Dear Spinnaker Owner,

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1 Dear Spinnaker Owner, Thank you for becoming a Spinnaker Resorts Owner and joining our over 40,000 other vacation Owners. We are committed to ensuring that your ownership and vacation experiences are the best they can possibly be. Whether you have purchased vacation time at a Spinnaker Resort in Hilton Head, S.C., Ormond Beach, FL., or Branson, MO., we are confident that you will be enjoying a lifetime of smooth sailing vacations. In addition to the information you received when you purchased your Spinnaker vacation, we wanted to remind you of the resources available to you - our new Owner. Spinnaker Owners Website You will be able to access the Owners site once your Owner Contract has been processed. You ll find the most current Owner information on the secure Owners website, including vacation planning information and Spinnaker Rewards information. Vacation planning can be as easy as If you have a loan, you can access Equiant Financial Online to view your account and make payments. Making Float Reservations As a new Owner, Spinnaker wants to ensure that your most important question is answered, When and how can I book my float use reservation? o o Hilton Head, SC and Branson, MO, and Royal Floridian South, FL Owners: You can book your float resort reservation 360 days before your desired check in day. Royal Floridian, FL Owners: You can book your float resort reservation 365 days before your desired check in day. your reservation requests to: res@spinnakerresorts.com Exchange Memberships Spinnaker will pay for and enroll you into your purchased resorts respective Exchange Affiliation Membership so that you can enjoy the many benefits of our Exchange affiliates programs including exchange, extra vacations, car rental, vacation concierge and other programs. You will receive your Exchange Membership number from them within 60 and 90 business days. Help Us Go Green Sign Up for Paperless Communications If you have an address, we encourage you to forward it to addressupdate@spinnakerresorts.com so that you may receive your updates and communications via . Join in our efforts to preserve our resources. Again, thank you and congratulations. We look forward to providing you with many memorable and fun filled vacations with us! Regards, Owner Services Spinnaker Resorts (877) spinnakerresorts.com Hilton Head Island, SC Ormond Beach, FL Branson, MO 1

2 SPINNAKER RESORTS OWNER PROGRAMS SPINNAKER REWARDS Earn additional vacations or offset your vacation expenses Participate in this loyalty / referral program and earn Spinnaker Rewards Credits (SRCs) that you can allocate however you desire. EARN REWARDS: Submit referrals, add-on to your vacation, rent a Spinnaker condominium / stay at S.R Hotel. Owner Programs are subject to change. Visit spinnakerresorts.com for current programs. ENJOY REWARDS: Save money by allocating SRCs toward Association Fees, take additional vacation at a Spinnaker Resort, through Exchange affiliates, or at S.R Hotel. Refer to your Spinnaker Rewards Guide or rewards@spinnakerresorts.com for details.

3 OWNER BONUS TIME EXCHANGE BENEFITS Treat yourself to additional vacations with Owner s only pricing Plan incremental vacations at a different Spinnaker location or add-on to your designated ownership time and save fifty percent (50%) off regular pricing for reservation requests made thirty (30) days prior to check-in date. Reservations may be made even farther in advance for Hilton Head Island and Branson (from November 1st through February 28th). Refer to your Owner s website (under Owner Bonus Time) or res@spinnakerresorts.com for pricing and conditions. Spinnaker s top resort exchange Ratings provide greater exchange opportunities At Spinnaker we strive to maintain the highest quality standards at our resorts for your vacation enjoyment and satisfaction. As a Spinnaker Owner, you automatically have priority reservation privileges (over non-spinnaker exchange guests) at your home resort and all Spinnaker properties. Because Spinnaker Resorts have the highest resort ratings / designations, you can exchange to other top-rated resorts worldwide.

4 OFFSET ASSOCIATION FEES EARN EXTRA VACATIONS Dear Spinnaker Vacation Owner, As a Spinnaker Owner, you are entitled to the many benefits of Spinnaker Rewards. Through Spinnaker Rewards, you can earn Spinnaker Rewards Credits (SRCs), which can save you money (offset /cover your Association Fees), or be allocated toward additional vacations (short or long getaways at any Spinnaker Resort or through II or RCI). Have a look through the Rewards Guide to understand all the ways you can earn and redeem Rewards. The easiest way to earn SRCs is through Referral submissions. By introducing friends, family, and colleagues to the Spinnaker way of vacationing, you would be helping them improve their lifestyle. Refer those who share the same vacation goals as you - those who d like to who d like to: Enjoy an economical way of vacationing Ensure they vacation regularly (to promote and maintain good health) Establish a tradition (to reconnect with significant other and/or family) To submit Referrals, you can find Referral Forms on the Spinnaker website. Also, for your reference and use, all Rewards information and forms reside on your Owners website under REWARDS. You will have access the Owners site once your Owner Contract has been processed. To access: 1. Go to spinnakerresorts.com, Click on OWNER LOGIN (top right corner) 2. Your login details will be: I. Username: Owner ID/ address II. Password*: Zip Code/Postal Code *For optimum security, we recommend changing your Password after your initial login. Please contact us with any questions you have regarding your Spinnaker Rewards loyalty program, we ll be pleased to answer any questions you may have. Sincerely, Spinnaker Rewards Phone: (888) rewards@spinnakerresorts.com spinnakerresorts.com Hilton Head Island, SC Ormond Beach, FL Branson, MO 1

5 ROYAL FLORIDIAN QUICK REFERENCE GUIDE FLOATING USAGE GUIDE (pgs 1-3) PROCEDURES FOR RESERVING USAGE (pgs 4-5) BUDGET (pg 6) RULES AND REGULATIONS (pgs 7-10) PRIVACY ASSURANCE POLICY (pg 11) ADDITIONAL INFORMATION IS AVAILABLE ON SPINNAKER S WEBSITE spinnakerresorts.com VISIT THE OWNER WEBSITE spinnakerresorts.com/main/owners BOOK YOUR SPINNAKER VACATION TODAY! res@spinnakerresorts.com November 2016

6 Royal Floridian FLEXIBLE/FLOATING TIME USAGE GUIDE Reservation requests will be confirmed on a first come, first served, availability basis. In the event an owner fails to obtain a confirmed reservation during a given use year, there will be no carryover of such owner s reservation rights to the succeeding use year. The earlier a reservation request is submitted, the better chance that a reservation confirmation can be secured. All Timeshare Intervals shall be subject to the use restriction of Floating Time, unless there is a clear and specific intention otherwise stated in the deed to the purchaser of a Timeshare Interval or subsequently Fixed pursuant to the Procedures for Reserving Usage, in which case usage shall be on a Fixed Time basis. Through acceptance of a conveyance of a Floating Time Timeshare Interval, each Owner acknowledges and agrees that, notwithstanding the specific Timeshare Interval owned, all Timeshare Intervals of the same premium designation in similar Unit types shall be available for use by all Owners of such Timeshare Intervals on a first come, first served, reservation basis, in accordance with the Procedures for Reserving Usage. Notwithstanding the actual time each Day or Unit Week may begin, the Managing Entity has the discretion to annually vary the beginning and ending day in any given Unit in order to further the collective enjoyment of the use of the Component Site Timeshare Plan by Owners as a whole. No Owner of a Floating Time Timeshare Interval shall have the right to use or occupy a Unit without first receiving a confirmed reservation as provided in the Procedures for Reserving Usage. Owners of Biennial Unit Weeks shall not be entitled to request and will not be granted a confirmed reservation for use of a Unit in any year other than years of their Biennial Unit Weeks. The Managing Entity reserves the right, in its sole discretion, to amend the Procedures for Reserving Usage as more specifically provided therein. Notwithstanding the foregoing, however, the Managing Entity shall make no amendment to the Procedures for Reserving Usage which would result in Owners competing for reservations on more than a one-to-one purchaser to accommodation ratio, as defined in (23), Florida Statutes. As more specifically set forth in the Procedures for Reserving Usage, each Use Year, an Owner may reserve one Use Period of seven consecutive days for each Unit Week owned. Reservation requests will be accepted up to one year prior to the requested check-in date (thirteen months for multiple Unit Week Owners reserving concurrent or consecutive Use Periods), and will be confirmed on a first come, first served, availability basis. Any Use Period not reserved by an Owner prior to the first day of such Use Period may be reserved by the Association for its own use and benefit. Use Periods may not be available for reservation or use by Owners, if the Association exercises this right, or if an owner fails to make a reservation request; is unwilling to accept any available Use Periods; or if the Owner's request cannot otherwise be confirmed. Subject to restrictions contained in the Procedures for Reserving Usage, the Managing Entity shall have the right, but not the obligation, to allow the reservation of Use Periods of less than three consecutive days, as well as to implement a banking and/or borrowing program and to establish wait and holiday request lists. An Owner may cancel a confirmed reservation thirty (30) days or more days before check-in without penalty, although there is no guarantee that another Use Period will be available for reservation by the Owner during that Use Year. An Owner who cancels a confirmed reservation less than thirty (30) days before check-in will not be permitted to reserve another Use Period in that Use Year. Pursuant to the Procedures for Reserving Usage, the Managing Entity may impose a $35.00 administrative fee for each canceled reservation. Reservation requests will be confirmed on a first come, first served, availability basis. In the event an Owner fails to obtain a confirmed reservation during a given Use Year, there will be no carryover of such Owner's reservation rights to the succeeding Use Year. The earlier a reservation request is submitted, the better the chance that a reservation confirmation can be secured. Page 1

7 FLOATING TIME USAGE GUIDE (Detailed) Reservation Requests. First Come, First Served. Reservation requests for a particular Interval or Partial Interval will be taken on a first come, first served basis within each calendar year. To reserve a given Interval or Partial Interval on a space available basis, the Owner or Principal Contact must call or mail a request to the Managing Entity (i) no earlier than three hundred sixty-five (365) days and (ii) no later than seven (7) days, in advance of the first day (the Check-in Day ) of the Interval or Partial Interval that the Owner wants to reserve. The Managing Entity, upon receipt of the reservation request, shall assign the Owner the use of a designated Unit, for the time period requested if available. Unit Type Restriction. There are four categories of units, designated on Exhibit B to the Declaration, with a letter from A through C and E, inclusive, as follows: Two Bedroom Deluxe Two Bedroom Standard One Bedroom Deluxe Studio A B C E An owner of an A unit week may reserve a unit with a designation of A, B, C, or E; An owner of an B unit week may reserve a unit with a designation of B, C, or E; An owner of an C unit week may reserve a unit with a designation of C or E; An owner of an E unit week may reserve a unit with a designation of E; Reservation Priorities. Reservation requests are subject to the following priorities: The Managing Entity shall have the right to reserve, at any time, any week it chooses for each Unit each year (one week per Unit annually), in its sole discretion, for maintenance purposes. If a reservation request is not received by the beginning of the fourteenth day preceding the Check-in Day, the Managing Entity s ability to confirm a Floating Unit Week Owner s reservation request for the requested Interval or Partial Interval will be limited by and subject to the following reservations: (I) any rental reservations made by the Association, in its sole and absolute discretion, for Association s own benefit as permitted by the Declaration; (ii) any reservations made by the Association, in its sole and absolute discretion, and banked with a third party exchange program on behalf of Floating Unit Week Owners who are members of the third party exchange program and who have failed to reserve a Floating Unit Week in a timely fashion, and have no other use alternative; or who canceled late due to unusual circumstances and risk losing use for that calendar year; (iii) any use of the third party exchange program by the Association for its own purposes including for exchange, promotional use, rental or any other purpose as the Association determines in its sole discretion. Although the Managing Entity will continue to take reservation requests up to the Check-in Day of any given Interval or Partial Interval, the ability of the Managing Entity to confirm reservations shall be limited by the reservation priorities. Other Restrictions. The reservation system shall be subject to such other conditions, restrictions and limitations as the Association shall deem necessary under the circumstances in order to assure a manageable and fair system to Floating Unit Week Owners as a whole. Reservation Required for Rental or Exchange. Before a Floating Unit Week Owner may rent or exchange an Interval or Partial Interval in the Time Share Plan system, the Floating Unit Week Owner must first receive a confirmed reservation from the Managing Entity for a particular Interval or Partial Interval. Page 2

8 Confirmations: Unit Preferences. Written confirmation for a particular accommodation type will be ed, if available, to each Owner or Principal Contact by the Managing Entity to document all confirmed reservations. Designated Units will be assigned by the Managing Entity at the time of reservation confirmation; however, the Managing Entity shall have the right to change the designated Unit up to the time of the Check-in Day of the assigned Interval or Partial Interval, as long as the occupant is reserved into a Unit of comparable type within the same use period. Special accommodations assignments cannot be guaranteed, but will be noted as a preference in the reservation confirmation. Changes, Cancellations and No-Shows. A Floating Unit Week Owner may change or cancel a confirmed reservation one time each year without penalty; the Association may impose a $35.00 charge for each excess cancellation or change. If the Owner changes or cancels his reservation prior to fourteen days of the Check-in Day, he may thereafter make a new reservation for a new Interval or Partial Interval within the same calendar year on a space available basis. If the Owner changes or cancels his reservation within seven (7) days of the Check-in Day, he may thereafter only make a new reservation for a new Interval or Partial Interval during that calendar year on a space available basis, subject to all priorities set forth in these Floating Use Plan Rules and Regulations from time to time. Floating Unit Week Owners who fail to arrive on the Check-in Day of the reserved Interval or Partial Interval must notify the Managing Entity that they will be arriving subsequent to such Check-in Day or risk losing the reservation. Assessment Fee or Ad Valorem Property Tax Delinquency. A Floating Unit Week Owner who is delinquent in the payment of any Assessment fee or Ad Valorem Real Estate Tax assessment imposed against that Owner s Floating Unit Week shall not be allowed to reserve a Floating Unit Week under the reservation program of the Floating Use Plan, and any previously confirmed Floating Unit Week reservation may be cancelled, until the delinquency is satisfied in full. Amendments to the Rules and Regulations. Pursuant to the Declaration, the Board of Directors of the Association shall be responsible for amending the Floating Use plan Rules and Regulations from time to time as may be necessary in the opinion of the Board of Directors to improve upon the quality and operation of the Floating Use Plan and to further the collective enjoyment of the use of the Units committed to the Plan by the present and future Floating Unit Week Owners as a whole. Conflicts. These Rules and Regulations are subordinate to and designed to supplement the Declaration, and in the event of a conflict therewith, the Declaration shall control. Page 3

9 Royal Floridian PROCEDURES FOR RESERVING USAGE 1.1 RESERVATON AND CONFIRMATION OF FLOATING TIME USE PERIODS. For each Unit Week with Floating Time Rights, the Owner thereof must reserve and have confirmed a Unit and a check-in -check-out day according the following rules: Owners with Floating Time Rights must make their reservation request in writing. An online reservation request form is available for completion and submission at spinnakerresorts.com, or your reservation request to res@spinnakerresorts.com, alternatively you can fax your reservation request to All reservation requests will be processed on a first come first served basis. Purchasers of a Unit Week with Floating Time Rights becomes eligible to make a reservation request thirty (30) days after the purchase agreement has closed by the Developer for the Unit Week purchased. Owners will have the ability to request a reservation for an accommodation on a first come, first served basis, with other owners, beginning 365 days in advance of the requested check-in day. Multiple Unit Week Owners can reserve concurrent or consecutive Use Periods 395 days in advance of the first requested check-in day for the first Use Period reserved, however, no more than fifty percent (50%) of the available inventory can be reserved in this manner. Any cancellation for a Use Period reserved in this manner must include all concurrent or consecutive Use Periods following the Use Period cancelled. Except as indicated in Section 1.5 and except to the extent that the Managing Entity institutes a program of banking as described in Section 1.7, owners with Floating Time Rights are entitled to request three (3), four (4) or seven (7) nights of occupancy during each Use Year in which they have the right to reserve and use a Unit for each Use Period owned. All nights must be used in the same Use Year. Unused or unreserved nights may not be carried over into subsequent Use Years, unless the program of banking is established. An Owner may cancel a reservation without penalty by giving notice at least thirty (30) days before the check-in date, but is not guaranteed another reservation for such Use Year. An Owner who cancels his or her reservation less than thirty (30) days before the check-in date will be assessed a $35.00 fee and may not be allowed another reservation for such Use Year. Owners desiring to exchange their right to use a Unit through an exchange company must first obtain a confirmed reservation pursuant to these Rules prior to seeking to trade within any exchange system. If designation of a specific Unit is required to effectuate an exchange, the Managing Entity, upon notification of this fact by the Owner, will provide the Owner with a designated unit and week to effectuate an exchange. 1.2 USE OF UNRESERVED USE PERIODS. The Association has the right to reserve and use any unreserved Use Periods prior to the first day of the Use Period. If the Association makes use of the such Use Period, that Use Period may not be available for reservation or use by Owners. If the Association exercises this right, or if an Owner fails to make a reservation request; is unwilling to accept any available Use Periods; or if the Owner's request cannot otherwise be confirmed, an Owner could lose the opportunity to use a Use Period in a given Use Year. 1.3 UNIT ASSIGNMENTS. Unit assignments shall be made by the Managing Entity prior to or upon arrival. Page 4

10 1.5 GENERAL RULES FOR RESERVATION AND USE. (a) Reservation requests will not be accepted from Owners who have outstanding charges and Owners or others claiming a right to use through them will not be assigned or allowed to use a Unit until all outstanding charges, property taxes, annual assessments, special assessments, to include interest and late charges, if any, have been paid in full. (b) Failure to request a reservation for a Use Period in a Use Year, or to receive a particular desired reservation, does not relieve the Owner from the obligation to pay all charges attributable to each Unit Week owned. (c) Members of exchange programs who desire to exchange their Use Period through the exchange company should consult their exchange company directory and membership material for trading rules which govern reservation exchange requests. (d) If an Owner purchased a Biennial Unit Week, all of these rules provided herein shall apply for each Use Year in which that Owner is entitled to exercise reservation and occupancy rights. For purposes of this Section, "Weekend Occupancy Period shall mean a period of three (3) consecutive nights commencing on a Friday (or another starting day designated by the Managing Entity at 4:00 p.m. and ending on the next following Monday at 10:00 a.m. "Weekday Occupancy Period" shall mean a period of four (4) consecutive nights commencing on Monday (or another starting day designated by the Managing Entity) at 4:00 p.m. and ending on the following Friday at 10:00 a.m. Reservations for a Partial Interval may be made no more than ninety (90) days in advance of the first day of the reservation and not later than seven (7) days in advance of the first day of the reservation. However, confirmation of the reservation of the remaining portion of the split week will depend on the number and timing of other similar split week requests, and will be subject to the Managing Entity's ability to match up complementary requests. In the event an Owner's request cannot be matched up with a complementary request, the Owner's request will be denied and the Owner may lose the use of the remaining Weekend Occupancy Period or Weekday Occupancy Period. The Managing Entity shall establish, from time to time, the additional charges for housekeeping that will be imposed on Owners who utilize any Weekend Occupancy Period and/or any Weekday Occupancy Period. This charge is to pay for such additional costs as may be incurred by the Association and/or Managing Entity as a result of the Weekend Occupancy Period and/or Weekday Occupancy Period. 1.6 DAILY USAGE. The Managing Entity shall have the right, but not the obligation, to amend these rules in its sole discretion to allow Owners to reserve daily occupancy. 1.7 EVENT WEEKS. Owners of Event Weeks shall be entitled to the use and occupancy of a unit, in accordance with the use period established in Section 2.27 of the Declaration of Condominium. The weeks will float with the scheduled date of the event, however, Owners of Event Weeks shall not be required to reserve or confirm a Unit or a check-in/check-out day. 1.8 NON-EVENT WEEKS. Non-Event Week owners shall not be entitled to reserve use periods which fall within an Event Week during any calendar year. Page 5

11 2017 Annual Budget Royal Floridian Resort Association, Inc. Annual Budget to Budget Comparison by Department Year Ended December 31, Budget Budget Variance Studio 1 Bedroom 2 Bedroom $ % 728 Intervals 780 Intervals 4,472 Intervals REVENUES Owner Assessments $ 3,677,446 $ 3,600,414 $ 77, % $ $ $ HOA Inventory Revenue Loss (96,255) - (96,255) na (8.86) (14.48) (17.56) Rental Revenue 406, ,211 30, % Tiki Bar Revenue 93,246 89,573 3, % Collection/Late Fee Income 45,836 38,084 7, % Miscellaneous Income 108,986 63,549 45, % TOTAL REVENUE 4,235,470 4,167,831 67, % OPERATING EXPENSES GENERAL AND ADMINISTRATIVE Resort Operations Payroll Expense 191, ,368 (171) (0.1%) Shared Services Payroll Expense 125, ,745 (14,183) (10.1%) Reservations Payroll Expense 48,460 47,081 1, % Credit Card Fees 49,307 46,436 2, % Professional Fees 18,000 18, % Overhead Expense 215, ,131 6, % SUBTOTAL 648, ,761 (3,309) (0.5%) FRONT DESK Payroll Expense 234, ,180 29, % Overhead Expense 23,909 27,765 (3,856) (13.9%) SUBTOTAL 258, ,945 26, % HOUSEKEEPING Payroll Expense 269, ,687 23, % Contract Labor Housekeeping 384, ,016 49, % Annual Cleaning Fees 21,116 17,889 3, % Guest Supplies & Condo Items 73,662 70,000 3, % Linens & Towels 40,000 36,000 4, % Cleaning Supplies and Other 64,232 55,296 8, % SUBTOTAL 852, ,888 93, % PROPERTY MANAGEMENT Payroll Expense 253, ,521 (22,365) (8.1%) Pest Control 11,400 11, % Pool Service/Supplies/Repairs 31,578 26,142 5, % Landscaping 10,287 10, % Supplies, Repairs and Other 101, ,163 (23,141) (18.6%) SUBTOTAL 407, ,141 (39,698) (8.9%) TIKI BAR Cost of Sales 30,347 30, % Payroll Expense 42,231 42, % Overhead Expense % SUBTOTAL 73,507 73, % ACTIVITIES Payroll Expense 85,164 84,107 1, % Supplies and Other 40,392 49,264 (8,872) (18.0%) SUBTOTAL 125, ,371 (7,815) (5.9%) UTILITIES Cable TV and Internet 55,262 53,445 1, % Contract Services 4,574 4, % Electricity 129, ,790 (5,081) (3.8%) Propane Gas 28,457 32,409 (3,952) (12.2%) Trash Removal 21,218 21,401 (183) (0.9%) Water and Sewer 72,148 75,112 (2,964) (3.9%) SUBTOTAL 311, ,186 (9,818) (3.1%) FIXED EXPENSES Bad Debt Expense 364, ,628 (454) (0.1%) Management Fees 245, ,755 22, % Property Insurance Expense 138, ,994 (13,135) (8.6%) SUBTOTAL 748, ,377 8, % TOTAL OPERATING EXPENSES 3,425,470 3,357,831 67, % Reserves for Replacements 810, , % TOTAL OPERATING EXPENSES AND RESERVES $ 4,235,470 $ 4,167,831 $ 67, % $ $ $

12 Royal Floridian CONDOMINIUM RULES AND REGULATIONS 1. VIOLATIONS OF CONDOMINIUM RULES AND REGULATIONS Violations should be reported in writing to the Management Company or an officer of the Association. If no separate Management Company exists, then to the Board of Directors of the Association. Violations will immediately be called to the attention of the violating Owner by the Management Company or President of the Association, Rules Violation Committee, and the appropriate committee of the Board of Directors, if applicable, or the members of the Board of Directors, if follow-up action is necessary Violations needing follow-up action will be presented to and considered by the Board of Directors for appropriate action at its next regularly scheduled meeting or at a special meeting called for this purpose. 2. FACILITIES The facilities, if any, which are part of the Common Elements of the Condominium or Association Property are for the exclusive use of Association Owners, lessees, resident house guests, guests accompanied by a owner and other authorized users, unless otherwise provided that such use shall not be exclusive. Any damage to the buildings, recreational facilities or other common areas or equipment caused by any of the foregoing authorized users shall be repaired at the expense of the Owner and/or the authorized user. 3. NOISE Should noise transmission create a disturbance or a nuisance, the responsibility is with the Owner to abate the noise transmission and not the Association. In order to insure the comfort of all Association Owners and authorized users, between the hours of 10:00 p.m. and 8:00 a.m. radio, stereo and television sets, and all other such audio equipment should be turned down to a minimum volume so as not to disturb other persons. All other unnecessary noises between these hours should be avoided. 4. NUISANCES No nuisance shall be allowed upon the Condominium Property or within a Unit, nor any use or practice that is the source of annoyance to Owners or which interferes with the peaceful possession and proper use of the Condominium Property by the Owners. No Owner shall permit any use of a Unit or make or permit any use of the Common Elements that will increase the cost of insurance upon the Condominium Property. 5. LAWFUL USE No improper, offensive or unlawful use shall be made of the Condominium Property or a Unit, and all valid laws, zoning ordinances and regulations of all governmental bodies having jurisdiction shall be observed. The responsibility of meeting the requirements of governmental bodies for maintenance, modification or repair of the Condominium Property or a Unit shall be the same as the responsibility for the maintenance and repair of the property concerned. 6. PETS Except for dogs that are certified as handicapped assistance animals, as may be required by an owner or authorized user, no bird, reptile, animal or pet of any kind shall be kept or harbored in the Unit, Common Elements, Limited Common Elements or on the Condominium or Association Property by a timeshare interval owner. 7. OBSTRUCTIONS Sidewalks, entrances, driveways, passages, patios, courts, vestibules, stairways, corridors, halls and/or all other areas intended for common use must be kept open and shall not be obstructed in any manner. Rugs or mats, except those either permitted or placed by the Association or the Management Company, must not be placed outside of doors in corridors. No sign, notice or advertisement shall be inscribed or exposed on or at any window of a Unit or any part of the Condominium or Association Property, except that the right is specifically reserved to the Developer to place and maintain "For Sale" or "For Rent" signs on the Condominium Property for as long as it may have Units or Unit Weeks to sell, and except as shall have been approved in writing by the Association; nor shall anything be projected out of any window in the Condominium Property without similar approval. No radio or television aerial or antenna shall be attached to or hung from the exterior of the Condominium Property or the roof thereon without the express approval of the Association. All personal property of the Owners shall be stored within the Unit. Page 7

13 8. CHILDREN Children are to play only in areas either designated or clearly intended for play, and they are not to play in public halls, on stairways, or other common areas which would cause an obstruction. Reasonable supervision by parents or guardians must be exercised at all times when children are playing on the Condominium or Association Property. 9. DESTRUCTION OF OR MISSING PROPERTY Neither owners, their dependents, nor guests shall mark, damage, destroy, deface or engrave any part of the buildings or improvements. Owners shall be responsible for any such damage. The authorized user(s) and/or the Owner of a Unit subject to interval Ownership shall be responsible for theft or breakage of or damage to the personal property contained within the Unit authorized for use and shall reimburse the Association for all costs and expenses to repair and/or replace such personal property. 10. EXTERIOR APPEARANCE The exterior of the Condominium Property and all other areas appurtenant to it shall not be painted, decorated or modified by an Owner (or their dependents and guests) in any manner without prior written consent of the Association, which consent may be withheld on purely aesthetic grounds within the sole discretion of the Association. No awnings, window guards, light reflective materials, hurricane or storm shutters, ventilator, fans or air conditioning devices shall be used in or about the Condominium Property except as shall have been approved by the Association in writing, which approval may be withheld on purely aesthetic grounds within the sole discretion of the Association. 11. DECORATION OF UNITS No Owner shall alter the furnishings, appliances, personal property or decor of any Unit committed to the Timeshare Plan without the prior written consent of the Board of Directors. The Association shall determine the interior color scheme, decor and furnishings of each Unit committed to the Timeshare Plan as well as the proper time for redecorating and renovating such Unit and its contents. 12. CLEANLINESS All garbage and refuse from the Condominium or Association Property shall be deposited with care in garbage containers and trash chutes intended for such purposes only at such times and in such manner as the Association will direct. All in-sink disposals shall be used in accordance with instructions given to the Owner by the Association. 13. BALCONIES Plants, pots, receptacles and other movable objects must not be kept, placed or maintained on ledges or balconies. No objects shall be hung up or shaken from balconies or window sills. No cloth, clothing, rugs, beach blankets, beach towels or mops shall be hung up or shaken from windows, doors or balconies. No cooking, including but not limited to, the use of any type of barbeque grill, shall be permitted on any balcony of a Unit. Owners shall not allow anything to be thrown or to fall from windows, doors, balconies or the interior of the building. 14. HALLWAYS Bicycles, garbage cans, laundry, dry cleaning, supplies or other articles shall not be placed in the halls or on staircase landings. No owner shall allow doors to the corridor to remain open for any purpose other than for immediate ingress and egress. 15. ENTRY FOR EMERGENCIES In case of emergency originating in or threatening any Unit, regardless of whether or not the Owner is present at the time of such emergency, the Board of Directors of the Association, the Management Company or any other person authorized by them, shall have the right to enter such Unit for the purpose of remedying or abating the cause of such emergency, and such right of entry shall be immediate, and to facilitate entry in the event of any such emergency. 16. PLUMBING Plumbing shall not be used for any other purpose than those for which it was constructed, and no sweepings, rubbish, rags or other foreign substances shall be deposited into plumbing. The cost of any damage resulting from misuse shall be borne by the Owner. 17. ROOF Owners are not permitted on the roof of any building within the Condominium or Association Property for any purpose without the express approval of the Board of Directors or Management Company. Page 8

14 18. SOLICITATION There shall be no solicitation by any person anywhere on the Condominium or Association Property for any cause, charity or purpose whatsoever, unless specifically authorized in writing by the Board of Directors or the Management Company, except for solicitation by the Developer in marketing the Condominium and other timeshare resorts developed or under development by the Developer. The foregoing shall not be deemed to restrict any owner's right arising under Chapter 718 to peaceably assemble or right to invite public officials or candidates for public office to appear and speak at or within the administration building in accordance with reasonable rules that either the Board of Directors or the Management Company may from time to time adopt. 19. PARKING No vehicle belonging to any Owner or to a member of the family of an Owner or guest, tenant or employee of an Owner shall be parked in any unauthorized area or in such manner as to impede or prevent access to another Owner's or authorized user's parking space or any fire lane (s). The Owners, their employees, servants, agents, visitors, licensees and the Owner's family will obey all posted parking regulations. Vehicles parked in any unauthorized areas or impeding another Owner's or authorized user's parking space or any fire lane (s) are subject to being towed away at the Owner's or authorized user's sole expense. No repair of vehicles shall be made within the Condominium or Association Property. No Owner shall store or leave boats, trailers, mobile homes, recreational vehicles and the like on the Condominium Property. No trucks or buses may be parked anywhere on Condominium or Association Property, except for those of the Developer and/or the Management Company of the Condominium, if any. Parking spaces are not assigned as appurtenances to particular Condominium Parcels. As such, each space may be used by any Owner, family member, lessee or guest. Owners may not park vehicles in spaces designated for handicapped persons, unless they fall within this category of individuals, and the Association or Management Company shall have the right to notify local authorities of any such violations. Vehicles should be parked within the painted lines. Parking will be limited as follows: (a) Each unit shall have access to one (1) parking space. (b) Each two (2) bedroom lockout unit, if split, shall have access to two (2) parking spaces. There shall be no reserved parking. Owners, members or guests violating the parking limitation shall be subject to having additional vehicles towed. 20. GUESTS Owners shall notify the Management Company in advance by written notice of the arrival and departure dates of guests who have permission to occupy the Unit in their absence. Owners should have such guests check in at the front desk of the Association or Management Company upon arrival in order that service can be extended to them. Owners will be responsible for compliance by guests with these Condominium Rules and Regulations. 21. TRANSFER. LEASE OR EXCHANGES OF UNITS OR UNIT WEEKS Upon any permitted transfer of any interest in a whole Unit or Unit Week, an Owner shall give written notice to the Management Company within 15 days of the date of the transfer to an individual, by registered or certified mail. Any transfer by an Owner to a Corporation or LLC shall abide by, and be in compliance with, the Association Adopted Property Transfer Requirements for Corporations and LLCs. The foregoing written notice shall state the name and address of the transferee and shall be accompanied by a nonrefundable administrative fee of FIFTY DOLLARS ($50.00) for individual transfers and One Hundred and Twenty- Five Dollars ($125.00) for Corporation and LLC transfers to cover administrative expenses. The notice should also be accompanied by a copy of the recorded deed or other evidence of title being vested in the new Owner. The transfer of interests in the Condominium is subject to those restrictions contained in the Declaration of Condominium,, and as amended per the Board of Directors. Any lease of a Unit or Unit Week shall contain a covenant stating that the lessee shall comply with all present and future Rules and Regulations of the Association, and lessees shall not be permitted to bring a pet of any kind onto the Condominium or Association Property or facilities leased by or licensed to the Association. Persons entitled to use of a Unit pursuant to an approved exchange program or through some other means must comply with these Rules and Regulations, as amended from time to time. Page 9

15 22. USE OF RECREATIONAL FACILITIES Owners and authorized users of the recreational facilities do so at their own risk. All users are required to obey the posted rules. Children under twelve (12) years of age using any recreational facilities must be accompanied and supervised by a responsible adult. Owners and authorized users shall observe all posted Condominium Rules and Regulations governing the use of all available recreational facilities. 23. STORAGE OF DANGEROUS ITEMS No inflammable, combustible, or explosive fluid, chemical or substance, shall be kept in any Unit or Limited Common Element except as are required for normal household use. 24. OCCUPANCY Unit occupancy shall be a maximum of four (4) occupants for a studio and a one (1) bedroom Unit and a maximum of six (6) occupants for a two (2) bedroom Unit, at any one time, unless modified by the prior written approval of the Association or Management Company. 25. WEAPONS No explosives, firearms, knives and/or fireworks shall be kept in any Unit and/or brought onto the Condominium Property at any time. 26. EMPLOYEES/AGENTS CONTROL AND ENTRY OF UNITS FOR MAINTENANCE Employees and/or agents of the Association or Management Company, and employees and/or agents of the Developer during the Developer's ongoing sales program, shall not be sent off the Condominium premises by any Owner or authorized user of a Unit at any time for any reason. No Owner or resident shall direct, supervise or in any manner attempt to assert any control over the employees of the Management Company or the Association. Employees or agents of the Management Company shall be permitted to enter Units for maintenance and repairs during reasonable hours. 27. COMPLAINTS Complaints regarding the services of the Condominium shall be made in writing to the Management Company, as long as a Management Contract remains in effect, and thereafter, to the Board of Directors. 28. PAYMENT OF ASSESSMENT FEES, SPECIAL CHARGES AND FINES Payment of assessment fees, special charges, and fines shall be made at the office of the Management Company, as designated in the Management Contract. Payments made in the form of checks shall be made to the order of such party as the Management Company shall designate. 29. CHECK-IN/CHECK-OUT OF TIME-SHARE UNITS All Owners of Unit Weeks or their authorized users shall vacate Units no later than 10:00 A.M. on the last day of their use period. In addition to all other remedies provided in the Declaration of Condominium and Bylaws, failure to vacate by 10:00 A.M. will subject the Owner(s) and/or authorized user(s) to an administrative fee of $ per day. Possession of a Unit shall not begin before 4:00 P.M. on the day on which the use period commences, unless permitted in writing by the Association or Management Company in its sole discretion. Each Owner or their authorized users shall return all keys to the Unit possessed at the end of their use period. There will be a $5.00 charge for each unreturned key. Beach towels will be placed in each unit, prior to check-in, in accordance with the occupancy limit detailed. A charge of $5.00 for each towel will be charged to the owner if the same number of towels are not returned at the time of check-out. Please feel free to swap out your towels for clean towels at any time during your stay. 30. NO SMOKING POLICY Effective 2011, no owner, family member, tenant, resident, guest, business invitee, or visitor shall smoke cigarettes, cigars, or any other tobacco product within the vacation unit. Smoking will only be permitted on the balcony area of each unit. If found that an Owner and/or Guest has violated this policy a fine of $150 for a professional cleaning of the unit will be charged to the Owner and/or Guest who is registered at the Resort. If the next occupant to this unit must be relocated due to the smoke smell, the previous occupant will also be charged for any additional fees that may be incurred by the relocation. 31. AMENDMENTS TO RULES The Board of Directors of the Association reserves the right to make additional rules and regulations as may be required from time to time without consent of its owners. These additional rules and regulations shall be binding as all other Condominium Rules and Regulations previously adopted. Page 10

16 Spinnaker Resorts PRIVACY ASSURANCE POLICY Spinnaker Resorts, and each of our affiliates, respects the confidential nature of both your personal and account information. To ensure your privacy, we have, and will continue to safeguard the information with which we are entrusted. Below, we have outlined the type of information that is typically collected from our owners and how this information is used. Please read this policy carefully and be assured of our commitment to safeguard the privacy policy rights of our owners. I. Type of personal information collected Information typically obtained for the purchase of property, from your purchase contract, credit application and other paperwork includes: your name, address, telephone number, social security number, employment, income, bank account information and monthly payment liability. Information obtained from third parties, as part of the purchase process, include credit reports and bank account information necessary to maintain your account. Information is also received from our regular transactions and experiences, which help us maintain the accuracy of your account information. II. Sharing your personal information We DO NOT share personal information on present or former customers with any nonaffiliated third parties, who are not directly involved in the process of handling or servicing your purchase. We do share your information with our title company to secure your title policy; and with our financial institution, as part of the mortgage servicing and collection process. We also use information for our own (internal) marketing programs. We DO NOT SELL your name, address or telephone number to any unaffiliated third parties. Here at Spinnaker Resorts, your personal information is private and is used to help us make your vacation ownership experience the best that it can be. III. Control of your personal information Spinnaker Resorts, and its affiliated companies, safeguard your information, both physically and electronically. Only parties with proper authority are permitted access to your personal information. All employees and related parties are required to adhere to the company s Privacy Assurance Policy and violations would result in disciplinary action. IV. Your right to "Opt Out" While Spinnaker Resorts does not presently share personal information with non-affiliated third parties, or have any plans to do so. you have the option to "opt out", please contact us at to notify us of your choice. We will process your request within thirty (30) days and maintain this information on file until we receive further direction from you. While we may, as permitted by federal law, continue to share information such as your account history and balance with affiliates of the company, no information will be shared with nonaffiliated parties. While our Privacy Assurance Policy is designed for the primary signatory on each account, we honor the opt out request of all joint signatories, as well. ( If one signatory on an account "opts out", the entire account will be coded accordingly. ) We thank you for choosing Spinnaker Resorts to provide you and your family with a lifetime of vacation experiences. You may be assured that your personal information is properly safeguarded. Page 11