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Exhibit 99.2
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CITYSCAPE CORP.
MASTER AGREEMENT FOR SALE AND PURCHASE OF
MORTGAGES
BY AND BETWEEN
,SELLER
AND
CITYSCAPE CORP., BUYER
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MASTER AGREEMENT FOR SALE AND PURCHASE OF MORTGAGES
This Master Agreement for Sale and Purchase of Mortgages is made this
______ day of ____________, 19____, by and between Cityscape Corp., located at
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, a Corporation organized and existing under
the laws of New York ("Buyer") and ___________________________________________,
located at __________________________________________, a Corporation organized
and existing under the laws of ________________________________ ("Seller").
I. RECITALS
WHEREAS, the Seller desires from time to time to offer for sale
to the Buyer and the Buyer desires from time to time to purchase from the
Seller on the terms and subject to the conditions set forth herein certain
Loans owned by the Seller evidenced by notes and secured by mortgages of the
agreed-upon priority on real property, and possibly additionally secured by
security interests in personal property, owned by the borrowers ("Borrowers").
WHEREAS, the Buyer and the Seller desire to enter into this
Agreement to govern the sale and purchase of said Loans.
Now, therefore, in consideration of the above recitals and the
mutual covenants contained herein, the parties hereto hereby agree as follows:
II. DEFINITIONS
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the following
meanings:
(A) AGREEMENT: shall mean this Agreement as may be amended
and supplemented from time to time. The parties agree that this Agreement shall
be used as the master purchase agreement for those Loans purchased by Buyer
from Seller in the future, unless otherwise agreed to in writing by the parties.
(B) LOAN: the Note, the related Mortgage, the related Other
Collateral, and the related Assets are referred to as "Loan," and collectively
as "Loans."
(C) ESSENTIAL MORTGAGE FILE DOCUMENTS: as to each Mortgage
Loan, the original of the Note, Mortgage, Other Collateral, title insurance
policy including endorsements or "marked-up" title commitment, appraisal,
Related Assets and the accidental documents as required by Buyer from time to
time.
(D) MIXED-USE OR MULTI-FAMILY LOAN: a loan secured by real
property on which is situated a mixed-use or multi-family (more than
four-family) dwelling.
(E) MORTGAGE: the mortgage, deed of trust or similar
instrument securing real property.
(F) OTHER COLLATERAL: any security agreement securing
personal property, any guaranty, any separate assignment of rents and any other
security interest aside from the Mortgage.
(G) PURCHASE PRICE: the Purchase Price for the Loan(s)
described on each Schedule of Loans Delivered shall be an amount as of the
Settlement Date equal to the sum of: (1) the unpaid principal balance(s) of the
Note(s); (2) all interest accrued (up to but not including the Settlement Date)
but unpaid on the Note(s) (prorated on a 30-day month - 360-day year); and (3)
any premiums due Seller, if applicable, in accordance with the Approval Advice
or Schedule of Loans Delivered; (4) less any discount due Buyer, if applicable,
in accordance with the Approval Advice or Schedule of Loans Delivered; and (5)
less the amount deducted for a Reserve Account, if applicable.
(H) RELATED ASSETS: the documents as further defined in
Article IV(A)(4) of this Agreement.
(I) SETTLEMENT DATE: the date of the funding or payments of
the Purchase Price by the Buyer for Loans purchased pursuant to this Agreement.
Each Settlement shall be held at the offices of Cityscape Corp., ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, or at such other place or in such other manner,
i.e. by mail, as may be agreed to by the parties.
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(J) UNDERWRITING GUIDELINES/PURCHASING GUIDELINES: as may be
determined from time to time by Buyer.
(K) The terms Loan to Value Rate, "Marked-up" Title Insurance
Policy, Binder or Certificate, Mortgaged Property or Subject Property,
Mortgagor or Borrower as utilized in this Agreement shall have the meaning such
words and phrases are generally given in agreements contemplating the purchase
and sale of mortgage loans.
III. OFFER TO SELL AND ACCEPTANCE OF OFFER
(A) OFFER. The Seller may offer from time to time to submit to
the Buyer a list of Loans, along with the Essential Mortgage File Documents, as
defined herein, for each of such Loans, for the Buyer's review. The Buyer shall
then deliver to the Seller a Schedule of Loans Delivered on which the Buyer has
indicated which Loans, if any, the Buyer is offering to purchase from the
Seller and the Purchase Price offered to be paid for the Loans Buyer is
willing to purchase.
(B) ACCEPTANCE. The Seller shall endorse the Notes and
endorse or assign the Mortgages and Other Collateral evidencing the Loans on
which the Seller agrees to accept the Buyer's offer to purchase. Such
endorsement and assignment shall constitute the Seller's acceptance of the
Buyer's offer to purchase the indicated Loans pursuant to the terms and
conditions of this Agreement.
On occasion, Buyer may issue Seller a written Approval Advice
in the form attached hereto, made a part hereto and marked EXHIBIT "A," to
cover a specific Loan purchase by Buyer hereunder which is approved by Buyer in
advance of said specific Loan being made by Seller. Any purchase made hereunder
that is subject to an Approval Advice shall be governed first by the terms of
such Approval Advice and then by the terms of this Agreement, and to the extent
of a conflict between the Approval Advice and this Agreement, the Approval
Advice shall govern for that purchase and only that purchase.
Buyer shall have the absolute and sole discretion and option to
agree or decline to purchase any Loan(s) submitted by Seller for review.
IV. PURCHASE AND SALE OF LOANS
(A) DELIVERY OF LOANS. On or before the business day
immediately preceding each Settlement Date, the Seller shall deliver to the
Buyer the following for each Loan purchased:
1. Those Loans described by the Buyer on each Schedule of
Loans Delivered which are purchased by Buyer pursuant to this agreement.
2. The agreed-upon priority Mortgages and Other Collateral on
Subject Property.
3. The Note(s), the Mortgage(s) and the Other Collateral
endorsed by an authorized Officer of Seller to the Buyer pursuant to the
language set forth on EXHIBIT "B," attached hereto and made a part hereof,
and/or assigned in the form required by Buyer, together with individual
assignments to the Buyer (a certified copy of the recordable or fileable
assignment) and originals of all intervening assignments, if any, of the
Seller's beneficial interest in the Mortgage and in the Other Collateral,
showing a complete chain of title from origination to the Seller, including
warehousing assignment, with evidence of recording thereon.
4. Any and all documents, instruments, collateral agreements,
assignments and endorsements for all documents, instruments and collateral
agreements, referred to in the Notes, Mortgages, and/or Other Collateral or
related thereto, including, without limitation, current applicable insurance
policies (such as private mortgage insurance, flood insurance, hazard insurance
and title insurance) covering the Subject Property or relating to the Notes and
all files, books, papers, ledger cards, reports and records, including, without
limitation, loan applications, Borrower financial statements, credit reports
and appraisals, relating to the Loans (the "Related Assets"). In all cases, the
Related Assets shall be the original documents.
5. The Essential Mortgage File Document List, including all
writing evidencing the Loan(s) purchased by Buyer. In all cases, these
documents shall be the original documents.
6. In the event that Seller cannot deliver to Buyer a duly
recorded assignment of Mortgage or any other document required to be recorded
under this Agreement on the Settlement Date solely because of a delay caused
by the public recording office when such document(s) has(have) been delivered
for recordation, Seller shall deliver to the Buyer a certified copy of each
such document(s) with a statement thereon signed by an Officer of the Seller
certifying each to be a true and correct copy of such document(s) delivered to
the appropriate public recording official for recordation. Seller shall deliver
to Buyer such recorded document(s) with evidence indicated thereon no later
than 15 days after Seller receives such document, but in any event, no later
than 90 days from the Settlement Date.
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(B) PURCHASE AND SALE. On each Settlement Date hereunder,
Seller shall sell, assign, transfer, convey and deliver to Buyer all of its
right, title and interest in and to the Loans, assets and documents as more
fully enumerated and set forth in Article IV(A)(1) through (6) inclusive, which
are incorporated herein by reference.
(C) PAYMENT OF PURCHASE PRICE. The Purchase Price for the Loans
described on each Schedule of Loans Delivered shall be an amount as defined in
Article II(G), above. The Purchase Price shall be payable as follows: on each
Settlement Date, the Buyer shall deposit funds by federal wire transfer to the
Seller's bank at: _______________________________, or to such account as shall
be designated from time to time by Seller.
(D) PREMIUM REBATE. In the event that a premium is paid by the
Buyer to the Seller on a Loan and such Loan is prepaid by the Borrower, whether
voluntarily or involuntarily following acceleration after default, within
twelve (12) months of the Settlement Date, other than by a refinancing by the
Buyer or any of its subsidiaries or affiliates or a refinancing by the Seller
which is purchased by the Buyer, the Seller shall, upon demand by the Buyer,
refund to the Buyer, in the appropriate percentage specified below, the premium
paid by the Buyer to the Seller. In the event such Loan is prepaid within
thirty (30) days of the Settlement Date of such Loan, the refund due Buyer from
Seller will equal one hundred (100%) percent of the premium paid to Seller by
Buyer for such Loan. In the event such Loan is prepaid later than twelve (12)
months from the Settlement Date of such Loan, no refund shall be due. The
amount of the premium to be refunded shall be determined as follows:
Day:
31-60 91.67%
61-90 83.33%
91-120 75.00%
121-150 66.67%
151-180 58.33%
181-210 50.00%
211-240 41.67%
241-270 33.33%
271-300 25.00%
301-330 16.67%
331-365 8.33%
V. REPRESENTATIONS AND WARRANTIES OF THE SELLER
(A) REPRESENTATIONS AND WARRANTIES OF THE SELLER-GENERAL. It
is understood and agreed by Seller and Buyer that as a material inducement to
Buyer to enter into this Agreement the Seller hereby represents and warrants to
the Buyer as follows:
1. The Seller is an organization as set forth in the
introductory paragraph of this Agreement and is duly organized, validly
existing and in good standing under the laws of the state of its incorporation,
and is duly qualified as a foreign corporation in all jurisdictions wherein the
character of the property owned or leased or the nature of the business
transacted by it makes qualification as a foreign corporation necessary.
2. The execution and delivery of this Agreement by the Seller
and the performance by the Seller of the obligations to be performed by it
hereunder have been duly authorized by all necessary corporate or other similar
action. Prior to the first Settlement Date, the Seller shall deliver to the
Buyer certified copies of relevant corporate or similar resolutions and a good
standing certificate for the state of its incorporation and, as requested by
Buyer, for each state in which Seller is registered to do business.
3. The execution and delivery of this Agreement by the Seller
and the performance by the Seller of the obligations to be performed by it
hereunder do not, and will not, violate any provision of any law, rule,
regulation, order, writ, judgment, injunction, decree, determination or award
presently in effect having applicability to the Seller or to the charter or
bylaws of the Seller. All parties which have had any interest in the Mortgage,
or the Other Collateral, whether as mortgagee, secured party, assignee (other
than Buyer or assignee of Buyer) or pledgee are (or during the period in which
they held and disposed of such interest, were) in compliance with all
applicable licensing requirements of the federal, state, and local government
wherein the Subject Property is located.
4. The execution and delivery of this Agreement by the Seller
and the performance by the Seller of the obligations to be performed by it
hereunder do not and will not result in a breach of or constitute a default
under any indenture, loan, credit agreement or any other agreement, lease or
instrument to which the Seller is a party or by which it or its properties may
be bound or affected.
5. This Agreement constitutes, when duly executed and delivered
by the Seller, a legal, valid and binding obligation of the Seller, enforceable
against the Seller according to its terms, except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, receivership, moratorium, or
similar laws affecting creditors' rights in general, including equitable
remedies.
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6. The Seller is not in default with respect to any order or decree of
any court or any order, regulation or demand of any federal, state, municipal
or other governmental agency, which default might have consequences that would
materially and adversely affect the condition (financial or other) or
operations of the Seller or its properties or might have consequences that
would materially and adversely affect its performance hereunder.
7. There are no actions, suits or proceedings pending or, to the
knowledge of the Seller, threatened against or affecting the Seller or the
properties of the Seller before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
which if determined adversely to the Seller, would have a material adverse
effect on the financial condition, properties or operation of the Seller.
(B) REPRESENTATIONS AND WARRANTIES OF THE SELLER AS TO EACH LOAN. It is
understood and agreed by Seller and Buyer that as a material inducement for
Buyer to enter into this Agreement, the Seller hereby represents and warrants
to the buyer as of each Settlement Date with respect to each Loan purchased:
1. The Seller is the originator of the Note, Mortgage and Other
Collateral, and the Seller is a holder-in-due-course of each Note within the
meaning of the Uniform Commercial Code. Seller is the sole owner of the Loan
and has the right to assign and transfer the Loan to the Buyer. The Seller has
not sold, assigned or otherwise transferred any right or interest in or to the
Loan and has not pledged the Loan as collateral for any loan or obligation of
Seller or for any other purpose, except in connection with its warehouse lines
of credit, which security interest or pledges have been released at or prior to
the time of the sale of the Loan to the Buyer. The assignment of the Loan by
the Seller to Buyer validly transfers the Loan to Buyer free and clear of any
pledges, liens, claims, encumbrances, mortgages, charges, exceptions and/or
security interests.
2. Except as expressly disclosed to and agreed to by the Buyer in
writing, the Loan conforms to: (a) the Underwriting Guidelines of Buyer, and
(b) the conditions of the Approval Advice (if applicable).
3. All information set forth in any Schedule of Loans Delivered is true
and correct in all respects, and all other information furnished to Buyer by
Seller with respect to the Loan(s) purchased is true and correct as of the
Settlement Date.
4. The Note, Mortgage, Other Collateral and the Related Assets are in
every respect genuine, are the valid instrument they purport on their face to
be, are the legal, valid, binding and enforceable obligation of the Borrower
and other obligors thereunder and are not subject to any discount, allowance,
setoff, counterclaim, presently pending bankruptcy or other defenses; none of
the Note, Mortgage, Other Collateral or Related Assets are forged or have
affixed thereto any unauthorized signature or have been entered into by any
persons lacking legal capacity; and no foreclosure (including any non-judicial
foreclosure) or any other legal action has been brought by the Seller or any
senior lienholder in connection therewith.
5. If the loan is a Mixed-Use or Multi-Family Loan, the Loan documents
have been approved for use by the Buyer and the Seller has not altered any of
the terms or conditions set forth therein without the prior written approval of
the Buyer.
6. If the Loan is a Mixed-Use or Multi-Family Loan, the closing thereof
took place in the office of a law firm approved by the Buyer.
7. No instruments other than those delivered herewith are required
under applicable law to evidence the indebtedness represented by the Loan or to
perfect the lien of the Mortgage or Other Collateral.
8. Except as has been disclosed and agreed to by the Buyer in writing,
there is no agreement with the Borrower regarding any variation of the
interest rate and schedules of payment (except as described in the Note,
Mortgage and Other Collateral) or other terms and conditions of the Loan. No
Borrower has been released from liability on the Note, and no property has been
released from the Mortgage and Other Collateral. If the Loan is a variable rate
loan, the Seller represents and warrants as of each Settlement Date that all
applicable notices required by law or regulation have been provided to the
Borrower and that the right to future changes in the interest rate and payment
schedules has not been waved by the Seller or any previous holder of the Loan.
9. The Loan is secured by a mortgage on residential real estate or a
mixed-use or multi-family building, which does not include cooperative or
mobile homes attached to a foundation or otherwise and does not constitute other
than real property under state law.
10. The Loan is secured by a valid Mortgage, of the agreed-upon
priority, on real property, and by valid Other Collateral, of the agreed-upon
priority, on personal property, and such Other Collateral has been properly
received by the appropriate public recording official to be filed, recorded or
otherwise perfected in due course in accordance with applicable law in the
appropriate jurisdiction.
11. All of the improvements which were included for the purpose of
determining the appraised value of the real property securing the Loan lie
wholly within the boundaries and building restriction lines of such property,
and no improvements on adjoining properties encroach upon the property unless
any such improvements are stated in the title insurance policy and are
affirmatively insured.
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12. No improvement located on or being part of the real property
securing the Loan is in violation of any applicable zoning law or regulation.
All inspections, licenses and certificates required to be made or issued with
respect to all occupied portions of the property and, with respect to the use
and occupancy of the same, including but not limited to certificates of
occupancy and fire underwriting certificates, have been made or obtained from
the appropriate authorities and the property is lawfully occupied under
applicable law.
13. There are no violations of any applicable state or federal law or
regulation, including without limitation, the Fair Credit Reporting Act and
Regulations, the Federal Truth-in-Lending Act and Regulation Z, the Federal
Equal Credit Opportunity Act and Regulation B, the Federal Real Estate
Settlement Procedures Act and Regulation X, and any federal or state usury laws
and regulations.
14. Neither the sale nor assignment to the Buyer of the Loan will, by
reason thereof, in any way affect its enforceability.
15. The Seller holds a marked-up title policy or a title insurance
binder or title certificate which is in full force and effect, has an insurance
limit at least as great as the outstanding principal balance of the Loan, names
the Seller, its successors and assigns as the insured party, and is issued by a
title insurer approved by the Buyer in writing who is qualified to do business
in the jurisdiction where the Subject Property is located. Said policy shall:
(a) insure the absence of any lien for taxes and other assessments due
and unpaid as of the date of the policy;
(b) disclose whether all taxes and other assessments due as of the date
of the policy have been paid in full; and
(c) disclose all other matters to which like properties are commonly
subject.
If the Buyer purchases a Loan having relied on a marked-up title
insurance binder or title certificate rather than a title insurance policy, the
seller shall have thirty (30) days to deliver the title insurance policy to the
Buyer.
16. As of the Settlement Date the Seller has transferred to Buyer all
of its right, title and interest in the Note, Mortgage, Other Collateral and
Related Assets for the Loan free and clear of any pledge, liens, claims,
encumbrances, mortgages, charges, exceptions or security interest together with
an individual flood insurance policy (to the extent required by the Flood
Disaster Protection Act) and an individual current hazard insurance policy
(including fire and extended coverage and other matters as are customary in the
area of the Subject Property), or a blanket policy in lieu thereof, or a
certificate if the Buyer agrees in writing to accept a certificate, by a
company with an "A-" rating in Best's Guide (provided that applicable law
allows a lender to deny an insurance company based on the Rating System),
insuring the Subject Property, with a loss payable clause in favor of the
Seller, its successors and assigns in an amount equal to the lower of: (a) the
replacement value of the Subject Property, or (b) the unpaid principal balance
of the Loan and the senior mortgage(s) and security interests securing such
property or maximum allowable under state law.
17. The Note, Mortgage and Other Collateral contain customary, valid,
legal and enforceable provisions such as to render the rights and remedies of
the holder thereof adequate for the realization against the Subject Property of
the benefits of the security created thereby.
18. The proceeds of the Loan have been fully disbursed and any and all
requirements as to the completion of on-site improvements and the disbursement
of any escrow funds therefore have been complied with.
19. There are no mechanic's liens or similar liens or claims which have
been filed for work, labor or material affecting the Subject Property which are
or may be liens prior to or equal with the lien of the Mortgage and senior
Mortgage(s).
20. The Subject Property is free of material damage and waste and is in
good repair unless otherwise stated in the appraisal, and there is no
proceeding pending or threatened for the total or partial condemnation of the
Subject Property.
21. All matured obligations pursuant to the Note, Mortgage and Other
Collateral have been paid or performed and the Seller has not waived any
default, breach, violation or event of acceleration.
22. The Seller has no knowledge of any fact as to such Loan which it
has failed to disclose which would materially and adversely affect the
enforceability of the Loan.
23. The Seller has no knowledge of any impediments to title that
adversely affect the value, enjoyment or marketability of the Subject Property.
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24. Where required by state law, the Seller has filed a request
for notice of any action by a senior lienholder under a senior lien, and the
Seller has notified any superior lienholder in writing of the existence of the
Loan and requested notification of any action to be taken against the Borrower
by the superior lienholder with written requests for notification to the Buyer
of any action against the Borrower.
25. There is no default, breach, violation or event of
acceleration existing under any senior Mortgage or Other Collateral which, with
notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration.
26. Except where prohibited by law, each Note, Mortgage and
Other Collateral contain provisions for the acceleration of the payment of the
unpaid principal balance of the Loan in the event that the related Subject
Property is sold without the prior consent of the mortgagee or secured party
thereunder.
27. All real estate appraisals made in connection with each
Loan shall have been performed in accordance with the standards of the
appraising industry where the property is located. Any variances ascertained
pursuant to Article VI(G) of this Agreement greater than eight (8%) percent
shall constitute conclusive evidence of a breach of this warranty.
28. The Seller has not, in connection with the Loan, incurred
any obligation, made any commitment or taken any action which might result in a
claim against the Buyer or an obligation by the Buyer to pay a sales brokerage
commission, finder's fee or similar fee with respect to the transactions
between Buyer and Seller as described in this Agreement. The Seller agrees to
indemnify and hold the Buyer harmless from and against any claims, liabilities,
damages or costs (including reasonable attorney's fees) relating to any broker,
agent, finder or other person, who shall claim to have dealt on behalf of the
Seller in connection with the transactions contemplated by this Agreement.
29. Seller agrees to take no action to solicit Borrowers
individually in order to effect the refinancing of any Loan Buyer previously
purchased from Seller. In the event a Borrower elects to refinance with Seller
a Loan Buyer purchased from Seller, and such Loan is currently owned or
serviced by Buyer or Buyer otherwise retains a financial interest in the Loan,
Buyer will have the right of first refusal on the purchase of the refinancing.
For a period not to exceed two (2) years from the purchase date of a Loan,
Buyer will pay Seller the normal premium percentage on the refinanced Loan, but
only on the amount that the refinanced Loan balance exceeds that of the
original Loan Buyer purchased from Seller.
VI. BREACH OF REPRESENTATION AND WARRANTIES
(A) REMEDY FOR BREACH. In addition to any rights or remedies
the Buyer has at law or in equity, if at any time there is a breach of any
representation or warranty set forth herein by Seller, the Seller shall, upon
demand of the Buyer and at the sole option and absolute discretion of Buyer,
repurchase the affected Loan for the Buy-Back Price within thirty (30) days of
notification, or if the Loan has been sold by Buyer or the Subject Property has
been liquidated or sold by Buyer, the Seller shall, within thirty (30) days of
notification, pay the Buyer the amount of loss (as defined in Article VI(D),
below); but if the balance of the Reserve Account (if any) is greater than the
Required Reserve Balance (to be set by Separate Agreement), then Buyer shall
withdraw the amount of the loss from the Reserve Account. However, Buyer shall
never be required to withdraw the loss from the Reserve Account if such
withdrawal would reduce the Reserve Account less than the Required Reserve
Balance (to be set from time to time by separate agreement).
However, anything to the contrary notwithstanding, Buyer, prior
to seeking its remedies under this section, at its sole and absolute discretion
may grant Seller in writing a thirty-(30) day period in which to cure a breach
of any representation or warranty set forth in this Agreement. In the absence
of a written notice from Buyer to Seller to cure a breach of representation or
warranty, Buyer shall have the right to immediately pursue, demand, and seek
all remedies set forth in this Agreement, in addition to any rights or remedies
the Buyer has at law or in equity.
(B) REASSIGNMENTS. Upon receipt of the Buy-Back Price, in full,
in immediately available funds, the Buyer shall reassign the affected Loan and
any right it may have in the relevant Subject Property to the Seller, free and
clear of any lien, encumbrance, claim or interest of any person or entity
claiming by, through, or under the Buyer, without recourse, and shall execute
and deliver to the Seller in recordable or fileable form an assignment of the
Buyer's beneficial interest in the affected Mortgage and the Other Collateral,
as well as other documents necessary to reflect the reassignment of any title
protection or insurance policy. The Loan shall be reassigned by Buyer to Seller
without modification of the terms of the original Note.
(C) "BUY-BACK PRICE." The Term "Buy-Back Price" shall mean the
sum total of: (1) the outstanding principal balance of the Loan, with accrued
interest thereon through the date the Loan is repurchased by Seller; (2) all
advances made by Buyer and all charges due from the Borrower; (3) the total
amount, including accrued interest and other expenses paid by the Buyer to any
senior lienholders, if any, to secure a priority lien position; (4) all
reasonable and necessary expenses, losses and damages paid or incurred by the
Buyer in connection with an investigation of said Loan and/or related
collateral, including but not limited to, property taxes, maintenance costs,
interest expense, insurance appraisals, advertising, sales commissions,
reasonable attorney's fees, expenses, costs, fines and penalties; and (5) the
rebate of the premium due Buyer, if applicable.
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(D) DEFINITION OF "LOSS:" The term "Loss" shall mean the negative
result, if any, of the following calculations (1) the sum total of: (a) the
outstanding principal balance of the Loan, with accrued interest thereon
through the date the Loan is sold or the date the collateral is liquidated; (b)
all advances by Buyer and all charges due from the Borrower; (c) the total
amount paid by the Buyer to any senior lienholders, if any, to secure a first
lien position; (d) accrued interest on all Loans purchased from senior
lienholders from the date such Loans were purchased through the date the Loans
are sold or the date the collateral is liquidated; and (e) all other reasonable
and necessary expenses, losses and damages incurred and/or paid by the Buyer in
connection with the Loan or an investigation of said Loan or the sale or
liquidation of the Loan and/or the Related Collateral, including, but not
limited to, reasonable attorney's fees, expenses and costs, property taxes,
maintenance costs, interest expense, insurance, appraisals, advertising, sales
commissions, fines and penalties; (2) less the net proceeds from the sale of
the Loan or the sale or liquidation of the Subject Property or the Collateral.
(E) REMEDY FOR NON-DELIVERY OF DOCUMENTS. However, anything to the
contrary notwithstanding, in the event that the Seller is required to deliver
to the Buyer any documents related to a purchased Loan and the Seller fails to
deliver such document in the proper form on the date or within the time period
specified by the controlling section of this Agreement, Buyer shall notify the
Seller of the breach, and the Seller shall have thirty (30) days from the date
of notice to cure the breach. If the Seller has not cured the breach within the
thirty-(30) day cure period, the Seller shall immediately repurchase the Loan
upon Buyer's demand. The Buy-Back Price shall be determined in accordance with
Article VI(C). Any loan returned by the Buyer pursuant to this paragraph shall
be without recourse, representation or warranty.
(F) REMEDY FOR FIRST PAYMENT DEFAULT. However, anything to the contrary
notwithstanding, in the event the Borrower fails to make the first payment due
to the Buyer within thirty (30) days of the payment due date, regardless of
whether such payment is subsequently paid by the Borrower, the Buyer, at its
sole and absolute discretion, shall have the right to have Seller repurchase
said Loan(s) at the Buy-Back Price. The Seller shall have fifteen (15) days from
the date Buyer notifies Seller of a Borrower whose first payment is delinquent
to have Borrower cure such delinquency.
(G) REMEDY TO INSURE ACCURACY OF REAL ESTATE APPRAISALS. Buyer may, at
its own expense, in order to verify the accuracy of real property appraisals
prepared for Seller, order a reappraisal of the property secured by a
Mortgage. If the reappraisal obtained by Buyer indicates a fair market value of
more than eight (8%) percent less than the original appraisal value, then upon
receipt by Seller of a signed copy of the reappraisal from Buyer, Seller shall
repurchase the Loan at the Buy-Back Price (as defined in Article VI(C), above)
and reimburse Buyer for the cost of the appraisal subject the following: if
Seller disputes the validity of the reappraisal prepared by Buyer's appraiser,
Seller may at its own expense, request Buyer to obtain a third appraisal, and
only if such third appraisal is also more than eight (8%) percent less than the
original appraisal value shall the Seller be required to repurchase the Loan at
the Buy-Back Price. Buyer shall choose the review appraiser with Seller's
approval, which shall not be unreasonably withheld, but such appraiser must
possess the minimum qualifications specified in Buyer's Underwriting Guidelines.
The appraisal must be performed in accordance with the standards of the
appraising industry where the property is located, by an independent appraiser
unless otherwise agreed to by the parties. In determining the appropriate
appraisal value, the review appraiser must determine the appraised value as of
the original appraisal date using comparable sales that were available as of
the date of the original appraisal.
VII. INDEMNIFICATION
Seller hereby agrees to protect, indemnify, defend, and hold
harmless Buyer and its agents, employees, officers, and directors
(collectively, the "Buyer Indemnitee") from and against any and all
liabilities, costs, expenses, judgments, damages, losses, claims, demands,
offsets, defenses, counterclaims, actions, or proceedings, by whomsoever
asserted, arising from, connected with, or resulting from any breach by Seller
of any covenant, representation, or warranty contained herein or of any other
term of this Agreement or any act of Seller or omission of Seller where Seller
has a duty to act; provided, however, that Seller's obligation to indemnify
pursuant to this section shall not extend to any liability arising from
the gross negligence or willful misconduct of the Buyer Indemnitee.
It is understood by both parties that the Seller may use
brokers in soliciting or arranging Loans under this Agreement. The Seller shall
indemnify and hold the Buyer harmless of, from and against any and all loss,
liability, cost damage or expense, including reasonable attorney's fees and
disbursements, resulting from any such relationship between the Seller and any
broker. In the event that a Loan is originated by a lender other than the
Seller and subsequently purchased by the Seller and sold to the Buyer, all terms
and conditions of this Agreement shall still apply. In addition to all rights
that the Buyer may have against the Seller, in any such case, the Seller shall
obtain the representations and warranties set forth in Article V of this
Agreement from such originating lender and will assign all of its rights
against such lender to the Buyer in connection with the purchase of a Loan.
VIII. RELATIONSHIP OF THE PARTIES
It is agreed that the Seller and the Buyer are not partners or
joint venturers and that the Seller is not to act as an agent for the Buyer in
originating, administering or collecting any Loan, but shall have the status of
and shall act in all matters hereunder as an independent contractor.
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IX. APPOINTMENT OF ATTORNEY
Seller hereby irrevocably appoints Buyer and any officer or
employee of Buyer as its true and lawful attorney in fact to assign and/or
endorse to Buyer on behalf and/or in the name of Seller any document or
instrument created in connection with a Loan to which Buyer is entitled on the
Purchase of such Loan in accordance with this Agreement or under applicable
law, to prepare and execute in Seller's name assignments of the Mortgages and
the Other Collateral, to endorse, without recourse, any checks, drafts or other
instruments received as payment on any Loan and to do all other acts as may be
necessary or desirable in Buyer's determination to fully effectuate the sale
and transfer of title of any Loan sold by Seller to Buyer hereunder or to
effectuate the enforcement thereof or to perfect, pursue, effectuate, or enforce
any and all of Buyer's rights or interests therein or thereunder under this
Agreement. This power is coupled with an interest and is irrevocable and shall
survive the dissolution, consolidation, merger, reorganization or structural
change of Seller. Upon Buyer's demand, Seller will execute and deliver such
additional separate powers of attorney in Buyer's favor as Buyer, in its
discretion, shall determine to be necessary or advisable.
X. MISCELLANEOUS
(A) ADDITIONAL COVENANTS:
1. Each party shall, from time to time, execute and deliver, or
cause to be executed and delivered, such additional instruments, assignments,
endorsements, papers and documents as the other party may at any time
reasonably request for the purpose of carrying out this Agreement and the
transfers provided for herein.
2. The Seller shall, upon request of the Buyer, sign a letter,
in form to be approved by the Buyer and in conformity with the terms and
conditions hereof, addressed to all the Borrowers on the Loans, announcing the
sale evidenced hereby and instructing such Borrowers to recognize the Buyer as
the Seller's successor in interest to such Loans.
3. After any Settlement Date hereunder, the Seller will hold in
trust for the Buyer all sums received by the Seller from Borrower(s) on any
Loan purchased pursuant to this Agreement and pay them to the Buyer within
three (3) business days of the receipt of those sums.
4. Buyer's good faith decisions whether to take action relative
to a Loan, including, but not limited to, the sale or liquidation of a Loan,
Subject Property or Collateral, shall be final and conclusively binding upon
Seller in the event Seller does not repurchase a Loan within thirty (30) days
of notification by Buyer pursuant to Section VI of this Agreement.
5. The Seller shall promptly notify each obligor on a Loan of
the assignment and transfer of the Seller's interest in the Loan to the Buyer
and shall direct each obligor to make all payments thereon directly to the
Buyer or its designated Servicer unless otherwise notified. The Seller shall
promptly transmit any communication with respect to a Loan received by the
Seller following the purchase date.
(B) SURVIVAL OF COVENANTS, AGREEMENTS, REPRESENTATIONS AND
WARRANTIES: SUCCESSORS AND ASSIGNS. All warranties, representations and
covenants made by either party in this Agreement or in any other instrument
delivered by either party to the other, including those made by third parties
(for example, an appraiser, title company, closing agent, or credit agency) for
the benefit of either party, shall be considered to have been relied upon by
the other party (unless otherwise agreed to in writing by the parties) and
shall survive the termination of this Agreement. The Buyer reserves the right
to proceed against third parties to enforce any representations, warranties and
covenants made by them for the benefit of the Seller.
(C) SEVERABILITY. If any provision, or part thereof, of this
Agreement is invalid or unenforceable under any law, such provision, or part
thereof, is and will be totally ineffective to the extent, but the remaining
provisions, or parts thereof, will be unaffected.
(D) ATTORNEY'S FEES. However, anything to the contrary
notwithstanding, in the event of any action at law, in equity, arbitration or
otherwise between the parties in relation to this Agreement or any Loan or
other instrument or agreement required to be purchased ore sold hereunder, the
non-prevailing party, in addition to any other sums which such party shall be
required to pay pursuant to the terms and conditions of this Agreement, at law,
in equity, arbitration or otherwise shall also be required to pay to the
prevailing party all costs and expenses of such litigation, including
reasonable attorney's fees.
(E) WAIVERS. No waiver of any term, provision or condition of
this Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any
such term, provision or condition, or of any other term, provision or condition
of this Agreement.
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(F) NOTICE. Any notice or other communication in this Agreement
provided or permitted between the parties must be in writing, delivered
personally or by certified mail, return receipt requested, to the party to be
notified. For notification purposes, the addresses of the parties shall be as
follows:
SELLER:
ATTENTION:
BUYER: CITYSCAPE CORP.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTENTION: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, President
The above addresses may be changed from time to time upon written notice
from one party to the other.
(G) INSURANCE PREPAYMENT. Any insurance refund or credits of any kind
shall be the sole responsibility of the Seller in the event of the prepayment
of any Loan, cancellation of insurance or any other event requiring the
refunding or crediting of unearned insurance premiums. Upon the Buyer's demand,
Seller shall pay Buyer, from Seller's own funds, any required insurance premium
rebate resulting from the prepayment, cancellation, refinancing or other
termination of any Loan. Upon such payment, Buyer shall assign in writing any
rights it had to require that the insurer reimburse Buyer for any rebate made
to Borrower.
(H) ASSIGNMENT. The Seller shall not, without the prior written consent
of the Buyer, assign any of its rights or obligations hereunder.
(I) CAPTIONS. Paragraph or other headings contained in this Agreement
are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement in any way.
(J) ENTIRE AGREEMENT. The Agreement and the Exhibits attached hereto,
and the documents referred to herein or executed concurrently herewith regard
to the subject matter hereof, and there are no prior agreements,
understandings, restrictions, warranties or representations between the parties
with respect thereto.
(K) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York. The provisions of this
paragraph shall not affect the provisions of any Note, Mortgage or Related
Assets which cause the laws of the United states or any other state to be
applicable. This Agreement shall be interpreted fairly in accordance with its
provisions and without regard to which party drafted it.
(L) TERMINATION.
1. This Agreement is terminable by either party upon ninety (90) days'
written notice of termination to the non-terminating party. Upon such
termination, Buyer must honor any outstanding commitments or Approval Advices
issued to seller and purchase all Loans subject to such commitment or Approval
Advice. Notwithstanding the foregoing, Buyer has the option of terminating this
Agreement immediately upon notice to the Seller upon the Seller's breach of any
of the Representations and Warranties contained in Article V of this Agreement,
and Buyer shall have no obligation to honor any commitment or Approval Advice
after such termination.
2. In addition to the right of the parties to terminate this Agreement
pursuant to section X(L)(1), above, any agreement of the Buyer to purchase
Loans pursuant to this Agreement shall automatically terminate if prior to such
purchase: (a) a decree or order of a court or agency supervisory authority
having jurisdiction for the appointment of a conservator, receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities, bankruptcy or similar proceeding, or for the winding up or
liquidation of its affairs, shall have been entered against the Seller or
Borrower and such decree or order shall have remained in force undischarged or
unstated for a period of 60 days; or (b) the Seller or Borrower shall consent
to the appointment of a conservator, receiver, or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities, bankruptcy or
similar proceeding relating to the seller or relating to all or substantially
all of its property; or (c) the Seller or Borrower shall admit in writing its
inability to pay its debts as they become due, file a petition to take
advantage of any applicable insolvency, reorganization or bankruptcy statute,
make an assignment for the benefit of its creditors, or voluntarily suspend
payment of its obligations.
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3. All representations, warranties, covenants and other
obligations of Seller shall survive termination of this Agreement and shall
continue in full force and effect in spite of any such termination.
(M) ARBITRATION, JURISDICTION AND VENUE. For emergency relief,
injunctive or otherwise, the parties hereby consent to the exclusive
jurisdiction of the Supreme Court, State of New York or the Federal District
Court of the Eastern District of New York and waive personal service of any and
all process upon them and consent that all such service of process be made by
registered or certified mail directed to them at the address stated herein and
service so made shall be deemed to be completed five (5) days after mailing. The
parties waive trial by jury and waive any objection to, and agree not to assert
any defense based on the lack of, jurisdiction and venue, and consent to the
granting of such legal or equitable relief as is deemed appropriate by the
court.
Except with respect to any such emergency relief, at the sole
and exclusive option and discretion of Buyer, any other controversy or claim
arising out of or relating to this Agreement, or any breach thereof, shall be
settled in White Plains, New York in accordance with the Rules of the American
Arbitration Association (as modified below), and judgment upon the award may be
entered in any court having jurisdiction thereof.
The arbitration panel shall be made up of three members, one of
which shall be appointed by Buyer, one by Seller, and one by the other two
arbitrators. Each arbitrator shall be an attorney experienced in matters
relating to real estate and mortgage banking. Discovery shall be permitted in
connection with the arbitration proceeding within the reasonable discretion of
the arbitration panel. The decision (award) shall be in writing and shall set
forth the rationale and legal basis therefor and such decision may be appealed
by either party if it believes that the written decision (award) is based upon
an error of law. The facts as determined by the original panel will be final
and no appeal of such findings may be made. Such appeal shall be taken to a
three-member arbitration panel, the members of which shall be selected in
accordance with the above-described procedures and the panel's review shall be
limited to the application of the statutory and decisional law of the State of
New York (as modified by Article X(K) above) to the facts of the dispute as
determined in writing by the original arbitration panel.
(N) ENDORSEMENTS. In the event that the remedies or other
terms outlined in this Agreement conflict with the terms of any endorsement by
the Seller of any Note evidencing a Loan purchased by the Buyer from the
Seller, including, but not limited to, an endorsement stating that the
assignment of the Note is without recourse, the remedies and terms of this
Agreement shall govern and control. Each party to this Agreement shall pay its
own expenses incurred in connection with the preparation, execution and
delivery of this Agreement and the transactions herein contemplated, including
but not limited to, the fees and disbursements of counsel; provided, however,
that the Seller shall pay any transfer or other taxes and recording or filing
fees payable in connection with the sale and purchase of Loans.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written:
SELLER:____________________________
By:________________________________ By:__________________________________
Name:______________________________ Name:________________________________
Title:_____________________________ Title:_______________________________
(affix Corporate Seal)
BUYER: CITYSCAPE CORP.
By:________________________________
Name:______________________________
Title:_____________________________
(Affix Corporate Seal)
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EXHIBIT A
COMMITMENT TO PURCHASE
SELLER: ______________________________________________________________
DATE: ______________________________________________________________
LOAN
APPLICANT(S): ______________________________________________________________
ACCOUNT #: _____________________ GRADE: ______________________
LOAN AMOUNT: _____________________ NOTE RATE: ______________________
BUY RATE: _____________________ PREMIUM: ______________________
TERM: _____________________ EXPIRATION
DATE: ______________________
POSITION: _____________________
PURPOSE: ______________________________________________________________
Cityscape (Buyer) commits to purchase the above referenced loan from Seller
provided that Buyer receives a copy of this Commitment duly signed by Seller
within ___ days following the above Date, provided that the loan is delivered
to Buyer for purchase in full compliance with the terms of this Commitment on
or before the above Expiration Date, and contingent on the following
stipulations:
1. Closing and disbursement are to be conducted only by Cityscape approved
attorneys and/or closing agents.
2. _______________________________________________________________________
3. _______________________________________________________________________
4. _______________________________________________________________________
5. _______________________________________________________________________
6. _______________________________________________________________________
7. _______________________________________________________________________
8. _______________________________________________________________________
9. _______________________________________________________________________
10. _______________________________________________________________________
Except as otherwise set forth in this Commitment, the purchase of the loan is
governed in all respects by the Master Agreement For Purchase And Sale of
Mortgage Loans currently in effect between Seller and Buyer, the terms of which
are incorporated herein and made a part hereof.
ACCEPTED AND AGREED TO:
BUYER: CITYSCAPE CORP. SELLER: ______________________
BY: _____________________ BY: ______________________
TITLE: _____________________ TITLE: ______________________
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EXHIBIT B
Pay to the order of
Cityscape Corp.
Without Recourse
"Seller"
By: _____________________________
Officer
In the states of California, Colorado, Illinois, Indiana, Minnesota, New
Jersey, and Oregon the endorsement must be to Cityscape Mortgage Corp.
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