Opinion ID: 797855
Heading Depth: 3
Heading Rank: 1

Heading: m & m

Text: 6 Jennings talked to his two co-shareholders about M & M making a bridge loan to Northern Pole. Jennings proposed to the other shareholders that M & M lend $315,000 to Northern Pole. Although they did not see a reason to go forward with the loan, Jennings's co-shareholders ultimately agreed to do so because Jennings wanted to do it and agreed to be personally responsible for the loan. Jennings's coshareholders knew nothing about Northern Pole and did no investigation. 7 On April 30, 1997, M & M borrowed $315,000 from Town & Country Bank, which M & M in turn lent to Northern Pole. In return, Northern Pole provided M & M with a promissory note for $315,000. The promissory note was short term, with a due date of August 1, 1997. 8 On July 30, 1997, M & M executed an extension for its loan from Town & Country Bank. Additional extensions were signed on October 31, 1997, on January 15, 1998, and on March 15, 1998. Jennings's co-shareholders became increasingly upset about the situation. 9 M & M did not record the transaction in its financial statements prepared by Secretary/Treasurer Moses and the company accountant. M & M did not include the $315,000 loan from the bank as a liability or the Northern Pole promissory note as an M & M asset. When asked why the transaction did not appear in M & M's financial statement, Moses explained that the Town & Country Bank loan would be paid by either Northern Pole, James (who had personally guaranteed the Northern Pole loan), or Jennings.