Most Frequently Asked Questions
FAQ

REGARDING THE SALE OF THE WOODLANDS’ PUBLIC GOLF COURSES
AND THE WOODLANDS COUNTRY CLUB

Q:        What has transpired to date?

A:            Sequoia/Canongate Golf LLC, the Buyer, has signed a contract to purchase The Oaks and Panther Trail public golf courses and The Woodlands Country Club from The Woodlands Development Company (TWDC), the Seller.  Both parties are currently engaged in due diligence. The closing of the sale will most likely happen in 60 days.

Q:        Why is TWDC selling the public courses and The Woodlands Country Club at this time?

A:         As TWDC transitions towards the eventual build-out of The Woodlands, the Company continues to concentrate focus on its core business – residential and commercial development.  The developer’s long-standing strategy is to develop assets and market them to specialists in certain fields; examples include the sale of a 50% interest in The Woodlands Mall to General Growth Properties, an expert in mall and mixed use development; the sale to Trademark Properties of the land for development of Market Street; and the sale of the property management function to PM Realty. All of these strategic alliances have resulted in enhanced quality of amenities and services for the residents of the community. TWDC believes that the sale of the public golf courses and The Woodlands Country Club to Sequoia/Canongate will take the clubs to a higher level of membership satisfaction, making this partnership another productive alliance for all those concerned.

Q:        Why was Sequoia/Canongate LLC selected as the Buyer?

A:            Sequoia/Canongate Golf is managed by Joe Guerra, a principal partner who has more than two decades owning and operating private Clubs of equal stature to The Woodlands facilities. All Sequoia/Canongate does is own and operate private clubs.  In addition, many of his team members have extensive expertise in managing golf and country clubs. Sequoia/Canongate Golf has quickly become a private golf leader in the Atlanta market. The Company purchased seven clubs in that market four years ago, and has since expanded its holdings to 18 clubs. They have a business model that appears to be the new trend in major markets. Their intention is to position The Woodlands and all of its golf courses as the flagship property for their entrance into the greater Houston market.

For more information about Sequoia/Canongate, log on to www.canongategolf.com.

Q:        What properties are included in the sale package?

• The East Course and Clubhouse, Golf Hall of Fame Building, and East Course Maintenance Facilities.
• The Oaks and Panther Trail Golf Courses, Golf Pro Shop, Guest Locker Rooms, Spartilo and a portion of the kitchen to support that restaurant.
• The existing Tennis Facilities including the Pro Shop and indoor courts.
• The Palmer Clubhouse amenities and Golf Courses along with the Maintenance Facilities.
• The Player Clubhouse amenities and Golf Course along with the Maintenance Facilities.

The contract between TWDC and Sequoia/Canongate stipulates that the renovation of the East Course Clubhouse will be completed by TWDC. Completion is planned for July, 2007.  

Q:        Is The Woodlands Athletic Club (WAC) included in the sale?

A:         No, the plan is to close this facility in late 2008.  Those WAC members who transferred their memberships to The Woodlands Country Club will continue to enjoy the benefits of membership in The Woodlands Country Club.

Q:        What usage rights will The Woodlands Country Club members have at The Woodlands Athletic Club after the sale?

A:        The Woodlands Country Club members will continue to enjoy the use of that facility until such time as it closes.

Q:       What benefits will be offered to members of The Woodlands Country Club as a result of the sale?

A:            Sequoia/Canongate plans to maintain or enhance the level of benefits and services now enjoyed by members of The Woodlands Country Club. The Company has a unique business model designed to take golf and country clubs to a higher membership satisfaction level. Members have reciprocal play rights on all golf courses the Company owns or manages, as well as several flexible membership level options. Members of The Woodlands Country Club will soon have more courses to play, as Sequoia/Canongate plans to acquire additional properties in the Houston area.

No immediate change in fee structure is planned and memberships will be automatically transferred to the new ownership, with no initiation fees required by members. The way golf is played should be virtually seamless to Country Club members.

Q:        Will there be any changes in the golf usage rights by guests at The Woodlands Resort?

A:        Guests at The Woodlands Resort will continue to have access to both The Oaks and Panther Trail courses for group and individual rounds as they have in the past.

Q:        Will there be any changes in the tennis usage rights by guests of The Woodlands Resort?

A:        Resort guests will continue to be allowed access to the tennis courts on a space available basis. This is very minimal through the year.

Q:        Will charging privileges be reinstated for Woodlands Country Club members for dining privileges at Spartilo?

A.:        The new owner will be installing their own accounting and software system over time and we anticipate that Country Club members will have charging privileges again at The Oaks and Panther Trail Golf Pro Shop and Spartilo.

Q:        Are there plans to continue the capital improvement strategy for The Woodlands Country Club to include the Tennis and Fitness Facility at Creekside Park and the Fitness Center at the renovated East Course Clubhouse?

A:        This will be totally up to the new owner. We have provided them with all of our previous work on these facilities and they will complete their own due diligence and master plan once they have completed the purchase.

Q:         How will employees of The Woodlands Country Club be affected?

A:        TWDC did not plan to build any new golf courses in The Woodlands. Therefore, employees at The Oaks, Panther Trail and The Woodlands Country Club were locked into their current positions with little opportunity for advancement. One of the main reasons Sequoia/Canongate was chosen by TWDC was to expand opportunities for advancement to its employees.

            All current staff will remain in place, with the exception of Bill Langley, Managing Director of The Clubs of The Woodlands and Mark Zientek, Clubhouse Manager for The Woodlands Country Club. Both Langley and Zientek have chosen to remain employees of TWDC, as Managing Director and Clubhouse Manager, respectively, of The Club at Carlton Woods. The new owner will bring several key individuals to The Woodlands Country Club to assist in the transition and ongoing management at the top level. Both Langley and Zientek will also remain very involved with The Woodlands Country Club through the transition.

Q.        How will the current quality of the facilities, amenities and programming change with the change of ownership?

A.            Sequoia/Canongate has agreed to continue to operate The Club at the current level of quality. All of their clubs are operated such that they receive high ratings of member satisfaction. In addition, they fully embrace our current philosophy of operating the facility as a true family oriented private club with programming for all ages of our membership.

Please feel free to send us your other questions, comments or concerns to drogers@thewoodlands.com and we will respond as soon as possible.

*The FAQ’s contain our best knowledge of the impending transaction and
Canongate’s plans for the future.  Answers are subject to change and modification. None of the information expressed or implied is guaranteed.