Hermitage sale closes, members look ahead

Hermitage Club members now own the bankrupt companies' assets.

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WILMINGTON — Hermitage Members Club Inc. officially owns the assets formerly belonging to the bankrupt Hermitage Club.

"With 181 member families and counting, the members of HMC look forward to working with the local community to rebuild your trust from the actions of prior ownership," the group said in a news release. "As homeowners in the Deerfield Valley, the members are delighted to enjoy the natural beauty, services and hospitality that the Valley has to offer. We thank the whole community for supporting our efforts as we seek to establish a thriving club in the Valley."

On Wednesday, the group announced closing on the sale of the assets in Wilmington and West Dover. The group described itself as "a member-owned entity established to own and operate the Hermitage Club as a private, four-season, family-friendly ski resort on Haystack Mountain."

The group said it is "proud to be working with Jon and Jim Schaefer and the Berkshire East team team as we re-launch mountain operations in anticipation of opening ski/snowboard activities for the 2020-2021 season." The Schaefer brothers are co-owners of the Berkshire East ski resort in Charlemont, Mass.

"Berkshire East is consulting with the board and relevant member committees on all aspects to restart mountain and club operations," Kyle Koslowsky, who handles media relations for the group, told the Reformer. "The club is

relying on their extensive expertise in ski mountain operations and we are delighted to be working with them."

Koslowsky said it is too early to tell if the golf course will open this year.

A board of directors for the group will remain in place until an annual meeting in October when members will appoint a new board. Current board members include Nick Botta, Mark Buschmann, Greg Gilbert, Jason Gross, Alex Hammett, Jeffrey Koslowsky, John Nesland, John Reilly, Rosario Ruffino and Carl Stickel.

On Tuesday, U.S. Bankruptcy Judge Colleen A. Brown denied Berkshire Bank's motion to compel the sale of Hermitage Club properties to the group, which won an auction in Month and agreed to a closing on the sale by April 30.

Attorneys for Berkshire Bank, which filed a foreclosure complaint in state civil court in February 2018, said in a filing last week that "no reasonable explanation" was provided for the failure to close on the sale on the scheduled date. They expressed concerns about having to continue to fund expenses to maintain the properties past the scheduled closing date. They had suggested the properties be sold to an initial bidder, whose offer in January started the process for organizing an auction, if the member group could not follow through with the agreement.

Citing stipulations in the purchase agreement related to liens, Brown ordered the closing of the sale to happen by Friday unless the court extends deadline.

The purchase agreement includes the sale of the ski resort used as a private club, golf course and several inns. Part of the contract requires a "clean title," or not having any lien or levy from creditors that might call into question the legal ownership of the properties.

Responding to the bank's motion, attorneys for the member group said the bankruptcy trustee assigned to the case had not been able to provide adequate notice of the sale to three lienholders. They also mentioned an appeal of the court's sale order brought by Jim Barnes, who ran the Hermitage companies.

"'Final Order' is defined in the Agreement (page 3) as an order from which no timely appeal has been taken or from which an appeal has been taken and the appeal has been resolved," the group's attorneys wrote in a court filing. "The Sale Order is not a Final Order. The 'Bankruptcy Contingencies' have not been satisfied."

In her most recent order, Brown does not mention Barnes nor the appeal but said sufficient notice was given to three lienholders. She also agreed with the member group's attorneys that a lien filed by an engineer firm was no longer enforceable and no further notice is needed.

The group's attorneys called the motion made by the bank to compel the sale of the properties "another impediment in a difficult process at a very difficult time."

"The Member Group is a group of concerned stakeholders who wish to preserve the resort for the benefit of the public, the community and the membership. They too have made a substantial commitment to the process," attorneys for the group wrote. "The Member Group does not seek sanctions from the Bank or counsel for filing the Motion, they are willing to acknowledge the good intentions of the Bank and counsel and to work cooperatively to a common end."

Reach staff writer Chris Mays at cmays@reformer.com and at @CMaysBR on Twitter.


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