The Valley of the Lakes housing and resort area will
refinance a bank loan in time to avoid a sheriff's sale, a manager of the
firm that owns and develops the area said on Tuesday.
Frank M. Cedrone, a managing general partner for CBG
Limited, said his firm completed paperwork to let the refinancing proceed.
"CBG Limited has received a pledge of a bank loan
guarantee in the form of a standby forward takeout comnitment," Cedronc
One local bank president said he didn't know what a
standby forward takeout commitment is, and other bankers he asked were
unfamiliar with the term.
To arrange the commitment, Cedrone said CBG limited
went through a "long and tedious" time of preparing documents.
"If for any reason, preparation of paperwork causes
delays, an irrevocable guarantee will be put in place to assure payment
upon completion and execution of the required documents. This would also
cause cancellation of any foreclosure proceedings," Cedrone said.
The foreclosure sale was scheduled for Sept. 3 by Luzerne
County Sheriff Frank Jagodinski after CBG Limited agreed how much it must
pay to satisfy its loan with First Eastern Bank.
Cedrone doesn't think the plans of PNC Bank Corp. to
take over First Fastern will affect the repayment.
First Eastern loaned $14 million to CBG Limited, a
First Eastern stockholder said in a legal complaint filed against the bank.
Attorney Joseph Solfanelli says in the complaint he
filed that when CBG missed a payment, First Eastern borrowed $1.3 million
to mask the default. The second lender filed for judgment against CBG in
August 1991, the complaint says.
CBG filed for bankruptcy In March 1992.
Cedrone said his company plans to resume development
and full-scale operations 30 days after emerging from Chapter 11 proceedings.
Operations include townhouses and a golf course under
construction, a sewage treatment plant and a ski area that closed for the
winter of 1992-93.