Original Message:
Re: Diamond Resorts reduces owner benefits again! (by Keith P.):
ATTORNEYS NAME'S ARE IN THE LAST PARAGRAPH.
Hanalei Bay Resort Board of Directors Reach Settlement with Celebrity Resorts Press Release from Hanalei Bay Resort Board of Directors
Settlement Agreement with Celebrity: We have reached an agreement between Celebrity Resorts and the VOA and the AOAO, which settles the various legal issues between them. As you know, Celebrity purchased Quintus Vacation Management last year which included the VOA and AOAO management contracts along with certain Developer Rights. They also purchased Apartment 16-A - the Happy Talk Lounge and the Bali Hai Restaurant. The Settlement Agreement enables the buyout of the two management contacts from Celebrity and restores the member elected VOA Board installed last year. The AOAO will have a right of first refusal on a future sale of Apartment 16-A, and some rights to lease or subsidize operations of the Happy Talk Lounge in the event Celebrity feels it is not a profitable operatio n and wishes to close it. The re-opening of the Bali Hai Restaurant is an economic decision that will be made by Celebrity as the restaurant owner—it is currently open on a limited basis. The result is a cessation of excessive legal expenses, a reconciliation and redefinition of Association operational control in favor of the owners, the installation and empowering of a member only board of directors, the hiring of a new professional management company and the onset of a bright and exciting future for Hanalei Bay Resort and you, the members.
New Management Company - Trading Places International (TPI) The VOA and the AOAO Boards have executed agreements with TPI, a resort management company based in Laguna Niguel, California. TPI manages three resorts in Hawaii plus another 19 in the US and Mexico. TPI was one of six management companies the Boards contacted when we sought alternative management, and their references are outstanding. The agreement with TPI will initially be for a three year term, renewable, but entirely under the control of the two respective Boards. TPI will begin the transition of management of the resort as soon as all legal documents have been cleared which will occur early in October—Started Today!
Transition Period Planned / Employees Retained / Board Meeting Planned: There will be a transition period during which an independent auditor will review all income, expenses and advances made by Celebrity for both of the Association's financials to generate a final monetary settlement. We are also trying to resolve the lack of accounting records from Quintus when Celebrity acquired the contracts. This has been a problem in completing our 2008 audit. The resort employees will become employees of TPI. We have compared benefits and salaries to insure that employees do not lose in their transition to TPI. It is TPI's plan to retain most of our employees. An AOAO and a VOA Board meeting is planned for October 17, 2009 at the resort to review the transition, prepare the 2010 budget and complete some long term planning.
Celebrity Resort's Continued Presence at HBR: Celebrity continues to own the restaurants and we look forward to working with them in a harmonious relationship. Their success will benefit each of our owners and guests. As part of the Developer Rights (which Celebrity owns), they will have exclusive rights to market timeshare sales at HBR and to rent unused timeshare weeks under an agreement with the VOA. The AOAO will lease a portion of the Aikane Room (now exclusively the timeshare marketing office) and the Food and Beverage Office on the lower level to Celebrity. The Concierge desks in the lobby will be operated by TPI under a lease with the AOAO, with timeshare marketing leads referred to Celebrity.
2009 Regular Dues Payments: TPI will be providing the VOA interval owners with continued service for the payment of annual fees. They will also be providing the AOAO owners with regular monthly statements so the AOAO owners can complete their regular payments on time. In the meantime AOAO owners should pay their monthly dues to the AOAO account in Princeville. If you are a VOA owner and you are delinquent in the payment of your fees, we would ask and highly recommend that you pay curren t. The Board is securing our future and it is bright and your timeshare will have great value for excellent vacation experiences you bargained to own.
Resort Update: Operations at the resort are generally positive except for the spa. The resort has incurred numerous maintenance challenges with the gas fired heater and pumps this summer. Through the leadership and experience of AOAO Board member Dave Blank, who is a resort manager himself in Colorado, the AOAO board has approved rebuilding and replacement of the heater and pumps. There is a great need to build the AOAO and VOA reserves to the legally mandated levels, and to make major improvements in the VOA units and the boards will be taking on these challenges immediately. There will be a need for an owner assessment, the amount of which is currently being determined. You will be receiving more detail on the assessment along with other information in the next week or so.
Successful Negotiating Team: Many thanks to the Board appointed negotiating team for the Settlement discussions. They have put in numerous hours and great personal effort. Thanks to Bill Kraft and Kent Oehm representing the AOAO; and Dick Schweickert and David Nicholl representing the VOA; and BILL BYRNS and RALPH O'NEIL OUR LEGAL COUNSEL We extend to you our deepest appreciation for your support and patience during this difficult process. We understand that you have been worried and upset over the recent circumstances surrounding your ownership. We thank you for your participation and recommendations and we know that you will be pleased that we have been able to work so well with Celebrity Resorts and arrive at a reasonable reconciliation and secure control of our beautiful resort and our future.
Sincerely, The VOA and AOAO Board of Directors: