- 15 - possession of the collateral and receive the “rents, incomes, issues, and profits of the Collateral”, to be applied to the amount of the “secured indebtedness”, defined in the agreement by reference to the “indebtedness evidenced by the [real estate] Note in accordance with the terms thereof”. On May 31, 1985, Briggs and Daniell executed a personal guaranty with respect to the line of credit, agreeing that “if the Debt is not paid by * * * [Towers Development] when due, * * * [Briggs and Daniell] will immediately do so.” AMI also intended to require Mr. Morris’ personal guaranty, but because of his past credit problems, his name was struck from all documents. Also on May 31, 1985, Briggs and Daniell executed a mortgage and security agreement in favor of AMI, evidencing the $1.5 million acquisition and development loan for the 40 acres. The loans from AMI to Towers Development and to Briggs and Daniell were cross-collateralized. That is, default under either mortgage would be deemed to constitute a default under the other mortgage, so that AMI could exercise its security interest with respect to the property collateralizing either mortgage. In the event of default on the Towers Development loan, however, AMI was subordinated to Mariners Cove’s security interest in the 40 acres. To secure its mortgage interest with respect to its loans to Towers Development and to Briggs and Daniell, AMI filed twoPage: Previous 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Next
Last modified: May 25, 2011