Community Trust and Banking Co. of Ooltewah has sued Cleveland, Tenn., businessmen Steve A. “Toby” McKenzie and Lynn Jones for an alleged default of a $6.5 million loan.
The businessmen obtained the loan on Jan. 25, 2006, along with Specialized Training Facilities LLC, according to the complaint filed in Hamilton County Chancery Court. Specialized Training owns real estate in Marion County that secures the debt, said Thomas Dickenson, a Knoxville attorney representing the bank.
The note was due on May 1, 2008, according to the complaint, and the principal has not been paid. The debtors also owe interest of $180,375 through June 9, late charges of $7,484 and an appraisal fee of $2,500. Interest after June 9 accrues at a rate of $3,250 per day.
Harlon Rice, director of properties for Steve A. McKenzie Cos., said the property in Marion is a former ethanol plant. He said the property is under contract to be sold and he expects the deal to close, but wouldn’t give a closing date.
Separately, next Thursday, Mr. McKenzie is auctioning off the remaining 51 lots in his Hampton Creek subdivision on Snow Hill Road in Ooltewah.
He also is auctioning off more than 500 acres in Bradley County, said Henry Glascock of auctioneer John Dixon & Associates.
Mr. Rice said that tract off Dalton Pike, called Maple Hill Farms, was to be developed. But with the real estate market slowing down, he said they decided not to do so.
The Hampton Creek auction will be held at the subdivision’s clubhouse, while the Bradley auction will be held on site. More information is at www.johndixon.com.
“He is trying to reduce as much of his real estate inventory as possible to move on to other projects and reduce debt,” Mr. Glascock said.