholder which is extending its
Facility Termination Date for an amount that is less than its entire Purchaser
Commitment Amount, the Extended Portion with respect to such Extending
Noteholder) on such date and (ii) the denominator of which is equal to the
Outstanding Note Balance on such date.

“Extending Purchaser” shall mean a Purchaser Group or a Non-Conduit Committed
Purchaser other than a Non-Extending Purchaser.

“Face Amount” shall mean, with respect to any Commercial Paper, the amount to be
paid by the applicable Conduit on the maturity date of such Commercial Paper,
whether issued on a discount basis or on an interest-bearing basis.

“Facility Documents” shall mean, collectively, the Indenture and Servicing
Agreement, the Performance Guaranty, the Purchase Agreement, the Sale Agreement,
the Custodial Agreement, the Administration Agreement, the Trust Agreement, the
UCC financing statements, the Fee Letter, the Control Agreement, the Control
Account Intercreditor Agreement, each Hedge Agreement and all other agreements,
documents or instruments delivered in connection with the transactions
contemplated thereby, and “Facility Document” shall mean any of them.

“Facility Limit” shall mean, on any date of determination, the sum of the
Purchaser Commitment Amounts with respect to each of the Purchaser Groups and
the Non-Conduit Committed Purchasers on such date. The Facility Limit shall be
reduced by the Purchaser Commitment Amount of each Non-Extending Purchaser on
the Facility Termination Date with respect to such Non-Extending Purchaser (or,
in the case of an Extending Noteholder which is extending its Facility
Termination Date for an amount less than its entire Purchaser Commitment Amount,
the non-Extended Portion of the related Purchaser Commitment Amount). On the
Amendment Effective Date, the Facility Limit shall be $250,000,000.

“Facility Termination Date” shall mean, with respect to any Purchaser Group or
Non-Conduit Committed Purchaser, September 10, 2014, as such date may be
extended in accordance with Section 2.3(c) of the Note Purchase Agreement.

 

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“Fee Letter” shall mean, as the context shall require, the (i) Fee Letter among
the Issuer, the Performance Guarantor, MORI, each Purchaser, the Administrative
Agent, each Funding Agent and Non-Conduit Committed Purchaser relating to the
Up-Front Fees, (ii) Fee Letter among the Issuer, the Performance Guarantor, MORI
and the Structuring Agent relating to the Structuring Fee, or (iii) Fee Letter
among the Issuer, MORI, the Performance Guarantor and the Administrative Agent
relating to the Administrative Agent Fee, in each case, as such fee letter may
from time to time be amended, supplemented or otherwise modified in accordance
with its terms.

“FICO” means a credit risk score for individuals calculated using the model
developed by Fair, Isaac and Company. Any reference to a FICO score in a
Facility Document shall mean the FICO score attributed to any Domestic Obligor
at the time of sale of an interest in a Timeshare Property to such Domestic
Obligor; provided that if there is more than one Domestic Obligor with respect
to a Timeshare Loan, any reference to a FICO score in a Facility Document shall
mean the FICO score attributed to, (i) if such Timeshare Loan was originated on
or prior to November 30, 2005, either (A) the FICO score of the primary Domestic
Obligor or (B) the average of the FICO Scores of the primary and secondary
Domestic Obligor or (ii) if such Timeshare Loan was originated after
November 30, 2005, the primary Domestic Obligor, in each case at the time of
sale of an interest in a Timeshare Property to such Domestic Obligors.

“FICO 600 to 649 Loan Group” means all Borrowing Base Loans for which the
related Domestic Obligors have FICO scores in the range from and including 600
to and including 649.

“FICO 650 to 699 Loan Group” means all Borrowing Base Loans for which the
related Domestic Obligors have FICO scores in the range from and including 650
to and including 699.

“FICO 700 to 749 Loan Group” means all Borrowing Base Loans for which the
related Domestic Obligors have FICO scores in the range from and including 700
to and including 749.

“FICO 750 Plus Loan Group” means all Borrowing Base Loans for which the related
Domestic Obligors have FICO scores equal to or greater than 750.

“Financial Covenants” means (A) the covenant contained in the Corporate Revolver
Facility that relates to (1) Consolidated Tangible Net Worth, (2) the maximum
ratio of Consolidated Total Debt to Consolidated Adjusted EBITDA and (3) minimum
Consolidated Interest Coverage Ratio (as such terms are defined in the Corporate
Revolver Facility), (B) the Minimum Consolidated Tangible Net Worth Floor
Covenant and (C) any other numerical financial covenant or covenants found in
the Corporate Revolver Facility, as and when required under the Corporate
Revolver Facility.

“Fitch” shall mean Fitch, Inc.

 

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“Foreign Country” shall mean a jurisdiction that is not the “United States” (as
defined in Section 7701(a)(9) of the Code), Canada, Guam, Puerto Rico, the U.S.
Virgin Islands or any of the territories of the United States.

“Foreign Obligor” shall mean an Obligor who is not a Domestic Obligor.

“Foreign Timeshare Loan” means a Borrowing Base Loan for which the related
Obligor is a Foreign Obligor.

“Foreign Timeshare Loan Group I” means Borrowing Base Loans which are Foreign
Timeshare Loans with an aggregate Loan Balance up to and including an amount
equal to 25% of the Aggregate Loan Balance of all Borrowing Base Loans.

“Foreign Timeshare Loan Group II” means Borrowing Base Loans which are Foreign
Timeshare Loans with an aggregate Loan Balance in excess of 25% but less than
40% of the Aggregate Loan Balance of all Borrowing Base Loans.

“Funding Agent-Related Persons” shall mean the applicable Funding Agent,
together with its Affiliates, and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and their respective Affiliates.

“Funding Agent” shall have the meaning set forth in the Preliminary Statement of
the Note Purchase Agreement.

“Funding Date” shall mean the Initial Funding Date or the date on which the
Outstanding Note Balance is increased pursuant to Section 2.2 of the Note
Purchase Agreement.

“Funding Period” shall mean, with respect to any portion of the Purchaser
Invested Amount with respect to any Purchaser Group: (i) if such amount accrues
interest by reference to the CP Rate in accordance with Section 2.8 of the Note
Purchase Agreement a period selected by the Funding Agent for such Purchaser
Group and notified to the Issuer and with the consultation of the Issuer, it
being understood that such Funding Agent shall have the sole right to choose
such period; (ii) if such amount accrues interest by reference to the Adjusted
LIBOR Rate in accordance with Section 2.8 of the Note Purchase Agreement, the
period determined in accordance with Section 2.8 of the Note Purchase Agreement;
(iii) if such amount accrues interest by reference to the Bank Base Rate in
accordance with Section 2.8 of the Note Purchase Agreement, a period of from 1
to 30 days; provided, however, that whenever the last day of a Funding Period
would otherwise occur on a day other than a Business Day, the last day of such
Funding Period shall be extended to occur on the next succeeding Business Day.

“Funding Source” shall have the meaning set forth in Section 4.2 of the Note
Purchase Agreement.

“GAAP” generally accepted accounting principles in the United States as in
effect from time to time, except that for purposes of the Financial Covenants,
GAAP shall be determined on the basis of such principles in effect on the date
hereof and consistent with those used in the preparation of the most recent
audited financial statements referred to in Section 3.1(t)

 

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of the Note Purchase Agreement. In the event that any “Accounting Change” (as
defined below) shall occur and such change results in a change in the method of
calculation of financial covenants, standards or terms in the Indenture and
Servicing Agreement, then the Issuer and the Administrative Agent agree to enter
into negotiations in order to amend such provisions of the Indenture and
Servicing Agreement so as to reflect equitably such Accounting Changes with the
desired result that the criteria for evaluating the Performance Guarantor’s
financial condition shall be the same after such Accounting Changes as if such
Accounting Changes had not been made. Until such time as such an amendment shall
have been executed and delivered by the Issuer, the Administrative Agent and the
Majority Facility Investors, all financial covenants, standards and terms in the
Indenture and Servicing Agreement shall continue to be calculated or construed
as if such Accounting Changes had not occurred. “Accounting Changes” refers to
changes in accounting principles required by the promulgation of any rule,
regulation, pronouncement or opinion by the Financial Accounting Standards Board
of the American Institute of Certified Public Accountants or, if applicable, the
Securities and Exchange Commission.

“Governmental Authority” shall mean any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

“Grant” shall mean to grant, bargain, convey, assign, transfer, mortgage,
pledge, create and grant a security interest in and right of set-off against,
deposit, set over and confirm.

“GRM Resort” means a Resort operating under the Grand Residences by Marriott
brand.

“Gross Excess Spread Percentage” shall mean for any Due Period the percentage
equivalent of a fraction:

(A) the numerator of which is the product of:

(x) the sum of (i) all collections for such Due Period on the Borrowing Base
Loans attributable to interest and (ii) amounts received from a Qualified Hedge
Counterparty during such Due Period, minus the sum of (i) the Interest
Distribution Amount on the related Payment Date, (ii) the Servicing Fee on the
related Payment Date; and (iii) any Net Hedge Payment due on the related Payment
Date;

(y) 360, divided by the actual number of days in such Due Period, and

(B) the denominator of which is the average of the Aggregate Loan Balance at the
beginning and end of such Due Period.

“Hedge Agreement” shall mean collectively (i)(A) the related ISDA Master
Agreement, the related Schedule to the ISDA Master Agreement, and the related
Confirmation or (B) a long form confirmation, and (ii) to the extent applicable,
pursuant to Section 3.03(a)(ix) of the Indenture, an ISDA Credit Support Annex
relating thereto.

 

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“Hedge Agreement Collateral Posting Requirements” shall have the meaning set
forth in Section 3.03(a)(ix) of the Indenture and Servicing Agreement.

“Hedge Amortization Schedule” shall mean the amortization schedule prepared from
time to time by the Administrative Agent in accordance with Section 3.03(e) of
the Indenture in connection with the Hedge Agreements based on (i) the timeshare
loan data file prepared by the Issuer and the Servicer for the Administrative
Agent and (ii) the commercially reasonable assumptions regarding payment,
prepayment and defaults on the Timeshare Loans agreed upon by the Issuer and the
Administrative Agent in writing.

“Hedge Collateral Account” shall mean the account established and maintained by
the Indenture Trustee pursuant to Section 3.02(d) of the Indenture and Servicing
Agreement.

“Hedge Collateral Amount” shall have the meaning specified in Section 3.03 of
the Indenture and Servicing Agreement.

“Hedge Counterparty” shall mean the initial counterparty under a Hedge
Agreement, and any Qualified Hedge Counterparty to such Hedge Agreement
thereafter.

“Hedge Event of Default or Termination Event” shall mean any event of default or
termination event under a Hedge Agreement.

“Hedge Requirements” shall have the meaning specified in Section 3.03 of the
Indenture and Servicing Agreement.

“Hedge Termination Payment” shall mean any termination payment due to a Hedge
Counterparty as a result of a termination of a Hedge Agreement.

“Highest Country Concentration” shall mean, with respect to all the Borrowing
Base Loans, the Foreign Country with the highest concentration of Foreign
Obligors, measured by Loan Balance.

“Highest Five State Concentration” shall mean, with respect to all the Borrowing
Base Loans, the states in the United States with the five highest concentrations
of Obligors, measured by Loan Balance.

“Highest Lawful Rate” shall have the meaning specified in Section 3 of the Sale
Agreement.

“Highest State Concentration” shall mean, with respect to all the Borrowing Base
Loans, the state in the United States with the highest concentration of
Obligors, measured by Loan Balance.

“Highest Three Countries Concentration” shall mean, with respect to all the
Borrowing Base Loans, the Foreign Countries with the three highest
concentrations of Foreign Obligors, measured by Loan Balance.

 

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“Holder” or “Noteholder” shall mean a holder of any Note.

“Increase” shall have the meaning set forth in Section 2.2(a) of the Note
Purchase Agreement.

“Indemnified Amounts” shall have the meaning set forth in Section 4.1 of the
Note Purchase Agreement.

“Indemnified Parties” shall have the meaning set forth in Section 4.1 of the
Note Purchase Agreement.

“Indenture and Servicing Agreement” shall mean the second amended and restated
indenture and servicing agreement, dated as of September 1, 2012, among the
Issuer, the Servicer, the Indenture Trustee and the Back-Up Servicer, as such
agreement may from time to time be amended, supplemented or otherwise modified
in accordance with its terms.

“Indenture Trustee” shall mean Wells Fargo Bank, National Association, or such
successor as set forth in Section 7.09 of the Indenture and Servicing Agreement.

“Indenture Trustee Expenses” shall mean reasonable out-of-pocket expenses of the
Indenture Trustee incurred in connection with performance of the Indenture
Trustee’s obligations and duties under the Indenture and Servicing Agreement.

“Indenture Trustee Fee” shall equal $1,500 per month.

“Initial Funding Date” shall mean the date initial advances are made on the
Notes pursuant to Sections 2.2 and 3.3 of the Note Purchase Agreement.

“Initial Outstanding Note Balance” shall be zero on the Closing Date and
thereafter shall have the meaning set forth in Section 2.1 of the Note Purchase
Agreement.

“Initial Trial Balance” shall have the meaning specified in Section 5.19 of the
Indenture and Servicing Agreement.

“Insurance Proceeds” means (i) proceeds of any insurance policy, including
property insurance policies, casualty insurance policies and title insurance
policies and (ii) any condemnation proceeds, in each case which relate to the
Timeshare Loans or the Timeshare Properties and are paid or required to be paid
to, and may be retained by, the Issuer, any of its Affiliates or to any
mortgagee of record.

“Intended Tax Characterization” shall have the meaning specified in
Section 4.04(b) of the Indenture and Servicing Agreement.

“Interest Accrual Period” shall mean, with respect to a Payment Date, the period
beginning on and including the immediately preceding Payment Date and ending on
and excluding such Payment Date; provided that the initial Interest Accrual
Period will begin on and include the Closing Date and end on and exclude the
initial Payment Date.

 

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“Interest Distribution Amount” shall mean for each Note on any Payment Date, the
sum of:

(i) an amount equal to the Carrying Costs for the related Interest Accrual
Period with respect to a Non-Conduit Committed Purchaser that holds such Note or
the Purchaser Group in whose Funding Agent’s name such Note is registered, as
applicable, as such amount is reported to the Indenture Trustee by the
Administrative Agent or the Servicer, and

(ii) the related Usage Fees; and

(iii) any unpaid Interest Distribution Amounts from prior Payment Dates plus, to
the extent permitted by law, interest thereon at the rate used to calculate the
Carrying Cost plus the rate used to calculate the Usage Fees for such Payment
Date.

“Issuer” shall mean Marriott Vacations Worldwide Owner Trust 2011-1, a Delaware
statutory trust, together with its successors and permitted assigns.

“Issuer Order” shall mean a written order or request delivered to the Indenture
Trustee and signed in the name of the Issuer by an Authorized Officer.

“Law” shall mean any applicable law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or
award of any Official Body or Governmental Authority.

“LIBOR Rate” shall mean, (a) with respect to any Funding Period, the rate per
annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing on
Reuters Screen LIBOR01 Page (or any successor page) as the London interbank
offered rate for deposits in U.S. dollars at approximately 11:00 A.M. (London
time) two London Business Days prior to the first day of such Funding Period for
a term equal to the length of such Funding Period, as determined in accordance
with Section 2.8 of the Note Purchase Agreement or (b) with respect to any day
during an Interest Accrual Period, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01 Page
(or any successor page or such other page or service as each Non-Conduit
Committed Purchaser shall determine in its sole discretion) as the London
interbank offered rate for deposits in U.S. dollars for a term of thirty
(30) days at approximately 11:00 A.M. (London time) on such day, or if such day
is not a London Business Day on the immediately preceding London Business Day;
provided, however, if more than one rate is specified on the applicable page or
screen, the applicable rate shall be the arithmetic mean of all such rates. If
for any reason such rate is not available, the term “LIBOR Rate” shall mean,
(a) for any Funding Period, the rate at which deposits in U.S. dollars are
offered to the applicable Funding Agent in the London interbank market at
approximately 11:00 A.M. (London time) two London Business Days prior to the
first day of such Funding Period for a term equal to the length of such Funding
Period or (b) for any day during an Interest Accrual Period, the rate at which
deposits in U.S. dollars are offered to the applicable Non-Conduit Committed
Purchaser in the London interbank market at approximately 11:00 A.M. (London
time) on such day, or if such day is not a London Business Day on the
immediately preceding London Business Day for a term of thirty (30) days.

 

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“Lien” shall mean any mortgage, pledge, hypothecation, assignment for security,
security interest, claim, participation, encumbrance, levy, lien or charge.

“Liquidation” shall mean with respect to any Defaulted Timeshare Loan, the sale
or compulsory disposition of the related Timeshare Property, following
foreclosure, other enforcement action or the taking of a deed-in-lieu of
foreclosure, to a Person other than the Servicer or the Issuer and the delivery
of a bill of sale or the recording of a deed of conveyance with respect thereto,
as applicable.

“Liquidation Expenses” shall mean, with respect to a Defaulted Timeshare Loan,
the out-of-pocket expenses (exclusive of overhead expenses) incurred by the
Servicer in connection with the performance of its obligations under Sections
5.03 (a) (vii) through (ix) in the Indenture and Servicing Agreement, including
(i) any foreclosure and other repossession expenses incurred with respect to
such Timeshare Loan, (ii) (a) if MORI or an Affiliate thereof (a “MVW Servicer”)
is the Servicer, commissions and marketing and sales expenses incurred with
respect to the sale of the related Timeshare Property or Vacation Interest
(calculated as the MVW Average Marketing and Sales Percentage of the total
liquidation or resale price of such Timeshare Property or Vacation Interest
(expressed as a dollar figure)), or (b) if a MVW Servicer is no longer the
Servicer or, a MVW Servicer in its sole discretion elects to permanently cease
using the methodology described in (a) above, actual commissions and actual
marketing and sales expenses incurred with respect to the sale of the related
Timeshare Property or Vacation Interest, and (iii) any other fees and expenses
reasonably applied or allocated in the ordinary course of business with respect
to the Liquidation of such Defaulted Timeshare Loan (including any assessed
timeshare association fees); provided, however, that in each case, any fees,
expenses and commissions must be commercially reasonable and incurred in
accordance with the Servicing Standard.

“Liquidation Proceeds” shall mean with respect to the Liquidation of any
Defaulted Timeshare Loan, the amounts actually received by the Servicer in
connection with such Liquidation including any rental income, less related
rental expenses.

“Liquidity Agreement” shall mean an agreement between a Conduit and a Liquidity
Provider evidencing the obligation of such Liquidity Provider to provide
liquidity support, credit enhancement or asset purchase facilities for or in
respect of any assets or liabilities of such Conduit in connection with the
issuance by such Conduit of Commercial Paper or the borrowing by such Conduit of
the proceeds of Commercial Paper.

“Liquidity Provider” shall mean the Person or Persons who will provide liquidity
or program support to a Conduit in connection with the issuance by such Conduit
of Commercial Paper or the borrowing by such Conduit of the proceeds of
Commercial Paper.

“Loan Balance” shall mean, for any date of determination, the outstanding
principal balance due under or in respect of a Timeshare Loan (including a
Defaulted Timeshare Loan).

 

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“Loan Number” shall mean, with respect to any Timeshare Loan, the number
assigned to such Timeshare Loan by the Servicer, which number is set forth in
the related Schedule of Timeshare Loans, as amended from time to time.

“London Business Day” shall mean, with respect to the determination of the LIBOR
Rate, any Business Day other than a Business Day on which banking institutions
in London, England trading in dollar deposits in the London interbank market are
authorized or obligated by law or executive order to be closed.

“Lost Note Affidavit” shall mean the affidavit to be executed in connection with
any delivery of a copy of an original Obligor Note in lieu of such original, in
the form of Exhibit C attached to the Purchase Agreement and the Sale Agreement.

“Major Credit Card” shall mean a credit card issued by any VISA USA, Inc.,
MasterCard International Incorporated, American Express Company, Discover Bank
or Diners Club International Ltd. credit card affiliate or member entity.

“Majority Facility Investors” shall mean at any time, Purchaser Groups and/or
Non-Conduit Committed Purchasers having Commitment Percentages aggregating more
than 51%.

“Majority Purchaser Group Investors” shall mean at any time, with respect to
each Purchaser Group, the Alternate Purchasers with respect to such Purchaser
Group having Alternate Purchaser Percentages aggregating more than 51%.

“Mandatory Redemption Date” means the Payment Date occurring in the 13th
calendar month after the calendar month in which the last Facility Termination
Date occurs; provided, however, if, on the Facility Termination Date, an
Amortization Event exists, the Mandatory Redemption Date means the Payment Date
occurring in the 6th calendar month after the calendar month in which the
Facility Termination Date occurs.

“Margin Stock” shall have the meaning provided in Regulation U.

“Marriott International” shall mean Marriott International, Inc., a Delaware
corporation.

“Marriott License Agreement” means the license, services and development
agreement, entered into on November 17, 2011 by and among Marriott
International, MVW and the other signatories thereto pursuant to which, among
other things, MVW is granted the exclusive right, for the term of such
agreement, to use certain “Marriott” marks and intellectual property in
connection with MVW’s Vacation Ownership Business.

“Material Adverse Effect” shall mean, with respect to any Person and any event
or circumstance, a material adverse effect on (a) the business, properties,
operations or condition (financial or otherwise) of such Person, (b) the ability
of such Person to perform its respective obligations under any Facility
Documents to which it is a party, (c) the validity or enforceability of, or
collectability of amounts payable under, any Facility Documents to which it is a
party, (d) the status, existence, perfection or priority of any Lien granted by
such Person under any Facility Documents to which it is a party, or (e) the
value, validity, enforceability or collectability of the Trust Estate.

 

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“Minimum Consolidated Tangible Net Worth Floor Covenant” shall mean the
requirement that the Consolidated Tangible Net Worth of MVW must be, at all
times, at least $700,000,000.

“Miscellaneous Payments” shall mean, with respect to any Timeshare Loan, any
amounts received from or on behalf of the related Obligor representing
assessments, payments relating to real property taxes, insurance premiums,
maintenance fees and charges and condominium association fees and any other
payments not owed under the related Obligor Note.

“Monthly Reports” shall have the meaning specified in Section 5.19(b) of the
Indenture and Servicing Agreement.

“Monthly Servicer Report” shall have the meaning specified in Section 5.05 of
the Indenture and Servicing Agreement.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“MORI” shall mean Marriott Ownership Resorts, Inc., a Delaware corporation.

“MORI Affiliated Manager” shall mean Marriott Resorts Hospitality Corporation, a
wholly-owned subsidiary of MORI, Marriott Resorts Hospitality (Bahamas) Limited,
a wholly owned subsidiary of Marriott Resorts Hospitality Corporation or another
Affiliate of MORI, as applicable, together with their respective successors and
assigns.

“Mortgage” shall mean the original recorded mortgage, deed of trust or other act
or instrument creating a first priority lien on a Timeshare Property securing a
Mortgage Loan, or a copy thereof certified by the applicable recording office.

“Mortgage Loan” shall mean any Timeshare Loan that is not a Right-To-Use Loan.
As used in the Facility Documents, the term “Mortgage Loan” shall include the
related Obligor Note, Mortgage and other security documents contained in the
related Timeshare Loan File.

“MVC Trust” shall mean MVC Trust, a Florida land trust (Florida Land Trust
No. 1082-0300-00) established pursuant to the MVC Trust Agreement.

“MVC Trust Agreement” shall mean that certain trust agreement, dated March 11,
2010, by and among MORI, First American Trust, FSB and MVC Trust Owners
Association, a Florida corporation not for profit.

“MVC Trust Association” means MVC Trust Owners Association, Inc., a Florida
not-for-profit corporation

 

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“MVC Trustee” shall mean First American Trust, FSB, as Trustee of the MVC Trust.

“MVW” shall mean Marriott Vacations Worldwide Corporation, a Delaware
corporation.

“MVW Average Marketing and Sales Percentage” shall mean, with respect to any
Payment Date, (a) the sum of the MVW Marketing and Sales Percentages for the
three four-week accounting periods immediately preceding the first day of the
calendar month in which such Payment Date occurs, divided by (b) three.

“MVW Entity” means any of (a) the Issuer, (b) the Seller, (c) MORI and (d) the
Performance Guarantor.

“MVW Marketing and Sales Percentage” shall mean (a) the marketing and sales
expenses (including sales commissions) incurred by all resorts of the applicable
Marriott Vacation Club International brand during a four-week accounting period,
divided by (b) the aggregate sales revenue for all resorts of the applicable
Marriott Vacation Club International brand during such four-week accounting
period (expressed as a percentage).

“MVW Resort” shall mean a resort of any Marriott Vacation Club International
brand, including but not limited to, The Ritz-Carlton Club, The Ritz-Carlton
Destination Club, Marriott Vacation Club Destinations and Grand Residences by
Marriott, in which a fractional interest in one or more residential units or
dwellings thereof has been conveyed to the MVC Trust.

“MVW Resort Association” shall mean a timeshare association relating to any MVW
Resort.

“MVW Servicer” shall have the meaning set forth in the definition of Liquidation
Expenses.

“MVW Unit” shall mean a residential unit or dwelling at a MVW Resort.

“Net Hedge Payment” shall mean the net amount, if any, then payable by the
Issuer to the Hedge Counterparty under a Hedge Agreement, excluding any Hedge
Termination Payment.

“Non-Conduit Committed Purchaser” shall mean any Purchaser which is designated
as a Non-Conduit Committed Purchaser on Schedule I to the Note Purchase
Agreement or in the Assignment and Assumption Agreement pursuant to which such
Purchaser became a party to the Note Purchase Agreement, and any permitted
assignee thereof.

“Non-Extending Purchaser” means any Purchaser Group or Non-Conduit Committed
Purchaser who shall not have agreed to an extension of its Facility Termination
Date pursuant to Section 2.3(c) of the Note Purchase Agreement.

 

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“Note Purchase Agreement” shall mean that amended and restated note purchase
agreement, dated the Amendment Effective Date, by and among the Issuer, the
Seller, the Performance Guarantor, the Servicer, the Purchasers, Funding Agents
and the Administrative Agent.

“Note Register” shall have the meaning specified in Section 2.03(a) of the
Indenture and Servicing Agreement.

“Note Registrar” shall have the meaning specified in Section 2.03(a) of the
Indenture and Servicing Agreement.

“Notes” shall mean the Issuer’s Timeshare Loan-Backed Variable Funding Notes,
Series 2011-1, issued pursuant to the Indenture and Servicing Agreement.

“Notes Increase Amount” shall have the meaning set forth in Section 2.2(a) of
the Note Purchase Agreement.

“NPA Costs” means, as of any Payment Date, the Breakage and Other Costs due and
payable on such Payment Date in accordance with the Note Purchase Agreement.

“Obligations” shall have the meaning set forth in Section 1(a)(ii) of the
Performance Guaranty.

“Obligor” shall mean a Person obligated to make payments under a Timeshare Loan.

“Obligor Note” shall mean the original, executed promissory note or other
instrument of indebtedness evidencing the indebtedness of an Obligor under a
Timeshare Loan, which note or instrument shall be substantially in the form of
Exhibit B attached to the Sale Agreement, together with any rider, addendum or
amendment thereto, or any renewal, substitution or replacement of such note or
instrument.

“Officer’s Certificate” shall mean a certificate executed by a Responsible
Officer of the related party.

“Official Body” shall mean any government or political subdivision or any
agency, authority, bureau, central bank, commission, department or
instrumentality of any such government or political subdivision, or any court,
tribunal, grand jury or arbitrator, in each case whether foreign or domestic.

“Opinion of Counsel” shall mean a written opinion of counsel, in each case
reasonably acceptable to the addressees thereof.

“Originator” shall mean, with respect to a Timeshare Loan, the original lender,
mortgagee or similar party.

 

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“Other Issuer” shall mean any Person other than the Issuer that has entered into
a receivables purchase agreement, transfer and administration agreement or other
similar agreement with the applicable Conduit.

“Outstanding” shall mean, with respect to the Notes, as of any date of
determination, all Notes theretofore authenticated and delivered under the
Indenture and Servicing Agreement except:

(a) Notes theretofore canceled by the Indenture Trustee or delivered to the
Indenture Trustee for cancellation;

(b) Notes or portions thereof for whose payment money in the necessary amount
has been theretofore irrevocably deposited with the Indenture Trustee in trust
for the holders of such Notes for the payment of principal; and

(c) Notes in exchange for or in lieu of which other Notes have been
authenticated and delivered pursuant to the Indenture and Servicing Agreement
unless proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a Person in whose hands the Note is a valid obligation;
provided, however, that in determining whether the holders of the requisite
percentage of the Outstanding Note Balance have given any request, demand,
authorization, direction, notice, consent, or waiver hereunder, Notes owned by
the Issuer or any Affiliate of the Issuer or any entity consolidated in MORI’s
and/or MVW’s consolidated financial statements shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the Indenture Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent, or waiver, only Notes that a Responsible Officer of
the Indenture Trustee actually has notice are so owned shall be so disregarded.

“Outstanding Note Balance” shall mean, as of any date of determination, the
Initial Outstanding Note Balance plus (i) the aggregate amount of Increases made
with respect to the Notes pursuant to the Indenture and Servicing Agreement and
the Note Purchase Agreement, less (ii) the aggregate amount of all principal
payments on the Notes on or prior to such date of determination, less (iii) the
principal amount of any Notes cancelled pursuant to Section 2.13 of the
Indenture and Servicing Agreement; provided, that any principal payments
required to be returned to the Issuer shall be reinstated to the Outstanding
Note Balance. For purposes of consents, approvals, voting or other similar acts
of the Noteholders under any of the Facility Documents, “Outstanding Note
Balance” shall exclude amounts with respect to Notes or interests in Notes which
are held by the Issuer or any Affiliate of the Issuer or any entity consolidated
in MORI’s and/or MVW’s consolidated financial statements.

“Owner” shall mean MVCO Series LLC, a Delaware limited liability company, or any
subsequent owner of the beneficial interest in the Issuer.

“Owner Trustee” shall mean Wilmington Trust, National Association, or any
successor thereof, acting not in its individual capacity but solely as trustee
under the Trust Agreement.

 

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“Owner Trustee Fee” shall equal $4,500 a year paid in accordance with
Section 3.04 of the Indenture and Servicing Agreement.

“Participants” shall have the meaning set forth in Section 5.10(e) of the Note
Purchase Agreement.

“Payment Date” shall mean the 20th day of each calendar month, or, if such date
is not a Business Day, then the next succeeding Business Day, commencing in
October 2011.

“PAC” shall mean an arrangement whereby an Obligor makes payments under the
Timeshare Loan via pre-authorized debit.

“Percentage Interest” shall mean, as of any date with respect to any Purchaser
Group or Non-Conduit Committed Purchaser, the percentage equivalent of a
fraction, (i) the numerator of which is the outstanding principal amount on such
date of the Note registered in the name of the Funding Agent for such Purchaser
Group or such Non-Conduit Purchaser, as applicable and (ii) the denominator of
which is the Outstanding Note Balance on such date.

“Performance Guarantor” shall mean MVW or its successor.

“Performance Guaranty” shall mean that amended and restated performance
guaranty, dated as of September 1, 2012, given by the Performance Guarantor in
favor of the Issuer and the Indenture Trustee.

“Permitted Liens” shall mean, as to any Timeshare Property, (a) the lien of
current real property taxes, maintenance fees, ground rents, water charges,
sewer rents and assessments not yet due and payable, (b) covenants, conditions
and restrictions, rights of way, easements and other matters of public record,
none of which, individually or in the aggregate, materially interferes with the
current use of the Timeshare Property or the security intended to be provided by
the related Mortgage or with the Obligor’s ability to pay his or her obligations
when they become due or materially and adversely affects the value of the
Timeshare Property and (c) the exceptions (general and specific) set forth in
the related title insurance policy, none of which, individually or in the
aggregate, materially interferes with the security intended to be provided by
such Mortgage or with the Obligor’s ability to pay his or her obligations when
they become due or materially and adversely affects the value of the Timeshare
Property.

“Permitted Transferee” shall mean any commercial paper conduit, bank, financial
institution or other Person, as applicable (i) which is an existing Purchaser,
(ii) the unsecured debt obligations of which are rated no lower than the
applicable rating of the Purchaser from which it is purchasing an interest in a
Note pursuant to Section 5.10 or (iii) to which the Issuer has consented
becoming a Purchaser (such consent not to be unreasonably withheld).

“Person” shall mean an individual, partnership, limited liability company,
corporation, joint stock company, trust (including a business trust),
unincorporated association, joint venture, firm, enterprise, Official Body or
any other entity.

 

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“Post-Office Box” shall mean each post office box to which Obligors are directed
to make payments in respect of the Timeshare Loans. A list of all Post-Office
Boxes on the Amendment Effective Date has been provided by the Issuer (or its
agent) to the Administrative Agent and the Indenture Trustee.

“Potential Amortization Event” means an event which, but for the lapse of time
or the giving of notice or both, would constitute an Amortization Event.

“Potential Event of Default” means an event which, but for the lapse of time or
the giving of notice or both, would constitute an Event of Default.

“Potential Servicer Event of Default” means an event which, but for the lapse of
time or the giving of notice or both, would constitute a Servicer Event of
Default.

“Pre-Completion Loan” shall mean any Weeks-Based Timeshare Loan for which the
related Unit is not completed and located in or on the floor or building in the
Resort specified in the related Additional Timeshare Loan Supplement, or is not
ready for occupancy by timeshare owners. A Timeshare Loan shall cease to be a
Pre-Completion Loan on the date on which the related Unit’s construction has
been completed in accordance with applicable brand standards and becomes
available for occupancy by timeshare owners.

“Predecessor Servicer Work Product” shall have the meaning specified in
Section 5.19 of the Indenture and Servicing Agreement.

“Prepayment Notice” shall have the meaning set forth in Section 10.01 of the
Indenture and Servicing Agreement.

“Pricing Increase Notice” shall have the meaning set forth in Section 2.8(a) of
the Note Purchase Agreement.

“Pricing Increase Rescission” shall have the meaning set forth in Section 2.8(a)
of the Note Purchase Agreement.

“Principal Distribution Amount” shall mean an amount equal to the Borrowing Base
Shortfall on such Payment Date.

“Processing Charges” shall mean any amounts due under an Obligor Note in respect
of processing fees, service fees or late fees.

“Purchase Agreement” shall mean the amended and restated purchase agreement,
dated as of September 1, 2012, by and between MORI and the Seller pursuant to
which MORI sells the Timeshare Loans to the Seller.

“Purchase Contract” shall mean the purchase contract pursuant to which an
Obligor purchased a Timeshare Property.

 

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“Purchase Price” shall mean the original price of the Timeshare Property
purchased by an Obligor.

“Purchasers” shall mean, collectively, the Conduits and the Committed
Purchasers.

“Purchaser Addition Date” shall have the meaning set forth in Section 2.3(d) of
the Note Purchase Agreement.

“Purchaser Assignment and Assumption Agreement” shall mean an Assignment and
Assumption Agreement substantially in the form of Exhibit B to the Note Purchase
Agreement.

“Purchaser Commitment Amount” shall mean (x) with respect to any Purchaser
Group, the aggregate Commitments of the Alternate Purchasers which are members
of such Purchaser Group and (y) with respect to any Non-Conduit Committed
Purchaser, the Commitment of such Non-Conduit Committed Purchaser. The Purchaser
Commitment Amount with respect to each Purchaser Group or Non-Conduit Committed
Purchaser shall be reduced to zero on the Facility Termination Date with respect
to such Purchaser Group or Non-Conduit Committed Purchaser.

“Purchaser Fees” shall have the meaning specified in the Fee Letter.

“Purchaser Group” shall mean, collectively, a Conduit and the Alternate
Purchaser or Alternate Purchasers with respect to such Conduit.

“Purchaser Invested Amount” means, with respect to any Purchaser Group or
Non-Conduit Committed Purchaser as of any date, such Purchaser Group’s or
Non-Conduit Committed Purchaser’s Percentage Interest multiplied by the
Outstanding Note Balance on such date.

“Purchaser Termination Date” shall mean, with respect to each Purchaser Group or
Non-Conduit Committed Purchaser, the earlier of (i) the date on which an
Amortization Event or an Event of Default occurs and (ii) two Business Days
prior to the Facility Termination Date with respect to such Purchaser Group or
Non-Conduit Committed Purchaser.

“Qualified Hedge Counterparty” means (a) a counterparty to a Hedge Agreement
which has a long-term unsecured debt rating of at least “A” from S&P and a
short-term unsecured debt rating of at least “A-1” from S&P, or (b) a
counterparty to an existing Hedge Agreement which experiences a downgrade by S&P
below the ratings specified in clause (a) above but satisfies the Hedge
Agreement Collateral Posting Requirements; provided that for purposes of this
clause (b), a downgraded counterparty shall cease to be a Qualified Hedge
Counterparty if such counterparty has a long-term unsecured debt rating below
BBB- or has not been upgraded to meet the requirements of clause (a) above
within 60 days of such downgrade.

“Qualified Substitute Timeshare Loan” shall mean a Timeshare Loan which on the
related Transfer Date is an Eligible Timeshare Loan.

 

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“Rating Agencies” shall mean S&P and Moody’s, or their permitted successors and
assigns.

“RCC Resort” means a Resort operating under The Ritz-Carlton Club brand.

“Receivables” shall mean all funds, collections and other proceeds of a
Timeshare Loan including without limitation (i) all scheduled payments or
recoveries made in the form of money, checks, and like items to, or a wire
transfer or an automated clearinghouse transfer received by the Issuer, the
Servicer or the Indenture Trustee in respect of such Timeshare Loan, and
(ii) all amounts received by the Issuer, the Servicer or the Indenture Trustee
in respect of the Related Security for such Timeshare Loan.

“Recipient” shall have the meaning set forth in Section 2.6 of the Note Purchase
Agreement.

“Record Date” shall mean, with respect to any Payment Date, the close of
business on the last Business Day of the month preceding the month in which such
Payment Date occurs.

“Records” shall mean all Timeshare Loan Files and other documents, books,
records and other information (including, without limitation, computer programs,
tapes, discs, punch cards, data processing software and related property and
rights) maintained with respect to Timeshare Loans and the related Obligors.

“Regulatory Change” shall have the meaning set forth in Section 4.2 of the Note
Purchase Agreement.

“Related Additional Alternate Purchasers” shall have the meaning set forth in
Section 2.3(d) of the Note Purchase Agreement.

“Related Commercial Paper” shall mean, with respect to any Conduit, the
Commercial Paper of such Conduit, all or a portion of the proceeds of which were
used to finance the acquisition or maintenance of an interest in the Notes.

“Related Security” shall mean with respect to any Timeshare Loan and with
respect to the Purchase Agreement, the Sale Agreement or the Indenture and
Servicing Agreement, as applicable, (i) all of the Purchaser’s, the Seller’s or
the Issuer’s interest, as applicable, in the Timeshare Property arising under or
in connection with the related Mortgage or Right-to-Use Agreement, and the
related Timeshare Loan Files relating to such Timeshare Loan, but not including
any Miscellaneous Payments, (ii) all other security interests or liens and
property subject thereto from time to time purporting to secure payment of such
Timeshare Loan, together with all mortgages, assignments and financing
statements signed by an Obligor describing any collateral securing such
Timeshare Loan, (iii) all guarantees, insurance and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Timeshare Loan, (iv) all other security and books, records and
computer tapes relating to the foregoing and (v) with respect to the Indenture
and Servicing Agreement, all of the Issuer’s right, title and interest in and to
the Custodial Agreement and the Collection Account (or any other account into
which collections in respect of the Timeshare Loans may be deposited from time
to time).

 

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“Relevant UCC” shall mean the Uniform Commercial Code as in effect in the
applicable jurisdiction.

“Renewal Fee Letter” shall mean, as the context shall require, the (i) Fee
Letter among the Issuer, the Performance Guarantor, MORI, each Purchaser, the
Administrative Agent, each Funding Agent and Non-Conduit Committed Purchaser
relating to the Up-Front Renewal Fees, (ii) Fee Letter among the Issuer, the
Performance Guarantor, MORI and the Structuring Agent relating to the
Structuring Renewal Fee, or (iii) Fee Letter among the Issuer, MORI, the
Performance Guarantor and the Administrative Agent relating to the
Administrative Agent Fee, in each case, as such fee letter may from time to time
be amended, supplemented or otherwise modified in accordance with its terms.

“Repurchase Price” shall mean with respect to any Timeshare Loan to be
repurchased by the Seller pursuant to the Sale Agreement, a cash price equal to
the Loan Balance of such Timeshare Loan as of the date of such repurchase,
together with all accrued and unpaid interest on such Timeshare Loan at the
related coupon rate to but not including the due date in the then current Due
Period; provided that the “Repurchase Price” with respect to any Defaulted
Timeshare Loan repurchased by the Seller pursuant to the Sale Agreement prior to
the date which is two years after the Amendment Effective Date, shall mean a
cash price equal to the Loan Balance of such Defaulted Timeshare Loan as of the
date of such repurchase.

“Repurchased Timeshare Loans” shall mean the most seasoned $30,000,000 of
Timeshare Loans that were part of the Securitized Portfolio and were released
from the related securitization pursuant to a clean-up call, optional redemption
or similar mechanism and subsequently sold by the Seller to the Issuer pursuant
to the Sale Agreement and included as Borrowing Base Loans.

“Request for Release” shall be a request signed by the Servicer in the form
attached as Exhibit B to the Custodial Agreement.

“Required Cap Rate” means for any Interest Accrual Period and for any Hedge
Agreement in the form of an interest rate cap, the weighted average coupon for
the Borrowing Base Loans as of the last day of the related Due Period, less
8.50%.

“Required Facility Investors” shall mean at any time Purchaser Groups and/or
Non-Conduit Committed Purchasers having Commitment Percentages aggregating more
than 66 2/3%.

“Required Payments” shall mean with respect to any Payment Date, the items set
forth in (i) through (xii) of Section 3.04(a) of the Indenture and Servicing
Agreement without regard to Available Funds.

“Required Rating” shall have the meaning set forth in Section 3.7 of the Note
Purchase Agreement.

 

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“Reserve Account” shall mean the account maintained by the Indenture Trustee
pursuant to Section 3.02(b) of the Indenture and Servicing Agreement.

“Reserve Account Draw Amount” shall have the meaning specified in
Section 3.02(b)(ii) of the Indenture and Servicing Agreement.

“Reserve Account Required Balance” shall mean for any date of determination,
0.50% of the Aggregate Loan Balance of the Borrowing Base Loans.

“Reserve Account Required Funding Date Deposit” means, as of any Funding Date,
the amount required to be deposited on such Funding Date such that the amount on
deposit in the Reserve Account is equal to the Reserve Account Required Balance.
For purposes of calculating the Reserve Account Required Funding Date Deposit
for a Funding Date, the Aggregate Loan Balance shall be measured as of the last
day of the Due Period related to the immediately preceding Payment Date (or,
with respect to the Additional Timeshare Loans conveyed on such Funding Date or
Timeshare Loan conveyed during the same Due Period, the related Cut-off Date).

“Resort” shall mean any of the following resorts: Aruba Ocean Club; Aruba Surf
Club; Barony Beach Club; BeachPlace Towers; Canyon Villas; Crystal Shores;
Custom House; Cypress Harbour; Desert Springs Villas; Desert Springs Villas II;
Douglas at Streamside; Grand Chateau; Evergreen at Streamside; Fairway Villas;
Frenchman’s Cove; Marriott Grand Residence Club, Lake Tahoe; Grande Ocean
Resort; Grande Vista; Heritage Club; Harbour Club; Harbour Lake; Imperial Palms
Villas; Kauai Resort and Beach Club; Kauai Lagoons – Kalanipu’u; Ko Olina Beach
Club; Lakeshore Reserve at Grande Lakes; Legends Edge at Bay Point; Monarch at
Sea Pines; Manor Club at Ford’s Colony; Maui Ocean Club; Mountain Valley Lodge;
MountainSide; Marriott Vacation Club Destinations (Points); Newport Coast
Villas; Ocean Pointe; Oceana Palms; OceanWatch at Grande Dunes; Royal Palms;
Sabal Palms; St. Kitts Beach Club; Shadow Ridge; Summit Watch; SurfWatch; Timber
Lodge; Villas at Doral; Waiohai Beach Club; Willow Ridge Lodge; The Ritz-Carlton
Club, Aspen Highlands; The Ritz-Carlton Club, Bachelor Gulch; The Ritz-Carlton
Club, Jupiter; The Ritz-Carlton Club, Lake Tahoe; The Ritz-Carlton Club, San
Francisco; The Ritz-Carlton Club, St. Thomas; or the Ritz-Carlton Club, Vail.

“Resort Associations” shall mean any of the following associations: Aspen
Highlands Condominium Association, Inc.; Association of Apartment Owners of
Marriott’s Kauai Resort and Beach Club; Association of Apartment Owners of Maui
Ocean Club; Association of Owners of Waiohai Beach Club; Association of Owners
of Kalanipu’u Condominium; Barony Beach Club Owners’ Association, Inc.;
BeachPlace Towers Condominium Association, Inc.; Canyon Villas Vacation Owners
Association; Cooperatieve Vereniging Aruba Surf Club a/k/a Aruba Surf Club
Cooperative Association; Cooperatieve Vereniging Marriott Vacation Club of Aruba
a/k/a Marriott Vacation Club International of Aruba Cooperative Association;
Crystal Shores Condominium Association, Inc.; Custom House Leasehold Condominium
Association, LLC; Cypress Harbour Condominium Association, Inc.; Desert Springs
Villas Timeshare Association; Desert Springs Villas Master Association; Desert
Springs Villas II Timeshare Association; Douglas at Streamside Condominium
Association;

 

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Eagle Tree Condominium Association, Inc.; Eagle Tree Property Owners
Association, Inc. Evergreen at Streamside Condominium Association; Fairway
Villas at Seaview Condominium Association, Inc.; Frenchman’s Cove Condominium
Owners’ Association, Inc.; Grand Chateau Owners’ Association, Inc.; Grande Ocean
Resort Owners’ Association, Inc.; Grande Vista of Orlando Condominium
Association, Inc.; GRCLT Condominium, Inc.; Great Bay Condominium Owners
Association, Inc.; Harbour Club Owners’ Association, Inc.; HAB Condominium
Association, Inc.; HAO Condominium Association, Inc; Heritage Club Owner’s
Association, Inc.; Highlands Resort Club Association, Inc.; Highlands Resort
Condominium Association, Inc.; Hotel Breckenridge Condominium Association;
Imperial Palm Villas Condominium Association, Inc.; Kalanipu’u Vacation Owners
Association; Ko Olina Beach Club Vacation Owners Association; Lakeshore Reserve
Condominium Association, Inc.; Legends Edge Condominium Association, Inc.; Manor
Club at Ford’s Colony Condominium Association; Manor Club at Ford’s Colony
Time-Share Association; Marriott’s Kauai Beach Club Owners Association; Maui
Ocean Club Vacation Owners Association; Monarch at Sea Pines Owners’
Association, Inc.; Mountain Valley Lodge Resort Owners Association, Inc.;
MountainSide Condominium Association, Inc.; Newport Coast Villas Condominium
Association; Newport Coast Villas Timeshare Association; Newport Coast Villas
Master Association; Oceana Palms Condominium Association, Inc., Ocean Pointe at
Palm Beach Shores Condominium Association, Inc.; OceanWatch Villas Owners
Association; RCC-BG Condominium Association, Inc.; Royal Palms of Orlando
Condominium Association, Inc.; Sabal Palms of Orlando Condominium Association,
Inc.; Shadow Ridge Condominium Association; Shadow Ridge Timeshare Association;
Shadow Ridge Master Association; St. Kitts Beach Club Condominium Association,
Summit Watch Condominium Owners Association, Inc.; Summit Watch Resort Owners
Association, Inc.; Sunset Pointe Owners’ Association, Inc.; SurfWatch Owners
Association; The Neighborhood Association, Inc.; Timber Lodge Condominium
Association; Timber Lodge Timeshare Association; Villas at Doral Condominium
Association, Inc.; Waiohai Beach Club Vacation Owners Association; WDL Vail
Condominium Association, Inc.; WDL Vail Club Association, Inc.; 690 Market Club
Owners Association, Inc.; and 690 Market Master Association, Inc.

“Responsible Officer” shall mean (a) when used with respect to the Indenture
Trustee, any officer assigned to the Corporate Trust Office, including any
Managing Director, Vice President, Assistant Vice President, Secretary,
Assistant Secretary, Assistant Treasurer, any trust officer or any other officer
of the Indenture Trustee customarily performing functions similar to those
performed by any of the above designated officers, and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer’s knowledge of and familiarity with the particular subject;
(b) when used with respect to the Servicer, any officer responsible for the
administration or management of the Servicer’s servicing department; and
(c) with respect to any other Person, the Chairman of the Board, the President,
a Vice President, the Treasurer, the Secretary, an Assistant Secretary, or the
manager of such Person.

“Retained Interest” shall mean a material net economic interest of not less than
5% of the sum of the Loan Balances of the Timeshare Loans as required under and
in accordance with Article 122a of the CRD.

 

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“Right-to-Use Agreement” shall mean with respect to a Right-to-Use Loan,
collectively (A) the various instruments, including a Resort’s articles of
association, a Resort’s timeshare plan, a Resort’s disclosure statement used in
selling Units, any share purchase agreement with an Obligor associated with such
Right-to-Use Loan, that among other things: (i) in consideration of the payment
of a purchase price, including payment of the related Obligor Note, grants and
conveys to the Obligor shares in the related Resort Association, which in turn
grants the Obligor the license or right-to-use and occupy a Timeshare Property
in a Resort, (ii) imposes certain obligations on the Obligor regarding payment
of the related Obligor Note, the Obligor’s use or occupancy of the Timeshare
Property and the payment of a maintenance fee to the management company, and
(iii) grants the holder thereof certain rights, including the rights to payment
of the related Obligor Note, and, in the circumstances provided therein, to
terminate the Right-to-Use Agreement or revoke the Obligor’s rights under it, to
reacquire any shares of the Resort’s association, and thereafter to resell the
license or right-to-use and occupy the related Timeshare Property to another
Person, (B) the related Vacation Interest, and (C) the related Purchase
Contract.

“Right-to-Use Loan” shall mean a Timeshare Loan that is subject to a
Right-to-Use Agreement. As used in the Facility Documents, the term
“Right-to-Use Loan” shall include the related Obligor Note, the Right-to-Use
Agreement and other security documents contained in the related Timeshare Loan
File.

“S&P” shall mean Standard & Poor’s Ratings Services, a Standard & Poor’s
Financial Services LLC business.

“Sale Agreement” shall mean the amended and restated sale agreement, dated as of
September 1, 2012, by and between the Seller and the Issuer pursuant to which
the Seller sells the Timeshare Loans to the Issuer.

“Schedule of Timeshare Loans” shall mean the list of Timeshare Loans attached to
an Additional Timeshare Loan Supplement (in respect of the Purchase Agreement
and Sale Agreement) and a Supplemental Grant (in respect of the Indenture and
Servicing Agreement) in electronic format, as amended from time to time to
reflect repurchases and substitutions pursuant to the terms of the Purchase
Agreement, Sale Agreement and the Indenture and Servicing Agreement, which list
shall set forth the following information with respect to each Timeshare Loan as
of the related Cut-Off Date, in numbered columns:

 

  1 Loan Number

 

  2 Name of Obligor

 

  3 Timeshare Estate Unit(s)/Week(s)/Number(s)/Beneficial Interest Number(s)

 

  4 Interest Rate Per Annum

 

  5 FICO score

 

  6 State of Residence

 

  7 Country of Residence

 

  8 Date of Origination

 

  9 Original Loan Balance

 

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  10 Maturity Date

 

  11 Monthly Payment Amount

 

  12 Original Term (in months)

 

  13 Outstanding Loan Balance

 

  14 Refinance

 

  15 Right-to-Use Timeshare Estate

 

  16 Pre-Completion Loan and Anticipated Completion Date

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Securitization Take-Out Date” shall mean the date of any Securitization
Take-Out Transaction.

“Securitization Take-Out Transaction” shall mean any securitization or other
financing of the assets securing the Notes whereby all or a portion of the
Outstanding Note Balance of the Notes is repaid from the proceeds of such
securitization or other financing.

“Securitized Portfolio” shall mean, as of any date, all timeshare loans
originated by MORI or an Affiliate and financed by any special purpose entity
and which are serviced by MORI including the timeshare loans in all term
issuances, all warehouse facilities (other than the Notes) and other term
securitization facilities that are outstanding as of such date.

“Securitized Portfolio Default Level” shall mean, for any Due Period, the
quotient (expressed as a percentage) of (i)(A) the sum of the Loan Balances of
all Timeshare Loans in the Securitized Portfolio that became Defaulted Timeshare
Loans during such Due Period (other than Defaulted Timeshare Loans for which the
related seller has exercised its option, if any, to repurchase or substitute
pursuant to the related transaction documents) minus (B) any remarketing
proceeds received during such Due Period in respect of any Defaulted Timeshare
Loans for which the related seller did not exercise its option to repurchase or
substitute, divided by (ii) the aggregate Loan Balance of all Timeshare Loans in
the Securitized Portfolio on the first day of such Due Period.

“Securitized Portfolio Delinquency Level” shall mean, for any Due Period, the
quotient (expressed as a percentage) of the sum of all Loan Balances of all
Timeshare Loans (exclusive of Timeshare Loans that became Defaulted Timeshare
Loans on or before the last day of such Due Period) included in the Securitized
Portfolio that are 61 days or more delinquent on the last day of such Due Period
(as determined by the Servicer in accordance with the Servicing Standard)
divided by the aggregate Loan Balance of all Timeshare Loans in the Securitized
Portfolio on the last day of such Due Period.

“Securitized Portfolio Three Month Rolling Average Default Percentage” means for
any Payment Date, the average of the Securitized Portfolio Default Levels for
the last three Due Periods.

“Securitized Portfolio Three Month Rolling Average Delinquency Percentage” means
for any Payment Date, the average of the Securitized Portfolio Delinquency
Levels for the last three Due Periods.

 

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“Seller” shall mean MORI SPC Series Corp., a Delaware corporation.

“Servicing Fee” shall mean for any Payment Date, the product of one-twelfth of
0.50% and the Aggregate Loan Balance as of the beginning of the related Due
Period or, with respect to any subsequent servicer, as otherwise determined
pursuant to Section 5.04 of the Indenture and Servicing Agreement.

“Servicer” shall mean MORI, and any successor servicer appointed in accordance
with the terms of the Indenture and Servicing Agreement.

“Servicer Event of Default” shall have the meaning specified in Section 5.04 of
the Indenture and Servicing Agreement.

“Servicer Representative” shall mean the Servicer’s internal auditors, chief
financial officer, treasurer or designee of the chief financial officer or
treasurer.

“Servicing Officer” shall mean those officers of the Servicer involved in, or
responsible for, the administration and servicing of the Timeshare Loans, as
identified on the list of Servicing Officers furnished by the Servicer to the
Indenture Trustee and the Noteholders from time to time.

“Servicing Standard” shall have the meaning specified in Section 5.01 of the
Indenture and Servicing Agreement.

“St. Kitts Mortgage Loan” shall mean a Mortgage Loan originated in connection
with purchases of interests at St. Kitts Beach Club.

“Standard Definitions” shall mean these Second Amended and Restated Standard
Definitions.

“Stated Maturity” shall mean the Payment Date occurring in September 2035.

“Statutory Trust Statute” shall mean Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. § 3801, et seq., as the same may be amended from time to time.

“Step-Up CP Interest” shall mean, for any Interest Accrual Period with respect
to any Purchaser Group, the excess of (i) the amount calculated for such
Interest Accrual Period pursuant to subclause (a) of clause (x) of the
definition of Carrying Costs with respect to such Purchaser Group over (ii) an
amount equal to the product of (x) the average daily amount during such Interest
Accrual Period of the portion of the Purchaser Invested Amount for such
Purchaser Group funded by the Conduit with respect to such Purchaser Group,
(y) a rate equal to the LIBOR Rate for the related Funding Period plus 1.00% and
(z) the number of days in such Interest Accrual Period divided by 360.

“Structuring Agent” means Deutsche Bank Securities Inc.

“Structuring Fee” shall have the meaning set forth in the Fee Letter.

 

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“Structuring Renewal Fee” shall have the meaning set forth in the Renewal Fee
Letter.

“Subsidiary” shall mean any corporation or other entity of which securities or
other ownership interests having ordinary voting power to elect a majority of
the board of directors or other Persons performing similar functions are at the
time directly or indirectly owned or controlled by such Person, one or more of
the other subsidiaries of such Person or any combination thereof.

“Substitution Shortfall Amount” shall mean with respect to a substitution
pursuant to Section 4.06 of the Indenture and Servicing Agreement, an amount
equal to the excess, if any, of (a) the Loan Balance of the Timeshare Loan being
replaced as of the related Transfer Date, together with all accrued and unpaid
interest on such Timeshare Loan at the related coupon rate to but not including
the due date in the related Due Period over (b) the Loan Balance of the
Qualified Substitute Timeshare Loan as of the related Transfer Date. If on any
Transfer Date, one or more Qualified Substitute Timeshare Loans are substituted
for one or more Timeshare Loans, the Substitution Shortfall Amount shall be
determined as provided in the preceding sentence on an aggregate basis.

“Successor Servicer” shall mean the Back-Up Servicer and its permitted
successors and assigns, as provided in the Indenture and Servicing Agreement,
upon succeeding to the responsibilities and obligations of the Servicer in
accordance with Section 5.19 of the Indenture and Servicing Agreement.

“Supplemental Grant” shall mean with respect to any Additional Timeshare Loans
and other related assets pledged to the Indenture Trustee pursuant to the
Indenture, a Supplemental Grant substantially in the form attached as Exhibit C
of the Indenture. The Supplemental Grant shall include a Schedule of Timeshare
Loans for the related Additional Timeshare Loans and an updated Schedule of
Timeshare Loans for all Borrowing Base Loans.

“Tape(s)” shall have the meaning specified in Section 5.19 of the Indenture and
Servicing Agreement.

“Taxes” shall have the meaning set forth in Section 4.3 of the Note Purchase
Agreement.

“Timeshare Loan” shall mean a Mortgage Loan, a Right-to-Use Loan or a Qualified
Substitute Timeshare Loan subject to the lien of the Indenture and Servicing
Agreement.

“Timeshare Loan Acquisition Price” shall mean on any date of determination, with
respect to any Timeshare Loan, an amount equal to the fair market value of such
Timeshare Loan as determined by MORI under the Purchase Agreement and by the
Seller under the Sale Agreement, as applicable.

 

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“Timeshare Loan Files” shall mean with respect to each Timeshare Loan and each
Obligor:

(a) an original Obligor Note (or a Lost Note Affidavit and indemnity from the
Seller with a copy of such Obligor Note attached thereto), executed by the
Obligor, endorsed in the form “Pay to the order of                         ,
without recourse” (either directly on the Obligor Note or on an allonge
thereto), by an Authorized Officer of the Seller showing a complete chain of
endorsements from the original payee of the Obligor Note to the Seller;

(b) (x) if such Timeshare Loan is a Mortgage Loan (other than a St. Kitts
Mortgage Loan), (i) an original Mortgage (or a copy thereof) with evidence that
such Mortgage has been recorded in the appropriate recording office or
(ii) until the original Mortgage has been returned to the originator of the
Mortgage Loan by such recording office, a photocopy of an unrecorded Mortgage
that has been delivered to such recording office, and the delivery of such copy
of an original Mortgage or photocopy of an unrecorded Mortgage to the Custodian
by the Issuer or the Servicer shall be deemed to be a certification by the
Issuer that such copy or photocopy is a true and correct copy of the original
Mortgage, or (y) if such Timeshare Loan is a St. Kitts Mortgage Loan, a copy of
the recorded or stamped Mortgage;

(c) (x) if such Timeshare Loan is a Mortgage Loan (other than a St. Kitts
Mortgage Loan), original assignments of the Mortgage (which may be a part of a
blanket assignment of more than one Timeshare Loan), from the originator of the
Mortgage Loan to the Indenture Trustee in recordable form but unrecorded, signed
by an Authorized Officer of the originator of the Mortgage Loan or (y) if such
Timeshare Loan is a St. Kitts Mortgage Loan, copies of the recorded assignments
of the Mortgage from the originator of the St. Kitts Mortgage Loan to the
Issuer;

(d) if such Timeshare Loan is a St. Kitts Mortgage Loan, (i) an original
certificate of title (or a copy thereof) with evidence that such certificate of
title has been stamped by the office of the Registrar of Titles of the Island of
Saint Christopher in favor of the Indenture Trustee or (ii) until the original
certificate of title has been returned to the Custodian or Servicer by such
office, a photocopy of the certificate of title that has been delivered to such
office, and the delivery of such copy of the original certificate of title to
the Custodian by the Issuer or the Servicer shall be deemed to be a
certification by the Issuer that such copy or photocopy is a true and correct
copy of the original certificate of title;

(e) if such Timeshare Loan is a Mortgage Loan, an original lender’s title
insurance policy or master policy (or a copy thereof) referencing such Mortgage
Loan, when available, and if a copy, the delivery thereof to the Custodian by
the Issuer shall be deemed to be a certification by the Issuer that such copy is
a true an correct copy of such lender’s title insurance policy or master policy;

(f) an original or a copy of each guarantee, assumption, modification or
substitution agreement, if any, which relates to the Timeshare Loan (including
but not limited to the Obligor Note, Mortgage, Right-to-Use Agreement, as
applicable), and if a copy, the delivery thereof to the Custodian by the Issuer
or the Servicer shall be deemed to be a certification by the Issuer that such
copy is a true and correct copy of such guarantee assumption, modification or
substitution agreement;

 

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(g) if such Timeshare Loan is a Right-to Use Loan, the original related
Right-to-Use Agreement and any related pledge and security agreements (or copies
thereof), and if copies, the delivery thereof to the Custodian by the Issuer or
the Servicer shall be deemed to be a certification by the Issuer that such
copies are true and correct copies of such Right-to-Use Agreement and related
pledge and security agreements, provided, however, that each Timeshare Loan File
shall not include any documents attached to or delivered to an Obligor with a
Right-to-Use Agreement that are not signed by the parties to the Right-to-Use
Agreement and are delivered in identical form to all Obligors (such as articles
of association, a timeshare plan and a public disclosure statement) if copies of
such documents have been delivered to the Custodian by the Issuer or the
Servicer, and such delivery to the Custodian shall be deemed to be a
certification by the Issuer that such copies are true and complete copies of
such documents;

(h) if such Timeshare Loan is a Right-to Use Loan, a copy of the related
Vacation Interest representing membership in the related timeshare association
of the related Resort;

(i) an original fully executed Purchase Contract (or a copy thereof), and if a
copy, the delivery thereof to the Custodian by the Issuer or the Servicer shall
be deemed to be a certification by the Issuer that such copy is a true and
correct copy of such Purchase Contract, unless (i) the Timeshare Loan File
represents the refinancing of a timeshare loan, in which event no related
Purchase Contract shall be included or (ii) a complete Purchase Contract is not
available, in which event such portions as are available shall be included in
the Timeshare Loan File and the delivery of any portions of a Purchase Contract
to the Custodian by the Issuer or the Servicer shall be deemed to be a
certification by the Issuer that such portions constitute the only portions that
are available; and

(j) all other documents related to such Timeshare Loan including any Trailing
Documents immediately upon receipt by the Trustee.

“Timeshare Loan Servicing Files” shall mean, with respect to each Timeshare Loan
and each Obligor a copy of the Timeshare Loan Files and all other papers and
computerized records customarily maintained by the Servicer in servicing
timeshare loans comparable to the Timeshare Loans.

“Timeshare Loan Update Memo” shall mean any memorandum executed by an authorized
representative of Servicer and delivered to Custodian from time to time that
provides additional or modified information in respect of any Timeshare Loan or
Timeshare Loan File.

“Timeshare Property” shall mean Weeks-Based Timeshare Property or Beneficial
Interests, as the case may be, and the rights granted thereunder to the Issuer
(as assignee of the originator of such loan), which secure a Timeshare Loan.

“Trailing Document” shall mean any additional documentation related to a
Timeshare Loan or supplemental to a Timeshare Loan File delivered to the
Custodian following its initial receipt of the relevant Timeshare Loan File and
immediately incorporated into such relevant Timeshare Loan File by the Custodian
upon receipt.

 

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“Transfer Date” shall mean with respect to a Qualified Substitute Timeshare
Loan, the date on which the Issuer acquires such Qualified Substitute Timeshare
Loan from the Seller and Grants such Qualified Substitute Timeshare Loan to the
Indenture Trustee to be included as part of the Trust Estate.

“Transition Expenses” shall mean any documented costs and expenses (other than
general overhead expenses) incurred by the Back-Up Servicer should it become the
Successor Servicer as a direct consequence of the termination or resignation of
the initial Servicer and the transition of the duties and obligations of the
initial Servicer to the Successor Servicer.

“Trust Accounts” shall mean collectively, the Collection Account, the Reserve
Account, the Control Accounts, the Hedge Collateral Account and such other
accounts established by the Indenture Trustee pursuant to Section 3.01(a) of the
Indenture and Servicing Agreement.

“Trust Agreement” shall mean that certain amended and restated trust agreement,
dated the Closing Date, by and between the Owner and the Owner Trustee.

“Trust-Based Timeshare Loan” shall mean a Timeshare Loan secured by a Beneficial
Interest.

“Trust Estate” shall have the meaning specified in the Granting Clause of the
Indenture and Servicing Agreement.

“UCC” means, with respect to any jurisdiction, the uniform commercial code then
in effect in such jurisdiction.

“Unit” shall mean a residential unit or dwelling at a Resort.

“Unused Fees” shall mean with respect to any Purchaser Group or any Non-Conduit
Committed Purchaser, the product of:

(i) the Unused Rate; and

(ii) the excess of (x) its average daily Purchaser Commitment Amount during the
related Interest Accrual Period over (y) its average daily Purchaser Invested
Amount during the related Interest Accrual Period; and

(iii) the number of days in such Interest Accrual Period, divided by 360.

“Unused Rate” means 0.65%.

“Up-Front Fees” shall have the meaning specified in the Fee Letter.

“Up-Front Renewal Fees” shall have the meaning specified in the Renewal Fee
Letter.

“Upgrade” means, with respect to a Timeshare Loan, a situation in which an
Obligor elects to upgrade the related Timeshare Property or to purchase
additional Timeshare Properties and enters into a new timeshare loan secured by
the upgraded Timeshare Property or the original Timeshare Property and the
additional Timeshare Properties.

 

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“Usage Fees” shall mean shall mean with respect to any Purchaser Group or any
Non-Conduit Committed Purchaser, the product of:

(i) the Usage Rate; and

(ii) its average daily Purchaser Invested Amount during the related Interest
Accrual Period; and

(iii) the number of days in such Interest Accrual Period, divided by 360.

“Usage Rate” means 1.50%.

“Usage Step-Up Fees” means with respect to any Purchaser Group or any
Non-Conduit Committed Purchaser, the product of:

(i) the Usage Step-Up Rate;

(ii) its average daily Purchaser Invested Amount during the related Interest
Accrual Period; and

(iii) the number of days in such Interest Accrual Period, divided by 360.

“Usage Step-Up Rate” means (i) upon the earlier of the occurrence of an
Amortization Event or the Facility Termination Date until an Event of Default
has occurred and is continuing, 1.50% or (ii) if an Event of Default has
occurred and is continuing, 2.00%.

“USAP” shall have the meaning specified in Section 5.05(c) of the Indenture and
Servicing Agreement.

“Vacation Interest” shall mean the vacation certificate or stock certificate
issued by and evidencing membership in a homeowner’s association of a Resort
pursuant to which the owner thereof has a license or right-to-use a Timeshare
Property at a Resort.

“Vacation Ownership Business” means the development, sale, management,
marketing, operation or financing of (1) timeshare, fractional, interval,
vacation club, destination club, vacation membership, private membership club,
private residence club, points club, and other forms of products, programs and
services wherein purchasers acquire an ownership interest, use right or other
entitlement to use one or more of certain determinable accommodations and
associated facilities in a system of units and facilities on a recurring,
periodic basis and pay for such ownership interest, use right or other
entitlement in advance (whether payments are made in lump-sum or periodically
over time), and (2) associated exchange programs.

“Warehouse Portfolio” shall mean, as any date of determination, all Timeshare
Loans owned by the Issuer.

 

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“Warehouse Portfolio Default Level” shall mean, for any Due Period, the quotient
(expressed as a percentage) of (i)(A) the sum of the Loan Balances of all
Timeshare Loans in the Warehouse Portfolio that became Defaulted Timeshare Loans
during such Due Period (other than Defaulted Timeshare Loans for which the
Seller has exercised its option to repurchase or substitute pursuant to
Section 6(b) of the Sale Agreement) minus (B) any remarketing proceeds received
during such Due Period in respect of any Defaulted Timeshare Loans for which the
Seller did not exercise its option to repurchase or substitute, divided by
(ii) the Aggregate Loan Balance on the first day of such Due Period.

“Warehouse Portfolio Delinquency Level” shall mean, for any Due Period, the
quotient (expressed as a percentage) of the sum of all Loan Balances of all
Timeshare Loans (exclusive of Timeshare Loans that became Defaulted Timeshare
Loans on or before the last day of such Due Period) included in the Warehouse
Portfolio that are 61 days or more delinquent on the last day of such Due Period
(as determined by the Servicer in accordance with the Servicing Standard)
divided by the Aggregate Loan Balance on the last day of such Due Period.

“Warehouse Portfolio Three Month Rolling Average Default Percentage” means for
any Payment Date, the average of the Warehouse Portfolio Default Levels for the
last three Due Periods.

“Warehouse Portfolio Three Month Rolling Average Delinquency Percentage” means
for any Payment Date, the average of the Warehouse Portfolio Delinquency Levels
for the last three Due Periods.

“Weeks-Based Timeshare Loan” shall mean a Timeshare Loan secured by a
Weeks-Based Timeshare Property.

“Weeks-Based Timeshare Property” shall mean the contractual rights regarding a
Unit that is the subject of a Right-to-Use Agreement, or the timeshare fee or
other estate regarding a Unit.

 

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