EXHIBIT 10.2
MORTGAGE LOAN PURCHASE AGREEMENT
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This Mortgage Loan Purchase Agreement (the "Agreement"), dated as of
February 27, 2006, is between Xxxxx Fargo Asset Securities Corporation, a
Delaware corporation (the "Company"), and Xxxxx Fargo Bank, N.A., a national
banking association (the "Depositor" or "Xxxxx Fargo Bank").
The Company and the Depositor hereby recite and agree as follows:
1. Defined Terms. Terms used without definition herein shall have
the respective meanings assigned to them in the Pooling and Servicing Agreement,
dated as of February 27, 2006 (the "Pooling and Servicing Agreement"), among the
Company, Xxxxx Fargo Bank, as master servicer (the "Master Servicer") and U.S.
Bank National Association, as trustee (the "Trustee"), relating to the issuance
of the Company's Mortgage Pass-Through Certificates, Series 2006-1 (the
"Certificates") or, if not defined therein, in the underwriting agreement, dated
January 9, 2006 and the terms agreement, dated January 9, 2006 (together, the
"Credit Suisse Underwriting Agreement"), among the Company, Xxxxx Fargo Bank and
Credit Suisse Securities (USA), in the underwriting agreement, dated February 9,
2006 and the terms agreement, dated February 9, 2006 (together, the "Citigroup
Underwriting Agreement" and, together with the Credit Suisse Underwriting
Agreement, the "Underwriting Agreements"), among the Company, Xxxxx Fargo Bank
and Citigroup Global Markets Inc. (together with Credit Suisse Securities (USA),
the "Underwriters") or in the purchase agreement dated May 10, 2004 and the
purchaser terms agreement, dated February 9, 2006 (together, the "Purchase
Agreement"), among the Company, Xxxxx Fargo Bank and Citigroup Global Markets
Inc.
2. Assignment of Servicing Agreements. The Depositor agrees to sell,
and the Company agrees to purchase, the mortgage loans (the "Mortgage Loans"),
other than the Fixed Retained Yield (as defined in the Agreement) with respect
to the Mortgage Loans, listed on the Mortgage Loan Schedule and all of the
Depositor's interest with respect to the Mortgage Loans as the owner in, to and
under each Servicing Agreement (as defined in the Pooling and Servicing
Agreement).
3. Purchase Price; Purchase and Sale. The purchase price (the
"Purchase Price") for the Mortgage Loans shall consist of $[ ] payable by the
Company to the Depositor on the Closing Date in immediately available funds.
Upon payment of the Purchase Price, the Depositor shall be deemed to
have transferred, assigned, set over and otherwise conveyed to the Company all
the right, title and interest of the Depositor in and to the Mortgage Loans
including all interest and principal received or receivable by the Depositor on
or with respect to the Mortgage Loans after the Cut-Off Date (and including
scheduled payments of principal and interest due after the Cut-Off Date but
received by the Depositor on or before the Cut-Off Date and Principal
Prepayments received or applied on the Cut-Off Date, but not including payments
of principal and interest due on the Mortgage Loans on or before the Cut-Off
Date), together with all of the Depositor's right, title and interest in and to
the proceeds of any related title, hazard, primary mortgage or other insurance
policies, the Depositor's right to receive amounts, if any, payable on behalf of
any Mortgagor from the Subsidy Account relating to any Subsidy Loan, the
Seller's right, title and interest in and to the proceeds of the Letters of
Credit, all of the Depositor's rights described in Section 2 above, and all
other property and rights described in the first paragraph of Section 2.01(a) of
the Pooling and Servicing Agreement. The Company hereby directs the Depositor,
and the Depositor hereby agrees, to deliver to the Trustee or Custodian on
behalf of the Trustee, all documents, instruments and agreements required to be
delivered by the Company to the Trustee under the Pooling and Servicing
Agreement; including, without limitation, the documents required to be delivered
under Section 2.01(a) of the Pooling and Servicing Agreement; and upon the
occurrence of a Document Transfer Event, the documents required to be delivered
under Section 2.01(b). The Depositor further agrees to deliver such other
documents, instruments and agreements as the Company or the Trustee shall
reasonably request.
4. Representations and Warranties; Covenants. The Depositor hereby
represents and warrants to the Company that (i) the Company's representations
and warranties to the Trustee pursuant to Section 2.03(b) of the Pooling and
Servicing Agreement are true and correct, as of the date thereof, and (ii)
Depositor has not dealt with any broker, investment banker, agent or other
person (other than the Company, Credit Suisse Securities (USA) and Citigroup
Global Markets Inc.) who may be entitled to any commission or compensation in
connection with the sale of the Mortgage Loans. The Depositor hereby agrees to
cure any breach of such representations and warranties in accordance with the
terms of the Pooling and Servicing Agreement.
The Depositor hereby agrees to continue to pay on behalf of the
Company and its successors and assignees, promptly as they become due, any
lender-paid primary mortgage insurance premiums ("LPMI Premiums") with respect
to any lender-paid primary mortgage insurance policy (an "LPMI Policy") on each
Mortgage Loan so insured as of the Cut-Off Date, until such Mortgage Loan has
been paid in full or otherwise liquidated; provided, however, that the foregoing
obligation of the Depositor shall terminate with respect to all such Mortgage
Loans in the event that either (i) another entity acceptable to the insurers of
such LPMI Policies (the "LPMI Insurers") and the rating agencies rating the
Certificates undertakes to pay such LPMI Premiums, or (ii) the Depositor pays
one-time premiums to such LPMI Insurers such that all outstanding LPMI Policies
will remain in force until the related Mortgage Loans have been paid in full or
otherwise liquidated, without the requirement of any further premium payments.
5. Repurchase or Substitution. (a) The Depositor hereby agrees to
repurchase any Mortgage Loan (i) for which any document is not delivered, as
provided in paragraph 3 above, (ii) which is found by the Trustee or the
Custodian to be defective in any material respect, as provided in the Pooling
and Servicing Agreement, or (iii) which is discovered at any time not to be in
conformance with the representations and warranties referred to in paragraph 4
above and which document relating thereto the Depositor does not deliver or
which defect or breach the Depositor does not cure (as provided in paragraph 4
above) within 60 days after the date of notice thereof from the Trustee or the
Company, at a price equal to the Repurchase Price. In addition, the Depositor
hereby agrees to reimburse the Company for any Reimbursement Amount.
Alternatively, the Depositor hereby agrees, if so requested by the Company to
substitute for any such Mortgage Loan, a new mortgage loan having
characteristics such that the representations and warranties referred to in
paragraph 4 above would not have been incorrect (except for representations and
warranties as to the correctness of the Mortgage Loan Schedule) had such
substitute mortgage loan originally been a Mortgage Loan. The Depositor further
agrees that a substituted mortgage loan will have (i) an unpaid principal
balance no greater than the Scheduled Principal Balance of the Mortgage Loan for
which it is substituted (after giving effect to the scheduled principal payment
due in the month of substitution on the Mortgage Loan for which such mortgage
loan is substituted) and (ii) a Net Mortgage Interest Rate equal to and a
Loan-to-Value Ratio no greater than that of the Mortgage Loan for which it is
substituted. The Depositor shall remit to the Company, in cash, the difference
between the unpaid principal balance of the Mortgage Loan to be substituted and
the unpaid principal balance of the substitute mortgage loan.
(b) In the event that the Depositor has a right against the
originator or former owner of a Mortgage Loan (the "Prior Holder") for breach of
a representation or warranty regarding the characteristics of such Mortgage Loan
made by the Prior Holder, the Depositor may request the Company to repurchase
the Mortgage Loan from the Trust Estate pursuant to Section 3.08 of the Pooling
and Servicing Agreement and the Depositor agrees that at the time of the
repurchase by the Company, the Depositor will repurchase the Mortgage Loan from
the Company at a price equal to the Repurchase Price.
At the time of any such repurchase by the Depositor, the Depositor
agrees either to promptly (i) liquidate such Mortgage Loan, to the extent that
the Depositor's rights in respect of the Prior Holder consist of a claim for
indemnity or (ii) transfer such Mortgage Loan to the Prior Holder at a price not
less than that paid by the Depositor to the Company.
6. Underwriting. The Depositor hereby agrees to furnish any and all
information, documents, certificates, letters or opinions with respect to the
Mortgage Loans, reasonably requested by the Company in order to perform any of
its obligations or satisfy any of the conditions on its part to be performed or
satisfied pursuant to each Underwriting Agreement or the Purchase Agreement at
or prior to the Closing Date.
7. Costs. The Company shall pay all expenses incidental to the
performance of its obligations under each Underwriting Agreement and the
Purchase Agreement, including without limitation (i) any recording fees or fees
for title policy endorsements and continuations, (ii) the expenses of preparing,
printing and reproducing the Prospectus, the Prospectus Supplement, the
Underwriting Agreements, the Private Placement Memorandum, the Purchase
Agreement, the Pooling and Servicing Agreement and the Certificates and (iii)
the cost of delivering the Certificates to the offices of Credit Suisse
Securities (USA) and Citigroup Global Markets Inc. insured to the satisfaction
of Credit Suisse Securities (USA) and Citigroup Global Markets Inc.,
respectively.
8. Servicing. (a) The Depositor hereby represents to the Company
that the Mortgage Loans are serviced by the Servicers. The Depositor has
delivered copies of each Servicing Agreement to the Company, though omitting
schedules of mortgage loans which are serviced thereunder, but which are not
being sold in this transaction.
(b) With respect to each Mortgage Loan, the Servicing Fee Rate and
the Master Servicing Fee Rate (which is in addition to the Servicing Fee Rate)
shall be as set forth on Schedule I hereto.
(c) On the Closing Date, the Depositor shall assign to the Company
its interest with respect to the Mortgage Loans in, to and under each Servicing
Agreement.
9. Notices. All demands, notices and communications hereunder shall
be in writing, shall be effective only upon receipt and shall, if sent to the
Company, be addressed to it at Xxxxx Fargo Asset Securities Corporation, 0000
Xxx Xxxxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxx 00000, Attn: Vice President, Structured
Finance, or, if sent to the Depositor, be addressed to it at Xxxxx Fargo Bank,
N.A., 0000 Xxx Xxxxxxxxxx Xxx, Xxxxxxxxx, Xxxxxxxx, 00000, Attn: Vice President,
Structured Finance.
10. Trustee Beneficiary. The representations, warranties and
agreements made by the Depositor in this Agreement are made for the benefit of,
and may be enforced by, the Trustee and the holders of Certificates to the same
extent that the Trustee and the holders of Certificates, respectively, have
rights against the Company under the Pooling and Servicing Agreement in respect
of representations, warranties and agreements made by the Company therein.
11. Recharacterization. The parties hereto intend the conveyance by
the Depositor to the Company of all of its right, title and interest in and to
the Mortgage Loans pursuant to this Agreement to constitute a purchase and sale
and not a loan. Notwithstanding the foregoing, to the extent that such
conveyance is held not to constitute a sale under applicable law, it is intended
that this Agreement shall constitute a security agreement under applicable law
and that the Depositor shall be deemed to have granted to the Company a first
priority security interest in all of the Depositor's right, title and interest
in and to the Mortgage Loans.
12. Miscellaneous. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York. Neither this Agreement nor
any term hereof may be changed, waived, discharged or terminated except by a
writing signed by the party against whom enforcement of such change, waiver,
discharge or termination is sought. This Agreement may not be changed in any
manner which would have a material adverse effect on holders of Certificates
without the prior written consent of the Trustee. The Trustee shall be protected
in consenting to any such change to the same extent provided in Article VIII of
the Pooling and Servicing Agreement. This Agreement may be signed in any number
of counterparts, each of which shall be deemed an original, which taken together
shall constitute one and the same instrument. This Agreement shall bind and
inure to the benefit of and be enforceable by the Company and the Depositor and
their respective successors and assigns.
IN WITNESS WHEREOF, the Company and the Depositor have caused this
Agreement to be duly executed by their respective officers as of the day and
year first above written.
XXXXX FARGO ASSET SECURITIES
CORPORATION
By:/s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
XXXXX FARGO BANK, N.A.
By:/s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
