First Magnus sets bid procedures for $4.6 million construction loan sale

By Caroline Salls

Pittsburgh, Dec. 10 - First Magnus Financial Corp. requested court approval of the procedures for a proposed $4.6 million sale of some of its construction loans, according to a Monday filing with the U.S. Bankruptcy Court for the District of Arizona.

Summit Investment Group, LLC is the stalking horse bidder.

If Summit is not the high bidder for the construction loans, First Magnus will pay up to $200,000 of its sale-related expenses.

In addition, if broker Bourn Partners, LLC secures a bid that results in a closing price of $4.85 million or more, First Magnus will pay Bourn a 3% broker's commission.

Under the stalking horse agreement, the sale hearing must be held by Jan. 4 and the sale must close by Jan. 11.

Initial overbids must be for at least $250,000 more than Summit's bid, and subsequent bids at auction must be for at least $50,000 more than the previous bid.

All bids must include a $50,000 deposit.

First Magnus, a Tucson, Ariz., mortgage loan originator, filed for bankruptcy on Aug. 21. Its Chapter 11 case number is 07-10578.

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