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mortgage on White Oak and guaranteed by HG. HG pledged
collateral for the Farm Credit loan. The Farm Credit loan is
payable over 10 years with a fixed schedule for payment of
principal and interest. The total amount of interest to be paid
on the Farm Credit loan is $15,734,293. Closing costs for the
Farm Credit loan were $200,000.
On November 1, 2002, the estate used proceeds from the Farm
Credit loan to pay $9,610,302.91 in Federal estate tax and
$2,805,802.13 in New York estate tax. The estate retained the
rest of the proceeds from the Farm Credit loan to pay
compensation to Bergreen and Davis and certain administration
expenses.
As of February 1, 2004 (the day after the due date for
repayment of the $143 million in notes), the estate was scheduled
to have paid interest on the Farm Credit loan totaling $2,665,850
and principal in the amount of $742,448.47, leaving a principal
balance of $37,257,551.53.
4. Income Tax Returns and Administration Activities in
2003
From March 1999 to January 2003, the estate received
$23,617,031 cash from HG as interest payments on the $143 million
in notes.7 On July 1, 2002, HG gave the estate a $22.9 million
note for unpaid, accrued interest due through January 31, 2002.
7 The estate received $4,705,631 from HG in 2003.
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