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In re:

IN THE UNITED STATES BANKRUPTCY COURT


FOR THE DISTRICT OF DELAWARE
Chapter 11
Cordillera Golf Club, LLC,
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dba The Club at Cordillera,
Case No. 12-11893 (CSS)
Ref. Docket No. 9
Debtor.
INTERIM ORDER
(A) AUTHORIZING DEBTOR'S USE OF CASH COLLATERAL,
(B) GRANTING ADEQUATE PROTECTION, AND
(C) SCHEDULING FINAL HEARING
PURSUANT TO BANKRUPTCY RULE 4001
Upon the motion (the "Motion")ofthe above-referenced debtor, as debtor-in-
possession (the "Debtor"), seeking this Court's authorization pursuant to Sections 105, 361, 362
and 363 of the United States Bankruptcy Code, 11 U.S.C. 101 et ~ . ( t h e "Bankruptcy
Code"), and Rules 2002, 4001 and 9014 of the Federal Rules of Bankruptcy Procedure (the
"Bankruptcy Rules"), for the Debtor to use cash collateral, as such term is defined in Section 363
of the Bankruptcy Code ("Cash Collateral"), solely in accordance with the terms of this order(the
"Interim Order"), upon which the Lenders have asserted perfected security interests and liens;
and a hearing (the "Interim Hearing") having been held by the Court on June 27, 2012 to
consider the relief sought in the Motion; and pursuant to Bankruptcy Rule 400 1, due and
sufficient notice of the Motion and the relief sought at the Interim Hearing having been given by
the Debtor to the Office of the United States Trustee, the United States Securities and Exchange
Commission, the Office of the United States Attorney for the District of Delaware, the Internal
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The Debtor in this chapter 11 case, and the last four digits of its employer tax identification number, is:
XX- XXX 1317. The corporate headquarters address for the Debtor is 97 Main Street, Suite E202,
Edwards, CO 81632.
Revenue Service, the Debtor's twenty (20) largest unsecured creditors and counsel to the
Lenders; and the Court having considered the offers of proof, evidence adduced, objections
asserted and the statements of counsel at the Interim Hearing; and it appearing to the Court that
granting the relief sought in the Motion on the terms and conditions herein contained is fair and
reasonable and that entry of this Interim Order is in the best interest of the Debtor and its estate
and creditors; and due deliberation and good cause has been shown to grant the relief sought in
the Motion as modified herein:
NOW, THEREFORE,
A. Capitalized terms used, but not defined herein shall have the
meaning set forth in the Motion.
B. On June 26, 2012 ("Petition Date"), the Debtor filed a voluntary
petition for relief under Chapter 11 ofthe Bankruptcy Code in this case (the "Case"),
and it has continued with the management and operation of its businesses and
properties as a debtor-in-possession pursuant to Sections 1107 and 1108 of the
Bankruptcy Code.
C. The Debtor asserts that, according to its books and records, as of
the Petition Date, the aggregate principal amounts outstanding on the Alpine Loan
and the Wilhelm Loan were approximately $12.7 million and $7.5 million,
respectively. Each of the Lenders asserts a security interest in, among other things,
Cash Collateral to secure their respective Loans.
The Debtor asserts that the appraised value of the Real Property, in the aggregate, is $33,000,000
based upon the appraisal of Chrysalis Valuation Consultants LLC dated June 5, 2012 (the
"Chrysalis Appraisal"). Neither Alpine nor Wilhelm stipulate to the Debtor's assertion in this
regard, nor is the Court entering any findings with respect to such assertion by the Debtor.
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D. The Debtor has requested immediate entry of this Interim Order
pursuant to Bankruptcy Rule 4001 (b )(2) to meet expenses associated with the
management of the Club, the Course, the Facilities and the Real Property including,
without limitation, payroll, taxes, general maintenance costs and administrative
expenses.
E. Notice of the requested relief sought at the Interim Hearing was
provided by the Debtor to: (a) the Office of the United States Trustee; (b) the
Lenders; and (c) the Debtor's twenty (20) largest unsecured creditors. Given the
nature of the relief sought the Court concludes that sufficient and adequate notice of
the Interim Hearing has been given pursuant to Bankruptcy Rules 2002, 4001 (b) and
(d) and 9014 and Section 102(1) ofthe Bankruptcy Code as required by Sections 361
and 363 of the Bankruptcy Code, and that, given the exigent circumstances presented
by the Motion, no further notice of, or hearing on, the relief sought at the Interim
Hearing and the relief granted herein is necessary or required.
F. Consideration of the Motion constitutes a "core-proceeding" as
defined in28 U.S.C. 157(b)(2)(A), (B), (D), (M) and (0). This Court has
jurisdiction over this proceeding and the parties and property affected hereby
pursuant to 28 U.S.C. 157 and 1334 and the Amended Standing Order of
Reference from the United States District Court for the District of Delaware dated as
of February 29, 2012.
G. Under the circumstances, good, adequate and sufficient cause has
been shown to justify entry of this Interim Order. Among other things, granting the
relief set forth in this Interim Order will permit the Debtor to meet its expenses.
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H. The Lenders have consented to the Debtor's use of Cash Collateral
on an interim basis on the terms and conditions hereinafter set forth.
NOW, THEREFORE, UPON THE RECORD OF THE PROCEEDINGS
HERETOFORE HELD BEFORE THIS COURT WITH RESPECT TO THE MOTION,
THE EVIDENCE ADDUCED AT THE INTERIM HEARING, AND THE STATEMENTS
OF COUNSEL THEREAT, IT IS HEREBY ORDERED THAT:
1. Subject to the terms and conditions of this Interim Order, the Court hereby
authorizes the Debtor's use during the period (the "Budget Period") beginning on the Petition
Date and ending on the Expiration Date (as defined below in paragraph 5) of purported Cash
Collateral for the disbursements set forth in the budget which is attached as Exhibit A hereto (the
"Budget"), or in such greater amounts as Lenders may authorize and consent to from time to
time. The expenditures authorized in the Budget shall include a 10% variance for each
individual line item within the Budget Period (the "Budget Variance").
2. During the interim period between the Petition Date and the final hearing
on the Motion, the Debtor shall be authorized to make the expenditures set forth in the Budget,
subject to the Budget Variance, and to provide the adequate protection to the Lenders hereinafter
set forth; provided, however, that (a) nothing in this Interim Order shall constitute a
determination by the Court regarding (i) the extent, if any, to which any asset of the Debtor may
constitute "cash collateral" (as defined in section 363 of the Bankruptcy Code), (ii) the
entitlement of any party to receive any form of adequate protection on a final basis or the
adequacy of any such protection offered or proposed by the Debtor, (iii) the value of the Real
Property or any other asset of the Debtor, or (iv) whether there exists any or sufficient equity
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cushion in relation to the Lenders' secured claims, and (b) the rights of all parties with respect to
the foregoing matters set forth in clause (a) hereof are expressly reserved.
3. As adequate protection for, and to secure payment of, an amount equal to
the aggregate diminution in the value of the purported Cash Collateral from the Petition Date as a
result of the use thereof, the Debtor hereby grants to Alpine the following adequate protection:
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a. A security interest in and lien upon (the "Alpine Replacement
Lien"), all of the Debtor's now existing or hereafter acquired
property of the same type as the Alpine Collateral, but specifically
excluding avoidable transfer claims and recoveries and/or similar
claims and recoveries pursuant to Sections 542 through 550, of the
Bankruptcy Code. The Alpine Replacement Lien shall have the
same validity and priority as Alpine's lien on the Alpine Collateral
existing on the Petition Date.
b. To the extent that the Alpine Replacement Lien proves insufficient
to provide Alpine with adequate protection, an allowed
superpriority administrative claim, pursuant to Bankruptcy Code
section 507(b ), having priority over all other administrative claims
(the "Alpine Administrative Claim").
c. The Alpine Replacement Liens shall be deemed valid, binding,
enforceable, and perfected without the need for the recording of
UCC financing statements or any other recordation or additional
action by Alpine.
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4. As adequate protection for, and to secure payment of, in an amount equal
to the aggregate diminution in the value of the purported Cash Collateral from the Petition Date
as a result of the use thereof, the Debtor hereby grants to Wilhelm the following adequate
protection:
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a. A security interest in and lien upon (the "Wilhelm Replacement
Lien"), all of the Debtor's now existing or hereafter acquired
property of the same type as the Wilhelm Collateral, but
specifically excluding avoidable transfer claims and recoveries
and/or similar claims and recoveries pursuant to Sections 542
through 550, ofthe Bankruptcy Code. The Wilhelm Replacement
Lien shall have the same validity and priority as Wilhelm's lien on
the Wilhelm Collateral existing on the Petition Date.
b. To the extent that the Wilhelm Replacement Lien proves
insufficient to provide Wilhelm with adequate protection, an
allowed superpriority administrative claim, pursuant to Bankruptcy
Code section 507(b ), having priority over all other administrative
claims except the Alpine Administrative Claim, as to which it shall
have the same priority as the Lenders' respective interests in the
Collateral.
c. The Wilhelm Replacement Liens shall be deemed valid, binding,
enforceable, and perfected without the need for the recording of
UCC financing statements or any other recordation or additional
action by Wilhelm.
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5. The rights of all parties in interest are hereby reserved with respect to the
Final Hearing, including, without limitation, with respect to the matters identified in paragraph 2
hereof, and otherwise with respect to this proceeding, except as expressly set forth herein.
Without limiting the generality of the foregoing:
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a. The Debtor may assert that any property is not subject to Lenders'
asserted liens and any property may be used by the Debtor and its
estate in the operation of its business and the administration of the
case. Further, the Debtor, as well as any creditor's committee
appointed in the Debtor's case or other creditors or parties-in-
interest as may have standing under applicable law, reserve their
rights to dispute that Lenders (or either of them) hold a valid,
enforceable, perfected and/or unavoidable security interest in
and/or liens upon the Cash Collateral or other Collateral or
property, including the Real Property and/or the Personal Property,
as well as any Cash Collateral derived from Debtor's business
operations which is subject to the security agreements between
Lenders and the Debtor; and nothing in the Motion or this Interim
Order shall act to confirm, acknowledge or ratify the validity,
perfection or amount of either Lender's pre-petition lien on any
Collateral or other property, or either Lender's debt or claims, nor
act as a waiver of the right of the Debtor to seek an order of this
Court imposing additional security interests or liens on any
Collateral or other property, whether senior or junior to Lenders'
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liens, nor act as a waiver of any claims against Lenders, a waiver
of rights under 11 U.S.C. 506(c), a "rollover" of pre-petition debt
of Lenders to post-petition debt, the granting of relief from the
automatic stay, nor to operate to divest the Debtor of any discretion
in the formulation of a plan or administration of the estate or limit
access to the Court to seek any relief under applicable provisions
of law, including without limitation, with respect to the treatment
of claims.
b. Nothing in this Order shall limit or affect the right of either Lender
to oppose on any available grounds any other or further use of
Cash Collateral other than as set forth in this Interim Order, any
attempt by the Debtor to place additional liens or security interests
on any of the Collateral, or any other relief or order of this Court
sought by the Debtor, including, without limitation, on the basis
that the interests of such Lender are not being adequately
protected. Further, nothing in this Order shall limit or affect the
right of either Lender to seek relief from the automatic stay or such
other relief in this proceeding as such Lender shall deem necessary
or appropriate, including, without limitation, a transfer of venue of
this proceeding to the District of Colorado, or to otherwise take
such position on any matter raised in this proceeding as such
Lender shall elect.
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6. During the Budget Period, The Debtor shall provide to Alpine Bank, by
and through counsel, within three (3) days following the end of each week, a report of all income
received by the Debtor and all expenses paid by the Debtor during such week, formatted in line
item form in a manner consistent with the Budget, and including a comparison of such actual
results as against the Budget's projections.
7. The Debtor's authorization to use purported Cash Collateral pursuant to
this Interim Order shall terminate on the earliest to occur of (each such occurrence being
hereinafter referred to as a "Termination Event"):(a) July 27, 2012 (the "Expiration Date");
(b) the dismissal of the Case or the conversion of the Case to a case under Chapter 7 of the
Bankruptcy Code; (c) the appointment or election of a trustee, examiner with expanded powers
or any other representative with expanded powers; (d) the Debtor's deviation from any line item
of the Budget by more than the Budget Variance during the Budget Period without the express
consent of Alpine; (e) the occurrence of the effective date or consummation date of a plan of
reorganization for the Debtor; (f) the entry of an order of this Court reversing, staying, vacating
or otherwise modifying in any material respect the terms of this Interim Order; (g) the entry of a
final order approving a superseding stipulation entered into by and between the Debtor and
Lenders; or (h) the entry of a final order by this Court governing the use ofthe Cash Collateral.
On and after the occurrence of a Termination Event specified in the Clauses (a) through (f)
above, the Debtor shall cease using purported Cash Collateral, absent the written consent of any
party claiming an interest in such Cash Collateral or further order of this Court.
8. The Debtor is authorized and directed to perform all acts and to make,
execute and deliver any and all instruments as may be reasonably necessary to implement the
terms and conditions of this Interim Order and the transactions contemplated hereby.
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9. The provisions of this Interim Order shall be binding upon any trustee
appointed during this Case or upon a conversion to a Case under Chapter 7 of the Bankruptcy
Code, and any actions taken pursuant hereto shall survive entry of any order which may be
entered converting the Case to a Chapter 7 case, or dismissing the Case, or any order which may
be entered confirming or consummating any plan(s) of reorganization.
10. The terms ofthis Interim Order shall be valid and binding upon the
Debtor, all creditors of the Debtor and all other parties in interest from and after the entry of this
Interim Order by this Court. In the event this Court stays, modifies or vacates any of the
provisions of this Interim Order following any further hearing, such modifications, stays or
vacation shall not affect the rights of the Lenders granted pursuant to this Interim Order.
11. Notwithstanding any such stay, modification or vacation, any
indebtedness, obligation or liability incurred by the Debtor pursuant to this Interim Order arising
prior to the Lenders' receipt of notice of the effective date of such stay, modification or vacation
shall be governed in all respects by the original provision of this Interim Order, and the Lenders
shall continue to be entitled to all of the rights, remedies, privileges and benefits, authorized
herein, with respect to all such indebtedness, obligation or liability, and the validity of any
payments made or obligations owed or credit extended pursuant to this Interim Order is and shall
remain subject to the protection afforded under the Bankruptcy Court.
12. The Final Hearing on the Motion is scheduled for July 27, 2012 at 1:00
p.m. (ET) before this Court (the "Final Hearing").
13. The Debtor shall promptly mail copies of this Interim Order to the parties
having been given notice of the Interim Hearing and to any other party which has filed a request
for notices with this Court. Any party in interest objecting to the relief sought at the Final
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Hearing shall serve and file written objections by no later than July 20, 2012 at 4:00p.m. (ET)
which objections shall be served so as to be received on such date, upon (i) Young, Conaway
Stargatt & Taylor, LLP, 1000 North King Street, Wilmington, Delaware 19889-0391, Attention:
Joseph M. Barry, and, Foley & Lardner LLP, 402 W. Broadway, Suite 2100, San Diego,
California 92101, Attn: Christopher Celentino, Proposed Attorneys for the Debtor, (ii) counsel
for the Lenders, (iii) counsel to any statutory committees appointed in these cases, and (iv) the
Office of the United States Trustee for the District of Delaware, 844 King Street, Suite2207,
Wilmington, Delaware 19801, Attention: Mark Kenney.
1 1). This Interim Order shall constitute findings of fact and conclusions of law
and shall take effect and be fully enforceable immediately upon
Dated: Wilmington, Delaware
June2,2012
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