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No funds are in fact utilized purchasing extra items or solutions, or even build facilities that are additional.

No funds are in fact utilized purchasing extra items or solutions, or even build facilities that are additional.

The larger issue ended up being compared to the $40 million, Great Northern desired to make use of approximately 75 % from it to buy assets the mill currently owned, then instantly funnel the funds back again to the initial loan providers.

“No funds are now utilized to acquire extra items or solutions, or even to build extra facilities. Current assets are changing arms among associated entities,” Roney published to FAME’s board into the memo that is same. Here’s exactly how Cate Street, Stonehenge, and Enhanced accomplished that: First, Cate Street developed a brand new entity called GNP Maine Holdings LLC to get the $40 million investment. That entity then paid the $31.8 million to GNP East Inc., the current Cate Street managed entity that owned the mill, buying the paper devices and gear. Following the deal, GNP East ended up being kept having just the land. (Both entities fundamentally filed for bankruptcy.)

This one called GNP NMTC Finance Co. which then funneled the $31.8 million back to the original lenders, according to documents provided to FAME’s board after selling its equipment to its sister subsidiary, GNP East passed the sale proceeds to another Cate Street controlled entity. The cash changed arms eight times in Enhanced’s percentage of the offer and seven times in Stonehenge’s deal, at the very least to some extent due to the complexity of this U.S. Continue reading