Joint Motion For Approval of Term Sheet and Authorization To Implement Certain Matters Set Forth Therein

4838-9404-7505.
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UNITED STATES BANKRUPTCY COURT
DISTRICT OF COLORADO

In re

CORDILLERA GOLF CLUB, LLC dba The
Club at Cordillera,
Tax ID / EIN: 27-0331317

Debtor.

Case No. 12-24882 ABC
Chapter 11
JOINT MOTION FOR APPROVAL OF TERM SHEET AND
AUTHORIZATION TO IMPLEMENT CERTAIN MATTERS SET FORTH
THEREIN

The Debtor and Debtor-in-Possession, Cordillera Golf Club, LLC, dba The Club at
Cordillera (the Debtor), and the Official Committee of Unsecured Creditors appointed in the
Bankruptcy Case (as defined herein) (Committee), by and through their undersigned counsel,
hereby respectfully submit this Joint Motion for Approval of Term Sheet and Authorization to
Implement Certain Matters Set Forth Therein ("Joint Motion"). The Debtor, the Committee,
Cordillera Golf Holdings, LLC, a Delaware limited liability company (CGH), Cordillera F &
B, LLC, a Delaware limited liability company, including any successor thereto (CFB), WFP
Cordillera, LLC, a Delaware limited liability company (WFP), WFP Investments, LLC, a
Delaware limited liability company (WFPI), CGH Manager, LLC, a Delaware limited liability
company (CGHM), David A. Wilhelm (Wilhelm), Patrick Wilhelm (P. Wilhelm),
Cordillera Transition Corporation, Inc., a Colorado not for profit corporation (CTC),
Cordillera Property Owners Association, Inc., a Colorado not for profit corporation (CPOA),
Cordillera Metropolitan District, a quasi-municipal corporation and political subdivision of the
State of Colorado (CMD), Cordillera Valley Club Property Owners Association, Inc., a
Colorado not for profit corporation (CVCPOA), Cheryl M. Foley, Thomas Wilner, Jane
Case:12-24882-ABC Doc#:519 Filed:10/05/12 Entered:10/05/12 13:38:53 Page1 of 29
4838-9404-7505.4

Wilner, Charles Jackson, Mary Jackson, Kevin B. Allen, as representatives of a certified class in
Case Number 11CV552, pending in the District Court of Eagle County, Colorado (collectively,
the Member Representatives) and Alpine Bank (Alpine) (collectively, all such parties, the
Approving Parties), have all executed a Term Sheet dated September 17, 2012, a copy of
which is attached hereto as Exhibit 1 and incorporated herein by reference (the Term Sheet),
providing for the settlement of various matters as provided therein and as more fully set forth
below. The Debtor, the Committee and the other Approving Parties respectfully request and
recommend the approval of the matters as set forth below.
///
///
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TABLE OF CONTENTS
Page
I. BACKGROUND................................................................................................................ 1

A. The Cordillera Club ................................................................................................ 1

B. The Membership Plan............................................................................................. 2

C. The Debtors Acquisition of the Cordillera Club ................................................... 2

D. Secured Debt Obligations ....................................................................................... 3

E. Tension With the Club Members............................................................................ 5

F. The Pending State Court Litigation ........................................................................ 5

a. CTC Lawsuit ........................................................................................... 5

b. Class Action Lawsuit............................................................................... 5

G. The Debtors Chapter 11 Filing.............................................................................. 6

a. The DIP Financing Motion...................................................................... 7

b. The Trustee Motion................................................................................. 9

II. JURISDICTION ................................................................................................................. 9
III. SETTLEMENTS............................................................................................................... 10
A. Summary of Term Sheet ....................................................................................... 10

a. The DIP Loan............................................................................................ 10

b. Partial Settlement of Class Action Lawsuit .............................................. 11

c. Settlement of CTC Lawsuit ...................................................................... 12
IV. RELIEF REQUESTED..................................................................................................... 19
V. BASIS FOR RELIEF........................................................................................................ 21

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TABLE OF AUTHORITIES
Page
FEDERAL CASES
Kaiser Steel Corp. v. Frates (In re Kaiser Steel Corp.),
105 B.R. 971 (D.Colo.1989)....................................................................................................21
Stanpec Corp. v. Jelco, Inc.,
464 F.3d 1184 (10th Cir. 1972) ...............................................................................................21
FEDERAL STATUTES
11 U.S.C. 101................................................................................................................................7
11 U.S.C. 105................................................................................................................................7
11 U.S.C. 361................................................................................................................................7
11 U.S.C. 362................................................................................................................................7
11 U.S.C. 363(c) ...........................................................................................................................7
11 U.S.C. 364(c) ...........................................................................................................................7
11 U.S.C. 363(b) ........................................................................................................................16
11 U.S.C. 363(f).........................................................................................................................16
11 U.S.C. 364(d) ...........................................................................................................................7
11 U.S.C. 364(e) ...........................................................................................................................7
11 U.S.C. 365.............................................................................................................................14
11 U.S.C. 506(b) ...................................................................................................................15, 20
11 U.S.C. 1107(a) ........................................................................................................................7
11 U.S.C. 1108.............................................................................................................................7
28 U.S.C. 157................................................................................................................................9
28 U.S.C. 157(b)(2) ......................................................................................................................9
28 U.S.C. 1334..............................................................................................................................9
28 U.S.C. 1408..............................................................................................................................9
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TABLE OF AUTHORITIES
(Continued)
Page
28 U.S.C. 1409..............................................................................................................................9
RULES
Fed. R. Bankr. P. 2002.....................................................................................................................7
Fed. R. Bankr. P. 4001.....................................................................................................................7
Fed. R. Bankr. P. 9014(I).................................................................................................................7
Fed. R. Bankr. P. 9019.........................................................................................................9, 21, 22
C.R.C.P. 26(a)(1) .....................................................................................................................14, 21

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I. BACKGROUND
A. The Cordillera Club
1. The Debtor is the owner and operator of a golf club (the Cordillera Club or
"Club") located in a community in Edwards, Colorado (Cordillera).
2. Initially conceived in the early 1990s, Cordillera today has burgeoned into a
sprawling development spanning approximately 7,000 acres. The Cordillera community is
governed by homeowners associations known as the CPOA and the CVCPOA. Cordillera is
comprised of four distinct residential neighborhoods known as the Divide, the Ranch, the
Summit and the Cordillera Valley Club, which collectively consist of approximately 1087
privately owned residential lots, over half of which are improved with high-end custom and
semi-custom single family homes.
3. The Cordillera Club lifestyle and experience are punctuated by private amenities
and facilities available to dues-paying members (collectively, Club Members) who join the
Cordillera Club. The Club Members are not equity owners in the Cordillera Club, the Debtor or
any of its property.
4. The Cordillera Club boasts of three signature golf courses, a Dave Pelz designed
short course, two tennis centers and fitness facilities, three indoor and outdoor pools, a summer
camp with Trailhead clubhouse for children, three restaurants, and Nordic ski trails along the
Mountain golf course (collectively, the Club Facilities).
5. Each property owner within the Cordillera community is a voting member of the
CPOA and CVCPOA and pays dues and assessments respectively. Ownership of property at
Cordillera with the concomitant membership in CPOA or CVCPOA does not include a right of
access to, or use of, the Club Facilities offered by the Cordillera Club.
6. The Debtor sells non-equity and non-voting memberships to the Cordillera Club
(the Club Memberships) by which its Club Members, if they are members in good standing,
may access and use the Club Facilities.
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7. The primary source of revenue to fund the operations and management of the
extensive Club Facilities is derived from membership initiation fees and annual membership
dues. Other sources of revenue include transfer fees, golf fees, guest fees, pro shop revenue,
food and beverage revenues and operating department revenues.
B. The Membership Plan
8. Membership at the Cordillera Club is governed by the terms and conditions of the
Debtor's Club Membership plan (as amended or revised from time to time, the "Membership
Plan") and the particular membership classification selected by any individual. The primary
difference between the various Club Membership classifications is related to rights, benefits,
privileges, transferability, reissue priorities and financial obligations.
9. The Membership Plan provides for different rights, privileges and obligations
based upon designated categories of Club Memberships.
C. The Debtors Acquisition of the Cordillera Club
10. In June 2009, the Debtor acquired the Club Facilities.
11. Prior to June 2009, the Debtors current indirect equity owner, Wilhelm, owned
an approximate 30% interest in the entities owning the Club Facilities, but held no management
position with such entities. Following a forensic audit completed at Wilhelms request, Wilhelm
asserted that the prior owners and their then-current management none of whom are associated
in any way with the Debtor or its current management or ownership had allegedly diverted
substantial funds away from the Cordillera Clubs operations. This lead to arbitration
proceedings among Wilhelm (in his capacity as 30% owner) and the Cordillera Clubs owners
and then-current management team, which also owned the remaining 70% interest in the
Cordillera Club. As a result of that arbitration, entities formed by Wilhelm acquired a 100%
ownership interest in the Cordillera Club and the Club Facilities and anyone associated with the
Cordillera Clubs former owners and then-current managements mismanagement of the
Cordillera Club was relieved of their positions.
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D. Secured Debt Obligations
12. Or about June 26, 2009, Alpine and the Debtor entered into that certain Business
Loan Agreement (the Loan Agreement), pursuant to which Alpine loaned to the Debtor the
original principal amount of $13,700,000 (the Alpine Loan).
13. The Alpine Loan is evidenced by a Promissory Note dated June 29, 2009 (the
Alpine Note). The Note matured on June 26, 2012. The Alpine Loan purports to be secured
pursuant to a Deed of Trust dated June 26, 2009 and recorded in Eagle County Records Office
on June 29, 2009 as Document No. 200912623 (the Alpine Deed of Trust).
14. As security for the Debtors obligations under the Alpine Note, the Alpine Deed
of Trust purports to encumber the real property described therein, including all or a portion of the
Facilities (the Real Property). The Alpine Deed of Trust also purports to encumber certain
personal property described therein, including all equipment, fixtures, and other articles of
personal property now or hereafter owned by Grantor, and now or hereafter attached or affixed to
the Real Property. . . . The Alpine Note also purports to be secured pursuant to: (i) a Collateral
Assignment of Contracts dated June 26, 2009 purporting to encumber certain water rights, and
related contracts as listed therein; (ii) a Collateral Assignment and Security Agreement Covering
Agreements, Permits and Contracts dated June 26, 2009, purporting to encumber the Collateral
as defined therein, including contracts, licenses, and other agreements as described therein; (iii) a
Collateral Assignment and Security Agreement Covering Golf Membership Revenues dated
June 26, 2009, purporting to encumber Net Sales Revenues and Income from Dues as
defined therein, including revenues from the sale of golf course memberships with respect to the
Courses and dues, assessments, fees or other charges on account of memberships in the Club;
(iv) a Commercial Pledge Agreement dated June 26, 2009 purporting to encumber all
memberships in the Club; and (v) a Commercial Security Agreement dated June 26, 2009
purporting to encumber furniture, fixtures, equipment, inventory, accounts receivable, general
intangibles, contracts and contract rights, permits, goods, instruments, investment property, letter
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of credit rights, chattel paper, commercial tort claims, and all proceeds from the disposition
thereof (all of the personal property purporting to be collateral for the Alpine Note, collectively,
the Personal Property). On June 30, 2009, Alpine filed a UCC Financing Statement with the
Delaware Secretary of State purporting to perfect its security interest in the Personal Property.
The documents executed in connection with the Alpine Loan are collectively referred to as the
Alpine Loan Documents. All collateral purported to secure the Alpine Note is collectively
referred to as the Alpine Collateral.
15. On or about June 23, 2010, Wilhelm made a loan to the Debtor in the original
principal amount of $6,500,000 (the Wilhelm Loan), evidenced by a Promissory Note dated
June 23, 2010 (as at any time amended or modified, the Wilhelm Note). The Wilhelm Note
purports to be secured by a Deed of Trust, Security Agreement, Assignment of Leases and Rents
and Fixture filing dated June 23, 2010, and recorded with the Eagle County Recorders Office on
August 12, 2010 as Document No. 20105834 (as at any time amended or modified, the Wilhelm
Deed of Trust), purportedly encumbering the Real Property and portions of the Personal
Property, as further described therein. The Wilhelm Note has purportedly been amended from
time to time evidencing additional loans made to the Debtor by Wilhelm, including without
limitation an amendment increasing the maximum principal amount of such note to $7,470,000.
The documents executed in connection with the Wilhelm Loan are collectively referred to as the
Wilhelm Loan Documents. All collateral purported to secure the Wilhelm Note is collectively
referred to as the Wilhelm Collateral. The purported Alpine Collateral and the purported
Wilhelm Collateral are collectively referred to as the Collateral, and Collateral which is
personal property is collectively referred to as the Personal Property Collateral.
16. The Debtors schedules reflect the amount of the Alpine Loan and the Wilhelm
Loan as approximately $12,763,617.00 million and $7,532,608.02 million, respectively.
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E. Tension With the Club Members
17. Starting in August 2010, the Debtors and Wilhelms relationship with certain
Club Members became strained and many Members began to resign from the Club.
18. In May 2011, the Club advised the Club Members that as a result of financial
conditions, the Cordillera Club had no alternative but to open only one of the four club facilities
the Valley Club. Later in 2011, the decision was made to also open the Summit Course. The
Mountain Course and the Short Course were not opened in 2011 and neither were two
restaurants (including the main club restaurant), the Trailhead with its swimming pool, and the
Nordic trails.
F. The Pending State Court Litigation
19. The Debtor is a party to the following litigation matters pending in Colorado state
court.
a. CTC Lawsuit
20. On May 24, 2011, the Debtor filed a complaint (the CTC Complaint) in the
District Court for Eagle County, Colorado (the Eagle County Court) against the CPOA and the
CTC styled Cordillera Golf Club, LLC, et al. v. Cordillera Transition Corporation, Inc., et al.
assigned case number 2011 CV 456 (the CTC Lawsuit).
21. The CTC Complaint asserts seven causes of action for (1) Tortious Interference
with Contract; (2) Tortious Interference with Prospective Business Advantage; (3) Colorado
Organized Crime Control Act; (4) Fraud; (5) Fraud in the Inducement; (6) Civil
Conspiracy/Collusion; and (7) Defamation. The CTC defendants contended that they have
meritorious defenses to the CTC Complaint. A three week jury trial is set for April 1-19, 2013.
b. Class Action Lawsuit
22. On June 20, 2011, a lawsuit was filed against the Debtor and WFP, CGH, CFB,
WFPI, CGHM, CFB, Wilhelm, and P. Wilhelm for, among other things, (1) Breach of Contract,
(2) Promissory Estoppel, and (3) False Representation, alleging that management was required to
4838-9404-7505.4
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open all facilities. The lawsuit was later amended to assert claims on behalf of the class and to
add additional claims for securities and consumer fraud violations and other causes of action.
This lawsuit is styled Foley v. Cordillera Golf Club LLC, 2011 CV 552, pending in Eagle
County Court (the Class Action Lawsuit). Plaintiffs in the Class Action Lawsuit seek return of
all 2011 Club Membership dues paid, their Club Membership deposits, avoidance of further
membership obligations, decline in home values, exemplary damages, etc. The Court has
certified this matter as a Class Action and has appointed the Member Representatives as the
Class Representatives. The Debtor and other defendants in the Class Action Lawsuit believe
they have multiple meritorious defenses to the claims in the Class Action Lawsuit. The Debtor
and other defendants in the Class Action Lawsuit have tendered their defense to their insurers.
Trial is scheduled for March 2013.
23. On June 24, 2011, the District Court entered a TRO in the Class Action Lawsuit
which provided, among other things: that defendants shall not use funds from 2011 annual dues
received from Club at Cordillera (Club) members for any purpose other than the necessary
maintenance and operation of the Clubs four golf courses and related facilities. The TRO was
extended multiple times and became a Preliminary Injunction, which has since expired.
24. On December 2, 2011, the Class Representatives filed a Verified Motion for
Issuance of Contempt Citation alleging seven (7) payments made from June 30, 2011 to
August 31, 2011, by CGC were in violation of the TRO (the Contempt Motion).
25. A hearing was scheduled to begin on the Contempt Motion on July 20, 2012,
which hearing was later continued to September 7, 2012. The Eagle County Court has not
scheduled further hearing.
G. The Debtors Chapter 11 Filing
26. Due to economic, industry and other circumstances, which the Debtor alleges
were beyond its control, Club Membership sales slowed. By mid-2012, it was clear that the
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Cordillera Club lacked the critical mass of Club Members necessary to maintain the high level of
services and operations at the Club Facilities.
27. These conditions were exacerbated by the mass resignations of Club Members.
The Debtor had attempted to work out a loan extension with Alpine, but Alpine did not agree to
extend the due date of the Debtors loan.
28. As a result of the foregoing, the Debtor determined that it would be unable to
make the payment due to Alpine by close of business on June 26, 2012.
29. In March 2012, the Debtor retained Daniel L. Fitchett, Jr. as its Chief Executive
Officer (CEO), and Mr. Fitchett has been running the day-to-day operations of the Debtor
since that date. The Debtor engaged Alfred Siegel as Chief Restructuring Officer (CRO) on
June 22, 2012 (which retention was subsequently approved by this Court). The Debtor, in
consultation with its management and professionals (including its CRO), retained the services of
an experienced real estate consultant and investment banker with significant experience in the
golf and hospitality industries, GA Keen Realty Advisors, LLC (Keen), (which retention was
subsequently approved by this Court).
30. On June 26, 2012 (the Petition Date), the Debtor filed a voluntary petition (the
Petition) for relief under chapter 11 of title 11 of the United States Code, 11 U.S.C. 101
et seq. (the Bankruptcy Code), in an effort to preserve and maximize the value of its chapter 11
estate. The Debtor has been operating its business and managing its properties as a debtor-in-
possession under sections 1107(a) and 1108 of the Bankruptcy Code since the Petition Date.
a. The DIP Financing Motion
31. On July 19, 2012, the Debtor filed its Emergency Motion for (A) Approval of
Interim Order Pursuant to 11 U.S.C. 105, 361, 362, 363(c), 364(c), 364(d), and 364(e) and
Fed. R. Bankr. P. 2002, 4001, and 9014 (I) Authorizing Debtor to Obtain Post-Petition Secured
Financing, (II) Granting Security Interests and Superpriority Administrative Expense Claims,
and (III) Authorizing the Use of Cash Collateral [Dkt. No. 200] (the Emergency DIP Motion).
4838-9404-7505.4
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Through the Emergency DIP Motion, the Debtor sought approval of its interim debtor in
possession financing agreement (the Interim DIP Loan) with Alpine and use of cash collateral.
On July 27, 2012, the Court entered an Interim Order approving the Emergency DIP Motion
[Dkt. No. 270] (the Interim Order). Under the Interim Order, the Court authorized the Debtor
to use cash collateral and approved the DIP financing as provided therein through August 31,
2012. The Court also set a final hearing on the Emergency DIP Motion for August 27, 2012.
Subsequent to entry of the Interim Financing Order, the Debtor and Alpine worked diligently to
negotiate the terms of a final debtor in possession financing agreement. On August 22, 2012,
concerned regarding the impending expiration date of the Interim Order, the Debtor filed a
Motion to (A) Extend and Increase Interim Financing and (B) Extend Use of Cash Collateral
Under the Terms of the Prior Order (the Motion to Extend Interim Financing). On August 27,
2012, the Court entered an order granting the Motion to Extend Interim Financing, thereby
extending the Interim Order and approved an increase in the borrowing limit.
32. After much negotiation, the Debtor and Alpine reached agreement as to the terms
of a final debtor in possession post-petition financing arrangement. On August 30, 2012, the
Debtor filed its Motion for Final Order Approving Debtor-in-Possession Financing, Use of Cash
Collateral and Adequate Protection (the Final DIP Loan Motion) [Dkt. No. 402]. Wilhelm and
The Rush Family Trust consented to the relief requested, while the Committee advised the
Debtor and Alpine that the Committee intended to object to the Final DIP Loan Motion. The
Court set the hearing on the Final DIP Loan Motion for September 17, 2012. In light of the
settlement discussions, described below, Alpine agreed to a short extension of the Interim DIP
Loan (which extension was previously approved by the Court [Dkt. No. 457]), the Committee
consented to such extension, and the Court continued the hearing on the Final DIP Loan Motion
to September 27, 2012, at 3:00 p.m. Pursuant to the Term Sheet, the Final DIP Loan Motion was
modified by the agreement of the parties and the Court approved the Final DIP Loan Motion, as
modified by order entered on September 28, 2012 [Dkt. No. 495].
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b. The Trustee Motion
33. On July 24, 2012, the Member Representatives filed a Motion to Appoint a
Chapter 11 Trustee (the Trustee Motion). The Committee, the CPOA, the CMD and
approximately 600 individuals claiming to be members and/or former members of the Club filed
joinders to the Trustee Motion. The Debtor filed opposition to the Trustee Motion and Wilhelm
filed a joinder to the Debtors opposition.
34. The Court set the matter for trial to commence on October 1, 2012, and set an
abbreviated discovery schedule.
35. On September 12-13, 2012, a mediation, which included within its scope the Final
DIP Loan Motion, the ongoing chapter 11 case, the Trustee Motion, the CTC Lawsuit, and the
Class Action Lawsuit was held in an effort to achieve a global settlement of the disputes between
the parties. The parties to the mediation included the Debtor, the Member Representatives, the
Committee, the CPOA, and CMD, Wilhelm, Alpine, and representatives of the other Approving
Parties. After extensive negotiations, the parties reached settlement of many of the major
disputes, which settlement terms are set forth in the Term Sheet. See Exhibit 1, hereto.
36. On September 25, 2012, the Debtor and certain other Approving Parties submitted
a Stipulation to Vacate Trial Date, under which they sought to vacate the dates related to the
Trustee Motion, including trial and discovery [Docket No. 486]. On September 26, 2012, the
Court approved such Stipulation [Docket No. 489].
II. JURISDICTION
37. The Court has jurisdiction over this matter pursuant to 28 U.S.C. 157 and
1334. This matter is a core proceeding within the meaning of 28 U.S.C. 157(b)(2). Venue is
proper pursuant to 28 U.S.C. 1408 and 1409.
38. The statutory bases for the relief requested herein are section 105 of the
Bankruptcy Code and Bankruptcy Rule 9019.
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III. SETTLEMENTS
A summary of the Term Sheets material terms, including the items that the Debtor and
other Approving Parties specifically request immediate approval of, are set forth below:
A. Summary of Term Sheet
1

a. The DIP Loan
39. The Debtor and other Approving Parties consented to the entry of the order
approving the Final DIP Loan Motion as contemplated by the Term Sheet. However, the Final
DIP Loan was modified as follows:

(i) The amount in the budget attached to the Final DIP Loan Motion provides
for professional fees of $965,000. It is agreed that Budget in the Final DIP
Loan Motion will be revised to provide that an amount of $300,000 for
professional fees shall be reserved exclusively for payment of the fees and
expenses incurred by professionals retained on behalf of the Committee
and expenses of members of the Committee (the $300,000 together with
the $50,000 previously paid to the Committee shall be collectively
referred to as the Committee Carveout). To the extent allowed
professional fees and expenses of the Committee and expenses of
members of the Committee are less than the Committee Carveout, any
amounts remaining shall be available for payment of allowed
administrative expenses of the Debtor. To the extent any such Committee
professionals and/or member fees and expenses exceed the Committee
Carveout, they will not be entitled to further payment until professionals
retained by the Debtor have received an equivalent pro rata payment; and

(ii) Alpine has consented to the Term Sheet and it is agreed that if and to the
extent the Final DIP Loan is inconsistent with any term, provision or
condition of the Term Sheet, the Final DIP Loan shall be deemed amended
so that it is consistent with the Term Sheet. Without limiting the
generality of the foregoing, performance by any of the Parties of the Term
Sheet shall not be a default under the Final DIP Loan.

1
Defined terms under the heading summary of Term Sheet shall have the meaning set forth in the Term
Sheet unless otherwise provided for herein, and the Term Sheet shall control to the extent of any inconsistencies.
4838-9404-7505.4
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A hearing was held on September 27, 2012 and the Court approved the Final DIP Loan, which
includes the above terms. Therefore, no further approvals of this portion of the Term Sheet are
sought in this Motion.
b. Partial Settlement of Class Action Lawsuit
40. Not later than October 5, 2012, the Member Representatives will file appropriate
pleadings in the Class Action Lawsuit (Class Action Settlement Motion) seeking approval of
the settlement of the Class Action Lawsuit as provided in the Term Sheet (the Class Action
Settlement) and will recommend and request that a hearing is scheduled on the Class Action
Settlement Motion such that appropriate notices are provided to Class Members and that the
deadline to opt out of the Class Action Settlement is November 30, 2012.
41. The Term Sheet contemplates that certain rights of the Class Action Lawsuit
plaintiffs will be compromised. The Class Action Settlement, as well as any releases related
thereto, are subject to the approval of the Eagle County District Court in the Class Action
Lawsuit and shall not become effective unless and until so approved. The Member
Representatives agree to recommend such approval by the Eagle County District Court. The
Member Representatives further agree to disseminate, either by email or United States mail, a
letter to the Class Members to be included in the notice of settlement recommending approval of
the Class Action Settlement. The Member Representatives and any of the CTC Individuals and
the CPOA Individuals who are Class Members agree to not opt out of the partial settlement of
the Class Action Lawsuit. Upon approval of the Class Action Settlement by the Eagle County
District Court and this Court, any objection by the Committee or the Debtor to use of proceeds
from any applicable insurance policy to defend the Class Action Lawsuit shall be deemed
withdrawn and consent to use of such proceeds to defend the Class Action Lawsuit shall be
deemed granted.
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42. Upon approval of the Class Action Settlement by the Eagle County District Court
and this Court, the Member Representatives shall promptly file a Notice of Withdrawal of their
Verified Motion for Issuance of Contempt Citation as against the Debtor, WFP and Wilhelm and
shall not refile such motion.
43. If the Class Action Settlement is approved by the Eagle County District Court and
this Court, then all claims and causes of action which the Debtor may have or could have
asserted against any member who elects to opt out of the Class Action Settlement shall be
transferred and assigned to Wilhelm.
c. Settlement of CTC Lawsuit
44. The parties shall resolve the CTC Lawsuit as described below.

(i) Payment by CPOA and CTC: In consideration of the releases provided in
the Term Sheet, the CPOA and CTC shall pay the sum of $2,350,000
(CTC Settlement Payment) upon entry of an order by this Court
approving this Joint Motion, which order shall have become final and not
subject to any further appellate review. $1,600,000 of the CTC Settlement
Payment shall be held in a separate escrow account by the Debtor (the
CTC Escrow) and shall be used and applied only as permitted by the
Term Sheet. $750,000 of the CTC Settlement Payment shall be paid to
Wilhelm. CGH, CFB, WFP, WFPI, CGHM, Alpine, Wilhelm, P.
Wilhelm, and Rush will not assert any claim or lien against or any
distribution from any portion of the CTC Escrow. Substantially
contemporaneous upon payment of the CTC Settlement Payment,
Plaintiffs in the CTC Lawsuit will file a Joint Notice of Dismissal with
Prejudice of the CTC Lawsuit with the Eagle County District Court, which
Joint Notice will have been executed and held by Plaintiffs pending
receipt by Wilhelm of the $750,000.

(ii) The mutual releases contained in the Term Sheet at Section 2.a.i, as they
relate to the CTC Lawsuit, shall be effective upon approval by this Court
of the CTC Lawsuit Settlement and payment by the CPOA and CTC
described in the Term Sheet at Section 2.a.ii.
(iii) Distribution of the CTC Settlement Payment: Upon confirmation of the
Joint Plan, as provided for in the Term Sheet, the CTC Escrow shall be
used as follows: (1) for payment of non-member priority claims; and
(2) for the payment of unsecured claims for goods and services
(collectively Trade Claims), provided that the total payments shall be
the lesser of $600,000 or the allowed amount of the Trade Claims. The
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balance of the CTC Escrow shall be utilized to pay any allowed unpaid
administrative expenses for professionals retained at the expense of the
estate. To the extent of any excess, the CTC Escrow will be used to fund
Plan payments as provided under the Term Sheet at Section 2.a.iii.
45. Mutual Releases: The Debtor, CGH, WFP, CFB, WFPI, CGHM, CFB, Wilhelm
and P. Wilhelm (and their affiliates), on the one hand, and the Committee, CTC, CPOA, CMD,
CVCPOA, TSPOA, the Member Representatives, individually and as representatives of the
certified class represented by the Member Representatives, and each of the members of such
class who do not opt out of this settlement (subject to approval by the Eagle County District
Court), and each member and former member not represented by the Class, and all past, present,
and future board members and officers of CTC, CPOA, CMD, CVCPOA, and TSPOA, including
but not limited to those named as Defendants in the CTC Lawsuit and including but not limited
to the CPOA Individuals and the CTC Individuals, on the other hand, and their respective
affiliates, agents, attorneys, representatives, successors and assigns, will fully and forever
release, discharge, waive and acquit one another and their respective affiliates, agents,
employees, consultants, attorneys, representatives, predecessors, successors, shareholders,
officers, directors, Committee members, limited liability company members, heirs and assigns,
from and against any and all offsets, defenses, claims, counterclaims, actions, proceedings,
obligations, demands, debts, causes of action, and any other liability or loss, whether known or
unknown, at law or in equity (collectively, Claims), arising out of any fact, matter, act or
circumstance from the beginning of time to the date of the Term Sheet that relates to the
Bankruptcy Case, the CTC Lawsuit, the Class Action Lawsuit or the Club at Cordillera and all
matters related, connected or incidental thereto. Without limiting the generality of the foregoing,
(i) all claims in the CTC Lawsuit are resolved and the plaintiffs in the CTC Lawsuit will file a
Notice of Dismissal with prejudice with the District Court, Eagle County Colorado, upon
payment of the CTC Settlement Payment; (ii) any claims against any member or former member
for 2011 or 2012 Club dues, Club minimums, or late fees or other alleged obligations are
4838-9404-7505.4
14
released; provided, however, any obligations which arose on or after June 26, 2012 related to
actual use of facilities owned by the Debtor or actual receipt of actual services from the Debtor
(including, without limitation, food and drink, or use of any of the golf facilities) shall not be
released. Further, all members who have or in the future resign from the Club at Cordillera are
released from any liability associated with the Membership Documents (as described in the Term
Sheet), including any obligation to continue paying dues for any period into the future. Finally,
the Membership Documents will be deemed rejected as executory contracts pursuant to section
365 of the Bankruptcy Code and members will be deemed to have waived claims arising out of
rejection of such Membership Documents, save and except only claims for member deposits as
provided herein. Notwithstanding the foregoing, the releases provided in this paragraph shall not
extend to the following:

(i) The Claims asserted by the Member Representatives and the members of
the certified class represented by the Member Representatives in the Class
Action Lawsuit, nor to any of the defenses and offsets thereto in the Class
Action Lawsuit by the Debtor, CGH, WFP, WFPI, CFB, CGHM, Wilhelm
and P. Wilhelm; provided that recovery by the Member Representatives
and the members of the certified class represented by the Member
Representatives in the Class Action, if any, shall be limited to any
insurance coverage applicable to such claims and the proceeds of such
coverage, regardless of whether any such coverage is ultimately available.
Debtor, CGH, WFP, CFB, WFPI, CGHM, Wilhelm, and P. Wilhelm make
no representation regarding the existence or availability of any insurance
coverage for the Class Action Lawsuit and retain all rights under any
potentially applicable policy of insurance. However, the Debtor, CGH,
WFP, CFB, WFPI, CGHM, Wilhelm, and P. Wilhelm do specifically
warrant and represent that the Disclosure made by them in the Class
Action Lawsuit, pursuant to C.R.C.P. 26(a)(1), with respect to insurance
coverage, is true, accurate and complete. Nothing in the Term Sheet shall
be deemed or construed as an admission of liability or as an admission of
any measure of damages by the Debtor, CGH, WFP, CFB, WFPI, CGHM,
Wilhelm or P. Wilhelm related to any claim asserted against them in the
Class Action. Member Representatives and the members of the certified
class represented by the Member Representatives in the Class Action
hereby covenant not to execute any judgment or assert any claim for
attorneys fees or costs against the assets of Debtor, CGH, WFP, CFB,
WFPI, CGHM, Wilhelm or P. Wilhelm, other than their rights to any
applicable insurance coverage;
4838-9404-7505.4
15

(ii) The Claims of all members and former members of the Cordillera Club for
the return of deposits paid in connection with their club memberships, who
timely file proof of claims, shall be deemed allowed in favor of each such
member (the Member Deposit Claims) but subordinated as further
provided herein; provided, however, that nothing herein shall restrict the
right of the Debtor or any other party in interest to object to a Member
Deposit Claim to the extent such claim exceeds the amount of the
deposit(s) actually paid by such member. Proof of such claims, which
must be in accordance with the Term Sheet, may be included in a proof of
claim filed by the Class Representatives on behalf of the class members as
a class proof of claim;

(iii) Any claim of any Party for a breach of any obligation imposed by the
Term Sheet;

(iv) Any secured claim for unpaid real property or business personal property
taxes;

(v) The claim of Alpine, which, subject to verification as to calculation of
amount only, shall be deemed to be an allowed secured claim in the
amount of $13,037,559.18, plus such amounts, if any as are allowable
under 11 U.S.C. 506(b), plus the amounts advanced pursuant to or
otherwise due and owing with respect to the Final DIP Loan;

(vi) The claim of Wilhelm, which, subject to verification as to calculation of
amount only, shall be deemed an allowed secured claim in the amount of
$7,532,837.05, plus such amounts, if any, as are allowable under
11 U.S.C. 506(b) (the Wilhelm Claim). The Wilhelm Claim will be
inclusive of all claims of Dr. Jeffrey Rush and the Rush Family Trust
(collectively Rush) and any person or entity acting in whole or in part
through Rush and the Rush claims will not be separately allowed;

(vii) There has been no agreement to or settlement of any claim for any
administrative expense and the Parties reserve all of their rights with
respect to any past or future application by a party seeking allowance of an
administrative expense claim; and

(viii) Claims, if any, which the Debtor, CGH, CFB, WFP, WFPI, CGHM,
Wilhelm or P. Wilhelm may have against any member who exercises the
right to opt out of the Class Action Settlement.
46. Sale of Assets: The Approving Parties to the Term Sheet have agreed to and shall
take steps to implement a process for the sale of the Debtors operating assets. The Debtor and
the Committee shall jointly prepare and file with this Court, after consultation with the
4838-9404-7505.4
16
Approving Parties about the form thereof, a joint motion seeking approval of bidding procedures
(Sale Procedures Motion), and further seeking approval of the sale of all the Debtors
operating assets, pursuant to the Term Sheet and bidding procedures, free and clear of all liens
(other than liens which arise from unpaid real property taxes and/or all business personal
property taxes), claims, encumbrances and interests (including, without limitation free and clear
of all claims, interests or rights which may arise out of Membership Documents) pursuant to
sections 363(b) and (f) of the Bankruptcy Code (the Sale Motion). The Sale Procedures
Motion shall contain at least the following provisions:

(i) That bids must be for all operating assets owned by the Debtor and must
be received by December 3, 2012 (the Bid Deadline); provided that if
the holder of the Alpine claim or the Wilhelm claim desire to credit bid,
they must give written notice of their intent to do so by Thursday,
December 6, 2012;

(ii) If more than one qualifying bid is received or if a timely notice of an
intent to credit bid has been provided, then an auction will be held on
December 10, 2012 to select the highest and best bid;

(iii) That all bidders must qualify to bid;

(iv) That all bids must be for all cash, except that the holders of the Alpine
Claim and Wilhelm Claim can credit bid their allowed secured claims
including, in the case of Alpine, any amounts owed under or with respect
to the Final DIP Loan; provided that any bid of the holder of the Wilhelm
Claim must be a cash bid up to the amounts to which Alpine is entitled
under the Term Sheet plus taxes then due secured by a lien on the assets
sold;

(v) That all bids must seek to purchase all the Debtors operating assets;

(vi) That the highest bidder must close pursuant to its bid no later than
December 28, 2012 (the Closing). Time is of the essence.

(vii) That the sale of the assets will be free and clear of all interests. The sale,
however, shall not be free and clear of recorded covenants, declarations,
PUDs, easements, and other similar recorded documents to which the liens
securing the Alpine allowed secured claim are subject. Further, the sale
shall not be free and clear of liens for any unpaid real property taxes
and/or all business personal property taxes. The sale shall be on an as is
4838-9404-7505.4
17
basis without representation or warranty of any kind (other than as to
authority);

(viii) That the Mediator shall conduct the sale process, subject to ultimate
approval by the Court;

(ix) That current and former members of the Cordillera Club and prospective
bidders with an interest in less than all of the assets (including various
member groups) may approach, discuss and agree with other parties about
submitting a joint bid for all of the assets; and

(x) The order approving any sale shall require payment of allowed secured
claims at or about Closing to the extent cash is available from the sale.
47. Successful Bidder: If Wilhelm or any affiliate of Wilhelm or any entity in which
Wilhelm or any Wilhelm affiliate (collectively, Wilhelm Party) owns an interest, is selected as
the successful bidder at the sale of the Debtors assets as provided for herein, then such Wilhelm
Party shall transfer or cause to be transferred the Debtors ownership interest in (a) the Short
Course, (b) the Trailhead facilities and (c) the Athletic Club facilities (collectively the Non-
Essential Assets) to an entity (other than CTC) to be jointly designated by the CMD, the CPOA
and the Member Representatives for no additional consideration simultaneously with the later of
closing of the sale of the Debtors assets to such Wilhelm Party or approval of this Joint Motion
and the Class Action Settlement Motion. Additionally, if any Wilhelm Party is selected as the
successful bidder at the sale of the Debtors assets as provided for herein, and if memberships are
offered in a club which utilizes any of those assets, then the memberships must be offered to all
past and present members of the Club on the same terms as anyone else.
48. Plan of Reorganization: The Debtor and the Committee shall jointly prepare and
file a Joint Plan of Reorganization and related Disclosure Statement and diligently pursue
approval of the Disclosure Statement and confirmation of the Plan. The Plan and Disclosure
Statement will be filed with this Court so that hearing on confirmation of the Plan can be held
between December 10, 2012 and December 28, 2012, subject to the Courts calendar. The Plan
shall:

4838-9404-7505.4
18
(i) Provide for the implementation of the various settlements and
consummation of the sale process provided for in the Term Sheet.
However, except as otherwise provided in the Plan, confirmation of the
Plan shall not be a condition precedent to either the settlements or
consummation and closing pursuant to the sale process contemplated by
the Term Sheet. In the event that the Bankruptcy Case is dismissed or
converted to Chapter 7, the CTC Escrow shall be used pursuant to further
order of the Court;

(ii) Provide for the distribution of any cash proceeds attributable to the sale of
the Debtors assets still in the possession of the Debtor (which does not
include the CTC Escrow) (save and except only the Non-Party Assets) as
follows: (1) first, to Alpine to the extent necessary to repay amounts
advanced by the Bank pursuant to, or otherwise due and owing with
respect to the DIP Loan, including interest, (2) second, to Alpine to the
extent necessary to satisfy Alpines allowed secured claim, (3) third, the
holder of the Wilhelm Claim to the extent necessary to satisfy the Wilhelm
Claim, (4) fourth, to satisfy any remaining allowed and unpaid
administrative expense claims, if any, (5) fifth, to any Trade Claim
unsecured creditors to the extent not paid in full from the CTC Escrow,
and other unsecured creditors, including the members, pro rata according
to the gross amount of such allowed claims, to satisfy their allowed
unsecured claims for deposits, and (6) the balance shall be paid to the
holder of equity interests in the Debtor. No distributions shall be made to
Rush or any affiliates of Rush on account of any alleged unsecured claim
for money loaned to the Debtor or obligations allegedly guaranteed by the
Debtor. Amounts, if any, alleged to be owed arising from the sale of any
Non-Party Asset shall be paid to the holder of the allowed claim related to
such Non-Party Asset;

(iii) Provide for the distribution of the CTC Escrow as provided in
paragraph 2(a)(iii) of the Term Sheet;

(iv) Contain such other provisions as may be reasonably necessary or desirable
to implement the Term Sheet; and

(v) Not contain any provisions which are inconsistent with the Term Sheet or
with orders entered by the Bankruptcy Court approving the 9019 Motion
contemplated by the Term Sheet or with the sale process described in the
Term Sheet.
4838-9404-7505.4
19
IV. RELIEF REQUESTED
49. By this Joint Motion, the Debtor seeks entry of the Order, substantially in the
form attached hereto as Exhibit 2, approving the Term Sheet, and approving and authorizing
the Debtor to effectuate certain settlements and compromises set forth therein, as follows:

(i) Partial Settlement of Class Action: The Term Sheet provides for a partial
settlement of the Class Action for class members who do not opt out after
a notice period. Those remaining in the class are limited to seeking
recovery of any judgment obtained in their favor solely from proceeds of
the insurance policy and not from the Debtor or any of the other
defendants in the Class Action Lawsuit. Those members of the Class
remaining in the class shall also be included in the mutual release
described in the Term Sheet. Upon this Court's approval of this Joint
Motion, relief from stay shall be deemed granted to allow the Class Action
Lawsuit to proceed against the Debtor with recovery limited to insurance
proceeds, as provided in the Term Sheet. The Debtor and Wilhelm make
no representation or warranty that the claims asserted in the Class Action
Lawsuit are covered by the insurance policy. The parties will seek court
approval of the Class Action Settlement in the District Court for Eagle
County as provided in the Term Sheet. The mutual releases provided for
in the Term Sheet shall not be effective until approval by this Court and
the District Court for Eagle County. After approval of the Class Action
Settlement by the Eagle County District Court and this Court, with respect
to members who elect to opt out of the Class Action Settlement, the
Debtor shall assign and transfer all claims and causes of action it could
have or may have asserted against any member that opts out of the Class
Action Settlement to Wilhelm;

(ii) Mutual Releases. The Term Sheet provides for certain other mutual
releases, compromises, agreements, and settlements as provided in
Section 2.a.i (subject to the carve-outs) and the Joint Motion seeks Court
approval of same.

(iii) Membership Documents: Membership Documents, as defined in the Term
Sheet, shall be deemed rejected and members will be deemed to have
waived claims arising out of rejection of such Membership Documents,
except with respect to the claim for member deposits as provided for in the
Term Sheet.

(iv) Settlement of the CTC Lawsuit: Upon Court approval of this Joint Motion
and payment of the CTC Settlement Payment, the parties shall dismiss the
CTC Lawsuit and the mutual releases contained in Section 2.a.i related to
the CTC Lawsuit shall become effective;
4838-9404-7505.4
20

(v) Allowance of Alpines Claim: Subject to verification as to calculation of
amount only, the Alpine claim (as evidenced by the Alpine Loan
Documents and as described in the Term Sheet) shall be deemed to be an
allowed secured claim in the amount of $13,037,559.18, plus such
amounts, if any as are allowable under 11 U.S.C. 506(b), plus the
amounts advanced pursuant to or otherwise due and owing with respect to
the Final DIP Loan;

(vi) Allowance of Wilhelms Claim: Subject to verification as to calculation
of amount only, the Wilhelm Claim (as defined in the Term Sheet) shall be
deemed an allowed secured claim in the amount of $7,532,837.05, plus
such amounts, if any, as are allowable under 11 U.S.C. 506(b). The
Wilhelm Claim will be inclusive of all claims of Rush and any person or
entity acting in whole or in part through Rush and the Rush claims will not
be separately allowed; and

(vii) Club Member Claims: The Claims of members and former members of
the Cordillera Club for the return of deposits paid in connection with their
club memberships, who timely file proof of claims, shall be deemed
allowed in favor of each such member (the Member Deposit Claims),
but subordinated as provided in the Term Sheet at Section 2.a.i.2 and
Section 4.b; provided, however, that nothing in the Term Sheet shall
restrict the right of the Debtor or any other party in interest to object to a
Member Deposit Claim to the extent such claim exceeds the amount of the
deposit(s) actually paid by such Member. Proof of such claims, which
a class proof of claim.
(viii) Non Disparagement: The Debtor and the Approving Parties seek approval
of their agreement that the Debtor and the Approving Parties agree that in
future communications with third parties, they shall not make disparaging
statements about one another; provided that this provision shall not limit
the parties or a witness in the pursuit or defense of the claims or in
presenting any testimony or conducting or participating in any discovery
in the Class Action Lawsuit, and provided further that the Committee,
CTC, CVCPOA, TSPOA, CMD, CPOA and Member Representatives
shall have no liability for statements made by any other individual
property owner or other class member, including but not limited to
statements made in any meeting or other forum sponsored or held by the
CMD and/or the CPOA.
(ix) Debtors Representation of Disclosure: The Debtor, CGH, WFP, CFB,
WFPI, CGHM, Wilhelm, and P. Wilhelm do specifically warrant and
represent that the Disclosure made by them in the Class Action Lawsuit,
4838-9404-7505.4
21
pursuant to C.R.C.P. 26(a)(1), with respect to insurance coverage, is true,
accurate and complete as set forth in the Term Sheet at Section 2.a.i.1.
(x) Wilhelms Obligation if Successful Bidder: If any Wilhelm Party is
selected as the successful bidder at the sale of the Debtors assets as
provided for herein, then if memberships are offered in a club which
utilizes any of those assets, then the memberships must be offered to all
past and present members of the Club on the same terms as anyone else as
set forth in the Term Sheet at Section 5.k.
50. The Debtor and other Approving Parties further request that the Court provide a
hearing date for approval of the joint disclosure statement and plan of reorganization consistent
with the terms of the Term Sheet, without prejudice or in any way ruling on the ultimately
confirmability of any such plan.
V. BASIS FOR RELIEF
51. Debtor and the Committee seek entry of an Order authorizing the entry into the
Term Sheet and approving certain matters set forth therein, as described above, pursuant to Fed.
R. Bankr. P. 9019. The law generally favors compromises and settlements of disputes between
parties. See Stanpec Corp. v. Jelco, Inc., 464 F.3d 1184 (10th Cir. 1972).
52. Fed. R. Bankr. P. 9019 provides that, after a hearing on notice to creditors, the
bankruptcy court may approve a compromise or settlement. The standards by which to evaluate
a settlement proposal have been defined by the courts. Kaiser Steel Corp. v. Frates (In re Kaiser
Steel Corp.), 105 B.R. 971, 976 (D.Colo.1989). In general, the court must determine whether
the settlement is fair and equitable and in the best interests of the estate. Id. The factors to
consider in this determination are (1) the probability of success on the merits in the litigation;
(2) the difficulties, if any, to be encountered in collection of any judgment that might be
obtained; (3) the complexity of the litigation involved, and the expense, inconvenience and delay
necessarily attending it; and (4) the paramount interests of creditors and the proper deference to
their reasonable views in the premises. Id. at 976-77.
53. Entry into the Term Sheet and settlement thereunder is appropriate and consistent
with the 9019 factors set forth above. The terms of the Term Sheet are fair and reasonable, and
4838-9404-7505.4
22
entering into the Term Sheet is a sound exercise of Debtors business judgment that is supported
by all major constituencies and will resolve the Trustee Motion, the CPOA/CTC litigation and
streamline the estate's interests in the Class Action Lawsuit. Approval of the Term Sheet will
avoid further dispute regarding the Trustee Motion, CTC Lawsuit and the claims of Alpine and
Wilhelm and does so without the need to engage in costly litigation. Such litigation would have
generated substantial administrative expenses. In addition, resolution of the Trustee Motion and
submission of a joint plan with the Committee will allow Debtor to proceed with the orderly
administration of its estate. Accordingly, Debtor submits that entry into the Term Sheet is
appropriate, in the best interests of their estates and all stakeholders, and should be approved
under Bankruptcy Rule 9019.
WHEREFORE, Debtor moves for entry of an Order, substantially in the form attached
hereto as Exhibit 2, approving the terms of and authorizing Debtor to enter into the Term Sheet
attached hereto as Exhibit 1, and granting such other relief as deemed appropriate.

4838-9404-7505.4
23
Date: October 5, 2012 Respectfully submitted,

FOLEY & LARDNER LLP

By: /s/ Christopher Celentino
Christopher Celentino (CA No. 131688)
Mikel Bistrow (CA No. 102978)
Dawn A. Messick (CA No. 236941)
Admitted Pro Hac Vice
402 West Broadway, Suite 2100
San Diego, California 92101
Telephone: 619-234-6655
Facsimile: 619-234-3510
Email: ccelentino@foley.com
Email: mbistrow@foley.com
Email: dmessick@foley.com

-and-

SENDER & WASSERMAN, P.C.
Harvey Sender, #7546
1660 Lincoln Street, Suite 2200
Denver, CO 80264
Telephone: 303-296-1999
Facsimile: 303-296-7600
Email: sender@sendwass.com

Attorneys for Debtor and Debtor-in-Possession

-AND-
HOLLAND & HART LLP
By: /s/ Risa Lynn Wolf-Smith
Risa Lynn Wolf-Smith, #15835
Clarissa M. Raney, #40374
HOLLAND & HART LLP
555 Seventeenth Street, Suite 3200
Denver, Colorado 80202
Telephone: 303-295-8000
Facsimile: 303-295-8261
rwolf@hollandhart.com
cmraney@hollandhart.com

-and-
4838-9404-7505.4
24

MUNSCH HARDT KOPF & HARR, P.C.
Russell L. Munsch (admitted PHV)
Texas Bar No. 14671500
Joseph J. Wielebinski (admitted PHV)
Jay H. Ong (admitted PHV)
Zachery Z. Annable (admitted PHV)
3800 Lincoln Plaza
500 N. Akard Street
Dallas, Texas 75201-6659
Telephone (214) 855-7500
Facsimile (214) 978-4335

ATTORNEYS FOR THE OFFICIAL
COMMITTEE OF UNSECURED CREDITORS

4838-9404-7505.4
25
Exhibit 1
(Term Sheet)
Case:12-24882-ABC Doc#:519-1 Filed:10/05/12 Entered:10/05/12 13:38:53 Page1 of 29

4266769.1
TERM SHEET
This Term Sheet is made and entered into as of this 17th day of September, 2012, by and
between CORDILLERA GOLF CLUB, LLC a Delaware limited liability company (Debtor),
The OFFICIAL COMMITTEE OF UNSECURED CREDITORS appointed in the Bankruptcy
Case (as defined herein) of CORDILLERA GOLF CLUB, LLC (Committee), CORDILLERA
GOLF HOLDINGS, LLC, a Delaware limited liability company (CGH), CORDILLERA F &
B, LLC, a Delaware limited liability company or any successor thereto (CFB),WFP
CORDILLERA, LLC, a Delaware limited liability company (WFP), WFP INVESTMENTS,
LLC, a Delaware limited liability company (WFPI), CGH MANAGER, LLC, a Delaware
limited liability company (CGHM), DAVID A. WILHELM (Wilhelm), PATRICK
WILHELM (P. Wilhelm), CORDILLERA TRANSITION CORPORATION, INC., a Colorado
not for profit corporation (CTC), CORDILLERA PROPERTY OWNERS ASSOCIATION,
INC., a Colorado not for profit corporation (CPOA), CORDILLERA METROPOLITAN
DISTRICT, a quasi-municipal corporation and political subdivision of the State of Colorado
(CMD), CORDILLERA VALLEY CLUB PROPERTY OWNERS ASSOCIATION, INC., a
Colorado not for profit corporation (CVCPOA), TIMBER SPRINGS PROPERTY OWNERS
ASSOCIATION, INC., a Colorado not for profit corporation (TSPOA), CHERYL M. FOLEY,
THOMAS WILNER, JANE WILNER, CHARLES JACKSON, MARY JACKSON, KEVIN B.
ALLEN, as representatives of a certified class in Case Number 11CV552, pending in the District
Court of Eagle County, Colorado (collectively, the Member Representatives) and ALPINE
BANK.
RECITALS
A. The parties to this Term Sheet are listed in the foregoing paragraph and are
sometimes referred to collectively in this Term Sheet as Parties.
B. The Debtor is the Debtor in Possession in connection with a Chapter 11
bankruptcy case pending in the United States Bankruptcy Court for the District of Colorado,
Case No. 12-24882-ABC (the Bankruptcy Case). The Debtor operates certain golf courses and
other amenities (collectively and generally referred to as the Club). Right to use of the Club is
governed by membership applications, membership plans, rules and regulations of the Club and
all amendments and modifications thereto (collectively Membership Documents).
C. The Committee is the official committee of unsecured creditors appointed by the
United States Trustee on July 6, 2012.
D. WFP is the holder of all of the limited liability company membership interests in
CGH.
E. CGH is the holder of all of the limited liability company membership interests in
the Debtor.

2

4266769.1
F. Wilhelm is the holder of all of the limited liability company membership interests
in WFP. P. Wilhelm is Wilhelms son.
G. The Debtor, CGH, WFP, Wilhelm, CTC, CPOA and various individuals: Glenn
Bourland, Lois Van Deusen, Roger Magid (collectively the CPOA Individuals), Robert
Vanourek, Denise Delaney, Gary Edwards, Raymond Oglethorpe, David Temin, Sarah Baker,
Nelson Sims, Dick Rothkopf, and David Bentley (collectively the CTC Individuals) are parties
to an action pending in the District Court, Eagle County Colorado, Case No. 2011CV456 (CTC
Lawsuit).
H. The Member Representatives, the Debtor, WFP, CGH, CFB, WFPI, CGHM,
CFB, Wilhelm and P. Wilhelm are (or were) parties to an action pending in the District Court,
Eagle County Colorado, Case No. 2011CV552 (Class Action Lawsuit).
I. Alpine Bank asserts that it is a secured creditor of the Debtor and claims a lien on
substantially all of the Debtors real and personal property used on or in connection with the
operation of the real property and the operation of the Debtors business. Alpine Bank asserts
that its claim is secured by a first lien on such property.
J. Wilhelm asserts that he is a secured creditor of the Debtor and claims a lien on
substantially all of the Debtors real and personal property used on or in connection with the
operation of the real property and the operation of the Debtors business. Wilhelm asserts that
his claim is secured by at least a second lien on such property. Wilhelm has also asserted a first
lien on personal property owned by the Debtor.
K. CMD claims to be a secured creditor of the Debtor for unpaid taxes. CMD asserts
a first priority lien for unpaid 2011 taxes in the amount of $205,311.31. CMD also asserts a first
priority lien for 2012 taxes that will become due in 2013 (the CMD Tax Claims).
L. In addition to Wilhelm and Alpine, certain assets of the Debtor are subject to
purchase money liens in favor of creditors who are not parties to this Term Sheet (the Purchase
Money Lien Assets). Further, certain assets used by the Debtor are leased from creditors who
are not parties to this Term Sheet and such assets are not owned by the Debtor (the Leased
Assets) (the Purchase Money Lien Assets and the Leased Assets shall be collectively referred to
the Non-Party Assets).
M. By Motion dated August 30, 2012, Docket No. 402 (DIP Loan Motion), the
Debtor has sought final approval of a loan by Alpine Bank to the Debtor and approval of the use
of cash collateral. The DIP Loan Motion is set for hearing on September 17, 2012. The
Committee, the Member Representatives, the CPOA and the CMD were prepared to file
objections to the DIP Loan Motion. Because of the settlement embodied in this Term Sheet, the
objections have not been filed.
N. By Motion dated July 24, 2012, Docket No. 235 (Trustee Motion), the Member
Representatives have sought the appointment of a trustee in connection with the Bankruptcy
Case. The Committee, the CPOA and the CMD filed Joinders in the Trustee Motion. In

3

4266769.1
addition, an additional 608 Personal Joinders have been filed by members of the certified class
represented by the Member Representatives and other parties, Docket No. 414. The Debtor filed
its Opposition to the Trustee Motion and Wilhelm filed a Joinder to such Opposition. The
Trustee Motion is set for hearing on October 1-3, 2012.
O. The parties to this Term Sheet may be parties to various other disputes which are
the subject of motions, responses, objections or pleadings pending before the Bankruptcy Court.
P. The parties to this Term Sheet attended a voluntary mediation on September 12
and 13, 2012 (Mediation). The mediator conducting the Mediation was Deborah Williamson
(Mediator). The Mediation resulted in various agreements among the Parties that will resolve
various disputes among them in the Bankruptcy Case, a complete settlement of the CTC Lawsuit
among the parties to the CTC Lawsuit, and a partial resolution of the Class Action Lawsuit.
Q. The purpose of this Term Sheet is to set forth the agreements of the Parties
reached at the Mediation and to establish a process and procedure for documenting, seeking any
necessary court approval and implementing those agreements.
SETTLEMENT TERMS AND AGREEMENTS
1. DIP Loan.
a. Interim DIP Loan. The interim debtor-in possession loan from Alpine to
the Debtor (the Interim DIP Loan) pursuant to the terms of the Interim
Order Pursuant to 11 U.S.C. 105, 361, 362, 363(c), 364(c), 364(d),
and 364(e) and Fed. R. Bankr. P. 2002, 4001 and 9014 (i) Authorizing
Debtor to Obtain Post-Petition Secured Financing, (ii) Granting Security
Interests and Superpriority Administrative Expense Claims, and (iii)
Authorizing the Use of Cash Collateral as Provided Herein, Dkt. #270, as
extended by the Order granting the Debtors Motion to (a) Extend and
Increase Interim Financing and (B) Extend Use of Cash Collateral Under
the Terms of the Prior Order, Dkt. #393 shall be further extended by order
of the Bankruptcy Court, through and including September 28, 2012, and
shall be increased in such amount as shall be necessary to meet such
expenses for such extension period as are consistent with the budget
attached to the DIP Loan Motion. The Parties have no objection and
hereby consent to the foregoing extension of the Interim DIP Loan for the
purpose of permitting the Parties to prepare and, where necessary, file
with the Bankruptcy Court certain other pleadings contemplated by this
Term Sheet including such revisions to the relief requested in the DIP
Loan Motion, the proposed order attached thereto, and the form of the
applicable loan documentation as are necessary to conform to this Term
Sheet.
b. Permanent DIP Loan. Subject to the performance and satisfaction of the
terms, provisions and conditions contained in this Term Sheet, the Parties

4

4266769.1
consent to the entry of an order approving the Final DIP Loan Motion as
contemplated by and defined in the DIP Loan Motion. However, the Final
DIP Loan will be modified as follows:
i. The amount in the budget attached to the DIP Loan Motion
provides for professional fees of $965,000. It is agreed that
Budget in the DIP Loan Motion will be revised to provide that an
amount of $300,000 for professional fees shall be reserved
exclusively for payment of the fees and expenses incurred by
professionals retained on behalf of the Committee and expenses of
members of the Committee (the $300,000 together with the
$50,000 previously paid to the Committee shall be collectively
referred to as the Committee Carveout). To the extent allowed
professional fees and expenses of the Committee and expenses of
members of the Committee are less than the Committee Carveout,
any amounts remaining shall be available for payment of allowed
administrative expenses of the Debtor. To the extent any such
Committee professionals and/or member fees and expenses exceed
the Committee Carveout, they will not be entitled to further
payment until professionals retained by the Debtor have received
an equivalent pro rata payment.
ii. Alpine Bank has consented to this Term Sheet and it is agreed that
if and to the extent the Final DIP Loan is inconsistent with any
term, provision or condition of this Term Sheet, the Final DIP
Loan shall be deemed amended so that it is consistent with this
Term Sheet. Without limiting the generality of the foregoing,
performance by any of the Parties of the Term Sheet shall not be a
default under the Final DIP Loan.
2. Settlement of Claims.
a. Not later than October 5, 2012, the Member Representatives will file
appropriate pleadings in the Class Action Lawsuit (Class Action
Settlement Motion) seeking approval of the settlement of the Class
Action Lawsuit as provided in this Term Sheet (the Class Action
Settlement) and will recommend and request that a hearing is scheduled
on the Class Action Settlement Motion such that appropriate notices are
provided to Class Members and that the deadline to opt out of the Class
Action Settlement is November 30, 2012. Not later than October 5, 2012,
the Debtor and the Committee shall file a Joint Motion, pursuant to Rule
9019 of the Federal Rules of Bankruptcy Procedure, seeking approval of
the various compromises and settlements provided in this Term Sheet (the
9019 Motion). Approval of the 9019 Motion shall be pursued by the
Debtor and the Committee with reasonable diligence and all parties hereto
shall cooperate in that regard. The 9019 Motion and the Class Action

5

4266769.1
Settlement Motion (to the extent of the settlement of the Class Action
Lawsuit) will seek approval of the following terms:
i. Mutual Releases. The Debtor, CGH, WFP, CFB, WFPI, CGHM,
CFB, Wilhelm and P. Wilhelm (and their affiliates), on the one
hand, and the Committee, CTC, CPOA, CMD, CVCPOA, TSPOA,
the Member Representatives, individually and as representatives of
the certified class represented by the Member Representatives, and
each of the members of such class who do not opt out of this
settlement (subject to approval by the Eagle County District
Court), and each member and former member not represented by
the Class, and all past, present, and future board members and
officers of CTC, CPOA, CMD, CVCPOA, and TSPOA, including
but not limited to those named as Defendants in the CTC Lawsuit
and including but not limited to the CPOA Individuals and the
CTC Individuals, on the other hand, and their respective affiliates,
agents, attorneys, representatives, successors and assigns, will fully
and forever release, discharge, waive and acquit one another and
their respective affiliates, agents, employees, consultants,
attorneys, representatives, predecessors, successors, shareholders,
officers, directors, Committee members, limited liability company
members, heirs and assigns, from and against any and all offsets,
defenses, claims, counterclaims, actions, proceedings, obligations,
demands, debts, causes of action, and any other liability or loss,
whether known or unknown, at law or in equity (collectively,
Claims), arising out of any fact, matter, act or circumstance from
the beginning of time to the date of this Term Sheet that relates to
the Bankruptcy Case, the CTC Lawsuit, the Class Action Lawsuit
or the Club at Cordillera and all matters related, connected or
incidental thereto. Without limiting the generality of the
foregoing, (i) all claims in the CTC Lawsuit are resolved and the
plaintiffs in the CTC Lawsuit will file a Notice of Dismissal with
prejudice with the District Court, Eagle County Colorado, upon
payment of the CTC Settlement Payment; (ii) any claims against
any member or former member for 2011 or 2012 Club dues, Club
minimums, or late fees or other alleged obligations are released;
provided, however, any obligations which arose on or after June
26, 2012 (the Petition Date) related to actual use of facilities
owned by the Debtor or actual receipt of actual services from the
Debtor (including, without limitation, food and drink, or use of any
of the golf facilities) shall not be released. Further, all members
who have or in the future resign from the Club at Cordillera are
released from any liability associated with the Membership
Documents, including any obligation to continue paying dues for
any period into the future. Finally, the Membership Documents
will be deemed rejected as executory contracts pursuant to section

6

4266769.1
365 of the Bankruptcy Code and members will be deemed to have
waived claims arising out of rejection of such Membership
Documents, save and except only claims for member deposits as
provided herein. Notwithstanding the foregoing, the releases
provided in this paragraph shall not extend to the following:
1. The Claims asserted by the Member Representatives and
the members of the certified class represented by the
Member Representatives in the Class Action Lawsuit, nor
to any of the defenses and offsets thereto in the Class
Action Lawsuit by the Debtor, CGH, WFP, WFPI, CFB,
CGHM, Wilhelm and P. Wilhelm; provided that recovery
by the Member Representatives and the members of the
certified class represented by the Member Representatives
in the Class Action, if any, shall be limited to any
insurance coverage applicable to such claims and the
proceeds of such coverage, regardless of whether any such
coverage is ultimately available. Debtor, CGH, WFP,
CFB, WFPI, CGHM, Wilhelm, and P. Wilhelm make no
representation regarding the existence or availability of any
insurance coverage for the Class Action Lawsuit and retain
all rights under any potentially applicable policy of
insurance. However, the Debtor, CGH, WFP, CFB, WFPI,
CGHM, Wilhelm, and P. Wilhelm do specifically warrant
and represent that the Disclosure made by them in the Class
Action Lawsuit, pursuant to C.R.C.P. 26(a)(1), with respect
to insurance coverage, is true, accurate and complete.
Nothing in this Term Sheet shall be deemed or construed as
an admission of liability or as an admission of any measure
of damages by the Debtor, CGH, WFP, CFB, WFPI,
CGHM, Wilhelm or P. Wilhelm related to any claim
asserted against them in the Class Action. Member
Representatives and the members of the certified class
represented by the Member Representatives in the Class
Action hereby covenant not to execute any judgment or
assert any claim for attorneys fees or costs against the
assets of Debtor, CGH, WFP, CFB, WFPI, CGHM,
Wilhelm or P. Wilhelm, other than their rights to any
applicable insurance coverage.
2. The Claims of all members and former members of the
Cordillera Club for the return of deposits paid in
connection with their club memberships, who timely file
proof of claims, shall be deemed allowed in favor of each
such member (the Member Deposit Claims) but
subordinated as further provided herein; provided,

7

4266769.1
however, that nothing herein shall restrict the right of the
Debtor or any other party in interest to object to a Member
Deposit Claim to the extent such claim exceeds the amount
of the deposit(s) actually paid by such member. Proof of
such claims, which must be in accordance with this Term
Sheet, may be included in a proof of claim filed by the
Class Representatives on behalf of the class members as a
class proof of claim.
3. Any claim of any Party for a breach of any obligation
imposed by this Term Sheet.
4. Any secured claim for unpaid real property or business
personal property taxes.
5. The claim of Alpine Bank, which, subject to verification as
to calculation of amount only, shall be deemed to be an
allowed secured claim in the amount of $13,037,559.18,
plus such amounts, if any as are allowable under 11 U.S.C.
506(b), plus the amounts advanced pursuant to or
otherwise due and owing with respect to the Final DIP
Loan.
6. The claim of Wilhelm, which, subject to verification as to
calculation of amount only, shall be deemed an allowed
secured claim in the amount of $7,532,837.05, plus such
amounts, if any, as are allowable under 11 U.S.C. 506(b)
(the Wilhelm Claim). The Wilhelm Claim will be
inclusive of all claims of Dr. Jeffrey Rush and the Rush
Family Trust (collectively Rush) and any person or entity
acting in whole or in part through Rush and the Rush
claims will not be separately allowed.
7. There has been no agreement to or settlement of any claim
for any administrative expense and the Parties reserve all of
their rights with respect to any past or future application by
a party seeking allowance of an administrative expense
claim.
8. Claims, if any, which the Debtor, CGH, CFB, WFP, WFPI,
CGHM, Wilhelm or P. Wilhelm may have against any
member who exercises the right to opt out of the Class
Action Settlement.
ii. Payment by CPOA and CTC. In consideration of the releases
provided herein, the CPOA and CTC shall pay the sum of

8

4266769.1
$2,350,000 (CTC Settlement Payment) upon entry of an order by
the Bankruptcy Court approving the 9019 Motion, which order
shall have become final and not subject to any further appellate
review. $1,600,000 of the CTC Settlement Payment shall be held
in a separate escrow account by the Debtor (the CTC Escrow)
and shall be used and applied only as permitted by this Term
Sheet. $750,000 of the CTC Settlement Payment shall be paid to
Wilhelm. CGH, CFB, WFP, WFPI, CGHM, Alpine Bank,
Wilhelm, P. Wilhelm, and Rush will not assert any claim or lien
against or any distribution from any portion of the CTC Escrow.
Substantially contemporaneous upon payment of the CTC
Settlement Payment, Plaintiffs in the CTC Lawsuit will file a Joint
Notice of Dismissal with Prejudice of the CTC Lawsuit with the
Eagle County District Court, which Joint Notice will have been
executed and held by Plaintiffs pending receipt by Wilhelm of the
$750,000.
iii. Distribution of the CTC Settlement Payment. Upon confirmation
of the Joint Plan, as provided herein, the CTC Escrow shall be used
as follows: (1) for payment of non-member priority claims; and
(2) for the payment of unsecured claims for goods and services
(collectively Trade Claims), provided that the total payments
shall be the lesser of $600,000 or the allowed amount of the Trade
Claims. The balance of the CTC Escrow shall be utilized to pay
any allowed unpaid administrative expenses for professionals
retained at the expense of the estate. To the extent of any excess,
the CTC Escrow will be used to fund Plan payments as provided
herein
iv. If the Class Action Settlement is approved by the Eagle County
District Court, then all claims and causes of action which the
Debtor may have or could have asserted against any member who
elects to opt out of the Class Action Settlement shall be transferred
and assigned to Wilhelm.
v. The Parties acknowledge that this Term Sheet and its releases are
entered into and given in compromise of disputed claims and that
this Term Sheet and the execution thereof shall not constitute any
acknowledgement or admission by any Party of any wrongdoing,
improper actions, liability or potential liability on the part of such
Party, and any such liability or wrongdoing is expressly denied.
vi. If Wilhelm or any affiliate of Wilhelm or any entity in which
Wilhelm or any Wilhelm affiliate (collectively, Wilhelm Party)
owns an interest, is selected as the successful bidder at the sale of
the Debtors assets as provided for herein, then such Wilhelm

9

4266769.1
Party shall transfer or cause to be transferred the Debtors
ownership interest in (a) the Short Course, (b) the Trailhead
facilities and (c) the Athletic Club facilities (collectively the Non-
Essential Assets) to an entity (other than CTC) to be jointly
designated by the CMD, the CPOA and the Member
Representatives for no additional consideration simultaneously
with the later of closing of the sale of the Debtors assets to such
Wilhelm Party or approval of the 9019 Motion and the Class
Action Settlement Motion.
vii. The Parties agree that in future communications with third parties,
they shall not make disparaging statements about one another;
provided that this provision shall not limit the parties or a witness
in the pursuit or defense of the claims or in presenting any
testimony or conducting or participating in any discovery in the
Class Action Lawsuit, and provided further that the Committee,
CTC, CVCPOA, TSPOA, CMD, CPOA and Member
Representatives shall have no liability for statements made by any
other individual property owner or other class member, including
but not limited to statements made in any meeting or other forum
sponsored or held by the CMD and/or the CPOA.
3. Sale of Assets. The Parties agree to and shall take steps to implement a process
for the sale of the Debtors operating assets. The Debtor and the Committee shall jointly prepare
and file with the Bankruptcy Court, after consultation with the Parties about the form thereof, a
joint motion seeking approval of bidding procedures (Bidding Procedures Motion). The
Debtor and the Committee shall also jointly prepare and file with the Bankruptcy Court, after
consultation with the Parties about the form thereof, a motion seeking approval of the sale of all
the Debtors operating assets, pursuant to this Term Sheet, free and clear of all liens (other than
liens which arise from unpaid real property taxes and/or all business personal property taxes),
claims, encumbrances and interests (including, without limitation free and clear of all claims,
interests or rights which may arise out of Membership Documents) pursuant to sections 363(b)
and (f) of the Bankruptcy Code (the Sale Motion). To the extent the Parties are unable to
agree upon the terms of either the Bidding Procedures Motion or the Sale Motion, the Mediator
shall resolve such disputes. A draft of the Bidding Procedures Motion and Sale Motion shall be
prepared by the Committee on or before October 5, 2012 and shall be filed not later than October
10, 2012 and shall collectively contain at least the following provisions:
a. That bids must be for all operating assets owned by the Debtor and must
be received by December 3, 2012 (the Bid Deadline); provided that if
the holder of the Alpine Bank claim or the Wilhelm claim desire to credit
bid, they must give written notice of their intent to do so by Thursday,
December 6, 2012. If more than one qualifying bid is received or if a
timely notice of an intent to credit bid has been provided, then an auction
will be held on December 10, 2012 to select the highest and best bid.
Case:12-24882-ABC Doc#:519-1 Filed:10/05/12 Entered:10/05/12 13:38:53 Page10 of
29

10

4266769.1
b. That all bidders must qualify to bid.
c. That all bids must be for all cash, except that the holders of the Alpine
Bank Claim and Wilhelm Claim can credit bid their allowed secured
claims including, in the case of Alpine Bank, any amounts owed under or
with respect to the Final DIP Loan; provided that any bid of the holder of
the Wilhelm Claim must be a cash bid up to the amounts to which Alpine
is entitled under this Term Sheet plus taxes then due secured by a lien on
the assets sold.
d. That all bids must seek to purchase all the Debtors operating assets.
e. That the highest bidder must close pursuant to its bid no later than
December 28, 2012 (the Closing). Time is of the essence.
f. That the sale of the assets will be free and clear of all interests. The sale,
however, shall not be free and clear of recorded covenants, declarations,
PUDs, easements, and other similar recorded documents to which the liens
securing the Alpine Bank allowed secured claim are subject. Further, the
sale shall not be free and clear of liens for any unpaid realpropertytaxes
and/or all business personal property taxes. The sale shall be on an
as is basis without representation or warranty of any kind (other than as
to authority).
g. That the Mediator shall conduct the sale process, subject to ultimate
approval by the Court.
h. That current and former members of the Club and prospective bidders
with an interest in less than all of the assets (including various member
groups) may approach, discuss and agree with other parties about
submitting a joint bid for all of the assets.
i. That a form of Asset Purchase Agreement shall be completed by not later
than October 5, 2012.
j. The order approving any sale shall require payment of allowed secured
claims at or about Closing to the extent cash is available from the sale.
4. Plan of Reorganization. The Debtor and the Committee shall jointly prepare and
file a Joint Plan of Reorganization and related Disclosure Statement and diligently pursue
approval of the Disclosure Statement and confirmation of the Plan. The Plan and Disclosure
Statement will be filed with the Bankruptcy Court so that hearing on confirmation of the Plan
can be held between December 10, 2012 and December 28, 2012, subject to the Courts
calendar. The Plan shall:
a. Provide for the implementation of the various settlements and
consummation of the sale process provided for in this Term Sheet.
29

11

4266769.1
However, except as otherwise provided in the Plan, confirmation of the
Plan shall not be a condition precedent to either the settlements or
consummation and closing pursuant to the sale process contemplated by
this Term Sheet. In the event that the Bankruptcy Case is dismissed or
converted to Chapter 7, the CTC Escrow shall be used pursuant to further
order of the Court.
b. Provide for the distribution of any cash proceeds attributable to the sale of
the Debtors assets still in the possession of the Debtor (which does not
include the CTC Escrow) (save and except only the Non-Party Assets) as
follows: (i) first, to Alpine Bank to the extent necessary to repay amounts
advanced by the Bank pursuant to, or otherwise due and owing with
respect to the DIP Loan, including interest, (ii) second, to Alpine Bank to
the extent necessary to satisfy Alpine Banks allowed secured claim, (iii)
third, the holder of the Wilhelm Claim to the extent necessary to satisfy
the Wilhelm Claim, (iv) fourth, to satisfy any remaining allowed and
unpaid administrative expense claims, if any, (v) fifth, to any Trade Claim
unsecured creditors to the extent not paid in full from the CTC Escrow,
and other unsecured creditors, including the members, pro rata according
to the gross amount of such allowed claims, to satisfy their allowed
unsecured claims for deposits, and (vi) the balance shall be paid to the
holder of equity interests in the Debtor. No distributions shall be made to
Rush or any affiliates of Rush on account of any alleged unsecured claim
for money loaned to the Debtor or obligations allegedly guaranteed by the
Debtor. Amounts, if any, alleged to be owed arising from the sale of any
Non-Party Asset shall be paid to the holder of the allowed claim related to
such Non-Party Asset.
c. Provide for the distribution of the CTC Escrow as provided in paragraph
2(a)(iii) of this Term Sheet.
d. Contain such other provisions as may be reasonably necessary or desirable
to implement this Term Sheet.
e. Not contain any provisions which are inconsistent with this Term Sheet or
with orders entered by the Bankruptcy Court approving the 9019 Motion
contemplated by this Term Sheet or with the sale process described in this
Term Sheet.
5. Miscellaneous Provisions.
a. Upon execution of this Term Sheet by all Parties, the Parties shall jointly
request the Bankruptcy Court to vacate the hearing on the Trustee Motion.
b. All pending discovery in the Bankruptcy Case related to the DIP Loan
Motion and the Trustee Motion shall immediately cease and the Parties
29

12

4266769.1
shall not initiate any new discovery in connection with those matters
without further order of the Bankruptcy Court.
c. All proceedings in the CTC Lawsuit shall immediately cease, except to the
extent necessary to advise the State Court in the CTC Lawsuit of the
pending settlement of that case and, upon payment of the CTC Settlement
Payment, to dismiss or otherwise conclude the CTC Lawsuit against all
parties thereto as provided herein.
d. This Term Sheet provides an overall framework for the resolution of
various disputes among the Parties. The Parties acknowledge that
additional documentation will be required to implement the Term Sheet,
which documentation may include a separate Settlement Agreement. The
Parties acknowledge that documents which will implement the Term Sheet
will contain other provisions but, under no circumstances, will such
additional documentation (including, without limitation, any Settlement
Agreement), change the provisions of the Term Sheet which provisions
will be binding on all Parties, subject only to approval of the Bankruptcy
Court and Eagle County District Court. The settlements and compromises
provided in this Term Sheet, other than with respect to the abatement of
discovery, are subject to approval of the Bankruptcy Court and the Eagle
County District Court. However, the parties agree that while the various
provisions of this Term Sheet are pending approval by the Bankruptcy and
Eagle County District Court, they shall cooperate and work together in
good faith to implement this Term Sheet.
e. This Term Sheet contemplates that certain rights of the Class Action
Lawsuit plaintiffs will be compromised. The Class Action Settlement is
subject to the approval of the Eagle County District Court in the Class
Action Lawsuit and shall not become effective unless and until so
approved. The Member Representatives agree to recommend such
approval by the Eagle County District Court. Member Representatives
further agree to disseminate, either by email or United States mail, a letter
to the class members to be included in the notice of settlement
recommending approval of the Class Action Settlement. Member
Representatives and any of the CTC Individuals and the CPOA
Individuals who are Class Members agree to not opt out of the partial
settlement of the Class Action Lawsuit. Upon approval of this settlement
by the Eagle County District Court and the Bankruptcy Court, any
objection by the Committee or the Debtor to use of proceeds from any
applicable insurance policy to defend the Class Action Lawsuit shall be
deemed withdrawn and consent to use of such proceeds to defend the
Class Action Lawsuit shall be deemed granted.
f. Upon approval of this settlement by the Eagle County District Court and
the Bankruptcy Court, Member Representatives shall promptly file a
29

13

4266769.1
Notice of Withdrawal of their Verified Motion for Issuance of Contempt
Citation as against the Debtor, WFP, and Wilhelm and shall not refile such
motion.
g. If and to the extent the Parties are unable to resolve among themselves any
issues that arise in connection with joint actions they are to take to
implement this Term Sheet, the Parties agree that the Mediator shall assist
them in resolving such issues.
h. At the hearing scheduled for September 17, 2012, the Parties shall advise
the Bankruptcy Court of and provide a copy of this Term Sheet to the
Bankruptcy Court and request that the Interim DIP Loan be extended as
provided above, and that the hearing on the DIP Loan Motion be
continued for a period of approximately ten (10) days.
i. Upon approval of the 9019 Motion, relief from stay shall be granted so
that the Class Action Lawsuit can proceed against the Debtor, with
recovery limited to any applicable insurance proceeds, as provided in this
Term Sheet.
j. No party admits liability as to any claims or defenses asserted in the Class
Action Lawsuit.
k. If any Wilhelm Party is selected as the successful bidder at the sale of the
Debtors assets as provided for herein, then if memberships are offered in
a club which utilizes any of those assets, then the memberships must be
offered to all past and present members of the Club on the same terms as
anyone else.

29
29
'
I
4266769.1
~ ~ - - - - - - - ~ ~ -
CORDILLERA GOLF HOLDINGS, LLC, a
Delaware limited liability company
BY: CGH Manager, LLC, a Delaware
limited liability company, its Manager
By:_-,-----,-, __ -=-:-::-:-'--:---------
David A. Wilhelm, Manager
CORDILLERA F&B, LLC, a
BY:---,--,---cc--,--------
Patrick D. Wilhelm, Manager
WFP CORDILLERA, LLC, a
limited liability company, its Manager
By: ____________ _
WFP INVESTMENTS, LLC, a
B Y : _ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ -
David A. Wilhelm, Company Manager
14
29
4266769.1
CORDILLERA GOLF CLUB, LLC, a
BY:_=--:-:-:--::::-:---:--=--::----
Daniel L. Fitchett, Jr., CEO
CORDILLERA GOLF HOLDINGS, LLC, a
ltmited HabilitY. company, its Man,,,_-
'
CORDILLERA F&B, LLC, a
1
/)
BY: ~ : ! : d W a ~ ~
flltriCk D. Wilhelm, Manager
WFP CORDILLERA, LLC, a
14
--
29
4266769:1
CGH MANAGER, LLC, a
Delaware linu e

navid A. Wilhelm, Manager
OFFICIAL COMMITTEE OF UNSECURED
CREDITORS

Dennis Meir, Chairman of the Committee
CHERYL M. FOLEY, individually
and as a Member Representative
THOMAS individually
JUNE WILNER, individually
CHARLES JACKSON, individually
15
29
CGH MANAGER, LLC, a
BY: __ -,--,-________ _
CREDITORS
DAVID A. WILHELM, an individual
PATRICK D. WILHELM, an individual
THOMAS WILNER, individually
JUNE WILNER, individually
15
Error! Unknown document property name.
29
Sep 23 12 11 :29a Cheryl Foley
4266769.l
9709262027
CGH MANAGER, LLC, a
BY:. ____________ _
CREDITORS
p.1
By: __ - : - ~ - : - - - : : - : - . , - - - - - : : - : , . - - - : : : - - - - - :
Dennis Meir, Chairnmn of the Committee
PATRICK D. WILHELM:, an individual
JANE WILNER, individually
15
29
CGH MANAGER, LLC, a
BY: ____________ _
CREDITORS
BY:---:=----:-.,-,-.,---,-,---,------:-:---:-----:-
Dennis Meir , Chairman of the Committee
and as a ber ~ v e
~ i F . } ~
OMAS WILNER, individually
15
29
4266769.1
CGH MANAGER, LLC, a
BY:
- - - - ~ - - - - ~ - - - - - - - - - - - - - - - -
OFFICIAL CO!vflvliTTEE OF UNSECURED
CREDITORS
BY: _____________ _
Dennis Meir , Chairman of the Committee
15
29
4266769.!
0 , individually
KEVIN B. ALLEN, individually
CORDILLERA TRANSITION CORPORATION,
INC.
BY:
-----------------------
CORDILLERA VALLEY CLUB PROPERTY
OWNERS ASSOCIATION, INC.
BY: ________________________ __
TIMBER SPRINGS PROPERTY OWNERS
ASSOCIATION, INC.
BY: ______________________ _
ALPINE BANK, a Colorado banking corporation
By: ______________ .:.._ ________ __
Name: ________________________ __
Title: __________________________ _
16
29
4266769.1
MARY JACKSON, individually
-tift'@_
KE IN B. ALL N-;ln!Jj.vitfually
a p ' ~ as a Member Representative
I
INC.
BY.:_-----------------------
BY: ______________________ __
ASSOCIATION, INC.
BY:
----------------------
By:: ______________________ _
Nrume:. ________________________ _
Title:. ________________________ __
I6
29
4260429.1
INC.
BY:
------------------------
ASSOCIATION, INC.
BY: ________________ _
CORDILLERA METRO PO LIT AN DISTRICT
BY: _________________ __
16
29
4266769.1
INC.
BY:
----------------------------
CORDILLERA Y ALLEY CLUB PROPERTY
BY:
-----------------------
T!NIBER SPRINGS PROPERTY OWNERS
ASSOCIATION, INC.
BY:
-----------------------

Title: 'fres/Jm-1 t
16
29
CORDILLERA PROPERTY OWNERS
INc-.:-//)

Lois Van Deusen, President
CORDILLERA METROPOLITAN DISTRICT

Nanette Kuich, Pre;ident

LOIS VANDEUSEN, a CPOA Individual

a CPOA Individual
_ s
GLENN BOURLAND, a CPOA Individual
17
29
4266769.1
CORDlLLERA TRANSITION CORPORATION,
INC.
R BERT VANOUREK, a CT.
A f:lct.'(h_do /1} 4-VYL-
DAVID TEMIN, a CTC Individual
SARAH BAKER, a CTC Individual
DAVID BENTLEY, a ere Individual
18
29
4266769.1
CORDILLERA TRANSITIONCORPORATION,
INC.
BY: ____________ _
Denise Delaney, President
DENISE DELANEY, a CTC Individual
RAYMOND OGLETHORPE, a CTC Individual
ROBERT V ANOUREK, a CTC Individual
GARY EDWARDS, a CTC Individual
S H BAKER, a CTC In iv1dual
NELSON SIMS, a CTC Individual
DICK ROTHKOPF, a CTC Individual
DAVID BENTLEY, a CTC Individual
18
29
4266769.1
INC.
By :_-:::--:--=-:------::-----c:-:-----
Denise Delaney, President
DENISE DELANEY, a CTC Individual
RAYMOND OGLETHORPE, a CTC Individual
ROBERT VANOUREK, a CTC Individual
GARY EDWARDS, a CTC Individual
SARAH BAKER, a CTC Individual
NELSON SIMS, a CTC Individual
DICK ROTHKOPF, a CTC Individual
IDBEN
18
4838-9404-7505.4
26
Exhibit 2
(Order Granting Joint Motion for Approval of Term Sheet and Authorization
to Implement Certain Matters Set Forth Therein)
4810-8655-9505.1

In re

Club at Cordillera,
Tax ID / EIN: 27-0331317

Debtor.

Chapter 11
ORDER GRANTING JOINT MOTION FOR APPROVAL OF TERM
SHEET AND AUTHORIZATION TO IMPLEMENT CERTAIN MATTERS
SET FORTH THEREIN

This matter comes before the Court on the Joint Motion for Approval of Term Sheet and
Authorization to Implement Certain Matters Set Forth Therein (the Joint Motion). The Court
having reviewed the Joint Motion, and finding that good cause exists for granting the relief
requested therein, and that no further notice of the Joint Motion is necessary or appropriate,
IT IS HEREBY ORDERED, ADJUDGED, AND DECREED THAT:
1. The Joint Motion is GRANTED, the Term Sheet is hereby approved, and the
Debtor is authorized to effectuate certain settlements and compromises as set
forth therein as follows:
2
4810-8655-9505.1

approval of same.

Term Sheet.


the Final DIP Loan;


3
4810-8655-9505.1
2. The Court hereby sets a hearing date for the approval of the joint disclosure
statement and plan of reorganization consistent with the terms of the Term Sheet,
without prejudice or in any way ruling on the ultimately confirmability of any
such plan, for _________________, 2012, at ______ __.m.

Dated this ______ day of _______________, 2012.
BY THE COURT:

_____________________________________
United States Bankruptcy Court

4810-8655-9505.1

In re

Club at Cordillera,
Tax ID / EIN: 27-0331317

Debtor.

Chapter 11
ORDER GRANTING JOINT MOTION FOR APPROVAL OF TERM
SHEET AND AUTHORIZATION TO IMPLEMENT CERTAIN MATTERS
SET FORTH THEREIN

This matter comes before the Court on the Joint Motion for Approval of Term Sheet and
Authorization to Implement Certain Matters Set Forth Therein (the Joint Motion). The Court
having reviewed the Joint Motion, and finding that good cause exists for granting the relief
requested therein, and that no further notice of the Joint Motion is necessary or appropriate,
IT IS HEREBY ORDERED, ADJUDGED, AND DECREED THAT:
1. The Joint Motion is GRANTED, the Term Sheet is hereby approved, and the
Debtor is authorized to effectuate certain settlements and compromises as set
forth therein as follows:
2
4810-8655-9505.1

approval of same.

Term Sheet.


the Final DIP Loan;


3
4810-8655-9505.1
2. The Court hereby sets a hearing date for the approval of the joint disclosure
statement and plan of reorganization consistent with the terms of the Term Sheet,
without prejudice or in any way ruling on the ultimately confirmability of any
such plan, for _________________, 2012, at ______ __.m.

Dated this ______ day of _______________, 2012.
BY THE COURT:

_____________________________________
United States Bankruptcy Court


Joint Motion For Approval of Term Sheet and Authorization To Implement Certain Matters Set Forth Therein

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