Judge approves Hermitage agreements
BURLINGTON — Federal Bankruptcy Judge Colleen A. Brown signed orders intended to help get Hermitage Club assets sold and creditors paid.
Filed Monday in United States Bankruptcy Court for the District of Vermont were three stipulation and consent orders. Barnstormer Summit Lift LLC, Berkshire Bank and BSA Architects Inc. have agreed to terms outlined by Raymond J. Obuchowski, the Chapter 7 bankruptcy trustee assigned to the case.
Barnstormer Summit Lift LLC is made up of former club members who invested in a heated six-passenger bubble chairlift at Haystack Mountain in Wilmington, where the Hermitage ran a private ski resort until the company faced financial struggles and had to shut down in 2018. The Barnstormer group was owed about $10,352,582 as of July 24, according to an order issued Monday.
Boyne USA Inc. offered $3.6 million to purchase the chairlift and associated equipment. The company operates ski resorts in North America including Loon Mountain in New Hampshire, Sugarloaf Mountain and Sunday River in Maine, Big Sky Resort in Montana, Brighton Resort in Utah and Cypress Mountain in British Columbia.
The Hermitage estate is to receive 6.25 percent of the proceeds for selling the lift. Those funds are to be used for administration costs associated with the sale and paying claims, according to the order.
If a higher offer comes in, the Barnstormer group "must approve the buyer and terms and price for the sale," the order states.
Part of a $4 million proposal from Rainmaker Mountain LLC involves the sale of the resort, golf course and three inns. The deal also includes 10 lots of land that are not considered collateral to Berkshire Bank, which filed a foreclosure complaint against the Hermitage in 2018 after the company missed loan payments.
BSA has "the first priority lien interest" to the 10 lots after real estate taxes, according to an order issued Monday. The group is said to be owed about $151,594 as of Oct. 31.
Obuchowski and BSA agreed to the Hermitage estate paying BSA $30,000 for the lots. But they "do not believe that the value of the 10 lots exceeds the value of the BSA lien ..." the order states. BSA could seek foreclosure or other remedies but "the time, expense and the complexity ... would in all likelihood diminish the eventual recovery from such property and ultimate recovery to BSA."
Berkshire Bank was owed more than $22 million as of July 22, according to the last order issued Monday. The bank agreed that 6.25 percent of the sale proceeds can go toward administrative costs associated with the sale and paying claims.
The bank also agreed to pay NEC Fianancial Services LLC $25,000 from sale proceeds for interest or claims related to Hermitage properties. In 2018, courts in Vermont and Connecticut ordered the Hermitage to pay NEC nearly $700,000 for what the company was owed after the Hermitage defaulted on a lease for sound system equipment.
If a buyer comes forward for the Hermitage properties Rainmaker Mountain has made on an offer on, the bid must be determined to be "qualified" by Obuchowski. He has proposed a deadline of Feb. 20 for bids on the assets with a sale on Feb. 25.
Reach staff writer Chris Mays at firstname.lastname@example.org, at @CMaysBR on Twitter and 802-254-2311, ext. 273.
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