Farm Credit is accusing Uncle Nearest of fraud, which includes an attempt to conceal a $20 million loan from Jay-Z, as stated by the Lexington Herald Leader.
Nearest Green Distillery and the flagship Uncle Nearest whiskey brand have been under the management of a receiver since September, after lender Farm Credit Mid-America claimed the Weavers defaulted on more than $108 million in loans.
Farm Credit Mid-America claims that Fawn and Keith Weaver have “egregiously mischaracterized” a $20 million loan from Jay-Z’s venture capital firm, MarcyPen.
Jay-Z loan to Uncle Nearest being questioned
The new filings state that Fawn Weaver told ARM Credit the $20 million was a loan from Grant Sidney when it actually came from another source, MP-Tenn LLC, also known as MarcyPen. MarcyPen is a venture capital firm owned by Jay-Z, Jay Brown, Larry Marcus, and Robbie Robinson, along with D’Rita Robinson.
“The Weaver Parties attempt to imply (incorrectly) that FCMA was in no way misled at the time. FCMA was considerably misled,” the bank said.
MarcyPen has also stated that Uncle Nearest is in default on the loan, as per the bank’s filing. The weavers claim that the capital went to Uncle Nearest or related vendors and are asking that Farm Credit’s allegations be “ignored, struck, and dismissed.”
Uncle Nearest’s property listed for sale
Receiver Phillip G. Young Jr listed the business’s Martha’s Vineyard property for sale. Farm Credit Mid-America alleges that Uncle Nearest borrowed $2.3 million for the property, which was purchased through a separate LLC and mortgaged to another lender, in violation of the loan agreements, according to The Spirits Business.
The property was listed for $2.59 million by Young on Jan. 26. A full-price offer was received on Feb. 18, along with two backup offers at the full asking price. Uncle Nearest’s brand allegedly used the property to host private gatherings to expand distributor and industry relationships, according to a court transcript.
The Martha’s Vineyard property is expected to shut on March 19. Young has asked the court to quickly approve the deal.
Subsequently, Young asked to expand the receivership to include 4 Front Street LLC, Grant Sidney Inc, Humble Baron Inc, Nashwood Inc, Quill & Cask Owner LLC, Shelbyville Barrel House BBQ LLC, and Shelbyville Grand LLC in a post-briefing hearing, as stated by the Moore County Observer.
Fawn and Keith Weaver also said that Farm Credit’s allegations have caused “immediate financial and reputational harm,” including vendors stopping business with the company and customers stopping orders.
Image: Uncle Nearest
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