Settlement Talks Bring Halt to Wortman-Ferguson Dispute After 3 Days of Testimony

by George Waldon  on Monday, Feb. 7, 2011 12:00 am  

That same year, Ferguson also invited Wortman to invest in the purchase of Pine State Bank of Kingsland, which was moved to Little Rock and renamed Centennial Bank. Both men served as directors of Centennial and both profited handsomely when Centennial was acquired by Home BancShares Inc. of Conway in January 2008.

Another major investor in Centennial Bank was Gene Cauley, then a Little Rock lawyer and now a federal prison inmate. Ferguson, Cauley and Wortman were the three largest shareholders in the bank's holding company, Centennial Bancshares Inc., owning a combined 88 percent stake.

Their respective holdings and estimated payout in the transaction were: Ferguson, 33.26 percent, $8.315 million; Cauley, 32.74 percent, $8.185 million; and Wortman, 12.33 percent, $3.083 million.

(Ron Strother also had made the move from Arvest to Home BancShares during that period, and he, too, had bought a house from Ferguson in Valley Falls Estates. He was president and COO of Home BancShares when he killed himself on Jan. 31, 2010.)

Although the Wortmans had moved into their 9,089-SF home on Valley Creek View less than two years earlier, they bought three more Valley Falls lots from Ferguson in 2005 and began in October of that year construction of the house that is now in dispute.

Naturally, the lumber used in the construction was purchased from Kaufman Lumber.

In 2006, according to Wortman's testimony, "Mr. Cauley approached me and wanted to know if I would be interested in selling two-thirds of the ownership of [Kaufman Lumber] to Mr. Ferguson and himself."

That deal, financed entirely by Kaufman Lumber without any cash payments by Ferguson or Cauley, was done in July 2006, with Wortman retaining voting control until his new partners had paid him half of the leveraged debt.

By the time the Wortmans moved into the rambling new house in March 2008, according to Wortman's testimony, his relationship with Ferguson had been damaged because Wortman refused to give Ferguson's brother-in-law a job at Kaufman Lumber and because Ferguson believed Wortman was overcharging him for building material.

Ferguson apparently wanted someone looking out for his interests inside Kaufman, although Wortman denied overcharging him. Wortman was unable to regain Ferguson's trust, and the homebuilder began unwinding his business dealings with Wortman.

That drew retaliation from Wortman.

According to a source in the Ferguson camp, Wortman tried to have Ferguson ousted from the Centennial Bank board in Little Rock, a move made while Ferguson was on a business trip to Dallas.

 

 

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