UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended MARCH 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from . . . .to . . . . . . . . . .
Commission file number 1-3521
ARISTAR, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 95-4128205
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
8900 Grand Oak Circle, Tampa, FL 33637-1050
(Address of principal executive offices) (Zip Code)
(813) 632-4500
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
As of April 30, 1996, there were 1,000 shares of Common Stock
outstanding.
Registrant meets the conditions set forth in General Instruction (H)(1)(a) and
(b) of Form 10-Q and is therefore filing this Form with the reduced disclosure
format.
<PAGE> 2
ARISTAR, INC. AND SUBSIDIARIES
FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Part I. Financial Information:
Item 1. Financial Statements
<S> <C>
Consolidated Statements of Financial Condition -
March 31, 1996, December 31, 1995 and
March 31, 1995. . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Consolidated Statements of Operations and Retained Earnings -
Three Months Ended March 31, 1996 and 1995. . . . . . . . . . . . . 4
Consolidated Statements of Cash Flows -
Three Months Ended March 31, 1996 and 1995. . . . . . . . . . . . . . 5
Notes to Consolidated Financial Statements. . . . . . . . . . . . 6 - 7
Item 2. Management's Analysis of the
Results of Operations for the Three Months
Ended March 31, 1996. . . . . . . . . . . . . . . . . . . . . . . . . 8
Part II. Other Information:
Item 5. Other Information. . . . . . . . . . . . . . . . . . . . .9 - 10
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . 10 - 11
SIGNATURE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
</TABLE>
<PAGE> 3
Item 1. Financial Statements
ARISTAR, INC. and Subsidiaries
Consolidated Statements of Financial Condition
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31, March 31,
(Dollars in thousands) 1996 1995 1995
<S> <C> <C> <C>
ASSETS
Finance receivables, net $ 1,580,820 $ 1,637,733 $ 1,500,775
Investment securities 117,050 120,952 109,050
Cash and cash equivalents 12,161 7,142 7,664
Property and equipment, less
accumulated depreciation and
amortization: 1996, $19,649;
1995, $19,249 and $20,919 10,805 11,192 12,753
Deferred charges 10,512 11,570 12,035
Excess of cost over equity of
companies acquired, less
accumulated amortization:
1996, $46,780; 1995, $45,028
and $39,773 60,232 61,983 67,238
Other assets 12,225 11,350 10,017
TOTAL ASSETS $ 1,803,805 $ 1,861,922 $ 1,719,532
LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities
Short-term debt $ 261,329 $ 312,876 $ 121,082
Long-term debt 1,003,906 1,003,809 1,092,630
Total debt 1,265,235 1,316,685 1,213,712
Accounts payable and other
liabilities 28,641 42,189 36,291
Federal and state income taxes 10,561 8,883 7,639
Insurance claims and benefits
reserves 7,520 7,900 7,814
Unearned insurance premiums and
commissions 59,443 56,604 55,450
Total liabilities 1,371,400 1,432,261 1,320,906
Stockholder's equity
Common stock: $1.00 par value;
10,000 shares authorized; 1,000
shares issued and outstanding 1 1 1
Paid-in capital 44,894 44,894 44,894
Retained earnings 387,301 384,227 355,920
Net unrealized holding gain (loss) on
investment securities 209 539 (2,189)
Total stockholder's equity 432,405 429,661 398,626
TOTAL LIABILITIES AND
STOCKHOLDER'S EQUITY $ 1,803,805 $ 1,861,922 $ 1,719,532
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE> 4
ARISTAR, INC. and Subsidiaries
Consolidated Statements of Operations and Retained Earnings
(Unaudited)
<TABLE>
<CAPTION>
For the Three
Months Ended March 31,
(Dollars in thousands) 1996 1995
<S> <C> <C>
Loan interest and fee income $ 80,391 $ 76,984
Investment securities income 1,832 1,747
Total interest income 82,223 78,731
Interest and debt expense 22,881 23,758
Net interest income before
provision for credit losses 59,342 54,973
Provision for credit losses 13,540 9,892
Net interest income 45,802 45,081
Other operating income
Net insurance operations
and other income 6,560 7,084
Other expenses
Personnel costs 17,390 16,260
Occupancy expense 2,203 2,249
Advertising expense 1,079 943
Amortization of excess cost over
equity of companies acquired 1,752 1,752
Other operating expenses 9,992 9,265
32,416 30,469
Income before income taxes 19,946 21,696
Provision for federal and state income taxes 7,822 8,542
Net income 12,124 13,154
Retained Earnings
Beginning of period 384,227 350,266
Dividends paid (9,050) (7,500)
End of period $ 387,301 $ 355,920
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE> 5
ARISTAR, INC. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
For the Three
Months Ended March 31,
(Dollars in thousands) 1996 1995
<S> <C> <C>
Cash flows from operating activities
Net income $ 12,124 $ 13,154
Adjustments to reconcile net income to net
cash provided by operating activities
Provision for credit losses 13,540 9,892
Depreciation and amortization 3,197 3,389
Deferred income taxes 188 (503)
Increase (decrease) in
Accounts payable and other liabilities (13,548) (9,209)
Unearned insurance premiums and commissions
and insurance claims and benefits reserves 2,459 1,582
Currently payable income taxes 1,678 7,218
Decrease (increase) in other assets (875) 9,679
Net cash provided by operating activities 18,763 35,202
Cash flows from investing activities
Investment securities purchased (10,030) (6,690)
Investment securities matured 13,441 6,076
Finance receivables originated or purchased (233,348) (237,658)
Finance receivables repaid or sold 276,888 266,982
Net change in property and equipment (98) (178)
Net cash provided by investing activities 46,853 28,532
Cash flows from financing activities
Net change in short-term debt (51,547) (58,003)
Dividends paid (9,050) (7,500)
Other, net (235)
Net cash used in financing activities (60,597) (65,738)
Net increase (decrease) in cash and cash
equivalents 5,019 (2,004)
Cash and cash equivalents
Beginning of period 7,142 9,668
End of period $ 12,161 $ 7,664
Supplemental disclosures of cash flow
information
Interest paid $ 30,913 $ 27,783
Net intercompany payments (refunds)
in lieu of federal
and state income taxes 6,144 (1,112)
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE> 6
ARISTAR, INC. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
Note 1 Basis of Presentation
The accompanying unaudited consolidated financial statements of Aristar, Inc.
and subsidiaries (the "Company") have been prepared in accordance with the
instructions to Form 10-Q and do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments
(consisting of normal recurring adjustments) considered necessary for a fair
presentation have been included. These statements should be read in
conjunction with the consolidated financial statements and notes thereto
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1995.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Certain amounts in prior periods have been reclassified to conform to the
current period's presentation.
Note 2 Ownership
The Company is an indirect, wholly-owned subsidiary of Great Western Financial
Corporation.
<PAGE> 7
ARISTAR, INC. and Subsidiaries
Notes to Consolidated Financial Statements (Continued)
Note 3 Finance Receivables
Finance receivables consist of the following:
<TABLE>
<CAPTION>
March 31, December 31, March 31,
(Dollars in thousands) 1996 1995 1995
<S> <C> <C> <C>
Consumer finance receivables
Real estate secured loans $ 580,008 $ 567,377 $ 524,550
Other instalment loans 1,017,764 1,097,334 1,018,983
Retail instalment contracts 334,937 343,902 309,404
Gross finance receivables 1,932,709 2,008,613 1,852,937
Less: Unearned finance charges and
deferred loan fees (306,875) (326,758) (311,216)
Allowance for credit losses (45,014) (44,122) (40,946)
Finance receivables, net $1,580,820 $1,637,733 $1,500,775
</TABLE>
Activity in the Company's allowance for credit losses is as follows:
<TABLE>
<CAPTION>
Three Months Ended March 31,
(Dollars in thousands) 1996 1995
<S> <C> <C>
Balance, beginning of period $ 44,122 $ 41,311
Provision for credit losses 13,540 9,892
Amounts charged off (16,992) (14,195)
Recoveries 4,020 3,938
Allowances on notes purchased 324
Balance, end of period $ 45,014 $ 40,946
</TABLE>
Note 4 Long-term Debt
Long-term debt at March 31, 1996 was comprised of:
(Dollars in thousands)
Senior Notes and Debentures $ 804,411
Senior Subordinated Notes
and Debentures 199,495
$1,003,906
<PAGE> 8
Item 2. MANAGEMENT'S ANALYSIS OF THE RESULTS OF OPERATIONS FOR THE THREE
MONTHS ENDED MARCH 31, 1996
The Company's average net finance receivables outstanding were $94.3 million,
or 6.05%, greater in the first quarter of 1996 as compared to the same period
of 1995, while, as a reflection of interest rate and competitive pressures,
the overall portfolio yield decreased .30%. As a result, loan interest and
fee income increased $3.4 million, or 4.4%, for the quarter ended March 31,
1996, over the quarter ended March 31, 1995. Income from investment
securities increased $85 thousand, or 4.9%, over the first quarter of 1995.
As a result, total interest income increased by $3.5 million, or 4.4%, over
the same period of 1995. On the other hand, average debt outstanding
increased $51.2 million, or 4.1%, and the weighted average interest rate on
such debt decreased by 58 basis points, resulting in a decrease in interest
and debt expense of $877 thousand, or 3.7%, for the quarter ended March 31,
1996, as compared to the same 1995 period. These factors resulted in an
increase in net interest income before provision for credit losses of $4.4
million, or 8.0%.
The provision for credit losses for the quarter ended March 31, 1996 was 3.28%
as an annualized percentage of average net finance receivables for that
period, as compared to 2.54% for the first quarter of 1995. The increase in
provision rate reflects management's assessment of the quality of the
Company's receivables portfolio at this time including current economic
trends, loan portfolio agings, historical loss experience and evaluation of
collateral.
Personnel expenses were $1.1 million, or 7.0%, higher in the period ended
March 31, 1996, as compared to the same 1995 period. This is primarily due to
normal compensation increases.
Productivity, defined as the ratio of operating and administrative expenses
(before deferral of direct loan costs) to average outstanding finance
receivables, improved to 8.1% in the quarter ended March 31, 1996 as compared
to 8.2% in the first quarter of 1995.
<PAGE> 9
PART II. OTHER INFORMATION
Item 5.
(a) Acquisition or Disposition of Assets
Aristar, Inc. and its subsidiaries (the Company ) and Great Western
Bank, A Federal Savings Bank (the Bank ) are wholly-owned subsidiaries
of Great Western Financial Corporation ( GWFC ). In an intercompany
transaction, on April 30, 1996, the Bank transferred to the Company
approximately $242 million in net consumer finance receivables from
customers located in California and Florida and $2 million in associated
net liabilities, previously held directly by the Bank. The Company paid
fair market value of approximately $250 million for the acquired
receivables and net liabilities in a combination of cash of $248 million
and the assumption of approximately $2 million in related deferred tax
liabilities. The approximate $10 million premium paid pursuant to this
intercompany transaction was accounted for as a dividend to GWFC,
pursuant to generally accepted accounting principles. The Company
issued commercial paper to fund the cash portion of the purchase price.
(i) Financial statements of business acquired.
It is impracticable to provide the required financial statements with
this Report on Form 10-Q. As permitted by Item 7 (a) (4) of Form 8-
K, such financial statements will be filed under cover of Form 10-Q/A
as soon as practicable, but not later than 60 days after this Report
on Form 10-Q must be filed.
(ii) Pro forma financial information.
It is impracticable to provide the required pro forma financial
information with this Report on Form 10-Q. As permitted by Item 7
(b) (2) of Form 8-K, such pro forma financial information will be
filed under cover of Form 10-Q/A as soon as practicable, but not
later than 60 days after this Report on Form 10-Q must be filed.
<PAGE> 10
(b) Other Information
The calculation of the Company's ratio of earnings to fixed charges
as of the dates indicated is shown below:
<TABLE>
<CAPTION>
Three Months Year Three Months
Ended Ended Ended
March 31, December 31, March 31,
1996 1995 1995
<S> <C> <C> <C>
Income before income taxes $ 19,946 $ 93,134 $ 21,696
Fixed charges:
Interest and debt expense on
all indebtedness 22,881 91,257 23,758
Appropriate portion of
rentals (33%) 754 2,875 666
Total fixed charges 23,635 94,132 24,424
Earnings available for
fixed charges $ 43,581 $ 187,266 $ 46,120
Ratio of earnings
to fixed charges 1.84 1.99 1.89
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(2) (a) Agreement dated as of April 30, 1996,
between Great Western Bank and First
Community Financial Services, Inc.
(b) Agreement dated as of April 30, 1996,
between Great Western Bank and Blazer
Financial Services, Inc.
(c) Agreement dated as of April 30, 1996,
between Great Western Bank and Blazer
Financial Services, Inc. of Florida.
(4) (a) Indenture dated as of July 15, 1984,
between Aristar, Inc. and Bank of
Montreal Trust Company, as trustee.
(1)
(b) First supplemental indenture to Exhibit
(4) (a) dated as of June 1, 1987. (1)
(c) Indenture dated as of August 15, 1988,
between Aristar, Inc. and Bank of
Montreal Trust Company, as trustee. (2)
<PAGE> 11
(d) Indenture dated as of May 1, 1991
between Aristar, Inc. and Security
Pacific National Bank, as trustee. (3)
(e) Indenture dated as of May 1, 1991
between Aristar, Inc. and The First
National Bank of Boston, as trustee.
(3)
(f) Indenture dated as of July 1, 1992
between Aristar, Inc. and The Chase
Manhattan Bank, N.A., as trustee. (4)
(g) Indenture dated as of July 1, 1992
between Aristar, Inc. and Citibank,
N.A., as trustee. (4)
(h) Indenture dated as of July 1, 1995
between Aristar, Inc. and The Bank of
New York, as trustee. (5)
(i) The registrant hereby agrees to furnish
the Securities and Exchange Commission
upon request with copies of all
instruments defining rights of holders
of long-term debt of Aristar, Inc. and
its consolidated subsidiaries.
(10) Income Tax Allocation Agreement dated as of December
15, 1995 between Aristar, Inc. and Great Western
Financial Corporation. (6)
(27) Financial Data Schedule.
(1) Incorporated by reference to Registrant's
Quarterly Report on Form 10-Q for the
quarter ended March 31, 1993, Commission
file number 1-3521.
(2) Incorporated by reference to Registrant's
Quarterly Report on Form 10-Q for the
quarter ended September 30, 1988,
Commission file number 1-3521.
(3) Incorporated by reference to Registrant's
Current Report on Form 8-K dated May 29,
1991, Commission file number 1-3521.
(4) Incorporated by reference to Registrant's
Current Report on Form 8-K dated June 24,
1992, Commission file number 1-3521.
(5) Incorporated by reference to Registrant's
Quarterly Report on Form 10-Q for the
quarter ended June 30, 1995, Commission
file number 1-3521.
(6) Incorporated by reference to Registrant's
Annual Report on Form 10-K for the year
ended December 31, 1995, Commission file
number 1-3521.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the period covered by this
Report.
<PAGE> 12
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ARISTAR, INC.
Date: May 15, 1996 By: /s/ James A. Bare
James A. Bare
Executive Vice President and
Chief Financial Officer
(Chief Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 9
<LEGEND>
This Schedule contains summary financial information extracted from the
Company's financial statements filed as part of its Report on Form 10-Q for the
quarter ended March 31, 1996 and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 12,161
<INT-BEARING-DEPOSITS> 0
<FED-FUNDS-SOLD> 0
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 117,050
<INVESTMENTS-CARRYING> 0
<INVESTMENTS-MARKET> 0
<LOANS> 1,625,834<F1>
<ALLOWANCE> (45,014)
<TOTAL-ASSETS> 1,803,805
<DEPOSITS> 0
<SHORT-TERM> 261,329
<LIABILITIES-OTHER> 28,641
<LONG-TERM> 1,003,906
0
0
<COMMON> 1
<OTHER-SE> 432,404
<TOTAL-LIABILITIES-AND-EQUITY> 1,803,805
<INTEREST-LOAN> 80,391
<INTEREST-INVEST> 1,832
<INTEREST-OTHER> 0
<INTEREST-TOTAL> 82,223
<INTEREST-DEPOSIT> 0
<INTEREST-EXPENSE> 22,881
<INTEREST-INCOME-NET> 59,342
<LOAN-LOSSES> 13,540
<SECURITIES-GAINS> 0
<EXPENSE-OTHER> 32,416
<INCOME-PRETAX> 19,946
<INCOME-PRE-EXTRAORDINARY> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 12,124
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<YIELD-ACTUAL> 10.32
<LOANS-NON> 22,131
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 44,122
<CHARGE-OFFS> (16,992)
<RECOVERIES> 4,020
<ALLOWANCE-CLOSE> 45,014
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 45,014
<FN>
<F1>Aristar, Inc. is technically a Commercial and Industrial Company subject to
Article 5 of Regulation S-X. However, as its primary business is consumer
finance, the Company, although not a bank holding company, is engaged in
similar lending activities. Therefore, in accordance with Staff Accounting
Bulletin Topic 11-K, "Application of Article 9 and Guide 3," the Company has
prepared its Financial Data Schedule for the quarter ended March 31, 1996 using
the Article 9 format.
</FN>
</TABLE>
BULK PURCHASE/SALES AGREEMENT
THIS AGREEMENT, entered into this 30th day of April, 1996, by and between
Great Western Bank, a Federal Savings Bank (hereinafter referred to as "Seller")
and First Community Financial Services, Inc.,a California corporation
(hereinafter referred to as "Buyer"),
WITNESSETH:
WHEREAS, the Seller is the owner of a series of retail installment sales
contracts and security agreements and accounts receivable and all records and
supporting documents for same to include but not limited to ledger cards and
applications pertaining thereto (hereinafter referred to as "Sales Contracts")
and/or a series of promissory notes, contracts, security agreements, deeds of
trust and mortgages and all records and supporting documents for same to include
but not limited to ledger cards and applications pertaining thereto (hereinafter
referred to as "Loan Contracts") held in the name of Seller doing business as
Great Western Financial Services which it desires to sell to Buyer. (The term
"Accounts" as used herein includes all Sales Contracts and/or Loan Contracts as
definedherein and sold hereunder.);
WHEREAS, Buyer is desirous of purchasing such accounts;
NOW, THEREFORE, in consideration of the premises and mutual promises contained
herein, the parties hereto agree as follows:
1. As of the close of business April 30, 1996, hereinafter called
"Base Date," said Sales Contracts total 28,049 in number with total balances
due amounting to $28,966,226.71, and said Loan Contracts totaling 24,662 in
number with total balances due amounting to $175,697,823.13 for the total
Accounts total balances due amounting to $204,664,049.84. Buyer shall pay
Seller by wire transfer of funds to a bank account designated by Seller.
2. For these Accounts, Buyer agrees to pay Seller the sum of $206,781,485.00,
receipt of which is hereby acknowledged by Seller. In addition, Buyer
hereby assumes Seller's deferred state and federal tax liabilities, in the
approximate amount of $1,450,000.00, arising from this transaction. The
parties also agree to make the appropriate net payment for certain
incidental assets and liabilities relating to the Accounts within 60 days of
the date of this Agreement. The purchase price of each account has been
agreed upon based upon the balance on said account as of the Base Date
and Seller warrants and covenants with Buyer that the balance is correct
and that Buyer is entitled to all collections on said account from and after
said date and that they are the property of Buyer, and any such collections
received by Seller prior to closing shall be delivered to Buyer at closing,
and if received by Seller after closing, Seller promises to deliver same in
kind to Buyer within 24 hours after receipt.
<PAGE> 2
3 The Closing shall take place on the date of this Agreement (the "Closing
Date") at Chatsworth, California. At the Closing, Seller shall deliver to
Buyer the Accounts and such assignments and other instruments of sale,
transfer or assignment as counsel for the Buyer may require as necessary or
desirable to sell, assign and transfer all of Seller's right, title and
interest in the Accounts.
4. Seller will execute and deliver to Buyer all necessary and proper
endorsements and assignments required to pass title to said Accounts and
will include all supporting documents pertaining thereto and will transfer
possession of same upon execution of this agreement.
5. Seller hereby warrants, represents and agrees: (a) That Seller is the owner
of all Accounts and has a good right to sell same and that no other party
has or claims to have an interest therein; and (b) Seller will cooperate
with and assist Buyer in enforcing Buyer's rights in, to and under the
terms of any and all accounts purchased hereunder.
6 A number of the Accounts have had credit life and/or accident and health
policies and/or certificates in effect in connection with these Accounts
and/or property insurance on property given as security for those Accounts
written through various insurance companies, with Seller as beneficiary
under the terms of such policies and/or certificates. Seller hereby
assigns all rights, title and interest in and to the said insurance policies
and/or certificates to Buyer.
7. Seller does hereby make, constitute and appoint Buyer and its nominee and
James R. Garner, its true and lawful attorney for and in the name of Seller
with full power to demand, sue for, endorse and receive and collect all of
the accounts and make any necessary repossessions in connection therewith,
and to give effectual receipts, discharges and terminations for the same,
and in the name of Seller and on its own behalf to endorse notes, checks,
money orders, drafts and other evidence of payments, insurance policies or
certificates, and all other instruments as are necessary to accomplish the
foregoing, and to execute and endorse any and all instruments necessary to
assign ownership of said accounts and/or certificates to Buyer or its
assignee and perfect any liens; and it is further agreed that in the event
of the execution of any of the foregoing instruments, that, although not
written therein, all terms, conditions and provisions of this instrument
shall be read into such endorsement, assignment or other instrument executed
for carrying out the purposes of the paragraph.
8. At the Closing, Buyer shall provide Seller with a list of all deposit
accounts securing savings account loans being transferred to Buyer. Seller
agrees to maintain holds on such accounts until the respective security
interests are satisfied and agrees to indemnify and hold Buyer harmless for
any and all losses suffered by Buyer resulting from its failure to do so.
9. Seller further agrees that all accounts shall be notified both by Seller and
Buyer of the fact that the accounts are now the property of the Buyer and
that the Debtors therein shall be expressly directed to make their payments
at the office of the Buyer.
<PAGE> 3
10. Seller shall deliver to Buyer prior to the payment of any portion of the
purchase price specified above, copies of resolutions authorizing or
ratifying the execution of this Agreement by Seller, said resolutions to be
resolutions of the Seller's Board of Directors, as Buyer shall request, or
certificates signed by Seller's secretary certifying to the adoption of such
resolutions.
IN WITNESS WHEREOF, the parties hereto have executed this agreement in person
or by a duly authorized officer on the day and year stated in the commencement.
GREAT WESTERN BANK, A FEDERAL FIRST COMMUNITY FINANCIAL SERVICES, INC.
SAVINGS BANK (A California Corporation)
By: /s/ Stephen F. Adams By: /s/ James R. Garner
Stephen F. Adams James R. Garner
First Vice President Senior Vice President
BULK PURCHASE/SALES AGREEMENT
THIS AGREEMENT, entered into this 30th day of April, 1996, by and between Great
Western Bank, a Federal Savings Bank (hereinafter referred to as "Seller") and
Blazer Financial Services, Inc.,a Florida corporation (hereinafter referred to
as "Buyer"),
WITNESSETH:
WHEREAS, the Seller is the owner of a series of promissory notes, contracts,
securityagreements, deeds of trust and mortgages and all records and supporting
documents for same to include but not limited to ledger cards and applications
pertaining thereto (hereinafter referred to as "Loan Contracts") held in the
name of Seller doing business as Great Western Financial Services which it
desires to sell to Buyer. (The term "Accounts" as used herein includes all
Sales Contracts and/or Loan Contracts as defined herein and sold hereunder.);
WHEREAS, Buyer is desirous of purchasing such accounts;
NOW, THEREFORE, in consideration of the premises and mutual promises contained
herein, the parties hereto agree as follows:
1. As of the close of business April 30, 1996, hereinafter called
"Base Date," said Loan Contracts total 4,078 in number with total Accounts
balances due amounting to $16,452,758.86. Buyer shall pay Seller by wire
transfer of funds to a bank account designated by Seller.
2. For these Accounts, Buyer agrees to pay Seller the sum of $16,501,434.00,
receipt of which is hereby acknowledged by Seller. In addition, Buyer
hereby assumes Seller's deferred state and federal tax liabilities, in the
approximate amount of $35,000.00, arising from this transaction. The
parties also agree to make the appropriate net payment for certain
incidental assets and liabilities relating to the Accounts within 60 days
of the date of this Agreement. The purchase price of each account has been
agreed upon based upon the balance on said account as of the Base Date and
Seller warrants and covenants with Buyer that the balance is correct and
that Buyer is entitled to all collections on said account from and after
said date and that they are the property of Buyer, and any such collections
received by Seller prior to closing shall be delivered to Buyer at closing,
and if received by Seller after closing, Seller promises to deliver same in
kind to Buyer within 24 hours after receipt.
<PAGE> 2
3. The Closing shall take place on the date of this Agreement (the "Closing
Date") at Chatsworth, California. At the Closing, Seller shall deliver to
Buyer the Accounts and such assignments and other instruments of sale,
transfer or assignment as counsel for the Buyer may require as necessary or
desirable to sell, assign and transfer all of Seller's right, title and
interest in the Accounts.
4. Seller will execute and deliver to Buyer all necessary and proper
endorsements and assignments required to pass title to said Accounts and
will include all supporting documents pertaining thereto and will transfer
possession of same upon execution of this agreement.
5. Seller hereby warrants, represents and agrees: (a) That Seller is the owner
of all Accounts and has a good right to sell same and that no other party
has or claims to have an interest therein; and (b) Seller will cooperate
with and assist Buyer in enforcing Buyer's rights in, to and under the terms
of any and all accounts purchased hereunder.
6. A number of the Accounts have had credit life and/or accident and health
policies and/or certificates in effect in connection with these Accounts
and/or property insurance on property given as security for those Accounts
written through various insurance companies, with Seller as beneficiary
under the terms of such policies and/or certificates. Seller hereby assigns
all rights, title and interest in and to the said insurance policies and/or
certificates to Buyer.
7. Seller does hereby make, constitute and appoint Buyer and its nominee and
James R. Garner, its true and lawful attorney for and in the name of Seller
with full power to demand, sue for, endorse and receive and collect all of
the accounts and make any necessary repossessions in connection therewith,
and to give effectual receipts, discharges and terminations for the same,
and in the name of Seller and on its own behalf to endorse notes, checks,
money orders, drafts and other evidence of payments, insurance policies or
certificates, and all other instruments as are necessary to accomplish the
foregoing, and to execute and endorse any and all instruments necessary to
assign ownership of said accounts and/or certificates to Buyer or its
assignee and perfect any liens; and it is further agreed that in the event
of the execution of any of the foregoing instruments, that, although not
written therein, all terms, conditions and provisions of this instrument
shall be read into such endorsement, assignment or other instrument executed
for carrying out the purposes of the paragraph.
8. At the Closing, Buyer shall provide Seller with a list of all deposit
accounts securing savings account loans being transferred to Buyer. Seller
agrees to maintain holds on such accounts until the respective security
interests are satisfied and agrees to indemnify and hold Buyer harmless for
any and all losses suffered by Buyer resulting from its failure to do so.
9. Seller further agrees that all accounts shall be notified both by Seller
and Buyer of the fact that the accounts are now the property of the Buyer
and that the Debtors therein shall be expressly directed to make their
payments at the office of the Buyer.
<PAGE> 3
10. Seller shall deliver to Buyer prior to the payment of any portion of the
purchase price specified above, copies of resolutions authorizing or
ratifying the execution of this Agreement by Seller, said resolutions to be
resolutions of the Seller's Board of Directors, as Buyer shall request, or
certificates signed by Seller's secretary certifying to the adoption of such
resolutions.
IN WITNESS WHEREOF, the parties hereto have executed this agreement in person
or by a duly authorized officer on the day and year stated in the commencement.
GREAT WESTERN BANK, A FEDERAL BLAZER FINANCIAL SERVICES, INC.
SAVINGS BANK (A Florida Corporation)
By: /s/ Stephen F. Adams By: /s/ James R. Garner
Stephen F. Adams James R. Garner
First Vice President Senior Vice President
BULK PURCHASE/SALES AGREEMENT
THIS AGREEMENT, entered into this 30th day of April, 1996, by and between Great
Western Bank, a Federal Savings Bank (hereinafter referred to as "Seller") and
Blazer Financial Services, Inc. of Florida, a Florida corporation (hereinafter
referred to as "Buyer"),
WITNESSETH:
WHEREAS, the Seller is the owner of a series of retail installment sales
contracts and security agreements and accounts receivable and all records and
supporting documents for same to include but not limited to ledger cards and
applications pertaining thereto (hereinafter referred to as "Sales Contracts")
and/or a series of promissory notes, contracts, security agreements, deeds of
trust and mortgages and all records and supporting documents for same to
include but not limited to ledger cards and applications pertaining thereto
(hereinafter referred to as "Loan Contracts") held in the name of Seller doing
business as Great Western Financial Services which it desires to sell to Buyer.
(The term "Accounts" as used herein includes all Sales Contracts and/or Loan
Contracts as defined herein and sold hereunder.);
WHEREAS, Buyer is desirous of purchasing such accounts;
NOW, THEREFORE, in consideration of the premises and mutual promises contained
herein, the parties hereto agree as follows:
1. As of the close of business April 30, 1996, hereinafter called "Base
Date," said Sales Contracts total 4,942 in number with total balances due
amounting to $4,233,047.86, and said Loan Contracts totaling 1,135 in number
with total balances due amounting to $22,209,467.77 for the total Accounts
total balances due amounting to $26,442,515.63. Buyer shall pay Seller by
wire transfer of funds to a bank account designated by Seller.
2. For these Accounts, Buyer agrees to pay Seller the sum of $26,753,945.00,
receipt of which is hereby acknowledged by Seller. In addition, Buyer hereby
assumes Seller's deferred state and federal tax liabilities, in the
approximate amount of $215,000.00, arising from this transaction. The
parties also agree to make the appropriate net payment for certain incidental
assets and liabilities relating to the Accounts within 60 days of the date of
this Agreement. The purchase price of each account has been agreed upon
based upon the balance on said account as of the Base Date and Seller
warrants and covenants with Buyer that the balance is correct and that Buyer
is entitled to all collections on said account from and after said date and
that they are the property of Buyer, and any such collections received by
Seller prior to closing shall be delivered to Buyer at closing, and if
received by Seller after closing, Seller promises to deliver same in kind to
Buyer within 24 hours after receipt.
<PAGE> 2
3. The Closing shall take place on the date of this Agreement (the "Closing
Date") at Chatsworth, California. At the Closing, Seller shall deliver to
Buyer the Accounts and such assignments and other instruments of sale,
transfer or assignment as counsel for the Buyer may require as necessary or
desirable to sell, assign and transfer all of Seller's right, title and
interest in the Accounts.
4. Seller will execute and deliver to Buyer all necessary and proper
endorsements and assignments required to pass title to said Accounts and
will include all supporting documents pertaining thereto and will transfer
possession of same upon execution of this agreement.
5. Seller hereby warrants, represents and agrees: (a) That Seller is the owner
of all Accounts and has a good right to sell same and that no other party
has or claims to have an interest therein; and (b) Seller will cooperate
with and assist Buyer in enforcing Buyer's rights in, to and under the terms
of any and all accounts purchased hereunder.
6. A number of the Accounts have had credit life and/or accident and health
policies and/or certificates in effect in connection with these Accounts
and/or property insurance on property given as security for those Accounts
written through various insurance companies, with Seller as beneficiary
under the terms of such policies and/or certificates. Seller hereby assigns
all rights, title and interest in and to the said insurance policies and/or
certificates to Buyer.
7. Seller does hereby make, constitute and appoint Buyer and its nominee and
James R. Garner, its true and lawful attorney for and in the name of Seller
with full power to demand, sue for, endorse and receive and collect all of
the accounts and make any necessary repossessions in connection therewith,
and to give effectual receipts, discharges and terminations for the same,
and in the name of Seller and on its own behalf to endorse notes, checks,
money orders, drafts and other evidence of payments, insurance policies or
certificates, and all other instruments as are necessary to accomplish the
foregoing, and to execute and endorse any and all instruments necessary to
assign ownership of said accounts and/or certificates to Buyer or its
assignee and perfect any liens; and it is further agreed that in the event
of the execution of any of the foregoing instruments, that, although not
written therein, all terms, conditions and provisions of this instrument
shall be read into such endorsement, assignment or other instrument executed
for carrying out the purposes of the paragraph.
8. At the Closing, Buyer shall provide Seller with a list of all deposit
accounts securing savings account loans being transferred to Buyer. Seller
agrees to maintain holds on such accounts until the respective security
interests are satisfied and agrees to indemnify and hold Buyer harmless for
any and all losses suffered by Buyer resulting from its failure to do so.
9. Seller further agrees that all accounts shall be notified both by Seller
and Buyer of the fact that the accounts are now the property of the Buyer
and that the Debtors therein shall be expressly directed to make their
payments at the office of the Buyer.
<PAGE> 3
10. Seller shall deliver to Buyer prior to the payment of any portion of the
purchase price specified above, copies of resolutions authorizing or
ratifying the execution of this Agreement by Seller, said resolutions to be
resolutions of the Seller's Board of Directors, as Buyer shall request, or
certificates signed by Seller's secretary certifying to the adoption of
such resolutions.
IN WITNESS WHEREOF, the parties hereto have executed this agreement in person
or by a duly authorized officer on the day and year stated in the commencement.
GREAT WESTERN BANK, A FEDERAL BLAZER FINANCIAL SERVICES, INC. OF FLORIDA
SAVINGS BANK (A Florida Corporation)
By: /s/ Stephen F. Adams By: /s/ James R. Garner
Stephen F. Adams, James R. Garner,
First Vice President Senior Vice President
