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By-Laws – Article II
Membership
Section 1. Classes and Eligibility. Eligibility for membership is not to be restricted to North America and the Caribbean or any other geographical region. The classes of members (“Members”) of the Association and the eligibility requirements for membership in each class shall be as follows:
(a) Regular Membership. Any hotel that is operated under one of the Starwood Brands and is either (i) owned by a Franchisee that has entered into a Franchise or License Agreement with Starwood or its affiliates or (ii) owned by an Owner that has entered into a License Agreement or Management Contract with Starwood or its affiliates shall be eligible to be a “Regular Member” of the Association, provided that the Owner or Franchisee (i) is not controlled by, controlling, or under common control with Starwood or its affiliates and (ii) remains in good standing in its agreements with Starwood or its affiliates. A Regular Member may be represented in the Association by its Franchisee or Owner, general manager, a principal officer of its management company, or an individual that is a partner or principal officer of its Franchisee or Owner. However, a Regular Member’s designated representative may not be directly or indirectly employed by or under the control of Starwood or its affiliates. Thus, it is the intent of these By-laws that a hotel that is not owned by Starwood, but is managed by Starwood, shall nevertheless be eligible for Regular Membership; however, the person designated to represent the Owner may not be directly or indirectly employed by or under the control of Starwood or its affiliates.
(b) Associate Membership. Any person (which term as used in these By-laws shall include an individual, partnership, corporation, management company, joint venture, or other entity) who is not a Franchisee or Owner and who is invited to join the Association by the Board shall be eligible to become an “Associate Member” of the Association. Without limiting the foregoing, Associate Membership may be granted to suppliers or potential suppliers to any of the Starwood franchise systems. The terms and conditions of Associate Membership shall be established by the Board in its sole discretion. Associate Membership need not be granted to various candidates upon the same terms and conditions. Associate Membership may be terminated, with or without cause, at any time by the Board. The Board may select one representative of each Associate Member to serve as an “Honorary Director”, provided that the Honorary Director is not directly or indirectly employed by or under the control of Starwood or its affiliates.
Section 2. Regular Membership Applications. Regular Membership shall commence upon (i) the filing with the Secretary of the Association of an application for membership and (ii) payment of any required contribution to the capital of the Association. The application shall be in such form as may be prescribed by the Association and shall specify that the applicant agrees to abide by the rules and By-laws of the Association and to fulfill the obligations and responsibilities of membership as set out in the Association’s Articles of Incorporation and in these By-laws. The amount of a new Member’s contribution to the capital of the Association shall be determined from time to time by the Board. The Board may, in its sole discretion, decline to accept a membership application/payment if the Owner or Franchisee that is submitting their hotel for membership is, at that time, not in good standing with Starwood for any reason whatsoever.
Section 3. Dues. The annual dues payable by Members (which may be different for Regular Members and Associate Members) shall be an amount determined from time to time by the Board, may be prospectively adjusted at any time by the Board with respect to any future dues payments, and shall entitle the Member to twelve months of membership, starting on the first day of the next calendar month after dues have been received by the Association and the applicant’s membership application has been accepted by the Association (the “Initial Membership Date”). Dues for subsequent twelve-month periods shall be due and payable commencing on the first anniversary of the Initial Membership Date and on the anniversary of each Initial Membership Date thereafter. Failure by any Member to pay annual dues within sixty (60) days after their due date shall result in automatic termination of such Member.
Section 4. Participation of Regular Members During Defaults. If, after being accepted as a Regular Member, the Owner or Franchisee that owns the Regular Member defaults under the License Agreement, Franchise Agreement, or Management Agreement relating to the Regular Member, the Regular Member and any associated Directors may continue to participate in and exercise all rights in the Association, provided that the default is cured to the satisfaction of Starwood and its affiliates during the applicable cure period.
Section 5. Termination of Regular Members. If the License Agreement, Franchise Agreement, or Management Contract relating to a hotel that is a Regular Member expires or is terminated and the Regular Member ceases to operate under the Starwood Brands, the Regular Member’s membership in the Association will automatically terminate. In addition, the Regular Members, by a two-thirds vote of the Regular Members present and voting at any meeting at which a quorum is present, may terminate the membership of any Regular Member whose continued membership is deemed by them to be contrary to the best interest of the Association. Notice of such termination shall be given in writing addressed to the Regular Member and shall take effect at the time specified in the notice.
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