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January 12, 2012 Meeting Agenda: Refinancing Club Loan Consideration and Approval

This meeting seeks to discuss the proposed refinancing of the existing club loan. The current loan, acquired in October 2010 for $3.5 million, holds a 9.5% interest rate, with discussions ongoing to reduce this to a maximum of 5% for a new loan term of 7 years. We will outline the terms, conditions, and voting requirements for approval. Other key topics include the acquisition background, proposed loan conditions, and preparation for the upcoming vote. Participation is essential for club members.

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January 12, 2012 Meeting Agenda: Refinancing Club Loan Consideration and Approval

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Presentation Transcript

  1. January 12, 2012 Meeting to Consider Refinance of Club Loan

  2. Meeting Agenda • Meeting Only to Consider Refinance • Acquisition Background • Current vs. Proposed Loan • Terms & Conditions of New Loan • Voting Requirements • Questions? • Vote • Results • Adjourn

  3. Background • February 2010 – SLV Acquires Remaining Lots in TBG&CC • Club Owned by Tampa Bay Golf & Recreation, LLC • Decision to Pursue Acquisition of Club by HOA • October 29, 2010 – HOA Acquires Club for $3,500,000 using a $3,750,000 Short-Term Loan from SLV Tampa, LLC • Starting March 2011, Begin Discussions with Lenders on Potential Refinance

  4. Existing Loan Terms • Principal Amount $3,750,000 • Term – 3 years • Interest Only at 9.5% • Monthly Payments – $29,688 • Origination Date – October 29, 2010

  5. New Loan Terms • Loan by BB&T • Principal Balance – $3,750,000 • Term– 7 years Amortized Over 15 years • Interest Rate Fixed at 4.85 – 5%. Requesting • approval at 5% • Monthly Payments – $29,796 • PrincipalBalance at Term of Loan – $2,377,126 • Closing on or before 2/17/2012

  6. Partial List of Other Loan Conditions/Terms • Pre-Payment Penalty • 3% Fee if Loan is Prepaid in 1st or 2ndYear • 2% Fee if Loan is Prepaid in 3rd or 4th Year • 1% Fee if Loan is Prepaid in 5th or 6th Year • Up to 10% of Loan Balance can be Prepaid Annually Without Penalty • Loan Costs – Borrower Bears All Costs Incurred in Connection • with Financing • Estimated Costs ?? • Appraisal Complete – Value of $5,700,000 • Accepted Existing Environmental Report – Fee only $450 • Complete Survey Not Required • Loan Origination Fee of 0.625% on $23,437.50 • Loan Costs Paid Out of Operating Account

  7. Partial List of Other Loan Conditions/Terms • HOA to Establish & Maintain Primary Golf & Country Club • Operating Account With BB&T • Starwood Required to Establish an Escrow Account of • $250,000 with BB&T to be Reduced Based on Closings • Annually • HOA Required to Maintain Liability & Hazard Insurance • Requirement to Provide Financial Information Annually to • Bank

  8. Summary & Conclusions • Reduction of Interest Rate from 9.5% to • a Maximum of 5% • Same Original Principal Balance of $3,750,000 • Monthly Payment on Old Loan – $29,688 • Monthly Payment on New Loan - $29,796 • Association Responsible for All Closing Costs • No Affect on HOA Fees!

  9. Vote Requirements • Multiple Requirements in Governing Documents Related to Mortgaging Property • Section 2.3.2 of Declaration Provides that While Declarant Controls Board, No Mortgage on Common Area Without Consent of at Least 51% of Owners Other than Declarant • Section 5.19.9 of Bylaws Provides Board Authority to Borrow Money but Requires 2/3 Vote of Owners to Borrow Money in Excess of $25,000. This Vote Includes Declarant Lots at 2 Votes for Each Lot Owned.

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