PURCHASE AND SALE AGREEMENT between Matterhorn Financial Services, LLC, as Seller - and - North Star Capital Acquisition LLC , as Buyer Dated and Effective as of January 8, 2010
EXHIBIT
10.2
between
Matterhorn
Financial Services, LLC,
as
Seller
-
and -
North
Star Capital Acquisition LLC ,
as
Buyer
Dated and
Effective as of
January
8, 2010
THIS
PURCHASE AND SALE AGREEMENT (the "Agreement") is entered into this 8th day of
January, 2010, by and between Matterhorn Financial Services, LLC, a California
limited liability company, with an office and principal place of business at
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
("Seller") and North Star Capital Acquisition LLC, a Minnesota LLC with an
office and principal place of business at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Buyer").
WITNESSETH:
WHEREAS,
Seller desires to sell certain Accounts (as defined herein) which Seller owns or
has the legal right to sell; and
WHEREAS,
Buyer desires to buy those Accounts for the consideration and under the express
terms, provisions, conditions and limitations as set forth herein;
and
WHEREAS,
Seller is willing, subject to the express terms, provisions, conditions,
limitations, waivers and disclaimers as may be expressly set forth herein, to
sell, transfer, assign and convey to Buyer all of Seller's right, title and
interest, in, to and under the Accounts; and
WHEREAS,
Seller is agreeing to enter into this Agreement conditioned upon Performance
Capital Management, LLC (“PCM”), the parent entity of Seller, entering into an
Agreement Regarding Loan with Värde Investment Partners, LP (“Värde”) with
respect to that certain Master Loan Agreement by and among Värde, PCM and Seller
dated June 10, 2004, as amended.
NOW,
THEREFORE, in consideration of the mutual promises herein set forth and other
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Seller and Buyer agree as follows:
ARTICLE
I
DEFINITIONS
Section
1.1 For
purposes of this Agreement, the following terms shall have the meanings
indicated:
(a) "Account"
means each and any of the consumer credit card agreements, consumer loans, and
insufficient fund checks, and all supplements and amendments thereto, to be sold
by Seller to Buyer under the terms, conditions, and provisions of this Agreement
and includes for each of the Accounts, all obligations owed to Seller from each
Obligor with respect to each Account all rights, powers, liens or security
interests of Seller with respect to any such Account, and the interest of Seller
in any litigation or bankruptcy to which Seller is a party or claimant relating
to any of the Accounts.
(b) "Account
Balance" means the unpaid principal balance, interest and fees owed on any
individual Account as of the applicable Cutoff Date less any payments received.
The Account Balance may also include pre-charge-off accrued interest and/or
fees. Should any payments be received by Seller post closing, such payments
should be endorsed to Buyer.
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(c) "Account
Documents" means, to the extent available, the original or any copy (including
any microfilm, microfiche, photocopy or machine-readable format) of credit card
applications, terms and conditions, statements, notes, loans account histories,
insufficient fund checks along with any bank notifications, if
available.
(d) "Accounts
Schedule" means the schedule, in electronic form, in a form similar to the
attached Exhibit A,
which is incorporated herein by reference, setting forth the following
information for each Account: the Account number(s), if any, for Seller, the
name of the primary Obligor, and the Account Balance.
(e)
"Agreement" means this Purchase and Sale Agreement, including the cover page and
all Addenda, Exhibits and Schedules hereto.
(f) "Allocated
Account Price" means the individual price of any Account sold hereby which is
calculated as the product of the Purchase Price Percentage and the Account
Balance for such Account sold hereby.
(g) "▇▇▇▇
of Sale and Assignment of Accounts" means the document to be signed and
delivered to Buyer on the Closing Date, in accordance with Section 2.2 herein,
with respect to the Accounts purchased under this Agreement, substantially in
the form attached hereto and incorporated herein by reference as Exhibit
B.
(h) "Business
Day" means any day on which Seller is open for business other than a Saturday, a
Sunday or a federal holiday.
(i)
"Claim" means any claim, demand or legal proceeding.
(j) “Closing
Date” shall mean the date when all of the conditions to Closing as provided
herein have been met. The Closing Date shall take place during normal business
hours on or before January 8, 2010. The closing shall occur at Seller’s
principal place of business located at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. If the parties elect in writing five (5) days prior to
the Closing Date to effectuate the closing through escrow or a title company,
then the Closing shall occur telephonically through the escrow.
(k) "Computer
File" means the computer file or files to be sent by e-mail or Federal Express
priority delivery by Seller to Buyer upon Closing Date. The file shall be in a
mutually acceptable electronic format, and shall contain Account-specific
information for each of the Accounts sold hereby. The Seller will use
commercially reasonable efforts to ensure the accuracy, integrity, and
completeness of the data. The Computer File shall include, but shall not be
limited to, the following fields to the extent reasonably available as of the
Closing Date: (i) Account Balance; (ii) payoff balance; (iii) account number;
(iv) name, last known address and last known phone number of the primary Obligor
(and co-borrowers or guarantors); (v) social security number of the primary
Obligor (and co-borrowers or guarantors); (vi) date of last payment; (vii) last
payment amount; (viii) interest rate; (ix) charge-off date; (x) open date; (xi)
NSF fees; and (xii) post-charge-off payment history by month.
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(l)
"Cutoff Date" means January 4, 2010 for delivery of the Accounts purchased by
Buyer.
(m) “Funding
Date” means payment of the Purchase Price by Buyer to Seller on the Closing
Date.
(n) "Issuer"
means the entity which originated an Account, if the Seller did not originate
such Account.
(o)
"Obligor" means the current and unreleased obligor(s) on an Account, including,
without limitation, any and all co-makers, guarantors, judgment debtors or other
persons or entities liable on the Account.
(p) "Prior
Owner" means the entity which owned the Account immediately preceding Seller, if
applicable.
(q)
"Purchase Price" means the Purchase Price Percentage multiplied by the aggregate
Account Balances or $1,575,425.36.
(r)
"Purchase Price Percentage" means 0.5406485%.
(s) "Transfer
Documents" means the ▇▇▇▇ of Sale and Assignment and such other documents as
Seller and Buyer reasonably agree are necessary, proper or appropriate for the
legal transfer of Seller's right, title and interest in and to the Accounts
purchased pursuant to this Agreement.
(t)
"Wire Transfer Instructions" means the instructions for wire transferring any
portion of the Purchase Price as set forth on Exhibit D attached
hereto.
ARTICLE
II
PURCHASE
AND SALE OF THE ACCOUNTS
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Section
2.1
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Agreement to Sell and
Purchase Accounts. Seller agrees to sell, and Buyer agrees to
purchase, the Accounts described in the applicable Accounts Schedule,
which is attached hereto and incorporated herein by reference as Exhibit A,
subject to the terms, provisions, conditions, limitations, waivers and
disclaimers set forth in this
Agreement.
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Section
2.2
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Agreement to
Assign/Buyer's Right to Act. After Seller's receipt of the Purchase
Price, on the Closing Date, Seller shall deliver to Buyer a ▇▇▇▇ of Sale
and Assignment in the form attached hereto as Exhibit B,
executed by an authorized representative of Seller, which ▇▇▇▇ of Sale and
Assignment shall sell, transfer, assign, set-over, quitclaim and convey to
Buyer all right, title and interest of Seller in and to each of the
Accounts sold and the proceeds of the Accounts received by Seller, if any,
from and after the Closing Date. The ▇▇▇▇ of Sale and Assignment shall
have the same effect as an individual and separate ▇▇▇▇ of sale and
assignment of each and every Account referenced therein. Buyer shall be
responsible at its own expense for the recording and/or filing of the
originals of any such assignments as it deems necessary or appropriate in
its sole discretion. Buyer shall have no right to communicate with any
Obligor or otherwise take any action with respect to any Account or any
Obligor until after the Closing Date. Wire instructions for the transfer
of the Purchase Price by Seller to Buyer on the Closing Date are attached
hereto as Exhibit
E.
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Section
2.3
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Accounts
Schedule. Seller will provide an Accounts Schedule similar in form
to the attached Exhibit A
hereto on the Closing Date, which will be attached to the ▇▇▇▇ of Sale and
Assignment of Accounts after Seller's receipt of the Purchase
Price.
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Section
2.4
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Purchase
Price/Payment. On the Closing Date, and as a condition to Closing,
the Purchase Price shall be paid to Seller by Buyer on or before 5:00 p.m.
Eastern Time in United States Dollars by wire transfer of immediately
available funds in accordance with the Wire Transfer
Instructions.
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Section
2.5
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Payments
Received/Adjustments to Purchase Price. To the extent that the
Seller has received any payments or other consideration distributed or
paid by or on behalf of an Obligor on or prior to the Closing Date, Seller
has reduced the Account Balance of such Account for purposes of
calculating the Purchase Price. Buyer shall be entitled to a refund of the
Purchase Price Percentage times the payment amount to the extent such
Account Balance did not reflect a reduction for such
payment.
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Section
2.6.
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Delivery of
Post-Closing Date Payments. If Seller shall receive any payments or
other consideration distributed or paid by or on behalf of any Obligor
with respect to the Accounts after the Closing Date, Seller shall pay over
and/or deliver such payments or other consideration to Buyer (without
interest thereon from Seller) on or within thirty (30) days of receipt of
such amounts and, if deemed necessary or appropriate by Seller, with an
endorsement in the form substantially as follows: "Pay to the order of
[Buyer] without representations, warranties, and without recourse." Seller
shall indicate on the records related to any of the Accounts transmitted
to Buyer with the payment remittances the account number, the date of
receipt of the payment, the amount of the payment and any other detail
required to allow Buyer to properly post the payments to its collection
system. If Seller has deposited payments received from any Obligor and
issues a check or payment therefor to Buyer, Buyer shall retain the risk
that any such payment so deposited by Seller shall be returned due to
insufficient funds. Seller shall have a period of thirty (30) days after
the date Seller delivers to Buyer payments made by or on behalf of any
Obligor on or after the Closing Date, to notify Buyer in writing that any
such payments were returned due to insufficient funds and specifying the
amount thereof, whereupon Buyer shall immediately, and not later than
thirty (30) days following receipt of such notice, pay to Seller the
amount of such payment by cashier's or certified check and identifying
thereon this Agreement.
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ARTICLE
III
TRANSFER
OF ACCOUNTS AND DOCUMENTS
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Section
3.1
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Delivery of Account
Documents. Seller shall provide Account Documents to Buyer within
fifteen (15) Business Days following the Closing
Date.
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Section
3.2
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Pending Legal
Proceedings. Except as otherwise disclosed by Seller in writing to
Buyer, no Account sold hereunder is subject to any known legal proceedings
as of the Closing Date.
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Section 3.3
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Collection/Contingent
Fees. No Account sold hereunder is subject to third-party
collection or contingency fees as of the Closing Date with the exception
of any accounts assigned to collection attorneys through Trak America or
Seller.
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Section
3.4
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Apportionment of
Costs. Seller shall be responsible for any routine costs, fees or
expenses incurred by it in connection with its ownership or collection of
the Accounts prior to the Closing Date. Buyer shall be responsible for any
costs, fees or expenses incurred by it in connection with its ownership or
collection of the Accounts on and after the Closing Date. Except as
otherwise specifically provided in this Agreement, each party will be
responsible for all fees, costs and expenses which it incurs in connection
with the negotiation, execution, delivery and performance of this
Agreement and the transactions contemplated
hereby.
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Section
3.5
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Affidavit. On
the Closing Date, Seller agrees to execute an affidavit (as required by
the New York Civil Courts, effective September 1, 2009) as to the sale of
the related Charged-off Accounts in the form attached hereto and
incorporate by reference herein as Exhibit
D.
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ARTICLE
IV
COLLECTION
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Section
4.1
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Use of Seller's
Name. Buyer will not use or refer to the name of Seller (or Prior
Owner or Issuer, if applicable) and will not portray itself as Seller's
agent, partner, or joint venturer with respect to the Accounts, or as the
agent, partner or joint venturer of Prior Owner or Issuer, if applicable.
However, Buyer may use the name of Seller (and/or Issuer, if applicable)
for purposes of identifying an Account in communications with the Obligors
in order to collect amounts outstanding on the Accounts, and as reasonably
necessary in any offering materials relating to the Accounts. In
contacting an Obligor, filing suit, or selling Accounts, Buyer will not
state or represent in any way that Buyer is contacting the Obligor, filing
suit or selling loans for or on behalf of Seller (or Prior Owner or
Issuer, if applicable) or that any of the above will take any action with
regard to the Account or the
Obligor.
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Section
4.2
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Reporting to Credit
Bureaus. Seller will report the Accounts to the appropriate credit
reporting agencies as sold/transferred. Except as required by law, Seller
shall have no further obligation with respect to credit
reporting.
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ARTICLE
V
NO
OBLIGATION TO REPURCHASE ACCOUNTS
Buyer is
purchasing the Accounts “as is” and Seller shall not be responsible for
repurchasing or obligated to repurchase any accounts.
REPRESENTATIONS,
WARRANTIES AND COVENANTS OF BUYER
Buyer
hereby represents, warrants and covenants in accordance with Buyer’s actual
knowledge, as of the Closing Date, as follows:
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Section
6.1
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Independent
Evaluation. Buyer warrants and represents that it is a
sophisticated investor, has knowledge and experience in financial and
business matters that enable it to evaluate the merits and risks of the
transaction contemplated by this Agreement, and that its bid for and
decision to purchase the Accounts pursuant to this Agreement is and was
based upon the Buyer's own independent evaluation of information deemed
relevant to Buyer, and of the information and representations, warranties,
and covenants herein made available by Seller or Seller's personnel,
agents, representatives or independent contractors to Buyer, which Buyer
acknowledges and agrees were made available to it and which it was given
the opportunity to inspect to its complete satisfaction. Buyer has relied
solely on its own investigation and it has not relied upon any oral or
written information provided by Seller or its personnel, agents,
representatives or independent contractors. Buyer acknowledges and agrees
that no employee, agent, representative or independent contractor of
Seller has been authorized to make, and that Buyer has not relied upon,
any statements other than those specifically contained in this Agreement.
Buyer acknowledges that Seller has attempted to provide accurate
information to all prospective bidders but that Seller does not represent,
warrant or insure the accuracy or completeness of any information or its
sources of information contained in the materials submitted to Buyer or
any other bidders. Buyer has made such independent investigations as it
deems to be warranted into the nature, validity, enforceability,
collectibility, and value of the Accounts, and all other facts it deems
material to its purchase and is entering into this transaction solely on
the basis of that investigation and the Buyer's own
judgment.
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Section
6.2
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Authorization.
Buyer, and the undersigned representative of Buyer, acting individually
represent and warrant that Buyer is duly and legally authorized to enter
into this Agreement and has complied with all laws, rules, regulations,
charter provisions and bylaws to which it may be subject and that the
undersigned representative is authorized to act on behalf of and bind
Buyer to the terms of this
Agreement.
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Section
6.3
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Binding
Obligations. This Agreement and all of the obligations of Buyer
hereunder are the legal, valid and binding obligations of Buyer,
enforceable in accordance with the terms of this Agreement, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally.
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Section
6.4
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No Breach or
Default. The execution and delivery of this Agreement and the
performance of its obligations hereunder by Buyer will not conflict with
any provision of any law or regulation to which Buyer is subject or
conflict with or result in a breach of or constitute a default under any
of the terms, conditions or provisions of any agreement or instrument to
which Buyer is a party or by which it is bound or any order or decree
applicable to Buyer, or result in the violation of any law, rule,
regulation, order, judgment or decree to which Buyer or its property is
subject.
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Section
6.5
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Pending
Litigation. There is no proceeding, action, investigation or
litigation pending or, to the best of Buyer's knowledge, threatened
against the Buyer which, individually or in the aggregate, may have a
material adverse effect on this Agreement or any action taken or to be
taken in connection with the Buyer's obligations contemplated herein, or
which would be likely to impair materially its ability to perform under
the terms of this Agreement.
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Section
6.6
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Approvals and
Notices. No consent, approval, authorization, or order of,
registration or filing with, or notice to, any governmental authority or
court is required under federal laws, or the laws of any jurisdiction, for
the execution, delivery, and performance of or compliance by Buyer with
this Agreement or the consummation of any other transaction contemplated
hereby.
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Section
6.7
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Economic Risk.
The transactions contemplated by this Agreement do not involve, nor are
they intended in any way to constitute, the sale of a "security" or
"securities" within the meaning of any applicable securities laws, and
none of the representations, warranties or agreements of Buyer shall
create any inference that the transactions involve any "security" or
"securities". Buyer acknowledges, understands and agrees that the
acquisition of these Accounts involves a high degree of risk and are
suitable only for persons or entities of substantial financial means who
have no need for liquidity and who can hold the Accounts indefinitely or
bear the partial or entire loss of their
value.
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Section
6.8
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Nondisclosure.
Buyer is in full compliance with its obligations under the terms of any
Confidentiality Agreement executed by Buyer to review the information made
available by Seller or its personnel, agents, representatives or
independent contractors to all potential bidders for the Accounts.
Furthermore, Buyer shall keep the terms of the Agreement confidential,
including the fact that it has purchased the Accounts from
Seller. This Section 6.8 shall survive any termination of this
Agreement.
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Section
6.9
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Identity. Buyer
is a "United States person" within the meaning of Paragraph 7701(a)(30) of
the Internal Revenue Code of 1986, as
amended.
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Section
6.10
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Enforcement/Legal
Actions. Buyer covenants, agrees, warrants and represents that
Buyer shall not institute any enforcement or legal action or proceeding in
the name of Seller (or Issuer or Prior Owner, if applicable), or any
subsidiary or affiliate thereof. Buyer further covenants, agrees, warrants
and represents that Buyer shall not make reference to any of the foregoing
entities in any correspondence to or discussion with any particular
Obligor regarding enforcement or collection of the Accounts, except to
identify the subject debt or as necessary to
show the chain of assignments. Buyer also represents, warrants and
covenants that it will comply in all respects with all applicable laws
including, but not limited to, those relating to debt collection
practices, in connection with the Accounts and not to take any enforcement
action against any Obligor which would be commercially unreasonable and
that Buyer will not misrepresent, mislead, deceive, or otherwise fail to
adequately disclose to any particular Obligor the identity of Buyer as the
owner of the Accounts.
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Broker. Buyer
warrants and represents that it has not engaged any broker or agent in
connection with this Agreement or the transactions contemplated by this
Agreement or to which this Agreement relates and Buyer covenants to defend
with counsel approved by Seller and hold harmless and indemnify Seller
from and against any and all costs, expense or liability for any
compensation, commissions and charges claimed against Seller by any broker
or agent based upon a written agreement with Buyer relating to this
Agreement or the transactions contemplated
herein.
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Section
6.12
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Survival. The
representations and warranties set forth in this Article VI shall survive
the closing of the transactions herein
contemplated.
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ARTICLE
VII
REPRESENTATIONS
AND WARRANTIES OF SELLER
Seller
hereby represents, warrants and covenants and in accordance with
Seller’s actual knowledge, as of the Closing Date, as follows:
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Section
7.1
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Authorization.
Seller represents and warrants that Seller is duly and legally authorized
to enter into this Agreement and has complied with all laws, rules,
regulations, charter provisions and bylaws to which it may be subject and
that the undersigned representative is authorized to act on behalf of and
bind Seller to the terms of this
Agreement.
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Section
7.2
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Binding
Obligations. This Agreement and all of the obligations of Seller
hereunder are the legal, valid and binding obligations of Seller,
enforceable in accordance with the terms of this Agreement, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization or
other similar laws affecting the enforcement of creditors' rights
generally.
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Section
7.3
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No Breach or
Default. The execution and delivery of this Agreement and the
performance of its obligations hereunder by Seller will not conflict with
any provision of any law or regulation to which Seller is subject or
conflict with or result in a breach of or constitute a default under any
of the terms, conditions or provisions of any agreement or instrument to
which Seller is a party or by which it is bound or any order or decree
applicable to Seller, or result in the violation of any law, rule,
regulation, order, judgment or decree to which Seller or its property is
subject.
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Section
7.4
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Title to
Accounts. Seller is duly and legally authorized to sell, transfer,
convey and assign its rights, title and interest therein. Seller has not
made any prior assignment, conveyance, transfer or sale of any of its
rights or interests in the
Accounts.
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Section
7.5
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Broker. Seller
warrants and represents that it has not engaged any broker or agent in
connection with this Agreement or the transactions contemplated by this
Agreement or to which this Agreement relates, except __________________,
(the "Loan Sale Advisor") for whose fees Seller shall be solely
responsible in accordance with its agreement with Loan Sale Advisor and
Seller covenants to defend with counsel approved by Buyer and hold
harmless and indemnify the Buyer from and against any and all costs,
expense or liability for any compensation, commissions and charges claimed
against Buyer by any broker or agent based upon a written agreement with
Seller relating to this Agreement or the transactions contemplated
herein.
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Section
7.6
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Survival. The
representations and warranties set forth in this Article VII
shall survive the closing of the transactions herein
contemplated.
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Section
7.7
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To
the best of Seller’s knowledge, each of the Accounts has been maintained
and serviced in compliance with all applicable state and federal consumer
credit laws, including, without limitation, the Truth-in-Lending Act, the
Equal Credit Opportunity Act, and the Fair Credit Billing
Act.
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Section
7.8
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To
the best of Seller’s knowledge, none of the Charged-off Accounts are
subject to pending collection
litigation.
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Section
7.10
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The
due diligence information supplied to Purchaser by Seller concerning the
Accounts to be sold to Purchaser hereunder, is materially true and
accurate to the best of Seller’s
knowledge.
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Section
7.11
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No
IRS Form 1099-C has been issued on any Account to be purchased by
Buyer.
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ARTICLE
VIII
INDEMNIFICATION
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Section
8.1
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Buyer's
Indemnification. From and after the Closing Date, Buyer shall
indemnify and hold Seller and its directors, officers and employees
(“Seller Indemnitees”) harmless against and from any and all liability
for, and from and against any and all losses or damages Seller Indemnitees
may suffer as a result of, any claim, demand, cost, expense, or judgment
of any type, kind, character or nature asserted by any third party (herein
"claims"), including, without limitation, all reasonable expenses incurred
by Seller Indemnitees in investigating, preparing or defending against any
such claims and reasonable attorneys' fees both for such defense and all
costs and expenses incurred by Seller Indemnitees to enforce this
indemnification, which Seller Indemnitees shall incur or suffer as a
result of:
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(i) any
act or omission of Buyer or Buyer's agents, assigns or transferees in connection
with the Accounts and its purchase of the Accounts pursuant to the
Agreement;
(ii) the
material inaccuracy of any of Buyer's representations or warranties
herein;
(iii) the
material breach of any of Buyer's covenants herein; or
(iv) any
claim by any Obligor regarding the origination, servicing, collection or
administration of the Accounts by Buyer or Buyer's agents.
The
obligations of Buyer under this Article VIII shall survive the closing of the
transactions herein contemplated.
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Section
8.2
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Seller's
Indemnification. From and after the Closing Date, Seller shall
indemnify and hold Buyer and its directors, officers and employees (“Buyer
Indemnitees”) harmless against and from any and all liability for, and
from and against any and all losses or damages Buyer Indemnitees may
suffer as a result of, any claim, demand, cost, expense, or judgment of
any type, kind, character or nature asserted by any third party (herein
"claims"), including, without limitation, all reasonable expenses incurred
by Buyer Indemnitees in investigating, preparing or defending against any
such claims and reasonable attorneys' fees both for such defense and all
costs and expenses incurred by Buyer Indemnitees to enforce this
indemnification, which Buyer Indemnitees shall incur or suffer as a result
of:
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(i) any act or omission of Seller or Seller's
agents (but not including any independent contractors such as collection
agencies or attorney or law firms retained to collect Accounts) in connection
with the Accounts and its sale of the Accounts pursuant to the
Agreement;
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(ii)
the material inaccuracy of any of Seller's representations or warranties
herein, (iii) the material breach of any of Seller's covenants herein;
or
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(iv) any
claim by any Obligor regarding the origination, servicing, collection or
administration of the Accounts by Seller or Seller's agents.
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The
obligations of Seller under this Article VIII shall survive the closing of
the transactions herein
contemplated.
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Section
8.3
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Procedure for
Indemnification. Any party seeking indemnification with respect to
a claim or loss shall give prompt written notice thereof to the party
against whom indemnification is sought. Indemnitor shall have the right to
assume the defense of any and all claims for which indemnification is
sought hereunder, and indemnitee agrees to cooperate with indemnitor in
any such defense. If the amount of any claim or loss shall, at any time
subsequent to payment pursuant to this Agreement, be reduced by recovery,
settlement or otherwise, the amount of such reduction, less any expenses
incurred in connection therewith, shall promptly be repaid by the
indemnitee to the related indemnitor. If the Indemnitor elects to assume
the defense, the Indemnitee shall retain the right to consent to the
selection of counsel, the terms of settlement and any use of Indemnitee's
or its affiliate's name in any settlement or any notification,
advertisement or publication of the
settlement.
|
|
Section
8.4
|
Insurance. Buyer
and Seller agree to each maintain professional (E&O) insurance
coverage for a period of at least one (1) year after the Closing Date with
a limit of at least $1 million
dollars.
|
ARTICLE
IX
ASSIGNMENT
OF RIGHTS TO THIRD PARTIES
|
Section
9.1
|
Notice. If
Buyer wishes to resell. or transfer any of the Accounts to a third party
(including without limitation, any of Buyer's affiliated companies), Buyer
need not give Seller written notices of Buyer's desire to
transfer.
|
ARTICLE
X
NOTICES
Unless
otherwise provided for herein, notices and other communications required or
permitted hereunder shall be in writing (including a writing delivered by
facsimile transmission) and shall be deemed to have been duly given (a) when
delivered, if delivered personally or (b) when delivered but no later than the
second Business Day following mailing sent by overnight mail or overnight
courier, in each case to the parties at the following addresses (or at such
other addresses as shall be specified by like notice):
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If to the
Seller:
Attn:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tel:
▇▇▇-▇▇▇-▇▇▇▇
Fax:▇▇▇-▇▇▇-▇▇▇▇
E-mail:
▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇
With
courtesy copy to:
Attn:
Tel:
Fax:
E-mail:
If to the
Buyer:
Attn:▇▇▇▇▇
Paris
Tel:▇▇▇-▇▇▇-▇▇▇▇
Fax:▇▇▇-▇▇▇-▇▇▇▇
E-mail:▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
With
courtesy copy to:
Attn:
Tel:
Fax:
E-mail:
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
|
Section
11.1
|
Termination. 9. Termination. This
Agreement may be termination by either Buyer or Seller if: (i) a material
breach of or default under the Agreement has occurred, which has not been
waived by the non-breaching party or cured by the breaching party within
five (5) business days of the receipt of notice by the non-breaching party
of the breach or default; or (ii) if any of the conditions to such party’s
obligations to close have not been satisfied in a timely
fashion.
|
|
Section
11.2
|
Further
Assurances. On the Closing Date, Seller and Buyer will
each take such other actions and execute such other documents as are
reasonably necessary to close the transactions contemplated
herein.
|
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Section
11.1
|
Severability.
If any term, covenant, condition or provision hereof is unlawful, invalid,
or unenforceable for any reason whatsoever, and such illegality,
invalidity, or unenforceability does not affect the remaining parts of
this Agreement, then all such remaining parts hereof shall be valid and
enforceable and have full force and effect as if the invalid or
unenforceable part had not been
included.
|
|
Section
11.2
|
Rights Cumulative;
Waivers. The rights of each of the parties under this Agreement are
cumulative and may be exercised as often as any party considers
appropriate under the terms and conditions specifically set forth. The
rights of each of the parties hereunder shall not be capable of being
waived or varied otherwise than by an express waiver or variation in
writing. Any failure to exercise or any delay in exercising any of such
rights shall not operate as a waiver or variation of that or any other
such right. Any defective or partial exercise of any of such rights shall
not preclude any other or further exercise of that or any other such
right. No act or course of conduct or negotiation on the part of any party
shall in any way preclude such party from exercising any such right or
constitute a suspension or any variation of any such
right.
|
|
Section
11.3
|
Headings. The
headings of the Articles and Sections contained in this Agreement are
inserted for convenience only and shall not affect the meaning or
interpretation of this Agreement or any provision
hereof.
|
|
Construction.
Unless the context otherwise requires, singular nouns and pronouns, when
used herein, shall be deemed to include the plural of such noun or pronoun
and pronouns of one gender shall be deemed to include the equivalent
pronoun of the other gender.
|
|
Section
11.5
|
No Strict
Construction. This Agreement is the joint work product of Seller
and Buyer, which has been negotiated by the parties and their respective
counsel, and will be fairly interpreted in accordance with its terms. In
the event of any ambiguity regarding the terms or intent of any provisions
of this Agreement, this Agreement shall not be strictly construed against,
and no inferences shall be drawn against, any party by reason of the fact
that such party may have drafted such particular
provision.
|
|
Section
11.6
|
Binding Effect.
This Agreement and the terms, covenants, conditions, provisions,
obligations, undertakings, rights and benefits hereof, including the
Addenda, Exhibits and Schedules hereto, shall be binding upon, and shall
inure to the benefit of, the undersigned parties and their respective
heirs, executors, administrators, representatives, successors, and
assigns.
|
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Section
11.7
|
Prior Understandings;
Entire Agreement. This Agreement supersedes any and all prior
discussions and agreements between Seller and Buyer with respect to the
purchase of the Accounts and other matters contained herein, and this
Agreement contains the sole and entire understanding between the parties
hereto with respect to the transactions contemplated
herein.
|
|
Section
11.8
|
Integrated
Agreement. This Agreement and all Addenda, Exhibits and Schedules
hereto constitute the final complete expression of the intent and
understanding of the Buyer and the Seller. This Agreement shall not be
altered or modified except by a subsequent writing, signed by Buyer and
Seller.
|
|
Section
11.9
|
Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall constitute one and the same instrument, and either party
hereto may execute this Agreement by signing any such
counterpart.
|
|
Section
11.10
|
Non-Merger/Survival.
Each and every covenant hereinabove made by Buyer or Seller shall survive
the delivery of the Transfer Documents and shall not merge into the
Transfer Documents, but instead shall be independently
enforceable.
|
|
Section
13.13
|
Governing Law/Choice
of Forum. This Agreement shall be construed, and the rights and
obligations of Seller and Buyer hereunder determined, in accordance with
the laws of the
State of California, without giving effect to any choice of law
principles. Buyer unconditionally and irrevocably consents to submit to
the exclusive jurisdiction of the courts of the State of California for
any actions, suits or proceedings arising out of or related to this
Agreement (and Buyer agrees not to commence any action, suit or proceeding
relating thereto except in such courts). In the event of litigation under
this Agreement, the prevailing party shall be entitled to an award of
attorneys' fees and costs.
|
|
Section
13.14
|
No Third-Party
Beneficiaries. This Agreement is for the sole and exclusive benefit
of the parties hereto, and none of the provisions of this Agreement shall
be deemed to be for the benefit of any other person or
entity.
|
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UCC Filings Against
Seller. Immediately
upon the sale of the Accounts to Buyer from Seller on the Closing Date and
at any time thereafter, the Buyer may file, in each appropriate office any
UCC financing statement, and any amendments or any continuation statements
thereto, required to perfect the sale of Accounts by Seller to
Buyer.
|
|
Section
13.16
|
Limited Power of
Attorney. On the Closing Date, Seller shall execute and deliver to
Buyer a Limited Power of Attorney in the form of Exhibit C
covering the Accounts sold.
|
IN
WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of
the date first above written.
|
Matterhorn
Financial Services LLC
|
North
Star Capital Acquisition LLC
|
||||
|
By:
|
/s/
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
By:
|
/s/
▇▇▇▇▇ Paris
|
||
|
Name:
|
Name:
|
▇▇▇▇▇
Paris
|
|||
|
Its
|
Its
CEO
|
||||
|
Duly
Authorized
|
Duly
Authorized
|
||||
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List of
Exhibits
Exhibit A
– Accounts Schedule
Exhibit B
– ▇▇▇▇ of Sale and Assignment of Accounts
Exhibit C
– Limited Power of Attorney
Exhibit D
– Form of New York State Affidavit
Exhibit E
- Seller’s Wire Transfer Instructions
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EXHIBIT
A
ACCOUNTS
SCHEDULE
Summary
of Accounts Sold:
Aggregate
Balances: $ 291,395,467.30
Number of
Accounts: 251,104
LIST OF
ACCOUNTS TO BE ATTACHED
REFER
TO ATTACHED CD
18 of
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▇▇▇▇ OF
SALE AND ASSIGNMENT OF ACCOUNTS
Matterhorn
Financial Services, LLC, a limited liability company organized under the laws of
California with an office at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
("Seller") hereby absolutely sells, transfers, assigns, sets-over and conveys to
North Star Capital Acquisition LLC, a limited liability company organized under
the laws of Minnesota with an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Buyer") without recourse and without representations or
warranties, express or implied, of any type, kind or nature except as set forth
in the Agreement (hereinafter defined):
(a) all
of Seller's right, title and interest in and to each of the Accounts identified
in the Account Schedule attached as Exhibit A to the
Agreement (hereinafter defined) (the "Accounts"), and
(b) all
principal, interest or other proceeds of any kind with respect to the Accounts,
but excluding any payments or other consideration with respect to the Accounts
received by or on behalf of Seller on or prior to the Closing Date of the
Agreement (hereinafter defined).
This ▇▇▇▇
of Sale is being executed and delivered pursuant to and in accordance with the
terms and provisions of that certain Purchase and Sale Agreement made and
entered into by and between the Seller and the Buyer dated January 8, 2010 (the
"Agreement"). The Accounts are defined and described in the Agreement and are
being conveyed hereby subject solely to the terms, conditions and provisions set
forth in the Agreement.
This ▇▇▇▇
of Sale shall be governed by the laws of the State of California without regard
to the conflicts-of-laws rules thereof.
|
DATED:
January 8, 2010
|
|
|
SELLER:
Matterhorn Financial Services, LLC
|
|
|
By:
|
|
|
Title:
|
19 of
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LIMITED
POWER OF ATTORNEY
KNOW ALL
MEN BY THESE PRESENTS, that Matterhorn Financial Services, LLC, a California
limited liability company ("Seller"), with respect to those certain purchased
Accounts, described in that certain Purchase and Sale Agreement dated January 8,
2010 (the "Agreement") by and between Seller and North Star Capital Acquisition
LLC, a Minnesota limited liability company ("Buyer"), hereby names, constitutes
and appoints Buyer, or any of its authorized agents, employees or
representatives, its duly authorized attorney and agent with limited power and
authority as it relates to the Accounts to: (i) endorse checks and other
negotiable instruments which may be received by Buyer; (ii) perfect, maintain,
and release any security interests; (iii) transfer and obtain any titles,
evidence of ownership or Account Documents; (iv) settle any insurance claims or
litigation and apply for any insurance, warranty or sales tax refunds; and (v)
to perform any and all acts relating to the Accounts which the undersigned was
entitled to do as the owner of said Accounts. Capitalized terms used herein and
not otherwise defined herein shall have the meanings set forth in the
Agreement.
EXECUTED
this 8th day of January, 2010
Seller:
Matterhorn Financial Services, LLC
By:
Name:
Title:
STATE OF
___________________)
COUNTY OF
________________)
On this
the _______ day of __________, 2009, before me the undersigned officer,
personally appeared ______________________, who acknowledged him/herself to be
the____________ of ______________, a ____________________ corporation, signer
and sealer of the foregoing instrument, and that he/she as such officer, being
authorized so to do, acknowledged the execution of the same to be his/her free
act and deed as such officer and the free act and deed of said
corporation.
IN
WITNESS WHEREOF, I hereunto set my hand.
___________________________
Commissioner
of the Superior Court
Notary
Public
20 of
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EXHIBIT
D
FORM OF
NEW YORK STATE AFFIDAVIT
AFFIDAVIT
OF SALE
OF
ACCOUNT
BY DEBT
SELLER
State of
New York, County of_________________.
_________________being
duly sworn, deposes and says:
I am over
18 and not a party to this action. I am the _________________ (title) of
_________________ (debt seller). In that position I am the custodian of the debt
seller's books and records, and am aware of the procedures used for the sale and
assignment of electronically stored business records.
On
_________________ (date) _________________ (debt seller) sold a pool of
charged-off accounts (the Accounts) by a Purchase and Sale Agreement and a ▇▇▇▇
of Sale to _________________ (debt buyer). _________________ (debt seller) had
previously bought the Accounts from _________________ on
_________________.
The
original creditor was _________________. All records received by
_________________ (debt seller) were received with affidavits attesting that the
records were kept in the regular course of business. The records were
incorporated into the debt sellers records and are kept in the regular course of
business.
I believe
that there are no errors in these accounts. The above statements are true to the
best of my knowledge.
Signed
this _____________ day of _____________,_______.
|
(Name
of Affiant)
|
Sworn
before me this _____________ day of _____________,_______.
_______________________
(Notary
Stamp)
21 of
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EXHIBIT
E
SELLER’S
WIRE TRANSFER INSTRUCTIONS
Bank:
Comerica Bank
ABA:
▇▇▇-▇▇▇-▇▇▇
Account
Name: Matterhorn Financial Services LLC
Account
Number: 1892738848
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