Three former Osio Cinemas employees who successfully raised more than $76,000 over the summer to reopen the theater must now wait to see how things unfold for the former owner in bankruptcy court.
While 621 people supported their cause, there’s a chance they might need to raise more if the bankruptcy trustee goes ahead and sells expensive projection equipment to settle the outstanding debt.
“I don’t think there’s a possibility that we won’t open,” says Shanneen Kirkpatrick of the new group, Le Prince Cinemas, that’s poised to reopen Osio. “The landlord is on board with us taking over. They’re asking for our input as we get ready to rock and roll.”
Central Coast Cinemas, the partnership that started the theater 11 years ago, stopped paying rent to the building’s owner Green Valley Corp. of Grass Valley in April. On July 20, the theater abruptly closed and stiffed their employees for their final week of pay by declaring bankruptcy and freezing their assets only one day after they issued final payroll.
Bankruptcy court documents show there are more than 50 claims against the cinema totaling $382,680 in debt, including a claim by the Weekly for $1,561.
Ironically, the lead investor of Central Coast Cinemas, Mark Borde, now finds himself awash in cash. His film distribution company, Freestyle Releasing, sold in late October for high-eight figures, Borde confirms. Freestyle Releasing specializes in Christian films, with notable successes being God’s Not Dead (2014) and Woodlawn (2015).
While Borde would not comment directly on the current bankruptcy, more generally he says the proliferation of Netflix, Hulu and other online venues for independent, arthouse and documentary films affected cinema turnout. “We had a very loyal audience, but it was a small audience of people who really love those movies. They might only go once a week; to be successful we needed them to go a few times a week,” he says.
The fear moving forward is that Central Coast Cinemas filed for Chapter 7 bankruptcy, which allows the creditor to liquidate non-exempt assets. Digital projectors purchased a few years ago and listed as assets could be sold to settle debt. Lawyers and representatives of all parties would not comment on specifics. Both lawyers for Central Coast Cinemas and Green Valley Corp. said the final settlement rests with the court and a decision will be made in the coming weeks.
Le Prince Cinemas is working on a new logo for Osio Cinemas, and will have T-shirts made by December for those who contributed. The group cannot sign a lease while bankruptcy proceedings are underway, but once they do they’ll try to get up and running in a few weeks – assuming equipment is still there. Le Prince Cinemas is shooting for an optimistic mid-December opening, but there are still many factors beyond their control.
“In all honesty our intent is to work with them, but they don’t have a lease at this time,” says Patrick Prindle, the Osio’s property manager. “While I know Osio Cinemas has a strong reputation, this is going to be a start-up business and they’ll be really dependent on support.”