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May 8, 2015
Gentleman
In follow up to the proposed settlement agreement forwarded on your behalf, I would like
to provide additional information as well as an alternative resolution. I also refer you to
my correspondence to you of April 13, 2015 for background purposes.
I note that the Plan references the Davidheiser tract as the Wynstone Project. This was
an unintentional error that was not picked up on by anyone including your counsel. If you
look at the Cash Flow Summaries, you will note that Todd and I contributed multiple
other parcels to achieve the numbers to be paid to the Creditors. My point is, we were
contributing more than what was described. We certainly were not trying to provide less
than what was incorrectly disclosed.
The financing in question which included the Project conveyance that we were
undertaking, was from our understanding being completed as Ordinary Course. The
entities were not in Bankruptcy. Every thing in the Plan is of course subject to the every
day risks of business such as market conditions etc.
When THP defaulted on the financing that was entered into with RP Wynstone, I
indicated to you in our weekly meetings as demonstrated in the agendas prepared by you,
that one way or another this money would be paid even if I needed to pay it even though I
was no longer involved with THP. You asked for specifics and a guarantee which I was
unable to provide until I successfully reached an agreement to purchase an appropriate
property.
About the time that I reached an agreement to acquire the 180 units in Wynstone, you
filed to reopen the Bankruptcy case.
With all of the above noted, I am confident that the 180 stacked townhouses can provide
for payment as outlined in the Plan and Disclosure which as I see it is a matter of the Plan
experiencing a challenge in our inability to acquire the required land development
approvals in a timeframe that allowed the necessary start of construction of that site and
121 North Main Street, Suite 102, Souderton PA 18964
215.660.3130 www.aredevlopment.com
THP or in this case me working out a solution to resolve the issue and achieve the same
desired or intend result.
My revised proposal goes a step further than what I proposed earlier by way of insuring
that construction is completed by THP and its vendors to help benefit the parties even
further and to eliminate the apparent complications of a third party builder and developer.
That said, If this is found acceptable, I believe that this can be accomplished through a
simple Agreement of Sale between me and THP with an acknowledgment from RP
Wynstone of the fact that they have agreed to sell the 180 units to me under the terms
outlined in our agreement..
In a short summary, my proposal is as follows.
An Agreement of Sale is entered into to sell the 180 units to THP on a phase by phase
basis. THP to have the option to buy 90 stacked townhouse lots for construction of 180
stacked townhouses. THP to pay for lots one phase at a time with in 60 days of final
approval for said phase. Purchase price to be $17,000.00 per unit plus the then applicable
sewer EDU fee. THP will be responsible for on site improvements only.
In this scenario, the numbers break down as follows,
Acquisition $17,000.00
Sewer EDU +/- $3,400.00
Site improvements +/- $10,000.00 per unit (If the transaction is acceptable, I have
numbers to support this. Keep in mind, we are only dealing with on
site costs)
Payment to Creditors $20,000.00
THP overhead $17,000.00 per unit as defined in the approved Plan. Remember that Todd
signed the Separation Agreement drafted by him waiving any
profits from Wynstone.
The above totals $67,000.00. This number plus cost to construct would achieve the
required payment to Creditors as well as cover THPs costs. The cost to construct can be
verified in the Plan as they are part of it and were supplied by Shaun, Chad and Todd.
Per the Plan on Northgate 4, the payment to GSRE plus the +/- $9,000.00 that Ive been
told is being paid to H&K plus Overhead equals about $63,000.00. We need to subtract
transfer tax since it is not in the Northgate budget so we arrive at $61,500.00.
121 North Main Street, Suite 102, Souderton PA 18964
215.660.3130 www.aredevlopment.com