Exhibit 10.1
PURCHASE AGREEMENT
This Purchase Agreement dated as of July 1, 1998 (the "Agreement"), is
between THE CIT GROUP/CONSUMER FINANCE, INC., as seller (the "Seller"), and THE
CIT GROUP/SECURITIZATION CORPORATION III, as purchaser (the "Purchaser ").
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
$341,424,511.24.
It is the intention of the Seller and the Purchaser that the Purchaser
shall 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,
(v) all rights under the CITCF-NY Purchase Agreement and the CITSF Purchase
Agreement and (vi) 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
$341,424,511.24. 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 the Pooling and
Servicing Agreement, the Purchaser 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 Trustee under and pursuant to the Pooling and Servicing Agreement 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.
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SECTION 2.05 Conditions to Sale of Mortgage Loans. The Purchaser's
obligations hereunder are subject to the following conditions:
(a) The Purchaser shall have received (i) the Pooling and Servicing
Agreement executed by all the parties thereto, (ii) all documents required by
the Pooling and Servicing Agreement and (iii) such other opinions and documents
as the Purchaser may reasonably require in connection with the purchase of the
Mortgage Loans hereunder or the sale of the Certificates;
(b) The representations and warranties of the Seller and the Master
Servicer made in the Pooling and Servicing Agreement shall be true and correct
on the Closing Date; and
(c) The Purchaser shall have received from counsel to the Seller a letter
stating that the Purchaser may rely on such counsel's opinion delivered pursuant
to the Pooling and Servicing Agreement and such counsel's opinions to Xxxxx'x
Investors Service, Inc. and Standard and Poor's Ratings Service in respect of
the sale of the Mortgage Loans to the Purchaser by the Seller, or such opinions
may be addressed and delivered to the Purchaser.
SECTION 2.06 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 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
REPRESENTATIONS AND WARRANTIES OF THE SELLER;
REPURCHASE OF MORTGAGE LOANS
SECTION 3.01 Representations and Warranties of the Seller.
(a) The representations and warranties of the Seller contained in the
Pooling and Servicing Agreement are incorporated herein, and are made to the
Purchaser on the date hereof, as if set forth herein and as if made to the
Purchaser on the date hereof. The Seller will make such representations and
warranties in the Pooling and Servicing Agreement directly to the Trust and will
be obligated in respect of such representations and warranties pursuant to the
Pooling and Servicing Agreement. On the Closing Date, the Seller shall deliver
to the Purchaser an Officer's Certificate, dated the Closing Date, to the effect
that the representations and warranties made in the Pooling and Servicing
Agreement by the Seller are true and correct as of the Closing Date.
(b) It is understood and agreed that the representations and warranties
incorporated by reference in this Agreement by Section 3.01(a) hereof shall
remain operative and in full force and effect, shall survive the transfer and
conveyance of the Mortgage Loans by the Seller to the Purchaser and by the
Purchaser to the trust, and shall inure to the benefit of the Purchaser, the
Trust and their successors and permitted assignees.
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(c) The Seller shall indemnify the Purchaser and the Master Servicer and
hold the Purchaser and Master Servicer harmless against any loss, penalties,
fines, forfeitures, legal fees and related costs, judgments and other costs and
expenses resulting from any claim, demand, defense or assertion based on or
grounded upon, or resulting from, a breach of the Seller's representations and
warranties contained or incorporated by reference in this Agreement. It is
understood and agreed that the obligation of the Seller set forth in this
Section 3.01 to indemnify the Purchaser and the Master Servicer as provided in
this Section 3.01 constitutes the sole remedy of the Purchaser and the Master
Servicer respecting a breach of the foregoing representations and warranties.
The Trust shall also have the remedies provided in the Pooling and Servicing
Agreement.
(d) Each indemnified party shall give prompt notice to the Seller of any
action commenced against it with respect to which indemnity may be sought
hereunder but failure to so notify an indemnifying party shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement, unless the failure to notify materially prejudices the rights and
condition of the Seller. The Seller shall be entitled to participate in any such
action, and to assume the defense thereof, and after notice form the Seller to
an indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof.
(e) Any cause of action against the Seller or relating to or arising out
of the breach of any representations and warranties made or incorporated by
reference in this Section 3.01 shall accrue as to any Mortgage Loan upon (i)
discovery of such breach by the Purchaser or the Master Servicer or notice
thereof by the Seller to the Purchaser and the Master Servicer, (ii) failure by
the Seller to cure such breach and (iii) demand upon the Seller by the Purchaser
for all amounts payable in respect of such Mortgage Loan.
ARTICLE IV
MISCELLANEOUS PROVISIONS
SECTION 4.01. 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 4.02. 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 4.03. Termination. The Seller's obligations under this Agreement
shall survive the sale of the Mortgage Loans to the Purchaser.
SECTION 4.04. 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.
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SECTION 4.05. 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 4.06. 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 4.07. 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. 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.
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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 Seller
By:/s/ Xxxxx Xxxxxx
--------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
THE CIT GROUP SECURITIZATION
CORPORATION III,
as Purchaser
By:/s/ Xxxxx Xxxxxx
--------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
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EXHIBIT A
List of Mortgage Loans
