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RM.com's picture
Joined: 06/19/2007
Posts: 27726
Carol Ward criticizes club handling of sale

We received this letter today with the request that it be posted on behalf of Carol Anderson Ward, owner of the Murieta Equestrian Center and an owner of Country Club land and the North property being developed.

March 24, 2016

Re: Sale of Country Club

Dear Rancho Murieta Country Club Member:

Although there is a lot of information being distributed about the potential sale of the Country Club, much of the information is misinformation.  The Rancho Murieta Country Club (RMCC) Board of Directors acted on or before February 10, 2016 to enter into a deal with Bellagio Road LLC. Much has been said about this entity and its proprietor Bob Husband.  Much of the information describes a financially strong and superior golf management company.  However, Bellagio Road as of March 22, 2016 is a suspended limited liability company and not authorized to conduct business in California. (See attached printout from the California Secretary of State).  As such, any agreement with Bellagio is suspect and currently unenforceable. Clearly, the Board of Directors did not conduct basic due diligence with who it seeks to own and operate the Country Club.

The Board of Directors acted inconsistently with its fiduciary obligations to the membership by putting the cart before the horse when it entered into a transaction first, and then sought membership approval to go forward with the purchase option.  Further, the board did not make an honest evaluation of the cost to exercise the option before entering into any deal with Bellagio Road.

Under the terms of the lease option, RMCC is liable for the costs of appraisal and the arbitration if the parties cannot agree on a reasonable purchase price.  Despite the RMCC Board knowing that the RMCC property is valued by the County Assessor at $8.4 million and the appraised value of the club is in excess of $8 million, the board is claiming the property to be worth more than $2.3 million (based on the MOU). By starting the process in a clear low ball fashion, the Board has set up RMCC to lose. Bellagio Road is not required to pay in excess of $2.3 million if the arbitration determines the value to be in excess of $2.3 million.  If the arbitrators find the value to be close to the value as appraised, RMCC could lose over $100,000 in appraisal fees and not be able to exercise the purchase option.

Sincerely,

Carol Ward
Individual Golf Member

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Richard Robinson's picture
Joined: 08/10/2007
Posts: 108
Ms. Wards letter says there is an attachment?

Yet no attachment was posted? The above letter is signed as an mere "golf member", I doubt that Ms. Ward can separate her interest as a Investor (buyer) and her membership in the club??

Richard Robinson

 

RM.com's picture
Joined: 06/19/2007
Posts: 27726
No attachment attached

The letter says there is, but there wasn't an attachment. 

RM.com's picture
Joined: 06/19/2007
Posts: 27726
Country Club responds to Ward's letter

Thursday evening, Vince Lepera, president of the Country Club board, responded to Carol Anderson Ward's letter:

As the President of RMCC, I am responding to the post put up late this afternoon by Ms. Carol Ward (Shareholder of Murieta Club Properties who owns the golf course land and over 700 acres of land inside and around Rancho Murieta).  Normally I would not respond to an open post as I just don’t know for sure if this actually came from her but because the sale of the club is too important to ignore, I believe it’s important to provide facts.  This is especially true given our RMCC members are voting now on whether RMCC should purchase the club.

First of all, I have a great deal of respect for Ms. Ward, her vision for the community and the support she has provided over the years to RMCC and the community.  Unfortunately, her post seems to be an effort to dissuade RMCC members from voting in favor of the proposed purchase by disseminating information that is false and misleading.

First, she asserts that the Bellagio Road LLC that Bob Husband is affiliated with and (which was not formed until the end of 2015 as a boutique golf and resort ownership and management company) was suspended by the state.  This is false.  The Bellagio Road she makes reference to went defunct in 2007 and was headed by a man named Trent Merrill.  Mr. Merrill has never had any involvement with Mr. Husband and the two corporations have no relationship to each other.  Mr. Merrill’s corporation was in the land and housing development business and has been suspended by the DOC of California. The Bellagio Road she brings up is formed under the California Dept. of Corporations, here is the I.D. # 200704710008 of Mr. Merrill’s Bellagio.  Mr. Husband’s Bellagio Road Corporation, with which RMCC is working with was formed under the DOC of Delaware.  The I.D. # is 517605 and the filing date was 3/26/2015.   The only reason I know about the Bellagio Road in California is I took the time to look it up on the Department of Corporations website.

Second, Mr. Husband was extensively vetted by several members of your Board and found to be of outstanding character, financial responsibility and professional experience.  Enactment of the purchase option did not require membership approval.  As the elected representatives of the membership, the Board of Directors has the authority to proceed with this option as spelled out in Section 10 of the amended lease dated May 15, 2008.  As a mutual benefit corporation the Board has this authority.  The board has acted in the most judicious manner possible and has kept our members aware of all of our actions.

The RMCC Board unanimously felt that it was in our members' best interest to proceed with this purchase and sale to Mr. Husband.  It will allow us to implement desperately needed upgrades, bring in resources and expertise.  For these reasons the purchase process was expedited.  If the membership votes are not approved by our members then we have lost the available window to purchase the club until 2021.  Unfortunately, Ms. Ward’s assertion that this sale will be costly to the club and cost RMCC $100,000 in appraisal fees is again false. The Memorandum of Understanding (MOU) with Mr. Husband stipulates that Bellagio Road LLC is providing the funding for the appraisal fees and arbitration at no cost or liability to the Club.

Ms. Ward’s next point regarding a $2.3-million-dollar price in the MOU is again incorrect.  There is no price mentioned in our MOU. It has always been clear to the Board and to Mr. Husband that the lease calls for a negotiated sale based on appraisals of what the golf course is worth on the open market.  It will not be based on the value of buildable raw land.  The “value” of the land purchased by Murieta Properties LLC and accepted by the County has no bearing on the actual value of the golf club.  That value will be based on the determination made by two independent appraisers and, if necessary, an arbitrator.

Ms. Ward points out that the County has valued the club at $8.4 million.  She also states that the appraised value is $8 million, however we have never seen or have been asked to participate or provide any information as it relates to an appraisal thus it would seem that the “value” of RMCC is best determined by getting the two independent appraisals based on today’s market value of all of the land.

Finally, I just wish that Ms. Ward would have attended at least 1 of the 3 membership meetings, or asked for a copy of the Q&A (as it relates to Bellagio and reasons for the exercise of our option), or read the MOU that is available to all members or watch the town hall meeting on the club’s website.

I hope these comments can dispel the impression that the Board of RMCC has acted inappropriately, in any way that would jeopardize its fiduciary responsibility or acted against the best interests of our full membership.

Vince Lepera
President, RMCC Board of Directors

Todd Coulter's picture
Joined: 08/07/2007
Posts: 74
Great response

First off a disclosure, I have no interest or membership in the country club nor do I know either Carol or Vince.

My opinion is Vince wrote an outstanding rebuttal letter and if all is true really dropped the hammer on Carol's position and letter. His points were very articulate and his research looks solid.

It makes me wonder what the position or motive was in Carol posting a letter originally and then making accusations without any backup files or documentation. Very bad move and makes her look like a total rookie.

I suspect Carol will be posting here shortly with an apology letter - at least I would hope so unl;ess she has her own documentation (which she failed to attach the first time).

My two cents..

Todd

RM.com's picture
Joined: 06/19/2007
Posts: 27726
Enclosure from Carol Anderson Ward's letter

On Friday, we received the enclosure that was missing from Carol Anderson Ward's post from the day before. You can download the PDF here. The document deals with the suspended registration of a limited-liability company named Bellagio Road. It does not seem to contradict the argument made in the followup letter by Vince Lepera, club president.

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