SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): January 28, 1997
TRUST CREATED BY BLOCK MORTGAGE FINANCE, INC.
Delaware
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(State or other jurisdiction of incorporation)
333-14041 481758633
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(Commission File Number) (IRS Employer Identification No.)
One Main Plaza, 4435 Main Street, Suite 500, Kansas City, Missouri 64111
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (816) 932-4913
Not applicable
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(Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
Exhibit 5.1 Opinion of Morrison & Hecker L.L.P. re Legality Relating to
Block Mortgage Finance, Inc. Asset Backed Certificates,
Series 1998-1
Exhibit 8.1 Opinion of Brown & Wood L.L.P. re Tax Matters Relating to
Block Mortgage Finance, Inc. Asset Backed Certificates,
Series 1998-1
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
BLOCK MORTGAGE FINANCE, INC.
By: /s/ Mark Keller
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Name: Mark Keller
Title: Vice President
Date: January 28, 1998
EXHIBIT INDEX
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Exhibit No. Description
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5.1 Opinion of Morrison & Hecker L.L.P. re
Legality Relating to Block Mortgage
Finance, Inc. Asset Backed Certificates,
Series 1998-1
8.1 Opinion of Brown & Wood L.L.P. re Tax
Matters Relating to Block Mortgage
Finance, Inc. Asset Backed Certificates,
Series 1998-1
MORRISON & HECKER L.L.P.
ATTORNEYS AT LAW
2600 Grand Avenue
Kansas City, Missouri 64108-4606
Telephone (816) 691-2600
Telefax (816) 474-4208
January 28, 1998
Block Mortgage Finance, Inc.
One Main Street Plaza
4435 Main Street, Suite 500
Kansas City, Missouri 64111
Re: Block Mortgage Finance, Inc.
Registration Statement on Form S-3 (No. 333-14041)
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Ladies and Gentlemen:
We have acted as your counsel in connection with the preparation of (i)
a registration statement on Form S-3 (Registration No. 333-14041) filed with
the Securities and Exchange Commission (the "Commission") pursuant to the
Securities Act of 1933, as amended (the "Act"), on October 15, 1996, as
amended by amendment No. 1, and amendment No. 2 to such registration
statement filed with the Commission on December 31, 1996 and January 21,
1997, respectively (such registration statement, as so amended, the
"Registration Statement"); (ii) a prospectus forming a part of the
Registration Statement (the "Prospectus"); (iii) a Pooling and Servicing
Agreement dated as of January 1, 1998 (the "Pooling and Servicing Agreement")
among Block Mortgage Finance, Inc., as Depositor (the "Company"), Block
Financial Corporation, as Master Servicer, Companion Mortgage Corporation, as
Seller, and Bankers Trust Company of California, N.A., as Trustee (the
"Trustee"); and (iv) a final prospectus supplement dated January 27, 1998
(the "Prospectus Supplement") relating to the offer and sale of the Block
Mortgage Finance Asset Backed Certificates, Series 1998-1 Class A-1, Class A-
2, Class A-3, Class A-4, Class A-5 and Class A-6 Certificates (collectively,
together with the Class R Certificates, the "Certificates"). Capitalized
terms used and not otherwise defined herein have the respective meanings
given them in the Pooling and Servicing Agreement or the Accord identified in
the following paragraph.
This Opinion Letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the ABA Section
of Business Law (1991). As a consequence, it is subject to a number of
qualification, exceptions, definitions, limitations on coverage and other
limitation, all as more particularly described in the Accord, and this
Opinion Letter should be read in conjunction therewith. The opinions
expressed herein are given only with respect to the present status of the
substantive laws of the state of Missouri (not including the choice-of-law
rules under Missouri law). We express no opinion as to any matter arising
under the laws of any other jurisdiction.
In rendering the opinions set forth below, we have examined and relied
on the following: (1) the Registration Statement, the Prospectus and the
Prospectus Supplement; (2) the Pooling and Servicing Agreement; and (3) such
other documents, materials, and authorities as we have deemed necessary in
order to enable us to render our opinions set forth below.
Based on and subject to the foregoing and other qualifications set forth
below, we are of the opinion that:
1. The Pooling and Servicing Agreement is the valid and legally
binding obligation of the Company, enforceable against the Company in
accordance with its terms.
2. When (a) the Mortgage Loans and other consideration for the
Certificates constituting the Trust Fund have been deposited with the
Trustee, (b) the Certificates have been duly executed, authenticated,
delivered and sold as provided in the Pooling and Servicing Agreement and the
Prospectus Supplement and (c) the consideration for the sale of the
Certificates has been fully paid to the Company, the Certificates will be
legally and validly issued, fully paid and nonassessable, and the duly
registered holders of the Certificates will be entitled to the benefits of
the Pooling and Servicing Agreement.
The General Qualifications apply to the opinions set forth in paragraphs
1 and 2 above, and in addition, such opinions are subject to the
qualification that certain remedial, waiver and other similar provisions of
the Pooling and Servicing Agreement or the Certificates may be rendered
unenforceable or limited by applicable laws, regulations or judicial
decisions, but such laws, regulations and judicial decisions will not render
the Pooling and Servicing Agreement or the Certificates invalid as a whole
and will not make the remedies available thereunder inadequate for the
practical realization of the principal benefits intended to be provided
thereby, except for the economic consequences of any judicial, administrative
or other delay or procedure which may be imposed by applicable law.
We hereby consent to the filing of this letter as an Exhibit to the
Registration Statement and to the references to this firm under the heading
"Legal Matters" in the Prospectus forming a part of the Registration
Statement. This consent is not to be construed as an admission that we are a
person whose consent is required to be filed with the Registration Statement
under the provisions of the Act.
Very truly yours,
/s/ Morrison & Hecker L.L.P.
MORRISON & HECKER L.L.P.
BROWN & WOOD LLP
One World Trade Center
New York, N.Y. 10048-0057
Telephone: 212-839-5300
Facsimile: 212-839-5599
January 28, 1998
MBIA Insurance Corporation
113 King Street
Armonk, NY 10504
Block Mortgage Finance, Inc.
4435 Main Street, Suite 500
Kansas City, Missouri 64111
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, NY 10036
Salomon Brothers Inc.
Seven World Trade Center, 32nd Floor
New York, NY 10048
Re: Block Mortgage Finance, Inc. Asset Backed Certificates,
Series 1998-1
Ladies and Gentlemen:
We have acted as special tax counsel for you in connection with the
formation of the Block Mortgage Finance, Inc. Asset Backed Certificates,
Series 1998-1 (the "Trust Fund") created pursuant to a Pooling and Servicing
Agreement, dated as January 1, 1998 (the "Pooling and Servicing Agreement")
among Block Mortgage Finance, Inc., as depositor (the Depositor"), Companion
Mortgage Corporation, as seller (the "Seller"), Block Financial Corporation,
as master servicer (the "Master Servicer") and Bankers Trust Company of
California N.A., as trustee, (the "Trustee"), and the issue of the Class A-1
Certificates, Class A-2 Certificates, Class A-3 Certificates, Class A-4
Certificates, Class A-5 Certificates, Class A-6 Certificates (together, the
"Class A Certificates") and the Class R Certificates (together, with the
Class A Certificates, the "Certificates"). The Trust Fund will consist
primarily of a pool of mortgage loans secured by mortgages, deeds of trust or
other instruments creating a first or second lien on one to four family
dwellings. Unless otherwise indicated, all terms used herein shall have the
meanings assigned to such terms in the Pooling and Servicing Agreement.
In arriving at the opinions expressed below, we have examined such
documents and records as we have deemed appropriate, including the following:
1. A signed copy of registration statement No. 333-14041 filed by the
Depositor on Form S-3 with the Securities and Exchange Commission
(the "Commission") pursuant to the Securities Act of 1933, as
amended (the "Act") (the term "Registration Statement" shall mean
the registration statement in the form in which the most recent
post-effective amendment thereto became effective under the Act).
2. The prospectus dated January 27, 1998 (the "Basic Prospectus") and
the supplement thereto dated January 27, 1998 (the "Prospectus
Supplement") relating to the offering of the Designated
Certificates in the form in which the Basic Prospectus and the
Prospectus Supplement were filed with the Commission pursuant to
Rule 424 of the rules and regulations of the Commission under the
Act (the Base Prospectus as supplemented by the Prospectus
Supplement is hereinafter referred to as the "Prospectus").
3. A signed copy of the Pooling and Servicing Agreement.
In addition, we have made such investigations of such matters of law as
we deemed appropriate as a basis for the opinions expressed below. Further,
we have assumed the genuineness of all signatures and the authenticity of all
documents submitted to us as originals. We have, for the purposes of
rendering the opinions, also relied on certain factual, numerical and
statistical information which is based on the assumptions used in pricing the
Certificates. Our opinions are also based on the assumption that there are
no agreements or understandings with respect to the transactions contemplated
in the Documents (other than those contained in the Documents) and that all
parties to the Documents will comply with the terms thereof, including all
tax reporting requirements contained therein.
Based on the foregoing, we are of the opinion that, assuming compliance
with the pertinent provisions of the Pooling and Servicing Agreement, the
Trust Fund will qualify as a real estate mortgage investment conduit"
("REMIC") as defined in the Internal Revenue Code of 1986, as amended (the
"Code"). Each Class of the Class A Certificates will be treated as "regular
interests" in a REMIC, and the Class R Certificates will be treated as the
beneficial ownership of a single class of "residual interests" in a REMIC.
The opinions set forth herein are based upon the existing provisions of
the Code and Treasury regulations issued or proposed thereunder, published
Revenue Rulings and releases of the Internal Revenue Service and existing
case law, any of which could be changed at any time. Any such changes may be
retroactive in application and could modify the legal conclusions upon which
such opinions are based. The opinions expressed herein are limited as
described above, and we do not express an opinion on any other legal or
income tax aspect of the transactions contemplated by the Documents relating
to the transaction.
In rendering the foregoing opinions, we express no opinion as to the
laws of any jurisdiction other than the federal income tax laws of the United
States. This opinion is rendered as of the date hereof and we undertake no
obligation to update this opinion or advise you of changes in the event there
is any change in legal authorities, facts, assumptions or Documents on which
this opinion is based (including the taking of any action by any party to the
Documents pursuant to any opinion of counsel or a waiver), or any inaccuracy
in any of the representations, warranties or assumptions upon which we have
relied in rendering this opinion, unless we are specifically engaged to do
so. This opinion is rendered only to those to whom it is addressed and may
not be relied on in connection with any transactions other than the
transactions contemplated herein. The opinion may not be relied upon for any
other purpose, or relied upon by any other person, firm or corporation for
any purpose, without our prior written consent.
Very truly yours,
/s/ BROWN & WOOD LLP
