GILROY
– The Dispatch has obtained a draft copy of a buy-out agreement
between Bonfante Gardens and its creditors.
GILROY – The Dispatch has obtained a draft copy of a buy-out agreement between Bonfante Gardens and its creditors.
The agreement hinges on a 33-acre real estate deal between the park and Shapell Industries, the developer of the gated Eagle Ridge community which borders Bonfante Gardens.
If successful, the land deal will help to lower the park’s debt from $70 million to $14 million, officials say.
Highlights of the agreement
• Bonfante Gardens will sell a 33-acre parcel to Shapell for $18 million.
• Bonfante Gardens will pay off roughly $13.3 million of debt at a reduced amount of $12 million.
• Bonfante Gardens must commit $290,000 for park “refurbishment and refreshment” (essentially maintenance and routine improvements).
• Shapell Industries will have to pay $100,000 to clear the 33-acre parcel of all structures, landscape material, debris, etc.
The site is used for storage now.
• Bonfante Gardens will pay closing costs totaling $10,000 if the real estate deal goes through.
• The lawyer for junior bondholders will receive $800,000 once Bonfante Gardens pays those creditors the $9.8 million they are owed.
Junior bondholders are the creditors who are second in line to be paid back if the park is foreclosed on.
Tomorrow: A rundown of who gave loans to the park and how much money they can expect to get paid back.
