                                 CODE OF VIRGINIA

ESCROW AND BONDING (§ 59.1-329)

A. All purchase money received from or on behalf of a purchaser in connection
with the execution of a membership camping contract shall be deposited in an
escrow or trust account designated solely for that purpose, which may be the
membership camping operator&#8217;s own escrow or trust account or that of his
attorney&#8217;s, until the expiration of the time for cancellation has expired
unless a later time is provided in the membership camping contract. If the
contract has not been canceled, any purchase money received from a purchaser may
be released to the membership camping operator upon:

   1. The conveying to the purchaser of the title to, interest in, or right or
   license to use the campground and facilities as required in the membership
   camping contract; or

   2. The forfeiture of the purchase money by the purchaser under the terms of
   the membership camping contract.

B. In lieu of the obligations imposed by subsection A, the membership camping
operator may file and maintain with the Commissioner a surety bond issued in
favor of the Commissioner for the benefit of purchasers insuring the escrow of
the purchase money until such time as it may be released as outlined in
subsection A. Such bond may not be canceled until thirty days after written
notice of cancellation is received by the Commissioner. In lieu of such bond,
the membership camping operator may post with the Commissioner an irrevocable
letter of credit in a form and content acceptable to the Commissioner. The
penalty of the bond or letter of credit shall be adjusted from time to time in
accordance with the following schedule:

C. The amount of purchase money paid by purchasers held at any one time by the
membership camping operator shall not exceed the amount for which the operator
is bonded or the letter of credit is issued in accordance with the schedule set
forth in subsection B.

D. In addition to any bonding requirements contained in this section, the
membership camping operator shall file and maintain with the Commissioner a
payment and performance bond with surety issued in favor of the Commissioner for
the benefit of the purchasers and which guarantees the completion of all
incomplete or planned facilities constructed or to be constructed in this
Commonwealth as outlined or listed in either the membership camping contract or
the membership camping operator&#8217;s disclosure statement. The bond may not
be canceled until thirty days after written notice of cancellation is received
by the Commissioner. In lieu of the bond the membership camping operator may
post with the Commissioner an irrevocable letter of credit. The surety bond or
letter of credit shall be in a form and content acceptable to the Commissioner.
The penalty of the bond or letter of credit shall be in an amount equal to the
cost of completing the incomplete or planned facilities as of the date of its
issuance or as of the membership camping operator&#8217;s application for
continued registration date as provided in &#xA7; 59.1-320.1, whichever is
later.

HISTORY: 1985, c. 409; 1992, c. 545.