EXHIBIT 99.1
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▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE CAPITAL INC.,
SELLER
and
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS, INC.,
PURCHASER
MORTGAGE LOAN SALE AND ASSIGNMENT AGREEMENT
Dated as of October 1, 2004
▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors Trust
(Mortgage Loan Asset-Backed Certificates, Series 2004-HE2)
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This MORTGAGE LOAN SALE AND ASSIGNMENT AGREEMENT, dated as of October 1,
2004 (the "Agreement"), is executed by and between ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage
Capital Inc. (the "Seller") and ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Investors, Inc. (the
"Depositor").
All capitalized terms not defined herein shall have the same meanings
assigned to such terms in that certain Pooling and Servicing Agreement (the
"Pooling Agreement"), dated as of October 1, 2004, among the Depositor, ▇▇▇▇▇
Fargo Bank, National Association, as trustee (the "Trustee") and Wilshire Credit
Corporation, as servicer (the "Servicer").
W I T N E S S E T H:
WHEREAS, pursuant to certain master mortgage loan purchase and interim
servicing agreements listed on Exhibit A hereto (collectively, the "Transfer
Agreements") between the Seller and each of the originators listed on Exhibit B
hereto (collectively, the "Transferors"), Seller has purchased or received
certain mortgage loans identified on the Mortgage Loan Schedule attached hereto
as Schedule A (the "Mortgage Loans");
WHEREAS, each Transfer Agreement is supplemented by a related letter
agreement, each dated as of October 21, 2004 among the related Transferor and
the Seller (each, a "Bring Down Letter");
WHEREAS, the Seller desires to sell, without recourse, all of its rights,
title and interest in the Mortgage Loans to the Depositor, to assign all of its
rights and interest under the Transfer Agreements and the Bring Down Letters,
and to delegate all of its obligations thereunder, to the Depositor; and
WHEREAS, the Seller and the Depositor acknowledge and agree that the
Depositor will assign all of its rights and delegate all of its obligations
hereunder to the Trustee, and that each reference herein to the Depositor is
intended, unless otherwise specified, to mean the Depositor or the Trustee, as
assignee, whichever is the owner of the Mortgage Loans from time to time.
NOW, THEREFORE, in consideration of the mutual agreements herein set
forth, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the Seller and the Depositor agree as follows:
ARTICLE I
CONVEYANCE OF MORTGAGE LOANS
Section 1.01. Sale of Mortgage Loans. Concurrently with the execution and
delivery of this Agreement, the Seller does hereby transfer, assign, set over,
deposit with and otherwise convey to the Depositor, without recourse, subject to
Sections 1.03 and 1.04, all the right, title and interest of the Seller in and
to the Mortgage Loans identified on Schedule A hereto, having an aggregate
principal balance as of the Cut-off Date of approximately $511,034,204.29. Such
conveyance includes, without limitation, the right to all distributions of
principal and interest received on or with respect to the Mortgage Loans on or
after October 1, 2004, other than payments of principal and interest due on or
before such date, and all such payments due after such date but received prior
to such date and intended by the related Mortgagors to be applied after such
date, together with all of the Seller's right, title and interest in and to each
related account and all amounts from time to time credited to and the proceeds
of such account, any REO Property and the proceeds thereof, the Seller's rights
under any Insurance Policies related to the Mortgage
Loans, and the Seller's security interest in any collateral pledged to secure
the Mortgage Loans, including the Mortgaged Properties.
Concurrently with the execution and delivery of this Agreement, the Seller
hereby assigns to the Depositor all of its rights and interest under the
Transfer Agreements and the Bring Down Letters, other than any servicing rights
retained pursuant to the provisions of the Transfer Agreements and the Bring
Down Letters, to the extent relating to the Mortgage Loans. Concurrently with
the execution hereof, the Depositor tenders the purchase price of
$511,034,204.29. The Depositor hereby accepts such assignment, and shall be
entitled to exercise all such rights of the Seller under the Transfer Agreements
and the Bring Down Letters, as if the Depositor had been a party to such
agreement.
Section 1.02. Delivery of Documents. In connection with such transfer and
assignment of the Mortgage Loans hereunder, the Seller does hereby deliver, or
cause to be delivered, to the Depositor (or its designee) the documents or
instruments with respect to each Mortgage Loan (each a "Mortgage File") so
transferred and assigned, as specified in the Transfer Agreements.
(a) For Mortgage Loans (if any) that have been prepaid in full after the
Cut-off Date and prior to the Closing Date, the Seller, in lieu of delivering
the related Mortgage Files, herewith delivers to the Depositor an Officer's
Certificate which shall include a statement to the effect that all amounts
received in connection with such prepayment that are required to be deposited in
the account maintained by the Servicer for such purpose have been so deposited.
Section 1.03. Review of Documentation. The Depositor, by execution and
delivery hereof, acknowledges receipt of the Mortgage Files pertaining to the
Mortgage Loans listed on the Mortgage Loan Schedule, subject to review thereof
by the trustee, ▇▇▇▇▇ Fargo Bank, N.A. (the "Trustee") for the Mortgage Loans
for the Depositor. The Trustee is required to review, within 45 days following
the Closing Date, each applicable Mortgage File. If in the course of such review
the Trustee identifies any material defect, the Seller shall be obligated to
cure such defect or to repurchase the related Mortgage Loan from the Depositor
(or, at the direction of and on behalf of the Depositor, from the Trust Fund),
or to substitute a Replacement Mortgage Loan therefor, in each case to the same
extent and in the same manner as the Depositor is obligated to the Trustee and
the Trust Fund under the Pooling Agreement.
Section 1.04. Representations and Warranties of the Seller.
(a) The Seller hereby represents and warrants to the Depositor that as of
the date hereof that:
(i) The Seller is a Delaware corporation duly organized, validly
existing and in good standing under the laws governing its creation and
existence and has full corporate power and authority to own its property,
to carry on its business as presently conducted and to enter into and
perform its obligations under this Agreement;
(ii) The execution and delivery by the Seller of this Agreement have
been duly authorized by all necessary corporate action on the part of the
Seller; none of the execution and delivery of this Agreement, the
consummation of the transactions herein contemplated or compliance with
the provisions hereof will conflict with or result in a breach of, or
constitute a default under, any of the provisions of any law, governmental
rule, regulation, judgment, decree or order binding on the Seller or its
properties or the federal stock charter or bylaws of the Seller;
(iii) The execution, delivery and performance by the Seller of this
Agreement and the consummation of the transactions contemplated hereby do
not require the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any
state, federal or other governmental authority or agency, except such as
has been obtained, given, effected or taken prior to the date hereof;
(iv) This Agreement has been duly executed and delivered by the
Seller and, assuming due authorization, execution and delivery by the
Depositor, constitutes a valid and binding obligation of the Seller
enforceable against it in accordance with its terms except as such
enforceability may be subject to (A) applicable bankruptcy and insolvency
laws and other similar laws affecting the enforcement of the rights of
creditors generally and (B) general principles of equity regardless of
whether such enforcement is considered in a proceeding in equity or at
law; and
(v) There are no actions, suits or proceedings pending or, to the
knowledge of the Seller, threatened or likely to be asserted against or
affecting the Seller, before or by any court, administrative agency,
arbitrator or governmental body (A) with respect to any of the
transactions contemplated by this Agreement or (B) with respect to any
other matter which in the judgment of the Seller will be determined
adversely to the Seller and will if determined adversely to the Seller
materially and adversely affect it or its business, assets, operations or
condition, financial or otherwise, or adversely affect its ability to
perform its obligations under this Agreement.
(b) The representations and warranties of each Transferor with respect to
the Mortgage Loans contained in the applicable Transfer Agreement were made as
of the date of such Transfer Agreement and brought forward to the Closing Date
pursuant to the applicable Bring Down Letter. The representations and warranties
of each Transferor with respect to the Mortgage Loans contained in the
applicable Bring Down Letter are being made as of the Closing Date. To the
extent that any fact, condition or event with respect to a Mortgage Loan
constitutes a breach of both (i) a representation or warranty of a Transferor
under the applicable Transfer Agreement or Bring Down Letter and (ii) a
representation or warranty of the Seller under this Agreement, the sole right or
remedy of the Depositor with respect to a breach by the Seller of such
representation and warranty (other than a breach by the Seller of the
representations and warranties made pursuant to Sections 1.04(b)(ix) and
1.04(b)(x)) shall be the right to enforce the obligations of the applicable
Transferor under any applicable representation or warranty made by it; provided,
however, that to the extent First NLC Financial Services, LLC ("First NLC")
fails to fulfill its contractual obligations under the applicable Transfer
Agreement then the Depositor shall have the right to enforce such obligations of
First NLC against the Seller. The representations made by the Seller pursuant to
Sections 1.04(b)(ix) and 1.04(b)(x) shall be direct obligations of the Seller.
The Depositor acknowledges and agrees that the representations and warranties of
the Seller in this Section 1.04(b) (other than the representations and
warranties made pursuant to Sections 1.04(b)(ix) and 1.04(b)(x)) are applicable
only to facts, conditions or events that do not constitute a breach of any
representation or warranty made by a Transferor in the applicable Transfer
Agreement or Bring Down Letter. Except with respect to First NLC, the Seller
shall have no obligation or liability with respect to any breach of a
representation or warranty made by it with respect to the Mortgage Loans if the
fact, condition or event constituting such breach also constitutes a breach of a
representation or warranty made by a Transferor in the applicable Transfer
Agreement or Bring Down Letter, without regard to whether such Transferor
fulfills its contractual obligations in respect of such representation or
warranty; provided, however, that if such Transferor fulfills its obligations
under the provisions of the applicable Transfer Agreement and the Bring Down
Letter by substituting for the affected Mortgage Loan a mortgage loan which is
not a Replacement Mortgage Loan, the Seller shall, in exchange for such
substitute mortgage loan, provide the Depositor (a) with the applicable Purchase
Price for the affected Mortgage Loan or (b) within the two year period following
the Closing Date, with a Qualified Substitute Mortgage Loan for such affected
Mortgage Loan. Subject to the foregoing, the Seller represents and warrants upon
delivery of the Mortgage Loans to the Depositor hereunder, as to each, that as
of October 21, 2004:
(i) The information set forth with respect to the Mortgage Loans on
the Mortgage Loan Schedule provides an accurate listing of the Mortgage
Loans, and the information with respect to each Mortgage Loan on the
Mortgage Loan Schedule is true and correct in all material respects at the
date or dates respecting which such information is given;
(ii) As of the Closing Date, no Mortgage Loan is in foreclosure;
(iii) As of the Closing Date, each Mortgage Loan is a "qualified
mortgage" within the meaning of Section 860G of the Code (as determined
without regard to Treas. Reg. Section 1.860G-2(a)(3) or any similar rule
that treats a defective obligation as a qualified mortgage for a temporary
period);
(iv) The representations and warranties contained in Subsection 7.02
(4), (5), (7), (9), (19) and (25), (26), (28) and (36) of the Transfer
Agreement between The CIT Group/Consumer Finance, Inc. and ▇▇▇▇▇▇▇ ▇▇▇▇▇
Mortgage Capital Inc. ("MLMC"), dated as of January 1, 2004, are hereby
restated by the Seller as of the Closing Date;
(v) The representations and warranties contained in Subsection 7.02
(4), (5), (7), (9), (19), (25), (26), (34) and (36) of the Transfer
Agreement between Fremont Investment & Loan and MLMC, dated as of December
1, 2003, are hereby restated by the Seller as of the Closing Date;
(vi) The representations and warranties contained in Subsection 7.02
of the Transfer Agreement between First NLC and MLMC, dated as of March 1,
2004, are incorporated herein by reference as of the Closing Date;
(vii) As of the Closing Date, no Mortgage Loan provides for interest
other than at either (i) a single fixed rate in effect throughout the term
of the Mortgage Loan or (ii) a "variable rate" (within the meaning of
Treas. Reg. Section 1.860G-1(a)(3)) in effect throughout the term of the
Mortgage Loan;
(viii) As of the Closing Date, the Seller would not, based on the
delinquency status of the Mortgage Loans, institute foreclosure
proceedings with respect to any of the Mortgage Loans prior to the next
scheduled payment for such Mortgage Loan;
(ix) None of the Mortgage Loans are "high cost" as defined by
applicable predatory and abusive lending laws; No Mortgage Loan is a High
Cost Loan or Covered Loan, as applicable (as such terms are defined in the
current Standard & Poor's LEVELS(R) Glossary which is now Version 5.6
Revised, Appendix E) and no mortgage loan originated on or after October
1, 2002 through March 6, 2003 is governed by the Georgia Fair Lending Act;
and
(x) Each Mortgage Loan at the time it was made complied with all
applicable local, state and federal lending laws, including, but not
limited to, all applicable predatory and abusive lending laws.
(c) It is understood and agreed that the representations and warranties
set forth in Section 1.04(b) herein shall survive delivery of the Mortgage Files
and the Assignment of Mortgage of each Mortgage Loan to the Depositor. Upon
discovery by either the Seller or the Depositor of a breach of any of the
foregoing representations and warranties that adversely and materially affects
the value of the related Mortgage Loan, and that does not also constitute a
breach of a representation or warranty of a Transferor in the applicable
Transfer Agreement or Bring Down Letter, the party discovering such breach
shall give prompt written notice to the other party. Within 60 days of the
discovery of any such breach, the Seller shall either (a) cure such breach in
all material respects, (b) repurchase such Mortgage Loan or any property
acquired in respect thereof from the Depositor at the applicable Purchase Price
or (c) within the two year period following the Closing Date, substitute a
Replacement Mortgage Loan for the affected Mortgage Loan. The Seller indemnifies
and holds the Trust Fund, the Trustee, the Depositor, the Servicer, the NIMs
Insurer and each Certificateholder harmless against any and all taxes, claims,
losses, penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and any other costs, fees and expenses that the Trust Fund, the
Trustee, the Depositor, the Servicer, the NIMs Insurer and any Certificateholder
may sustain in connection with any actions of the Seller relating to a
repurchase of a Mortgage Loan other than in compliance with the terms of this
Section 2.03 of the Pooling Agreement and this Agreement, to the extent that any
such action causes (i) any federal or state tax to be imposed on the Trust Fund
or any REMIC provided for in the Pooling Agreement, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(1) of the Code or on "contributions after the startup date" under
Section 860(d)(1) of the Code, or (ii) any REMIC created in the Pooling
Agreement to fail to qualify as a REMIC at any time that any Certificate is
outstanding.
Section 1.05. Grant Clause. It is intended that the conveyance of the
Seller's right, title and interest in and to Mortgage Loans and other property
conveyed pursuant to this Agreement shall constitute, and shall be construed as,
a sale of such property and not a grant of a security interest to secure a loan.
However, if such conveyance is deemed to be in respect of a loan, it is intended
that: (1) the rights and obligations of the parties shall be established
pursuant to the terms of this Agreement; (2) the Seller hereby grants to the
Depositor a first priority security interest in all of the Seller's right, title
and interest in, to and under, whether now owned or hereafter acquired, such
Mortgage Loans and other property; and (3) this Agreement shall constitute a
security agreement under applicable law.
Section 1.06. Assignment by Depositor. The Depositor shall have the right,
upon notice to but without the consent of the Seller, to assign, in whole or in
part, its interest under this Agreement with respect to the Mortgage Loans to
the Trustee, and the Trustee then shall succeed to all rights of the Depositor
under this Agreement. All references to the Depositor in this Agreement shall be
deemed to include its assignee or designee, specifically including the Trustee.
ARTICLE II
MISCELLANEOUS PROVISIONS
Section 2.01. Binding Nature of Agreement; Assignment. This Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
Section 2.02. Entire Agreement. This Agreement contains the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or written,
of any nature whatsoever with respect to the subject matter hereof. The express
terms hereof control and supersede any course of performance and/or usage of the
trade inconsistent with any of the terms hereof.
Section 2.03. Amendment. This Agreement may be amended from time to time
by the Seller and the Depositor, without notice to or the consent of any of the
Holders, (i) to cure any ambiguity or correct any mistake, (ii) to cause the
provisions herein to conform to or be consistent with or in furtherance of the
statements made with respect to the Certificates, the Trust Fund, the Pooling
Agreement or this Agreement in any Offering Document; or to correct or
supplement any provision herein which may be inconsistent with any other
provisions herein, (iii) to make any other provisions with respect to matters or
questions arising under this Agreement or (iv) to modify, alter, amend, add to
or rescind any of the terms or provisions to the extent necessary or desirable
to comply with any requirements imposed by the Code and the REMIC Provisions. No
such amendment effected pursuant to clause (iii) of the preceding sentence shall
adversely affect in any material respect the interests of any Holder. Any such
amendment shall be deemed not to adversely affect in any material respect any
Holder, if the Trustee receives written confirmation from each Rating Agency
that such amendment will not cause such Rating Agency to reduce the then current
rating assigned to the Certificates (and any Opinion of Counsel requested by the
Trustee in connection with any such amendment may rely expressly on such
confirmation as the basis therefor).
(a) This Agreement may also be amended from time to time by the Seller and
the Depositor with the consent of the Holders of not less than 66-2/3% of the
Class Certificate Principal Amount (or Percentage Interest) of each Class of
Certificates affected thereby for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders; provided, however, that no
such amendment may (i) reduce in any manner the amount of, or delay the timing
of, payments received on Mortgage Loans which are required to be distributed on
any Certificate without the consent of the Holder of such Certificate or (ii)
reduce the aforesaid percentages of Class Principal Amount (or Percentage
Interest) of Certificates of each Class, the Holders of which are required to
consent to any such amendment without the consent of the Holders of 100% of the
Class Principal Amount (or Percentage Interest) of each Class of Certificates
affected thereby. For purposes of this paragraph, references to "Holder" or
"Holders" shall be deemed to include, in the case of any Class of Book-Entry
Certificates, the related Certificate Owners.
(b) It shall not be necessary for the consent of Holders under this
Section 2.03 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Holders shall be subject to such reasonable regulations as
the Trustee may prescribe.
Section 2.04. 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 WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK.
Section 2.05. 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 2.06. Indulgences; No Waivers. Neither the failure nor any delay
on the part of a party to exercise any right, remedy, power or privilege under
this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any other or
further exercise of the same or of any other right, remedy, power or privilege,
nor shall any waiver of any right, remedy, power or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such
waiver.
Section 2.07. Headings Not to Affect Interpretation. The headings
contained in this Agreement are for convenience of reference only, and they
shall not be used in the interpretation hereof.
Section 2.08. Benefits of Agreement. Nothing in this Agreement, express or
implied, shall give to any Person, other than the parties to this Agreement and
their successors hereunder, any benefit or any legal or equitable right, power,
remedy or claim under this Agreement.
Section 2.09. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, and all of which
together shall constitute one and the same instrument.
[SIGNATURE PAGE IMMEDIATELY FOLLOWS]
IN WITNESS WHEREOF, the Seller and the Depositor have caused their names
to be signed hereto by their respective duly authorized officers as of the date
first above written.
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE CAPITAL INC.
By:________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
Title: Vice President
▇▇▇▇▇▇▇ ▇▇▇▇▇ MORTGAGE INVESTORS,
INC.
By:________________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
EXHIBIT A
TRANSFER AGREEMENTS
1. Master Mortgage Loan Purchase and Interim Servicing Agreement, dated as of
January 1, 2004, among ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Capital Inc., as Purchaser
and The CIT Group/Consumer Finance, Inc., The CIT Group/Consumer Finance,
Inc. (NY) and The CIT Group/Consumer Finance, Inc. (TN), as Seller, as
amended.
2. Master Mortgage Loan Purchase and Interim Servicing Agreement, dated as of
March 1, 2004, between ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Capital Inc., as Purchaser
and Fieldstone Mortgage Company, as Seller, as amended.
3. Master Mortgage Loan Purchase and Interim Servicing Agreement, dated as of
March 1, 2004, between ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Capital Inc., as Purchaser
and First NLC Financial Services, LLC, as Seller, as amended.
4. Master Mortgage Loan Purchase and Interim Servicing Agreement, dated as of
December 1, 2003, between ▇▇▇▇▇▇▇ ▇▇▇▇▇ Mortgage Capital Inc., as
Purchaser and Fremont Investment & Loan, as Seller, as amended.
EXHIBIT B
TRANSFERORS
1. The CIT Group/Consumer Finance, Inc.
2. Fieldstone Mortgage Company
3. First NLC Financial Services, LLC
4. Fremont Investment & Loan
SCHEDULE A
MORTGAGE LOAN SCHEDULE
[INTENTIONALLY OMITTED]
