Exhibit 10.3
PURCHASE AGREEMENT
This Purchase Agreement dated as of July 1, 1998 (the "Agreement"), is
between THE CIT GROUP/CONSUMER FINANCE, INC., as purchaser (the "Purchaser"),
and THE CIT GROUP/CONSUMER FINANCE, INC. (NY), as seller (the "Seller").
Subject to the terms hereof, the Seller agrees to sell, and the Purchaser
agrees to purchase, the home equity mortgage loans set forth on Exhibit A
(collectively, the "Mortgage Loans"), having an aggregate outstanding principal
balance as of July 1, 1998 (the "Cut-off Date") of approximately $17,233,224.37.
It is the intention of the Seller and the Purchaser that the Purchaser
shall sell the Mortgage Loans to The CIT Group Securitization Corporation III
(the "Company") and the Company will sell the Mortgage Loans to The Bank of New
York, as trustee (the "Trustee"), and shall enter into a Pooling and Servicing
Agreement, dated as of the date hereof (the "Pooling and Servicing Agreement"),
with The CIT Group/Consumer Finance, Inc., as seller and master servicer and the
Trustee, pursuant to which Home Equity Loan Asset Backed Certificates, Series
1998-1(the "Certificates"), evidencing ownership interests in the Mortgage
Loans, will be issued.
The Purchaser and the Seller wish to prescribe the terms and conditions of
the purchase by the Purchaser of the Mortgage Loans.
In consideration of the premises and the mutual agreements hereinafter set
forth, the Purchaser and the Seller agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. Certain capitalized terms used in this
Agreement shall have the respective meanings assigned to them in the Pooling and
Servicing Agreement. All references in this Purchase Agreement to Articles,
Sections, subsections and exhibits are to the same contained in or attached to
this Purchase Agreement unless otherwise specified.
ARTICLE II
SALE AND CONVEYANCE OF MORTGAGE LOANS
SECTION 2.01. Sale and Conveyance of Mortgage Loans. On the Closing Date,
subject to the terms and conditions hereof, the Seller shall, and by execution
of this Agreement hereby does, sell, transfer, assign absolutely, set over and
otherwise convey to the Purchaser without recourse, except for the terms of this
Agreement, and the Purchaser shall, and by execution of this Agreement hereby
does, purchase (i) all the right, title and interest of the Seller in and to the
Mortgage Loans, including, without limitation, the security interests in the
related Mortgaged Properties and any related Mortgages and Notes, the Seller's
interest in any related Mortgaged Property which has been acquired by
foreclosure or deed in lieu of foreclosure, and all payments thereon and
proceeds of the conversion thereof, voluntary or involuntary, and all interest
and principal received by the Seller on or with respect to the
Mortgage Loans on and after the Cut-off Date (exclusive of interest due and
payable prior to the Cut-off Date), (ii) all rights under any Hazard Insurance
Policy relating to a Mortgaged Property securing a Mortgage Loan for the benefit
of the creditor of such Mortgage Loan, (iii) the proceeds from any Errors and
Omissions Protection Policy and all rights under any blanket hazard insurance
policy to the extent they relate to the Mortgage Loan or the Mortgaged
Properties related thereto, (iv) all documents contained in the Files with
respect to the Mortgage Loans, and (v) all proceeds in any way derived from any
of the foregoing. The parties intend and agree that the conveyance of the
Seller's right, title and interest in and to the Mortgage Loans pursuant to this
Agreement shall constitute an absolute sale.
The Seller hereby declares and covenants that it shall at no time have any
legal, equitable or beneficial interest in, or any right, including without
limitation any reversionary or offset right, to the Certificate Account, and
that, in the event it receives any of the same, it shall hold same in trust for
the benefit of the Trust on behalf of the Certificateholders and shall
immediately endorse over to the Trust any such amount it receives.
SECTION 2.02. Purchase Price; Payments on the Mortgage Loans.
(a) The purchase price for the Mortgage Loans shall be an amount equal to
$17,233,224.37. Such purchase price shall be payable in immediately available
funds on the Closing Date.
(b) The Purchaser shall be entitled to all payments of principal and
interest received on or after the Cut-off Date. All payments of principal and
interest received before the Cut-off Date shall belong to the Seller. The Seller
shall hold in trust for the Purchaser and shall promptly remit to the Purchaser,
any payments on the Mortgage Loans received by the Seller that belong to the
Purchaser under the terms of this Agreement.
SECTION 2.03. Transfer of Mortgage Loans. Pursuant to a Purchase Agreement
between the Company and the Purchaser, the Purchaser shall transfer all of its
right, title and interest to the Mortgage Loans to the Company and pursuant to
the Pooling and Servicing Agreement, the Company will assign all of its right,
title and interest in and to the Mortgage Loans to the Trustee for the benefit
of the Certificateholders. The Purchaser shall assign its interest under this
Agreement to the Company under and pursuant to a purchase agreement and the
Company shall assign its interest under this Agreement to the Trustee under and
pursuant to the Pooling and Servicing Agreement and the Company and the Trustee
shall succeed to the rights and obligations hereunder of the Purchaser.
SECTION 2.04. Examination of Files. The Seller will make the Files with
respect to the Mortgage Loans available to the Purchaser, its agent and its
assignees and their agents for examination at the Trust's offices or such other
location as otherwise shall be agreed upon by the Purchaser and the Seller.
SECTION 2.05 Recordation of Mortgages. Upon request of the Trustee or the
Master Servicer under the Pooling and Servicing Agreement, at the Seller's
expense, the Seller shall use its best efforts and cooperate in the preparation,
execution and recording of
2
assignments of Mortgages related to the Mortgage Loans required to protect the
interests of the Trustee in the Mortgage Loans and the Mortgaged Property.
ARTICLE III
MISCELLANEOUS PROVISIONS
SECTION 3.01. Amendment. This Agreement may be amended from time to time
by the Seller and the Purchaser by written agreement signed by the Seller, the
Purchaser and the Trustee.
SECTION 3.02. Counterparts. For the purpose of facilitating the execution
of this Agreement as herein provided and for other purposes, this Agreement may
be executed simultaneously in any number of counterparts, each of which
counterparts shall be deemed to be an original, and such counterparts shall
constitute but one and the same instrument.
SECTION 3.03. Termination. The Seller's obligations under this Agreement
shall survive the sale of the Mortgage Loans to the Purchaser.
SECTION 3.04. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.
SECTION 3.05. Notices. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed by
first class mail, postage prepaid, to (i) in the case of the Purchaser, The CIT
Group/Consumer Finance, Inc., 000 XXX Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000,
Attention: President, or such other address as may hereafter be furnished to
Seller in writing by the Purchaser or (ii) in the case of the Seller, The CIT
Group/Consumer Finance, Inc. (NY), 000 XXX Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000,
Attention: President, or such other address as may hereafter be furnished to the
Purchaser by the Seller.
SECTION 3.06. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
SECTION 3.07. Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the Seller and the Purchaser and their respective
successors and assigns, as may be permitted hereunder, including to the benefit
of the Company and the Trustee. The Seller and the Purchaser agree that the
Trustee is an intended third party beneficiary of this Agreement, and that the
Trustee has the right to enforce this Agreement as if it were a party to this
Agreement.
3
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their names
to be signed hereto by their respective officers thereunto duly authorized as of
the day and year first above written.
THE CIT GROUP/CONSUMER FINANCE, INC.,
as Purchaser
By:/s/ Xxxxx Xxxxxx
--------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
THE CIT GROUP/CONSUMER FINANCE, INC. (NY),
as Seller
By:/s/ Xxxxx Xxxxxx
--------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
4
EXHIBIT A
List of Mortgage Loans
