ASSET PURCHASE AGREEMENT
By and Among
AFI MORTGAGE CORP.,
as Seller,
and
FIRST MORTGAGE INVESTMENT CO.,
as Buyer
Dated February 4, 1997
TABLE OF CONTENTS
1. SALE AND PURCHASE OF ASSETS......................................... 1
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1.1 Sale and Purchase of Assets................................ 1
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1.2 Purchase Price............................................. 1
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1.3 Installment Payments on "Unlocked" Pipeline................ 2
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1.4 Assumption of Certain Obligations.......................... 3
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2. LEASE OF PREMISES................................................... 3
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2.1 Lease Agreement............................................ 3
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3. LEASE OF FURNITURE, FIXTURES AND EQUIPMENT.......................... 3
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3.1 Lease of FF&E.............................................. 3
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3.2 Purchase Option............................................ 3
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4. PURCHASE OF PRODUCTION PLATFORM..................................... 3
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4.1 Production Platform........................................ 3
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5. INDEMNIFICATION..................................................... 4
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5.1 Indemnification............................................ 4
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6. CLOSING............................................................. 4
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6.1 Date, Time, and Place of Closing........................... 4
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6.2 Deliveries by Seller....................................... 4
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6.3 Deliveries by Buyer........................................ 6
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7. REPRESENTATIONS, WARRANTIES, AND COVENANTS.......................... 6
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7.1 Representations, Warranties, and Covenants of Seller....... 6
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7.1.1 Organization, Standing and Corporate Power........ 6
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7.1.2 Corporate Authorization........................... 6
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7.1.3 Conflicting Agreements; No Liens.................. 6
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7.1.4 Consents.......................................... 6
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7.1.5 Title to Assets; Lack of Encumbrances............. 7
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7.1.6 Business Expenses................................. 7
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7.1.7 Delivery of Documents............................. 7
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7.1.8 Disclosure........................................ 7
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7.1.9 No Changes in Assets.............................. 7
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7.1.10 Title and Condition of Assets..................... 7
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7.2 Representations, Warranties, and Covenants of Buyer........ 7
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7.2.1 Organization, Standing and Corporate Power........ 7
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7.2.2 Corporate Authorization........................... 8
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7.2.3 Disclosure................................... 8
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8. ADDITIONAL AGREEMENTS OF THE PARTIES......................... 8
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8.1 Survival............................................ 8
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8.2 Payment of Costs.................................... 8
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8.3 Specific Performance................................ 8
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8.4 Additional Assurances............................... 8
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8.5 Seller's Employees.................................. 8
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9. PRIOR TO CLOSING............................................. 9
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9.1 Access.............................................. 9
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9.2 Conduct of Business Pending Closing................. 9
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9.3 Required Consents and Approvals.................... 10
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10. CLOSING CONDITIONS; RIGHT TO TERMINATE...................... 10
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10.1 Conditions to Buyer's Obligations.................. 10
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10.2 Conditions to Seller's Obligations................. 11
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10.3 Right To Terminate................................. 11
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10.4 Post-Closing Obligations.......................... 11
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11. MISCELLANEOUS............................................... 12
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11.1 Notices............................................ 12
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11.2 Time............................................... 12
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11.3 Law Governing...................................... 12
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11.4 Confidentiality.................................... 12
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11.5 Publicity.......................................... 13
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11.6 Expenses and Attorney Fees......................... 13
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11.7 Entire Agreement; Amendments; Waivers.............. 13
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11.8 Headings........................................... 13
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11.9 Incorporation of Exhibits and Schedules............ 13
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11.10 Binding Effect..................................... 13
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11.11 Parties in Interest................................ 13
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11.12 Counterparts....................................... 13
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EXHIBITS
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Exhibit Assets
Exhibit Obligations
Exhibit Lease Agreement
Exhibit Furniture, Fixtures & Equipment
Exhibit Letter of Intent
ASSET PURCHASE AGREEMENT
------------------------
THIS AGREEMENT, made and entered into the 4th day of February 1997, by and
between FIRST MORTGAGE INVESTMENT CO., a Missouri corporation (hereinafter
referred to as "Buyer"), and AFI MORTGAGE CORP., a Nebraska corporation,
(hereinafter referred to as "Seller").
Recitals
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WHEREAS, Seller is engaged in the business of soliciting, funding, and
selling residential mortgage loans (the "Business").
WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase from
Seller, on the terms and conditions set forth below, the Mortgage Pipeline Loans
(hereinafter referred to as the "Assets") of Seller, as defined in Section
hereof.
WHEREAS, Buyer desires to lease from Seller approximately Ten Thousand
(10,000) square feet of space in the building owned by Seller, as more
specifically described in Exhibit and certain office furniture and equipment, as
described in Exhibit , all on the terms, considerations and conditions set forth
in the Lease Agreement, Exhibit , attached hereto and incorporated herein by
reference.
NOW, THEREFORE, in consideration of the foregoing recitals and the
covenants and agreements herein contained and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties, intending to be legally bound, agree as follows:
Agreement
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1. SALE AND PURCHASE OF ASSETS
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Sale and Purchase of Assets. Subject to the terms and conditions of this
Agreement, Seller hereby agrees to sell, transfer, convey, assign, and deliver
the Assets to Buyer or his assignee, and Buyer hereby agrees to purchase and
acquire the Assets from Seller. As used in this Agreement, the term "Assets"
shall mean Seller's mortgage loans and Seller's remote site contracts as more
specifically described in Exhibit hereto; provided, however the Assets shall not
include any contract not expressly being assumed by Buyer.
Purchase Price. The purchase price for all of the Assets shall be fifty
percent (50%) of the Net Profit of the Pipeline (the "Purchase Price"). The
"Pipeline" shall mean all loans for which an application has been submitted as
of the close of business on the day before Closing. The Purchase Price shall be
paid as follows:
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1.2.1 A down payment on the Date of Closing equal to fifty percent
(50%) of the Net Profit on the "locked" Pipeline. "Locked" Pipeline shall
include those loans where the resale price of the Loan is committed to be paid
by an independent party; and
1.2.2 Fifty percent (50%) of the Net Profit on the "unlocked"
Pipeline. "Unlocked" Pipeline shall include all loans which are not "locked" as
defined above, which shall be paid on an installment basis as described in
Section hereof.
"Net Profit" shall mean, for purposes of this Agreement, (i) the amount loaned
to a customer of the Business plus all fees and points collected less (ii) the
resale proceeds of the loan plus commissions and overages. Neither Buyer nor any
assignee of Buyer's interest hereunder is assuming nor shall either be liable
for any liabilities of Seller, including but not limited to:
1.2.3 any national, state, or local taxes,
1.2.4 any liability arising from or claimed to have arisen from the
operation of the Business prior to the Closing Date, as such term is defined in
Section (the "Closing Date"),
1.2.5 any existing, pending, or threatened litigation against Seller,
or
1.2.6 any existing or future obligation or liability of Seller to any
of its present or former employees for severance pay, back pay, benefits under
any retirement, health insurance, savings, or other form of employee benefit
plan, or otherwise, all of which obligations and liabilities Seller shall
retain.
Seller shall pay all sales, use, stamp, and other transfer and excise taxes of
any type arising out of the transaction contemplated hereunder, whether imposed
on Seller or Buyer.
1.3 Installment Payments on "Unlocked" Pipeline. Buyer shall pay to Seller
its fifty percent (50%) of the Net Profit on any "unlocked" loans, which have
been closed and funded during each calendar month following the Closing, within
three (3) business days of the end of each calendar month. Such payment shall be
made "plus or minus" any necessary adjustments, which shall include, but not be
limited to, repricing or loan buy back. The installment payments shall continue
until there are no loans left in the Pipeline, as defined in Section above.
In the event the Net Profit for a given calendar month results in a loss
which is the result of Seller's actions, Seller shall repay the Buyer one
hundred percent (100%) of such loss amount, or if not repaid within five (5)
business days of the date of demand, the Buyer shall have an express right of
set-off against any other amounts Buyer may owe Seller under this or any other
arrangement between the parties.
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1.4 Assumption of Certain Obligations. Buyer shall have the right, but not
the obligation' to assume any or all of Seller's obligations described hereto on
Exhibit , by delivering to Seller written notice of such election to assume any
or all of such liabilities on or prior to the Closing Date. Failure by Buyer to
give such written notice to Seller shall be deemed an election by Buyer not to
assume any of such liabilities.
2. LEASE OF PREMISES.
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2.1 Lease Agreement. Buyer shall execute the Lease Agreement, Exhibit ,
attached hereto and incorporated herein by reference.
3. LEASE OF FURNITURE, FIXTURES AND EQUIPMENT
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3.1 Lease of FF&E. Buyer shall lease from Seller the furniture, fixtures
and equipment, located on the Leased Premises, as defined in the Lease
Agreement, and as more specifically described in Exhibit , attached hereto and
incorporated herein by reference, for a term of three (3) months beginning
February 3, 1997. The parties may extend the term of the lease for an additional
thirty (30) day period upon the expiration of the initial term of the lease. In
addition, either party may terminate this lease at any time by giving the other
party thirty (30) days prior written notice. Buyer shall pay Seller, as rent, an
amount equal to Fifteen Thousand Dollars ($15,000.00) per month. Each monthly
payment set forth hereinabove shall be due and payable in advance on the third
(3rd) day of each month with the first payment due on February 3, 1997, and on
the third (3rd) day of each and every month thereafter. All rent provided for in
this Section shall be paid or mailed to AFI Mortgage Corp., 0000 Xxxxxxxxxx
Xxxxxx, Xxxxxxx Xxxxxxx, Xxxxxx 00000, or to such other payee or address as
Seller may designate in writing to Buyer.
In the event the Seller fails to make any payments due pursuant to the
underlying leases, as more specifically described in Exhibit hereto, and Buyer
makes such payment on behalf of Seller, Buyer shall have an express right of
set-off against any other amounts Buyer may owe Seller under this or any other
arrangement between the parties.
3.2 Purchase Option. The Seller grants to the Buyer the option to purchase
the furniture, fixtures and equipment for an amount equal to the outstanding
lease or at the appraised value, whichever is greater, at any time after ninety
(90) days from the date of this Agreement.
4. PURCHASE OF PRODUCTION PLATFORM
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4.1 Production Platform. In the event the transaction contemplated by the
Letter of Intent, as shown in Exhibit , attached hereto and incorporated herein
by reference, is not consummated, the Buyer agrees to purchase the Seller's
Production Platform. For purposes of this
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Agreement, the "Production Platform" shall mean all loans originated after
February 1, 1997 which were sourced in one of the "remote sites" identified in
Exhibit hereto and acquired by the Buyer under this Agreement. The purchase
price for the Production Platform shall be one-eighth of a percent (.125%) of
the gross principal amount of all loans in the Production Platform closed during
the twelve month period beginning February 1, 1997 and ending February 1, 1998,
excluding those loans already purchased by Buyer pursuant to this Agreement.
Such amount is to be computed on a monthly basis. In no event shall the total
purchase price exceed One Hundred Twenty-Five Thousand and No/100 Dollars
($125,000.00). The Buyer shall apply any amount of the purchase price due under
this Section on a monthly basis against any amount Seller may owe Buyer pursuant
to the Second Mortgage dated March, 1996 between FMIC, AFI and Advanced
Financial, Inc.
5. INDEMNIFICATION
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5.1 Indemnification. In the event either party breaches (or in the event
any third party alleges facts that, if true, would mean the party had breached)
(the "Indemnifying Party") any of its representations, warranties, and covenants
contained in this Agreement, and, if there is an applicable survival period
pursuant to Section hereof, provided that the party suffering any Adverse
Consequences, the "Indemnified Party," makes a written claim for indemnification
against the Indemnifying Party, the Indemnifying Party agrees to indemnify the
Indemnified Party from and against the entirety of any Adverse Consequences the
Indemnified Party may suffer through and after the date of the claim for
indemnification (including any Adverse Consequences the party may suffer after
the end of any applicable survival period) resulting from, arising out of,
relating to, in the nature of, or caused by misrepresentation or breach (or
alleged misrepresentation or breach). "Adverse Consequences" shall mean any
actions, suites, proceedings, hearings, investigations, charges, complaints,
claims, demands, injunctions, judgments, orders, decrees, rulings, damages,
dues, penalties, fines, costs, amounts paid in settlement, liabilities,
obligations, taxes, liens, losses, expenses, and fees, including court costs and
reasonable attorneys' fees and expenses.
6. CLOSING
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6.1 Date, Time, and Place of Closing. The closing shall take place at the
offices of Xxxxxxxx Xxxxxxx & Xxxxxx, P.C., Twelve Wyandotte Plaza, 120 West
12th Street, Kansas City, Missouri on such date or time or at such other place
as Buyer and Seller may agree in writing (the "Closing Date").
6.2 Deliveries by Seller. At the closing, Seller shall deliver to Buyer:
6.2.1 Seller shall transfer to Buyer all current files, books,
records, accounts receivable records, lists, catalogs, sales promotion
literature, customer and investor lists, employee files, contract files and
other business information and documents used by Seller in connection with the
Assets.
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6.2.2 Seller shall transfer to Buyer any deposit funds held by Seller
for appraisal fees, credit reports or commitment fees collected in connection
with any of the Assets purchased by and assigned to Buyer.
6.2.3 Seller shall deliver duly executed (and acknowledged where
appropriate) assignments, bills of sale, and other appropriate instruments of
transfer as are, in the opinion of counsel for Buyer, effective to vest in Buyer
good and indefeasible title to all of the Assets.
6.2.4 The opinion of Xxxxxxxx & Xxxxxxxxxx, P.C., counsel to Seller,
dated the Closing Date, in form and substance reasonably satisfactory to Buyer,
to the effect that:
(a) Seller is a corporation duly organized and validly existing
in good standing under the laws of Nebraska, and is duly qualified and in good
standing to transact business as a foreign corporation in all jurisdictions
where such qualification is required by reason of the transaction of business in
such jurisdiction by Seller or the ownership of property in such jurisdiction by
Seller, except where the failure to so qualify would not, individually or in the
aggregate, have a material adverse effect on Seller or on the conduct of the
Business;
(b) Seller has duly executed this Agreement and Seller is bound
by the terms of this Agreement in accordance with its terms except as the same
may be limited by any applicable bankruptcy, insolvency, reorganization, or
other laws relating to or affecting creditors' rights generally and general
principles of equity;
(c) all necessary corporate actions have been taken to duly
authorize the execution, delivery, and performance of this Agreement by Seller;
(d) no approval of any court, governmental agency (other than
those described in such opinion which have been obtained and are then in effect)
or, to the knowledge of such counsel, other person, firm, or other entity is
required in order that this Agreement may be lawfully and validly consummated;
(e) neither the execution and delivery of this Agreement nor the
performance hereof in accordance with its terms is restricted by or in violation
of the terms of Seller's articles or certificate of incorporation, bylaws, or
other charter documents or of any contract, mortgage, indenture, order, decree,
or other contractual obligation of Seller, as regarding consent to transfer or
to which Seller or any of the Assets may be subject; and
(f) the instruments of transfer delivered to Buyer by the Seller
are sufficient in form to convey to Buyer good and merchantable title to all of
the Assets conveyed thereby.
6.2.5 A detailed list and description of all furniture, fixtures and
equipment, Exhibit , to be leased by Buyer pursuant to this Agreement; and
5
6.2.6 All termination statements and other form of lien releases, duly
executed and in form and substance satisfactory to Buyer, required to terminate
and release all security interests and liens on the Assets.
6.3 Deliveries by Buyer. At the Closing, Buyer shall deliver to seller:
6.3.1 A check payable to Seller in the amount of the Purchase Price,
net of any amounts assumed by Buyer pursuant to Section .
6.3.2 Lease Agreement, substantially in the form of Exhibit hereto.
7. REPRESENTATIONS, WARRANTIES, AND COVENANTS
7.1 Representations, Warranties, and Covenants of Seller. Seller hereby
represents, warrants, and agrees to and with Buyer as follows:
7.1.1 Organization, Standing and Corporate Power. Seller is a
corporation, duly organized, validly existing and in good standing under the
laws of its state of incorporation, with all requisite corporate power and
authority to carry on its business as now conducted, to own the Assets, and to
execute, deliver and perform this Agreement.
7.1.2 Corporate Authorization. The execution, delivery and performance
of this Agreement and the consummation of the transaction contemplated hereby
have been duly and validly authorized by all necessary corporate action on the
part of Seller, and this Agreement is a valid and legally binding obligation of
Seller, enforceable in accordance with its terms.
7.1.3 Conflicting Agreements; No Liens. Neither the execution and
delivery of this Agreement by Seller nor the fulfillment of or compliance with
the terms or provisions hereof will result in a breach of the terms, conditions
or provisions of or constitute (whether or not with the giving of notice or
lapse of time, or both) a default under or result in a violation of the charter
or by-laws of Seller or any agreement, contract, instrument, order, judgment or
decree to which Seller is a party or by which it is bound, or violate any
provision of any applicable law, statute, rule or regulations or any order,
decree, writ or injunction of any court of governmental body, or result in the
creation of any charge, lien, restriction, security interest or other
encumbrance of any nature whatsoever on any of the Assets, or impose a condition
on or render void or ineffective the sale or assignment to Buyer of any of the
Assets. On the Closing Date, none of the Assets will be subject to any lien,
charge, mortgage, security interest, or encumbrance.
7.1.4 Consents. No consent form, or other approval of, any court,
governmental body or any other person is necessary in connection with the
execution, delivery or performance of this Agreement by Seller, other than
consents and approvals which have already been obtained, and
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other than the approval of the Bankruptcy Court, and the consummation of the
transactions contemplated by this Agreement will not require the approval of any
entity or person in order to prevent the termination of any right, privilege,
license or agreement of Seller which is necessary for the conduct of the
Seller's Business.
7.1.5 Title to Assets; Lack of Encumbrances. Seller has and will
deliver to Buyer good and marketable title to (or, in the case of leased
property, valid leasehold interests in), all of the Assets, real and personal,
tangible and intangible, free and clear of all liens, mortgages and other
encumbrances and claims of any kind or character, except, in the case of the
leasehold, the rights of the Lessor.
7.1.6 Business Expenses. Seller shall pay all expenses attributable to
the Business through the Closing Date, including, but not limited to, payment of
salaries and loan officers' commissions, health insurance, social security taxes
and other such expenses.
7.1.7 Delivery of Documents. True copies of all written instruments
listed on the Exhibits hereto have been made available to Buyer. Seller also has
made and will continue to make available to Buyer all books and records (if any)
retained by Seller and relating to the Business.
7.1.8 Disclosure. None of the representations or warranties in this
Agreement, in any document, written statement, certificate or schedule furnished
or to be furnished to Buyer pursuant to this Agreement or in connection with the
transactions contemplated hereby contains or will contain any untrue statement
of any material fact, or omits or will omit to state any material fact necessary
to make the statement of facts contained therein not misleading.
7.1.9 No Changes in Assets. Seller has not
(a) sold, leased, mortgaged, pledged, hypothecated, transferred,
or disposed of any of the Assets; or
(b) suffered any material adverse change in the Assets.
7.1.10 Title and Condition of Assets. Seller has good and merchantable
title to all of the Assets.
7.2 Representations, Warranties, and Covenants of Buyer. Buyer represents,
warrants, and agrees to and with Seller as follows:
7.2.1 Organization, Standing and Corporate Power. Buyer is a
corporation, duly organized, validly existing and in good standing under the
laws of the State of Missouri, with all requisite corporate power and authority
to execute, deliver and perform this Agreement.
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7.2.2 Corporate Authorization. The execution, delivery and performance
of this Agreement and the consummation of the transaction contemplated hereby
have been duly and validly authorized by all necessary corporate action on the
part of Buyer, and this Agreement is a valid and legally binding obligation of
Buyer, enforceable in accordance with its terms.
7.2.3 Disclosure. None of the representations or warranties in this
Agreement, in any document, written statement, certificate or schedule furnished
or to be furnished to Seller pursuant to this Agreement or in connection with
the transactions contemplated hereby contains or will contain any untrue
statement of any material fact, or omits or will omit to state any material fact
necessary to make the statement of facts contained therein not misleading.
8. ADDITIONAL AGREEMENTS OF THE PARTIES
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8.1 Survival. The representations and warranties of the parties herein and
all agreements assumed or undertaken pursuant to this Agreement shall survive
the closing, any investigation by or on behalf of any party to this Agreement,
and the delivery of transfer documents contemplated hereby; provided, however,
such representations and warranties shall expire and be of no further force and
effect following a period commencing on the Closing Date and ending five (5)
years from the Closing Date.
8.2 Payment of Costs. Buyer and Seller shall share on a 50/50 basis all
costs and expenses incurred or to be incurred in negotiating and preparing this
Agreement and in closing and carrying out the transactions contemplated by this
Agreement.
8.3 Specific Performance. Seller acknowledges that the Assets to be sold
and delivered to Buyer pursuant to this Agreement are unique and that Buyer may
have no adequate remedy at law if any party shall fail to perform any of its
obligations under this Agreement. ln such event, Buyer shall have the right, in
addition to any other rights and remedies it may have at law or in equity, to
specific performance of this Agreement.
8.4 Additional Assurances. Each party hereto agrees to promptly execute,
acknowledge, and deliver to any other party hereto, on or after the Closing
Date, such additional deeds, bills of sale, assignments, documents,
certificates, instruments, or agreements and to promptly take such other action
as the party requesting the same may reasonably request in order to more fully
effectuate and consummate the transactions contemplated by this Agreement and
the transfer of and payment for the Assets.
8.5 Seller's Employees. Buyer does not promise to employ any of the current
employees of Seller. Seller shall preserve and make available to Buyer the
personnel files on each of Seller's employees who are employed by Buyer.
8
9. PRIOR TO CLOSING
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9.1 Access. During the period from the date of this Agreement to the
Closing Date, Seller shall cause Buyer to be given free access to the Assets and
to Seller's offices and other premises, records, files, books of account,
contracts, commitments, insurance policies, surety bonds, leases, and copies of
tax returns of Seller for the purpose of conducting an investigation of the
Assets through Buyer's employees or agents, independent public accountants,
outside business consultants, and attorneys; provided, however, that such
investigation shall be conducted in a manner that does not unreasonably
interfere with Seller's normal operations and employee relationships. Seller
shall cause its personnel to assist Buyer in making such investigation and shall
cause its counsel, accountants, employees, and other representatives to be
available to Buyer for such purposes. During such investigation, Buyer shall
have the right to make copies of such records, files, and other materials as it
may deem advisable. If the transactions contemplated by this Agreement are not
consummated as provided herein, Buyer and its representatives shall treat all
information obtained in such investigation and not otherwise known to Buyer, or
already in the public domain, as confidential shall return to Seller all copies
made by Buyer and its representatives of material belonging to Seller and shall
not use any such information for any purpose whatsoever.
9.2 Conduct of Business Pending Closing. During the period from the date
hereof to the Closing Date, Seller shall conduct its Business operations with
respect to the Assets according to its ordinary and usual course of business and
shall maintain its records and books of account in a manner that fairly reflects
its financial transactions with respect to the Assets. Seller agrees that during
such period it shall not, in its operation of the Assets, without the written
consent of Buyer:
9.2.1 Pay or incur any obligation or liability, absolute or
contingent, other than current liabilities incurred in the ordinary and usual
course of business;
9.2.2 Mortgage, pledge, or, other than in the ordinary and usual
course of the Business, subject to lien or other encumbrance any of the Assets;
9.2.3 Except in the ordinary and usual course of the Business, sell,
or transfer any of its properties or assets or cancel, release, or assign any
indebtedness owed to it or any claims held by it;
9.2.4 Make any material change or decrease in its Business insurance,
advertising, or employment commitments or arrangements, or enter into or amend
(a) Any contract for the purchase of supplies or inventory other
than such contracts incurred in the ordinary and usual course of business;
(b) Any employment, management, or consultation agreement;
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(c) Any lease, license, royalty, or union agreement; or
(d) Any other agreement not in the ordinary and usual course of
business; or
9.2.5 Enter into any transaction or agreement or take any other action
which would, if effected prior to the Closing Date, constitute a breach of any
of the representations, warranties, or covenants contained in this Agreement.
9.3 Required Consents and Approvals. The Seller shall obtain all necessary
consents and approvals in order to enable Seller to assign and transfer to Buyer
the Assets.
10. CLOSING CONDITIONS; RIGHT TO TERMINATE
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10.1 Conditions to Buyer's Obligations. Each and every obligation of Buyer
to Seller hereunder to be performed on the Closing Date shall be subject to the
satisfaction of each of the following conditions, occurrence of which may,
except for approvals and consents required by laws, at the option of Buyer, be
waived:
10.1.1 The representations and warranties of Seller contained in this
Agreement shall all be true in all material respects on or as of the Closing
Date, with the same effect as though such representations and warranties had
been made or given on and as of the Closing Date;
10.1.2 The Assets, taken as a whole, shall not have been materially
adversely affected in any way as a result of fire, explosion, earthquake,
disaster, accident, any action of any governmental authority, flood, storms,
embargo, riot, civil disturbance, uprising activity of armed forces, or acts of
God or public enemies;
10.1.3 Seller shall have performed and complied in all material
respects with all of its obligations under this Agreement which are to be
performed or complied with by it prior to or on the Closing Date;
10.1.4 There shall not be pending or threatened any litigation
challenging the lawfulness of the transactions contemplated hereby or seeking to
enjoin or restrain the consummation of this Agreement;
10.1.5 Seller shall have obtained (and Seller hereby agrees to exert
reasonable efforts to obtain) the valid consent of all parties whose consent is
required to the transfer and assumption of any contracts, leases or other Assets
where the failure to obtain such consent would have a material adverse effect on
the intended business of Buyer or its assignee;
10.1.6 Seller shall have delivered all documents required to be
delivered by it to Buyer at the Closing;
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10.1.7 Buyer and its counsel shall be reasonably satisfied that all of
the foregoing conditions have occurred and are continuing; and
10.2 Conditions to Seller's Obligations. Each and every obligation of
Seller to be performed on the Closing Date shall be subject to the satisfaction
of each of the following conditions, occurrence of which may, except for
approvals and consents required by law, at the option of Seller, be waived:
10.2.1 The representations and warranties of Buyer contained in this
Agreement shall all be true in all material respects on or as of the Closing
Date, with the same effect as though such representations and warranties had
been made or given on and as of the Closing Date;
10.2.2 Buyer shall have performed and complied with all of its
obligations to Seller which are to be performed or complied with by it prior to
or on the Closing Date;
10.2.3 There shall not be pending or threatened any litigation
challenging the lawfulness of the transactions contemplated hereby or seeking to
enjoin or restrain the consummation of this Agreement;
10.2.4 Buyer shall have delivered all documents required to be
delivered by it to Seller pursuant to this Agreement at the Closing; and
10.3 Right To Terminate. If each of the conditions set forth above shall
not have occurred and be continuing (for any reason other than default by a
party) and if the transactions contemplated by this Agreement shall not have
been consummated on or before the Closing Date, either Buyer or Seller shall
have the right to terminate this Agreement at any time thereafter without
liability to any other party hereto.
10.4 Post-Closing Obligations. At all times following the Closing Time,
Seller shall promptly deliver to Buyer any payments received by Seller in the
form so received on account or with respect to any of the receivables, accounts,
or other assets being purchased by Buyer hereunder, with such endorsements or
other signatures as may be reasonably requested by Buyer in order for Buyer to
promptly realize payment of such items.
In addition, Seller agrees to pay to Buyer for providing Post-Closing Services
on loans that have been closed by Seller, an amount equal to Four Thousand and
No/100 Dollars ($4,000.00) which shall be netted against the final payment to
Buyer of the outstanding Mortgage Pipeline Loans. For purposes of this Section,
"Post-Closing Services" shall include all the required procedures to deliver
loans to third party investors until the loan is funded by such investor and all
procedures required to complete all quality control procedures necessary to have
a completed loan as required by investor guidelines.
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11. MISCELLANEOUS
-------------
11.1 Notices. Any notices or other communications required or permitted
hereunder shall be in writing, and shall be deemed to have been duly given on
the date of service if served personally on the party to whom notice is to be
given, or on the fifty (5th) day after mailing if mailed to the party to whom
notice is to be given by first class mail, or upon delivery if by registered
mail, return receipt requested, postage prepaid and properly addressed as
follows:
If to Seller: AFI Mortgage Corp.
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxx Xxxxxxx, Xxxxxx 00000
With copy to: Xxxxxxxx & Xxxxxxxxxx, P.C.
Regency Westpointe
00000 Xxxxxxx Xxxxxxx Xxxxx
Xxxxx 000
Xxxxx, Xxxxxxxx 00000-0000
Attn: Xxxx Xxxxxxxx
If to Buyer: First Mortgage Investment Co.
0000 Xxxx 00xx Xxxxxx
Xxxxxxx Xxxxxxx, Xxxxxx 00000
With copy to: Xxxxxxxx Xxxxxxx & Xxxxxx, P.C.
Twelve Wyandotte Plaza
000 Xxxx 00xx Xxxxxx
Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Any party may change the address to which notices and other communications
hereunder are to be delivered by giving the other party notice in the manner
herein set forth.
11.2 Time. Time is of the essence of this Agreement.
11.3 Law Governing. This Agreement shall be construed in accordance with
and governed by the laws of the State of Kansas.
11.4 Confidentiality. Except as may be required to comply with applicable
law and regulations or to obtain required regulatory approvals to consummate
this transaction, the parties hereto shall each use their best efforts to keep
confidential any and all information relating to this transaction and to one
another and will instruct their officers, employees and other representatives
12
having access to such information of such obligations of confidentiality. In the
event the transactions contemplated herein are not consummated, each of the
parties hereto shall return all documents, including any copies thereof, to the
party which provided the same.
11.5 Publicity. Each party hereto will advise, confer with and obtain the
prior written consent of the other, prior to the issuance of any reports,
statements or releases to the media or otherwise pertaining to this transaction
or the implementation thereof.
11.6 Expenses and Attorney Fees. Except to the extent otherwise provided in
this Agreement, each party shall be responsible for all expenses and attorney's
fees incurred by it in performing its obligations under this Agreement. In the
event of any suit, action or proceeding brought by any party for the breach of
any term hereof, or to enforce any provisions hereof, the prevailing party shall
be entitled to reasonable attorney's fees in addition to court costs and other
expenses of litigation as allowed by law.
11.7 Entire Agreement; Amendments; Waivers. This Agreement (including the
documents referred to herein) constitutes the entire Agreement between the
Parties and supersedes any prior understandings, agreements, or representations
by or between the Parties, written or oral, to the extent they related in any
way to the subject matter hereof. No supplement, modification or waiver of this
Agreement shall be binding unless executed in writing by the parties to be bound
hereby. No waiver of any default, misrepresentation, or breach of warranty or
covenant hereunder, whether intentional or not, shall be deemed to extend to any
prior or subsequent default, misrepresentation, or breach of warranty or
covenant hereunder or affect in any way any rights arising by virtue of any
prior or subsequent such occurrence.
11.8 Headings. The section headings contained in this Agreement are
inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
11.9 Incorporation of Exhibits and Schedules. The Exhibits and Schedules
identified in this Agreement are incorporated herein by reference and made a
part hereof.
11.10 Binding Effect. All of the terms and provisions of this Agreement
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective transferees, successors and assigns. No party may assign either
this Agreement or any of its rights, interests, or obligations hereunder without
the prior written approval of the other party.
1.11 Parties in Interest. Notwithstanding any other provision of this
Agreement, this Agreement shall not create any rights or benefits on behalf of
any employee, creditor, third party or other person, and this Agreement shall be
effective only as to the parties hereto, their successors and assigns.
11.12 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same instruments.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered on their behalf on the date first above written.
AFI MORTGAGE CORP., as Seller
ATTEST:
By:
---------------------------------------
------------------------- Name:
Secretary ------------------------------------
Title:
------------------------------------
FIRST MORTGAGE INVESTMENT CO., as Buyer
ATTEST:
By:
--------------------------------------
------------------------- Name:
Secretary ------------------------------------
Title:
-----------------------------------
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EXHIBIT 1.1
ASSETS
1. All mortgage pipeline loans.
2. All rights to the remote site contracts, including all information
necessary to operate the remote site computer network.
15
EXHIBIT 1.4
OBLIGATIONS
None.
16
EXHIBIT 2.1
LEASE AGREEMENT
17
EXHIBIT 3.1
FURNITURE, FIXTURES & EQUIPMENT
18
EXHIBIT 4.1
LETTER OF INTENT
19
