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EXHIBIT 10.2
CROSS INDEMNITY AGREEMENT
THIS CROSS INDEMNITY AGREEMENT (this "AGREEMENT"), is made and entered
into as of the 18th day of August, 1997 by BANCOMER, S.A., INSTITUCION DE BANCA
MULTIPLE, GRUPO FINANCIERO ("BANCOMER") in favor of the Benefited Parties (as
hereinafter defined), and by C.R. RESORTS CANCUN, S. DE X.X. DE C.V. ("RAINTREE
CANCUN") and C.R. RESORTS PUERTO VALLARTA, S. DE X.X. DE C.V. ("RAINTREE PUERTO
VALLARTA") in favor of Bancomer.
RECITALS
A. Any capitalized terms used in the following Recitals and not
defined therein are defined in the body of this Agreement.
B. Prior to the consummation of the Transaction (i) PRODEPA was
the primary beneficiary of the PRODEPA Trust which held title to certain real
property in Xxxxxx Xxxxxxxx, Xxxxxxx, Xxxxxx and the improvements thereon,
which consist of an international luxury resort hotel currently known as the
Xxxxxx Xxxxxx Puerto Vallarta (the "PUERTO VALLARTA HOTEL") and a vacation
ownership interval facilities consisting of 205 timeshare units (the "PUERTO
VALLARTA TIMESHARE OPERATION"), and (ii) NIZUC was the primary beneficiary of
the NIZUC Trust which held title to certain real property in Cancun, Xxxxxxxx
Roo, Mexico and the improvements thereon, which consist of an international
luxury resort hotel currently known as the Xxxxxx Xxxxxx Cancun (the "CANCUN
HOTEL") and a vacation ownership interval facilities consisting of 69 timeshare
units (the "CANCUN TIMESHARE OPERATION").
C. The Trust Agreements provided for the division of the
beneficial ownership interests in the above- described properties into "A"
beneficial rights, generally consisting of the right to use, occupy and enjoy
the timeshare suites for a period of time together with the right to use
certain amenities and common areas (the ""A" RIGHTS"), and "B" beneficial
rights, consisting of all other rights with respect to the real properties and
the improvements thereon as set forth in the Trust Agreements (the ""B"
RIGHTS"). PRODEPA held the "B" Rights in the PRODEPA Trust and NIZUC held the
"B" Rights in the NIZUC Trust.
D. The Trust Agreements originally contemplated that all
timeshare suites would ultimately be encumbered by the "A" Rights on a
sequential basis as follows: PRODEPA or NIZUC would assign the "A" Rights to
VDC, and subsequently VDC would assign those "A" Rights to VOC in exchange for
memberships in VOC, which VDC would sell to Mexican and foreign entities and
individuals. VDC did not transfer "A" Rights to any party other than VOC. All
memberships in VOC which were not sold by VDC, and all memberships in VOC which
were recovered by VDC from, or returned to VDC by, purchasers have been
transferred by VDC to PRODEPA. The Amended PRODEPA Trust accurately reflects
the number and identity of timeshare suites within the Puerto Vallarta
Timeshare Unit which are subject to "A" Rights, and the Amended NIZUC Trust
accurately
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reflects the number and identity of timeshare suites (or units) within the
Cancun Timeshare Unit which are subject to "A" Rights.
E. Prior to the amendment of the Trust Agreements, each of the
Trust Agreements contained certain restrictions and prohibitions which would
have prevented, among other things, the transfer of title to any portion of the
real property which was the subject thereof and the consummation of the
Transaction.
F. Bancomer, as Trustee of the PRODEPA Trust, acting on the
instructions of PRODEPA and with the consent of VOC, caused to be formalized
and registered the Puerto Vallarta Condominium Declaration dividing the real
property subject to the PRODEPA Trust into two condominium units and a common
access area; one unit consists of the Puerto Vallarta Hotel (the "PUERTO
VALLARTA HOTEL UNIT"), and one unit consists of the Puerto Vallarta Timeshare
Operation (the "PUERTO VALLARTA TIMESHARE UNIT").
G. Bancomer, as Trustee of the NIZUC Trust, acting on the
instructions of NIZUC and with the consent of VOC, caused to be formalized and
registered the Cancun Condominium Declaration dividing the real property
subject to the NIZUC Trust into two condominium units and a common access area;
one unit consists of the Cancun Hotel (the "CANCUN HOTEL UNIT") and one unit
consists of the Cancun Timeshare Operation (the "CANCUN TIMESHARE UNIT").
H. With the consent of VOC in each instance, Bancomer, as
Trustee, PRODEPA, and NIZUC amended and restated the Trust Agreements to
eliminate any restrictions and prohibitions which would have prevented the
closing of the Transaction. The amendments are as set forth in the Amended
PRODEPA Trust and the Amended NIZUC Trust.
I As contemplated by that Second Amended and Restated Stock
Purchase Agreement dated as of August 18, 1997, between Bancomer, Desarrollos
Turisticos Xxxxxx, S. de X.X. de C.V (formerly, Desarrollos Turisticos
Bancomer, S.A. de C.V.) Club Xxxxxx Resorts, Inc. and CR Hotel Acquisition
Company, LLC (the "STOCK PURCHASE AGREEMENT"), the parties thereto later
executed a series of corporate transactions (including stock sales, mergers,
spin-offs of assets and conveyances) as steps in one overall transaction (the
"TRANSACTION"). As a result of the Transaction, Starwood Puerto Vallarta
became the owner of the Puerto Vallarta Hotel Unit, Raintree Puerto Vallarta
became a beneficiary of a trust in which Bancomer, as Trustee, holds title to
the Puerto Vallarta Timeshare Unit (the "PUERTO VALLARTA TIMESHARE TRUST"),
Starwood Cancun became the owner of the Cancun Hotel Unit, and Raintree Cancun
became a beneficiary of a trust in which Bancomer, as Trustee, holds title to
the Cancun Timeshare Unit (the "CANCUN TIMESHARE TRUST").
J. At all times prior to the consummation of the Transaction
either, (i) PRODEPA and NIZUC were indirect subsidiaries of Bancomer, or (ii)
Bancomer was the majority shareholder of PRODEPA and NIZUC and, in either case,
PRODEPA and NIZUC were subject to Bancomer's control. Starwood Puerto
Vallarta, Starwood Cancun, Raintree Puerto Vallarta and Raintree Cancun are not
directly or indirectly owned by or affiliated with Bancomer.
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K. Prior to the consummation of the Transaction, Desarrollos
Turisticos Integrales Cabo San Xxxxx, X.X. de C.V. ("DTI CABO") and Bancomer
entered into trust agreement which was amended and restated as set forth in
public instrument number 16,531 dated January 29, 1993, granted before Xxxxx
Aramouro Xxxxx, Esq., Notary Public No. 3 of Baja California Sur, as registered
in the Public Registry of Property of San Xxxx del Cabo, Baja California Sur,
Mexico (the "DTI CABO TRUST"). The DTI Cabo Trust contemplated the division of
the beneficial interests in the real property that was the subject of the DTI
Cabo Trust into "A" Rights and "B" Rights similar to those contemplated in the
Trust Agreements. The DTI Cabo Trust contemplated that the "A" Rights would be
transferred to parties not identified therein. No such "A" Rights were
actually created and transferred under the DTI Cabo Trust. Consequently,
Bancomer and DTI Cabo were the only parties required to execute or consent to
the declaration of condominium formalized and registered in connection with the
Transaction for the real property held under the DTI Cabo Trust under public
deed No. 34,708, dated August 12, 1997, granted before Xxxxxx Xxxxxx Xxxxxx,
Esq., Notary Public No. 7 of Baja California Sur, Mexico, and the termination
of the DTI Cabo Trust pursuant to public instrument number 34,745, dated August
18, 1997, granted before Xxxxxx Xxxxxx Xxxxxx, Esq., Notary Public No. 7 of
Baja California Sur, Mexico.
AGREEMENT
NOW THEREFORE, in consideration of good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, Bancomer, Raintree
Cancun and Raintree Puerto Vallarta intending to be legally bound, hereby
severally represent, covenant and agree for themselves and their successors and
assigns as follows:
(1) Definitions. As used in this Agreement, the following terms
shall have the following meanings unless the context otherwise requires. All
other capitalized terms used herein which are not defined below shall have the
meanings as set forth in the Recitals or elsewhere in this Agreement.
(a) "Amended NIZUC Trust" means the NIZUC Trust as
amended and restated in public instrument number 11,008, dated August 18, 1997,
granted before Xxxx X. Xxxxxx Patron, acting as alternate of Notary Public Xx.
00 xx Xxxxxx, Xxxxxxxx Xxx, Xxxxxx, registered in the Public Registry of
Property of Cancun, Xxxxxxxx Roo, Mexico.
(b) "Amended PRODEPA Trust" means the PRODEPA Trust as
amended and restated in public instrument number 15,181, dated August 18, 1997,
granted before Xxxxxxxxx Xxxx Xxxxxxx, Esq., acting as alternate of Notary
Public Xx. 0 xx Xxxxxx Xxxxxxxx, Xxxxxxx, Xxxxxx, registered in the Public
Registry of Property of Puerto Vallarta, Jalisco, Mexico.
(c) "Benefited Parties" means (i) Starwood Cancun,
Starwood Puerto Vallarta, Raintree Cancun, Raintree Puerto Vallarta; (ii) all
entities described in Exhibit "A" attached hereto; (iii) all shareholders,
partners and members of all such entities described in clauses (i) and (ii) of
this subsection 1(c); (iv) all successors and assigns of all parties described
in clauses (i), (ii) and (iii) of this subsection 1(c); and (v) the respective
directors,
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officers, agents and employees of all the parties described in classes (i),
(ii), (iii) and (iv) of this subsection 1(c).
(d) "Cancun Condominium Declaration" means the
Declaration of Condominium formalized under public instrument number 10,973,
dated August 11, 1997, registered in the Public Registry of Property of
Xxxxxxxx Roo, Mexico.
(e) "Condominium Declarations" means the Puerto Vallarta
Condominium Declaration and the Cancun Condominium Declaration.
(f) "NIZUC" means Promotora Turistica Nizuc, S. de X.X.
de C.V., formerly Promotora Turistica Nizuc, S.A. de C.V.
(g) "NIZUC Trust" means that trust as amended and
restated pursuant to public instrument number 18,097, dated December 18, 1991
granted before Xxxxxx Xxxxx Xxxxxxxx, Esq., alternate Notary Public of Notary
Public Office No. 7 of Xxxxxxxx Roo, Mexico, executed by Bancomer and NIZUC.
(h) "PRODEPA" means Promotora y Desarrolladora Pacifico,
S. de X.X. de C.V., formerly Promotora y Desarrolladora Xxxxxxxx, X.X. de C.V.
(i) "PRODEPA Trust" means that trust which is public
instrument number 8,588 dated November 13, 1991 granted before Xxxxxxxxx Xxxx
Xxxxxxx, alternate Notary Public of Notary Public Office Xx. 0 xx Xxxxxx
Xxxxxxxx, Xxxxxxx, Xxxxxx, executed by Bancomer and PRODEPA.
(j) "Puerto Vallarta Condominium Declaration" means the
Declaration of Condominium formalized under public deed No. 11,924, dated
August 8, 1997, granted before Xxxxxx Xxxxxx Segundo, Esq., Notary Public Xx. 0
xx Xxxxxx Xxxxxxxx, Xxxxxxx, Xxxxxx, registered in the Public Registry of
Property of Jalisco, Mexico.
(k) "Starwood Cancun" means Starwood Cancun, S. de X.X.
de C.V.
(l) "Starwood Puerto Vallarta" means Starwood Puerto
Vallarta, S. de X.X. de C.V.
(m) "Transaction" shall have the meaning as set forth in
Section I of the Recitals hereto.
(n) "Trust Agreements" means the PRODEPA Trust and the
NIZUC Trust.
(o) "VDC" means Vacation Development Corporation of the
Americas Limited, a company formed and existing under the laws of the Cayman
Islands.
(p) "VOC" means Vacation Ownership Club, a California
non-profit association.
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(2) Representations and Warranties. Bancomer represents and
warrants to the Benefited Parties that:
(a) The facts set forth in Xxxxxxxx X, X, X, X, X, X, X,
X and K of the Recitals hereto are true and correct in all material respects.
(b) VOC validly consented to the Condominium Declarations
and the Condominium Declarations are enforceable against VOC.
(c) The amendments to the Trust Agreements as set forth
in the Amended PRODEPA Trust and the Amended NIZUC Trust are valid and
enforceable against the parties thereto under all applicable laws of the United
States of Mexico and the State of California.
(3) Covenants.
(a) Raintree Puerto Vallarta, as a beneficiary of the
Puerto Vallarta Timeshare Trust, covenants and agrees to comply with the
obligations to VOC and its members under the terms and conditions of the
Amended PRODEPA Trust.
(b) Raintree Cancun, as a beneficiary of the Cancun
Timeshare Trust, covenants and agrees to comply with the obligations to VOC and
its members under the terms and conditions of the Amended NIZUC Trust.
(4) Indemnification.
(a) Bancomer hereby covenants and agrees, with and for
the benefit of each of the Benefited Parties, to protect, indemnify, reimburse,
defend and hold harmless the Benefited Parties, at Bancomer's sole cost and
expense, from and against any and all liabilities, losses, suits, proceedings,
orders, penalties, fines, settlements, judgments, liens, assessments, claims,
demands, damages, injuries, obligations, costs, disbursements, expenses or fees
of any kind or nature (including without limitation, attorneys' fees), which
may at any time be imposed upon, incurred by or asserted or awarded against my
of the Benefited Parties, arising from or growing out of, directly or
indirectly: (i) the breach or inaccuracy of any representation or warranty by
Bancomer, under this Agreement; (ii) any claim by VOC (or any of its members or
prior members), or by any governmental authority of the State of California or
the United States of Mexico, that PRODEPA, NIZUC, VDC, Corporacion Mexitur,
S.A. de C.V. ("MEXITUR") and/or Bancomer, as Trustee (and/or any subsidiaries
of any such entities), failed in any respect to comply with the terms of any of
their respective obligations under, either of the Trust Agreements or of any
other agreement (whether with or by Bancomer, VDC, PRODEPA, Mexitur and/or
NIZUC and/or any subsidiaries of any such entities) with or for the benefit of
VOC or any of its members, at any time prior to the closing of the Transaction;
(iii) Bancomer's exercise of its fiduciary responsibilities (or the failure to
exercise such responsibilities) pursuant to the Trust Agreements prior to the
closing of the Transaction; or (iv) any claim that the board of directors of
VOC (or any of its individual members) either (A) lacked the power or authority
to authorize or consent to, (B) did not duly
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authorize or consent to (as a result of conflicts of interest or otherwise), or
(C) breached a fiduciary duty by authorizing or consenting to, the Condominium
Declarations, the Amended PRODEPA Trust and/or the Amended NIZUC Trusts, or the
transfer of title to all or part of the real property that was held in trust
pursuant to the Trust Agreements.
(b) Raintree Puerto Vallarta covenants and agrees, at its
sole cost and expense, to protect, indemnify, reimburse, defend and hold
harmless Bancomer from and against any and all liabilities, losses, suits,
proceedings, orders, penalties, fines, settlements, judgments, liens,
assessments, claims, demands, damages, injuries, obligations, costs,
disbursements, expenses or fees of any kind or nature (including, without
limitation, attorneys' fees), which may at any time be imposed upon, incurred
by or asserted or awarded against Bancomer, arising from or growing out of, any
claims by VOC or its members resulting from the breach of the covenant set
forth in Section 3(a), provided, however, that this Agreement shall not
obligate Raintree Puerto Vallarta to indemnify Bancomer for, or on account of,
any breach by Bancomer of its obligations or duties as Trustee of the Amended
PRODEPA Trust.
(c) Raintree Cancun covenants and agrees, at its sole
cost and expense, to protect, indemnify, reimburse, defend and hold harmless
Bancomer from and against any and all liabilities, losses, suits, proceedings,
orders, penalties, fines, settlements, judgments, liens, assessments, claims,
demands, damages, injuries, obligations, costs, disbursements, expenses or fees
of any kind or nature (including, without limitation, attorneys' fees), which
may at any time be imposed upon, incurred by or asserted or awarded against
Bancomer, arising from or growing out of, any claims by VOC or its members
resulting from the breach of the covenant set forth in Section 3(b), provided,
however, that this Agreement shall not obligate Raintree Cancun to indemnify
Bancomer for, or on account of, any breach by Bancomer of its obligations or
duties as Trustee of the Amended NIZUC Trust.
(d) For purposes of this Section 4, a party making a
claim for indemnity under this Section 4 is hereinafter referred to as an
"INDEMNIFIED PARTY" and the party against whom such claim is asserted is
hereinafter referred to as an "INDEMNIFYING PARTY". All claims by any
Indemnified Party under this Section 4 shall be asserted and resolved in
accordance with the provisions of subsections 4(e), (f), (g) and (h).
(e) The liabilities, losses, claims, damages, expenses
and other items referred to in subsections 4(a), (b) and (c) above, for which
the Benefited Parties and Bancomer, respectively, are indemnified and held
harmless under this Section 4 shall be reimbursed to the Indemnified Party by
the Indemnifying Party, without any requirement of waiting for the ultimate
outcome of any litigation, claim or other proceeding, if they have already been
incurred, within thirty (30) days after notice from the Indemnified Party,
itemizing the amounts incurred to the date of such notice; provided, however,
that in the event that there is a dispute between the Indemnified Party and the
Indemnifying Party with respect to the amount of any such items, such dispute
shall be resolved in accordance with the arbitration provisions in Section 5(d)
and the reimbursement of the disputed amounts
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described above by the Indemnifying Party shall be contingent on the outcome of
the arbitration of such dispute.
(f) If any claim or demand for which an Indemnifying
Party may be liable to an Indemnified Party is asserted against or sought to be
collected from such Indemnified Party by a third party (in each case, a
"CLAIM"), said Indemnified Party shall promptly notify in writing the
Indemnifying Party of such Claim stating with reasonable specificity the
circumstances of the Indemnified Party's claim for indemnification; provided,
however, that any failure to give such notice will not affect the rights to
indemnity of the Indemnified Party except to the extent that the rights of the
Indemnifying Party are actually prejudiced by the absence or delay of the
notice. Immediately upon becoming aware of a Claim for which indemnity is or
could be sought, the Indemnifying Party shall vigorously and continuously
defend against the Claim and any proceedings resulting or derived therefrom
(with qualified legal counsel reasonably acceptable to the Indemnified Party
and licensed to practice in the jurisdiction in which the Claim is asserted),
and shall take all actions necessary or appropriate, including but not limited
to the posting of such bond or other security as may be required by any
judicial or governmental authority, so as to enable the Claim to be defended
without interfering with the conduct of the business of any Indemnified Party.
At all times, the Indemnifying Party shall keep the Indemnified Party fully
informed of the status of the Claim or any proceedings in connection therewith
and shall consult with the Indemnified Party with respect to the defense
against the Claim. The Indemnified Party shall have the right (at its own
expense) to participate jointly with the Indemnifying Party in the defense of
any Claim in connection with the Indemnified Party's claim for indemnity under
this Section 4, provided that the Indemnifying Party shall retain the right to
direct the defense against the Claim. Except as otherwise provided in
subsection 4(h), the Indemnified Party shall not unreasonably withhold its
consent to the settlement or resolution of a Claim, provided that the
Indemnified Party is not required thereby to incur any present or future cost,
expense or monetary loss.
(g) The Indemnifying Party may not assume the defense if
the named parties to any Claim (including any impleaded parties) include both
the Indemnified Party and the Indemnifying Party, and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. In any such case, the Indemnified Party
shall have the right to employ counsel (duly qualified as provided in
subsection 4(f)) of its choice, at the expense of the Indemnifying Party.
Except as otherwise provided in subsection 4(h), upon request of the
Indemnifying Party, the Indemnified Party shall, to the extent it may legally
do so and to the extent that it is compensated in advance by the Indemnifying
Party for any costs and expenses thereby incurred,
(i) take such action as the Indemnifying Party
may reasonably request in connection with such action,
(ii) allow the Indemnifying Party to dispute such
action in the name of the Indemnified party and to conduct a defense to such
action on behalf of the Indemnified Party, and
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(iii) render to the Indemnifying Party all such
assistance as the Indemnifying Party may reasonably request in connection with
such dispute and defense.
(h) To the extent that any Claim is for, or could result
in, an order or judgment requiring any of (i) the rescission or nullification
of either of the Condominium Declarations, (ii) the amendments to the Trust
Agreements as set forth, respectively, in the Amended PRODEPA Trust or the
Amended NIZUC Trust; (iii) the reconveyance or transfer of any of the property
that was the subject of either of the Trust Agreements; or (iv) any other
modification of any of the Condominium Declarations, the Amended PRODEPA Trust
or the Amended NIZUC Trust, to any extent deemed adverse by any Benefited Party
(in its sole and absolute discretion), Bancomer shall make whatever payment,
restitution, concession, or other arrangement that may be required and
permitted under applicable law to avoid any of the consequences described in
this subsection 4(h).
(5) Miscellaneous Provisions.
(a) No delay on the part of any of the Benefited Parties
or Bancomer in exercising any of their rights, remedies, powers or privileges
under this Agreement, or as otherwise provided at law or in equity, shall
operate as a waiver of any such right, remedy, power or privilege, or excuse
Bancomer, Raintree Puerto Vallarta or Raintree Cancun, as the case may be, from
their obligations hereunder. Any waiver of such right, remedy, power or
privilege by the Benefited Parties or Bancomer must be in writing and signed by
an authorized agent of the Benefited Parties or Bancomer, as the case may be.
(b) All notices hereunder shall be in writing and shall
be deemed to have been sufficiently given or served for all purposes upon the
earlier of (i) actual receipt if delivered by hand or by commercial courier
such as "Federal Express" or "DHL", (ii) receipt by registered or certified
mail, postage prepaid, or (iii) upon confirmation of receipt, if by facsimile
transmission, to the address (or number) indicated, if to:
Bancomer: Bancomer, S.A.
Xx. Xxxxxxxxxxx Xx. 0000
Col. Xoco
X.X. 00000, X,Xxxxxx, D.F.
Fax No. 000-000-000-0000
Attn: Xxxxxx Xxxxxxxx, Chief Financial
Officer Xxxxxx Xxxxxx y Xxxxxx,
General Counsel Xxxxxxxxx
Xxxxxxxxx Mirelles, Dir. of
Mergers and Acquisitions
Starwood Cancun or
Starwood Puerto Vallarta: c/o Starwood Lodging Corporation
0000 Xxxx Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Fax No. (000) 000-0000
Attn: Xxxxxxxx Xxxxxxx
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with a copy to: Greenberg, Traurig, Hoffman, Lipoff,
Xxxxx & Quentel
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No. (000) 000-0000
Attn: Xxxxxx Xxxxxxx
Raintree Cancun or
Raintree Puerto Vallarta: Pennzoil Place-South Tower
Suite 2310, 000 Xxxxxxxxx
Xxxxxxx, Xxxxx 00000
Fax No. (000) 000-0000
Attn: Xxxxxxx X. Xxxx
with a copy to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
Pennzoil Place-South Tower Suite
1900, 000 Xxxxxxxxx
Xxxxxxx, Xxxxx 00000
Fax No. (000) 000-0000
Attn: Xxxxx X. Xxxxxxxx
Other Benefited Parties: See Exhibit "B" attached hereto.
Any party may designate a change of address by written notice (in accordance
with the provisions of this Section) to any other party, received by such other
party at least ten (10) days before such change of address is to become
effective.
(c) This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original. Said counterparts
shall constitute but one and the same instrument and shall be binding upon each
of the undersigned individually as fully and completely as if all had signed
but one instrument so that the liability of each of the undersigned shall be
unaffected by the failure of any of the undersigned to execute any or all of
said counterparts.
(d) This Agreement and the rights and obligations of the
parties hereunder shall in all respects be construed, interpreted, enforced and
governed by and in accordance with the laws of the State of New York (excluding
the principles thereof governing conflicts of law). In the event that any of
the parties hereto are unable to resolve any dispute, controversy or claim
arising out of or in connection with this Agreement (a "CONTROVERSY"), either
party may request in writing that the Controversy be referred to the respective
senior level management of each party for decision. Such managers shall meet
immediately and attempt in good faith to negotiate a resolution of the
Controversy. If the managers are unable to resolve the matter within thirty
(30) days of the written request referring the matter to
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them, any party may, within thirty (30) days following the end of such thirty
(30) day period, elect to refer the matter to arbitration and the Controversy
shall be resolved by binding arbitration in accordance with the Arbitration
Rules of the International Chamber of Commerce (the "ICC") then in effect (the
"RULES").
(i) There shall be a sole arbitrator selected in
accordance with the Rules. If the parties are unable to agree upon the
arbitrator within thirty (30) days of the referral to arbitration, the
International Court of Arbitration of the ICC shall make such appointment in
accordance with the Rules. The arbitration shall be conducted, and the award
shall be rendered, in the English language. The arbitration shall be held in
New York, New York.
(ii) Each party shall cooperate with the other
party in making full disclosure of and providing access to all information and
documents requested by the other party in connection with such proceedings.
The arbitrator shall have the power to order such disclosure. Should a party
fail to comply with such order, the arbitrator shall take such refusal into
account in determining any award.
(iii) The decision of the arbitrator shall be final
and binding on the parties and shall be the sole and exclusive remedy regarding
any claims, counterclaims, issues or accounting presented to the arbitrator.
Judgment upon the award may be entered by any court having jurisdiction
thereof. The parties agree to waive any rights of recourse or appeal to any
court in connection with any questions of law arising in the course of the
arbitration or with respect to any award made except for actions to enforce an
award.
(iv) Any monetary award shall be made and payable
in United States Dollars. The arbitrator shall be authorized to grant
pre-award and post-award interest at commercial rates without there being any
presumption as to whether such interest will be granted. Unless otherwise
ordered by the arbitrator, each party shall bear its own costs and fees,
including attorneys' fees and expenses. The parties expressly agree that the
arbitrator shall have no power to consider or award punitive or exemplary
damages.
(v) This agreement to arbitrate shall be binding
upon the successors, assigns, trustee, receiver or executor of each party.
(e) Except as expressly provided herein to the contrary,
this Agreement shall be binding upon and inure to the benefit of the Benefited
Parties and Bancomer and their respective heirs, personal representatives,
successors and assigns. Notwithstanding the foregoing, Bancomer shall not
delegate or assign any of its obligations hereunder without the prior written
consent of all of the other parties hereto. The respective obligations of
Raintree Puerto Vallarta and Raintree Cancun shall be deemed to run with the
respective ownership of the beneficial interests in the Puerto Vallarta
Timeshare Trust and the Cancun Timeshare Trust. Consequently, if either of
such beneficial interests should be transferred, the transferee shall
automatically be deemed to have assumed the obligations of its transferor and
the transferor shall have no further obligation under this Agreement.
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(f) Any reference in this Agreement to attorneys' fees
paid or incurred by any party shall include reasonable and documented
paralegals', consultants' or experts' fees and disbursements and costs of
litigation, appeals and any other legal or administrative proceeding
(including, without limitation, such fees or expenses incurred in any and all
judicial, bankruptcy, reorganization, administrative, or other proceedings,
including appellate proceedings, whether such fees or expenses arise before
proceedings are commenced or after entry of a final order or judgment).
(g) In the event that any Indemnified Party is required
to bring any action to enforce the payment or performance of the obligations of
any Indemnifying Party, the prevailing party shall be entitled to recover its
attorneys' fees.
(h) Use of any gender shall include all other genders and
words in the singular include the plural, and the plural include the singular.
(i) If any provision of this Agreement shall be contrary
to the laws of the jurisdiction in which the same shall be sought to be
enforced, the illegality or unenforceability of any such provision shall not
affect the other terms, covenants and conditions hereof, and the same shall be
binding upon the parties hereto with the same force and effect as though such
illegal or unenforceable provision were not contained herein.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
Signed, sealed and delivered
in the presence of: BANCOMER S.A. INSTITUCION DE,
BANCA MULTIPLE GRUPO
FINANCIERO
By:
---------------------------- ----------------------------
Name:
---------------------------- --------------------------
Title:
-------------------------
C.R. RESORTS CANCUN, S. DE X.X. DE C.V.
By:
---------------------------- ----------------------------
Name:
---------------------------- --------------------------
Title:
-------------------------
C.R. RESORTS PUERTO VALLARTA,
S. DE X.X. DE C.V.
By:
---------------------------- ----------------------------
Name:
---------------------------- --------------------------
Title:
-------------------------
11
