By MATEUSZ PERKOWSKI
An Oregon nursery will turn over all of its real estate holdings to a major creditor as part of a bankruptcy plan recently approved by a judge.
Leo Gentry Wholesale Nursery, based in Damascus, Ore., has agreed to turn over nine properties worth nearly $9.3 million to Northwest Farm Credit Services by early June, when the plan becomes effective.
The company's owner, Leo Gentry Sr., will have the option of keeping one of the properties as his home residence and making mortgage payments on it.
As part of the deal, the company will lease those properties back from Northwest Farm Credit Services through July 2017. The nursery will have the opportunity to buy back the properties until then.
Beginning this summer, the nursery will also have to pay the creditor $1.5 million annually for six years, with roughly one-third of each payment earmarked for rent.
In February 2012, Leo Gentry Wholesale Nursery filed for Chapter 11 bankruptcy protection after Northwest Farm Credit Services sought to foreclose on several properties that served as collateral, according to bankruptcy documents.
The company's finances deteriorated after the burst of the housing bubble, but it has since cut expenses, increased automation and returned to profitability, bankruptcy documents said.
At the time of bankruptcy, the nursery owed about $30.9 million to creditors, according to a financial summary filed last year.