Exhibit 10.2
Form of Subsequent Mortgage Loan Purchase Agreement
FORM OF SUBSEQUENT MORTGAGE
LOAN PURCHASE AGREEMENT
This Subsequent Mortgage Loan Purchase Agreement dated as of
_______________, 199__ (the "Agreement"), is between THE CIT GROUP
SECURITIZATION CORPORATION III, as purchaser (the "Purchaser"), and THE CIT
GROUP/CONSUMER FINANCE, INC., as seller (the "Seller").
Reference is hereby made to the Mortgage Loan Purchase Agreement dated as
of ______________, 199__ between the parties hereto (the "Purchase Agreement")
pursuant to which the Purchaser purchased from the Seller the mortgage loans set
forth on Exhibit A thereto (the "Initial Mortgage Loans"). The Purchaser sold
the Initial Mortgage Loans to the trust established pursuant to the Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement") dated as of
________________, 199__ among the Purchaser, the Seller, as the seller and as
the master servicer and _______________________________, as trustee (the
"Trustee").
Pursuant to the Pooling and Servicing Agreement, the Purchaser agreed to
purchase from the Seller and the Seller agreed to sell to the Purchaser, subject
to the terms and conditions set forth in Section _____ of the Pooling and
Servicing Agreement, Subsequent Mortgage Loans for the fixed purchase price
specified in the Pooling and Servicing Agreement for delivery on the date
specified therein. The purchase price for any Subsequent Mortgage Loan will be
funded from money on deposit in the Pre-Funding Account during the Funding
Period. The purchase of any Subsequent Mortgage Loan by the Purchaser must be
evidenced by the execution and delivery of a Subsequent Mortgage Loan Purchase
Agreement substantially in the form of Exhibit __ to the Pooling and Servicing
Agreement. Accordingly, subject to the terms hereof and the Pooling and
Servicing Agreement, the Seller agrees to sell, and the Purchaser agrees to
purchase, the mortgage loans set forth on Exhibit A hereto (collectively, the
"Subsequent Mortgage Loans"), having an aggregate outstanding principal balance
as of _____________, 199__ (the "Subsequent Cut-Off Date") of $______________.
The Purchaser and the Seller wish to prescribe the terms and conditions of
the purchase by the Purchaser of the Subsequent Mortgage Loans and the servicing
and administration of the Subsequent 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 1.1. 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 Agreement to Articles, Sections, subsections
and exhibits are to the same contained in or attached to this Agreement unless
otherwise specified.
ARTICLE II
SALE AND CONVEYANCE OF SUBSEQUENT MORTGAGE LOANS;
MORTGAGE LOAN FILES
SECTION 2.1. Sale and Conveyance of Contracts. On ____________, 199__ (the
"Subsequent Transfer Date") subject to the terms and conditions hereof, the
Seller shall sell, transfer, assign absolutely, set over and otherwise convey to
the Purchaser as of the Subsequent Transfer Date (i) all the right, title and
interest of the Seller in and to the Subsequent Mortgage Loans and all the
rights, benefits, and obligations arising from and in connection with each
Subsequent Mortgage Loan, (ii) an assignment of the security interests in the
Subsequent Mortgaged Properties granted by the Mortgagors pursuant to the
Subsequent Mortgage Loans, (iii) all payments received by the Seller on or with
respect to the Subsequent Mortgage Loans on or after the Subsequent Cut-off
Date, (iv) the interest of the Seller in any Subsequent Mortgaged Property
(including any right to receive future Net Liquidation Proceeds) that secures
the Subsequent Mortgage Loans; (v) all rights of the Seller to proceeds of
Insurance Policies covering the Mortgagors and the Subsequent Mortgage Loans,
(vi) the proceeds from any Master Servicer's Errors and Omissions Protection
Policy, any fidelity bond and any blanket physical damage policy, to the extent
such proceeds relate to any Subsequent Mortgaged Property, (vii) all rights of
recourse against any cosigner or under any personal guarantee with respect to
the Subsequent Mortgage Loans; (viii) all proceeds in any way derived from any
of the foregoing items, and (ix) all documents contained or required to be
contained in the Mortgage Loan Files relating to the Subsequent Mortgage Loans.
The parties intend and agree that the conveyance of the Seller's right, title
and interest in and to the Subsequent Mortgage Loans (and all rights,
entitlements and amounts listed above) pursuant to this Agreement shall
constitute an absolute sale.
SECTION 2.2. Purchase Price; Payments on the Subsequent Mortgage Loans.
The purchase price for the Subsequent Mortgage Loans shall be an amount
equal to $________________, which is the aggregate outstanding principal balance
of the Subsequent Mortgage Loans transferred pursuant to this Agreement as of
the Subsequent Cut-off Date, and the Seller hereby acknowledges receipt of such
amount in respect of the sale of the Subsequent Mortgage Loans hereunder. Such
purchase price shall be payable in immediately available funds on the Subsequent
Transfer Date from funds on deposit in the Pre-Funding Account.
2
The Purchaser shall be entitled to all payments of principal and interest
received on or after the Subsequent Cut-off Date. All payments of principal and
interest received before the Subsequent 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 Subsequent Mortgage Loans received by the Seller
that belong to the Purchaser under the terms of this Agreement.
SECTION 2.3. Conditions to Sale of Subsequent Contracts. The Purchaser's
obligations hereunder are subject to the following conditions:
1. The Purchaser shall have received:
a. the Pooling and Servicing Agreement executed by all the parties
thereto,
b. the documents listed in Section______ of the Pooling and
Servicing Agreement, and
c. such other opinions and documents as the Purchaser may reasonably
require in connection with the purchase of the Subsequent
Mortgage Loans hereunder or the sale of the Certificates;
2. The representations and warranties with respect to the Subsequent
Mortgage Loans of (i) the Seller and the Master Servicer made in the
Pooling and Servicing Agreement and (ii) the Seller made in the
Purchase Agreement and this Agreement shall be true and correct with
respect to the Subsequent Mortgage Loans on the Subsequent Transfer
Date; and
3. The conditions for transfer of the Subsequent Mortgage Loans from the
Purchaser to the Trust set forth in Section _____ of the Sale and
Servicing Agreement have been fulfilled.
SECTION 2.4. Examination of Files. The Seller will make the Mortgage Loan
Files with respect to the Subsequent Mortgage Loans available to the Purchaser
or its agent for examination at the Trust's offices or such other location as
otherwise shall be agreed upon by the Purchaser and the Seller.
SECTION 2.5. Transfer of Subsequent Contracts. Pursuant to the Pooling and
Servicing Agreement, the Purchaser will assign all of its right, title and
interest in and to the Subsequent Mortgage Loans to the Trust for the benefit of
the Certificateholders. The Purchaser has the right to assign its interest under
this Agreement as may be required to effect the purposes of the Pooling and
Servicing Agreement, by written notice to the Seller and without the consent of
the Seller, and the assignee shall succeed to the rights and obligations
hereunder of the Purchaser.
3
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
SECTION 3.1. Representations and Warranties of the Seller.
(a) The representations and warranties of the Seller contained in Article
____ of the Pooling and Servicing Agreement with respect to the Subsequent
Mortgage Loans are incorporated herein, and are made to the Purchaser on the
Subsequent Transfer Date, 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 become
obligated in respect of such representations and warranties pursuant to Article
___ of the Pooling and Servicing Agreement. On the Subsequent Transfer Date, the
Seller shall deliver to the Purchaser an Officers' Certificate, dated the
Subsequent Transfer Date, to the effect that the representations and warranties
made in the Pooling and Servicing Agreement with respect to the Subsequent
Mortgage Loans by the Seller are true and correct as of the Subsequent Transfer
Date.
(b) It is understood and agreed that the representations and warranties
incorporated by reference in this Agreement by Section 3.1(a) hereof shall
remain operative and in full force and effect, shall survive the transfer and
conveyance of the Subsequent 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.
(c) The Seller shall indemnify the Purchaser and the Master Servicer and
hold the Purchaser and the 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 3.1 to indemnify the Purchaser and the Master Servicer as provided in
this Section 3.1 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 from the Seller to
an indemnified party of its election to assume the defense thereof, the Seller
will not be liable to such indemnified party under this Section for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof.
4
(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 3.1 shall accrue as to any Subsequent Mortgage Loan
upon discovery of such breach by the Purchaser or the Master Servicer or notice
thereof by the Seller to the Purchaser and the Master Servicer, failure by the
Seller to cure such breach and demand upon the Seller by the Purchaser for all
amounts payable in respect of such Subsequent Mortgage Loan.
ARTICLE IV
MISCELLANEOUS PROVISIONS
SECTION 4.1. Amendment. This Agreement may be amended from time to time by
the Seller and the Purchaser by written agreement signed by the Seller and the
Purchaser.
SECTION 4.2. 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 4.3. Termination. The Seller's obligations under this Agreement
shall survive the sale of the Subsequent Mortgage Loans to the Purchaser.
SECTION 4.4. 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 4.5. 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 in the case of the Seller, 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
Purchaser in writing by the Seller, or in the case of the Purchaser, The CIT
Group Securitization Corporation III, 000 XXX Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx
00000, Attention: President, or such other address as may hereafter be furnished
to the Seller by the Purchaser.
SECTION 4.6. 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 4.7. 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.
5
SECTION 4.8. Opinion. The Counsel to the Seller shall deliver to the
Purchaser and the Trustee an opinion in the form of Exhibit B hereto.
6
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 SECURITIZATION
CORPORATION III,
as Purchaser
By:____________________________________
Name:__________________________________
Title:_________________________________
THE CIT GROUP/CONSUMER FINANCE, INC.,
as Seller
By:____________________________________
Name:__________________________________
Title:_________________________________
EXHIBIT A
List of Subsequent Mortgage Loans
EXHIBIT B
FORM OF OPINION OF COUNSEL
________________, 199__
[Trustee]
[Address]
Dear Ladies and Gentlemen:
I have acted as counsel to The CIT Group/Consumer Finance, Inc., a Delaware
corporation ("CIT Consumer Finance") and The CIT Group Securitization
Corporation III, a Delaware corporation (the "Company"), in connection with the
sale of CIT Home Equity Loan Trust 199_-_ Asset Backed Certificates (the
"Certificates"). The Certificates represent interests in, a trust, the CIT Home
Equity Loan Trust 199_-_ (the "Trust"), consisting of a pool of mortgage loans
secured by residential properties (collectively, the "Mortgage Loans") and
certain related property. The Company purchased certain of the Mortgage Loans
from CIT Consumer Finance (the "Initial Mortgage Loans") pursuant to a Mortgage
Loan Purchase Agreement, dated as of __________, 199__, by and between CIT
Consumer Finance and the Company. Additional Mortgage Loans are being purchased
by the Company from CIT Consumer Finance (the "Subsequent Mortgage Loans")
pursuant to the Subsequent Mortgage Loan Purchase Agreement dated as of
_______________, 199__ (the "Subsequent Purchase Agreement"). Pursuant to a
Pooling and Servicing Agreement, dated as of ______________, 199__ (the "Pooling
and Servicing Agreement"), among the Company, CIT Consumer Finance, as seller
and as master servicer and the [Trustee], as trustee (the "Trustee"), the
Company transferred the Initial Mortgage Loans to the Trust. The Company will
also transfer, pursuant to the Pooling and Servicing Agreement, the Subsequent
Mortgage Loans to the Trust, the corpus of which will consist of each of the
Initial Mortgage Loans and the Subsequent Mortgage Loans and certain other
property transferred by the Company to the Trust.
All capitalized terms used herein and not defined shall have the meanings
assigned to them in the Subsequent Purchase Agreement.
In rendering the following opinions, I have examined (i) the Subsequent
Purchase Agreement; (ii) the Pooling and Servicing Agreement; (iii) the
Certificate of Incorporation of
B-1
each of CIT Consumer Finance and the Company; (iv) the By-Laws of each of CIT
Consumer Finance and the Company; (v) copies of certain unanimous written
consents adopted by the Board of Directors of the Company authorizing the
issuance and sale of the Certificates and the purchase of the Mortgage Loans;
and (vi) copies of certain unanimous written consents of the Board of Directors
of CIT Consumer Finance. I have also examined such other documents and made such
investigations of law as I have considered necessary and appropriate for the
purposes of the opinions expressed herein. I have assumed the authenticity of
signatures on original documents and the conformity to the original of all
documents submitted to me as certified, conformed or photostatic copies and have
relied as to all matters of fact on certificates, representations or statements
by officers of the Company or CIT Consumer Finance.
In making my examination of agreements, instruments and other documents and
in giving opinions herein, I have assumed that the Trustee has and had the power
and capacity to execute and deliver such agreements, instruments and other
documents and to perform all of their obligations thereunder and that such
agreements, instruments and other documents were duly authorized by all
requisite action by or on behalf of the Trustee were duly executed,
acknowledged, as necessary, and delivered by or on behalf of and are the legal,
valid and binding obligations of, and are enforceable in accordance with their
terms against, the Trustees.
Based upon, and subject to, the foregoing I am of the opinion that:
1. The Subsequent Purchase Agreement has been duly authorized, executed and
delivered by each of CIT Consumer Finance and the Company and constitutes the
legal, valid and binding agreement of each of CIT Consumer Finance and the
Company, and is enforceable against each of CIT Consumer Finance and the Company
in accordance with its terms; the Subsequent Purchase Agreement is effective to
transfer all of CIT Consumer Finance's right, title and interest in and to the
Subsequent Mortgage Loans and other property described in Section 2.1 of the
Subsequent Purchase Agreement to the Company; the Pooling and Servicing
Agreement is effective to transfer all of the Company's right, title and
interest in and to such Subsequent Mortgage Loans and other property to the
Trust subject to no prior liens or encumbrances.
2. No consent, approval, authorization or order of, registration or filing
with, or notice to any governmental authority or court is required under federal
laws or the laws of the State of Delaware for the execution, delivery and
performance by the Company of the Subsequent Purchase Agreement or the
consummation of any other transaction contemplated thereby by the Company,
except for those which have been obtained or except such as may be required
under the Securities Act of 1933, as amended or the regulations promulgated
thereunder or state securities or Blue Sky laws of any jurisdiction.
3. No consent, approval, authorization or order of, registration or filing
with, or notice to, any governmental authority or court is required under
federal laws or the laws of the State of Delaware for the execution, delivery
and performance by CIT Consumer Finance of the Subsequent Purchase Agreement or
the consummation of any other transaction contemplated
B-2
thereby by CIT Consumer Finance except for those which have been obtained or
except such as may be required under the Securities Act of 1933, as amended or
the regulations promulgated thereunder or state securities or Blue Sky laws of
any jurisdiction.
I am furnishing this opinion to you solely for your benefit. This opinion
is not to be used, circulated, quoted or otherwise referred to or relied on by
any other person or for any other purpose.
The foregoing opinion is given on the express understanding that the
undersigned is an officer of the Company and CIT Consumer Finance and shall in
no event incur any personal liability in connection with the said opinion.
Very truly yours,
B-3
