Exhibit 99.3
EXECUTION COPY
MORGAN STANLEY CAPITAL I INC.
as Purchaser
and
MORGAN STANLEY MORTGAGE CAPITAL INC.
as Seller
MORTGAGE LOAN PURCHASE AGREEMENT
Dated as of September 1, 2006
Adjustable-Rate and Hybrid Adjustable-Rate Mortgage Loans
Morgan Stanley Mortgage Loan Trust 2006-13ARX,
Mortgage Pass-Through Certificates, Series 2006-13ARX
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Table of Contents
Page
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ARTICLE I.
DEFINITIONS
Section 1.01.
Definitions........................................1
ARTICLE II. SALE OF
MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01. Sale and
Assignment of Mortgage Loans..............2
Section 2.02. Recognition of
Trustee.............................2
Section 2.03. Obligations of
Seller Upon Sale....................2
Section 2.04. Payment of
Purchase Price for the Mortgage Loans...4
ARTICLE III.
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01. Seller
Representations and Warranties Relating
to the Mortgage Loans..............................4
Section 3.02. Seller
Representations and Warranties.............11
ARTICLE IV. SELLER'S
COVENANTS
Section 4.01. Covenants of the
Seller...........................12
ARTICLE V.
INDEMNIFICATION WITH RESPECT TO THE SELLER INFORMATION
Section 5.01.
Indemnification...................................13
ARTICLE VI.
TERMINATION
Section 6.01.
Termination.......................................16
ARTICLE VII.
MISCELLANEOUS PROVISIONS
Section 7.01.
Amendment.........................................16
Section 7.02. Governing
Law.....................................16
Section 7.03.
Notices...........................................16
Section 7.04. Severability of
Provisions........................17
Section 7.05.
Counterparts......................................17
Section 7.06. Further
Agreements................................17
Section 7.07. Intention of the
Parties..........................17
Section 7.08. Successors and
Assigns: Assignment of Purchase
Agreement.........................................17
Section 7.09.
Survival..........................................18
Schedule I - Mortgage Loan Schedule I-1
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EXECUTION COPY
MORTGAGE LOAN PURCHASE AGREEMENT, dated as of September 1, 2006
(the
"Agreement"), between MORGAN STANLEY MORTGAGE CAPITAL INC. (the
"Seller" or
"MSMCI") and MORGAN STANLEY CAPITAL I INC. (the "Purchaser").
WITNESSETH:
WHEREAS, the Seller is the owner of either the notes or other
evidence of indebtedness (the "Mortgage Notes") or other evidence
of ownership
so indicated on Schedule I hereto referred to below, and the other
documents or
instruments constituting the Mortgage File (collectively, the
"Mortgage Loans");
and
WHEREAS, the Seller, as of the date hereof, owns the mortgages
(the
"Mortgages") on the properties (the "Mortgaged Properties")
securing such
Mortgage Loans, including rights to (a) any property acquired by
foreclosure or
deed in lieu of foreclosure or otherwise and (b) the proceeds of
any insurance
policies covering the Mortgage Loans or the Mortgaged Properties or
the obligors
on the Mortgage Loans; and
WHEREAS, the parties hereto desire that the Seller sell the
Mortgage
Loans to the Purchaser and the Purchaser purchase the Mortgage
Loans from the
Seller pursuant to the terms of this Agreement; and
WHEREAS, pursuant to the terms of a Pooling and Servicing
Agreement
dated as of September 1, 2006 (the "Pooling and Servicing
Agreement") among the
Purchaser, as depositor, Wells Fargo Bank, National Association, as
master
servicer and securities administrator, and LaSalle Bank National
Association, as
trustee (the "Trustee"), the Purchaser will convey the Mortgage
Loans to Morgan
Stanley Mortgage Loan Trust 2006-13ARX (the "Trust").
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
Section
1.01. Definitions. All capitalized terms used but not defined
herein and below shall have the meanings assigned thereto in the
Pooling and
Servicing Agreement.
"Seller Information": The information set forth in the
Prospectus
Supplement or the Free Writing Prospectus under the caption:
"Description of the
Mortgage Loans--Loan Purchasing Guidelines and Underwriting
Standards", "--Loan
Purchasing Guidelines--Morgan Stanley Mortgage Capital Inc."
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ARTICLE II.
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section
2.01. Sale and Assignment of Mortgage Loans.
(a) On and of the date hereof, MSMCI hereby sells, assigns and
transfers to the Depositor all of its right, title and interest in
the Mortgage
Loans and all rights and obligations related thereto as provided
under the
Agreement to the extent relating to the Mortgage Loans, the
Depositor hereby
accepts such assignment from MSMCI (the "First Assignment and
Assumption"), and
the Seller hereby acknowledges the First Assignment and
Assumption.
(b) On and of the date hereof, immediately after giving effect
to
the First Assignment and Assumption, the Depositor hereby sells,
assigns and
transfers to the Trustee, on behalf of the Trust, all of its right,
title and
interest in the Mortgage Loans and all rights and obligations
related thereto,
and the Trustee, on behalf of the Trust, hereby accepts such
assignment from the
Depositor (the "Second Assignment and Assumption"), and the Seller
hereby
acknowledges the Second Assignment and Assumption.
(c) On and as of the date hereof, MSMCI represents and warrants
to
the Depositor and the Trustee that MSMCI has not taken any action
that would
serve to impair or encumber the respective ownership interests of
the Depositor
and the Trustee in the Mortgage Loans since the date of MSMCI's
acquisition of
the Mortgage Loans.
Section
2.02. Recognition of Trustee
(a) From and after the date hereof, both MSMCI and the
Depositor
shall note the transfer of the Mortgage Loans to the Trustee, in
their
respective books and records and shall recognize the Trustee, on
behalf of the
Trust, as of the date hereof, as the owner of the Mortgage Loans,
and Servicer
shall service the Mortgage Loans for the benefit of the Trust
pursuant to the
Agreement, the terms of which are incorporated herein by reference.
It is the
intention of the Servicer, the Depositor, the Trustee and MSMCI
that this
Assignment shall be binding upon and inure to the benefit of the
Depositor, the
Trustee and MSMCI and their respective successors and assigns.
(b) Without in any way limiting the foregoing, the parties
confirm
that this Assignment includes the rights relating to amendments or
waivers under
the Agreement. Accordingly, the right of MSMCI to consent to any
amendment of
the Agreement and its rights concerning waivers as set forth in
Section 12.02 of
the Agreement shall be exercisable, to the extent any such
amendment or waiver
affects the Mortgage Loans or any of the rights under the Agreement
with respect
thereto (other than the servicing of the Mortgage Loans, which
shall be enforced
by the Master Servicer) by the Trustee as assignee of MSMCI.
Section
2.03. Obligations of Seller Upon Sale. (a) In connection with
any
transfer pursuant to Section 2.01 hereof, the Seller further
agrees, at its own
expense, on or prior to the Closing Date, (x) to indicate in its
books and
records that the Mortgage Loans have been sold to the Purchaser
pursuant to this
Agreement and (y) to deliver to the Purchaser and the Trustee a
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computer file containing a true and complete list of all such
Mortgage Loans
specifying for each such Mortgage Loan, as of the Cut-off Date, its
account
number and Cut-off Date Principal Balance. Such file, which forms a
part of
Schedule A to the Pooling and Servicing Agreement, shall also be
marked as
Schedule I to this Agreement and is hereby incorporated into and
made a part of
this Agreement.
In connection with such transfer and assignment of the Mortgage
Loans, the Seller shall, on behalf of the Purchaser, deliver to and
deposit
with, the Custodian, as the agent of the Trustee, the documents or
instruments
set forth in Section 2.01(a) of the Pooling and Servicing Agreement
with respect
to each Mortgage Loan so transferred and assigned.
If any of the documents referred to above has as of the Closing
Date
been submitted for recording but either (x) has not been returned
from the
applicable public recording office or (y) has been lost or such
public recording
office has retained the original of such document, the obligations
of the Seller
to deliver such documents shall be deemed to be satisfied upon (1)
delivery to
the Custodian no later than the Closing Date, of a copy of each
such document
certified by the Seller in the case of (x) above or the applicable
public
recording office in the case of (y) above to be a true and complete
copy of the
original that was submitted for recording and (2) if such copy is
certified by
the Seller, delivery to the Custodian, promptly upon receipt
thereof of either
the original or a copy of such document certified by the applicable
public
recording office to be a true and complete copy of the original. If
the original
lender's title insurance policy on a Mortgage Loan was not
delivered as required
by this Section 2.01, the Seller shall deliver or cause to be
delivered to the
Custodian, a written commitment or interim binder or preliminary
report of title
issued by the title insurance or escrow company, with the original
to be
delivered to the Custodian, promptly upon receipt thereof. The
Seller shall
deliver or cause to be delivered to the Custodian promptly upon
receipt thereof
any other original documents constituting a part of a Mortgage File
received
with respect to any Mortgage Loan, including, but not limited to,
any original
documents evidencing an assumption or modification of any Mortgage
Loan.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File,
the Seller
shall have 90 days to cure such defect or deliver such missing
document to the
Trustee. If the Seller does not cure such defect or deliver such
missing
document within such time period, the Seller shall either
repurchase or
substitute for such Mortgage Loan in accordance with Section 2.05
of the Pooling
and Servicing Agreement.
The Purchaser hereby acknowledges its acceptance of all right,
title
and interest to the Mortgage Loans and other property, now existing
and
hereafter created, conveyed to it pursuant to Section 2.01.
The parties hereto intend that the transaction set forth herein be
a
sale by the Seller to the Purchaser of all the Seller's right,
title and
interest in and to the Mortgage Loans and other property described
above. In the
event the transaction set forth herein is deemed not to be a sale,
the Seller
hereby grants to the Purchaser a security interest in all of the
Seller's right,
title and interest in, to and under the Mortgage Loans and other
property
described above, whether now existing or hereafter created, to
secure all of the
Seller's obligations hereunder; and this
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Agreement shall constitute a security agreement under applicable
law. The Seller
and the Purchaser shall, to the extent consistent with this
Agreement, take such
actions as may be necessary to ensure that, if this Agreement were
deemed to
create a security interest in the Mortgage Loans, such security
interest would
be deemed to be a perfected security interest of first priority
under applicable
law and will be maintained as such throughout the term of the
Pooling and
Servicing Agreement.
Section
2.04. Payment of Purchase Price for the Mortgage Loans. In
consideration of the sale of the Mortgage Loans from the Seller to
the Purchaser
on the Closing Date, the Purchaser agrees to pay to the Seller on
the Closing
Date by transfer of immediately available funds, as directed by the
Seller, an
amount equal to $603,133,100 in respect of the Mortgage Loans (the
"Purchase
Price").
ARTICLE III.
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section
3.01. Seller Representations and Warranties Relating to the
Mortgage Loans. The Seller hereby represents and warrants to the
Purchaser, with
respect to the Mortgage Loans, that as of the Closing Date or as of
such date
specifically provided herein:
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct in all material respects as of the
Cut-off Date.
(b) Seller is the sole owner and holder of the Mortgage Loans
free
and clear of any liens, pledges, except for the pledge of the
Mortgage note by
Seller with a warehouse lender disclosed to Purchaser, charges or
security
interest of any nature, and has full right and authority to sell
and assign the
same.
(c) With respect to each Mortgage Loan that is not a Co-op Loan,
the
Mortgage is a valid, existing and enforceable first (or, if
indicated by Seller,
second) lien on the Mortgaged Property, including all improvements
on the
Mortgaged Property subject only to (i) the lien of current real
property taxes
and assessments not yet due and payable, (ii) covenants, conditions
and
restrictions, rights of way, easements and other matters of the
public record as
of the date of recording being acceptable to Mortgage lending
institutions
generally and specifically referred to in the owner's title
insurance policy
delivered to the originator of the Mortgage Loan and (x)
specifically referred
to or otherwise considered in the appraisal made for the originator
of the
Mortgage Loan or (y) which do not adversely affect the appraised
value of the
Mortgaged Property (or underlying Mortgaged Property (or underlying
Mortgaged
Property, in the case of a Co-op Loan), (iii) other matters to
which like
properties are commonly subject which do not materially interfere
with the
benefits of the security intended to be provided by the Mortgage or
the use,
enjoyment, value or marketability of the related Mortgaged Property
(or
underlying Mortgaged Property, in the case of a Co-op Loan) (iv)
with respect to
a second lien only, the lien of the first mortgage on the related
mortgaged
property. Any security agreement, chattel Mortgage or equivalent
document
related to and delivered in connection with the Mortgage loan
establishes and
creates a valid, existing and enforceable first (or, if indicated
by Seller,
second) lien and first (or if indicated by Seller, second) priority
security
interest on the property described
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therein and the Seller has the full right to sell and assign the
same to
Purchaser. With respect to each Co-op Loan, the related Mortgage is
a valid,
subsisting and enforceable first priority security interest on the
related
cooperative shares securing the Mortgage note, subject only to (i)
liens of the
related residential cooperative housing corporation for unpaid
assessments
representing the borrower's pro rata share of the related
residential
cooperative housing corporation's payment for its blanket Mortgage,
current and
future real property taxes, insurance premiums, maintenance fees
and other
assessments to which like collateral is commonly subject and (ii)
other matters
to which like collateral is commonly subject to which do not
materially
interfere with the benefits of the security interest intended to be
provided by
the related security agreement.
(d) The Mortgage Loan is not in default and all monthly payments
due
prior to the transaction have been paid and all taxes, assessments
and insurance
premiums, water, sewer and municipal charges, leasehold payments or
ground rents
relating to the property secured by the Mortgage Loan have been
paid. Seller has
not advanced funds or induced or solicited any advances or funds by
a party
other than a borrower directly or indirectly, for the payment of
any amounts
required by the Mortgage loans.
(e) With respect to escrow deposits and escrow payments, all
such
payments are in the possession of Seller and there exist no
deficiencies in
connection therewith for which customary arrangements for repayment
thereof have
not been made.
(f) The terms of the Mortgage Note and Mortgage have not been
impaired, waived, altered or modified in any respect from the date
of
origination, except by a written instrument which has been
recorded, if
necessary to protect the interest of Purchaser, and which has been
delivered to
Purchaser or to such other person as Purchaser shall designate in
writing. The
substance of any such waiver, alteration or modification has been
approved by
the issuer of any related private mortgage insurance policy and the
title
insurer, if any, to the extent required by the policy. No borrower
has been
released, in whole or in part, except in connection with an
assumption
agreement, approved by the issuer of any related private mortgage
insurance
policy and the title insurer, to the extent required by the policy,
and which
assumption agreement is part of the mortgage file delivered to
Purchaser or to
such other person as Purchaser shall designate in writing.
(g) The Mortgage Loan is not subject to any right of
rescission,
set-off, counter claim or defense and is not unenforceable under
any terms. The
Mortgage note, the Mortgage and any other agreement executed and
delivered by a
borrower or guarantor, if applicable, are genuine, legal, valid,
binding and
enforceable obligations of the maker thereof. All parties to the
Mortgage note
and any other agreement executed and delivered by a borrower or
guarantor, if
applicable, had legal capacity to execute such documents and all
such documents
have, in fact, been properly executed by such parties.
(h) The Mortgage Loan has not been satisfied, cancelled,
subordinated or rescinded, in whole or in part (other than as to
principal
prepayments in full which may have been received prior to the
transaction date),
and the Mortgaged Property has not been released from the lien of
the Mortgage,
in whole or in part, nor has any instrument been executed that
would effect any
such satisfaction, cancellation, subordination, rescission or
release.
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(i) The Mortgaged Property (or underlying Mortgaged Property, in
the
case of a Co-op Loan) and all improvements thereon are insured
against loss by
fire and other such hazards as are customary in the area where the
Mortgaged
Property (or underlying Mortgaged Property, in the case of a Co-op
Loan) is
located. Such coverage shall contain fire and hazard insurance
policy with
extended coverage as called for under the Seller's guide. Such
insurance policy
and any other insurance policy related to the Mortgage Loan or the
Mortgaged
Property (or underlying Mortgaged Property, in the case of a Co-op
Loan)
contains a standard Mortgagee clause naming Seller and its
successors and
assigns as Mortgagee and loss payee. Each Mortgage obligates the
borrower there
under to maintain such insurance at their costs and expense and
allows the
Mortgagee to obtain and maintain such insurance at borrower's costs
and expense,
and to seek reimbursement from the borrower should there be any
failure by the
borrower to maintain such policy. If any flood insurance is
required by
applicable law or pursuant to the Mortgage Loan documents or any
other
applicable requirement, then it has been obtained and in full force
and effect.
Any statements made by the borrower or the Seller in applications
for such
policies were true, complete and correct at the time the
application was made
and there are no events that have occurred since that policy was
issued that
would affect the stated coverage of the policy.
(j) Any and all requirements of any federal, state or local law
which include, but are not limited to usury, truth-in-lending, real
estate
settlement procedures, disclosure laws, consumer credit protection
and equal
credit opportunity have been complied with.
(k) The proceeds of the Mortgage Loan have been fully disbursed
and
there is no requirement or anticipation of future advances there
under (other
than any escrow holdbacks retained pursuant to the terms of a
related
construction loan). All costs, fees and expenses incurred in
making, closing or
recording the Mortgage Loan have been paid.
(l) Each Mortgage Loan that is not a Co-op Loan is covered by
an
ALTA lender's title insurance policy or other generally acceptable
form of
policy, or with respect to any mortgage loan for which the related
mortgaged
property is located in California, a CLTA lender's title insurance
policy, or
insurance acceptable to Fannie Mae or Freddie Mac, issued by a
title insurer
acceptable to Fannie Mae or Freddie Mac and qualified to do
business in the
jurisdiction where the Mortgaged Property is located, insuring
(subject to the
exceptions contained in paragraph (c) above) the Seller, its
successors and
assigns, as to the first (or, if indicated by Seller, second)
priority lien of
the Mortgage in the original principal amount of the Mortgage Loan,
subject only
to the exceptions contained in clauses (i), (ii), (iii) and (iv) of
paragraph
(c) of this Section 3.01, and in this case of adjustable rate
mortgage loans,
against any loss by reason of the invalidity or unenforcability of
the lien
resulting from the provisions of the mortgage providing for
adjustment to the
mortgage interest rate and monthly payment. Where required by
applicable state
law or regulation, the Mortgagor has been given the opportunity to
choose the
carrier of the required mortgage title insurance. The Seller, its
successors and
assigns, are the sole insureds of such lender's title insurance
policy and such
lender's title insurance policy is in full force and effect and
will be in full
force and effect upon the consummation of the transactions
contemplated by this
Agreement. No claims have been made under such lender's title
insurance policy,
and no prior holder of the related Mortgage, including the Seller,
has done, by
act or omission, anything which would impair the coverage of such
lender's title
insurance policy.
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(m) There is no default, breach, violation, anticipated breach
or
event of acceleration existing under the Mortgage or the related
Mortgage Note
and no existing or known event which, with the passage of time, (or
with notice
and the expiration of any grace or cure period) would constitute a
default,
breach, violation or event of acceleration under such Mortgage or
the related
Mortgage Note.
(n) At settlement of the Mortgage Loan, and, to the Seller's
knowledge as of the transaction date, there were no mechanic's
liens or claims
for work, labor or material affecting the Mortgaged Property (or
the related
residential dwelling unit at the underlying mortgaged property, in
the case of a
Co-op Loan) which are or may be a lien prior to the lien of such
Mortgage except
those which are insured against by the title insurance policy.
(o) With respect to each mortgage loan, which is not a Co-op
Loan,
all improvements subject to the Mortgage which were considered in
determining
the appraised value of the Mortgaged Property lie wholly within the
boundaries
and building restriction lines of the Mortgaged Property except for
de minimis
encroachments permitted by the Fannie Mae Guide and which have been
noted on the
appraisal or the title policy affirmatively insures against loss or
damage by
reason of any violation, variation or encroachment or adverse
circumstance which
is either disclosed or would have been disclosed by an accurate
survey, and no
improvements on adjoining properties encroach upon the Mortgaged
Property except
those which are insured against by the title insurance policy
referred to in
clause (m) above or are acceptable under Fannie Mae or Freddie Mac
guidelines
and all improvements on the property comply with all applicable
zoning and
subdivision laws and ordinances.
(p) Except for approximately 0.24% of the Mortgage Loans, by
aggregate stated principal balance as of the Cut-off Date, each
Mortgage Loan
substantially complies with all the terms, conditions and
requirements of
Seller's standards in effect at the time of origination of such
Mortgage Loan.
With respect to the remaining Mortgage Loans, each such Mortgage
Loan complies
with all the terms, conditions and requirements of the related
originator's
standards in effect at the time of origination of such Mortgage
Loan. The
Mortgage Notes and Mortgages (exclusive of any riders)
are
