Bankruptcy Changes Tesoro Club Membership Program
New owners of The Tesoro Club present their proposed new membership plan to members. Changes must be approved by bankruptcy court.
Palm Coast, Florida – April 19, 2009 – West Coast Investors LLC recently acquired the assets of The Tesoro Club from the Ginn Bankruptcy. A recent communication to members lays out the new owner’s plans to change the membership documents. The impact of the new changes on present members is significant and underscores the extent to which bankruptcy can alter the playing field.
Highlights of the proposed membership plan include:
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Any deposit monies previously paid to Ginn by members is lost, since they paid the money to Ginn, not the new owners.
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New members will pay a non-refundable deposit. Existing members in good standing will be allowed to continue their membership without paying the New Member deposit.
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Existing members who are delinquent in dues payments are required to bring their account current to resume "good standing."
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Recallable memberships will be available to non-property owners.
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Members will have reciprocal privileges at Palm Beach Polo and Country Club as well as Martin Downs Country Club.
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In order to receive the benefit of the new membership, without the payment of an initiation fee, the member must first inform the Bankruptcy Court that they are in favor of the revised membership plan and amendments to the declarations as proposed. Secondly, they must sign a contract obligating a subsequent purchaser of their home to a mandatory Club social membership. This covenant will run with the land. Once the bankruptcy court has approved the amended plan, the new membership program will become effective.
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Any reference to the Beach Club or a third golf course are removed from the documents.
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The entire communication is reproduced below
April 16, 2009
Dear Tesoro Member,
This e-mail is intended to bring you up to date since West Coast Investors LLC, acquired The Tesoro Club from the Ginn Bankruptcy on April 1, 2009. We are sure you have many questions. The following is a discussion of revisions that will be proposed to our membership plan. These will not be binding until formally presented to the Bankruptcy Court and approved by it. I am circulating the proposal in an attempt to see that you are properly informed as to what is happening.
I am sure you might have some questions and I would ask that if you do, please submit them to me in writing by e-mail and we will get all answers back to you by Tuesday, April 21, 2009. We are pleased with the proposed plan, while it can’t satisfy everyone; we believe it is fair and should substantially increase our member participation at the Club. For Tesoro to be a successful Community, TheClub must be successful.
And now the plan:
THE RE-STRUCTURE OF THE TESORO CLUB
MEMBERSHIP PROGRAM
BY
WEST COAST INVESTORS, LLC
West Coast Investors, LLC (“WCI”) has purchased through the Bankruptcy Court, certain assets of The Tesoro Club. It now proposes revisions to the Tesoro Membership Program which will be subject to the further approval of legal counsel and the Bankruptcy Court. The new Club Documents will remove any representations as to a Beach Club or third golf course. The revised documents will also provide that there can be as many as 400 golf members per 18 holes. There will also be a provision that the Club may close one course from time to time for maintenance or based on seasonal demand. The revised Club Documents will create a right to use Club and all business decisions of the Club are vested in management and not the membership.
REFUNDABLE MEMBERSHIP DEPOSITS
The Club Membership Program will be revised from a refundable deposit program to a right to use program which will, subject to the provisions set forth below addressing the membership rights of existing Club Members, require new members to pay a onetime non-refundable initiation fee. These revisions will terminate any obligation of the Club to refund deposits already paid by the members to the Club. Also, WCI will not impose a requirement for members to pay any remaining membership deposit balance which was due to the Club in order to participate in the new membership program. WCI did not receive the membership deposits previously paid to the Ginn Companies and will have no obligation to re-pay this financial obligation.
MEMBERSHIP RIGHTS OF EXISTING CLUB MEMBERS
All members of The Tesoro Club who currently own property at Tesoro and are in good standing will be offered a membership in the Club at no additional initiation fee, if they choose to continue as a member. In order to receive the benefit of this new membership, without the payment of an initiation fee, the member must first inform the Bankruptcy Court that they are in favor of the revised membership plan and amendments to the declarations as proposed. Secondly, they must sign a contract obligating a subsequent purchaser of their home to a mandatory Club social membership. This covenant will run with the land. Once the bankruptcy court has approved the amended plan, the new membership program will become effective.
A member in good standing is defined as a member who is current in the payment of club dues and fees. This does NOT include the payment of the second half of any membership deposit obligations. All membership deposit obligations previously paid by the members to the Club, will not transfer or be assumed under this plan.
A member who is in arrears with regard to their dues or fees owed to the Club can also participate in this plan and retain a membership, if they bring all prior obligations to the Club current (excluding deposit obligations) or in the alternative pay a reinstatement fee of $12,500.00 to the Club, whichever is less. A suspended Member of the Tesoro Club who is not in good standing will have 60 days to become current, or pay to reactivate their membership. After this 60 day grace period, in order to become a member, all prospective Resident Golf Members will be required to pay the Club an initiation fee, which is currently set at $25,000. .
RESIDENT GOLF MEMBERSHIPS
The Resident Golf Membership will be non equity and non deposit. Only property owners at Tesoro can become a Resident Golf Member. Resident Golf Membership will terminate at the death of the member, when the member is no longer a property owner at Tesoro or for cause as defined in the membership agreement and Club documents.
Annual dues will be $10,500.00, plus applicable sales tax for a Family Resident Golf Membership. All annual dues will become due and payable on January 1st of each year except for the remainder of 2009. Dues will be pro-rated for the remaining portion of 2009 and the amount of $7,875.00 shall be due and payable on the later of the approval of the Bankruptcy Court or May1, 2009.
Single Resident Golf Memberships are also available for $8,000.00 a year, plus applicable sales tax. Dues will also be pro-rated for 2009. To qualify for a single Resident Golf Membership the member must be unmarried, divorced or widowed.
Annual trail fees for those members who own their own cart will be $1,550.00 per year and will be pro-rated for 2009. If a member has already paid a trail fee for 2009, that payment will be honored.
Resident Golf Members will have priority tee times over all other classes of memberships. Golf members of the Club will have reciprocal golf privileges at Palm Beach Polo and Country Club as well as Martin Downs Country Club provided space is available. Resident members of each Club will always have priority over non residents. For Golf Members there will be a $35.00 reciprocal fee charged by the hosting club which includes the cart fee. If a non member is part of the group, the reciprocal fee will be the standard guest fee charged by the host club. There will also be reciprocal tennis, swimming and dining if space is available at no additional cost.
RESIDENT SOCIAL MEMBERSHIPS
The Club will offer Social memberships to all Tesoro Preserve residents as well as residents of Tesoro who are not required to be golf members. Dues for a Resident Social Membership are $4,800.00 per year, or $400.00 per month, plus applicable sales tax. For residents of Tesoro and Tesoro Preserve who are social members, this membership will have no initiation fee. This membership will entitle the member to the use of the tennis, swim and fitness facilities as well as dining privileges at the Club. A Social member will be entitled to four rounds of golf per year at a cost of $65.00 including the cart. A Social member will also be limited to a cumulative four rounds as a guest of any Resident Golf Member(s) between the months of October to May. In the months of May-September a Social member may play golf for a fee of $50.00 per round including cart provided space is available. Golf members will always be given first priority for tee times over Social Members.
All annual dues will become due and payable on January 1st of each year except for the remainder of 2009. Dues will be pro-rated for the remaining portion of 2009 and the amount of $3.600.00 shall be due and payable on the later of the approval of the Bankruptcy Court or May1, 2009. Resident Social Members of the Club will have reciprocal swim, tennis and dining privileges at Palm Beach Polo and Country Club and well as Martin Downs Country Club provided space is available.
For the next sixty (60) days any existing Resident Social Member may upgrade his or her membership to a Resident Golf Membership upon the payment of an upgrade fee of $12,500.00, plus applicable golf membership dues.
RECALLABLE GOLF MEMBERSHIPS
The Club will also offer Recallable Family Golf Memberships to non residents for $11,000.00 a year, payable in advance. There will be no initiation fee with this membership. This class of membership may be terminated at any time by the Club at the end of any year. There will be an Annual Recallable Single Golf Membership also offered at a cost of $9,500.00 a year, payable in advance
RECALLABLE SOCIAL MEMBERSHIPS
Recallable Social Memberships will also be made available to non-residents on an annual basis for $5,400 a year, payable in advance.
CONCLUSION
We believe that the membership programs set forth above will better align the Club with the current economic realities. This membership program will also benefit those seeking to sell real estate within Tesoro by implementing a lower cost of entry into the Club. West Coast Investors, LLC does reserve the right to make adjustments to this membership program at any time, so long as such adjustment does adversely impact the membership rights of existing members.
Sincerely,
Jackie Kennedy
Director of Membership
The Tesoro Club
All the pieces,some good some beyond repair
When Humpty Dumpty,Ginn falls he hits hard. The buyers are using the court that Ginn filed with to resolve their potential lawsuites. The money paid to Ginn, by the existing members, lives on, as it should, but the new deed restrictions are not legal, unless they don’t object. That’s because there was an actual taking of property rights by removing the origional Ginn fees and right as exclusive for owners. They could get a monetary award if they push the issue with the judge.
They never learn
Don’t these people know that mandatory will never fly. Someone will sue and they will win.