State Fair of Virginia Files for Chapter 7
Carnival Magazine received the following press release from the State Fair of Virginia:
FOR IMMEDIATE RELEASE
SFVA Inc. Converts from Chapter 11 to Chapter 7 Bankruptcy
Lenders reject SFVA's offer to purchase The Meadow Event Park
March 7, 2012 (Doswell, VA) - SFVA Inc., the not-for-profit organization that produces the State Fair of Virginia, today converted its Chapter 11 bankruptcy protection to a Chapter 7 bankruptcy liquidation in Richmond District Court. As a proposed resolution to emerge from the Chapter 11 process, SFVA offered to buy the 360-acre Meadow Event Park in Doswell, Virginia from the lender group of secured creditors (made up of lead lender Arbor One, 13 farm credits and the USDA). On March 5, the lender group rejected the offer and refused requests to produce a counter-offer. Because of the secured creditors' decision not to accept the offer, SFVA Inc. was forced into bankruptcy.
As a result of this action, there will be no further events produced by SFVA Inc., including the Strawberry Hill Races, the State Fair of Virginia and the Meadow Highland Games & Celtic Festival. Additionally the privately scheduled events at The Meadow Event Park will not be able to take place.
"As chairman of SFVA, I am deeply saddened and disappointed by the lenders' decision. We worked diligently with multiple parties to present the secured creditors with a reasonable offer to purchase The Meadow, and thus allow the 156-year-old tradition of the State Fair of Virginia to continue. Unfortunately, that offer was rejected. Apparently, the secured creditors have other unknown plans for the property," said G. William Beale, SFVA Board of Directors Chairman and CEO - Union First Market Bank.
Since 1989, the State Fair of Virginia Scholarship Program has awarded 2,439 scholarships and has dedicated over $1.8 million to youth education. It is SFVA's understanding that these funds will, under the guidance of a bankruptcy court-appointed trustee, be sent to Virginia Tech's foundation for administration and distribution. SFVA's scholarship funds were managed separately from the investment portfolio used as collateral to secure the loan to develop The Meadow Event Park.
"While the outcome of this very difficult situation is extremely disappointing, I am heartened by the support we have received from thousands of well-wishers, Caroline and Hanover County officials, the dedication of our staff, and the partners who have stood by SFVA. We worked hard to create a positive outcome in spite of trying economic times and a uniquely complex situation," said Curry Roberts, President of SFVA Inc.
The lender group opposed providing severance packages to the remaining 17 SFVA staff members, and as of today, all SFVA staff have been removed from payroll and benefit plans. SFVA Inc. requested the creditors release the rights to the State Fair of Virginia, Meadow Highland Games & Celtic Festival and Strawberry Hill Races. The fate of these events and the property will be determined by the Chapter 7 process and ultimately up to the court-appointed trustee.
The secured creditors are made up of the United States Department of Agriculture, Arbor One of Conway, SC; Regions Bank of Greenville, SC; Farm Credit Bank of Texas of Austin, TX; AgTexas of Lubbock, TX; Farm Credit Services of Grand Forks of Grand Forks, ND; Capital Farm Credit of Bryan, TX; AgStar Financial Services of Mankato, MN; Farm Credit Services of Mid-America of Louisville, KY; Ag Credit of Fostoria, OH; Carolina Farm Credit of Hendersonville, NC; Valley Farm Credit of Winchester, VA; Farm Credit of the Virginias of Staunton, VA; Farm Credit of Southwest Florida of Arcadia, FL; Southwest Georgia of Bainbridge, GA; and AgFirst Farm Credit Bank of Columbia, SC.