Florida Senate - 2003 CS for CS for SB 2534 By the Committees on Comprehensive Planning; Regulated Industries; and Senator Webster 316-2462-03 1 A bill to be entitled 2 An act relating to timeshare plans; amending s. 3 721.02, F.S.; revising provisions with respect 4 to legislative purpose under the Florida 5 Vacation Plan and Timesharing Act; amending s. 6 721.03, F.S.; revising provisions with respect 7 to the scope of the act to include reference to 8 personal property timeshare plans; amending s. 9 721.05, F.S.; providing definitions; amending 10 s. 721.06, F.S.; revising provisions with 11 respect to contracts for purchase of timeshare 12 interests to include provisions with respect to 13 personal property timeshare interests; amending 14 s. 721.065, F.S.; revising provisions with 15 respect to resale purchase agreements to 16 include reference to certain real property and 17 personal property timeshare plans; amending s. 18 721.07, F.S.; revising provisions with respect 19 to public offering statements; amending s. 20 721.075, F.S.; revising provisions with respect 21 to incidental benefits, requiring purchasers to 22 execute a statement indicating the source of 23 the benefit; amending s. 721.08, F.S.; revising 24 provisions with respect to escrow accounts; 25 amending s. 721.09, F.S.; revising provisions 26 with respect to reservation agreements; 27 amending s. 721.11, F.S.; revising provisions 28 with respect to advertising materials; 29 correcting cross-references; amending s. 30 721.12, F.S.; providing for required 31 recordkeeping by the seller of a personal 1 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 property timeshare plan; amending s. 721.13, 2 F.S.; revising provisions with respect to 3 management; amending s. 721.14, F.S.; providing 4 that a section of law governing the discharge 5 of the managing entity shall not apply with 6 respect to personal property timeshare plans; 7 amending s. 721.15, F.S.; revising provisions 8 with respect to assessments for common 9 expenses; amending s. 721.16, F.S.; providing 10 that a section of law governing certain liens 11 does not apply to personal property timeshare 12 plans; amending s. 721.17, F.S.; revising 13 provisions with respect to transfer of 14 interest; amending s. 721.18, F.S.; revising 15 provisions with respect to exchange programs; 16 amending s. 721.19, F.S.; including reference 17 to personal property timeshare interests; 18 amending s. 721.20, F.S., relating to licensing 19 requirements; providing for the application of 20 certain provisions to personal property 21 timeshare plans; amending s. 721.24, F.S.; 22 exempting accommodations and facilities of 23 personal property timeshare plans from a 24 provision of law governing firesafety; amending 25 s. 721.26, F.S.; revising provisions with 26 respect to regulation by the division; amending 27 s. 721.52, F.S.; redefining the term "multisite 28 timeshare plan" and defining the terms 29 "nonspecific multisite timeshare plan" and 30 "specific multisite timeshare plan"; amending 31 s. 721.53, F.S.; revising provisions with 2 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 respect to subordination instruments; amending 2 s. 721.54, F.S.; deleting a cross-reference; 3 amending s. 721.55, F.S.; providing reference 4 to filed rather than registered public offering 5 statements; providing reference to multisite 6 timeshare plans; amending s. 721.551, F.S.; 7 providing for reference to filed rather than 8 registered public offering statements; amending 9 s. 721.552, F.S.; providing reference to 10 multisite timeshare plans; amending s. 721.56, 11 F.S.; providing reference to personal property 12 timeshare plans; amending s. 721.57, F.S.; 13 revising provisions with respect to timeshare 14 estates in multisite timeshare plans; amending 15 s. 721.84, F.S.; revising provisions with 16 respect to appointment of a registered agent; 17 amending ss. 721.96 and 721.97, F.S.; including 18 reference to personal property timeshare 19 interests; providing for application with 20 respect to certain filings approved by the 21 Division of Florida Land Sales, Condominiums, 22 and Mobile Homes prior to the effective date of 23 the act; providing an effective date. 24 25 Be It Enacted by the Legislature of the State of Florida: 26 27 Section 1. Subsections (1) and (5) of section 721.02, 28 Florida Statutes, are amended to read: 29 721.02 Purposes.--The purposes of this chapter are to: 30 31 3 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (1) Give statutory recognition to real property 2 timeshare plans timesharingand personal property timeshare 3 planstimesharingin thisthestate. 4 (5) Recognize that the tourism industry in this state 5 is a vital part of the state's economy; that the sale, 6 promotion, and use of timeshare plans is an emerging, dynamic 7 segment of the tourism industry; that this segment of the 8 tourism industry continues to grow, both in volume of sales 9 and in complexity and variety of product structure; and that a 10 uniform and consistent method of regulation is necessary in 11 order to safeguard Florida's tourism industry and the state's 12 economic well-being. In order to protect the quality of 13 Florida timeshare plans and the consumers who purchase them, 14 it is the intent of the Legislature that this chapter be 15 interpreted broadly in order to encompass all forms of 16 timeshare plans with a duration of at least 3 years that are 17 created with respect to accommodations and facilities that are 18 located in the state or that are offered for sale in the state 19 as provided herein, including, but not limited to, 20 condominiums, cooperatives, undivided interest campgrounds, 21 cruise ships, vessels, houseboats, recreational vehicles and 22 other motor vehicles, and including vacation clubs, multisite 23 vacation plans, and multiyear vacation and lodging 24 certificates. 25 Section 2. Paragraph (d) is added to subsection (1) of 26 section 721.03, Florida Statutes, and subsection (8) of that 27 section, is amended to read: 28 721.03 Scope of chapter.-- 29 (1) This chapter applies to all timeshare plans 30 consisting of more than seven timeshare periods over a period 31 of at least 3 years in which the accommodations and 4 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 facilities, if any, are located within this state or offered 2 within this state; provided that: 3 (d) For purposes of determining the term of the plan, 4 the period of any automatic renewals shall be included, except 5 as provided in s. 721.52(4)(b). 6 (8) With respect to any personal property 7 accommodation or facility of atimeshare plan:which is8situated upon9 (a) This chapter applies only to personal property 10 timeshare plans that are offered in this state.,11 (b) The division shall have the authority to adopt 12 rules interpreting and implementing the provisions of this 13 chapter as they apply to any personal property timeshare plan 14 or anysuchaccommodation or facility that is part of a 15 personal property timeshare plan offered in this state, or as 16 the provisions of this chaptertheyapply to any other laws of 17 this state, of the several states,orof the United States, or 18 of any other jurisdiction, with respect to any personal 19 property timeshare plan or anysuchaccommodation or facility 20 that is part of a personal property timeshare plan offered in 21 this state. 22 (c) Any developer and any managing entity of a 23 personal property timeshare plan must submit to personal 24 jurisdiction in this state in a form satisfactory to the 25 division at the time of filing a public offering statement. 26 Section 3. Section 721.05, Florida Statutes, is 27 amended to read: 28 721.05 Definitions.--As used in this chapter, the 29 term: 30 (1) "Accommodation" means any apartment,condominium 31 or cooperative unit, cabin, lodge, hotel or motel room, 5 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 campground, cruise ship cabin, houseboat or other vessel, 2 recreational or other motor vehicle, or any or otherprivate 3 or commercial structure which issituated onreal or personal 4 property and designed for overnight occupancyor useby one or 5 more individuals. The term does not include an incidental 6 benefit as defined in this section. 7 (2) "Agreement for deed" means any written contract 8 utilized in the sale of timeshare estates which provides that 9 legal title will not be conveyed to the purchaser until the 10 contract price has been paid in full and the terms of payment 11 of which extend for a period in excess of 180 days after 12 either the date of execution of the contract or completion of 13 construction, whichever occurs later. 14 (3) "Agreement for transfer" means any written 15 contract utilized in the sale of personal property timeshare 16 interests which provides that legal title will not be 17 transferred to the purchaser until the contract price has been 18 paid in full and the terms of payment of which extend for a 19 period in excess of 180 days after either the date of 20 execution of the contract or completion of construction, 21 whichever occurs later. 22 (4)(3)"Assessment" means the share of funds required 23 for the payment of common expenses which is assessed from time 24 to time against each purchaser by the managing entity. 25 (5)(4)"Closing" means: 26 (a) For any plan selling timeshare estates, conveyance 27 of the legal or beneficial title to a timeshare estate as 28 evidenced by the delivery of a deed for conveyance of legal 29 title, or other instrument for conveyance of beneficial title, 30 to the purchaser or to the clerk of the court for recording or 31 conveyance of the equitable title to a timeshare estate as 6 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 evidenced by the irretrievable delivery of an agreement for 2 deed to the clerk of the court for recording. 3 (b) For any plan selling timeshare licenses or 4 personal property timeshare interests, the final execution and 5 delivery by all parties of the last document necessary for 6 vesting in the purchaser the full rights available under the 7 plan. 8 (6) (5)"Common expenses" means: 9 (a) Those expenses, fees, or taxes properly incurred 10 for the maintenance, operation, and repair of the 11 accommodations or facilities, or both, constituting the 12 timeshare plan. 13 (b) Any other expenses, fees, or taxes designated as 14 common expenses in a timeshare instrument. 15 (c) Any past due and uncollected ad valorem taxes 16 assessed against a timeshare development pursuant to s. 17 192.037. 18 (7)(6)"Completion of construction" means: 19 (a)1. That a certificate of occupancy has been issued 20 for the entire building in which the timeshare unit being sold 21 is located, or for the improvement, or that the equivalent 22 authorization has been issued, by the governmental body having 23 jurisdiction;or24 2. In a jurisdiction in which no certificate of 25 occupancy or equivalent authorization is issued, that the 26 construction, finishing, and equipping of the building or 27 improvements according to the plans and specifications have 28 been substantially completed; or 29 3. With respect to personal property timeshare plans, 30 that all accommodations have been manufactured or built and 31 acquired or leased by the developer, owners' association, 7 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 managing entity, trustee, or other person for the use of 2 purchasers as set forth in the timeshare instrument; and 3 (b) That all accommodations and facilities of the 4 timeshare plan are available for use in a manner identical in 5 all material respects to the manner portrayed by the 6 promotional material, advertising, and filed registeredpublic 7 offering statements. 8 (8)(7)"Conspicuous type" means: 9 (a) Type in upper and lower case letters two point 10 sizes larger than the largest nonconspicuous type, exclusive 11 of headings, on the page on which it appears but in at least 12 10-point type; or 13 (b) Where the use of 10-point type would be 14 impractical or impossible with respect to a particular piece 15 of written advertising material, a different style of type or 16 print may be used, so long as the print remains conspicuous 17 under the circumstances. 18 19 Where conspicuous type is required, it must be separated on 20 all sides from other type and print. Conspicuous type may be 21 utilized in contracts for purchase or public offering 22 statements only where required by law or as authorized by the 23 division. 24 (9)(8)"Contract" means any agreement conferring the 25 rights and obligations of a timeshare plan on the purchaser. 26 (10)(9)"Developer" includes: 27 (a) A "creating developer," which means any person who 28 creates the timeshare plan; 29 (b) A "successor developer," which means any person 30 who succeeds to the interest of the persons in this subsection 31 by sale, lease, assignment, mortgage, or other transfer, but 8 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 the term includes only those persons who offer timeshare 2 interests in the ordinary course of business; and 3 (c) A "concurrent developer," which means any person 4 acting concurrently with the persons in this subsection with 5 the purpose of offering timeshare interests in the ordinary 6 course of business. 7 (d) The term "developer" does not include: 8 1. An owner of a timeshare interest who has acquired 9 the timeshare interest for his or her own use and occupancy 10 and who later offers it for resale; provided that a rebuttable 11 presumption shall exist that an owner who has acquired more 12 than seven timeshare interests did not acquire them for his or 13 her own use and occupancy; 14 2. A managing entity, not otherwise a developer, that 15 offers, or engages a third party to offer on its behalf, 16 timeshare interests in a timeshare plan which it manages, 17 provided that such offer complies with the provisions of s. 18 721.065; 19 3. A person who owns or is conveyed, assigned, or 20 transferred more than seven timeshare interests and who 21 subsequently conveys, assigns, or transfers all acquired 22 timeshare interests to a single purchaser in a single 23 transaction, which transaction may occur in stages; or 24 4. A person who has acquired or has the right to 25 acquire more than seven timeshare interests from a developer 26 or other interestholder in connection with a loan, 27 securitization, conduit, or similar financing arrangement 28 transaction and who subsequently arranges for all or a portion 29 of the timeshare interests to be offered by one or more 30 developers in the ordinary course of business on their own 31 behalves or on behalf of such person. 9 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (e) A successor or concurrent developer shall be 2 exempt from any liability inuring to a predecessor or 3 concurrent developer of the same timeshare plan, except as 4 provided in s. 721.15(7), provided that this exemption shall 5 not apply to any of the successor or concurrent developer's 6 responsibilities, duties, or liabilities with respect to the 7 timeshare plan that accrue after the date the successor or 8 concurrent developer became a successor or concurrent 9 developer, and provided that such transfer does not constitute 10 a fraudulent transfer. In addition to other provisions of law, 11 a transfer by a predecessor developer to a successor or 12 concurrent developer shall be deemed fraudulent if the 13 predecessor developer made the transfer: 14 1. With actual intent to hinder, delay, or defraud any 15 purchaser or the division; or 16 2. To a person that would constitute an insider under 17 s. 726.102(7). 18 19 The provisions of this paragraph shall not be construed to 20 relieve any successor or concurrent developer from the 21 obligation to comply with the provisions of any applicable 22 timeshare instrument. 23 (11) (10)"Division" means the Division of Florida Land 24 Sales, Condominiums, and Mobile Homes of the Department of 25 Business and Professional Regulation. 26 (12)(11)"Enrolled" means paid membership in an 27 exchange program or membership in an exchange program 28 evidenced by written acceptance or confirmation of membership. 29 (13)(12)"Escrow account" means an account established 30 solely for the purposes set forth in this chapter with a 31 financial institution located within this state. 10 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (14) (13)"Escrow agent" includes only: 2 (a) A savings and loan association, bank, trust 3 company, or other financial institution, any of which must be 4 located in this state and any of which must have a net worth 5 in excess of $5 million; 6 (b) An attorney who is a member of The Florida Bar or 7 his or her law firm; 8 (c) A real estate broker who is licensed pursuant to 9 chapter 475 or his or her brokerage firm; or 10 (d) A title insurance agent that is licensed pursuant 11 to s. 626.8417, a title insurance agency that is licensed 12 pursuant to s. 626.8418, or a title insurer authorized to 13 transact business in this state pursuant to s. 624.401. 14 (15)(14)"Exchange company" means any person owning or 15 operating, or owning and operating, an exchange program. 16 (16)(15)"Exchange program" means any method, 17 arrangement, or procedure for the voluntary exchange of the 18 right to use and occupy accommodations and facilities among 19 purchasers. The term does not include the assignment of the 20 right to use and occupy accommodations and facilities to 21 purchasers pursuant to a particular multisite timeshare plan's 22 reservation system. Any method, arrangement, or procedure that 23 otherwise meets this definition, wherein the purchaser's total 24 contractual financial obligation exceeds $3,000 per any 25 individual, recurring timeshare period, shall be regulated as 26 a multisite timeshare plan in accordance with part II. 27 (17)(16)"Facility" means any amenity, including any 28 structure, furnishing, fixture, equipment, service, 29 improvement, or real or personal property, improved or 30 unimproved, other than antheaccommodation of the timeshare 31 plan, which is made available to the purchasers of a timeshare 11 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 plan. The term does not include an incidental benefit as 2 defined in this section. 3 (18) "Filed public offering statement" means a public 4 offering statement that has been filed with the division 5 pursuant to s. 721.07(5) or s. 721.55. 6 (19) (17)"Incidental benefit" means an accommodation, 7 product, service, discount, or other benefit which is offered 8 to a prospective purchaser of a timeshare plan or to a 9 purchaser of a timeshare plan prior to the expiration of his 10 or her initial 10-day voidability period pursuant to s. 11 721.10; which is not an exchange program as defined in 12 subsection (16)(15); and which complies with the provisions 13 of s. 721.075. The term shall not include an offer of the use 14 of the accommodations and facilities of the timeshare plan on 15 a free or discounted one-time basis. 16 (20)(18)"Independent," for purposes of determining 17 eligibility of escrow agents and trustees pursuant to s. 18 721.03(7), means that: 19 (a) The escrow agent or trustee is not a relative, as 20 described in s. 112.3135(1)(d), or an employee of the 21 developer, seller, or managing entity, or of any officer, 22 director, affiliate, or subsidiary thereof. 23 (b) There is no financial relationship, other than the 24 payment of fiduciary fees or as otherwise provided in this 25 subsection, between the escrow agent or trustee and the 26 developer, seller, or managing entity, or any officer, 27 director, affiliate, or subsidiary thereof. 28 (c) Compensation paid by the developer to an escrow 29 agent or trustee for services rendered shall not be paid from 30 funds in the escrow or trust account unless and until the 31 developer is otherwise entitled to receive the disbursement of 12 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 such funds from the escrow or trust account pursuant to this 2 chapter. 3 (d) A person shall not be disqualified to serve as an 4 escrow agent or a trustee solely because of the following: 5 1. A nonemployee, attorney-client relationship exists 6 between the developer and the escrow agent or trustee; 7 2. The escrow agent or trustee provides brokerage 8 services as defined by chapter 475 for the developer; 9 3. The escrow agent or trustee provides the developer 10 with routine banking services which do not include 11 construction or receivables financing or any other lending 12 activities; or 13 4. The escrow agent or trustee performs closings for 14 the developer or seller or issues owner's or lender's title 15 insurance commitments or policies in connection with such 16 closings. 17 (21) (19)"Interestholder" means a developer, an owner 18 of the underlying fee or owner of the underlying personal 19 property, a mortgagee, judgment creditor, or other lienor, or 20 any other person having an interest in or lien or encumbrance 21 against the accommodations or facilities of the timeshare 22 plan. 23 (22)(20)"Managing entity" means the person who 24 operates or maintains the timeshare plan pursuant to s. 25 721.13(1). 26 (23)(21)"Memorandum of agreement" means a written 27 document, in arecordableform sufficient to permit the 28 document to be recorded or otherwise filed in the appropriate 29 public records and to provide constructive notice of its 30 contents under applicable law, which includes the names of the 31 seller and the purchasers, a legal description of the 13 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 timeshare property, or other sufficient description for a 2 personal property timeshare plan, and all timeshare interests 3 to be included in such document, and a description of the type 4 of timeshare interest licensesold by the seller. 5 (24)(22)"Offer to sell," "offer for sale," "offered 6 for sale," or "offer" means the solicitation, advertisement, 7 or inducement, or any other method or attempt, to encourage 8 any person to acquire the opportunity to participate in a 9 timeshare plan. 10 (25)(23)"One-to-one purchaser to accommodation ratio" 11 means the ratio of the number of purchasers eligible to use 12 the accommodations of a timeshare plan on a given day to the 13 number of accommodations available for use within the plan on 14 that day, such that the total number of purchasers eligible to 15 use the accommodations of the timeshare plan during a given 16 calendar year never exceeds the total number of accommodations 17 available for use in the timeshare plan during that year. For 18 purposes of calculation under this subsection, each purchaser 19 must be counted at least once, and no individual timeshare 20 unit may be counted more than 365 times per calendar year (or 21 more than 366 times per leap year). A purchaser who is 22 delinquent in the payment of timeshare plan assessments shall 23 continue to be considered eligible to use the accommodations 24 of the timeshare plan for purposes of this subsection 25 notwithstanding any application of s. 721.13(6). 26 (26)(24)"Owner of the underlying fee" or "owner of 27 the underlying personal property" means any person having an 28 interest in the real property or personal property comprising 29 or underlying the accommodations or facilities of athe30 timeshare plan at or subsequent to the time of creation of the 31 timeshare plan. 14 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (27) (25)"Owners' association" means anthe2 association made up of all owners of timeshare interests in a 3 timeshare plan, including developers and purchasers of sucha4 timeshare planwho have purchased timeshare estates. 5 (28) "Personal property timeshare interest" means a 6 right to occupy an accommodation located on or in or comprised 7 of personal property that is not permanently affixed to real 8 property, whether or not coupled with a beneficial or 9 ownership interest in the accommodations or personal property. 10 (29)(26)"Public offering statement" means the written 11 materials describing a single-site timeshare plan or a 12 multisite timeshare plan, including a text and any exhibits 13 attached thereto as required by ss. 721.07, 721.55, and 14 721.551. The term "public offering statement" shall refer to 15 both a filedregisteredpublic offering statement and a 16 purchaser public offering statement. 17 (30)(27)"Purchaser" means any person, other than a 18 developer, who by means of a voluntary transfer acquires a 19 legal or equitable interest in a timeshare plan other than as 20 security for an obligation. 21 (31)(28)"Purchaser public offering statement" means 22 that portion of the filedregisteredpublic offering statement 23 which must be delivered to purchasers pursuant to s. 721.07(6) 24 or s. 721.551. 25(29) "Registered public offering statement" means a26public offering statement which has been filed with the27division pursuant to s. 721.07(5) or s. 721.55.28 (32)(30)"Regulated short-term product" means a 29 contractual right, offered by the seller, to use 30 accommodations of a timeshare plan or other accommodations, 31 provided that: 15 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (a) The agreement to purchase the short-term right to 2 use is executed in this state on the same day that the 3 prospective purchaser receives an offer to acquire an interest 4 in a timeshare plan and does not execute a purchase contract, 5 after attending a sales presentation; and 6 (b) The acquisition of the right to use includes an 7 agreement that all or a portion of the consideration paid by 8 the prospective purchaser for the right to use will be applied 9 to or credited against the price of a future purchase of a 10 timeshare interest, or that the cost of a future purchase of a 11 timeshare interest will be fixed or locked in at a specified 12 price. 13 (33) (31)"Seller" means any developer or any other 14 person, or any agent or employee thereof, who offers timeshare 15 interests in the ordinary course of business. The term 16 "seller" does not include: 17 (a) An owner of a timeshare interest who has acquired 18 the timeshare interest for his or her own use and occupancy 19 and who later offers it for resale; provided that a rebuttable 20 presumption shall exist that an owner who has acquired more 21 than seven timeshare interests did not acquire them for his or 22 her own use and occupancy; 23 (b) A managing entity, not otherwise a seller, that 24 offers, or engages a third party to offer on its behalf, 25 timeshare interests in a timeshare plan which it manages, 26 provided that such offer complies with the provisions of s. 27 721.065; 28 (c) A person who owns or is conveyed, assigned, or 29 transferred more than seven timeshare interests and who 30 subsequently conveys, assigns, or transfers all acquired 31 16 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 timeshare interests to a single purchaser in a single 2 transaction, which transaction may occur in stages; or 3 (d) A person who has acquired or has the right to 4 acquire more than seven timeshare interests from a developer 5 or other interestholder in connection with a loan, 6 securitization, conduit, or similar financing arrangement and 7 who subsequently arranges for all or a portion of the 8 timeshare interests to be offered by one or more developers in 9 the ordinary course of business on their own behalves or on 10 behalf of such person. 11 (34) (32)"Timeshare estate" means a right to occupy a 12 timeshare unit, coupled with a freehold estate or an estate 13 for years with a future interest in a timeshare property or a 14 specified portion thereof. The term shall also mean an 15 interest in a condominium unit pursuant to s. 718.103, an 16 interest in a cooperative unit pursuant to s. 719.103, or an 17 interest in a trust that complies in all respects with the 18 provisions of s. 721.08(2)(c)4.3., provided that the trust 19 does not contain any personal property timeshare interests. A 20 timeshare estate is a parcel of real property under the laws 21 of this state. 22 (35)(33)"Timeshare instrument" means one or more 23 documents, by whatever name denominated, creating or governing 24 the operation of a timeshare plan. 25 (36)(34)"Timeshare interest" means a timeshare 26 estate, a personal property timeshare interest, or a timeshare 27 license. 28 (37)(35)"Timeshare license" means a right to occupy a 29 timeshare unit, which right is not a personal property 30 timeshareneither coupled with a freeholdinterest or a 31 17 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 timeshare , nor coupled with anestatefor years with a future2interest, in a timeshare property. 3 (38)(36)"Timeshare period" means the period or 4 periods of time when a purchaser of a timeshare interest is 5 afforded the opportunity to use the accommodationsor6facilities, or both,of a timeshare plan. 7 (39)(37)"Timeshare plan" means any arrangement, plan, 8 scheme, or similar device, other than an exchange program, 9 whether by membership, agreement, tenancy in common, sale, 10 lease, deed, rental agreement, license, or right-to-use 11 agreement or by any other means, whereby a purchaser, for 12 consideration, receives ownership rights in or a right to use 13 accommodations, and facilities, if any, for a period of time 14 less than a full year during any given year, but not 15 necessarily for consecutive years. The term "timeshare plan" 16 includes: 17 (a) A "personal property timeshare plan," which means 18 a timeshare plan in which the accommodations are comprised of 19 personal property that is not permanently affixed to real 20 property; and 21 (b) A "real property timeshare plan," which means a 22 timeshare plan in which the accommodations of the timeshare 23 plan are comprised of or permanently affixed to real property. 24 (40)(38)"Timeshare property" means one or more 25 timeshare units subject to the same timeshare instrument, 26 together with any other property or rights to property 27 appurtenant to those timeshare units. Notwithstanding anything 28 to the contrary contained in chapter 718 or chapter 719, the 29 timeshare instrument for a timeshare condominium or 30 cooperative may designate personal property, contractual 31 rights, affiliation agreements of component sites of vacation 18 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 clubs, exchange companies, or reservation systems, or any 2 other agreements or personal property, as common elements or 3 limited common elements of the timeshare condominium or 4 cooperative. 5 (41) (39)"Timeshare unit" means an accommodation of a 6 timeshare plan which is divided into timeshare periods. Any 7 timeshare unit in which a door or doors connecting two or more 8 separate rooms are capable of being locked to create two or 9 more private dwellings shall only constitute one timeshare 10 unit for purposes of this chapter, unless the timeshare 11 instrument provides that timeshare interests may be separately 12 conveyed in such locked-off portions. 13(40) "Vacation ownership plan" means any timeshare14plan consisting exclusively of timeshare estates.15(41) "Vacation plan" or "vacation membership plan"16means any timeshare plan consisting exclusively of timeshare17licensesor consisting of a combination of timeshare licenses18and timeshare estates.19 Section 4. Section 721.06, Florida Statutes, is 20 amended to read: 21 721.06 Contracts for purchase of timeshare 22 interests.-- 23 (1) Each seller shall utilize and furnish each 24 purchaser a fully completed and executed copy of a contract 25 pertaining to the sale, which contract shall include the 26 following information: 27 (a) The actual date the contract is executed by each 28 party. 29 (b) The names and addresses of the developer and the 30 timeshare plan. 31 19 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (c) The initial purchase price and any additional 2 charges to which the purchaser may be subject in connection 3 with the purchase of the timeshare interest, such as 4 financing, or which will be collected from the purchaser on or 5 before closing, such as the current year's annual assessment 6 for common expenses. 7 (d)1. For real property timeshare plans, an estimate 8 of any anticipated annual assessment stated on an Anyannually 9 recurring basis for any use charges, fees,charge and the next10year's estimated annual assessment forcommon expenses, orand11forad valorem taxes or, if an estimatefor next year's12assessmentis unavailable, the current year's actual annual 13 assessment for any use charges, fees, common expenses, orand14forad valorem taxes. 15 2. For personal property timeshare plans, an estimate 16 of any anticipated annual assessment stated on an annually 17 recurring basis for any use charges, fees, common expenses, or 18 taxes or, if an estimate is unavailable, the current year's 19 actual annual assessment for any use charges, fees, common 20 expenses or taxes. 21 (e) The estimated date of completion of construction 22 of each accommodation or facility promised to be completed 23 which is not completed at the time the contract is executed 24 and the estimated date of closing. 25 (f) A brief description of the nature and duration of 26 the timeshare interest being sold, including whether any 27 interest in real property or personal property is being 28 conveyed and the specific number of years constituting the 29 term of the timeshare plan. 30 31 20 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (g) Immediately prior to the space reserved in the 2 contract for the signature of the purchaser, in conspicuous 3 type, substantially the following statements: 4 1. If the purchaser will receive a personal property 5 timeshare interest: 6 a. This personal property timeshare plan is governed 7 only by limited sections of the timeshare management 8 provisions of Florida law. 9 b. If the accommodations or facilities are located on 10 or in a documented vessel or foreign vessel as provided in s. 11 721.08(2)(c)3.e., the disclosure required by s. 12 721.08(2)(c)3.e.IV. 13 2. You may cancel this contract without any penalty or 14 obligation within 10 calendar days after the date you sign 15 this contract or the date on which you receive the last of all 16 documents required to be given to you pursuant to s. 17 721.07(6), Florida Statutes, whichever is later. If you decide 18 to cancel this contract, you must notify the seller in writing 19 of your intent to cancel. Your notice of cancellation shall be 20 effective upon the date sent and shall be sent to ... (Name 21 of Seller) ... at ... (Address of Seller) .... Any attempt 22 to obtain a waiver of your cancellation right is void and of 23 no effect. While you may execute all closing documents in 24 advance, the closing, as evidenced by delivery of the deed or 25 other document, before expiration of your 10-day cancellation 26 period, is prohibited. 27 (h) If a timeshare estate is being conveyed, the 28 following statement in conspicuous type: 29 30 For the purpose of ad valorem assessment, taxation and 31 special assessments, the managing entity will be considered 21 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 the taxpayer as your agent pursuant to section 192.037, 2 Florida Statutes. 3 4 (i) A statement that, in the event the purchaser 5 cancels the contract during a 10-day cancellation period, the 6 developer will refund to the purchaser the total amount of all 7 payments made by the purchaser under the contract, reduced by 8 the proportion of any contract benefits the purchaser has 9 actually received under the contract prior to the effective 10 date of the cancellation. The statement shall further provide 11 that the refund will be made within 20 days after receipt of 12 notice of cancellation or within 5 days after receipt of funds 13 from the purchaser's cleared check, whichever is later. A 14 seller and a purchaser shall agree in writing on a specific 15 value for each contract benefit received by the purchaser for 16 purposes of this paragraph. The term "contract benefit" shall 17 not include purchaser public offering statements or other 18 documentation or materials that must be furnished to a 19 purchaser pursuant to statute or rule. 20 (j) If the timeshare interest is being sold pursuant 21 to an agreement for deed or an agreement for transfer, a 22 statement that the signing of the agreement for deed or 23 agreement for transfer does not entitle the purchaser to 24 receive the conveyance or transfer of his or her timeshare 25 estate or personal property timeshare interest a deeduntil 26 all payments under the agreement have been made. 27 (k) Unless the developer is, at the time of offering 28 the plan, the ownerin fee simple absoluteof the 29 accommodations and facilities of the timeshare plan, free and 30 clear of all liens,andencumbrances, and claims of other 31 interestholders, a statement that the developer is not the 22 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 sole owner of the underlying fee or owner of the underlying 2 personal property or that the suchaccommodations or 3 facilities are subject towithoutliens or encumbrances, which 4 statement shall include: 5 1. The names and addresses of all other 6 interestholderspersons or entities having an ownership7interest or other interest in the accommodations or8facilities; and 9 2. The actual interest of the developer in the 10 accommodations or facilities. As an alternative to including 11 the statement in the purchase contract, a seller may include a 12 reference in the purchase contract to the location in the 13 purchaser public offering statement text of such information. 14 (l) If the purchaser will receive an interest in a 15 multisite timeshare plan pursuant to part II, a statement 16 shall be provided in conspicuous type in substantially the 17 following form: 18 19 The developer is required to provide the managing 20 entity of the multisite timeshare plan with a copy of the 21 approved public offering statement text and exhibits filed 22 with the division and any approved amendments thereto, and any 23 other component site documents as described in section 721.07 24 or section 721.55, Florida Statutes, that are not required to 25 be filed with the division, to be maintained by the managing 26 entity for inspection as part of the books and records of the 27 plan. 28 29 (m) The following statement in conspicuous type: 30 31 23 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 Any resale of this timeshare interest must be 2 accompanied by certain disclosures in accordance with section 3 721.065, Florida Statutes. 4 5 (n) A description of any rights reserved by the 6 developer to alter or modify the offering prior to closing. 7 (2)(a) An agreement for deed shall be recorded by the 8 developer within 30 days after the day it is executed by the 9 purchaser. The developer shall pay all recording costs 10 associated therewith. A form copy of such instrument must be 11 filed with the division for review pursuant to s. 721.07. 12 (b) An agreement for transfer shall be filed with the 13 appropriate official responsible for maintaining such records 14 in the appropriate jurisdiction within 30 days after the day 15 it is executed by the purchaser. The developer shall pay all 16 filing costs associated therewith. A form copy of such 17 instrument must be filed with the division for review pursuant 18 to s. 721.07. 19 (3) The escrow agent shall provide the developer with 20 a receipt for all purchaser funds or other property received 21 by the escrow agent from a seller. 22 Section 5. Paragraph (b) of subsection (2) of section 23 721.065, Florida Statutes, is amended to read: 24 721.065 Resale purchase agreements.-- 25 (2) Any resale purchase agreement utilized by a person 26 described in subsection (1) must contain all of the following: 27 (b) One of the following statements in conspicuous 28 type located immediately prior to the disclosure required by 29 paragraph (c): 30 1. If the resale purchase agreement pertains to a real 31 property timeshare plan: 24 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 2 The current year's assessment for common expenses allocable to 3 the timeshare interest you are purchasing is $_____. This 4 assessment, which may be increased from time to time by the 5 managing entity of the timeshare plan, is payable in full each 6 year on or before __________. This assessment (includes/does 7 not include) yearly ad valorem real estate taxes, which 8 (are/are not) billed and collected separately. (If ad valorem 9 real property taxes are not included in the current year's 10 assessment for common expenses, the following statement must 11 be included: The most recent annual assessment for ad valorem 12 real estate taxes for the timeshare interest you are 13 purchasing is $_____.) (If there are any delinquent 14 assessments for common expenses or ad valorem taxes 15 outstanding with respect to the timeshare interest in 16 question, the following statement must be included: A 17 delinquency in the amount of $_____ for unpaid common expenses 18 or ad valorem taxes currently exists with respect to the 19 timeshare interest you are purchasing, together with a per 20 diem charge of $_____ for interest and late charges.) For the 21 purpose of ad valorem assessment, taxation, and special 22 assessments, the managing entity will be considered the 23 taxpayer as your agent pursuant to section 192.037, Florida 24 Statutes. Each owner is personally liable for the payment of 25 her or his assessments for common expenses, and failure to 26 timely pay these assessments may result in restriction or loss 27 of your use and/or ownership rights. 28 29 There are many important documents relating to the timeshare 30 plan which you should review prior to purchasing a timeshare 31 interest, including the declaration of condominium or 25 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 covenants and restrictions; the owners' association articles 2 and bylaws; the current year's operating and reserve budgets; 3 and any rules and regulations affecting the use of timeshare 4 plan accommodations and facilities. 5 2. If the resale purchase agreement pertains to a 6 personal property timeshare plan: 7 8 The current year's assessment for any common expenses, use 9 charges, fees, or taxes allocable to the timeshare interest 10 you are purchasing is $_____. This assessment, which may be 11 increased from time to time by the managing entity of the 12 timeshare plan, is payable in full each year on or before 13 __________. (If there are any delinquent assessments for 14 common expenses, use charges, fees, or taxes outstanding with 15 respect to the timeshare interest in question, the following 16 statement must be included: A delinquency in the amount of 17 $_____ for unpaid common expenses, use charges, fees, or taxes 18 currently exists with respect to the timeshare interest you 19 are purchasing, together with a per diem charge of $_____ for 20 interest and late charges.) Each owner is personally liable 21 for the payment of her or his assessments for common expenses, 22 and failure to timely pay these assessments may result in 23 restriction or loss of your use and/or ownership rights. 24 25 There are many important documents relating to the timeshare 26 plan which you should review prior to purchasing a timeshare 27 interest, including any owners association articles and 28 bylaws; the current year's operating and reserve budgets; and 29 any rules and regulations affecting the use of timeshare plan 30 accommodations and facilities. 31 26 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 Section 6. Section 721.07, Florida Statutes, is 2 amended to read: 3 721.07 Public offering statement.--Prior to offering 4 any timeshare plan, the developer must submit a filed 5 registeredpublic offering statement to the division for 6 approval as prescribed by s. 721.03, s. 721.55, or this 7 section. Until the division approves such filing, any contract 8 regarding the sale of that timeshare plan is subject to 9 cancellationvoidableby the purchaser pursuant to s. 721.10. 10 (1) The division shall, upon receiving a filed 11registeredpublic offering statement from a developer, mail to 12 the developer an acknowledgment of receipt. The failure of the 13 division to send such acknowledgment will not, however, 14 relieve the developer from the duty of complying with this 15 section. 16 (2)(a) Within 45 days after receipt of a filed 17registeredpublic offering statement which is subject only to 18 this part and is submitted in proper form as prescribed by 19 rule, or within 120 days after receipt of a filedregistered20 public offering statement which is subject to part II and is 21 submitted in proper form as prescribed by rule, the division 22 shall determine whether the proposed filedregisteredpublic 23 offering statement is adequate to meet the requirements of 24 this section and shall notify the developer by mail that the 25 division has either approved the statement or found specified 26 deficiencies in the statement. If the division fails to 27 approve the statement or specify deficiencies in the statement 28 within the period specified in this paragraph, the filing will 29 be deemed approved. 30 (b) If the developer fails to respond to any cited 31 deficiencies within 20 days after receipt of the division's 27 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 deficiency notice, the division may reject the filing. 2 Subsequent to such rejection, a new filing fee pursuant to 3 subsection (4) and a new division initial review period 4 pursuant to paragraph (a) shall apply to any refiling or 5 further review of the rejected filing. 6 (c) Within 20 days after receipt of the developer's 7 timely and complete response to any deficiency notice, the 8 division shall notify the developer by mail that the division 9 has either approved the filing, found additional specified 10 deficiencies in it, or determined that any previously 11 specified deficiency has not been corrected. If the division 12 fails to approve or specify additional deficiencies within 20 13 days after receipt of the developer's timely and complete 14 response, the filing will be deemed approved. 15 (d) A developer shall have the authority to deliver to 16 purchasers any purchaser public offering statement that is not 17 yet approved by the division, provided that the following 18 shall apply: 19 1. At the time the developer delivers an unapproved 20 purchaser public offering statement to a purchaser pursuant to 21 this paragraph, the developer shall deliver a fully completed 22 and executed copy of the purchase contract required by s. 23 721.06 that contains the following statement in conspicuous 24 type in substantially the following form which shall replace 25 the statements required by s. 721.06(1)(g): 26 27 The developer is delivering to you a public offering statement 28 that has been filed with but not yet approved by the Division 29 of Florida Land Sales, Condominiums, and Mobile Homes. Any 30 revisions to the unapproved public offering statement you have 31 received must be delivered to you, but only if the revisions 28 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 materially alter or modify the offering in a manner adverse to 2 you. After the division approves the public offering 3 statement, you will receive notice of the approval from the 4 developer and the required revisions, if any. 5 6 Your statutory right to cancel this transaction without any 7 penalty or obligation expires 10 calendar days after the date 8 you signed your purchase contract or the date on which you 9 receive the last of all documents required to be given to you 10 pursuant to section 721.07(6), Florida Statutes, or 10 11 calendar days after you receive revisions required to be 12 delivered to you, if any, whichever is later. If you decide to 13 cancel this contract, you must notify the seller in writing of 14 your intent to cancel. Your notice of cancellation shall be 15 effective upon the date sent and shall be sent to (Name of 16 Seller) at (Address of Seller). Any attempt to obtain a waiver 17 of your cancellation right is void and of no effect. While you 18 may execute all closing documents in advance, the closing, as 19 evidenced by delivery of the deed or other document, before 20 expiration of your 10-day cancellation period, is prohibited. 21 22 2. After receipt of approval from the division and prior to 23 closing, if any revisions made to the documents contained in 24 the purchaser public offering statement materially alter or 25 modify the offering in a manner adverse to a purchaser, the 26 developer shall send the purchaser such revisions together 27 with a notice containing a statement in conspicuous type in 28 substantially the following form: 29 30 The unapproved public offering statement previously delivered 31 to you, together with the enclosed revisions, has been 29 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 approved by the Division of Florida Land Sales, Condominiums, 2 and Mobile Homes. Accordingly, your cancellation right expires 3 10 calendar days after you sign your purchase contract or 10 4 calendar days after you receive these revisions, whichever is 5 later. If you have any questions regarding your cancellation 6 rights, you may contact the division at [insert division's 7 current address]. 8 3. After receipt of approval from the division and 9 prior to closing, if no revisions have been made to the 10 documents contained in the unapproved purchaser public 11 offering statement, or if such revisions do not materially 12 alter or modify the offering in a manner adverse to a 13 purchaser, the developer shall send the purchaser a notice 14 containing a statement in conspicuous type in substantially 15 the following form: 16 17 The unapproved public offering statement previously delivered 18 to you has been approved by the Division of Florida Land 19 Sales, Condominiums, and Mobile Homes. Revisions made to the 20 unapproved public offering statement, if any, are either not 21 required to be delivered to you or are not deemed by the 22 developer, in its opinion, to materially alter or modify the 23 offering in a manner that is adverse to you. Accordingly, your 24 cancellation right expired 10 days after you signed your 25 purchase contract. A complete copy of the approved public 26 offering statement is available through the managing entity 27 for inspection as part of the books and records of the plan. 28 If you have any questions regarding your cancellation rights, 29 you may contact the division at [insert division's current 30 address]. 31 30 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (3)(a)1. Any change to an approved public offering 2 statement filing shall be filed with the division for approval 3 as an amendment prior to becoming effective. The division 4 shall have 20 days after receipt of a proposed amendment to 5 approve or cite deficiencies in the proposed amendment. If the 6 division fails to act within 20 days, the amendment will be 7 deemed approved. If the proposed amendment adds a new 8 component site to an approved multisite timeshare plan, the 9 division's initial period in which to approve or cite 10 deficiencies is 45 days. If the developer fails to adequately 11 respond to any deficiency notice within 30 days, the division 12 may reject the amendment. Subsequent to such rejection, a new 13 filing fee pursuant to subsection (4) and a new division 14 initial review period pursuant to this paragraph shall apply 15 to any refiling or further review of the rejected amendment. 16 2. For filings only subject to this part, each 17 approved amendment to the approved purchaser public offering 18 statement, other than an amendment made only for the purpose 19 of the addition of a phase or phases to the timeshare plan in 20 the manner described in the timeshare instrument or any 21 amendment that does not materially alter or modify the 22 offering in a manner that is adverse to a purchaser, shall be 23 delivered to a purchaser no later than 10 days prior to 24 closing. For filings made under part II, each approved 25 amendment to the multisite timeshare plan purchaser public 26 offering statement, other than an amendment made only for the 27 purpose of the addition, substitution, or deletion of a 28 component site pursuant to part II or the addition of a phase 29 or phases to a component site of a multisite timeshare plan in 30 the manner described in the timeshare instrument or any 31 amendment that does not materially alter or modify the 31 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 offering in a manner that is adverse to a purchaser, shall be 2 delivered to a purchaser no later than 10 days prior to 3 closing. 4 3. Amendments made to a timeshare instrument for a 5 component site located in this state are not required to be 6 delivered to purchasers who do not receive a timeshare estate 7 or an interest in a specific multisite timeshare plan license8 in that component site. Amendments made to a timeshare 9 instrument for a component site not located in this state are 10 not required to be delivered to purchasers. 11 (b) At the time that any amendments required to be 12 delivered to purchasers, as provided in paragraph (a), are 13 delivered to purchasers, the developer shall provide to those 14 purchasers who have not closed a written statement that the 15 purchaser or lessee will have a 10-day voidability period. 16 (4)(a) Upon the filing of a filedregisteredpublic 17 offering statement, the developer shall pay a filing fee of $2 18 for each 7 days of annual use availability in each timeshare 19 unit that may be offered as a part of the proposed timeshare 20 plan pursuant to the filing. 21 (b) Upon the filing of an amendment to an approved 22 filedregisteredpublic offering statement, other than an23amendment adding a phase to the timeshare plan, the developer 24 shall pay a filing fee of $100. 25 (5) Every filedregisteredpublic offering statement 26 for a timeshare plan which is not a multisite timeshare plan 27 shall contain the information required by this subsection. The 28 division is authorized to provide by rule the method by which 29 a developer must provide such information to the division. 30 (a) A cover page stating only: 31 1. The name of the timeshare plan; and 32 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 2. The following statement, in conspicuous type: This 2 public offering statement contains important matters to be 3 considered in acquiring a timeshare interest. The statements 4 contained in this public offering statement are only summary 5 in nature. A prospective purchaser should refer to all 6 references, accompanying exhibits, contract documents, and 7 sales materials. You should not rely upon oral representations 8 as being correct. Refer to this document and accompanying 9 exhibits for correct representations. The seller is prohibited 10 from making any representations other than those contained in 11 the contract and this public offering statement. 12 (b) A listing of all statements required to be in 13 conspicuous type in the public offering statement and in all 14 exhibits thereto. 15 (c) A separate index of the contents and exhibits of 16 the public offering statement. 17 (d) A text which shall include, where applicable, the 18 disclosures set forth in paragraphs (e)-(hh). 19 (e) A description of the timeshare plan, including, 20 but not limited to: 21 1. Its name and location. 22 2. An explanation of the form of timeshare ownership 23 that is being offered, including a statement as to whether any 24 interest in the underlying real property will be conveyed to 25 the purchaser. If the plan is being created or being sold on a 26 leasehold, a description of the material terms of the lease 27 shall be included. If the plan is a plan in which timeshare 28 estates or personal property timeshare interests are sold as 29 interests in a trust pursuant to the requirements of this 30 chapter, a full and accurate description of the trust 31 arrangement and the trustee's duties shall be included. If the 33 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 plan is a personal property timeshare plan, a description of 2 the material terms of the arrangement for the ownership or use 3 of the personal property shall be included. 4 3. An explanation of the manner in which the 5 apportionment of common expenses and ownership of the common 6 elements has been determined. 7 4. If ownership or use of the timeshare plan is based 8 on a point system, a statement indicating the circumstances by 9 which the point values may change, the extent of such changes, 10 and the person or entity responsible for the changes. 11 5. If any of the accommodations or facilities are part 12 of a personal property timeshare plan in which the 13 accommodations or facilities are located on or in a documented 14 vessel or foreign vessel as provided in s. 721.08(2)(c)3.e., 15 the disclosure required by s. 721.08(2)(c)3.e.IV. 16 (f) A description of the accommodations, including, 17 but not limited to: 18 1. The number of timeshare units in each building, the 19 total number of timeshare periods declared as part of the 20 timeshare plan and filed with the division, and the number of 21 bathrooms and bedrooms in each type of timeshare unit. 22 2. The latest date estimated for completion of 23 constructing, finishing, and equipping the timeshare units 24 declared as part of the timeshare plan and filed with the 25 division. 26 3. The estimated maximum number of units and timeshare 27 periods that will use the accommodations and facilities. If 28 the maximum number of timeshare units or timeshare periods 29 will vary, a description of the basis for variation. 30 4. The duration, in years, of the timeshare plan. 31 34 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 5. If any of the accommodations are part of a personal 2 property timeshare plan, the name, vehicle registration 3 number, title certificate number, or any other identifying 4 registration number assigned to the accommodation of a 5 personal property timeshare plan by a state, federal, or 6 international governmental agency. 7 6. If any of the accommodations are part of a personal 8 property timeshare plan, the fire detection system and fire 9 safety equipment and description of method of compliance with 10 any applicable firesafety or fire detection regulations. 11 (g) A description of any thefacilities that will be 12 used by purchasers of the plan, including, but not limited to: 13 1. The intended purpose, if not apparent from the 14 description. 15 2. The estimated date when each facility will be 16 available for use by the purchaser. 17 3. A statement as to whether the facilities will be 18 used exclusively by purchasers of the timeshare plan, and, if 19 not, a statement as to whether the purchasers of the timeshare 20 plan are required to pay any portion of the maintenance and 21 expenses of such facilities. 22 (h)1. If any facilities offered by the developer for 23 use by purchasers are to be leased or have club memberships 24 associated with them, other than participation in a vacation 25 club, one of the following statements in conspicuous type: 26 There is a lease associated with one or more facilities of the 27 timeshare plan; or, There is a club membership associated with 28 one or more facilities of the timeshare plan. 29 2. If it is mandatory that purchasers pay fees, rent, 30 dues, or other charges under a facilities lease or club 31 membership for the use of the facilities, other than 35 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 participation in a vacation club, the applicable statement in 2 conspicuous type in substantially the following form: 3 a. Membership in a facilities club is mandatory for 4 purchasers; 5 b. Purchasers or the owners' association(s) are 6 required, as a condition of ownership, to be lessees under the 7 facilities lease; 8 c. Purchasers or the owners' association(s) are 9 required to pay their share of the rent or costs and expenses 10 of maintenance, management, upkeep, and replacement under the 11 facilities lease (or the other instruments providing the 12 facilities); or 13 d. A similar statement of the nature of the 14 organization or the manner in which the use rights are 15 created, and that purchasers are required to pay. 16 17 Immediately following the applicable statement, a description 18 of the lease or other instrument shall be stated, including a 19 description of terms of the payment of rent or costs and 20 expenses of maintenance, management, upkeep, and replacement 21 of the facilities. 22 3. If the purchasers are required to pay a use fee, or 23 other payment for the use of the facilities, not including the 24 rent or maintenance, management, upkeep, or replacement costs 25 and expenses, the following statement in conspicuous type: The 26 purchasers or the owners' association(s) must pay use fees for 27 one or more facilities. Immediately following this statement, 28 a description of the use fees shall be included. 29 4. If any person other than the owners' association 30 has the right to a lien on the timeshare interests to secure 31 the payment of assessments, rent, or other exactions, a 36 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 statement in conspicuous type in substantially the following 2 form: 3 a. There is a lien or lien right against each 4 timeshare interest to secure the payment of rent and other 5 exactions under the facilities lease. A purchaser's failure to 6 make these payments may result in foreclosure of the lien; or 7 b. There is a lien or lien right against each 8 timeshare interest to secure the payment of assessments or 9 other exactions coming due for the use, maintenance, upkeep, 10 or repair of one or more facilities. A purchaser's failure to 11 make these payments may result in foreclosure of the lien. 12 13 Immediately following the applicable statement, a description 14 of the lien right shall be included. 15 (i) If the developer or any other person has the right 16 to increase or add to the facilities at any time after the 17 establishment of the timeshare plan, without the consent of 18 the purchasers or owners' association being required, a 19 statement in conspicuous type in substantially the following 20 form: Facilities may be expanded or added without consent of 21 the purchasers or the owners' association(s). Immediately 22 following this statement, a description of such reserved 23 rights shall be included. 24 (j)1. For a real property timeshare plan, an 25 explanation of the status of the title to the real property 26 underlying the timeshare plan, including a statement of the 27 existence of any lien, defect, judgment, mortgage, or other 28 encumbrance affecting the title to the property, and how such 29 lien, defect, judgment, mortgage, or other encumbrance will be 30 removed or satisfied prior to closing. 31 37 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 2. For a personal property timeshare plan, an 2 explanation of the status of title to the personal property 3 underlying the timeshare plan, including a statement of the 4 existence of any lien, defect, judgment, or other encumbrance 5 affecting the title to the personal property, and how such 6 lien, defect, judgment, or other encumbrance will be removed 7 or satisfied prior to closing. 8 (k) A description of any judgment against the 9 developer, the managing entity, owner of the underlying fee, 10 or owner of the underlying personal property fee, which 11 judgment is material to the timeshare plan; the status of any 12 pending suit to which the developer, the managing entity, 13 owner of the underlying fee, or owner of the underlying 14 personal propertyfeeis a party, which suit is material to 15 the timeshare plan; and any other suit which is material to 16 the timeshare plan of which the developer, managing entity, 17 owner of the underlying fee, or owner of the underlying 18 personal propertyfeehas actual knowledge. If no judgments or 19 pending suits exist, there shall be a statement of such fact. 20 (l) A description of all unusual and material 21 circumstances, features, and characteristics of the real 22 property or personal property underlying or comprising the 23 timeshare plan. 24 (m) A description of any financing to be offered to 25 purchasers by the developer or any person or entity in which 26 the developer has a financial interest, together with a 27 disclosure that the description of such financing may be 28 changed by the developer and that any change in the financing 29 offered to prospective purchasers will not be deemed to be a 30 material change. 31 38 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (n) A detailed explanation of any financial 2 arrangements which have been provided for completion of all 3 promised improvements. 4 (o) The name and address of the managing entity; a 5 statement whether the seller may change the managing entity or 6 its control and, if so, the manner by which the seller may 7 change the managing entity; a statement of the arrangements 8 for management, maintenance, and operation of the 9 accommodations and facilities and of other property that will 10 serve the purchasers; and a description of the management 11 arrangement and any contracts for these purposes having a term 12 in excess of 1 year, including the names of the contracting 13 parties, the term of the contract, the nature of the services 14 included, and the compensation, stated for a month and for a 15 year, and provisions for increases in the compensation. In the 16 case of a personal property timeshare plan in which the 17 accommodations or facilities are located on or in a documented 18 vessel or foreign vessel as provided in s. 721.08(2)(c)3.e., a 19 statement shall be included that describes the trustee's or 20 owners' association's access to the certificates of 21 classification and indicates that the certificate of 22 classification will be made available to purchasers on 23 request. 24 (p) If any person other than the purchasers has the 25 right to retain control of the board of administration of the 26 owners' association, if any, for a period of time which may 27 exceed 1 year after the closing of the sale of a majority of 28 the timeshare interests in that timeshare plan to persons 29 other than successors or concurrent developers and the plan is 30 one in which all purchasers automatically become members of 31 the owners' association, a statement in conspicuous type in 39 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 substantially the following form: The developer (or other 2 person) has the right to retain control of the owners' 3 association after a majority of the timeshare interests have 4 been sold. Immediately following this statement, a description 5 of the applicable transfer of control provisions of the 6 timeshare plan shall be included. 7 (q)1. If there are any restrictions upon the sale, 8 transfer, conveyance, or leasing of a timeshare interest, a 9 statement in conspicuous type in substantially the following 10 form: The sale, lease, or transfer of timeshare interests is 11 restricted or controlled. Immediately following this 12 statement, a description of the nature of the restriction, 13 limitation, or control on the sale, lease, or transfer of 14 timeshare interests shall be included. 15 2. The following statement in conspicuous type in 16 substantially the following form: The purchase of a timeshare 17 interest should be based upon its value as a vacation 18 experience or for spending leisure time, and not considered 19 for purposes of acquiring an appreciating investment or with 20 an expectation that the timeshare interest may be resold. 21 (r) If the timeshare plan is part of a phase project, 22 a statement to that effect and a complete description of the 23 phasing. Notwithstanding any provisions of s. 718.110 or s. 24 719.1055, a developer may develop a timeshare condominium or a 25 timeshare cooperative in phases if the original declaration of 26 condominium or cooperative documents submitting the initial 27 phase to condominium ownership or cooperative ownership or an 28 amendment to the declaration of condominium or cooperative 29 documents which has been approved by all of the unit owners 30 and unit mortgagees provides for phasing. Notwithstanding any 31 provisions of s. 718.403 or s. 719.403 to the contrary, the 40 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 original declaration of condominium or cooperative documents, 2 or an amendment to the declaration of condominium or 3 cooperative documents adopted pursuant to this subsection, 4 need only generally describe the developer's phasing plan and 5 the land which may become part of the condominium or 6 cooperative, and, in conjunction therewith, the developer may 7 also reserve all rights to vary his or her phasing plan as to 8 phase boundaries, plot plans and floor plans, timeshare unit 9 types, timeshare unit sizes and timeshare unit type mixes, 10 numbers of timeshare units, and facilities with respect to 11 each subsequent phase. There shall be no time limit during 12 which a developer of a timeshare condominium or timeshare 13 cooperative must complete his or her phasing plan, and the 14 developer shall not be required to notify owners of existing 15 timeshare estates of his or her decision not to add one or 16 more proposed phases. 17 (s) A description of the material restrictions, if 18 any, to be imposed on timeshare interests concerning the use 19 of any of the accommodations or facilities, including 20 statements as to whether there are restrictions upon children 21 and pets or a reference to a copy of the documents containing 22 the restrictions which shall be attached as an exhibit. If 23 there are no restrictions, there shall be a statement of such 24 fact. 25 (t) If there is any land or personal property that is 26 offered by the developer for use by the purchasers and which 27 is neither owned by them nor leased to them, the owners' 28 association, or any entity controlled by the purchasers, a 29 statement describing the land or personal property, how it 30 will serve the timeshare plan, and the nature and term of 31 service. 41 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (u) An estimated operating budget for the timeshare 2 plan and a schedule of the purchaser's expenses shall be 3 attached as an exhibit and shall contain the following 4 information: 5 1. The estimated annual expenses of the timeshare plan 6 collectible from purchasers by assessments. The estimated 7 payments by the purchaser for assessments shall also be stated 8 in the estimated amounts for the times when they will be due. 9 Expenses shall also be shown for the shortest timeshare period 10 offered for sale by the developer. If the timeshare plan 11 provides for the offer and sale of units to be used on a 12 nontimeshare basis, the estimated monthly and annual expenses 13 of such units shall be set forth in a separate schedule. 14 2. The estimated weekly, monthly, and annual expenses 15 of the purchaser of each timeshare interest, other than 16 assessments payable to the managing entity. Expenses which are 17 personal to purchasers that are not uniformly incurred by all 18 purchasers or that are not provided for or contemplated by the 19 timeshare plan documents may be excluded from this estimate. 20 3. The estimated items of expenses of the timeshare 21 plan and the managing entity, except as excluded under 22 subparagraph 2., including, but not limited to, if applicable, 23 the following items, which shall be stated either as 24 management expenses collectible by assessments or as expenses 25 of the purchaser payable to persons other than the managing 26 entity: 27 a. Expenses for the managing entity: 28 (I) Administration of the managing entity. 29 (II) Management fees. 30 (III) Maintenance. 31 (IV) Rent for facilities. 42 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (V) Taxes upon timeshare property. 2 (VI) Taxes upon leased areas. 3 (VII) Insurance. 4 (VIII) Security provisions. 5 (IX) Other expenses. 6 (X) Operating capital. 7 (XI) Reserves for deferred maintenance and reserves 8 for capital expenditures. 9 (A) All reserves for any accommodations and facilities 10 of real property timeshare plans located in this state shall 11 be calculated by a formula which is based upon estimated life 12 and replacement cost of each reserve item. Reserves for 13 deferred maintenance for such accommodations and facilities 14 shall include accounts for roof replacement, building 15 painting, pavement resurfacing, replacement of timeshare unit 16 furnishings and equipment, and any other component, the useful 17 life of which is less than the useful life of the overall 18 structure. For any accommodations and facilities of real 19 property timeshare plans located outside of this state, the 20 developer shall disclose the amount of reserves for deferred 21 maintenance or capital expenditures required by the law of the 22 situs state, if applicable, and maintained for such 23 accommodations and facilities. 24 (B) Reserves for deferred maintenance or capital 25 expenditures of accommodations and facilities of a personal 26 property timeshare plan, if any. If such reserves are 27 maintained, the estimated operating budget shall disclose the 28 methodology of how the reserves are calculated. If a personal 29 property timeshare plan does not require reserves, the 30 following statement, in conspicuous type, shall appear in both 31 the budget and the public offering statement: 43 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 2 The estimated operating budget for this personal property 3 timeshare plan does not include reserves for deferred 4 maintenance or capital expenditures; each timeshare interest 5 may be subject to substantial special assessments from time to 6 time because no such reserves exist. 7 8 (XII) Fees payable to the division. 9 b. Expenses for a purchaser: 10 (I) Rent for the timeshare unit, if subject to a 11 lease. 12 (II) Rent payable by the purchaser directly to the 13 lessor or agent under any lease for the use of facilities, 14 which use and payment is a mandatory condition of ownership 15 and is not included in the common expenses or assessments for 16 common maintenance paid by the purchasers to the managing 17 entity. 18 4. The estimated amounts shall be stated for a period 19 of at least 12 months and may distinguish between the period 20 prior to the time that purchasers elect a majority of the 21 board of administration and the period after that date. 22 5. If the developer intends to guarantee the level of 23 assessments, such guarantee must be based upon a good faith 24 estimate of the revenues and expenses of the timeshare plan. 25 The guarantee must include a description of the following: 26 a. The specific time period measured in one or more 27 calendar or fiscal years during which the guarantee will be in 28 effect. 29 b. A statement that the developer will pay all common 30 expenses incurred in excess of the total revenues of the 31 timeshare plan pursuant to s. 721.15(2) if the developer has 44 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 excused himself or herself from the payment of assessments 2 during the guarantee period. 3 c. The level, expressed in total dollars, at which the 4 developer guarantees the budget. If the developer has reserved 5 the right to extend or increase the guarantee level pursuant 6 to s. 721.15(2), a disclosure must be included to that effect. 7 6. If the developer intends to provide a trust fund to 8 defer or reduce the payment of annual assessments, a copy of 9 the trust instrument shall be attached as an exhibit and shall 10 include a description of such arrangement, including, but not 11 limited to: 12 a. The specific amount of such trust funds and the 13 source of the funds. 14 b. The name and address of the trustee. 15 c. The investment methods permitted by the trust 16 agreement. 17 d. A statement in conspicuous type that the funds from 18 the trust account may not cover all assessments and that there 19 is no guarantee that purchasers will not have to pay 20 assessments in the future. 21 7. The budget of a phase timeshare plan may contain a 22 note identifying the number of timeshare interests covered by 23 the budget, indicating the number of timeshare interests, if 24 any, estimated to be declared as part of the timeshare plan 25 during that calendar year, and projecting the common expenses 26 for the timeshare plan based upon the number of timeshare 27 interests estimated to be declared as part of the timeshare 28 plan during that calendar year. 29 (v) A schedule of estimated closing expenses to be 30 paid by a purchaser or lessee of a timeshare interest and a 31 statement as to whether a title opinion or title insurance 45 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 policy is available to the purchaser and, if so, at whose 2 expense. 3 (w) The identity of the developer and the chief 4 operating officer or principal directing the creation and sale 5 of the timeshare plan and a statement of the experience of 6 each in this field or, if no experience, a statement of that 7 fact. 8 (x) A statement of the total financial obligation of 9 the purchaser, including the purchase price and any additional 10 charges to which the purchaser may be subject. 11 (y) The name of any person who will or may have the 12 right to alter, amend, or add to the charges to which the 13 purchaser may be subject and the terms and conditions under 14 which such alterations, amendments, or additions may be 15 imposed. 16 (z) A statement of the purchaser's right of 17 cancellation of the purchase contract. 18 (aa) A description of the insurance coverage provided 19 for the timeshare plan. 20 (bb) A statement as to whether the timeshare plan is 21 participating in an exchange program and, if so, the name and 22 address of the exchange company offering the exchange program. 23 (cc) The existence of rules and regulations regarding 24 any reservation features governing a purchaser's ability to 25 make reservations for a timeshare period, including, if 26 applicable, a conspicuous type disclaimer in substantially the 27 following form: 28 29 The right to reserve a timeshare period is subject to rules 30 and regulations of the timeshare plan reservation system. 31 46 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (dd) If a developer is filing a timeshare plan that 2 includes a timeshare instrument or component site document 3 that was in conformance with the laws and rules in existence 4 at the time the timeshare plan was created but does not 5 conform to existing laws and rules that govern the timeshare 6 plan and the developer does not have the authority or power to 7 amend or change the timeshare instrument or component site 8 document to conform to such existing laws or rules as directed 9 by the division, a brief explanation of current law and the 10 conflict with the timeshare instrument or component site 11 document, preceded by disclaimer in conspicuous type in 12 substantially the following form: 13 14 Florida law has been amended and certain provisions in [insert 15 appropriate reference to timeshare instrument or component 16 site document] that were in conformance with Florida law as it 17 existed at the time the timeshare plan was created are not in 18 conformance with current Florida law. These documents may only 19 be amended by [insert appropriate reference to person or 20 entity that has the right to amend or change the timeshare 21 instrument or component site document]. The developer does not 22 warrant that such documents are in technical compliance with 23 all applicable Florida laws and regulations. All questions 24 regarding amendment of these documents should be directed to 25 [insert appropriate reference to person or entity that has the 26 right to amend or change the timeshare instrument or component 27 site document]. 28 29 (ee) Any other information that a seller, with the 30 approval of the division, desires to include in the public 31 offering statement. 47 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (ff) Copies of the following documents and plans, to 2 the extent they are applicable, shall be included as exhibits 3 to the filed registeredpublic offering statement provided, if 4 the timeshare plan has not been declared or created at the 5 time of the filing, the developer shall provide proposed 6 documents: 7 1. The declaration of condominium. 8 2. The cooperative documents. 9 3. The declaration of covenants and restrictions. 10 4. The articles of incorporation creating the owners' 11 association. 12 5. The bylaws of the owners' association. 13 6. AnyTheground lease or other underlying lease of 14 the real property associated withon whichthe timeshare plan 15is situated. In the case of a personal property timeshare 16 plan, any lease of the personal property associated with the 17 personal property timeshare plan. 18 7. The management agreement and all maintenance and 19 other contracts regarding the management and operation of the 20 timeshare property which have terms in excess of 1 year. 21 8. The estimated operating budget for the timeshare 22 plan and the required schedule of purchasers' expenses. 23 9. The floor plan of each type of accommodation and 24 the plot plan showing the location of all accommodations and 25 facilities declared as part of the timeshare plan and filed 26 with the division. 27 10. The lease for any facilities. 28 11. A declaration of servitude of properties serving 29 the accommodations and facilities, but not owned by purchasers 30 or leased to them or the owners' association. 31 48 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 12. Any documents required by s. 721.03(3)(e) as the 2 result of the inclusion of a timeshare plan in the conversion 3 of the building to condominium or cooperative ownership. 4 13. The form of agreement for sale or lease of 5 timeshare interests. 6 14. The executed agreement for escrow of payments made 7 to the developer prior to closing and the form of any 8 agreement for escrow of ad valorem tax escrow payments, if 9 any, to be made into an ad valorem tax escrow account pursuant 10 to s. 192.037(6). 11 15. The documents containing any restrictions on use 12 of the property required by paragraph (s). 13 16. A letter from the escrow agent or filing attorney 14 confirming that the escrow agent and its officers, directors, 15 or other partners are independent pursuant to the requirements 16 of this chapter. 17 17. Any nondisturbance and notice to creditors 18 instrument required by s. 721.08. 19 18. In the case of any personal property timeshare 20 plan in which the accommodations and facilities are located on 21 or in a documented vessel or foreign vessel as provided in s. 22 721.08(2)(c)3.e., a copy of the certificate of ownership of 23 such vessel and either a copy of the certificate of 24 documentation or certificate of registry of such vessel. 25 19. An executed affidavit given under oath by an 26 attorney licensed to practice law in any jurisdiction in the 27 United States stating that the attorney has researched the 28 applicable laws of the jurisdiction in which governing law has 29 been established and the laws of the jurisdiction in which the 30 vessel is registered and has found that the timeshare 31 49 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 instrument complies with the provisions of s. 2 721.08(2)(c)3.e.(II)(C) and s. 721.08(2)(c)3.e.(III). 3 20. 16.Any other documents or instruments creating the 4 timeshare plan. 5 (gg) Such other information as is necessary to fairly, 6 meaningfully, and effectively disclose all aspects of the 7 timeshare plan, including, but not limited to, any disclosures 8 made necessary by the operation of s. 721.03(8). However, if a 9 developer has, in good faith, attempted to comply with the 10 requirements of this section, and if, in fact, he or she has 11 substantially complied with the disclosure requirements of 12 this chapter, nonmaterial errors or omissions shall not be 13 actionable. 14 (hh) Notwithstanding the provisions of this 15 subsection, the filedregisteredpublic offering statement for 16 a component site of a multisite timeshare plan filed pursuant 17 to this subsection may contain cross-references to information 18 contained in the related multisite timeshare plan filed 19registeredpublic offering statement filed pursuant to s. 20 721.55 in lieu of repeating such information. 21 (6) The division is authorized to prescribe by rule 22 the form of the approved purchaser public offering statement 23 that must be furnished by the developer to each purchaser. The 24 form of the purchaser public offering statement must provide 25 fair, meaningful, and effective disclosure of all aspects of 26 the timeshare plan. For timeshare plans filed pursuant to this 27 part, the developer shall furnish each purchaser with the 28 following: 29 (a) A copy of the purchaser public offering statement 30 text in the form approved by the division for delivery to 31 purchasers. 50 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (b) Copies of the exhibits required to be filed with 2 the division pursuant to subparagraphs (5)(ff)1., 2., 4., 5., 3 8., and 16. 4 (c) A receipt for timeshare plan documents and a list 5 describing any exhibit to the filed registeredpublic offering 6 statement filed with the division which is not delivered to 7 the purchaser. The division is authorized to prescribe by rule 8 the form of the receipt for timeshare plan documents and the 9 description of exhibits list that must be furnished to the 10 purchaser. The description of documents list utilized by a 11 developer shall be filed with the division for review as part 12 of the filedregisteredpublic offering statement pursuant to 13 this section. The developer shall be required to provide the 14 managing entity with a copy of the approved filedregistered15 public offering statement and any approved amendments thereto 16 to be maintained by the managing entity as part of the books 17 and records of the timeshare plan pursuant to s. 721.13(3)(d). 18 (d) Any other exhibit which the developer includes as 19 part of the purchaser public offering statement, provided that 20 the developer first files the exhibit with the division. 21 (e) An executed copy of any document which the 22 purchaser signs. 23 (f) Each purchaser shall receive a fully executed 24 paper copy of the purchase contract. 25 Section 7. Paragraph (g) of subsection (1) of section 26 721.075, Florida Statutes, is amended and paragraph (e) is 27 added to subsection (2) of that section, to read: 28 721.075 Incidental benefits.--Incidental benefits 29 shall be offered only as provided in this section. 30 (1) Accommodations, facilities, products, services, 31 discounts, or other benefits which satisfy the requirements of 51 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 this subsection shall be subject to the provisions of this 2 section and exempt from the other provisions of this chapter 3 which would otherwise apply to such accommodations or 4 facilities if and only if: 5 (g) The incidental benefit is filed with the division 6 for review in conjunction with the filing of a timeshare plan 7 or in connection with a previously filed timeshare plan. 8 (2) Each purchaser shall execute a separate 9 acknowledgment and disclosure statement with respect to all 10 incidental benefits, which statement shall include the 11 following information: 12 (e) A statement indicating the source of the services, 13 points, or other products that constitute the incidental 14 benefit. 15 Section 8. Section 721.08, Florida Statutes, is 16 amended to read: 17 721.08 Escrow accounts; nondisturbance instruments; 18 alternate security arrangements; transfer of legal title.-- 19 (1) Prior to the filing of a registeredpublic 20 offering statement with the division, all developers shall 21 establish an escrow account with an escrow agent for the 22 purpose of protecting the funds or other property of 23 purchasers required to be escrowed by this section. An escrow 24 agent shall maintain the accounts called for in this section 25 only in such a manner as to be under the direct supervision 26 and control of the escrow agent. The escrow agent shall have a 27 fiduciary duty to each purchaser to maintain the escrow 28 accounts in accordance with good accounting practices and to 29 release the purchaser's funds or other property from escrow 30 only in accordance with this chapter. The escrow agent shall 31 retain all affidavits received pursuant to this section for a 52 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 period of 5 years. Should the escrow agent receive conflicting 2 demands for funds or other property held in escrow, the escrow 3 agent shall immediately notify the division of the dispute and 4 either promptly submit the matter to arbitration or, by 5 interpleader or otherwise, seek an adjudication of the matter 6 by court. 7 (2) One hundred percent of all funds or other property 8 which is received from or on behalf of purchasers of the 9 timeshare plan or timeshare interest prior to the occurrence 10 of events required in this subsection shall be deposited 11 pursuant to an escrow agreement approved by the division. The 12 escrow agreement shall provide that thefunds or other 13 property may be released from escrow only as follows: 14 (a) Cancellation.--In the event a purchaser gives a 15 valid notice of cancellation pursuant to s. 721.10 or is 16 otherwise entitled to cancel the sale, the funds or other 17 property received from or on behalf of the purchaser, or the 18 proceeds thereof, shall be returned to the purchaser. Such 19 refund shall be made within 20 days afterofdemand therefor 20 by the purchaser or within 5 days after receipt of funds from 21 the purchaser's cleared check, whichever is later. If the 22 purchaser has received benefits under the contract prior to 23 the effective date of the cancellation, the funds or other 24 property to be returned to the purchaser may be reduced by the 25 proportion of contract benefits actually received. 26 (b) Purchaser's default.--Following expiration of the 27 10-day cancellation period, if the purchaser defaults in the 28 performance of her or his obligations under the terms of the 29 contract to purchase or such other agreement by which a seller 30 sells the timeshare interest, the developer shall provide an 31 affidavit to the escrow agent requesting release of the 53 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 escrowed funds or other property and shall provide a copy of 2 such affidavit to the purchaser who has defaulted. The 3 developer' s affidavit, as required herein, shall include: 4 1. A statement that the purchaser has defaulted and 5 that the developer has not defaulted; 6 2. A brief explanation of the nature of the default 7 and the date of its occurrence; 8 3. A statement that pursuant to the terms of the 9 contract the developer is entitled to the funds held by the 10 escrow agent; and 11 4. A statement that the developer has not received 12 from the purchaser any written notice of a dispute between the 13 purchaser and developer or a claim by the purchaser to the 14 escrow. 15 (c) Compliance with conditions.-- 16 1. Timeshare licenses.--If the timeshare plan is one 17 in which timeshare licenses are to be sold and no cancellation 18 or default has occurred, the escrow agent may release the 19 escrowed funds or other property to or on the order of the 20 developer upon presentation of: 21 a. An affidavit by the developer that all of the 22 following conditions have been met: 23 (I) Expiration of the cancellation period. 24 (II) Completion of construction. 25 (III) Closing. 26 (IV) Either: 27 (A) Execution, delivery, and recordation by each 28 interestholder of the nondisturbance and notice to creditors 29 instrument, as described in this section; or , alternatively,30 (B) Transfer by the developer of legal title to the 31 subject accommodations and facilities, or all use rights 54 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 therein, into toa trust satisfying the requirements of 2 subparagraph 4.sub-subparagraph 3.b.and the execution, 3 delivery, and recordation by each other interestholder of the 4 nondisturbance and notice to creditors instrument, as 5 described in this section. 6 b. A certified copy of eachtherecorded 7 nondisturbance and notice to creditors instrumentthat8complies with subsection (3). 9 c. One of the following: 10 (I) A copy of a memorandum of agreement, as defined in 11 s. 721.05(21), together with satisfactory evidence that the 12 original memorandum of agreement has been irretrievably 13 delivered for recording to the appropriate official 14 responsible for maintaining the public records in the county 15 in which the subject accommodations and facilities are 16 located. The original memorandum of agreement must be recorded 17 within 180 days after the date on which the purchaser executed 18 her or his purchase agreement. 19 (II) A notice delivered for recording to the 20 appropriate official responsible for maintaining the public 21 records in each county in which the subject accommodations and 22 facilities are located notifying all persons of the identity 23 of an independent escrow agent or trustee satisfying the 24 requirements of subparagraph 4.sub-subparagraph 3.b.that 25 shall maintain separate books and records, in accordance with 26 good accounting practices, for the timeshare plan in which 27 timeshare licenses are to be sold. The books and records shall 28 indicate each accommodation and facility that is subject to 29 such a timeshare plan and each purchaser of a timeshare 30 license in the timeshare plan. 31 55 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 2. Timeshare estates.--If the timeshare plan is one in 2 which timeshare estates are to be sold , other than interests3in a trust pursuant to subparagraph 3.,and no cancellation or 4 default has occurred, the escrow agent may release the 5 escrowed funds or other property to or on the order of the 6 developer upon presentation of: 7 a. An affidavit by the developer that all of the 8 following conditions have been met: 9 (I) Expiration of the cancellation period. 10 (II) Completion of construction. 11 (III) Closing. 12 b. If the timeshare estate is sold by agreement for 13 deed, a certified copy of the recorded nondisturbance and 14 notice to creditors instrument, as described in this section. 15 c. Evidence that each accommodation and facility: 16 (I) Is free and clear of the claims of any 17 interestholders, other than the claims of interestholders 18 that, through a recorded instrument, are irrevocably made 19 subject to the timeshare instrument and the use rights of 20 purchasers made available through the timeshare instrument; 21 (II) Is the subject of a recorded nondisturbance and 22 notice to creditors instrument that complies with subsection 23 (3) and s. 721.17; or 24 (III) Has been transferred into a trust satisfying the 25 requirements of subparagraph 4. 26 d. Evidence that the timeshare estate: 27 (I) Is free and clear of the claims of any 28 interestholders, other than the claims of interestholders 29 that, through a recorded instrument, are irrevocably made 30 subject to the timeshare instrument and the use rights of 31 56 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 purchasers made available through the timeshare instrument; ,2 or 3 (II) Isthat arethe subject of a recorded 4 nondisturbance and notice to creditors instrument that 5 complies with subsection (3) and s. 721.17(3). 6 3. Personal property timeshare interests.-- If the 7 timeshare plan is one in which personal property timeshare 8 interestsestatesare to be soldas interests in a trust that9complies in all respects with the provisions of10sub-subparagraph b., and no cancellation or default has 11 occurred, the escrow agent may release the escrowed funds or 12 other property to or on the order of the developer upon 13 presentation of: 14 a. An affidavit by the developer that all of the 15 following conditions have been met: 16 (I) Expiration of the cancellation period. 17 (II) Completion of construction. 18 (III)Transfer of the subject accommodations and19facilities, or all use rights therein, to the trust.20(IV)Closing. 21 b. If the personal property timeshare interest is sold 22 by agreement for transfer, evidence that the agreement for 23 transfer complies fully with s. 721.06 and this section. 24 c. Evidence that one of the following has occurred: 25 (I) Transfer by the owner of the underlying personal 26 property of legal title to the subject accommodations and 27 facilities or all use rights therein into a trust satisfying 28 the requirements of subparagraph 4.; or 29 (II) Transfer by the owner of the underlying personal 30 property of legal title to the subject accommodations and 31 57 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 facilities or all use rights therein into an owners' 2 association satisfying the requirements of subparagraph 5. 3 d. Evidence of compliance with the provisions of 4 subparagraph 6., if required. 5 e. If a personal property timeshare plan is created 6 with respect to accommodations and facilities that are located 7 on or in an ocean-going vessel, including a "documented 8 vessel" or "foreign vessel" as defined and governed by chapter 9 301 (Commercial Instruments and Liens), Title 46, United 10 States Code: 11 (I) In making the transfer required in 12 sub-subparagraph c., the developer shall use as its transfer 13 instrument a document that establishes and protects the 14 continuance of the use rights in the subject accommodations 15 and facilities in a manner that is enforceable by the trust or 16 owners' association. 17 (II) The transfer instrument shall comply fully with 18 the provisions of this chapter, shall be part of the timeshare 19 instrument, and shall contain specific provisions that: 20 (A) Prohibit the vessel owner, the developer, any 21 manager or operator of the vessel, the owners' association or 22 the trustee, the managing entity, or any other person from 23 incurring any liens against the vessel except for liens that 24 are required for the operation and upkeep of the vessel, 25 including liens for fuel expenditures, repairs, crews' wages, 26 and salvage, and except as provided in sub-sub-subparagraphs 27 4.b.(III) and 5.b.(III). All expenses, fees, and taxes 28 properly incurred in connection with the creation, 29 satisfaction, and discharge of any such permitted lien, or a 30 prorated portion thereof if less than all of the 31 58 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 accommodations on the vessel are subject to the timeshare 2 plan, shall be common expenses of the timeshare plan. 3 (B) Grant a lien against the vessel in favor of the 4 owners' association or trustee to secure the full and faithful 5 performance of the vessel owner and developer of all of their 6 obligations to the purchasers. 7 (C) Establish governing law in a jurisdiction that 8 recognizes and will enforce the timeshare instrument and the 9 laws of the jurisdiction of registry of the vessel. 10 (D) Require that a description of the use rights of 11 purchasers be posted and displayed on the vessel in a manner 12 that will give notice of such rights to any party examining 13 the vessel. This notice must identify the owners' association 14 or trustee and include a statement disclosing the limitation 15 on incurring liens against the vessel described in 16 sub-sub-sub-subparagraph (A). 17 (E) Include the nondisturbance and notice to creditors 18 instrument for the vessel owner and any other interestholders. 19 (F) The owners' association created under subparagraph 20 5. or trustee created under subparagraph 6. shall have access 21 to any certificates of classification in accordance with the 22 timeshare instrument. 23 (III) If the vessel is a foreign vessel, the vessel 24 must be registered in a jurisdiction that permits a filing 25 evidencing the use rights of purchasers in the subject 26 accommodations and facilities, offers protection for such use 27 rights against unfiled and inferior claims, and recognizes the 28 document or instrument creating such use rights as a lien 29 against the vessel. 30 (IV) In addition to the disclosures required by s. 31 721.07(5), the public offering statement and purchase contract 59 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 must contain a disclosure in conspicuous type in substantially 2 the following form: 3 4 The laws of the State of Florida govern the offering of this 5 timeshare plan in this state. There are inherent risks in 6 purchasing a timeshare interest in this timeshare plan because 7 the accommodations and facilities of the timeshare plan are 8 located on a vessel that will sail into international waters 9 and into waters governed by many different jurisdictions. 10 Therefore, the laws of the State of Florida cannot fully 11 protect your purchase of an interest in this timeshare plan. 12 Specifically, management and operational issues may need to be 13 addressed in the jurisdiction in which the vessel is 14 registered, which is ____________ [insert jurisdiction in 15 which vessel is registered]. Concerns of purchasers may be 16 sent to ________________ [insert name of applicable regulatory 17 agency and address]. 18 4. Trust.-- 19 a. If the subject accommodations or facilities, or all 20 use rights therein, are to be transferred into a trust in 21 order to comply with this paragraph, such transfer shall take 22 place pursuant to this subparagraph. 23 b. Prior to the transfer by each interestholder of the 24 subject accommodations and facilities, or all use rights 25 therein, to a trust, any lien or other encumbrance against 26 such accommodations and facilities, or use rights therein, 27 shall be made subject to a nondisturbance and notice to 28 creditors instrument pursuant to subsection (3) as described29in this section. No transfer pursuant to this subparagraph 30sub-subparagraphshall become effective until the trustee 31 accepts such transfer and the responsibilities set forth 60 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 herein. A trust established pursuant to this subparagraph 2 sub-subparagraphshall comply with the following provisions: 3 (I) The trustee shall be an individual or a business 4 entity authorized and qualified to conduct trust business in 5 this state. Any corporation authorized to do business in this 6 state may act as trustee in connection with a timeshare plan 7 pursuant to this chapter. The trustee must be independent from 8 any developer or managing entity of the timeshare plan or any 9 interestholder of any accommodation or facility of such plan. 10 (II) The trust shall be irrevocable so long as any 11 purchaser has a right to occupy any portion of the timeshare 12 property pursuant to the timeshare plan. 13 (III) The trustee shall not convey, hypothecate, 14 mortgage, assign, lease, or otherwise transfer or encumber in 15 any fashion any interest in or portion of the timeshare 16 property with respect to which any purchaser has a right of 17 use or occupancy unless the timeshare plan is terminated 18 pursuant to the timeshare instrument, or such conveyance, 19 hypothecation, mortgage, assignment, lease, transfer, or 20 encumbrance is approved by a vote of two-thirds of all voting 21 interests of the timeshare plan and such decision is declared 22 by a court of competent jurisdiction to be in the best 23 interests of the purchasers of the timeshare plan. The trustee 24 shall notify the division in writing within 10 days afterof25 receiving notice of the filing of any petition relating to 26 obtaining such a court order. The division shall have standing 27 to advise the court of the division's interpretation of the 28 statute as it relates to the petition. 29 (IV) All purchasers of the timeshare plan or the 30 owners' association of the timeshare plan shall be the express 31 beneficiaries of the trust. The trustee shall act as a 61 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 fiduciary to the beneficiaries of the trust. The personal 2 liability of the trustee shall be governed by s. 737.306. The 3 agreement establishing the trust shall set forth the duties of 4 the trustee. The trustee shall be required to furnish promptly 5 to the division upon request a copy of the complete list of 6 the names and addresses of the owners in the timeshare plan 7 and a copy of any other books and records of the timeshare 8 plan required to be maintained pursuant to s. 721.13 that are 9 in the possession, custody, or control of the trustee. All 10 expenses reasonably incurred by the trustee in the performance 11 of its duties, together with any reasonable compensation of 12 the trustee, shall be common expenses of the timeshare plan. 13 (V) The trustee shall not resign upon less than 90 14 days' prior written notice to the managing entity and the 15 division. No resignation shall become effective until a 16 substitute trustee, approved by the division, is appointed by 17 the managing entity and accepts the appointment. 18 (VI) The documents establishing the trust arrangement 19 shall constitute a part of the timeshare instrument. 20 (VII) For trusts holding property in a timeshare plan 21 located outside this state, the trust and trustee holding such 22 property shall be deemed in compliance with the requirements 23 of this subparagraph if such trust and trustee are is 24 authorized and qualified to conduct trust business under the 25 laws of such jurisdiction and the agreement or law governing 26 such trust arrangement provides substantially similar 27 protections for the purchaser as are required in this 28 subparagraph for trusts holding property in a timeshare plan 29 in this state. 30 (VIII) The trustee shall have appointed a registered 31 agent in this state for service of process. In the event such 62 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 a registered agent is not appointed, service of process may be 2 served pursuant to s. 721.265. 3 5. Owners' association.-- 4 a. If the subject accommodations or facilities, or all 5 use rights therein, are to be transferred into an owners' 6 association in order to comply with this paragraph, such 7 transfer shall take place pursuant to this subparagraph. 8 b. Prior to the transfer by each interestholder of the 9 subject accommodations and facilities, or all use rights 10 therein, to an owners' association, any lien or other 11 encumbrance against such accommodations and facilities, or use 12 rights therein, shall be made subject to a nondisturbance and 13 notice to creditors instrument pursuant to subsection (3). No 14 transfer pursuant to this subparagraph shall become effective 15 until the owners' association accepts such transfer and the 16 responsibilities set forth herein. An owners' association 17 established pursuant to this subparagraph shall comply with 18 the following provisions: 19 (I) The owners' association shall be a business entity 20 authorized and qualified to conduct business in this 21 state. Control of the board of directors of the owners' 22 association must be independent from any developer or managing 23 entity of the timeshare plan or any interestholder. 24 (II) The bylaws of the owners' association shall 25 provide that the corporation may not be voluntarily dissolved 26 without the unanimous vote of all owners of personal property 27 timeshare interests so long as any purchaser has a right to 28 occupy any portion of the timeshare property pursuant to the 29 timeshare plan. 30 (III) The owners' association shall not convey, 31 hypothecate, mortgage, assign, lease, or otherwise transfer or 63 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 encumber in any fashion any interest in or portion of the 2 timeshare property with respect to which any purchaser has a 3 right of use or occupancy unless the timeshare plan is 4 terminated pursuant to the timeshare instrument, or such 5 conveyance, hypothecation, mortgage, assignment, lease, 6 transfer, or encumbrance is approved by a vote of two-thirds 7 of all voting interests of the association and such decision 8 is declared by a court of competent jurisdiction to be in the 9 best interests of the purchasers of the timeshare plan. The 10 owners' association shall notify the division in writing 11 within 10 days after receiving notice of the filing of any 12 petition relating to obtaining such a court order. The 13 division shall have standing to advise the court of the 14 division's interpretation of the statute as it relates to the 15 petition. 16 (IV) All purchasers of the timeshare plan shall be 17 members of the owners' association and shall be entitled to 18 vote on matters requiring a vote of the owners' association as 19 provided in this chapter or the timeshare instrument. The 20 owners' association shall act as a fiduciary to the purchasers 21 of the timeshare plan. The articles of incorporation 22 establishing the owners' association shall set forth the 23 duties of the owners' association. All expenses reasonably 24 incurred by the owners' association in the performance of its 25 duties, together with any reasonable compensation of the 26 officers or directors of the owners' association, shall be 27 common expenses of the timeshare plan. 28 (V) The documents establishing the owners' association 29 shall constitute a part of the timeshare instrument. 30 (VI) For owners' associations holding property in a 31 timeshare plan located outside this state, the owners' 64 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 association holding such property shall be deemed in 2 compliance with the requirements of this subparagraph if such 3 owners' association is authorized and qualified to conduct 4 owners' association business under the laws of such 5 jurisdiction and the agreement or law governing such 6 arrangement provides substantially similar protections for the 7 purchaser as are required in this subparagraph for owners' 8 associations holding property in a timeshare plan in this 9 state. 10 (VII) The owners' association shall have appointed a 11 registered agent in this state for service of process. In the 12 event such a registered agent cannot be located, service of 13 process may be made pursuant to s. 721.265. 14 6. Personal property subject to certificate of 15 title.--If any personal property that is an accommodation or 16 facility of a timeshare plan is subject to a certificate of 17 title in this state pursuant to chapter 319 or chapter 328, 18 the following notation must be made on such certificate of 19 title pursuant to s. 319.27(1) or s. 328.15(1): 20 21 The further transfer or encumbrance of the property subject to 22 this certificate of title, or any lien or encumbrance thereon, 23 is subject to the requirements of section 721.17, Florida 24 Statutes, and the transferee or lienor agrees to be bound by 25 all of the obligations set forth therein. 26 7. 4.If the developer has previously provided a 27 certified copy of any document required by this paragraph, she 28 or he may for all subsequent disbursements substitute a true 29 and correct copy of the certified copy, provided no changes to 30 the document have been made or are required to be made. 31 65 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 8. In the event that use rights relating to an 2 accommodation or facility are transferred into a trust 3 pursuant to subparagraph 4. or into an owners' association 4 pursuant to subparagraph 5., all other interestholders, 5 including the owner of the underlying fee or underlying 6 personal property, must execute a nondisturbance and notice to 7 creditors instrument pursuant to subsection (3). 8 (d) Substitution of other assurances for escrowed funds 9 or other property.--Funds or other property escrowed as 10 provided in this section may be released from escrow to or on 11 the order of the developer upon acceptance by the director of 12 the division of other assurances pursuant to subsection (5) as 13 a substitute for such escrowed funds or other property. The 14 amount of escrowed funds or other property that may be 15 released pursuant to this paragraph shall be equal to or less 16 than the face amount of the assurances accepted by the 17 director from time to time. 18 (3) NONDISTURBANCE AND NOTICE TO CREDITORS 19 INSTRUMENT.--The nondisturbance and notice to creditors 20 instrument, when required, shall be executed by each 21 interestholder. 22 (a) The instrument shall state that: 23 1. (a)If the party seeking enforcement is not in 24 default of its obligations, the instrument may be enforced by 25 both the seller and any purchaser of the timeshare plan; 26 2.(b)The instrument shall be effective as between the 27 timeshare purchaser and interestholder despite any rejection 28 or cancellation of the contract between the timeshare 29 purchaser and developer as a result of bankruptcy proceedings 30 of the developer; and 31 66 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 3. (c)So long as a purchaser remains in good standing 2 with respect to her or his obligations under the timeshare 3 instrument, including making all payments to the managing 4 entity required by the timeshare instrument with respect to 5 the annual common expenses of the timesharethe interestholder6has any interest in the accommodations, facilities, orplan, 7 then the interestholder willfullyhonor alltherights of 8 such purchaser relating to the subject accommodation or 9 facility as reflectedtimeshare purchasersinand tothe 10 timeshare instrumentplan, will honor the purchasers' right to11cancel their contracts and receive appropriate refunds, and12will comply with all other requirements of this chapter and13rules promulgated hereunder. 14 15 The instrument shall contain language sufficient to provide 16 subsequent creditors of the developer and interestholders with 17 notice of the existence of the timeshare plan and of the 18 rights of purchasers and shall serve to protect the interest 19 of the timeshare purchasers from any claims of subsequent 20 creditors. 21 (b) Real property timeshare plans.--For real property 22 timeshare plans, the instrument shall be recorded in the 23 public records of the county in which the subject 24 accommodations or facilities are located. 25 (c) Personal property timeshare plans.--For personal 26 property timeshare plans, the instrument shall be included 27 within or attached as an exhibit to a security agreement or 28 other agreement executed by the interestholder. Constructive 29 notice of such security agreement or other agreement shall be 30 filed in the manner prescribed by chapter 679 or other 31 applicable law. 67 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (d) A copy of the recorded or filed nondisturbance and 2 notice to creditors instrument, when required, shall be 3 provided to each timeshare purchaser at the time the purchase 4 contract is executed. 5 (4) In lieu of any escrow provisions required by this 6 act, the director of the division shall have the discretion to 7 permit deposit of the funds or other property in an escrow 8 account as required by the jurisdiction in which the sale took 9 place. 10 (5)(a) In lieu of any escrows required by this 11 section, the director of the division shall have the 12 discretion to accept other assurances, including, but not 13 limited to, a surety bond issued by a company authorized and 14 licensed to do business in this state as surety or an 15 irrevocable letter of credit in an amount equal to the escrow 16 requirements of this section. 17 (b) Notwithstanding anything in chapter 718 or chapter 18 719 to the contrary, the director of the division shall have 19 the discretion to accept other assurances pursuant to 20 paragraph (a) in lieu of any requirement that completion of 21 construction of one or more accommodations or facilities of a 22 timeshare plan be accomplished prior to closing. 23 (c) In lieu of a nondisturbance and notice to 24 creditors instrument, when such an instrument is otherwise 25 required by this section, the director of the division shall 26 have the discretion to accept alternate means of protecting 27 the continuing rights of purchasers in and to the subject 28 accommodations or facilities of the timeshare plan as and for 29 the term described in the timeshare instrument, and of 30 providing effective constructive notice of such continuing 31 purchaser rights to subsequent owners of the accommodations or 68 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 facilities and to subsequent creditors of the affected 2 interestholder. 3 (d) In lieu of the requirements in 4 sub-sub-subparagraph (2)(c)3.e.(III), the director of the 5 division shall have the discretion to accept alternate means 6 of protecting the use rights of purchasers in the subject 7 accommodations and facilities of the timeshare plan against 8 unfiled and inferior claims. 9 (6) An escrow agent holding funds escrowed pursuant to 10 this section may invest such escrowed funds in securities of 11 the United States Government, or any agency thereof, or in 12 savings or time deposits in institutions insured by an agency 13 of the United States Government. The right to receive the 14 interest generated by any such investments shall be paid to 15 the party to whom the escrowed funds or other property are 16 paid unless otherwise specified by contract. 17 (7) Each escrow agent shall maintain separate books 18 and records for each timeshare plan and shall maintain such 19 books and records in accordance with good accounting 20 practices. 21 (8) An escrow agent holding escrowed funds pursuant to 22 this chapter that have not been claimed for a period of 5 23 years after the date of deposit shall make at least one 24 reasonable attempt to deliver such unclaimed funds to the 25 purchaser who submitted such funds to escrow. In making such 26 attempt, an escrow agent is entitled to rely on a purchaser's 27 last known address as set forth in the books and records of 28 the escrow agent and is not required to conduct any further 29 search for the purchaser. If an escrow agent's attempt to 30 deliver unclaimed funds to any purchaser is unsuccessful, the 31 escrow agent may deliver such unclaimed funds to the division 69 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 and the division shall deposit such unclaimed funds in the 2 Division of Florida Land Sales, Condominiums, and Mobile Homes 3 Trust Fund, 30 days after giving notice in a publication of 4 general circulation in the county in which the timeshare 5 property containing the purchaser' s timeshare interest is 6 located. The purchaser may claim the same at any time prior to 7 the delivery of such funds to the division. After delivery of 8 such funds to the division, the purchaser shall have no more 9 rights to the unclaimed funds. The escrow agent shall not be 10 liable for any claims from any party arising out of the escrow 11 agent's delivery of the unclaimed funds to the division 12 pursuant to this section. 13 (9) For each transfer of the legal title to a 14 timeshare estate by a developer, the developer shall deliver 15 an instrument evidencing such transfer to the purchaser or to 16 a title insurance agent or to the clerk of the court for 17 recording. For each transfer of the legal title to a personal 18 property timeshare interest by a developer, the developer 19 shall deliver an instrument evidencing such transfer to the 20 purchaser subject to the provisions of this section. 21 (10)(a) Any developer, seller, or escrow agent who 22 intentionally fails to comply with the provisions of this 23 section concerning the establishment of an escrow account, 24 deposits of funds into escrow, and withdrawal therefrom is 25 guilty of a felony of the third degree, punishable as provided 26 in s. 775.082, s. 775.083, or s. 775.084, or the successor 27 thereof. The failure to establish an escrow account or to 28 place funds therein as required in this section is prima facie 29 evidence of an intentional and purposeful violation of this 30 section. 31 70 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (b) Any developer, interestholder, trustee, or officer 2 or director of an owners' association who intentionally fails 3 to comply with the provisions of this section concerning the 4 establishment of a trust or owners' association, conveyances 5 of property into the trust or owners' association, and 6 conveyances or encumbrances of trust or owners' association 7 property is guilty of a felony of the third degree, punishable 8 as provided in s. 775.082, s. 775.083, or s. 775.084, or the 9 successor thereof. The failure to establish a trust or owners' 10 association, or to transfer property into the trust or owners' 11 association, or the failure of a trustee or officer or 12 director of an owners' association to comply with the trust 13 agreement, articles of incorporation, or bylaws with respect 14 to conveyances or encumbrances of trust or owners' association 15 property, as required by this section, is prima facie evidence 16 of an intentional and purposeful violation of this section. 17 Section 9. Paragraphs (a) and (d) of subsection (1), 18 paragraph (c) of subsection (2), and paragraph (c) of 19 subsection (3) of section 721.09, Florida Statutes, are 20 amended to read: 21 721.09 Reservation agreements; escrows.-- 22 (1)(a) Prior to filing the filed registeredpublic 23 offering statement with the division, a seller shall not offer 24 a timeshare plan for sale but may accept reservation deposits 25 and advertise the reservation deposit program upon approval by 26 the division of a fully executed escrow agreement and 27 reservation agreement properly filed with the division. 28 (d) A seller who has filed a reservation agreement and 29 an escrow agreement under this section may advertise the 30 reservation agreement program if the advertising material 31 meets the following requirements: 71 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 1. The seller complies with the provisions of s. 2 721.11 with respect to such advertising material. 3 2. The advertising material is limited to a general 4 description of the proposed timeshare plan, including, but not 5 limited to, a general description of the type, number, and 6 size of accommodations and facilities and the name of the 7 proposed timeshare plan. 8 3. The advertising material contains a statement that 9 the advertising material is being distributed in connection 10 with an approved reservation agreement filing only and that 11 the seller cannot offer an interest in the timeshare plan for 12 sale until a filed registeredpublic offering statement has 13 been filed with the division under this chapter. 14 (2) Each executed reservation agreement shall be 15 signed by the developer and shall contain the following: 16 (c) A statement of the obligation of the developer to 17 file a filedregisteredpublic offering statement with the 18 division prior to entering into binding contracts. 19 (3) 20 (c) The escrow agent may invest the escrowed funds in 21 securities of the United States Government, or any agency 22 thereof, or in savings or time deposits in institutions 23 insured by an agency of the United States Government. The 24 interest generated by any such investments shall be payable to 25 the party entitled to receive the escrowed funds or other 26 property. 27 Section 10. Paragraph (a) of subsection (1), 28 paragraphs (b) and (e) of subsection (6), and subsections (7), 29 (8), and (9) of section 721.11, Florida Statutes, are amended 30 to read: 31 721.11 Advertising materials; oral statements.-- 72 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (1)(a) A developer may file Alladvertising material 2must be filedwith the division for reviewby the developer3prior to use.At the request of the developer,The division 4 shall review anytheadvertising material filed for review by 5 the developer and notify the developer of any deficiencies 6 within 10 days after the filing. If the developer corrects the 7 deficiencies or if there are no deficiencies, the division 8 shall notify the developer of its approval of the advertising 9 materials. Notwithstanding anything to the contrary contained 10 in this subsection, so long as the developer uses advertising 11 materials approved by the division, following the developer's 12 request for a review, the developer shall not be liable for 13 any violation of this section or s. 721.111 with respect to 14 such advertising materials. 15 (6) Failure to provide cancellation rights or 16 disclosures as required by this subsection in connection with 17 the sale of a regulated short-term product constitutes 18 misrepresentation in accordance with paragraph (4)(a). Any 19 agreement relating to the sale of a regulated short-term 20 product must be regulated as advertising material and is 21 subject to the following: 22 (b) A purchaser of a regulated short-term product has 23 the right to cancel the agreement until midnight of the 10th 24 calendar day following the execution date of the agreement. 25 The right of cancellation may not be waived by the prospective 26 purchaser or by any other person on behalf of the prospective 27 purchaser. Notice of cancellation must be given in the same 28 manner prescribed for giving notice of cancellation under s. 29 721.10(2). If the prospective purchaser gives a valid notice 30 of cancellation or is otherwise entitled to cancel the sale, 31 the funds or other property received from or on behalf of the 73 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 prospective purchaser, or the proceeds thereof, must be 2 returned to the prospective purchaser. Such refund must be 3 made in the same manner prescribed for refunds under s. 4 721.10. 5 (e) If the seller provides the purchaser with the 6 right to cancel the purchase of a regulated short-term product 7 at any time up to 7 days prior to the purchaser's reserved use 8 of the accommodations, but in no event less than 10 days, and 9 if the seller refunds the total amount of all payments made by 10 the purchaser reduced by the proportion of any benefits the 11 purchaser has actually received prior to the effective date of 12 the cancellation, the specific value of which has been agreed 13 to between the purchaser and the seller, the short-term 14 product offer shall be exempt from the requirements of 15 paragraphs (b), (c), and (d). An agreement relating to the 16 sale of the regulated short-term product made pursuant to this 17 paragraph must contain a statement setting forth the 18 cancellation and refund rights of the prospective purchaser in 19 a manner that is consistent with this section and s. 721.10, 20 including a description of the length of the cancellation 21 right, a statement that the purchaser's intent to cancel must 22 be in writing and sent to the seller at a specified address, a 23 statement that the notice of cancellation is effective upon 24 the date sent, and a statement that any attempt to waive the 25 cancellation right is unlawful. The right of cancellation 26 provided to the purchaser pursuant to this paragraph may not 27 be waived by the prospective purchaser or by any other person 28 on behalf of the prospective purchaser. Notice of cancellation 29 must be given in the same manner prescribed for giving notice 30 of cancellation pursuant to s. 721.10(2). If the prospective 31 purchaser gives a valid notice of cancellation, or is 74 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 otherwise entitled to cancel the sale, the funds or other 2 property received from or on behalf of the prospective 3 purchaser, or the proceeds thereof, shall be returned to the 4 prospective purchaser. Such refund shall be made in the manner 5 prescribed for refunds under s. 721.10. 6 (7) Notwithstanding the provisions of s. 721.05(7) 7 (6)(b), a seller may portray possible accommodations or 8 facilities to prospective purchasers in advertising material, 9 or a purchaser public offering statement, without such 10 accommodations or facilities being available for use by 11 purchasers so long as the advertising material or purchaser 12 public offering statement complies with the provisions of 13 subsection (4). 14 (8) Notwithstanding the provisions of s. 721.05(7) 15(6)(b), a developer may portray possible accommodations or 16 facilities to prospective purchasers by disseminating oral or 17 written statements regarding same to broadcast or print media 18 with no obligation on the developer's part to actually 19 construct such accommodations or facilities or to file such 20 accommodations or facilities with the division, but only so 21 long as such oral or written statements are not considered 22 advertising material pursuant to paragraph (3)(e). 23 (9) Notwithstanding the provisions of s. 721.05(7) 24(6)(b), a seller of a multisite timeshare plan may portray a 25 possible component site to prospective purchasers with no 26 accommodations or facilities located at such component site 27 being available for use by purchasers so long as the seller 28 satisfies the following requirements: 29 (a) A developer of a multisite timeshare plan may 30 disseminate oral or written statements to broadcast or print 31 media describing a possible component site with no obligation 75 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 on the developer's part to actually add such component site to 2 the multisite timeshare plan or to amend the developer's 3 filing with the division, but only so long as such oral or 4 written statements are not considered advertising material 5 pursuant to paragraph (3)(e). 6 (b) A seller may make representations to purchasers in 7 advertising material or in a purchaser public offering 8 statement regarding the possible accommodations and facilities 9 of a possible component site without such accommodations or 10 facilities being available for use by purchasers so long as 11 the advertising material or purchaser public offering 12 statement complies with the provisions of subsection (4). 13 (c) In the event a seller makes any of the 14 representations permitted by paragraph (b), the purchase 15 agreement must contain the following conspicuous disclosure 16 unless and until such time as the developer has committed 17 itself in the timeshare instrument to adding the possible 18 component site to the multisite timeshare plan, at which time 19 the seller may portray the component site pursuant to the 20 timeshare instrument without restriction: 21 22 [Description of possible component site] is only a possible 23 component site which may never be added to the multisite 24 timeshare plan (or multisite vacation ownership plan or 25 multisite vacation plan or vacation club). Do not purchase an 26 interest in the multisite timeshare plan (or multisite 27 vacation ownership plan or multisite vacation plan or vacation 28 club) in reliance upon the addition of this component site. 29 (d) Notwithstanding anything contained in this chapter 30 to the contrary, a developer or managing entity may 31 communicate with existing purchasers regarding possible 76 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 component sites without restriction, so long as all oral and 2 written statements made to existing purchasers pursuant to 3 this subsection comply with the provisions of subsection (4). 4 (e) Any violation of this subsection by a developer, 5 seller, or managing entity shall constitute a violation of 6 this chapter. Any violation of this subsection with respect to 7 a purchaser whose purchase has not yet closed shall be deemed 8 to provide that purchaser with a new 10-day voidability 9 period. 10 Section 11. Subsection (1) of section 721.12, Florida 11 Statutes, is amended to read: 12 721.12 Recordkeeping by seller.--Each seller of a 13 timeshare plan shall maintain among its business records the 14 following: 15 (1) A copy of each contract for the sale of a 16 timeshare interest, which contract has not been canceled. If a 17 timeshare estate is being sold, the seller is required to 18 retain a copy of the contract only until a deed of conveyance, 19 agreement for deed, or lease is recorded in the office of the 20 clerk of the circuit court in the county wherein the plan is 21 located. If a personal property timeshare plan is being sold, 22 the seller is required to retain a copy of the contract only 23 until a certificate of transfer, agreement for transfer, 24 lease, or other instrument of transfer that fully complies 25 with s. 721.08 is delivered to the purchaser. 26 Section 12. Paragraphs (a) and (b) of subsection (1), 27 paragraph (b) of subsection (2), paragraphs (c), (d), and (e) 28 of subsection (3), paragraph (g) of subsection (6), and 29 subsections (4) and (8) of section 721.13, Florida Statutes, 30 are amended, subsection (9) is renumbered as subsection (10), 31 77 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 and new subsections (9) and (11) are added to that section, to 2 read: 3 721.13 Management.-- 4 (1)(a) For each timeshare plan, the developer shall 5 provide for a managing entity, which shall be either the 6 developer, a separate manager or management firm, or an 7 owners' association. Any owners' association shall be created 8 prior to the first closing recordingof the sale of a 9 timeshare interestinstrument. 10 (b)1. With respect to a timeshare plan which is also 11 regulated under chapter 718 or chapter 719, or which contains 12 a mandatory owners' association, the board of administration 13 of the owners' association shall be considered the managing 14 entity of the timeshare plan. 15 2. During any period of time in which such owners' 16 association has entered into a contract with a manager or 17 management firm to provide some or all of the management 18 services to the timeshare plan, both the board of 19 administration and the manager or management firm shall be 20 considered the managing entity of the timeshare plan and shall 21 be jointly and severally responsible for the faithful 22 discharge of the duties of the managing entity. 23 3. An owners' association which is the managing entity 24 of a timeshare plan that includes condominium units or 25 cooperative units shall not be considered a condominium 26 association pursuant to the provisions of chapter 718 or a 27 cooperative association pursuant to the provisions of chapter 28 719, unless such owners' association also operates the entire 29 condominium pursuant to s. 718.111 or the entire cooperative 30 pursuant to s. 719.104. 31 (2) 78 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (b) The managing entity shall invest the operating and 2 reserve funds of the timeshare plan in accordance with s. 3 518.11(1); however, the managing entity shall give safety of 4 capital greater weight than production of income. In no event 5 shall the managing entity invest timeshare plan funds with a 6 developer or with any entity that is not independent of any 7 developer or any managing entity within the meaning of s. 8 721.05(20) (18), and in no event shall the managing entity 9 invest timeshare plan funds in notes and mortgages related in 10 any way to the timeshare plan. 11 (3) The duties of the managing entity include, but are 12 not limited to: 13 (c)1. Providing each year to all purchasers an 14 itemized annual budget which shall include all estimated 15 revenues and expenses. The budget shall be in the form 16 required by s. 721.07(5)(u). The budgetandshall be the final 17 budget adopted by the managing entity for the current fiscal 18 year. The final adopted budget is not required to be delivered 19 if the managing entity has previously delivered a proposed 20 annual budget for the current fiscal year to purchasers in 21 accordance with chapter 718 or chapter 719, and the managing 22 entity includes a description of any changes in the adopted 23 budget with the assessment notice and a disclosure regarding 24 the purchasers' right to receive a copy of the adopted budget 25 if desired. The budget shall contain, as a footnote or 26 otherwise, any related party transaction disclosures or notes 27 which appear in the audited financial statements of the 28 managing entity for the previous budget year as required by 29 paragraph (e). A copy of the final budget shall be filed with 30 the division for review within 30 days after the beginning of 31 each fiscal year together with a statement of the number of 79 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 periods of 7-day annual use availability that exist within the 2 timeshare plan, including those periods filed for sale by the 3 developer but not yet committed to the timeshare plan, for 4 which annual fees are required to be paid to the division 5 under s. 721.27. 6 2. Notwithstanding anything contained in chapter 718 7 or chapter 719 to the contrary, the board of administration of 8 an owners' association which serves as the managing entity may 9 from time to time reallocate reserves for deferred maintenance 10 and capital expenditures required by s. 721.07(5)(u)3.a.(XI) 11 from any deferred maintenance or capital expenditure reserve 12 account to any other deferred maintenance or capital 13 expenditure reserve account or accounts in its discretion 14 without the consent of purchasers of the timeshare plan. Funds 15 in any deferred maintenance or capital expenditure reserve 16 account may not be transferred to any operating account 17 without the consent of a majority of the purchasers of the 18 timeshare plan. The managing entity may from time to time 19 transfer excess funds in any operating account to any deferred 20 maintenance or capital expenditure reserve account without the 21 vote or approval of purchasers of the timeshare plan. In the 22 event any amount of reserves for accommodations and facilities 23 of a timeshare plan containing timeshare licenses or personal 24 property timeshare interests exists at the end of the term of 25 the timeshare plan, such reserves shall be refunded to 26 purchasers on a pro rata basis. 27 (d)1. Maintenance of all books and records concerning 28 the timeshare plan so that all such books and records are 29 reasonably available for inspection by any purchaser or the 30 authorized agent of such purchaser. For purposes of this 31 subparagraph, the books and records of the timeshare plan 80 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 shall be considered "reasonably available" if copies of the 2 requested portions are delivered to the purchaser or the 3 purchaser's agent within 7 days after ofthe date the managing 4 entity receives a written request for the records signed by 5 the purchaser. The managing entity may charge the purchaser a 6 reasonable fee for copying the requested information not to 7 exceed 25 cents per page. However, any purchaser or agent of 8 such purchaser shall be permitted to personally inspect and 9 examine the books and records wherever located at any 10 reasonable time, under reasonable conditions, and under the 11 supervision of the custodian of those records. The custodian 12 shall supply copies of the records where requested and upon 13 payment of the copying fee. No fees other than those set forth 14 in this section may be charged for the providing of, 15 inspection, or examination of books and records. All books and 16 financial records of the timeshare plan must be maintained in 17 accordance with generally accepted accounting practices. 18 2. If the books and records of the timeshare plan are 19 not maintained on the premises of the accommodations and 20 facilities of the timeshare plan, the managing entity shall 21 inform the division in writing of the location of the books 22 and records and the name and address of the person who acts as 23 custodian of the books and records at that location. In the 24 event that the location of the books and records changes, the 25 managing entity shall notify the division of the change in 26 location and the name and address of the new custodian within 27 30 days afterofthe date the books and records are moved. The 28 purchasers shall be notified of the location of the books and 29 records and the name and address of the custodian in the copy 30 of the annual budget provided to them pursuant to paragraph 31 (c). 81 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 3. The division is authorized to adopt rules which 2 specify those items and matters that shall be included in the 3 books and records of the timeshare plan and which specify 4 procedures to be followed in requesting and delivering copies 5 of the books and records. 6 4. Notwithstanding any provision of chapter 718 or 7 chapter 719 to the contrary, the managing entity may not 8 furnish the name, address, or electronic mail address of any 9 purchaser to any other purchaser or authorized agent thereof 10 unless the purchaser whose name, andaddress, or electronic 11 mail address isarerequested first approves the disclosure in 12 writing. 13 (e) Arranging for an annual audit of the financial 14 statements of the timeshare plan by a certified public 15 accountant licensed by the Board of Accountancy of the 16 Department of Business and Professional Regulation, in 17 accordance with generally accepted auditing standards as 18 defined by the rules of the Board of Accountancy of the 19 Department of Business and Professional Regulation. The 20 financial statements required by this section must be prepared 21 on an accrual basis using fund accounting, and must be 22 presented in accordance with generally accepted accounting 23 principles. A copy of the audited financial statements must be 24 filed with the division for review and forwarded to the board 25 of directors and officers of the owners' association, if one 26 exists, no later than 5 calendar months after the end of the 27 timeshare plan's fiscal year. If no owners' association 28 exists, each purchaser must be notified, no later than 5 29 months after the end of the timeshare plan's fiscal year, that 30 a copy of the audited financial statements is available upon 31 request to the managing entity. Notwithstanding any 82 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 requirement of s. 718.111(13) or s. 719.104(4), the audited 2 financial statements required by this section are the only 3 annual financial reporting requirements for timeshare 4 condominiums or timeshare cooperatives. 5 (4) The managing entity shall maintain among its 6 records and provide to the division upon request a complete 7 list of the names and addresses of all purchasers and owners 8 of timeshare units in the timeshare plan. The managing entity 9 shall update this list no less frequently than quarterly. 10 Pursuant to paragraph (3)(d), the managing entity may not 11 publish this owner's list or provide a copy of it to any 12 purchaser or to any third party other than the division. 13 However, the managing entity shall to those persons listed on 14 the owner's list materials provided by any purchaser, upon the 15 written request of that purchaser, if the purpose of the 16 mailing is to advance legitimate owners' association business, 17 such as a proxy solicitation for any purpose, including the 18 recall of one or more board members elected by the owners or 19 the discharge of the manager or management firm. The use of 20 any proxies solicited in this manner must comply with the 21 provisions of the timeshare instrument and this chapter. A 22 mailing requested for the purpose of advancing legitimate 23 owners' association business shall occur within 30 days after 24 receipt of a request from a purchaser. The board of 25 administration of the owners' association shall be responsible 26 for determining the appropriateness of any mailing requested 27 pursuant to this subsection. The purchaser who requests the 28 mailing must reimburse the owners' association in advance for 29 the owners' association's actual costs in performing the 30 mailing. It shall be a violation of this chapter and, if 31 applicable, of part VIII of chapter 468, for the board of 83 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 administration or the manager or management firm to refuse to 2 mail any material requested by the purchaser to be mailed, 3 provided the sole purpose of the materials is to advance 4 legitimate owners' association business. If the purpose of the 5 mailing is a proxy solicitation to recall one or more board 6 members elected by the owners or to discharge the manager or 7 management firm and the managing entity does not mail the 8 materials within 30 days after receipt of a request from a 9 purchaser, the circuit court in the county where the timeshare 10 plan is located may, upon application from the requesting 11 purchaser, summarily order the mailing of the materials solely 12 related to the recall of one or more board members elected by 13 the owners or the discharge of the manager or management firm. 14 The court shall dispose of an application on an expedited 15 basis. In the event of such an order, the court may order the 16 managing entity to pay the purchaser's costs, including 17 attorney's fees reasonably incurred to enforce the purchaser's 18 rights, unless the managing entity can prove it refused the 19 mailing in good faith because of a reasonable basis for doubt 20 about the legitimacy of the mailing. 21 (6) 22 (g) A managing entity shall have breached its 23 fiduciary duty described in subsection (2) in the event it 24 enforces the denial of use pursuant to paragraph (b) against 25 any one purchaser or group of purchasers without similarly 26 enforcing it against all purchasers, including all developers 27 and owners of the underlying fee or underlying personal 28 property; however, a managing entity shall not be required to 29 solicit rentals pursuant to paragraph (f) for every delinquent 30 purchaser. A managing entity shall also have breached its 31 fiduciary duty in the event an error in the books and records 84 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 of the timeshare plan results in a denial of use pursuant to 2 this subsection of any purchaser who is not, in fact, 3 delinquent. In addition to any remedies otherwise available to 4 purchasers of the timeshare plan arising from such breaches of 5 fiduciary duty, such breach shall also constitute a violation 6 of this chapter. In addition, any purchaser receiving a notice 7 of delinquency pursuant to paragraph (b), or any third party 8 claiming under such purchaser pursuant to paragraph (b), may 9 immediately bring an action for injunctive or declaratory 10 relief against the managing entity seeking to have the notice 11 invalidated on the grounds that the purchaser is not, in fact, 12 delinquent, that the managing entity failed to follow the 13 procedures prescribed by this section, or on any other 14 available grounds. The prevailing party in any such action 15 shall be entitled to recover his or her reasonable attorney's 16 fees from the losing party. 17 (8) Notwithstanding anything to the contrary in s. 18 718.110, s. 718.113, s. 718.114, or s. 719.1055, the board of 19 administration of any owners' association that operates a 20 timeshare condominium pursuant to s. 718.111, or a timeshare 21 cooperative pursuant to s. 719.104, shall have the power to 22 make material alterations or substantial additions to the 23 accommodations or facilities of such timeshare condominium or 24 timeshare cooperative without the approval of the owners' 25 association. However, if the timeshare condominium or 26 timeshare cooperative contains any residential units that are 27 not subject to the timeshare plan, such action by the board of 28 administration must be approved by a majority of the owners of 29 such residential units. Unless otherwise provided in the 30 timeshare instrument as originally recorded, no such amendment 31 may change the configuration or size of any accommodation in 85 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 any material fashion, or change the proportion or percentage 2 by which a member of the owners' association shares the common 3 expenses, unless the record owners of the affected units or 4 timeshare interests and all record owners of liens on the 5 affected units or timeshare interests join in the execution of 6 the amendment. 7 (9) All notices or other information sent by a board 8 of administration of an owners' association may be delivered 9 to a purchaser by electronic mail, provided that the purchaser 10 first consents electronically to the use of electronic mail 11 for notice purposes in a manner that reasonably demonstrates 12 that the purchaser has the ability to access the notice by 13 electronic mail. Proxies or written consents on votes of any 14 owners' association may be received by electronic mail, shall 15 have legal effect, and may be utilized for votes of an owners' 16 association, provided that the electronic signature is 17 authenticated through use of a password, cryptography 18 software, or other reasonable means and that proof of such 19 authentication is made available to the board of directors. 20 (10) (9)Any failure of the managing entity to 21 faithfully discharge the fiduciary duty to purchasers imposed 22 by this section or to otherwise comply with the provisions of 23 this section shall be a violation of this chapter and of part 24 VIII of chapter 468. 25 (11) Notwithstanding the other provisions of this 26 section, personal property timeshare plans are only subject to 27 the provisions of subsections (1)(a)-(d), (2)(a), (3)(a)-(h), 28 (5), (6), (9), and (10). 29 Section 13. Subsection (4) is added to section 721.14, 30 Florida Statutes, to read: 31 721.14 Discharge of managing entity.-- 86 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (4) This section shall not apply to personal property 2 timeshare plans. 3 Section 14. Paragraph (c) of subsection (2) of section 4 721.15, Florida Statutes, is amended, and subsection (10) is 5 added to that section, to read: 6 721.15 Assessments for common expenses.-- 7 (2) 8 (c) For the purpose of calculating the obligation of a 9 developer under a guarantee pursuant to paragraph (b), 10 depreciation expenses related to real property shall be 11 excluded from common expenses incurred during the guarantee 12 period, except that for real property that is used for the 13 production of fees, revenues, or other income, depreciation 14 expenses shall be excluded only to the extent that they exceed 15 the net income from the production of such fees, revenues, or 16 other income. 17 (10) This section shall not apply to personal property 18 timeshare plans. 19 Section 15. Subsection (6) is added to section 721.16, 20 Florida Statutes, to read: 21 721.16 Liens for overdue assessments; liens for labor 22 performed on, or materials furnished to, a timeshare unit.-- 23 (6) This section shall not apply to personal property 24 timeshare plans. 25 Section 16. Section 721.17, Florida Statutes, is 26 amended to read: 27 721.17 Transfer of interest.--Except in the case of a 28 timeshare plan subject to the provisions of chapter 718 or 29 chapter 719, no developer, orowner of the underlying fee, or 30 owner of the underlying personal property shall sell, lease, 31 assign, mortgage, or otherwise transfer his or her interest in 87 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 the accommodations and facilities of the timeshare plan except 2 by an instrument evidencing the transfer recorded in the 3 public records of the county in which such accommodations and 4 facilities are located, or, with respect to personal property 5 timeshare plans, in full compliance with s. 721.08. The 6 instrument shall be executed by both the transferor and 7 transferee and shall state: 8 (1) That its provisions are intended to protect the 9 rights of all purchasers of the plan. 10 (2) That its terms may be enforced by any prior or 11 subsequent timeshare purchaser so long as that purchaser is 12 not in default of his or her obligations. 13 (3) That so long as a purchaser remains in good 14 standing with respect to her or his obligations under the 15 timeshare instrument, including making all payments to the 16 managing entity required by the timeshare instrument with 17 respect to the annual common expenses of the timeshare plan, 18 the transferee shall willfullyhonor alltherights of such 19 purchaser relating to the subject accommodation or facility as 20 reflectedthe purchasers to occupy and usethe accommodations21and facilities as providedintheir original contracts andthe 22 timeshare instrumentinstruments. 23 (4) That the transferee will fully honor all rights of 24 timeshare purchasers to cancel their contracts and receive 25 appropriate refunds. 26 (5) That the obligations of the transferee under such 27 instrument will continue to exist despite any cancellation or 28 rejection of the contracts between the developer and purchaser 29 arising out of bankruptcy proceedings. 30 31 88 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 Should any transfer of the interest of the developer, orowner 2 of the underlying fee, or owner of the underlying property 3 occur in a manner which is not in compliance with this 4 section, the terms set forth in this section shall be presumed 5 to be a part of the transfer and shall be deemed to be 6 included in the instrument of transfer. Notice shall be mailed 7 to each purchaser of record within 30 days afterofthe 8 transfer unless such transfer does not affect the purchaser's 9 rights in or use of the timeshare plan. Persons who hold 10 mortgages or liens on the property constituting a timeshare 11 plan before the filedregisteredpublic offering statement of 12 such plan is approved by the division shall not be considered 13 transferees for the purposes of this section. 14 Section 17. Section 721.18, Florida Statutes, is 15 amended to read: 16 721.18 Exchange programs; filing of information and 17 other materials; filing fees; unlawful acts in connection with 18 an exchange program.-- 19 (1) If a purchaser is offered the opportunity to 20 subscribe to an exchange program, the seller shall deliver to 21 the purchaser, together with the purchaser public offering 22 statement, and prior to the offering or execution of any 23 contract between the purchaser and the company offering the 24 exchange program, written information regarding such exchange 25 program; or, if the exchange company is dealing directly with 26 the purchaser, the exchange company shall deliver to the 27 purchaser, prior to the initial offering or execution of any 28 contract between the purchaser and the company offering the 29 exchange program, written information regarding such exchange 30 program. In either case, the purchaser shall certify in 31 writing to the receipt of such information. Such information 89 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 shall include, but is not limited to, the following 2 information, the form and substance of which shall first be 3 approved by the division in accordance with subsection (2): 4 (a) The name and address of the exchange company. 5 (b) The names of all officers, directors, and 6 shareholders of the exchange company. 7 (c) Whether the exchange company or any of its 8 officers or directors has any legal or beneficial interest in 9 any developer, seller, or managing entity for any timeshare 10 plan participating in the exchange program and, if so, the 11 name and location of the timeshare plan and the nature of the 12 interest. 13 (d) Unless otherwise stated, a statement that the 14 purchaser's contract with the exchange company is a contract 15 separate and distinct from the purchaser's contract with the 16 seller of the timeshare plan. 17 (e) Whether the purchaser's participation in the 18 exchange program is dependent upon the continued affiliation 19 of the timeshare plan with the exchange program. 20 (f) A statement that Whetherthe purchaser's 21 participation in the exchange program is voluntary. This 22 statement is not required to be given by the seller or 23 managing entity of a multisite timeshare plan to purchasers in 24 the multisite timeshare plan. 25 (g) A complete and accurate description of the terms 26 and conditions of the purchaser's contractual relationship 27 with the exchange program and the procedure by which changes 28 thereto may be made. 29 (h) A complete and accurate description of the 30 procedure to qualify for and effectuate exchanges. 31 90 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (i) A complete and accurate description of all 2 limitations, restrictions, or priorities employed in the 3 operation of the exchange program, including, but not limited 4 to, limitations on exchanges based on seasonality, timeshare 5 unit size, or levels of occupancy, expressed in boldfaced 6 type, and, in the event that such limitations, restrictions, 7 or priorities are not uniformly applied by the exchange 8 program, a clear description of the manner in which they are 9 applied. 10 (j) Whether exchanges are arranged on a 11 space-available basis and whether any guarantees of 12 fulfillment of specific requests for exchanges are made by the 13 exchange program. 14 (k) Whether and under what circumstances a purchaser, 15 in dealing with the exchange program, may lose the use and 16 occupancy of her or his timeshare period in any properly 17 applied for exchange without her or his being provided with 18 substitute accommodations by the exchange program. 19 (l) The fees or range of fees for membership or 20 participation by purchasersin the exchange program by 21 purchasers, including any conversion or other fees payable to 22 third parties, a statement whether any such fees may be 23 altered by the exchange company, and the circumstances under 24 which alterations may be made. 25 (m) The name and address of the site of each 26accommodation or facility included in thetimeshare planplans27 participating in the exchange program. 28 (n) The number of the timeshare units in each 29 timeshare plan which are available for occupancy and which 30 qualify for participation in the exchange program, expressed 31 91 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 within the following numerical groupings: 1-5; 6-10; 11-20; 2 21-50; and 51 and over. 3 (o) The number of currently enrolled purchasers for 4 each timeshare plan participating in the exchange program, 5 expressed within the following numerical groupings: 1-100; 6 101-249; 250-499; 500-999; and 1,000 and over; and a statement 7 of the criteria used to determine those purchasers who are 8 currently enrolled with the exchange program. 9 (p) The disposition made by the exchange company of 10 timeshare periods deposited with the exchange program by 11 purchasers enrolled in the exchange program and not used by 12 the exchange company in effecting exchanges. 13 (q) The following information, which shall be 14 independently audited by a certified public accountant or 15 accounting firm in accordance with the standards of the 16 Accounting Standards Board of the American Institute of 17 Certified Public Accountants and reported annually beginning18no later than July 1, 1982: 19 1. The number of purchasers currently enrolled in the 20 exchange program. 21 2. The number of accommodations and facilities that 22 have current written affiliation agreements with the exchange 23 program. 24 3. The percentage of confirmed exchanges, which is the 25 number of exchanges confirmed by the exchange program divided 26 by the number of exchanges properly applied for, together with 27 a complete and accurate statement of the criteria used to 28 determine whether an exchange request was properly applied 29 for. 30 4. The number of timeshare periods for which the 31 exchange program has an outstanding obligation to provide an 92 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 exchange to a purchaser who relinquished a timeshare period 2 during the year in exchange for a timeshare period in any 3 future year. 4 5. The number of exchanges confirmed by the exchange 5 program during the year. 6 (r) A statement in boldfaced type to the effect that 7 the percentage described in subparagraph (q)3. is a summary of 8 the exchange requests entered with the exchange program in the 9 period reported and that the percentage does not indicate the 10 probabilities of a purchaser's being confirmed to any specific 11 choice or range of choices. 12 (2) Each exchange company offering an exchange program 13 to purchasers in this state shall file with the division for 14 review the information specified in subsection (1), together 15 with any membership agreement and application between the 16 purchaser and the exchange company, and the audit specified in 17 subsection (1) on or before June 1 of each year. However, an 18 exchange company shall make its initial filing at least 20 19 days prior to offering an exchange program to any purchaser in 20 this state. Each filing shall be accompanied by an annual 21 filing fee of $500. Within 20 days after ofreceipt of such 22 filing, the division shall determine whether the filing is 23 adequate to meet the requirements of this section and shall 24 notify the exchange company in writing that the division has 25 either approved the filing or found specified deficiencies in 26 the filing. If the division fails to respond within 20 days, 27 the filing shall be deemed approved. The exchange company may 28 correct the deficiencies; and, within 10 days after receipt of 29 corrections from the exchange company, the division shall 30 notify the exchange company in writing that the division has 31 either approved the filing or found additional specified 93 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 deficiencies in the filing. If the exchange company fails to 2 adequately respond to any deficiency notice within 10 days, 3 the division may reject the filing. Subsequent to such 4 rejection, a new filing fee and a new division initial review 5 period pursuant to this subsection shall apply to any refiling 6 or further review of the rejected filing. 7 (a) Any material change to an approved exchange 8 company filing shall be filed with the division for approval 9 as an amendment prior to becoming effective. Each amendment 10 filing shall be accompanied by a filing fee of $100. The 11 exchange company may correct the deficiencies; and, within 10 12 days after receipt of corrections from the exchange company, 13 the division shall notify the exchange company in writing that 14 the division has either approved the filing or found 15 additional specified deficiencies in the filing. Each approved 16 amendment to the approved exchange company filing, other than 17 an amendment that does not materially alter or modify the 18 exchange program in a manner that is adverse to a purchaser, 19 as determined by the exchange company in its reasonable 20 discretion, shall be delivered to each purchaser who has not 21 closed. An approved exchange program filing is required to be 22 updated with respect to added or deleted resorts only once 23 each year, and such annual update shall not be deemed to be a 24 material change to the filing. 25 (b) If at any time the division determines that any of 26 such information supplied by an exchange company fails to meet 27 the requirements of this section, the division may undertake 28 enforcement action against the exchange company in accordance 29 with the provision of s. 721.26. 30 (3) No developer shall have any liability with respect 31 to any violation of this chapter arising out of the 94 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 publication by the developer of information provided to it by 2 an exchange company pursuant to this section. No exchange 3 company shall have any liability with respect to any violation 4 of this chapter arising out of the use by a developer of 5 information relating to an exchange program other than that 6 provided to the developer by the exchange company. 7 (4) At the request of the exchange company, the 8 division shall review any audio, written, or visual 9 publications or materials relating to an exchange company or 10 an exchange program shall befiled for review by the exchange 11 company and shall notify the exchange company of any 12 deficiencies within 10with the division within 3days after 13 the filingof their use. If the exchange company corrects the 14 deficiencies or if there are no deficiencies, the division 15 shall notify the exchange company of its approval of the 16 advertising materials. If the exchange company fails to 17 adequately respond to any deficiency notice within 10 days, 18 the division may reject the advertising materials. Subsequent 19 to such rejection, a new division initial review period 20 pursuant to this subsection shall apply to any refiling or 21 further review. 22 (5) The failure of an exchange company to observe the 23 requirements of this section, or the use of any unfair or 24 deceptive act or practice in connection with the operation of 25 an exchange program, is a violation of this chapter. 26 Section 18. Section 721.19, Florida Statutes, is 27 amended to read: 28 721.19 Provisions requiring purchase or lease of 29 timeshare property by owners' association or purchasers; 30 validity.--In any timeshare plan in which timeshare estates or 31 personal property timeshare interests are sold, no grant or 95 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 reservation made by a declaration, lease, or other document, 2 nor any contract made by the developer, managing entity, or 3 owners' association, which requires the owners' association or 4 purchasers to purchase or lease any portion of the timeshare 5 property shall be valid unless approved by a majority of the 6 purchasers other than the developer, after more than 50 7 percent of the timeshare periods have been sold. 8 Section 19. Section 721.20, Florida Statutes, is 9 amended to read: 10 721.20 Licensing requirements; suspension or 11 revocation of license; exceptions to applicability; collection 12 of advance fees for listings unlawful.-- 13 (1) Any seller of a timeshare plan must be a licensed 14 real estate salesperson, broker, or broker-salesperson as 15 defined in s. 475.01, except as provided in s. 475.011. 16 (2) Solicitors who engage only in the solicitation of 17 prospective purchasers and any purchaser who refers no more 18 than 20 people to a developer per year or who otherwise 19 provides testimonials on behalf of a developer are exempt from 20 the provisions of chapter 475. 21 (3) A solicitor who has violated the provisions of 22 chapter 468, chapter 718, chapter 719, this chapter, or the 23 rules of the division governing timesharing shall be subject 24 to the provisions of s. 721.26. Any developer or other person 25 who supervises, directs, or engages the services of a 26 solicitor shall be liable for any violation of the provisions 27 of chapter 468, chapter 718, chapter 719, this chapter, or the 28 rules of the division governing timesharing committed by such 29 solicitor. 30 (4) County and municipal governments shall have the 31 authority to adopt codes of conduct and regulations to govern 96 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 solicitor activity conducted on public property, including 2 providing for the imposition of penalties prescribed by a 3 schedule of fines adopted by ordinance for violations of any 4 such code of conduct or regulation. Any violation of any such 5 adopted code of conduct or regulation shall not constitute a 6 separate violation of this chapter. This subsection is not 7 intended to restrict or invalidate any local code of conduct 8 or regulation. 9 (5) This section does not apply to those individuals 10 who offer for sale only timeshare interests in timeshare 11 property located outside this state and who do not engage in 12 any sales activity within this state or to timeshare plans 13 which are registered with the Securities and Exchange 14 Commission. For the purposes of this section, both timeshare 15 licenses and timeshare estates are considered to be interests 16 in real property. 17 (6) Notwithstanding the provisions of s. 475.452, it 18 is unlawful for any broker, salesperson, or broker-salesperson 19 to collect any advance fee for the listing of any timeshare 20 estate or timeshare license. 21 (7) It is unlawful for any broker, salesperson, or 22 broker-salesperson to collect any advance fee for the listing 23 of a personal property timeshare interest. 24 (8) Subsections (1), (2), and (3) do not apply to 25 persons who offer personal property timeshare plans. 26 Section 20. Subsection (6) is added to section 721.24, 27 Florida Statutes, to read: 28 721.24 Firesafety.-- 29 (6) Accommodations and facilities of personal property 30 timeshare plans shall be exempt from the requirements of this 31 section. 97 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 Section 21. Paragraphs (a), (d), and (e) of subsection 2 (5) of section 721.26, Florida Statutes, are amended to read: 3 721.26 Regulation by division.--The division has the 4 power to enforce and ensure compliance with the provisions of 5 this chapter, except for parts III and IV, using the powers 6 provided in this chapter, as well as the powers prescribed in 7 chapters 498, 718, and 719. In performing its duties, the 8 division shall have the following powers and duties: 9 (5) Notwithstanding any remedies available to 10 purchasers, if the division has reasonable cause to believe 11 that a violation of this chapter, or of any division rule or 12 order promulgated or issued pursuant to this chapter, has 13 occurred, the division may institute enforcement proceedings 14 in its own name against any regulated party, as such term is 15 defined in this subsection: 16 (a)1. "Regulated party," for purposes of this section, 17 means any developer, exchange company, seller, managing 18 entity, owners' association, owners' association director, 19 owners' association officer, manager, management firm, escrow 20 agent, trustee, any respective assignees or agents, or any 21 other person having duties or obligations pursuant to this 22 chapter. 23 2. Any person who materially participates in any offer 24 or disposition of any interest in, or the management or 25 operation of, a timeshare plan in violation of this chapter or 26 relevant rules involving fraud, deception, false pretenses, 27 misrepresentation, or false advertising or the disbursement, 28 concealment, or diversion of any funds or assets, which 29 conduct adversely affects the interests of a purchaser, and 30 which person directly or indirectly controls a regulated party 31 or is a general partner, officer, director, agent, or employee 98 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 of such regulated party, shall be jointly and severally liable 2 under this subsection with such regulated party, unless such 3 person did not know, and in the exercise of reasonable care 4 could not have known, of the existence of the facts giving 5 rise to the violation of this chapter. A right of contribution 6 shall exist among jointly and severally liable persons 7 pursuant to this paragraph. 8 (d)1. The division may bring an action in circuit 9 court for declaratory or injunctive relief or for other 10 appropriate relief, including restitution. 11 2. The division shall have broad authority and 12 discretion to petition the circuit court to appoint a receiver 13 with respect to any managing entity which fails to perform its 14 duties and obligations under this chapter with respect to the 15 operation of a timeshare plan. The circumstances giving rise 16 to an appropriate petition for receivership under this 17 subparagraph include, but are not limited to: 18 a. Damage to or destruction of any of the 19 accommodations or facilities of a timeshare plan, where the 20 managing entity has failed to repair or reconstruct same. 21 b. A breach of fiduciary duty by the managing entity, 22 including, but not limited to, undisclosed self-dealing or 23 failure to timely assess, collect, or disburse the common 24 expenses of the timeshare plan. 25 c. Failure of the managing entity to operate the 26 timeshare plan in accordance with the timeshare instrument and 27 this chapter. 28 29 If, under the circumstances, it appears that the events giving 30 rise to the petition for receivership cannot be reasonably and 31 timely corrected in a cost-effective manner consistent with 99 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 the timeshare instrument, the receiver may petition the 2 circuit court to implement such amendments or revisions to the 3 timeshare instrument as may be necessary to enable the 4 managing entity to resume effective operation of the timeshare 5 plan, or to enter an order terminating the timeshare plan, or 6 to enter such further orders regarding the disposition of the 7 timeshare property as the court deems appropriate, including 8 the disposition and sale of the timeshare property held by the 9 owners' association or the purchasers. In the event of a 10 receiver's sale, all rights, title, and interest held by the 11 owners' association or any purchaser shall be extinguished and 12 title shall vest in the buyer. This provision applies to 13 timeshare estates, personal property timeshare interests, and 14 timeshare licenses. All reasonable costs and fees of the 15 receiver relating to the receivership shall become common 16 expenses of the timeshare plan upon order of the court. 17 3. The division may revoke its approval of any filing 18 for any timeshare plan for which a petition for receivership 19 has been filed pursuant to this paragraph. 20 (e)1. The division may impose a penalty against any 21 regulated party for a violation of this chapter or any rule 22 adopted thereunder. A penalty may be imposed on the basis of 23 each day of continuing violation, but in no event may the 24 penalty for any offense exceed $10,000. All accounts collected 25 shall be deposited with the Treasurer to the credit of the 26 Division of Florida Land Sales, Condominiums, and Mobile Homes 27 Trust Fund. 28 2.a. If a regulated party fails to pay a penalty, the 29 division shall thereupon issue an order directing that such 30 regulated party cease and desist from further operation until 31 such time as the penalty is paid; or the division may pursue 100 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 enforcement of the penalty in a court of competent 2 jurisdiction. 3 b. If an owners' association or managing entity fails 4 to pay a civil penalty, the division may pursue enforcement in 5 a court of competent jurisdiction. 6 Section 22. Section 721.52, Florida Statutes, is 7 amended to read: 8 721.52 Definitions.--As used in this chapter, the 9 term: 10 (1) "Applicable law" means the law of the jurisdiction 11 where the accommodations and facilities referred to are 12 located. 13 (2) "Component site" means a specific geographic site 14 where a portion of the accommodations and facilities of the 15 multisite timeshare plan are located. If permitted under 16 applicable law, separate phases operated as a single 17 development located at a specific geographic site under common 18 management shall be deemed a single component site for 19 purposes of this part. 20 (3) "Inventory" means the accommodations and 21 facilities located at a particular component site or sites 22 owned, leased, licensed, or otherwise acquired for use by a 23 developer and offered as part of the multisite timeshare plan. 24 (4) "Multisite timeshare plan" means any method, 25 arrangement, or procedure with respect to which a purchaser 26 obtains, by any means, a recurring right to use and occupy 27 accommodations or facilities of more than one component site, 28 only through use of a reservation system, whether or not the 29 purchaser is able to elect to cease participating in the plan. 30 However, the term "multisite timeshare plan" shall not include 31 any method, arrangement, or procedure wherein: 101 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (a) The contractually specified maximum total 2 financial obligation on the purchaser's part is $3,000 or 3 less, during the entire term of the plan; or 4 (b) The term is for a period of 3 years or less, 5 regardless of the purchaser's contractually specified maximum 6 total financial obligation, if any. For purposes of 7 determining the term of such use and occupancy rights, the 8 period of any optional renewals which a purchaser, in his or 9 her sole discretion, may elect to exercise, whether or not for 10 additional consideration, shall not be included. For purposes 11 of determining the term of such use and occupancy rights, the 12 period of any automatic renewals shall be included unless a 13 purchaser has the right to terminate the membership at any 14 time and receive a pro rata refund or the purchaser receives a 15 notice no less than 30 days and no more than 60 days prior to 16 the date of renewal informing the purchaser of the right to 17 terminate at any time prior to the date of automatic renewal. 18 19 Multisite timeshare plan does not mean an exchange program as 20 defined in s. 721.05. Timeshare estates may only be offered in 21 a multisite timeshare plan pursuant to s. 721.57. 22 (5) "Nonspecific multisite timeshare plan" means a 23 multisite timeshare plan containing timeshare licenses or 24 personal property timeshare interests, with respect to which a 25 purchaser receives a right to use all of the accommodations 26 and facilities, if any, of the multisite timeshare plan 27 through the reservation system, but no specific right to use 28 any particular accommodations and facilities for the remaining 29 term of the multisite timeshare plan in the event that the 30 reservation system is terminated for any reason prior to the 31 expiration of the term of the multisite timeshare plan. 102 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (6) (5)"Reservation system" means the method, 2 arrangement, or procedure by which a purchaser, in order to 3 reserve the use and occupancy of any accommodation or facility 4 of the multisite timeshare plan for one or more use periods, 5 is required to compete with other purchasers in the same 6 multisite timeshare plan regardless of whether such 7 reservation system is operated and maintained by the multisite 8 timeshare plan managing entity, an exchange company, or any 9 other person. In the event that a purchaser is required to use 10 an exchange program as the purchaser's principal means of 11 obtaining the right to use and occupy a multisite timeshare 12 plan's accommodations and facilities, such arrangement shall 13 be deemed a reservation system. When an exchange company 14 utilizes a mechanism for the exchange of use of timeshare 15 periods among members of an exchange program, such utilization 16 is not a reservation system of a multisite timeshare plan. 17 (7) "Specific multisite timeshare plan" means a 18 multisite timeshare plan containing timeshare licenses or 19 personal property timeshare interests, with respect to which a 20 purchaser receives a specific right to use accommodations and 21 facilities, if any, at one component site of a multisite 22 timeshare plan, together with use rights in the other 23 accommodations and facilities of the multisite timeshare plan 24 created by or acquired through the reservation system. 25 (8)(6)"Vacation club" means a multisite timeshare 26 plan. 27 Section 23. Paragraph (a) of subsection (1) of section 28 721.53, Florida Statutes, is amended and paragraph (f) is 29 added to subsection (1) of that section, to read: 30 721.53 Subordination instruments; alternate security 31 arrangements.-- 103 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (1) With respect to each accommodation or facility of 2 a multisite timeshare plan, the developer shall provide the 3 division with satisfactory evidence that one of the following 4 has occurred with respect to each interestholder prior to 5 offering the accommodation or facility as a part of the 6 multisite timeshare plan: 7 (a) The interestholder has executed and recorded a 8 nondisturbance and notice to creditors instrument pursuant to 9 s. 721.08 (2)(c). 10 (f) With respect to any personal property 11 accommodations or facilities, the developer and any other 12 interestholder have complied fully with the applicable 13 provisions of s. 721.08. 14 Section 24. Section 721.54, Florida Statutes, is 15 amended to read: 16 721.54 Term of nonspecific multisite timeshare 17 plans.--It shall be a violation of this part to represent to a 18 purchaser of a nonspecific multisite timeshare planas defined19in s. 721.552(4)that the term of the plan for that purchaser 20 is longer than the shortest term of availability of any of the 21 accommodations included within the plan at the time of 22 purchase. 23 Section 25. Section 721.55, Florida Statutes, is 24 amended to read: 25 721.55 Multisite timeshare plan public offering 26 statement.--Each filedregisteredpublic offering statement 27 for a multisite timeshare plan shall contain the information 28 required by this section and shall comply with the provisions 29 of s. 721.07, except as otherwise provided therein. The 30 division is authorized to provide by rule the method by which 31 a developer must provide such information to the division. 104 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 Each multisite timeshare plan filed registeredpublic offering 2 statement shall contain the following information and 3 disclosures: 4 (1) A cover page containing: 5 (a) The name of the multisite timeshare plan. 6 (b) The following statement in conspicuous type: 7 8 This public offering statement contains important 9 matters to be considered in acquiring an interest in a 10 multisite timeshare plan (or multisite vacation ownership plan 11 or multisite vacation plan or vacation club). The statements 12 contained herein are only summary in nature. A prospective 13 purchaser should refer to all references, accompanying 14 exhibits, contract documents, and sales materials. The 15 prospective purchaser should not rely upon oral 16 representations as being correct and should refer to this 17 document and accompanying exhibits for correct 18 representations. 19 20 (2) A summary containing all statements required to be 21 in conspicuous type in the public offering statement and in 22 all exhibits thereto. 23 (3) A separate index for the contents and exhibits of 24 the public offering statement. 25 (4) A text, which shall include, where applicable, the 26 information and disclosures set forth in paragraphs (a)-(l). 27 (a) A description of the multisite timeshare plan, 28 including its term, legal structure, and form of ownership. 29 For multisite timeshare plans in which the purchaser will 30 receive a timeshare estate pursuant to s. 721.57 and foror a31 specific multisite timeshare planslicense as defined in s.105 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 721.552(4), the description must also include the term of each 2 component site within the multisite timeshare plan. 3 (b) A description of the structure and ownership of 4 the reservation system together with a disclosure of the 5 entity responsible for the operation of the reservation 6 system. The description shall include the financial terms of 7 any lease of the reservation system, if applicable. The 8 developer shall not be required to disclose the financial 9 terms of any such lease if such lease is prepaid in full for 10 the term of the multisite timeshare plan or to any extent that 11 neither purchasers nor the managing entity will be required to 12 make payments for the continued use of the system following 13 default by the developer or termination of the managing 14 entity. 15 (c)1. A description of the manner in which the 16 reservation system operates. The description shall include a 17 disclosure in compliance with the demand balancing standard 18 set forth in s. 721.56(6) and shall describe the developer's 19 efforts to comply with same in creating the reservation 20 system. The description shall also include a summary of the 21 rules and regulations governing access to and use of the 22 reservation system. 23 2. In lieu of describing the rules and regulations of 24 the reservation system in the public offering statement text, 25 the developer may attach the rules and regulations as a 26 separate public offering statement exhibit, together with a 27 cross-reference in the public offering statement text to such 28 exhibit. 29 (d) The existence of and an explanation regarding any 30 priority reservation features that affect a purchaser' s 31 ability to make reservations for the use of a given 106 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 accommodation or facility on a first come, first served basis, 2 including, if applicable, the following statement in 3 conspicuous type: 4 5 Component sites contained in the multisite timeshare 6 plan (or multisite vacation ownership plan or multisite 7 vacation plan or vacation club) are subject to priority 8 reservation features which may affect your ability to obtain a 9 reservation. 10 11 (e) A summary of the material rules and regulations, 12 if any, other than the reservation system rules and 13 regulations, affecting the purchaser's use of each 14 accommodation and facility at each component site. 15 (f) If the provisions of s. 721.552 and the timeshare 16 instrument permit additions, substitutions, or deletions of 17 accommodations or facilities, the public offering statement 18 must include substantially the following information: 19 1. Additions.-- 20 a. A description of the basis upon which new 21 accommodations and facilities may be added to the multisite 22 timeshare plan; by whom additions may be made; and the 23 anticipated effect of the addition of new accommodations and 24 facilities upon the reservation system, its priorities, its 25 rules and regulations, and the availability of existing 26 accommodations and facilities. 27 b. The developer must disclose the existence of any 28 cap on annual increases in common expenses of the multisite 29 timeshare plan that would apply in the event that additional 30 accommodations and facilities are made a part of the plan. 31 107 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 c. The developer shall also disclose any extent to 2 which the purchasers of the multisite timeshare plan will have 3 the right to consent to any proposed additions; if the 4 purchasers do not have the right to consent, the developer 5 must include the following disclosure in conspicuous type: 6 7 Accommodations and facilities may be added to this 8 multisite timeshare plan (or multisite vacation ownership plan 9 or multisite vacation plan or vacation club) without the 10 consent of the purchasers. The addition of accommodations and 11 facilities to the plan may result in the addition of new 12 purchasers who will compete with existing purchasers in making 13 reservations for the use of available accommodations and 14 facilities within the plan, and may also result in an increase 15 in the annual assessment against purchasers for common 16 expenses. 17 18 2. Substitutions.-- 19 a. A description of the basis upon which new 20 accommodations and facilities may be substituted for existing 21 accommodations and facilities of the multisite timeshare plan; 22 by whom substitutions may be made; the basis upon which the 23 determination may be made to cause such substitutions to 24 occur; and any limitations upon the ability to cause 25 substitutions to occur. 26 b. The developer shall also disclose any extent to 27 which purchasers will have the right to consent to any 28 proposed substitutions; if the purchasers do not have the 29 right to consent, the developer must include the following 30 disclosure in conspicuous type: 31 108 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 New accommodations and facilities may be substituted 2 for existing accommodations and facilities of this multisite 3 timeshare plan (or multisite vacation ownership plan or 4 multisite vacation plan or vacation club) without the consent 5 of the purchasers. The replacement accommodations and 6 facilities may be located at a different place or may be of a 7 different type or quality than the replaced accommodations and 8 facilities. The substitution of accommodations and facilities 9 may also result in an increase in the annual assessment 10 against purchasers for common expenses. 11 12 3. Deletions.--A description of any provision of the 13 timeshare instrument governing deletion of accommodations or 14 facilities from the multisite timeshare plan. If the timeshare 15 instrument does not provide for business interruption 16 insurance in the event of a casualty, or if it is unavailable, 17 or if the instrument permits the developer, the managing 18 entity, or the purchasers to elect not to reconstruct after 19 casualty under certain circumstances or to secure replacement 20 accommodations or facilities in lieu of reconstruction, the 21 public offering statement must contain a disclosure that 22 during the reconstruction, replacement, or acquisition period, 23 or as a result of a decision not to reconstruct, purchasers of 24 the plan may temporarily compete for available accommodations 25 on a greater than one-to-one purchaser to accommodation ratio. 26 (g) A description of the developer and the managing 27 entity of the multisite timeshare plan, including: 28 1. The identity of the developer; the developer's 29 business address; the number of years of experience the 30 developer has in the timeshare, hotel, motel, travel, resort, 31 or leisure industries; and a description of any pending 109 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 lawsuit or judgment against the developer which is material to 2 the plan. If there are no such pending lawsuits or judgments, 3 there shall be a statement to that effect. 4 2. The identity of the managing entity of the 5 multisite timeshare plan; the managing entity's business 6 address; the number of years of experience the managing entity 7 has in the timeshare, hotel, motel, travel, resort, or leisure 8 industries; and a description of any lawsuit or judgment 9 against the managing entity which is material to the plan. If 10 there are no pending lawsuits or judgments, there shall be a 11 statement to that effect. The description of the managing 12 entity shall also include a description of the relationship 13 among the managing entity of the multisite timeshare plan and 14 the various component site managing entities. 15 (h) A description of the purchaser's liability for 16 common expenses of the multisite timeshare plan, including the 17 following: 18 1. A description of the common expenses of the plan, 19 including the method of allocation and assessment of such 20 common expenses, whether component site common expenses and 21 real estate taxes are included within the total common expense 22 assessment of the multisite timeshare plan, and, if not, the 23 manner in which timely payment of component site common 24 expenses and real estate taxes shall be accomplished. 25 2. A description of any cap imposed upon the level of 26 common expenses payable by the purchaser. In no event shall 27 the total common expense assessment for the multisite 28 timeshare plan in a given calendar year exceed 125 percent of 29 the total common expense assessment for the plan in the 30 previous calendar year. 31 110 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 3. A description of the entity responsible for the 2 determination of the common expenses of the multisite 3 timeshare plan, as well as any entity which may increase the 4 level of common expenses assessed against the purchaser at the 5 multisite timeshare plan level. 6 4. A description of the method used to collect common 7 expenses, including the entity responsible for such 8 collections, and the lien rights of any entity for nonpayment 9 of common expenses. If the common expenses of any component 10 site are collected by the managing entity of the multisite 11 timeshare plan, a statement to that effect together with the 12 identity and address of the escrow agent required by s. 13 721.56(3). 14 5. If the purchaser will receive an interest in a 15 nonspecific multisite timeshare plan license as defined in s.16721.552(4), a statement that a multisite timeshare plan budget 17 is attached to the public offering statement as an exhibit 18 pursuant to paragraph (7)(c). The multisite timeshare plan 19 budget shall comply with the provisions of s. 721.07(5)(u). 20 6. If the developer intends to guarantee the level of 21 assessments for the multisite timeshare plan, such guarantee 22 must be based upon a good faith estimate of the revenues and 23 expenses of the multisite timeshare plan. The guarantee must 24 include a description of the following: 25 a. The specific time period, measured in one or more 26 calendar or fiscal years, during which the guarantee will be 27 in effect. 28 b. A statement that the developer will pay all common 29 expenses incurred in excess of the total revenues of the 30 multisite timeshare plan, if the developer is to be excused 31 from the payment of assessments during the guarantee period. 111 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 c. The level, expressed in total dollars, at which the 2 developer guarantees the assessments. If the developer has 3 reserved the right to extend or increase the guarantee level, 4 a disclosure must be included to that effect. 5 7. If required under applicable law, the developer 6 shall also disclose the following matters for each component 7 site: 8 a. Any limitation upon annual increases in common 9 expenses; 10 b. The existence of any bad debt or working capital 11 reserve; and 12 c. The existence of any replacement or deferred 13 maintenance reserve. 14 (i) If there are any restrictions upon the sale, 15 transfer, conveyance, or leasing of an interest in a multisite 16 timeshare plan, a description of the restrictions together 17 with a statement in conspicuous type in substantially the 18 following form: 19 20 The sale, lease, or transfer of interests in this 21 multisite timeshare plan is restricted or controlled. 22 23 (j) The following statement in conspicuous type in 24 substantially the following form: 25 26 The purchase of an interest in a multisite timeshare 27 plan (or multisite vacation ownership plan or multisite 28 vacation plan or vacation club) should be based upon its value 29 as a vacation experience or for spending leisure time, and not 30 considered for purposes of acquiring an appreciating 31 112 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 investment or with an expectation that the interest may be 2 resold. 3 4 (k) If the multisite timeshare plan provides 5 purchasers with the opportunity to participate in an exchange 6 program, a description of the name and address of the exchange 7 company and the method by which a purchaser accesses the 8 exchange program. In lieu of this requirement, the public 9 offering statement text may contain a cross-reference to other 10 provisions in the public offering statement or in an exhibit 11 containing this information. 12 (l) A description of each component site, which 13 description may be disclosed in a written, graphic, tabular, 14 or other form approved by the division. The description of 15 each component site shall include the following information: 16 1. The name and address of each component site. 17 2. The number of accommodations, timeshare interests, 18 and timeshare periods, expressed in periods of 7-day use 19 availability, committed to the multisite timeshare plan and 20 available for use by purchasers. 21 3. Each type of accommodation in terms of the number 22 of bedrooms, bathrooms, sleeping capacity, and whether or not 23 the accommodation contains a full kitchen. For purposes of 24 this description, a full kitchen shall mean a kitchen having a 25 minimum of a dishwasher, range, sink, oven, and refrigerator. 26 4. A description of facilities available for use by 27 the purchaser at each component site, including the following: 28 a. The intended use of the facility, if not apparent 29 from the description. 30 b. Any user fees associated with a purchaser's use of 31 the facility. 113 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 5. A cross-reference to the location in the public 2 offering statement of the description of any priority 3 reservation features which may affect a purchaser's ability to 4 obtain a reservation in the component site. 5 (5) Such other information as the division determines 6 is necessary to fairly, meaningfully, and effectively disclose 7 all aspects of the multisite timeshare plan, including, but 8 not limited to, any disclosures made necessary by the 9 operation of s. 721.03(8). However, if a developer has, in 10 good faith, attempted to comply with the requirements of this 11 section, and if, in fact, the developer has substantially 12 complied with the disclosure requirements of this chapter, 13 nonmaterial errors or omissions shall not be actionable. 14 (6) Any other information that the developer, with the 15 approval of the division, desires to include in the public 16 offering statement text. 17 (7) The following documents shall be included as 18 exhibits to the filed registeredpublic offering statement, if 19 applicable: 20 (a) The timeshare instrument. 21 (b) The reservation system rules and regulations. 22 (c) The multisite timeshare plan budget pursuant to 23 subparagraph (4)(h)5. 24 (d) Any document containing the material rules and 25 regulations described in paragraph (4)(e). 26 (e) Any contract, agreement, or other document through 27 which component sites are affiliated with the multisite 28 timeshare plan. 29 (f) Any escrow agreement required pursuant to s. 30 721.08 or s. 721.56(3). 31 114 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (g) The form agreement for sale or lease of an 2 interest in the multisite timeshare plan. 3 (h) The form receipt for multisite timeshare plan 4 documents required to be given to the purchaser pursuant to s. 5 721.551(2)(b). 6 (i) The description of documents list required to be 7 given to the purchaser by s. 721.551(2)(b). 8 (j) The component site managing entity affidavit or 9 statement required by s. 721.56(1). 10 (k) Any subordination instrument required by s. 11 721.53. 12 (l)1. If the multisite timeshare plan contains any 13 component sites located in this state, the information 14 required by s. 721.07(5) pertaining to each such component 15 site unless exempt pursuant to s. 721.03. 16 2. If the purchaser will receive a timeshare estate 17 pursuant to s. 721.57, or an interest in a specific multisite 18 timeshare plan, license as defined in s. 721.552(4)in a 19 component site located outside of this state but which is 20 offered in this state, the information required by s. 21 721.07(5) pertaining to that component site,;provided, 22 however, that the provisions of s. 721.07(5)(u) shall only 23 require disclosure of information related to the estimated 24 budget for the timeshare plan and purchaser's expenses as 25 required by the jurisdiction in which the component site is 26 located. 27 (8)(a) A timeshare plan containing only one component 28 site must be filed with the division as a multisite timeshare 29 plan if the timeshare instrument reserves the right for the 30 developer to add future component sites. However, if the 31 developer fails to add at least one additional component site 115 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 to a timeshare plan described in this paragraph within 3 years 2 after the date the plan is initially filed with the division, 3 the multisite filing for such plan shall thereupon terminate, 4 and the developer may not thereafter offer any further 5 interests in such plan unless and until he or she refiles such 6 plan with the division pursuant to this chapter. 7 (b) The public offering statement for any timeshare 8 plan described in paragraph (a) must include the following 9 disclosure in conspicuous type: 10 11 This timeshare plan has been filed as a multisite 12 timeshare plan (or multisite vacation ownership plan or 13 multisite vacation plan or vacation club); however, this plan 14 currently contains only one component site. The developer is 15 not required to add any additional component sites to the 16 plan. Do not purchase an interest in this plan in reliance 17 upon the addition of any other component sites. 18 Section 26. Paragraphs (b), (c), and (f) of subsection 19 (2) of section 721.551, Florida Statutes, are amended to read: 20 721.551 Delivery of multisite timeshare plan purchaser 21 public offering statement.-- 22 (2) The developer shall furnish each purchaser with 23 the following: 24 (b) A receipt for multisite timeshare plan documents 25 and a list describing any exhibit to the filed registered26 public offering statement which is not delivered to the 27 purchaser. The division is authorized to prescribe by rule the 28 form of the receipt for multisite timeshare plan documents and 29 the description of exhibits list that must be furnished to the 30 purchaser pursuant to this section. 31 116 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (c) If the purchaser will receive a timeshare estate 2 pursuant to s. 721.57, or an interest in a specific multisite 3 timeshare plan, license as defined in s. 721.552(4)in a 4 component site located in this state, the developer shall also 5 furnish the purchaser with the information required to be 6 delivered pursuant to s. 721.07(6)(a) and (b) for the 7 component site in which the purchaser will receive an estate 8 or interest in a specific multisite timeshare planlicense. 9 (f) The developer shall be required to provide the 10 managing entity of the multisite timeshare plan with a copy of 11 the approved filedregisteredpublic offering statement and 12 any approved amendments thereto to be maintained by the 13 managing entity as part of the books and records of the 14 timeshare plan pursuant to s. 721.13(3)(d). 15 Section 27. Paragraph (a) of subsection (2), paragraph 16 (c) of subsection (3), and subsections (4) and (5) of section 17 721.552, Florida Statutes, are amended to read: 18 721.552 Additions, substitutions, or deletions of 19 component site accommodations or facilities; purchaser 20 remedies for violations.--Additions, substitutions, or 21 deletions of component site accommodations or facilities may 22 be made only in accordance with the following: 23 (2) SUBSTITUTIONS.-- 24 (a) Substitutions are available only for nonspecific 25 multisite timesharelicenseplansas defined in subsection26(4). Specific multisite timesharelicenseplans oras defined27in subsection (4) andplans offering timeshare estates 28 pursuant to s. 721.57 may not contain an accommodation 29 substitution right. 30 (3) DELETIONS.-- 31 117 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (c) Automatic deletion.--The timeshare instrument may 2 provide that a component site will be automatically deleted 3 upon the expiration of its term in a timeshare plan other than 4 a nonspecific multisite timeshare licenseplan or as otherwise 5 provided in the timeshare instrument. However, the timeshare 6 instrument must also provide that in the event a component 7 site is deleted from the plan in this manner, a sufficient 8 number of purchasers of the plan will also be deleted so as to 9 maintain no greater than a one-to-one purchaser to 10 accommodation ratio. 11(4) SPECIFIC AND NONSPECIFIC TIMESHARE LICENSES.--For12purposes of this chapter, a specific timeshare license means13one with respect to which a purchaser receives a specific14right to use accommodations and facilities, if any, at one15component site of a multisite timeshare plan, together with16use rights in the other accommodations and facilities of the17multisite timeshare plan created by or acquired through the18reservation system. For purposes of this chapter, a19nonspecific timeshare license means one with respect to which20a purchaser receives a right to use all of the accommodations21and facilities, if any, of a multisite timeshare plan through22the reservation system, but no specific right to use any23particular accommodations and facilities for the remaining24term of the multisite timeshare plan in the event that the25reservation system is terminated for any reason prior to the26expiration of the term of the multisite timeshare plan.27 (4)(5)VIOLATIONS; PURCHASER REMEDIES.--All purchaser 28 remedies pursuant to s. 721.21 shall be available for any 29 violation of the provisions of this section. 30 Section 28. Subsections (4) and (5) of section 721.56, 31 Florida Statutes, are amended to read: 118 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 721.56 Management of multisite timeshare plans; 2 reservation systems; demand balancing.-- 3 (4) The managing entity of a multisite timeshare plan 4 shall comply fully with the requirements of s. 721.13, subject 5 to the provisions of s. 721.13(11) for personal property 6 timeshare plans; however, with respect to a given component 7 site, the managing entity of the multisite timeshare plan 8 shall not be responsible for compliance as the managing entity 9 of that component site unless the managing entity of the 10 multisite timeshare plan is also the managing entity of that 11 component site. Unless the timeshare instrument provides 12 otherwise, the operator of the reservation system is the 13 managing entity of a multisite timeshare plan. 14 (5)(a)1. The reservation system is a facility of any 15 nonspecific timeshare licensemultisite timeshare planas16defined in s. 721.552(4). The reservation system is not a 17 facility of any specifictimeshare licensemultisite timeshare 18 planas defined in s. 721.552(4), nor is it a facility of any 19 multisite timeshare plan in which timeshare estates are 20 offered pursuant to s. 721.57. 21 2. The reservation system of any multisite timeshare 22 plan shall include any computer software and hardware employed 23 for the purpose of enabling or facilitating the operation of 24 the reservation system. Nothing contained in this part shall 25 preclude a manager or management firm that is serving as 26 managing entity of a multisite timeshare plan from providing 27 in its contract with the purchasers or owners' association of 28 the multisite timeshare plan or in the timeshare instrument 29 that the manager or management firm owns the reservation 30 system and that the managing entity shall continue to own the 31 119 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 reservation system in the event the purchasers discharge the 2 managing entity pursuant to s. 721.14. 3 (b) In the event of a termination of a managing entity 4 of a nonspecific licensemultisite timeshare planas defined5in s. 721.552(4), which managing entity owns the reservation 6 system, irrespective of whether the termination is voluntary 7 or involuntary and irrespective of the cause of such 8 termination, in addition to any other remedies available to 9 purchasers in this part, the terminated managing entity shall, 10 prior to such termination, establish a trust meeting the 11 criteria set forth in this paragraph. It is the intent of the 12 Legislature that this trust arrangement provide for an 13 adequate period of continued operation of the reservation 14 system of the multisite timeshare plan, during which period 15 the new managing entity shall make provision for the 16 acquisition of a substitute reservation system. 17 1. The trust shall be established with an independent 18 trustee. Both the terminated managing entity and the new 19 managing entity shall attempt to agree on an acceptable 20 trustee. In the event they cannot agree on an acceptable 21 trustee, they shall each designate a nominee, and the two 22 nominees shall select the trustee. 23 2. The terminated managing entity shall take all steps 24 necessary to enable the trustee or the trustee's designee to 25 operate the reservation system in the same manner as provided 26 in the timeshare instrument and the public offering statement. 27 The trustee may, but shall not be required to, contract with 28 the terminated managing entity for the continued operation of 29 the reservation system. In the event the trustee elects to 30 contract with the terminated managing entity, that managing 31 entity shall be required to operate the reservation system and 120 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 shall be entitled to payment for that service. The payment 2 shall in no event exceed the amount previously paid to the 3 terminated managing entity for operation of the reservation 4 system. 5 3. The trust shall remain in effect for a period of no 6 longer than 1 year following the date of termination of the 7 managing entity. 8 4. Nothing contained in this subsection shall abrogate 9 or otherwise interfere with any proprietary rights in the 10 reservation system that have been reserved by the discharged 11 managing entity, in its management contract or otherwise, so 12 long as such proprietary rights are not asserted in a manner 13 that would prevent the continued operation of the reservation 14 system as contemplated in this subsection. 15 (c) In the event of a termination of a managing entity 16 of a timeshare estate or specific licensemultisite timeshare 17 planas defined in s. 721.552(4), which managing entity owns 18 the reservation system, irrespective of whether the 19 termination is voluntary or involuntary and irrespective of 20 the cause of such termination, in addition to any other 21 remedies available to purchasers in this part, the terminated 22 managing entity shall, prior to such termination, promptly 23 transfer to each component site managing entity all relevant 24 data contained in the reservation system with respect to that 25 component site, including, but not limited to: 26 1. The names, addresses, and reservation status of 27 component site accommodations. 28 2. The names and addresses of all purchasers of 29 timeshare interests at that component site. 30 3. All outstanding confirmed reservations and 31 reservation requests for that component site. 121 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 4. Such other component site records and information 2 as are necessary, in the reasonable discretion of the 3 component site managing entity, to permit the uninterrupted 4 operation and administration of the component site, provided 5 that a given component site managing entity shall not be 6 entitled to any information regarding other component sites or 7 regarding the terminated multisite timeshare plan managing 8 entity. 9 10 All reasonable costs incurred by the terminated managing 11 entity in effecting the transfer of information required by 12 this paragraph shall be reimbursed to the terminated managing 13 entity on a pro rata basis by each component site, and the 14 amount of such reimbursement shall constitute a common expense 15 of each component site. 16 Section 29. Subsection (2) of section 721.57, Florida 17 Statutes, is amended to read: 18 721.57 Offering of timeshare estates in multisite 19 timeshare plans; required provisions in the timeshare 20 instrument.-- 21 (2) The timeshare instrument of a multisite timeshare 22 plan in which timeshare estates are offered, other than a 23 trust meeting the requirements of s. 721.08, must contain or 24 provide for all of the following matters: 25 (a) The purchaser will receive a timeshare estate as 26 defined in s. 721.05 in one of the component sites of the 27 multisite timeshare plan. The use rights in the other 28 component sites of the multisite timeshare plan shall be made 29 available to the purchaser through the reservation system 30 pursuant to the timeshare instrument. 31 122 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 (b) In the event that the reservation system is 2 terminated or otherwise becomes unavailable for any reason 3 prior to the expiration of the term of the multisite timeshare 4 plan: 5 1. The purchaser will be able to continue to use the 6 accommodations and facilities of the component site in which 7 she or he has been conveyed a timeshare estate in the manner 8 described in the timeshare instrument for the remaining term 9 of the timeshare estate; and 10 2. Any use rights in that component site which had 11 previously been made available through the reservation system 12 to purchasers of the multisite timeshare plan who were not 13 offered a timeshare estate at that component site will 14 terminate when the reservation system is terminated or 15 otherwise becomes unavailable for any reason. 16 Section 30. Subsection (6) of section 721.84, Florida 17 Statutes, is amended to read: 18 721.84 Appointment of a registered agent; duties.-- 19 (6) Unless otherwise provided in this section, a 20 registered agent in receipt of any notice or other document 21 addressed from the lienholder to the obligor in care of the 22 registered agent at the registered office must mail, by first 23 class mail if the obligor's address is within the United 24 States, and by international air mail if the obligor's address 25 is outside the United States, with postage fees prepaid, such 26 notice or documents to the obligor at the obligor's last 27 designated address within 5 days after ofreceipt. 28 Section 31. Section 721.96, Florida Statutes, is 29 amended to read: 30 721.96 Purpose.--The purpose of this part is to 31 provide for the appointment of commissioners of deeds to take 123 CODING: Wordsstrickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 acknowledgments, proofs of execution, and oaths outside the 2 United States in connection with the execution of any deed, 3 mortgage, deed of trust, contract, power of attorney, or any 4 other agreement, instrument or writing concerning, relating 5 to, or to be used or recorded in connection with a timeshare 6 estate, personal property timeshare interest, timeshare 7 license, any property subject to a timeshare plan, or the 8 operation of a timeshare plan located within this state. 9 Section 32. Subsection (1) of section 721.97, Florida 10 Statutes, is amended to read: 11 721.97 Timeshare commissioner of deeds.-- 12 (1) The Governor may appoint commissioners of deeds to 13 take acknowledgments, proofs of execution, or oaths in any 14 foreign country. The term of office is 4 years. Commissioners 15 of deeds shall have authority to take acknowledgments, proofs 16 of execution, and oaths in connection with the execution of 17 any deed, mortgage, deed of trust, contract, power of 18 attorney, or any other writing to be used or recorded in 19 connection with a timeshare estate, personal property 20 timeshare interest, timeshare license, any property subject to 21 a timeshare plan, or the operation of a timeshare plan located 22 within this state; provided such instrument or writing is 23 executed outside the United States. Such acknowledgments, 24 proofs of execution, and oaths must be taken or made in the 25 manner directed by the laws of this state, including but not 26 limited to s. 117.05(4), (5)(a), and (6), Florida Statutes 27 1997, and certified by a commissioner of deeds. The 28 certification must be endorsed on or annexed to the instrument 29 or writing aforesaid and has the same effect as if made or 30 taken by a notary public licensed in this state. 31 124 CODING: Words strickenare deletions; words underlined are additions.Florida Senate - 2003 CS for CS for SB 2534 316-2462-03 1 Section 33. With respect to any timeshare plan or 2 exchange program filing approved by the Division of Florida 3 Land Sales, Condominiums, and Mobile Homes of the Department 4 of Business and Professional Regulation prior to the date this 5 act becomes a law, the amendments made by this act to section 6 721.06(1)(g)2., section 721.07(2)(d)1. and (5)(c)4., section 7 721.075(2)(e), section 721.18(1)(l) and (m), or section 8 721.27, Florida Statutes, shall not apply to such filing until 9 the earlier of January 1, 2004, or the date that any amendment 10 to such filing is made subsequent to the date this act becomes 11 a law. With respect to any timeshare plan filing approved by 12 the division prior to the date this act becomes a law, the 13 amendments made by this act to section 721.08(3)(a), Florida 14 Statutes, shall not apply to the nondisturbance and 15 notice-to-creditors instrument required by section 721.08, 16 Florida Statutes, unless and only to the extent that the 17 developer otherwise voluntarily complies with all or a portion 18 of such provisions. 19 Section 34. This act shall take effect upon becoming a 20 law. 21 22 STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN COMMITTEE SUBSTITUTE FOR 23 CS/SB 2534 24 25 This CS/CS makes a number of technical changes to the CS, and removes the decrease in fees proposed in the CS. 26 27 28 29 30 31 125 CODING: Words strickenare deletions; words underlined are additions.