- 17 - collateral that Towers Development pledge a certificate of deposit in the amount of $208,000, the pledge to remain in effect until the sale of 70 town house units. At some unspecified date, Briggs assigned to AMI a certificate of deposit in the amount of $138,666.66 issued by First American Bank and Trust.15 Towers Development’s Use and Repayment of AMI Loan Proceeds On all its financing agreements with Towers Development, AMI specified that Towers Development was to use the loan proceeds for purposes that included purchasing land and funding the development and construction of phases I and II of the Gulf Highlands project. With respect to the loans to Towers Development, AMI paid the loan proceeds directly to Towers Development. On its corporate books, Towers Development reported the loans as being from AMI and not from shareholders. Towers Development made all loan repayments, including principal and interest, not only on its own loans, but also on AMI’s loans to Briggs and Daniell. Towers Development made payments to AMI as it sold town house units at Gulf Highlands. Neither petitioners nor Daniell made any payments on the AMI loans. AMI never required Briggs or Daniell to honor his personal guaranty or to surrender assets used as collateral for the loans to Towers Development. 15 The record does not explain the apparent discrepancy between the amount of the certificate of deposit as required in the commitment letter and the amount actually assigned by Briggs.Page: Previous 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 Next
Last modified: May 25, 2011