FIRST UNION NATIONAL BANK OF FLORIDA FILES COMPLAINT AGAINST MARGO NURSERY FARMS, INC.
FIRST UNION NATIONAL BANK OF FLORIDA FILES COMPLAINT AGAINST MARGO NURSERY FARMS, INC. MIAMI, Dec. 31 /PRNewswire/ -- First Union National Bank of Florida (the "bank") has filed a complaint against Margo Nursery Farms, Inc. (the "company"), in the Circuit Court for Dade County, Florida. In the complaint, the bank alleged that the company had breached its loan agreement with the bank. The bank is seeking a judgment for the unpaid principal portion of the loan (approximately $3.6 million), accrued interest, costs and attorney's fees. The company's loan is secured by a mortgage on the company's Miami nursery farm and a security interest in substantially all of the company's assets in Miami. The company intends to vigorously contest this litigation and to file appropriate counterclaims. The actions of the bank arose as a result of significant financial difficulties experienced by the company during the last year. These difficulties were primarily caused by Benlate 50 DF, a defective fungicide manufactured by E.I. DuPont de Nemours & Co., Inc. ("DuPont"). The Benlate contamination has had a substantial, adverse effect on the company's sales, cash flow and operations. Since August 1991, the company's management has devoted most of its time and effort to the preparation of the company's claim against DuPont. These efforts have included frequent meetings with Crawford & Company, an insurance adjuster retained by DuPont, and the development of extensive documentation supporting the company's claim. The company expects to begin serious negotiations with DuPont in early 1992. If the company is unable to successfully resolve its claim against DuPont in the near future, the company may not have sufficient funds to repay the bank. In that event, the company may seek to reorganize under Chapter 11 of the federal bankruptcy laws. -0- 12/31/91 /CONTACT: Michael J. Spector or James F. Brenner of Margo Nursery Farms, Inc., 305-255-0550/ CO: Margo Nursery Farms; First Union National Bank of Fla. ST: Florida IN: SU:
SS -- FL003 -- 2829 12/31/91 12:33 EST
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|Date:||Dec 31, 1991|
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