4851-2457-2176.

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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLORADO

In re:

CORDILLERA GOLF CLUB, LLC
d/b/a THE CLUB AT CORDILLERA,

Debtor.
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)
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Case No. 12-24882 ABC
Chapter 11


DEBTOR'S SUPPLEMENT TO: (1) APPLICATION FOR AN ORDER (I)
AUTHORIZING RETENTION OF GA KEEN REALTY ADVISORS, LLC AS REAL
ESTATE ADVISOR FOR THE DEBTOR AND DEBTOR IN POSSESSION NUNC PRO
TUNC TO THE PETITION DATE AND (II) WAIVING CERTAIN REQUIREMENTS
OF LOCAL RULE 2016-2, AND (2) APPLICATION FOR ORDER AUTHORIZING THE
RETENTION OF PRICEWATERHOUSECOOPERS LLP AS FINANCIAL ADVISOR
TO THE DEBTOR NUNC PRO TUNC TO THE PETITION DATE AND WAIVING
CERTAIN REQUIREMENTS PURSUANT TO LOCAL RULE 2016-2


1. Cordillera Golf Club, LLC dba The Club at Cordillera (the "Debtor"), hereby
submits this Supplement to the Application for an Order (I) Authorizing Retention of GA Keen
Realty Advisors, LLC as Real Estate Advisor for the Debtor and Debtor in Possession Nunc Pro
Tunc to the Petition Date and (II) Waiving Certain Requirements of Local Rule 2016-2, and (2)
Application for Order Authorizing the Retention of PricewaterhouseCoopers LLP as Financial
Advisor to the Debtor Nunc Pro Tunc to the Petition Date and Waiving Certain Requirements
Pursuant to Local Rule 2016-2 (collectively, the "Motions") to clarify and address questions
raised in the objections to the Motions filed by various parties-in-interest, and states as follows:
2. The Debtor's employment of PricewaterhouseCoopers LLC ("PwC") and GA
Keen Realty Advisors, LLC ("Keen") is warranted.
3. This case is unusual in the sense that the official unsecured creditors committee
appointed in this case (the "Committee") is comprised of a majority of persons who are actively
involved in litigation with the Debtor, litigation that the Debtor believes is neither asserted in
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good faith, nor grounded in fact or law. Such a circumstance will undoubtedly complicate the
provision of confidential information to the Committee's members themselves (as opposed to its
counsel only), and raises the specter of the possibility of the Committee posturing itself in this
case to secure a litigation advantage.
4. The Debtor believes that the economic value of the Club is far greater than the
total value of all provable creditors' claims against it. As a result, and as noted by Delaware
Bankruptcy Judge Sontchi in connection with the venue transfer motion:
"I think a liquidation, as I think of it, is unlikely in this case. We're either going to
have a reorganization of some or all of the business, or we're going to have
combination of sale of some or all of the assets on a going-concern basis."
[See Excerpt of Transcript of Judge Sontchi's ruling attached hereto as Exhibit A which is also
part of Docket Entry No. 193.]
5. Against the backdrop of demonstrating and proving-up its proposed rehabilitation,
the Debtor has sought the employment of PwC as its financial advisor and Keen as its real estate
advisor. The oppositions filed to the employment of one or both entities appear grounded in a
desire to force the Debtor into an immediate or forced liquidation, with the likely result of
reducing recovery to the unsecured creditors. The Debtor believes it can propose an economic
solution that will rehabilitate the Club, and which will be supported by a majority of its
members. The Debtor must retain the services of these advisors to deliver on that expectation
within its exclusivity period; and to deny the Debtor access to needed professional guidance
necessarily results in the forced liquidation that Judge Sontchi has already suggested can be
avoided.
6. PwC's services are not duplicative of Keen's services, and the objections focus on
a mistaken belief that PwC and Keen will have overlapping services.
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7. PwC is being retained as the Debtor's financial advisor for capital restructure
modeling and plan feasibility modeling and testimony. PwC is not engaged to make contact with
persons seeking on behalf of the Debtor equity or debt investments, nor to negotiate or structure
debt or equity investments. Rather, PwC, at the Debtor's request, will prepare the financial
models that will form the basis of the Debtor's plan of reorganization, to assist in demonstrating
the feasibility of the Debtor's proposed revised capital structure and plan, and will statistically
validate the Debtor's plan projections. PwC will not be substantially involved in the Debtor's
day-to-day accounting affairs, as the preparation of operating reports will be handled by the
Debtor's in-house controller.
8. Further, per its engagement, PwC will be compensated on an hourly basis. PwC
will submit detailed invoices, and its compensation will be pursuant to the compensation order.
This is acknowledged in PwC's engagement letter. [See Docket Entry No. 110, page 45.] To the
extent of any true duplication, the Court of course will maintain discretion over compensation to
PwC.
9. In contrast, Keen will actively prepare (and has already prepared) a proprietary
potential investment due diligence materials package (of which the PwC forecasts may become
one piece of that package); Keen will contact (and the evidence shows has already contacted
over 50) potential lenders or investors for the Debtor; Keen will negotiate (and the evidence
shows has already negotiated) NDAs for the purposes of soliciting potential investment in the
Debtor (the evidence shows Keen has already procured approximately 15 such NDAs); Keen
will negotiate (and the evidence shows has already negotiated) with respect to the Debtor's
financing commitment agreements (the evidence shows Keen has already procured four such
commitments); and as to one such commitment (Northlight/Southlight Trust I), Keen has assisted
in the due diligence that led to the Debtor's initial motion to approve post-petition financing
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Keen [Docket Entry No. 59] (at this juncture, in light of the interim loan proposed by Alpine
Bank, the Debtor has not refiled that motion). PwC was not materially involved in any of that
work, but only to the extent of input and preparation of proposed budgets.
10. With respect to any issue of PwC's use of "Independent Contractors," the Debtor
withdraws any request to permit PwC to utilize the services of any such Independent Contractor
without approval from the Court.
11. In contrast to PwC's services, Keen is acting primarily as the Debtor's investment
banker. In the event that the Debtor pursues a sale of any portion of its real estate (an event the
Debtor contemplates it can avoid with the correct strategic capital investment or joint venture
which the Debtor anticipates Keen can arrange), Keen will serve as the real estate broker for
such a transaction. There is no doubt -- based on its experience in other bankruptcy cases and its
already substantial work completed in this case since inception of the case -- Keen is the right
firm to assist the Debtor in realizing its reasonable, and manageable, goals.
12. The crux of the objection to employment of Keen turns on the proposed
"Minimum Transaction Fee." The Debtor submits that there is substantial justification for
provision of such a fee in this case and its approval under 11 U.S.C. 328(a). And the Debtor
submits that the employment of Keen on the basis requested is a proper exercise of the Debtor's
business judgment.
13. As is customary in the investment banking industry, investment bankers typically
require a substantial retainer and a substantial monthly stipend while representing the party
seeking financing. For an entity like the Debtor with an asset value of over $40,000,000, and an
enterprise value of over $100,000,000, a $100,000 retainer and a $50,000 monthly stipend would
not be unusual. Keen has received neither in this case.
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14. The Minimum Transaction Fee, only earned to the extent the percentage-based
fees provided are not earned over the 18-month duration of the engagement agreement, and
subject to offset by such other fees, is designed to give the Debtor access to first class investment
banking services at a much lower risk profile than a typical investment banking transaction. The
Debtor is neither required to pay a retainer nor monthly fees. Further, given the numerous carve-
outs in Keen's engagement from its percentage-based fee should the Debtor do a financing or
equity transaction with the carve-out parties (e.g. Alpine Bank or other creditor), the Minimum
Transaction Fee assures that Keen will provide the necessary services to the Debtor's estate
without undue risk to it that it will receive no compensation.
15. Under Keen's engagement, the payment of any percentage-based fee is tied to the
actual closing of a transaction. [See Keen Engagement Letter, Docket Entry No. 111, page 33,
C.1.] Second, the Minimum Transaction Fee is only due at the end of the "Term;" and Keen
does not otherwise earn such minimum amount unless it has performed it obligations under its
engagement. [See Keen Engagement Letter, Docket Entry No. 111, page 35, 3.] The objection
that Keen could be paid its minimum fee for "doing nothing" is hyperbole. The factual record
developed in the case prior to the transfer of venue from Delaware clearly establishes that Keen
has already provided substantial services to the Debtor to date. The risk that Keen will "do
nothing" rings hollow when compared to what the admitted evidence shows Keen has already
done.
16. Offsetting against the Minimum Transaction Fee is the amount of percentage-
based fees for debt or equity investments secured or sales which are approved by the Court and
are closed. The Minimum Transaction Fee is designed to compensate Keen for being the
Debtor's investment banker, and to compensate Keen in the event of a financing event for which
Keen otherwise would not be paid. As set forth above and in more detail in its engagement
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letter, there are numerous "carve-outs" to the Keen engagement agreement, and there may be
other carve-outs determined by the Court at a later date. For example, on July 26, 2012, the
Court approved a nearly $600,000 interim financing between the Debtor and Alpine Bank -- and,
under the Keen agreement, Keen is not entitled to any percentage-based compensation based
upon any financing extended to the Debtor by Alpine Bank. Yet, until Keen procured a DIP
lender for the Debtor -- Northlight/Southlight Trust I -- Alpine Bank had been unwilling to lend
to the Debtor. Although not completely quantifiable, there is little doubt that the existence of a
potential DIP priming loan arranged by Keen and put before this Court had an impact upon the
Debtor's ability to secure financing from Alpine, a financing as to which Keen is entitled to no
percentage compensation. Further, to the extent that Keen earns percentage compensation during
the 18-month engagement term that exceeds the Minimum Transaction Fee, the Minimum
Transaction Fee is irrelevant. For example, by procuring aggregate senior debt that equals
approximately $20,000,000 (i.e. senior debt approximately equal to the existing real property
secured debt), Keen will have earned percentage compensation that exceeds the Minimum
Transaction Fee. If Keen were to raise $6,000,000 in equity -- an amount much less than the
Debtor's projected equity in its real estate -- on closing, the percentage fee earned would exceed
the Minimum Transaction Fee. Likewise, a sale of any one of the Debtor's golf courses, if
necessary or appropriate, at a sale of $10,000,000 obliterates the Minimum Transaction Fee.
17. Lastly, in light of applicable law and the requirements in the engagement
agreement regarding approval of its fees, the Court clearly retains oversight over any fees paid to
Keen. 11 U.S.C. 328(a). [Also see Keen Engagement Letter, Docket Entry No. 111, page 37,
E.]
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18. The exercise of the Debtor's business judgment, the Debtor's rehabilitation and
reorganization efforts -- and its strong belief that it can avoid liquidation if provided access to the
capital markets through Keen -- supports employment of PwC and Keen as requested.
Wherefore the Debtor respectively requests approval of the Motions.
Dated: July 27, 2012


SENDER & WASSERMAN, P.C.

/s/ David V. Wadsworth

Harvey Sender, #7546
David V. Wadsworth, #32066
1660 Lincoln Street, Suite 2200
Denver, CO 80264
Telephone: 303-296-1999
Facsimile: 303-296-7600
Email: dvw@sendwass.com
Counsel for the Debtor and Debtor-in-Possession

and

FOLEY & LARDNER LLP
Christopher Celentino (CA No. 131688)
Mikel Bistrow (CA No. 102978)
Dawn A. Messick (CA No. 236941)
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

Proposed Counsel for Debtor and Debtor in Possession


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4851-2457-2176.1
EXHIBIT "A"

Excerpt of Transcript of Judge Sontchi's Ruling


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UNITED STATES BANKRUPTCY COURT
DISTRICT Or DELAWARE
3 IN RE: Case No. 12-11893 (CSS)
Chapter 11
4 CORDILLERA GOLF CLUB, LLC,
Dba The c .lub at Cordillera,
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ll
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l.S
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Debtor.
Courtroom No. 6
824 Market Street
Wilmington, DE 19801
July 16, 2012
10:00 A.M.
TRANSCRIPT or. HEARI NG
.BEFORE HONORABLE CHRI STOPHER S. SONTCHI
UNITED STATES BANKRUPTCY JUDGE
APPEARANCES:
For the Deb'tor:
ECRO:
Transcription Service:
Young Conaway Starqatt & Tayl or
By: JOSEPH BARRY, ESQUIRE
1000 west Street, 17th Floor
Wilmington, Delaware 19899
(302) 571-6600
Foley & LLP
By: CHRISTOPHER CELENTINO, ESQUIRE
402 West Broadway, Suite 2100
San D.iego, California 92101
(619) 234-6655
LESLIE MURIN
Roliabl e
1007 N. orange
Wi l mingt on, Delaware 19801
Tel ephone: (302) 6.54-8080
21 E-Mail: Qroatthews@ reliable-co . com
22 Proceedings recorded by electronic sound recording:
transcript prodo.ced by t.rlmScriptidn service.
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I would favot =oving the case to Colorado. And they' re
l strong factors, and important.
3 There aro quit. a nuznber, howevr. whlch 3<0
4 either neutral or favor keeping it he-re. And if it's
5 neutxal, i t favors keeping it here because you haven' t met
6 the on that
1 ! think liqui dation, as t think of it, is
6 unlikely in thls case. We're either 9olng have a
9 reorganization of some or a lL of the oc go:ng
lU to nave com.olnation of sale of so:ne or all ot the a$Sets on u
11 going-concern bas is.
12 An orcer 363 sale really is not a l i quidation in my
13 mind. Whet her it to a cont1rmed plan o!
14 x-corQ:an1zat1on ot not is another thing. But -..ben people
15 think liquida tion, when 1 think liqu.idation, l think fire
16 liquidation. 1 think puttinq the assets, not JS the $Um
1? of their parts , but by out for sale, and see
1a h11ppen:s . lt's like stripping down a factory or soi ling oft
19 - auct i oning off leases, something lik& t hat, as rnore of a
20 liquidation .
21 I don' t soe this c ases headed to liquidation. The
22 onderJ.yinc;; improvements on the -- on t he prope ny ace simply
23 too valuable to b6 run as anything else . There arc
24 restrictions on whether they can be carved up and
25 turned i nto further homes . There ' s -- obviously, in a