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Exhibit 10.1
ASSET PURCHASE AGREEMENT
BY AND BETWEEN
MIDLAND ACQUISITION CORPORATION
AND
WEST CAPITAL FINANCIAL SERVICES CORP.
Dated as of
May 11, 2000
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TABLE OF CONTENTS
ARTICLE 1 DEFINITIONS........................................................... 1
1.1 DEFINITIONS................................................... 1
ARTICLE 2 PURCHASE AND SALE OF ACQUIRED ASSETS.................................. 5
2.1 Purchase and Sale of Acquired Assets; Purchase Price.......... 5
2.2 Assumption of Liabilities..................................... 5
2.3 The Closing................................................... 5
2.4 Allocation.................................................... 5
2.5 Transfer Fees and Taxes....................................... 5
2.6 Precautionary Security Interest............................... 5
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF BUYER............................... 6
3.1 Organization of the Buyer..................................... 6
3.2 Authorization of Transaction.................................. 6
3.3 Noncontravention; No Consents................................. 6
3.4 MCM Stock..................................................... 6
3.5 Brokers' Fees................................................. 7
3.6 No Reliance................................................... 7
ARTICLE 4 CONDUCT PENDING THE CLOSING........................................... 7
4.1 General....................................................... 7
4.2 Notices and Consents.......................................... 8
4.3 Operation of the Acquired Assets.............................. 8
4.4 Preservation of Business...................................... 8
4.5 Full Access................................................... 8
4.6 Legend........................................................ 8
ARTICLE 5 CONDITIONS AND CLOSING................................................ 9
5.1 Conditions to Obligation of the Buyer......................... 9
5.2 Conditions to Obligation of the Seller........................ 10
5.3 Closing....................................................... 11
ARTICLE 6 TERMINATION........................................................... 11
6.1 Termination of Agreement...................................... 11
6.2 Effect of Termination......................................... 11
ARTICLE 7 POST-CLOSING COVENANTS................................................ 11
7.1 Post Closing Covenants........................................ 11
7.2 General....................................................... 12
7.3 Litigation Support............................................ 12
7.4 Confidentiality............................................... 12
7.5 Use of Name................................................... 13
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7.6 Website....................................................... 13
7.7 Employee Matters.............................................. 13
7.8 Audit......................................................... 13
7.9 Seller Actions................................................ 13
7.10 Transition Clerical Services.................................. 13
7.11 Maintenance of Corporation Formalities........................ 14
7.12 Compliance with Securities Laws............................... 14
ARTICLE 8 INDEMNIFICATION....................................................... 14
8.1 Indemnification Provisions for Benefit of the Seller.......... 14
8.2 Matters Involving Third Parties............................... 14
ARTICLE 9 MISCELLANEOUS......................................................... 15
9.1 Press Releases and Public Announcements....................... 15
9.2 No Third-Party Beneficiaries.................................. 15
9.3 Entire Agreement.............................................. 16
9.4 Succession and Assignment..................................... 16
9.5 Counterparts.................................................. 16
9.6 Headings...................................................... 16
9.7 Notices....................................................... 16
9.8 Governing Law................................................. 17
9.9 Waiver of Jury Trial.......................................... 17
9.10 Amendments and Waivers........................................ 17
9.11 Severability.................................................. 17
9.12 Expenses...................................................... 17
9.13 Construction.................................................. 17
9.14 Effect of Closing Over Unsatisfied Conditions................. 18
9.15 Incorporation of Exhibits and Schedules....................... 18
9.16 Specific Performance.......................................... 18
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Exhibit 1.3 Required Consents
Exhibit 1.4 Required Notices
Exhibit 2.1 Acquired Assets
Exhibit 2.1-19 Assigned Licenses
Exhibit 2.2 Assumed Liabilities
Exhibit 2.4 Tax Allocation
Exhibit 3.2 Transaction Documents
Exhibit 5.3 Closing Procedures
Exhibit 5.3(A) Bill of Sale
Exhibit 5.3(B) Registration Rights Agreement
Exhibit 5.3(C) Opinion of Buyer's Counsel
Exhibit 5.3(D) Opinion of Seller's Counsel
Exhibit 5.3(E) Acceptance Agreements
Exhibit 5.3(F) MCM Guaranty
Exhibit 5.3(G) Assumption Agreement
Exhibit 5.3(H) Seller Release
Exhibit 5.3(I) Investment Certificate
[Listed exhibits are omitted. The Company agrees to furnish supplementally these
exhibits to the SEC upon request.]
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is entered into as of this
11th day of May, 2000, by and between MIDLAND ACQUISITION CORPORATION, a
Delaware corporation (the "Buyer"), and WEST CAPITAL FINANCIAL SERVICES CORP., a
California corporation (the "Seller"). The Buyer and the Seller are sometimes
referred to collectively herein as the "Parties."
This Agreement contemplates a transaction in which the Buyer will
purchase certain specified assets and assume certain specified liabilities of
the Seller on the terms and in return for the consideration hereinafter set
forth.
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein made, and in consideration of the representations, warranties,
and covenants herein contained, the Parties agree as follows.
ARTICLE 1
DEFINITIONS
1.1 Definitions
"Acceptance Agreements" means the Acceptance Agreements in the forms
attached hereto as Exhibit 5.3(E).
"Acquired Assets" means all of Seller's right, title, and interest in
and to the assets set forth on Exhibit 2.1 hereto.
"Assigned Licenses" means the licenses, permits and agreements used as
of the date of this Agreement for the operation of the Acquired Assets (other
than collection licenses or permits issued by foreign, federal, state or local
governments and other than the Excluded Leases), including, without limitation,
the licenses, permits and agreements identified on Exhibit 2.1-19 attached
hereto.
"Assumed Liabilities" means only the obligations and liabilities of the
Seller set forth on Exhibit 2.2 attached hereto, but in every event excluding
the Excluded Liabilities.
"Assumption Agreement" means the Assumption Agreement in the form
attached hereto as Exhibit 5.3(G).
"Bill of Sale" means the Bill of Sale in the form attached hereto as
Exhibit 5.3(A).
"Buyer" has the meaning set forth in the preface above.
"Buyer's Closing Certificate" means the certificate delivered by the
Buyer pursuant to Section 5.1.6.
"CGCL" means the California General Corporation Law as in effect as of
the Closing Date.
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"Closing" means the consummation of the Transaction.
"Closing Date" means the date of the Closing.
"Closing Date Schedule of Receivables" means the schedule in
substantially the form of the Schedule of Receivables, dated as of two (2)
business days prior to the Closing Date.
"Closing Procedures" means the actions, performance and procedures for
the Closing attached hereto as Exhibit 5.3.
"Commercially Reasonable Efforts" means efforts which are commercially
reasonable; provided, however, that such efforts shall not require the Seller to
pay any consideration or provide any other value, other than administrative
costs and expenses.
"Confidential Information" means any information concerning the
businesses and affairs of the Parties that is not already generally available to
the public.
"Employee Schedule" means the list of all employees of Seller as of the
date of this Agreement, a copy of which has been delivered to the Buyer.
"Excluded Leases" means (i) that certain Self Storage Rental Agreement
between the Seller and A Aardvark Self Storage, dated May 22, 1997, (ii) the
Rental Agreements between the Seller and Associated Storage-Karny Mesa, dated
(A) August 5, 1997 (with respect to storage space number 439), and (B) June 5,
1998 (with respect to storage space number 71); and (iii) Lease, dated April 24,
2000, by and between Seller and Cor-O-Van for the storage and management of
business records.
"Excluded Liabilities" means any and all Liabilities of Seller, other
than the Assumed Liabilities, including, without limitation, and without the
effect of limiting or narrowing the scope of this definition: (i) other than as
set forth on Exhibit 2.2, any and all legal fees and expenses of any kind of
Seller; (ii) any Liabilities of the Seller or any of its affiliates to
SunAmerica Inc., West Capital Receivables Corporation I, WCFSC Special Purpose
Corporation, WCFSC Special Purpose Corporation II, WCFSC Consumer Receivables
Recovery Trust 1995-1, Jopco Management Services, Corect LLC, Daiwa Finance
Corporation, Norwest Bank Minnesota, N.A., or any of their stockholders,
directors, officers, employees, agents or affiliates; (iii) any Liabilities of
the Seller or any of its affiliates to Michael Joplin or Raechelle Joplin; (iv)
any Liabilities of the Seller or any of its affiliates to any shareholder of the
Seller; (v) the Excluded Leases, and (vi) other than as set forth on Exhibit
2.2, any Liabilities arising out of or from any pending or threatened action,
suit, proceeding, hearing, or investigation of, in, or before any court or
quasi-judicial or administrative agency of any federal, state, local, or foreign
jurisdiction or before any arbitrator.
"Fairness Opinion" means the letter dated May 10, 2000 from Duff &
Phelps, LLC and addressed to a Special Committee of the board of directors of
Seller regarding the Transaction.
"Intellectual Property" means all copyright, trademark, trade name,
patent, patent applications, practices and procedures and other license
agreements and confidential business information (including ideas, know how,
production processes and techniques, specifications, and customer and supplier
lists) used in the operation of, or in any way related or attached as an
interest to, the Acquired Assets, including any and all of the Seller's right,
title and interest in
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the name "West Capital Financial Services Corp.," or any variation of that name,
and "Encore Solutions," or any variation of that name.
"Investment Certificate" means the Subscription Agreement in the form
attached hereto as Exhibit 5.3(I).
"Lease" means the Agreement, dated as of September 24, 1994, as amended
by that certain Extension to Standard Industrial Lease, dated April 13, 2000, by
and between Seller and Transcontinental Realty Investors, a California Business
Trust, for the premises located at 5775 Roscoe Court, San Diego, California
92123.
"Liability" or "Liabilities" means any liability, obligation,
responsibilities, duty or claim (whether known or unknown, whether asserted or
unasserted, whether absolute or contingent, whether accrued or unaccrued,
whether liquidated or unliquidated, and whether due or to become due, currently
existing or hereafter arising), including, without limitation, any liability for
Taxes.
"Lien" means any mortgage, pledge, lien (statutory or other),
hypothecation, assignment, encumbrance, charge, preference, priority, security
interest or any limitation or restriction on ownership, use, transfer or
assignment, any of which is by contract, statute or by operation of any law.
"Loss" means, to the extent actually incurred, any and all damages,
penalties, fines, costs, liabilities, obligations, Taxes, Liens, losses,
expenses, and fees, including reasonable attorney's fees and expenses and any
court, arbitration or mediation costs or expenses arising from or relating to
any and all actions, suits, proceedings, hearings, investigations, charges,
complaints, claims, demands, injunctions, judgments, orders, decrees or rulings.
"MCM" means MCM Capital Group, Inc., a Delaware corporation.
"MCM Guaranty" means the Guaranty in the form attached hereto as
Exhibit 5.3(F).
"MCM Stock" means 375,000 shares of the common stock, $0. 01 par value
per share, of MCM.
"Opinion of Buyer's Counsel" means an opinion of counsel issued by
Squire, Sanders & Dempsey L.L.P., as counsel to Buyer and MCM, in the form
attached hereto as Exhibit 5.3(C).
"Opinion of Seller's Counsel" means an opinion of counsel issued by
Baker & McKenzie, as counsel to Seller, in the form attached hereto as Exhibit
5.3(D).
"Party" has the meaning set forth in the preface above.
"Person" means an individual, partnership, corporation, association,
joint stock company, trust, joint venture, unincorporated organization, or other
entity or organization, including a governmental entity (or any department,
agency, or political subdivision thereof).
"Purchase Price" has the meaning set forth in Section 2.1 below.
"Purchased Receivables" means the receivables comprising the 3 pools of
receivables that are part of the Acquired Assets, whether or not they are
included in the Schedule of
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Receivables, including without limitation any rights of the Seller under any
contract, promissory note or obligation that was accepted, entered into or
received by the Seller with respect to such receivables as part of Seller's
collection procedures.
"Receivable Purchase Agreements" means the following agreements:
1. JV-W1 Purchase Agreement, dated May 19, 1997 by and
between Seller and Bader Financial Services, LLC, nominee for Joint
Venture W1;
2. Purchase and Sale Agreement, dated September 30, 1997
by and between Seller and Business Office Services, Inc.; and
3. Receivable Purchase Agreement, dated December 17,
1997, by and between Seller and Monogram Credit Card Bank of Georgia.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement in the form attached hereto as Exhibit 5.3(B).
"Required Consents" means the third party consents set forth on Exhibit
1.3 attached hereto.
"Required Notices" means the notices to third parties set forth on
Exhibit 1.4 attached hereto.
"Schedule of Receivables" means the Schedule of Receivables regarding
the Purchased Receivables delivered to the Buyer on or about the date of this
Agreement.
"SEC" means the United States Securities and Exchange Commission.
"Security Purchase Agreement" means that certain Security Purchase
Agreement dated as of even date herewith by and between MCM and SunAmerica.
"Seller" has the meaning set forth in the preface above.
"Seller Release" means the Release in the form attached hereto as
Exhibit 5.3(H).
"Servicer Supplement" means a supplement to that certain Servicing
Agreement dated as of January 29, 1998 among Seller, as Servicer, West Capital
Receivables Corporation I, as Borrower and Norwest Bank Minnesota, National
Association, as Collateral Agent in the form reasonably acceptable to the Buyer
and the Seller.
"SunAmerica" means SunAmerica Inc., a Delaware corporation.
"Tax" means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Internal Revenue
Code Section 59A), customs duties, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, including any interest,
penalty, or addition thereto.
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"Transaction" means the transactions governed by this Agreement and the
other Transaction Documents.
"Transaction Documents" means this Agreement and the other documents,
agreements and certificates identified on Exhibit 3.2 hereto.
"Transfer Fee and Taxes" means any and all transfer and assumption fees
and Taxes arising out of the sale and transfer of the Acquired Assets pursuant
to this Agreement.
"Trust Receivables Purchase Agreement" means the Trust Receivables
Purchase Agreement in the form attached as Exhibit B to the Security Purchase
Agreement.
ARTICLE 2
PURCHASE AND SALE OF ACQUIRED ASSETS
2.1 Purchase and Sale of Acquired Assets; Purchase Price. Subject
to the terms and conditions of this Agreement, the Buyer agrees to purchase from
the Seller, and the Seller agrees to sell, transfer, convey, assign and deliver
to the Buyer, all of the Acquired Assets, at the Closing in exchange for (i) the
MCM Stock, and (ii) the assumption by the Buyer of the Assumed Liabilities
(collectively, the "Purchase Price").
2.2 Assumption of Liabilities. The Buyer will assume, from and
after the Closing Date, the Assumed Liabilities. The Buyer will not assume, nor
in any way be liable for, any Excluded Liabilities.
2.3 The Closing. The Closing shall take place at the offices of
Squire, Sanders & Dempsey L.L.P., 40 North Central Avenue, 27th Floor, Phoenix,
Arizona 85004, and shall occur, unless this Agreement is earlier terminated, on
the business day after the satisfaction of the conditions in Article 5, or at
such other location or time as the Seller and the Buyer may agree.
2.4 Allocation. The Parties agree that the Buyer shall allocate
the Purchase Price (and all other capitalizable costs) among the Acquired Assets
for all purposes (including financial accounting and tax purposes) in the manner
set forth on Exhibit 2.4. Such allocation shall be reported by the Buyer and the
Seller on Internal Revenue Service Form 8594, Asset Acquisition Statement, which
will be filed with the Buyer's and the Seller's Federal Income Tax Return for
the tax year that includes the Closing Date. To the extent not specified above,
the Parties further agree to coordinate their accounting for the transaction.
2.5 Transfer Fees and Taxes. Buyer shall pay all Transfer Fees and
Taxes.
2.6 Precautionary Security Interest. It is the intention of the
Seller that the transfer and assignment set forth in Section 2.1 above shall
constitute a sale of the Acquired Assets conveyed thereby from the Seller to the
Buyer, and the beneficial interest in and title to the Acquired Assets conveyed
pursuant to Section 2.1 shall not constitute property or interests in property
of, under applicable bankruptcy law, the Seller after the Closing Date. If,
under applicable bankruptcy law or non-bankruptcy law the Transaction is
avoided, voided, unwound, rescinded, reversed, or it is otherwise vitiated by a
court of competent jurisdiction in any applicable bankruptcy or non-bankruptcy
proceeding, then it is the intention of the Seller that this Agreement
constitute a security agreement (as defined in the Uniform Commercial Code
("UCC") as in effect in the State of Arizona) under the UCC, and the Seller
hereby grants to the
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Buyer, on the terms and conditions of this Agreement, a perfected first priority
security interest in and against all of the Seller's right, title and interest
in the Acquired Assets conveyed pursuant to Section 2.1 now existing and
hereafter acquired for the purpose of securing: (i) the Buyer's payment of the
Purchase Price and all other valuable consideration hereunder for the Acquired
Assets, including, without limitation, the MCM Stock and the amount of the
Assumed Liabilities ; and (ii) all other obligations of the Seller contained in
this Agreement and the Transaction Documents.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF BUYER
The Buyer represents, warrants and covenants to the Seller that the
statements contained in this Article 3 are correct and complete as of the date
of this Agreement. All of the representations, warranties and covenants
contained in this Article 3 shall survive for one year following the Closing
Date (except for the representations, warranties and covenants contained in
Sections 3.4 and 3.6 which shall survive indefinitely).
3.1 Organization of the Buyer. The Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation, and has the requisite corporate power and
authority to own and operate its properties and to carry on its business as now
conducted.
3.2 Authorization of Transaction. The Buyer has full power and
authority (including full corporate power and authority) to execute and deliver
this Agreement and the other Transaction Documents to which Buyer is or will be
a party and to perform its obligations hereunder and thereunder. This Agreement
and the other Transaction Documents to which Buyer is or will be a party have
each been duly authorized by all necessary action on the part of Buyer. This
Agreement has been, and the other Transaction Documents to which Buyer is or
will be a party will upon Closing be, duly executed and delivered by the Buyer.
This Agreement constitutes, and the other Transaction Documents to which Buyer
is or will be a party will each constitute, the valid and legally binding
obligation of the Buyer, enforceable in accordance with its terms and
conditions, except as such enforceability may be limited by applicable laws
relating to bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or similar laws affecting creditors' rights generally or by general
equitable principles and rules of law governing specific performance or
estoppel, and except to the extent that injunctive or other equitable relief is
within the discretion of a court of competent jurisdiction.
3.3 Noncontravention; No Consents. Neither the execution and the
delivery of this Agreement or the other Transaction Documents to which Buyer is
or will be a party, nor the consummation of the Transaction or the performance
of Buyer's obligations hereunder or thereunder, will violate, breach or result
in a default under (i) any constitution, statute, regulation, rule, injunction,
judgment, order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which the Buyer is subject or (ii) any
provision of Buyer's charter or bylaws or (iii) any agreement to which Buyer is
a party or by which it is bound. The Buyer does not need to give any notice to,
make any filing with, or obtain any authorization, consent, or approval of any
government, governmental agency or any Person in order for the Buyer to
consummate the Transaction in compliance with this Agreement and the Transaction
Documents.
3.4 MCM Stock. The MCM Stock has been duly authorized, and prior
to the Closing will be, validly issued, fully paid, non-assessable, and validly
existing, free and clear of any
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Liens, other than restrictions on transfer as provided under securities law.
Upon Closing, the Buyer will transfer to Seller, and the Seller will own, the
MCM Stock free and clear of any Liens, other than restrictions on transfer as
provided in the Registration Rights Agreement or under securities law.
3.5 Brokers' Fees. The Buyer has no Liability or obligation to pay
any fees or commissions to any broker, finder, or agent with respect to the
Transaction (i) for which the Seller could become liable or obligated, or (ii)
which could result in a Lien against the Acquired Assets.
3.6 No Reliance. BUYER ACKNOWLEDGES AND AGREES THAT (A) SELLER
MAKES NO REPRESENTATION OR WARRANTY IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED
WARRANTY, (B) THE ACQUIRED ASSETS ARE BEING SOLD "AS IS, WHERE IS" AND (C)
SELLER HEREBY DISCLAIMS ANY IMPLIED REPRESENTATION OR WARRANTY, INCLUDING,
WITHOUT LIMITATION, ANY REPRESENTATION OR WARRANTY CONCERNING THE VALUE OR
CONDITION OF THE ACQUIRED ASSETS. Buyer is a wholly-owned subsidiary of MCM.
Buyer and MCM are engaged in the same or similar businesses as Seller. Buyer and
MCM are sophisticated, experienced and knowledgeable with respect to the
business to which the Acquired Assets, the Assumed Liabilities and the
Transaction relate. Buyer has such information as it deemed adequate concerning
the Acquired Assets, the Assumed Liabilities, and the business and financial
condition of the Seller and its affiliates in order to make an informed decision
regarding the Transaction. Buyer has not relied upon Seller or any of Seller's
shareholders, creditors, officers, directors, employees, servants, agents,
attorneys, consultants or other representatives or advisors (collectively, the
"Seller Related Parties") to disclose any information (the "Information")
regarding or relating to the Acquired Assets, the Assumed Liabilities or the
business or financial condition of Seller or its affiliates in deciding to enter
into and consummate the Transaction with Seller. Buyer (a) agrees that neither
Seller nor any Seller Related Party shall have any liability whatsoever to Buyer
with respect to the non-disclosure of any Information, whether before or after
the date hereof, (b) irrevocably waives and releases all claims which Buyer
might otherwise have with respect to the non-disclosure of the Information,
whether before or after the date hereof, (c) expressly releases Seller and each
Seller Related Party from any and all liabilities arising from Buyer's inability
to review the Information and such person's knowledge of the Information, and
(d) agrees that it does not have, nor will it ever have, any right to assert,
and it will not assert, any claim of any sort against Seller, any Seller Related
Party or any other person arising from or related to Buyer's inability to review
the Information and such person's knowledge of the Information. Buyer
acknowledges that Seller is relying on this Section 3.6 in engaging in the
Transaction and would not engage in the Transaction in the absence of this
Section 3.6.
ARTICLE 4
CONDUCT PENDING THE CLOSING
Pre-Closing Covenants. The Parties agree as follows with respect to the
period between the execution of this Agreement and the Closing.
4.1 General. Each of the Parties will use Commercially Reasonable
Efforts to take all action and to do all things necessary, proper, or advisable
in order to consummate and make
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effective the Transaction (including satisfaction, but not waiver, of the
Closing conditions set forth in Article 5 below).
4.2 Notices and Consents. The Seller will give any Required
Notices, and the Seller shall use Commercially Reasonable Efforts to obtain any
Required Consents. Each of the Parties will give any Required Notices to, and
use Commercially Reasonable Efforts to obtain any Required Consents of,
governments and governmental agencies that are necessary or required in order to
consummate the Transaction.
4.3 Operation of the Acquired Assets. Except with respect to the
effect of the receipt of payments relating to the Purchased Receivables accepted
by the Seller or other actions taken in the ordinary course, the Seller will not
engage in any practice, take any action, or enter into any transaction except
those that are reasonably necessary (i) for the preservation of the Acquired
Assets, (ii) to continue its customary and normal operations and use of the
Acquired Assets, and (iii) to comply with all applicable laws, rules, and
regulations.
4.4 Preservation of Business. The Seller will keep the Acquired
Assets intact, except with respect to the effect of the receipt of payments
relating to the Purchased Receivables accepted by the Seller or other actions
taken in the ordinary course, including its present use and operation thereof,
and use Commercially Reasonable Efforts to maintain its relationships with
licensors, suppliers, customers, and employees related to the Acquired Assets.
4.5 Full Access. The Seller will permit representatives of the
Buyer to have full access at all reasonable times, and in a manner so as not to
interfere with the normal business operations of the Seller, to all of the
Seller's premises, properties, personnel, books, records (including Tax
records), contracts, and documents of, or pertaining to, the Acquired Assets.
4.6 Legend. The Buyer and the Seller covenant and agree that the
shares of MCM Stock that constitute a part of the Purchase Price will bear the
following legend until the shares are registered pursuant to the Registration
Rights Agreement or Seller receives an opinion of counsel satisfactory to Buyer
that the legend may be removed:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER
HEREOF, BY ACCEPTING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE
ISSUER THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED ONLY (A) TO THE ISSUER, (B) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND IN COMPLIANCE WITH
APPLICABLE STATE SECURITIES LAWS, (C) IN ACCORDANCE WITH RULE 144 UNDER
THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS, OR (D) IN ACCORDANCE WITH ANY OTHER EXEMPTION UNDER
THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS UPON THE DELIVERY OF A LEGAL OPINION, REASONABLY
SATISFACTORY TO THE ISSUER, TO THE FOREGOING EFFECT. THE TRANSFER OF
THE SECURITIES IS ALSO RESTRICTED UNDER THE TERMS OF A REGISTRATION
RIGHTS AGREEMENT, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES
OF MCM CAPITAL GROUP, INC.
4.7 Employee Offers. Prior to the Closing, Buyer or an affiliate
of Buyer shall extend offers of employment to all employees of Seller consistent
with Section 7.7 hereof.
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ARTICLE 5
CONDITIONS AND CLOSING
5.1 Conditions to Obligation of the Buyer. The obligation of the
Buyer to consummate the transactions to be performed by it in connection with
the Closing pursuant to Section 6.3 is subject to satisfaction of the following
conditions:
5.1.1 an event shall not have occurred after the date of
this Agreement that has a material adverse affect on or material change to (i)
the Acquired Assets taken as a whole, (ii) the Seller's ability to perform
pursuant to this Agreement or any Transaction Document to which it is party, or
(iii) the amount of Assumed Liabilities as it relates to the amount of
unrestricted cash of the Seller;
5.1.2 the Seller shall have performed and complied, in all
material respects, with all of its covenants hereunder through the Closing;
5.1.3 All required Required Consents shall have been
obtained, that the failure to obtain would have a material adverse affect on (i)
the ownership or use by the Seller of the Acquired Assets; or (ii) MCM's
ownership or rights with respect to the Acquired Assets, as defined in the
Security Purchase Agreement, or (iii) MCM's ownership or rights with respect to
the Transferred Property as defined in the Trust Receivables Purchase Agreement.
5.1.4 Seller shall have provided to Buyer (for filing or
delivery as part of the Closing) all necessary UCC-2 termination notices and
releases for any Liens (other than the Assumed Liabilities) against the Acquired
Assets existing as of the Closing Date;
5.1.5 no action, suit, or proceeding shall be pending (or
overtly threatened against the Buyer or with respect to the Acquired Assets or
the Transaction) before any court or quasi-judicial or administrative agency of
any federal, state, local, or foreign jurisdiction wherein an unfavorable
injunction, judgment, order, decree, ruling, or charge would (i) prevent or
restrict consummation of any of the Transaction, (ii) cause any aspect of the
Transaction to be rescinded, unwound or reversed in whole or in part following
consummation, (iii) affect adversely the right of the Buyer to own, use,
operate, sell, assign or transfer any of the Acquired Assets (and no such
injunction, judgment, order, decree, ruling, or charge shall be in effect); or
(iv) as a result of the Transaction would impose any liability on the Buyer for
any of the Excluded Liabilities.
5.1.6 the Seller shall have delivered to the Buyer,
evidence reasonably satisfactory to the Buyer, that Seller has complied in all
respects with the provisions of (i) the CGCL related to a "sale-of-assets
reorganization" (as defined in Section 181 of the CGCL), including, but not
limited to, compliance with Chapters 12 and 13 of the CGCL relating to board of
director and shareholder approval and dissenter's rights, and (ii) the bulk
transfer laws of California;
5.1.7 Buyer shall have received all documents it is
entitled to receive under the Closing Procedures;
5.1.8 the Fairness Opinion shall continue to be effective
and shall not have been rescinded, modified or withdrawn;
5.1.9 all conditions in Section 5.2 shall have been either
satisfied or waived by the Seller;
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5.1.10 Daiwa shall have entered into or be unconditionally
obligated (other than the Closing of this Transaction) to enter into the
Servicer Supplement;
5.1.11 SunAmerica shall be unconditionally committed (other
than the Closing of this Transaction) to perform pursuant to the Security
Purchase Agreement and upon such performance and performance by MCM, MCM shall
acquire title to the Acquired Assets as defined in Security Purchase Agreement
free of any Liens;
5.1.12 All parties other than MCM shall be unconditionally
committed (other than the closing of this Transaction and the consummation of
the transactions governed by the Security Purchase Agreement) to perform
pursuant to the Trust Receivables Purchase Agreement and upon such performance
and performance by MCM, MCM shall acquire title to the Transferred Property, as
defined in the Trust Receivables Purchase Agreement, free of any Liens; and
5.1.13 and MCM shall have the unconditional obligation
(other than the Closing of this Transaction and the consummation of the
transactions governed by the Security Purchase Agreement) to purchase the
Transferred Property as defined in and pursuant to the Trust Receivables
Purchase Agreement.
The Buyer may waive any condition (or any portion of any condition) specified in
this Section 5.1 if it executes a writing so stating and delivers it to the
Buyer at or prior to the Closing.
5.2 Conditions to Obligation of the Seller. The obligation of the
Seller to consummate the transactions to be performed by it in connection with
the Closing is subject to satisfaction of the following conditions:
5.2.1 the representations, warranties and covenants set
forth in Article 3 shall be true and correct in every respect as of the Closing
Date and the Buyer shall have delivered to the Seller a certificate to that
effect;
5.2.2 the Buyer shall have performed and complied, in all
material respects, with all of its covenants hereunder through the Closing;
5.2.3 no action, suit, or proceeding shall be pending or
threatened before any court or quasi-judicial or administrative agency of any
federal, state, local, or foreign jurisdiction or before any arbitrator wherein
an unfavorable injunction, judgment, order, decree, ruling, or charge would
prevent or restrict consummation of the Transaction;
5.2.4 Seller shall have received all documents it is
entitled to receive under the Closing Procedures;
5.2.5 the Fairness Opinion shall continue to be effective
and shall not have been rescinded, modified or withdrawn;
5.2.6 all conditions in Section 5.1 shall have been either
satisfied (or waived by the Buyer);
5.2.7 all conditions in Section 5.1 of the Security
Purchase Agreement (other than the Closing of this Transaction) shall have been
either satisfied (or waived by MCM);
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5.2.8 Daiwa shall have entered into or be unconditionally
obligated (other than the Closing of this Transition) to enter into the Servicer
Supplement;
5.2.9 MCM shall have the unconditional obligation (other
than the Closing of this Transaction and the consummation of the transactions
governed by the Security Purchase Agreement) to purchase the Transferred
Property as defined in and pursuant to the Trust Receivables Purchase Agreement;
and
5.2.10 there shall not have been a material adverse change
in the amount of the Excluded Liabilities.
The Seller may waive any condition specified in this Section 5.2 if it executes
a writing so stating and delivers it to the Seller at or prior to the Closing.
5.3 Closing. Upon satisfaction of the conditions or applicable
waiver by the appropriate party in Sections 5.1 and 5.2, the Buyer and Seller
shall unconditionally and timely perform pursuant to the Closing Procedures
applicable to such Party.
ARTICLE 6
TERMINATION
6.1 Termination of Agreement. Either of the Parties may terminate
this Agreement as provided below:
6.1.1 the Buyer may terminate this Agreement by giving
written notice to the Seller at any time prior to the Closing (i) if Seller has
breached any material covenant contained in this Agreement in any material
respect, if such breach is not cured within 3 days after notice of the breach,
or (ii) if the Closing shall not have occurred on or before May 25, 2000 (or
such later date, acceptable to Buyer in its sole discretion), by reason of the
failure of any condition precedent under Section 5.1 hereof.
6.1.2 the Seller may terminate this Agreement by giving
written notice to Buyer at any time prior to the Closing (i) if Buyer has
breached any material representation, warranty or covenant contained in this
Agreement in any material respect, if such breach is not cured within 3 days
after notice of the breach, or (ii) if the Closing shall not have occurred on or
before May 25, 2000 (or such later date, acceptable to Seller in its sole
discretion), by reason of the failure of any condition precedent under Section
5.2 hereof.
6.2 Effect of Termination. Notwithstanding the termination of this
Agreement, the confidentiality provisions provided in Sections 7.4 and 9.1 of
this Agreement shall survive.
ARTICLE 7
POST-CLOSING COVENANTS
7.1 Post Closing Covenants. The Parties agree as follows with
respect to the period following the Closing:
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7.2 General.
7.2.1 If at any time after the Closing any further action
is necessary or desirable to carry out the purposes of this Agreement, each
Party will take such further action (including the execution and delivery of
such further instruments and documents) as the other Party reasonably may
request, all at the sole cost and expense of the requesting Party (except as
otherwise set forth herein) provided that if such further action is required
because of a party's failure to originally perform pursuant to Section 5.3 of
this Agreement, then such action shall be at the sole cost and expense of such
party that failed to originally perform.
7.2.2 Seller shall provide the Buyer, on the Closing Date,
at 5775 Roscoe Court, San Diego, California, with a copy of all Assigned
Licenses and other documents or information included in the Acquired Assets, and
the Seller, on an ongoing basis, shall deliver to the Buyer, as soon as
commercially practicable after receipt, any and all bills, payments, notices and
any other documents related to the Acquired Assets or the Assumed Liabilities.
The Buyer, on an ongoing basis, shall deliver to the Seller, as soon as
commercially practicable after receipt, all bills, payments, notices and any
other documents related to any Excluded Liabilities or other assets or
operations of Seller. Each party agrees to provide the other with reasonable
access, upon reasonable notice, to such personnel, documents, books, records,
agreements, and financial data related to the Acquired Assets and Assumed
Liabilities and Excluded Liabilities, and other assets and operations of the
Seller as may be reasonably requested.
7.3 Litigation Support. In the event and for so long as either
party is actively contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand by or against any
third party in connection with (i) any transaction contemplated under this
Agreement or any of the Transaction Documents, or (ii) any fact, situation,
circumstance, status, condition, activity, practice, plan, occurrence, event,
incident, action, failure to act, or transaction on or prior to the Closing Date
involving the Acquired Assets, Assumed Liabilities, Excluded Liabilities, and
other assets and operations of the Seller, the other party will cooperate with
such party and its counsel in the pursuit, contest or defense, make available
its personnel, and provide such testimony and access to its books and records as
shall be reasonably necessary in connection with the pursuit, contest or
defense, all at the sole cost and expense of the requesting party (unless the
Seller is the requesting party and the Seller is entitled to indemnification
therefor under Article 8).
7.4 Confidentiality. Each Party shall treat and hold confidential
all of the Confidential Information, refrain from using any of the Confidential
Information except in connection with this Agreement. In the event that either
Party is requested or required (by oral question or request for information or
documents in any legal proceeding, interrogatory, subpoena, civil investigative
demand, or similar process) to disclose any Confidential Information, such Party
will (to the extent legally permitted) notify the other Party promptly of the
request or requirement so that the other Party may seek an appropriate
protective order or waive compliance with the provisions of this Section 7.4.
If, in the absence of a protective order or the receipt of a waiver hereunder,
such Party is, on the advice of counsel, compelled to disclose any Confidential
Information to any tribunal or else stand liable for contempt, such Party may
disclose the Confidential Information to the tribunal; provided, however, that
such Party shall use Commercially Reasonable Efforts to obtain, at the
reasonable request of the other Party, an order or other assurance that
confidential treatment will be accorded to such portion of the Confidential
Information required to be disclosed as the Buyer shall reasonably designate.
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7.5 Use of Name. Within 15 business days after the Closing Date,
Seller will cease using the name "West Capital Financial Services Corp." and any
variation of that name, in any way or manner other than as requested or approved
in writing by Buyer, in its sole discretion.
7.6 Website. Seller will arrange for the discontinuance of its
website located at http://www.westcap.com within 15 days following the Closing
Date.
7.7 Employee Matters. Buyer or an affiliate of Buyer shall extend
and honor offers of employment to all of the Seller's employees
contemporaneously with the Closing on terms substantially similar in the
aggregate to the terms of employment by the Seller (except policies, procedures
and benefits with respect to such offer will be that of Buyer or such affiliate
of Buyer) provided that such policies, procedures and benefits shall have such
terms as are necessary not to violate the Worker Adjustment and Retraining
Notification Act ("WARN")). Without expanding the scope of any other covenant in
this Agreement, this Section 7.8 is solely for the benefit of the Seller and no
employee of the Seller shall be a third-party beneficiary hereof. To the extent
such employees accept such offer, the Buyer or such affiliate of Buyer, to the
extent not prohibited under WARN, shall be under no obligation to provide credit
for prior service with the Seller for any purpose, including, without
limitation, employee plans and vacation policies of Buyer or such affiliate of
Buyer. Buyer or such affiliate of Buyer will timely serve all necessary WARN
notices. Buyer agrees to defend, indemnify and hold harmless Seller from and
against any Losses in connection with or arising out of or resulting from or
incident to WARN caused by any action of the Buyer.
7.8 Audit. If the Buyer is required to disclose pro forma or
historical financial statements for Seller or any of its subsidiaries, for any
period of time prior to the Closing Date, the Seller shall (i) request of
PriceWaterhouseCoopers that it assist (at Buyer's expense) in the preparation
thereof, and (ii) permit the Buyer and its officers, employees, accountants,
counsel, financial advisors and other representatives, to have reasonable
access, during normal business hours and upon reasonable advance notice, to the
properties, books and records of the Seller and its affiliates relating to the
Seller.
7.9 Seller Actions. Seller will not:
7.9.1 File, or consent to the filing of, any action,
demand, claim or proceeding or make any assertion or allegation that (i)
challenges the validity of the Transaction, including, without limitation, the
amount of consideration paid by the Buyer, the value of the Acquired Assets, or
the effect thereof on the creditors or shareholders of Seller; (ii) alleges that
the consideration given by the Buyer in connection with the Transaction was not
adequate or that any aspect of the Transaction constituted a fraudulent
conveyance or fraudulent transfer under applicable bankruptcy or non-bankruptcy
law; (iii) asserts the lack or insufficiency of any approval or consent to the
Transaction; or (iv) asserts that the Transaction or any aspect of the
Transaction Documents to which it is a party are not enforceable against Seller;
7.9.2 assert that the Buyer did not acquire title to the
Acquired Assets; or
7.9.3 assert that the Acquired Assets were not acquired by
the Buyer free and clear of any Liens (other than the Assumed Liabilities).
7.10 Transition Clerical Services. For the six-month period
following the Closing, Buyer agrees (at Buyer's sole expense) to perform and
provide Seller with reasonably required technical and administrative, clerical
service, assistance and support functions (the "Services")
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in a manner consistent with the Seller's past practices. The Parties recognize
that the Services may include services which, by their nature, are more
effectively to be provided by affiliates of the Buyer or to affiliates of
Seller. The Buyer shall, to the extent required in order for its affiliates to
provide such Services, cause its affiliates to provide such Services hereunder
as if such affiliates were themselves parties hereto. "Services" includes,
without limitation, accounting, treasury, information gathering, document and
file retrieval, clerical human resource services for prior employees of Seller,
and data processing services. At Seller's option, Buyer will continue to provide
such services subsequent to the initial six-month period for up to two
three-month periods immediately following the initial six-month period if so
requested in writing by Seller at least 10 days prior to the expiration of the
first six-month period, or if extended, at least 10 days prior to the expiration
of the first three-month period. In performance of these clerical services,
Buyer (i) is not required to interact in any way with any party other than
Seller, (ii) is not an agent of Seller, and (iii) is not acting as a fiduciary
to Seller. Buyer will only be liable for its services under this Section 7.10
for its willful misconduct.
7.11 Maintenance of Corporation Formalities. For so long as Seller
exists as a corporation, Seller will continue to observe required corporate
formalities for as long as Seller continues to exist. For purposes of this
section, "corporate formalities" includes, but is not limited to, maintaining a
board of directors, maintaining required officers, and conducting board of
directors and shareholder meetings, as required by its Articles of
Incorporation, its bylaws, and California General Corporation Law.
7.12 Compliance with Securities Laws. The Seller is acquiring the
shares of MCM Stock for its own account for investment and not with a view to
the distribution or other disposition thereof and will not distribute, sell or
otherwise dispose of any of the shares of MCM Stock except in compliance with
the Securities Act of 1933, as amended (the "Securities Act"). The seller
understands and agrees that the shares of MCM Stock have not been registered
under the Securities Act and may be resold (which resale is not now
contemplated) only if registered pursuant to the provisions thereunder or if an
exemption from registration is available.
ARTICLE 8
INDEMNIFICATION
8.1 Indemnification Provisions for Benefit of the Seller. For
purposes of this Section 8.1, all references to Seller include Seller, its
shareholders, officers, directors, employees and agents. The Buyer agrees to
indemnify and hold harmless the Seller from and against the entirety of any Loss
the Seller may suffer resulting from, arising out of, or relating to or caused
by:
8.1.1 Any breach of any representation, warranty or
covenant of Buyer contained in Article 3;
8.1.2 Any claim by a third party resulting from, arising
out of, or relating to or caused by (I) the manner in which Buyer operates the
Acquired Assets after the Closing Date or (ii) Buyer's failure to pay or perform
any of the Assumed Liabilities.
8.2 Matters Involving Third Parties.
8.2.1 If any third party shall notify any Party (the
"Indemnified Party") with respect to any matter (a "Third Party Claim") which
may give rise to a claim for indemnification against any other Party (the
"Indemnifying Party") under this Article 8, then the Indemnified
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Party shall promptly notify each Indemnifying Party thereof in writing;
provided, however, that no delay on the part of the Indemnified Party in
notifying any Indemnifying Party shall relieve the Indemnifying Party from any
obligation hereunder unless (and then solely to the extent) the Indemnifying
Party thereby is prejudiced.
8.2.2 Any Indemnifying Party will have the right to defend
the Indemnified Party against the Third Party Claim with counsel of its choice
reasonably satisfactory to the Indemnified Party so long as (A) the Indemnifying
Party notifies the Indemnified Party in writing within fifteen (15) days (or
sooner if required in connection with such Third Party Claim) after the
Indemnified Party has given notice of the Third Party Claim that the
Indemnifying Party will indemnify the Indemnified Party in accordance with this
Article 8 for such Third Party Claim, (B) the Indemnifying Party provides the
Indemnified Party with evidence reasonably acceptable to the Indemnified Party
that the Indemnifying Party will have the financial resources to defend against
the Third Party Claim and fulfill its indemnification obligations hereunder, (C)
the Third Party Claim involves only money damages and does not seek an
injunction or other equitable relief, (D) settlement of, or an adverse judgment
with respect to, the Third Party Claim is not, in the good faith judgment of the
Indemnified Party, likely to establish a precedential custom or practice
materially adverse to the continuing business interests of the Indemnified
Party, and (E) the Indemnifying Party conducts the defense of the Third Party
Claim actively and diligently.
8.2.3 So long as the Indemnifying Party is conducting the
defense of the Third Party Claim in accordance with Section 8.2.2 above, (A) the
Indemnified Party may retain separate co-counsel at its sole cost and expense
and participate in the defense of the Third Party Claim, (B) the Indemnified
Party will not consent to the entry of any judgment or enter into any settlement
with respect to the Third Party Claim without the prior written consent of the
Indemnifying Party (not to be withheld unreasonably), and (C) the Indemnifying
Party will not consent to the entry of any judgment or enter into any settlement
with respect to the Third Party Claim without the prior written consent of the
Indemnified Party (not to be withheld unreasonably).
8.2.4 If the Indemnifying Party, by the fifteenth day (or
sooner if required in connection with such Third Party Claim) after receipt of
notice of any Third Party Claim does not elect to defend against such claim, the
Indemnified Party will have the right to undertake the defense, compromise or
settlement of such claim on behalf of and for the account and risk of the
Indemnifying Party; provided, however, that the Indemnified Party shall not
settle or compromise such claim without the Indemnifying Party's prior written
consent, which consent shall not be unreasonably withheld.
ARTICLE 9
MISCELLANEOUS
9.1 Press Releases and Public Announcements. No Party shall issue
any press release or make any public announcement relating to the subject matter
of this Agreement prior to the Closing without the prior written approval of the
other Party; provided, however, that any Party may make any public disclosure it
believes in good faith is required by applicable law or any listing or trading
agreement concerning its publicly-traded securities.
9.2 No Third-Party Beneficiaries. This Agreement shall not confer
any rights or remedies upon any Person other than the Parties and their
respective successors and permitted assigns, and except for the enforcement of
any indemnification rights granted to the respective shareholders, officers,
directors, employees and agents of Buyer and Seller under Article 8.
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9.3 Entire Agreement. This Agreement and the Exhibits hereto
(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.
9.4 Succession and Assignment. This Agreement shall be binding
upon and inure to the benefit of the Parties named herein and their respective
successors and permitted 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, in the sole and absolute discretion of such other
Party.
9.5 Counterparts. This Agreement may be executed by facsimile and
in any number of counterparts, each of which shall be deemed an original but all
of which together will constitute one and the same instrument.
9.6 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.
9.7 Notices. All notices, requests, demands, claims, and other
communications hereunder must be in writing. Any notice, request, demand, claim,
or other communication hereunder shall be deemed duly given, if not earlier
received, on the second business day after it is sent by certified mail, return
receipt requested, postage prepaid, and addressed to the intended recipient as
set forth below:
Prior to Closing Date: After Closing Date:
If to the Seller:
West Capital Financial Services Corp. Address to be provided at Closing
5775 Roscoe Court
San Diego, California 92123
Attn: Robin Pruitt
E-mail: rpruitt@westcap.com
Copy to: Copy to:
Baker & McKenzie Baker & McKenzie
101 West Broadway, 12th Floor 101 West Broadway, 12th Floor
San Diego, California 92101 San Diego, California 92101
Attn: Ali Mojdehi Attn: Ali Mojdehi
E-mail: ali.m.m.mojdehi@bakernet.com E-mail: ali.m.m.mojdehi@bakernet.com
If to the Buyer:
Midland Acquisition Corporation Midland Acquisition Corporation
4302 East Broadway Road 4302 East Broadway Road
Phoenix, Arizona 85040 Phoenix, Arizona 85040
Attn: Gregory G. Meredith Attn: Gregory G. Meredith
E-mail: gmeredith@azmcm.com E-mail: gmeredith@azmc.com
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Copy to:
Squire, Sanders & Dempsey L.L.P. Squire, Sanders & Dempsey L.L.P.
Two Renaissance Square Two Renaissance Square
40 North Central Avenue, Suite 2700 40 North Central Avenue, Suite 2700
Phoenix, Arizona 85004 Phoenix, Arizona 85004
Attn: Timothy W. Moser, Esq. Attn: Timothy W. Moser, Esq.
E-mail: tmoser@ssd.com E-mail: tmoser@ssd.com
Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the address set forth above
using any other means (including personal delivery, expedited courier, messenger
service, telecopy, telex, ordinary mail, or electronic mail), but no such
notice, request, demand, claim, or other communication shall be deemed to have
been duly given unless and until it actually is received by the intended
recipient. Any Party may change the address to which notices, requests, demands,
claims, and other communications hereunder are to be delivered by giving the
other Party notice in the manner herein set forth.
9.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of California
without giving effect to any choice or conflict of law provision or rule
(whether of the State of California or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
California.
9.9 Waiver of Jury Trial. The Buyer and the Seller hereby
knowingly, voluntarily, and intentionally waive any rights they may have to a
trial by jury in respect of any litigation based hereon, or arising out of,
under or in connection with, this Agreement, any other Transaction Documents or
related to the Acquired Assets, Assumed Liabilities or the Excluded Liabilities,
or any course of conduct, course of dealing, statements (whether verbal or
written) or actions of the Buyer or the Seller. This provision is a material
inducement for the Buyer and the Seller entering into this Agreement.
9.10 Amendments and Waivers. No amendment of this Agreement shall
be valid unless the same shall be in writing and signed by the Buyer and the
Seller. No waiver by any Party 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.
9.11 Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any jurisdiction shall not affect
the validity or enforceability of the remaining terms and provisions hereof or
the validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
9.12 Expenses. Except to the extent included in the Assumed
Liabilities, each of the Buyer and the Seller will bear its own costs and
expenses (including legal fees and expenses) incurred in connection with this
Agreement and the transactions contemplated hereby.
9.13 Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. If an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as if drafted
jointly by the Parties and no presumption or burden of proof shall arise
favoring or disfavoring any Party by virtue of the authorship of any of the
provisions of this
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Agreement. Any reference to any federal, state, local, or foreign statute or law
shall be deemed also to refer to all rules and regulations promulgated
thereunder, unless the context requires otherwise. The word "including" shall
mean including without limitation.
9.14 Effect of Closing Over Unsatisfied Conditions. If Buyer elects
to proceed with the Closing over any failure of any condition or breach of any
covenant of the Seller, such condition or breach shall be deemed to be waived,
and as a result Buyer will each be deemed to fully release and forever discharge
the Seller on account of all claims, demands or charges (known or unknown) with
respect to the such condition or breach and any facts or circumstances giving
rise to or in respect thereof.
9.15 Incorporation of Exhibits and Schedules. The Exhibits
identified in this Agreement are incorporated herein by reference and made a
part hereof.
9.16 Specific Performance. Each of the Parties acknowledges and
agrees that the other Party will be damaged irreparably in the event any of the
provisions of this Agreement are not performed in accordance with their specific
terms or otherwise are breached. Accordingly, each of the Parties agrees that
the other Party shall be entitled to an injunction or injunctions to prevent
breaches of the provisions of this Agreement and to enforce specifically this
Agreement and the terms and provisions hereof in any action instituted in any
court of the United States or any state thereof having jurisdiction over the
Parties and the matter, in addition to any other remedy to which it may be
entitled, at law or in equity.
(BALANCE OF PAGE INTENTIONALLY LEFT BLANK)
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the date first above written.
WEST CAPITAL FINANCIAL SERVICES CORP.,
a California corporation
By: /s/ Carl C. Gregory III
-------------------------------------
Title: CEO
----------------------------------
("Seller")
MIDLAND ACQUISITION CORPORATION, a
Delaware corporation
By: /s/ Eric Kogan
-------------------------------------
Title: Chairman of the Board
----------------------------------
("Buyer")
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