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EXHIBIT
664?
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Filed 12 May 10 AT129
Chris Daniel - District Clark
Harris Count
EDT JOIST 2679
y Ne t o6 3 i264 By: shannon north
FR UE BA 1 [IN THE DISTRICT COURT
Pip
OF HARRIS COUNTY TY
ALLEN £. BL
PL
an RO REG TAYLOR,
g
Defendants. DECTAL STRICT
PLAINTIFF'S FIRST AMENDED ORIGINAL PETFTION
Phan? ENCORIE BANK OE “\ Siles this its Amended Or Petidon
n st Defendants ALLEN BERRY, IOSEPTD D. MCCORD, ond ROBERT G AYLOR
“ ad by : vinUy and se alby owes
collec a
1 INTRODUCTION
Encore Is ta conduel dé ery under Level 2, pursuant to Ts de of
Covi! Pre < dure POOLS, & Lines ks me fe Re MOTE 500.00,
Plainifl £ cupe§pg atk J avholly aver e subsidiary of Sacore Banoshe
eqrporat sanlae dg oxi ay tate of Texas, Freare's pringipal
ot leb u 8 located in Te as, at Nine Greenway PL He 800, Houston, Tes: Ye
5 +» vidual and 2 gt al
Defendant Alle ry ig and hel
Wil Way , Honstan, is 77056 4demey be Server with p « bry persot ily serving.
hui wi that adders or wherever he may be found.
ry3 oe ard pe 1D. MeCored i ndividual aad a cttisen of P as whe
at 33 keth Street, blouste as 77088 Ne may be served A
: mind.
serving him af that adi wh he may b
EXHIBIT
“ty Az ume
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5 Defendant Robert G. Taylor is an individual and a citizen of Texas who resides at
2945 Lazy Lane Blvd., Houston, Texas 77019. He may be served with process by personally
serving him at that address, or wherever he may be found.
6 The amount of Encore's damages is in excess of this Court's minimum
jurisdictional requirements.
7 Venue is proper in Haris County under Texas Civil Practice & Remedies Code
§§ 15.002(aK(L), 15.002(e)(2), and 15.035(a). Specifically, all or a subsiautial part of the events
or omissions gceurred in Harris County, Texas, the Defendants reside in Haris County, Texas,
and the agreements at issue in this action provide for performance in Houston, Harris County,
Texas.
T FACTS
8 Defendants are members of BLyn II Holding, LLC ("BLyn"), a limited liability
company organized and existing under the laws of the State of Texas. In August of 2006,
Defendants caused BLyn to purchase the Betty Lyn f (the "Vessel"). Defendants intended to
undertake the renovation and refurbishment of the Vessel in order to transform it into a luxury
yacht and enter the charter business. BLyn sought and obtained financing for the refurbishment
of the Vessel from Encore. On or about March 28, 2007, BLyn and Encore entered into a Letter
Agteement regarding a $6 million loan to BLyn from Encore. See Ex. A. The loan was
evidenced by a Promissory Note—also executed by BLyn on March 28, 2007—in favor of
Encore. See Ex. B. The Promissory Note was secured by a First Preferred Ship Mortgage (the
"PPSM") of the Vessel in favor of Encore. See Ex. C. The FPSM was liled in office of the US.
Coast Guard on June 11, 2067. The Letter Agreement and the Promissory Note were
subsequently amended on or about April 15, 2009, and again on or about March 15, 2010. See
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Ex. B. Collectively, the Letter Agreement, Promissory Note, FPSM, and the subsequent
mendments shall be referred to a3 the "Loan Documents.”
9 As additional security for the loan from Encore to BLyn, Defendants personally
guaranteed the obligations undertaken by BLya pursuant to the Loan Documents. Defendants
*cbsolutely and unconditionally guarantee[d] full and punctual payment and satisfaction of the
indebtedness of Borrower to Lender, and the performance and discharge of all Borrower's
obligations under the Note and the Related Documents." See Ex. E. Further, Defendants
"absolutely and unconditionally covenant[ed] and agree[d] that... in the event that Borrower
does not or is unable to pay or perform the Obligations for any reason including, without
limitation, ... bankruptey .. . then in any case Guarantor shall pay enc perform the Obligations
as herein provided and that no such occurrence shall in any way diminish or affect Guarantor's
obligations hereunder." See Ex. F (collectively, Ex. E and Ex. F. shali be referred to as the
"Guaraniy Agreements"), Defendants agreed that "all amounts becoming payable by Guarantor
”
to Lender under this Guaranty shall be payable at Lender's offices in Houston, Texas...
Defendants expressly acknowledged that Encore would not have iguned BLyn funds without the
personal guarantees of the Defendants. See ia.
10, BLyn is in breach of its obligations under the Loan Documents. BLyn contracted
with Crimson Yachts, an unincorporated division of Horizon Shipbuilding, Inc. (“Crimson"), for
the repair and refurbishment of the Vessel. Due to a dispute regarding the progress of the repair
and refarbishment project, BLyn ceased payment of invoices issued by Crimson in March of
2008. In June of 2008, Crimson filed suit against the Vessel and BLyn, asserting a maritime tien
for necessaries against the Vessel. In June of 2009, Crimson amended its complaint and added
Encore ag a defendant to the lawsuit. Crimson's amended complaint reiterates Crimson’s claim
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of a maritime lien against the Vessel and seeks 2 determination that its maritime lien ts
pararnount and superior to Encore's FPSM.
il. Neither BLyn nor Defendants informed Encore of the dispute with Crimson, or
that Crimson asserted various liens against the Vessel, as required by Article L8 of the FPSM.
Further, despite repeated demands by Encore, BLyn and Defendants refused to discharge the lien
asserted by Crimson as required by Article L7 of the FSM. See Ex, C. Finaily, on August 19,
2010, BLyn filed a voluntary bankruptcy petition in the Southern District of Texas. See Ex. G.
The Bankruptcy Court entered its Findings of Fact and Conclusion of Law on January 6, 2012.
12. An event of default has occurred under the Loan Documents and the Guaranty
Agreements. Defendants received notice of the default and have refused to cure same. Encore
made demand for peyment upon Defendants and Defendants refused, and continue to refuse, to
comply with their obligations as set forth in the Guaranty Agreements, afl to Encore's damage in
the amount of $3,598,950.00, plus interest, penalties, and reasonable and necessary attomey's
fees. See Bx. H.
13. Addiionally, based on the terms of the March 15, 2010 Note Modification
Agreement, the entire amount of unpaid principal and interest became due and payable on March
15, 2012 when the Note matured. Defendants provided consent for the modification. See Ex. |.
However, Defendants have failed and refused, and continue to fail and refuse, to pay the eatice
amount of unpaid principal and interest due on the note.
4, All conditions precedent, if any, necessary for Encore's enforcement cf the
Guaranty Agreements, ar to Encore's recovery from Defendants for Defendants’ breach of the
terms of ihe Guaranty Agreements, have been performed or have occurred.
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Tl. CAUSES OF ACTION
A. Breach of Contract
Is. Encore herehy re-alleges and incorporates by reference the facts and allegations
contained in the foregoing parapraphs.
16. There is a valid, enforceable contract between Encore and Defendants; Encore is a
proper party to sue for breach of the contract, Encore performed its contractual obligations; and
Defendants’ conduct constitutes a breach of the terms and conditions of the Guaranty
Agreements.
i? Asa natural and probable result of, or ay a proximate result of, the breach of the
contract by Defendants, Encore has suffercd actual damages in the amount of $3,598,950.00,
plus interest, penalties, and reasonable and necessary attomey's fees. Accordingly, Encore sues
and assert its claim for all of such damages, including attorney's fees and all pre- post-judgment
interest allowed by law.
B. Suit on Guaranty
18. Encore hereby re-alleges and incorporates by reference the facts and allegations
contained in the foregoing paragraphs.
19. Defendants executed valid Guaranty Agreements in favor of Encore, Encore
performed {is obligations under the Loan Documents and fhe Guaranty Agreemeuts, the
conditions upon with Defendants’ Liability is based have occurred; and Defendants have failed to
perform their obligations under the Guaranty Agreements.
2). Asa natural and probable result of, or as a proximate result of, Defendants’ breach
of guaranty, Encore has suffered actual damages in the amount of $3,598,950.00, plus interest,
penalties, and reasonable and necessary attorney's fees. Accordingly, Encore sues and asserts its
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claim for all of such damages. inchiding attomey’s fees and all pre- and post-judgment interest
allowed by law.
IV. ATTORNEY'S FEES AND COSTS
21. Under the terms of the Guaranty Agreements, Defendants are responsible for
payment of all costs, attorney's fees, and expenses incurred by Encore in connection with any
default under the Loan Documents or in enforcing any rights under the Guaranty Agreements.
Further, an award of attorney's fees is authorized under and according to the provisions of Texas
Civil Practice & Remedies Code 438.001 ef. seg. Accordingly, Encore secks recovery of its
reasonable and necessary attomey's fees from Defendants, as it has been required to employ legal
counsel to defend it in the suit filed to enforce a maritime lien against the Vessel and to file this
suit.
V. PRAYER
WHEREFORE, Plaintiff Encore Bank prays that Defendants Allen L. Berry, Joseph D.
MeCord, and Robert G. Taylor be cited to appear and answer, and that efter a trial on the merits,
the Court enter judgment against them, jointly and severally, as follows:
i Awarding Plaintiff its actual damages in the amount of $3,598,950.00, plus
interest and penalties;
2 Awarding Plaintiif all pre- and post-judgment interest thereon as allowed by law
at the highest rate allowed by law; /
3 Awarding Plaintiff reasonable attomey‘s foes, inasmuch ag Plaintiff was required
to employ the undersigned aftorneys to defend it in the suit filed to enforce a maritime lien
against the Vessel and to file this suit and it has agreed to pay them a reasonable fee for their
services;
4, Awarding Plaintiff's costs of suit; and
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.
3 Awarding Plaintiff such other and further relief, general or special, at law or in
equity, to which Plaintiff may be justly entitled.
Respectfully submitted,
BRACEWELL & GIULIANI, L.LP.
By: s/Brvan S$. Dumesnil
Bryan §. Dumesnil
State Bar No.: 60793650
Linda R. Rovira
State Bar No.: 24064937
711 Louisiana Street, Suite 2300
Houston, Texas 77002-2781
(713) 221-1113 Telephone
(713) 221-1212 Facsimile
o>
bryan. dumesniv@bulip.com
Linda. rovirageb a
ATTORNEYS FOR PLAINTIFF ENCORE
BANK
OF COUNSEL:
DOBROWSKL LARKIN & JGHNSON L.L.P.
3fPaul
See J. Eee
Dobrowski
ecermmmmtet
Paul I, Dobrowski
SBN 05927100
Cody W. Stafford
SBN 24068238
4601 Washington Avenue, Suite 300
Houston, Texas 77007
713.659.2900 — Telephone
713.659.2908 — Facsimile
-7-
A4N88006.S
Preview
08/30/2013 03:24:42 PM 713-755-1451 Page 1/9 EXHIBIT 664? 08/30/2013 03:24:42 PM 713-755-1451 Page 2/9 Filed 12 May 10 AT129 Chris Daniel - District Clark Harris Count EDT JOIST 2679 y Ne t o6 3 i264 By: shannon north FR UE BA 1 [IN THE DISTRICT COURT Pip OF HARRIS COUNTY TY ALLEN £. BL PL an RO REG TAYLOR, g Defendants. DECTAL STRICT PLAINTIFF'S FIRST AMENDED ORIGINAL PETFTION Phan? ENCORIE BANK OE “\ Siles this its Amended Or Petidon n st Defendants ALLEN BERRY, IOSEPTD D. MCCORD, ond ROBERT G AYLOR “ ad by : vinUy and se alby owes collec a 1 INTRODUCTION Encore Is ta conduel dé ery under Level 2, pursuant to Ts de of Covi! Pre < dure POOLS, & Lines ks me fe Re MOTE 500.00, Plainifl £ cupe§pg atk J avholly aver e subsidiary of Sacore Banoshe eqrporat sanlae dg oxi ay tate of Texas, Freare's pringipal ot leb u 8 located in Te as, at Nine Greenway PL He 800, Houston, Tes: Ye 5 +» vidual and 2 gt al Defendant Alle ry ig and hel Wil Way , Honstan, is 77056 4demey be Server with p « bry persot ily serving. hui wi that adders or wherever he may be found. ry3 oe ard pe 1D. MeCored i ndividual aad a cttisen of P as whe at 33 keth Street, blouste as 77088 Ne may be served A : mind. serving him af that adi wh he may b EXHIBIT “ty Az ume Dl pe Rp 08/30/2013 03:24:42 PM 713-755-1451 Page 3/9 5 Defendant Robert G. Taylor is an individual and a citizen of Texas who resides at 2945 Lazy Lane Blvd., Houston, Texas 77019. He may be served with process by personally serving him at that address, or wherever he may be found. 6 The amount of Encore's damages is in excess of this Court's minimum jurisdictional requirements. 7 Venue is proper in Haris County under Texas Civil Practice & Remedies Code §§ 15.002(aK(L), 15.002(e)(2), and 15.035(a). Specifically, all or a subsiautial part of the events or omissions gceurred in Harris County, Texas, the Defendants reside in Haris County, Texas, and the agreements at issue in this action provide for performance in Houston, Harris County, Texas. T FACTS 8 Defendants are members of BLyn II Holding, LLC ("BLyn"), a limited liability company organized and existing under the laws of the State of Texas. In August of 2006, Defendants caused BLyn to purchase the Betty Lyn f (the "Vessel"). Defendants intended to undertake the renovation and refurbishment of the Vessel in order to transform it into a luxury yacht and enter the charter business. BLyn sought and obtained financing for the refurbishment of the Vessel from Encore. On or about March 28, 2007, BLyn and Encore entered into a Letter Agteement regarding a $6 million loan to BLyn from Encore. See Ex. A. The loan was evidenced by a Promissory Note—also executed by BLyn on March 28, 2007—in favor of Encore. See Ex. B. The Promissory Note was secured by a First Preferred Ship Mortgage (the "PPSM") of the Vessel in favor of Encore. See Ex. C. The FPSM was liled in office of the US. Coast Guard on June 11, 2067. The Letter Agreement and the Promissory Note were subsequently amended on or about April 15, 2009, and again on or about March 15, 2010. See ~2- PAQREOTS. L 08/30/2013 03:24:42 PM 713-755-1451 Page 4/9 Ex. B. Collectively, the Letter Agreement, Promissory Note, FPSM, and the subsequent mendments shall be referred to a3 the "Loan Documents.” 9 As additional security for the loan from Encore to BLyn, Defendants personally guaranteed the obligations undertaken by BLya pursuant to the Loan Documents. Defendants *cbsolutely and unconditionally guarantee[d] full and punctual payment and satisfaction of the indebtedness of Borrower to Lender, and the performance and discharge of all Borrower's obligations under the Note and the Related Documents." See Ex. E. Further, Defendants "absolutely and unconditionally covenant[ed] and agree[d] that... in the event that Borrower does not or is unable to pay or perform the Obligations for any reason including, without limitation, ... bankruptey .. . then in any case Guarantor shall pay enc perform the Obligations as herein provided and that no such occurrence shall in any way diminish or affect Guarantor's obligations hereunder." See Ex. F (collectively, Ex. E and Ex. F. shali be referred to as the "Guaraniy Agreements"), Defendants agreed that "all amounts becoming payable by Guarantor ” to Lender under this Guaranty shall be payable at Lender's offices in Houston, Texas... Defendants expressly acknowledged that Encore would not have iguned BLyn funds without the personal guarantees of the Defendants. See ia. 10, BLyn is in breach of its obligations under the Loan Documents. BLyn contracted with Crimson Yachts, an unincorporated division of Horizon Shipbuilding, Inc. (“Crimson"), for the repair and refurbishment of the Vessel. Due to a dispute regarding the progress of the repair and refarbishment project, BLyn ceased payment of invoices issued by Crimson in March of 2008. In June of 2008, Crimson filed suit against the Vessel and BLyn, asserting a maritime tien for necessaries against the Vessel. In June of 2009, Crimson amended its complaint and added Encore ag a defendant to the lawsuit. Crimson's amended complaint reiterates Crimson’s claim -3- PAUREGT 08/30/2013 03:24:42 PM 713-755-1451 Page 5/9 of a maritime lien against the Vessel and seeks 2 determination that its maritime lien ts pararnount and superior to Encore's FPSM. il. Neither BLyn nor Defendants informed Encore of the dispute with Crimson, or that Crimson asserted various liens against the Vessel, as required by Article L8 of the FPSM. Further, despite repeated demands by Encore, BLyn and Defendants refused to discharge the lien asserted by Crimson as required by Article L7 of the FSM. See Ex, C. Finaily, on August 19, 2010, BLyn filed a voluntary bankruptcy petition in the Southern District of Texas. See Ex. G. The Bankruptcy Court entered its Findings of Fact and Conclusion of Law on January 6, 2012. 12. An event of default has occurred under the Loan Documents and the Guaranty Agreements. Defendants received notice of the default and have refused to cure same. Encore made demand for peyment upon Defendants and Defendants refused, and continue to refuse, to comply with their obligations as set forth in the Guaranty Agreements, afl to Encore's damage in the amount of $3,598,950.00, plus interest, penalties, and reasonable and necessary attomey's fees. See Bx. H. 13. Addiionally, based on the terms of the March 15, 2010 Note Modification Agreement, the entire amount of unpaid principal and interest became due and payable on March 15, 2012 when the Note matured. Defendants provided consent for the modification. See Ex. |. However, Defendants have failed and refused, and continue to fail and refuse, to pay the eatice amount of unpaid principal and interest due on the note. 4, All conditions precedent, if any, necessary for Encore's enforcement cf the Guaranty Agreements, ar to Encore's recovery from Defendants for Defendants’ breach of the terms of ihe Guaranty Agreements, have been performed or have occurred. -4- #ADRBO76.1 08/30/2013 03:24:42 PM 713-755-1451 Page 6/9 08/30/2013 03:24:42 PM 713-755-1451 Page 7/9 Tl. CAUSES OF ACTION A. Breach of Contract Is. Encore herehy re-alleges and incorporates by reference the facts and allegations contained in the foregoing parapraphs. 16. There is a valid, enforceable contract between Encore and Defendants; Encore is a proper party to sue for breach of the contract, Encore performed its contractual obligations; and Defendants’ conduct constitutes a breach of the terms and conditions of the Guaranty Agreements. i? Asa natural and probable result of, or ay a proximate result of, the breach of the contract by Defendants, Encore has suffercd actual damages in the amount of $3,598,950.00, plus interest, penalties, and reasonable and necessary attomey's fees. Accordingly, Encore sues and assert its claim for all of such damages, including attorney's fees and all pre- post-judgment interest allowed by law. B. Suit on Guaranty 18. Encore hereby re-alleges and incorporates by reference the facts and allegations contained in the foregoing paragraphs. 19. Defendants executed valid Guaranty Agreements in favor of Encore, Encore performed {is obligations under the Loan Documents and fhe Guaranty Agreemeuts, the conditions upon with Defendants’ Liability is based have occurred; and Defendants have failed to perform their obligations under the Guaranty Agreements. 2). Asa natural and probable result of, or as a proximate result of, Defendants’ breach of guaranty, Encore has suffered actual damages in the amount of $3,598,950.00, plus interest, penalties, and reasonable and necessary attorney's fees. Accordingly, Encore sues and asserts its -5- PACBIOTS.£ . 08/30/2013 03:24:42 PM 713-755-1451 Page 8/9 claim for all of such damages. inchiding attomey’s fees and all pre- and post-judgment interest allowed by law. IV. ATTORNEY'S FEES AND COSTS 21. Under the terms of the Guaranty Agreements, Defendants are responsible for payment of all costs, attorney's fees, and expenses incurred by Encore in connection with any default under the Loan Documents or in enforcing any rights under the Guaranty Agreements. Further, an award of attorney's fees is authorized under and according to the provisions of Texas Civil Practice & Remedies Code 438.001 ef. seg. Accordingly, Encore secks recovery of its reasonable and necessary attomey's fees from Defendants, as it has been required to employ legal counsel to defend it in the suit filed to enforce a maritime lien against the Vessel and to file this suit. V. PRAYER WHEREFORE, Plaintiff Encore Bank prays that Defendants Allen L. Berry, Joseph D. MeCord, and Robert G. Taylor be cited to appear and answer, and that efter a trial on the merits, the Court enter judgment against them, jointly and severally, as follows: i Awarding Plaintiff its actual damages in the amount of $3,598,950.00, plus interest and penalties; 2 Awarding Plaintiif all pre- and post-judgment interest thereon as allowed by law at the highest rate allowed by law; / 3 Awarding Plaintiff reasonable attomey‘s foes, inasmuch ag Plaintiff was required to employ the undersigned aftorneys to defend it in the suit filed to enforce a maritime lien against the Vessel and to file this suit and it has agreed to pay them a reasonable fee for their services; 4, Awarding Plaintiff's costs of suit; and -6- a4088076.1 08/30/2013 03:24:42 PM 713-755-1451 Page 9/9 . 3 Awarding Plaintiff such other and further relief, general or special, at law or in equity, to which Plaintiff may be justly entitled. Respectfully submitted, BRACEWELL & GIULIANI, L.LP. By: s/Brvan S$. Dumesnil Bryan §. Dumesnil State Bar No.: 60793650 Linda R. Rovira State Bar No.: 24064937 711 Louisiana Street, Suite 2300 Houston, Texas 77002-2781 (713) 221-1113 Telephone (713) 221-1212 Facsimile o> bryan. dumesniv@bulip.com Linda. rovirageb a ATTORNEYS FOR PLAINTIFF ENCORE BANK OF COUNSEL: DOBROWSKL LARKIN & JGHNSON L.L.P. 3fPaul See J. Eee Dobrowski ecermmmmtet Paul I, Dobrowski SBN 05927100 Cody W. Stafford SBN 24068238 4601 Washington Avenue, Suite 300 Houston, Texas 77007 713.659.2900 — Telephone 713.659.2908 — Facsimile -7- A4N88006.S