A U.S. Bankruptcy Court judge in Santa Barbara has approved a Chapter 12 reorganization plan for Salisbury Vineyards LLC, one of several companies owned by Avila Valley winery operator John Salisbury and his family.
Chapter 12 is designed to help debt-burdened family farms operate under bankruptcy court protection while paying off creditors. Salisbury Vineyards declared bankruptcy in the fall.
The bankruptcy in question deals only with a 113-acre property, including a 28-acre vineyard surrounding Bassi Ranch in Avila, not the other businesses owned by the family.
The Salisburys bought the property from Rob Rossi after he decided to sell to another partner, according to John Salisbury. The Salisburys had been leasing the land, and to protect the family’s water rights and a substantial cash investment in the 28 acres of planted grapes on the property, the land was purchased using short-term financing.
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The process to set up long-term financing had been initiated, Salisbury said, but time ran out, and Salisbury Vineyards sought bankruptcy protection when it couldn’t meet its payment obligations.
Salisbury said $1.5 million is owed to creditors, plus interest and attorneys fees for the secured creditors and $189,000 to unsecured creditors. Secured creditors are those who hold collateral or other security on a debt. Unsecured creditors, such as issuers of credit cards and some bank loans, don’t.
Salisbury said the agreement was unanimously accepted by the creditors, and that it requires payment of 5½ percent interest only to secured creditors, and the unsecured creditors would be paid 5 percent for the next 18 months, with a balloon payment for the principal due Oct. 1, 2011.
The vineyard, Salisbury said, makes enough money from the sales of wine grapes to pay the bills and include payments to creditors.
Salisbury has also included as part of the reorganization a plan to sell shares to investors in three companies: the Salisbury’s Schoolhouse property, the Avila Valley vineyard and the sales and winery operation.
Income from the sales of the shares would be used to pay down the debt, expand the tasting-room property in Avila and allow for more events, Salisbury said.
— Julie Lynem
Rotary forms club for young people
In March, local Rotary Club members celebrated the new charter of a Rotaract Club for people between the ages of 18 and 30 from Cambria to Grover Beach.
The club allows young professionals to meet for networking and volunteer activities, such as beach cleanups and international service projects.
Real estate agent Dominic Tartaglia is the club’s president and founding member. Other founding officers include Holly Dragovich, Ciera Tartaglia, John Kozina, Reyes Miranda and Nicolette Lynch.
Rotaract has meetings at Mo Tav — formerly Mother’s Tavern — in San Luis Obispo on the first Tuesday and third Wednesday of every month at 6:30 p.m.
The Rotaract Club of San Luis Obispo is sponsored by Rotary clubs of Grover Beach, Los Osos, Morro Bay, Pismo Beach, San Luis Obispo, San Luis Obispo Daybreak and San Luis Obispo de Tolosa.
It joins more than 7,500 Rotaract clubs around the world that comprise Rotaract International.
— Julia Hickey