Naples Bay Resort still afloat after court hearing

— Tourists can keep their reservations and employees can keep their jobs at the Naples Bay Resort.

At a hearing in federal court Tuesday, a settlement was struck that's expected to provide enough operating dollars for the resort through mid-January, when the busy winter season kicks into high gear and the business can cover its own bills again.

The compromise should mean no mass layoffs, or need to file a so-called WARN notice with the state in coming weeks. The resort would have to file a notice with the state under the Worker Adjustment and Retraining Notification Act if it was letting go more than 50 employees.

"We hope we do not have to send those notices," said Richard Malchon Jr., who represents Benchmark Hospitality, the resort's management company. "It's all very positive."

The resort has about 110 employees and that grows to more than 130 in season.

Negotiations in a federal bankruptcy court in Fort Myers took hours.

A hearing was held Monday and began again at 9 a.m. Tuesday, but it was delayed more than five hours as the two sides worked to reach a compromise. By 3 p.m., there was an agreement to accept $650,000 in financing from Gulfwater Investments LLC based in Naples to cover budget shortfalls and to keep the resort open. The Naples-based investment group has until 2 p.m. Friday to provide the money it has promised, or there will be consequences, including the reappointment of a trustee by the bankruptcy court, who could then seek alternative financing.

For now, the trustee has been removed from the case. A court-appointed receiver, Gerard McHale, a Fort Myers forensic account, will continue to oversee the resort's operations as he's done for more than a year.

Though business at the resort is improving, it has not been able to cover all of the receiver's expenses. Well-known developer Jack Antaramian has covered the shortfalls up until now, totaling $1.2 million. He doesn't want to do it anymore.

At times, tempers flared in the courtroom. U.S. District Court Judge, Jeffery Hopkins, who is overseeing the bankruptcy case, warned about sanctions if the attorneys didn't act professional.

The compromise reached Tuesday was described as a "temporary resolution," but a favorable one by Daniel DeMarco, who is representing Antaramian in the bankruptcy case.

At one point during the hearing, an upset DeMarco described the other side's arguments as "cynical" and a "waste of time."

Antaramian and several other creditors filed an involuntary petition for Chapter 7 bankruptcy against the resort's developer, Basil Street Partners, on Oct. 19.

Antaramian is one of the partners in Basil Street, but he's at odds with his other partners, who are fighting the bankruptcy. His other partners are Fred Pezeshkan, president and CEO of Manhattan Construction (Florida), a general contractor in Naples, and foreign investors Iraj Zand and Raymond Sehayek.

When he filed the petition for bankruptcy, Antaramian said it was the only way to get new financing to keep the resort, near Tin City in downtown Naples, open. A Texas-based investor, EFO Financial Group, was willing to loan nearly $3.8 million to help fund operations and other expenses, but the offer came with conditions, including having the protections that come only with bankruptcy. That deal, which offers long-term financing, was wiped out by the compromise reached Tuesday.

"For now there is no other financing," said Alan Perlman, the attorney representing Basil Street's other partners.

The offer of financing by Gulfwater Investments surfaced this week. According to state records, the company was incorporated in 2010 and its managing members include Alexander Pezeshkan and Kambiz Zand, who are sons of two of the partners Antaramian is feuding with.

McHale told the judge the compromise was "far from perfect," but agreed that it put the two sides on a better path moving forward.

For now, the bankruptcy case will proceed. Antaramian's partners will continue fighting to have it dismissed.

Hopkins ordered the two sides to mediation in hopes they can work out their other issues in the case. The mediation hearing will be held by Dec. 15.

Connect with Laura Layden at www.naplesnews.com/staff/laura_layden.

© 2011 marconews.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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