Document:

Exhibit

Exhibit 10.5

SECOND AMENDMENT TO
AMENDED AND RESTATED LOAN SALE AND SERVICING AGREEMENT

THIS SECOND AMENDMENT TO AMENDED AND RESTATED LOAN SALE AND SERVICING AGREEMENT (this “Second Amendment”), dated as of June 10, 2016 (the “Effective Date”), is entered into by and among DRI Quorum 2010 LLC, a Delaware limited liability company, as Seller (the “Seller”), Quorum Federal Credit Union, a federally chartered credit union, as Buyer (the “Buyer”), Diamond Resorts Financial Services, Inc., a Nevada corporation,  as  Servicer  (the  “Servicer”),  and  Wells  Fargo  Bank,  National  Association,  a national banking association, as Back-Up Servicer (the “Back-Up Servicer”).

RECITALS

WHEREAS, the Buyer and the Seller have previously entered into that certain Amended and Restated Loan Sale and Servicing Agreement, dated as of December 31, 2012, as amended by that certain First Amendment to Amended and Restated Loan Sale and Servicing Agreement, dated as of September 30, 2015 (as may be amended, supplemented or restated from time to time, the “Amended and Restated Loan Sale and Servicing Agreement”).

WHEREAS, the parties hereto desire to modify the Amended and Restated Loan Sale and Servicing Agreement as set forth in this Second Amendment.

WHEREAS, capitalized terms used herein not otherwise defined herein shall have the meanings ascribed to such terms in the Amended and Restated Loan Sale and Servicing Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:

1.(a)    Section 1 to the Amended and Restated Loan Sale and Servicing Agreement is hereby amended to substitute and add, as applicable, the following defined terms, in the appropriate alpha order:

“Agreement” has the meaning set forth in the preamble to this Agreement, as the same may be amended from time to time.

“Sale Date” has  the  meaning  set  forth  in  Section  3(a)  of  the  Amended  and
Restated Loan Sale and Servicing Agreement.

(b)    The defined terms “Expiration of Rescission Period,” “Pre-Funding Conditions,” and “Settlement and Funding Notice” and the definitions ascribed thereto are hereby deleted from Section 1 of the Agreement.

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 1

2.Sections 3(a), 3(b) and 3(c) of the Amended and Restated Loan Sale and Servicing Agreement are hereby deleted in their entirety and replaced with the following:

(a)     General Process.  During the Purchase Period, and subject to the terms and conditions of this Agreement, the Seller shall give the Buyer prior written notice in substantially the form of Exhibit E hereto (a “Sale Notice”) not later than 2:00 p.m. (New York City time) on the date which is no less than three (3) Business Days prior to the date of a proposed Sale (each such sale date, a “Sale Date”) or during the Start-up Period five (5) Business Days prior to the date of a proposed Sale. Such Sale Notice shall specify (i) the principal amount of the Timeshare Loans and (ii) the proposed Sale Date, which must be a Business Day. The Buyer may act without liability upon the basis of written notice believed by the Buyer in good faith to be from the Seller (or from any Authorized Officer thereof designated in writing by the Seller to the Buyer). The Buyer shall be entitled to rely conclusively on any Authorized Officer's authority to request a sale on behalf of the Seller until the Buyer receives written notice to the contrary. The Buyer shall have no duty to verify the authenticity of the signature appearing on any written Sale Notice.

(b)     Commitment Period.  During the Commitment Period, the Buyer shall be obligated to purchase Eligible Timeshare Loans from the Seller such that the Buyer’s Net Investment Amount never exceeds the Minimum Committed Amount subject only to (i) the Seller offering through a Sale Notice to the Buyer Eligible Timeshare Loans with aggregate Loan Balances in a sufficient amount during the Commitment Period not to exceed the Minimum Committed Amount, (ii) the monthly and annual limitations set forth in section 3(l), and (iii) there being no occurrence and continuance of an Event of Default or a Timeshare Portfolio Performance Event. The Buyer shall issue a commitment purchase confirmation with such terms as are contained in the form of Exhibit F-1 attached hereto and incorporated herein by this reference, together with such percentage rates, fees and default levels as shall be agreed to by the Buyer and Seller as of the Effective Date (a “Buyer Commitment Purchase Confirmation”) by 5:00 p.m. (New York City time) on the third (3rd) Business Day from the date of the aforesaid delivery of the list of Timeshare Loans ready for funding. The Buyer Commitment Purchase Confirmation shall note any Timeshare Loans that do not constitute an Eligible Timeshare Loan and shall establish a Sale Date no later than two (2) Business Days from the date of the Buyer Commitment Purchase Confirmation.  The Buyer shall deposit the Initial Purchase Price Installment in immediately available funds, no later than 12:00 p.m. (New York City time) on the related Sale Date, to the account designated by the Seller.

Notwithstanding the foregoing, the obligation of the Buyer to purchase Eligible Timeshare Loans during the Commitment Period as set forth in this Section 3(b) is subject to applicable laws, regulations and guidelines or directives of the National Credit Union Association (“NCUA”), as modified from time to time (“NCUA Regulations”); provided, however, that the Buyer (i) represents and warrants to the Seller that, as of the Closing Date, there are no NCUA Regulations that in any way 

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 2

affect or limit the Buyer’s obligation to purchase Eligible Timeshare Loans pursuant to this Section 3(b) or any related Conveyed Timeshare Property from the Seller and (ii) covenants and agrees to deliver written notice to the Seller not less than ninety (90) days prior to the effectiveness of any NCUA Regulations that could reasonably be expected to affect or limit the Buyer’s obligation to purchase Eligible Timeshare Loans pursuant to this Section 3(b) or any related Conveyed Timeshare Property from the Seller.

(c)    After the Commitment Period. If the Seller delivers a Sale Notice to the Buyer and if the Buyer intends to enter into such Sale with the Seller, then the Buyer shall confirm, by issuing a purchase confirmation specifying the related business terms in substantially the form in Exhibit F-2 attached hereto (a “Buyer Purchase Confirmation”) no later than 12:00 p.m. (New York City time) on the Business Day prior to the proposed Sale Date that the Buyer shall fund in accordance with the Sale Notice. The Seller may reject such Buyer Purchase Confirmation by noting such rejection thereon and delivering the same to the Buyer no later than 5:00 p.m. (New York City time) on the Business Day prior to the proposed Sale Date. The Buyer Purchase Confirmation shall specify items including the following (w) the Buyer Purchase Price Percentage, (x) the Initial Purchase Price Installment for such Sale Date Loan Pool, (y) the Program Fee Rate, and (z) any fees and expenses payable by the Seller to the Buyer. The Buyer shall deposit the Initial Purchase Price Installment in immediately available funds, no later than 12:00 p.m. (New York City time) on the related Sale Date, to the account designated by the Seller in the Sale Notice.

3.Subparagraph (p) of Schedule I is deleted in its entirety and replaced with the following:

(p)    the Timeshare Loan was originated, processed, underwritten and closed for sale by the Originator in the normal course of its business and, unless otherwise waived by the Buyer, as at the Sale Date such Timeshare Loan shall not have passed the date that is 69 days after the expiration of the statutory rescission period applicable to such loan; and to Seller's Knowledge, the origination, servicing and collection practices used by Seller or its Affiliates with respect to the Timeshare Loan have been in all respects, legal, proper, prudent and customary;

4.The Sale Notice attached hereto replaces the Sale Notice appearing as Exhibit E to the Amended and Restated Loan Sale and Servicing Agreement.

5.The contents of Exhibit K are hereby deleted in their entirety and replaced with the words “Deliberately Omitted.”

6.Except as specifically set forth herein, this Second Amendment shall not modify, alter, change, or affect any of the other terms or conditions of the Amended and Restated Loan Sale and Servicing Agreement.

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 3

(Signature Page Follows)

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 4

IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment as of the date set forth above.

	
		
	THE BUYER:
	QUORUM FEDERAL CREDIT UNION

By:           /s/   Bruno Sementilli                  
Name:  Bruno Sementilli, Title:   President and CEO

	

THE SELLER:
	

DRI QUORUM 2010 LLC

By:          /s/   Lillian Luu                            
Name:  Lillian Luu
Title:   Treasurer

	

THE SERVICER:
	

DIAMOND RESORTS FINANCIAL SERVICES, INC.

By:          /s/   Lillian Luu                            
Name:  Lillian Luu
Title:   Treasurer

	

THE BACK-UP SERVICER:
	

WELLS FARGO BANK, N.A.

By:        /s/   Sue Larson                               
Name:   Sue Larson
Title:   Vice President

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 5

EXHIBIT E SALE NOTICE

Date:      

This Sale Notice is pursuant to the Amended and Restated Loan Sale and Servicing Agreement, dated as of December 31, 2012, by and among DRI Quorum 2010 LLC, a Delaware limited liability company, as Seller, Quorum  Federal  Credit  Union,  a  federally  chartered  credit  union,  as  Buyer,  Diamond  Resorts  Financial Services, Inc., a Nevada corporation, as Servicer, and Wells Fargo Bank, National Association, a national banking association, as Back-Up Servicer, as amended by that First Amendment to Amended and Restated Loan Sale and Servicing Agreement, dated as of September 23, 2015 (as may be amended, supplemented or restated from time to time, the “Amended and Restated Loan Sale and Servicing Agreement”). Capitalized terms not otherwise defined herein shall have the meaning ascribed thereto in the Agreement. The Seller proposes to sell to the Buyer the Timeshare Loans described below:

    
	
		
	Proposed Sale Date:

	 

	Aggregate principal balance of Sale Date Loan Pool:

	$                                      

	Number of Timeshare Loans in Sale Date Loan Pool:

	 

	Range of balances of Timeshare Loans:

	$                             to  $                             

	Range of seasoning of Timeshare Loans:

	             months to                   months

	Aggregate balance, shown as a percentage, of Timeshare Loans in the Sale Date Loan Pool to non-U.S. domiciled Borrowers:

	                        %

	Aggregate balance, shown as a percentage, of Timeshare Loans in the Sale Date Loan Pool secured by a right-to-use vacation ownership interest with a finite use:  

	                        %

	Aggregate balance, shown as a percentage, of Timeshare Loans in the Sale Date Loan Pool secured by a vacation ownership interest that limits use to less frequently than each year:

	                        %

	Aggregate balance, shown as a percentage, of Timeshare Loans in the Sale Date Loan Pool that are Eligible In-Transit Loans:

	                        %

	Sale Date Loan Pool Number:

	 

An electronic file detailing each Timeshare Loan is hereby delivered to the Buyer with this Sale Notice.

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 5

Unless a Buyer's purchase confirmation is received by the Seller before 12 pm one (1) business day prior to the Sale Date, this offer of sale shall expire; provided, however, that during the Commitment Purchase Period, the Buyer, pursuant to Section 3.1(b) of the Agreement, shall deliver the Buyer Commitment Purchase Confirmation to the Seller by such date and time.

[Signature on Following Page]

Quorum-Diamond – 2nd Amendment to Amended & Restated LSSA    Page 6

DRI QUORUM 2010 LLC

	
		
	By:
	    

	Name:
	    

	Title:
	    

	Address:
	    

	Attention:
	    

	Telephone:
	    

	Facsimile:Exhibit

Exhibit 10.6

Diamond Resorts International, Inc.
10600 West Charleston Boulevard
Las Vegas, Nevada 89135
August 4th, 2016

Stephen J. Cloobeck
10600 West Charleston Boulevard
Las Vegas, Nevada 89135

Re:     Aircraft Use 
Reference is hereby made to that certain Master Agreement, dated as of January 6, 2015 (the “Master Agreement”), by and among Diamond Resorts International, Inc., a Delaware corporation (“DRII”), Diamond Resorts Corporation, a Maryland corporation (“DRC”; together with DRII, the “DRII Parties”), Hospitality Management and Consulting Service, L.L.C., a Nevada limited liability company, Stephen J. Cloobeck, individually (“SJC”), Cloobeck Companies, LLC, a Nevada limited liability company (“Cloobeck Companies”), JHJM Nevada I, LLC, a Nevada limited liability company formerly known as Diamond Resorts, LLC (“JHJM”; JHJM and Cloobeck Companies being referred to herein, collectively, as the “SJC Entities”; and SJC and the SJC Entities being referred to herein as the “SJC Parties”), and, solely for purposes of Sections 1(a)(ii), 1(b) and 10 thereof, Nevada Resort Properties Polo Towers Limited Partnership, a Nevada limited partnership.  Capitalized terms used, but not otherwise defined, herein shall have the meanings ascribed to them in the Master Agreement.
The Parties desire to enter into this letter agreement to memorialize the Parties’ understanding regarding SJC’s rights with respect to the Initial Flight Hours (as defined below) in connection with SJC’s use, as contemplated by the Master Agreement, of the following aircraft owned or leased by the DRII Parties:  (i) one Bombardier Global Express XRS aircraft, bearing manufacturer’s serial number 9184 and registration number N702DR (“N702DR”), (ii) one Cessna Citation XLS aircraft, bearing manufacturer’s serial number 560-5774 and registration number N828DR (“N828DR”), and (iii) one Embraer Legacy aircraft bearing manufacturer’s serial number 14500925 and registration number N189DR (“N189DR”, together with N702DR and N828DR, collectively, the “Diamond Aircraft”), as more specifically set forth herein.
1.Agreement.  Each of the DRII Parties hereby agrees that, notwithstanding anything set forth in the Master Agreement or in any other agreement between either of the DRII Parties, on the one hand, and any of the SJC Parties, on the other hand, during the period commencing with May 24, 2016 and ending on the earlier of (i) December 31, 2016 and (ii) the closing of the acquisition of DRII by affiliates of Apollo Global Management, LLC., neither DRII Party shall charge SJC for the first aggregate of fifty (50) Personal Use Hours (defined below) used by SJC on any Diamond Aircraft (the “Initial Flight Hours”).  Personal Use Hours may be used on any flight on a Diamond Aircraft requested by SJC for personal use, whether or not the flight is operated by DRC pursuant to a time sharing agreement between DRC and SJC.  If such flight is operated pursuant to a time sharing agreement, then DRC shall have no obligation to issue an invoice for any of the Initial Flight Hours pursuant thereto.  Notwithstanding anything contained herein to the contrary, the charter 

flights provided by AvJet to SJC between July 13, 2016 and July 15, 2016 shall be deducted from the Initial Flight Hours, reducing the Initial Flight Hours by 8.3 Flight Hours.  
For purposes hereof, the following terms shall have the following meanings:
“Personal Use Hours” means, and shall be calculated based upon, (i) any Flight Hours used on N702DR, (ii) any Flight Hours used on N828DR multiplied by 0.46, and (iii) any Flight Hours used on N189DR multiplied by 0.67. 
“Flight Hour” means each flight hour of use of a Diamond Aircraft by SJC, as recorded on the hour meter and measured from the time such aircraft wheel blocks are removed at the beginning of a flight, to the time such aircraft wheel blocks are replaced after landing at the end of a flight, in one-tenth (1/10th) of an hour increments.  Flight Hours also include any flight hours consumed in repositioning the relevant Diamond Aircraft to facilitate SJC’s scheduled itineraries.  Each of the Parties hereby agrees that this letter agreement supersedes (and shall not be in addition to) all other prior oral or written agreements, understandings, arrangements or representations by or among the Parties, or between any of them with respect to the matters set forth in this letter agreement.
2.Representations and Warranties.  Each of the Parties represents and warrants that it has duly authorized, executed and delivered this letter agreement, no further consent or authorization is required by such Party, and this letter agreement constitutes a valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies.
This letter agreement shall be binding upon and shall inure to the benefit of the Parties and their permitted successors and assigns.  This letter agreement may be signed in any number of counterparts with the same effect as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this letter agreement. Delivery of an executed counterpart of a signature page to this letter agreement by facsimile or email transmission shall be effective as delivery of a manually executed counterpart thereof.  This letter agreement shall be governed by, and construed in accordance with, Nevada law.  
[Signatures Follow]

2

Sincerely,
DIAMOND RESORTS INTERNATIONAL, INC. 
 
 
By: /s/ Jared Finkelstein             
Name:  Jared Finkelstein 
Title:    SVP General Counsel

DIAMOND RESORTS CORPORATION 
 
 
By: /s/ Jared Finkelstein             
Name:  Jared Finkelstein 
Title:    SVP General Counsel

[Signature Page to Letter Agreement]

Acknowledged and accepted this 4th day of August, 2016:
s/ Stephen J. Cloobeck             
Stephen J. Cloobeck

Jhjm Nevada LLC

[Signature Page to Letter Agreement]

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