Based on bankruptcy documents, the calculation of the total value of the debt assumed and cash paid by the FOA to acquire the golf course assets was $1,972,398.
First is a bidding document filed by the FOA stating that bidders must agree to pay $1,892,398 based on a schedule (Exhibit 1 for the bidding document), which contains a list of the claims against the bankruptcy estate (e.g. debts) – highlighted in yellow. Included in the schedule is $160,000 in administrative expenses and unsecured creditors. Bidders would overbid above the $160K in $20K increments. The FOA outbid the former golf course owner at $240,000, or $80,000 above the opening bid, as reflected in the Transcript, and then in Findings of Fact Confirming Plan by the Court. Thus, the value of the total bid by the FOA was $1,972,398.
The facts can be summarized as follows:
1. FOA bought all the assets out of bankruptcy for $1,972,398
2. FOA wants the HOA to purchase land upon which the 36 holes sit for $3.3 million.
3. The HOA has not and will not get an appraisal of the fair market value of this land because the golf course is losing money.
Why should the FOA profit $1.4 million for the sale of only part of the assets it acquired?