Exhibit 4.1
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CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.,
Depositor
CITIMORTGAGE, INC.,
Servicer and Certificate Administrator
U.S. BANK NATIONAL ASSOCIATION,
Trustee
And
CITIBANK, N.A.,
Paying Agent, Certificate Registrar and Authenticating Agent
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POOLING AND SERVICING AGREEMENT
Dated as of June 1, 2007
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REMIC PASS-THROUGH CERTIFICATES,
SERIES 2007-2
ARTICLES I-XI INCORPORATION BY REFERENCE
ARTICLE XII TERMS FOR SERIES 2007-2 CERTIFICATES
Section 12.01. General Terms for Certificates........................
Section 12.02. Additional Terms and Definitions......................
Section 12.03. Wire Transfer Eligibility.............................
Section 12.04. REMIC-Related Provisions..............................
Section 12.05. Expenses and Liabilities of the Trust Fund............
Section 12.06. Tax Matters Person....................................
Section 12.07. [Reserved]............................................
ARTICLE XIII SUBORDINATION; PRIORITIES; ALLOCATION OF LOSSES
Section 13.01. Subordination; Priority of Distributions..............
Section 13.02. Allocation of Realized Losses; Recoveries.............
Section 13.03. [Reserved]............................................
Section 13.04. Distributions on the Class R Certificate..............
ARTICLE XIV ADDITIONAL PROVISIONS
Section 14.01. Additional Representations and Warranties.............
Section 14.02. Additional Servicing Events of Default................
Section 14.03. Additional Conditions for Subsequent Transfer
Dates.................................................
Section 14.04. Additional Certificate Information....................
Section 14.05. Additional Pool Information...........................
SCHEDULES
SCHEDULE 1 Servicing Criteria to be Addressed in Report on Assessment of
Compliance
SCHEDULE 2 Additional Form 10-D Disclosure
SCHEDULE 3 Additional Form 10-K Disclosure
SCHEDULE 4 Form 8-K Disclosure Information
EXHIBITS
EXHIBIT A-1 Form of Class A Certificates
EXHIBIT A-2 Form of Class M Certificates
EXHIBIT A-3 Form of Class CE Certificates
EXHIBIT A-4 Form of Class R Certificate
EXHIBIT B Schedule of Mortgage Loans
EXHIBIT C Form of Purchaser Letter
EXHIBIT D Form of ERISA Letter
EXHIBIT E Form of Servicer Certification
EXHIBIT F Mortgage Document Custodial Agreement
THIS POOLING AND SERVICING AGREEMENT ("this Pooling Agreement" or "this
Agreement"), dated as of June 1, 2007, among CITICORP RESIDENTIAL MORTGAGE
SECURITIES, INC., a Delaware corporation, as depositor ("CRMSI" or the
"Depositor"), CITIMORTGAGE, INC., a New York corporation, as servicer (the
"Servicer") and certificate administrator (the "Certificate Administrator"),
U.S. BANK NATIONAL ASSOCIATION, a national banking association, as trustee (the
"Trustee"), and CITIBANK, N.A., a national banking association, as paying agent
(the "Paying Agent"), certificate registrar (the "Certificate Registrar") and
authenticating agent (the "Authenticating Agent").
WITNESSETH THAT:
In the regular course of their business, certain affiliates of CRMSI
originate and acquire Mortgage Loans. CRMSI, the Servicer and the Trustee wish
to set forth the terms and conditions pursuant to which CRMSI will sell to the
Trust Fund the Mortgage Loans listed on Exhibit B hereto. Certificates will be
issued to Holders evidencing ownership interests in such Trust Fund and the
Servicer will manage and service such Mortgage Loans. In consideration of the
mutual agreements herein contained, CRMSI, the Servicer and the Trustee agree as
follows:
ARTICLES I-XI
INCORPORATION BY REFERENCE
Those certain Standard Terms for Pooling and Servicing Agreements dated
as of June 1, 2007 (the "Standard Terms"), a copy of which is attached hereto,
as amended, superseded and supplemented hereby, are incorporated by reference
herein as if set forth in full. Such Standard Terms, as so amended, superseded
and supplemented, are hereby affirmed by, and shall constitute a part of this
Agreement between, the parties hereto. For purposes of this Pooling Agreement
and the Certificates executed and delivered hereunder, the terms "this
Agreement," "herein," "hereof" and words of similar import shall refer to this
Pooling Agreement including the Standard Terms as incorporated herein with such
modifications or amendments for the related series of Certificates as may be set
forth in this Pooling Agreement.
ARTICLE XII
TERMS FOR SERIES 2007-2 CERTIFICATES
On June 28, 2007, there shall be established pursuant to the terms of,
and authenticated under, this Pooling Agreement a series of certificates known
and designated as "Citicorp Residential Mortgage Securities, Inc. REMIC
Pass-Through Certificates, Series 2007-2". Elections will be made pursuant to
this Agreement to treat the Trust as two REMICs for federal income tax purposes.
The Certificates shall consist of (i) one Class consisting of seven Subclasses
of Certificates (each a "Class A Subclass") designated as "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Senior
Class A-1a Certificates" (the "Class A-1a Certificates"), "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Senior
Class A-1b Certificates" (the "Class A-1b Certificates"), "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Senior
Class A-2 Certificates" (the "Class A-2 Certificates"), "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Senior
Class A-3 Certificates" (the "Class A-3 Certificates"), "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Senior
Class A-4 Certificates" (the "Class A-4 Certificates"), "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Senior
Class A-5 Certificates" (the "Class A-5 Certificates"), and "Citicorp
Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2007-2, Senior Class A-6 Certificates" (the "Class A-6 Certificates" and,
collectively, together with the Class A-1a, Class X-0x, Xxxxx X-0, Class A-3,
Class A-4 and Class A-5 Certificates, the "Class A Certificates"); (ii) one
Class consisting of nine Subclasses (each a "Class M Subclass") of Certificates
designated as "Citicorp Residential Mortgage Securities, Inc., REMIC
Pass-Through Certificates, Series 2007-2, Subordinated Class M-1 Certificates"
(the "Class M-1 Certificates"), "Citicorp Residential Mortgage Securities, Inc.
REMIC Pass-Through Certificates, Series 2007-2, Subordinated Class M-2
Certificates" (the "Class M-2 Certificates"), "Citicorp Residential Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Subordinated
Class M-3 Certificates" (the "Class M-3 Certificates"), "Citicorp Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2,
Subordinated Class M-4 Certificates" (the "Class M-4 Certificates"), "Citicorp
Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2007-2, Subordinated Class M-5 Certificates" (the "Class M-5 Certificates"),
"Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates,
Series 2007-2, Subordinated Class M-6 Certificates" (the "Class M-6
Certificates"), "Citicorp Residential Mortgage Securities, Inc. REMIC
Pass-Through Certificates, Series 2007-2, Subordinated Class M-7 Certificates"
(the "Class M-7 Certificates"), "Citicorp Residential Mortgage Securities, Inc.
REMIC Pass-Through Certificates, Series 2007-2, Subordinated Class M-8
Certificates" (the "Class M-8 Certificates"), and "Citicorp Residential Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 2007-2, Subordinated
Class M-9 Certificates" (the "Class M-9 Certificates", and together with the
Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7 and
Class M-8 Certificates, collectively, the "Class M Certificates"); (iii) one
Class of Certificates designated as "Citicorp Residential Mortgage Securities,
Inc. REMIC Pass-Through Certificates, Series 2007-2, Subordinated Class CE
Certificates" (the "Class CE Certificates") and (iv) one class of residual
interests designated as "Citicorp Residential Mortgage Securities, Inc. REMIC
Pass-Through Certificates, Series 2007-2, Class R Certificate" (the "Class R
Certificate" and, together with the Class A, Class M and Class CE Certificates,
the "Certificates").
For the avoidance of doubt, all of the Certificates are of the same
Group (as such term is defined in the Standard Terms) and all of the Mortgage
Loans are in the same Pool (as such term is defined in the Standard Terms).
The Class A-1a, Class X-0x, Xxxxx X-0, Class A-3, Class A-4, Class X-0,
Xxxxx X-0, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class M-7, Class M-8 and Class M-9 Certificates (exclusive of their respective
rights to receive Class A Subclass Cap Amounts or Class M Subclass Cap Amounts,
as applicable) and the Class CE Certificates (exclusive of their obligation to
pay Class A Subclass Cap Amounts or Class M Subclass Cap Amounts) are hereby
designated as "regular interests" in the Upper-Tier REMIC within the meaning of
Code Section 860G(a)(1). The Class R Certificate represents ownership of the
Class LT-R Interest, which is the "residual interest" in the Lower-Tier REMIC,
and the Class UT-R Interest, which is the "residual interest" in the Upper-Tier
REMIC within the meaning of Code Section 860G(a)(2). The Certificates shall have
the terms provided for in this Agreement.
Section 12.01.General Terms for Certificates.
(a) The Class A Certificates, the Class M Certificates, Class CE
Certificates and Class R Certificate shall have the following respective Initial
Principal Balances and Certificate Rates:
Certificate
Initial Principal Balance Rate(1)
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Class A-1a Certificates $62,000,000.00 5.983%
Class A-1b Certificates $244,354,000.00 (2)
Class A-2 Certificates $104,317,000.00 5.977%
Class A-3 Certificates $86,611,000.00 6.080%
Class A-4 Certificates $117,958,000.00 6.538%
Class A-5 Certificates $49,274,000.00 6.652%
Class A-6 Certificates $73,835,000.00 6.265%
Class M-1 Certificates $20,714,000.00 6.391%
Class M-2 Certificates $18,124,000.00 6.440%
Class M-3 Certificates $11,220,000.00 6.490%
Class M-4 Certificates $10,357,000.00 6.589%
Class M-5 Certificates $9,493,000.00 6.787%
Class M-6 Certificates $8,631,000.00 6.886%
Class M-7 Certificates $6,905,000.00 7.000%
Class M-8 Certificates $4,315,000.00 7.000%
Class M-9 Certificates $8,631,000.00 7.000%
Class CE Certificates (3) (4)
Class R Certificate (5) (5)
(1) For all Interest Accrual Periods commencing after the Optional
Termination Date, the Certificate Rate for each Class of Certificates
(other than Class A-1b, Class R and Class CE) will be the applicable
rate set forth above plus 0.50% per annum.
(2) Interest will accrue on the Class A-1b Certificates during each Interest
Accrual Period at a per annum rate equal to the sum of (x) One-Month
LIBOR for such Interest Accrual Period plus (y) the Class A-1b Margin
for such Interest Accrual Period. The "Class A-1b Margin" shall be 0.09%
for all Interest Accrual Periods commencing on or prior to the Optional
Termination Date, and shall be 0.18% for all Interest Accrual Periods
commencing after the Optional Termination Date. With respect to the
first Interest Accrual Period, interest will accrue on the Class A-1b
Certificates at a per annum rate equal to 5.410%.
(3) For federal income tax purposes, the Class CE Certificates will be
treated as having a Principal Balance equal to the Overcollateralization
Amount.
(4) The Class CE Certificates have no Certificate Rate.
(5) The Class R Certificate has no Principal Balance or Certificate Rate.
The Class CE Certificates and the Class R Certificate will be entitled
to distributions as set forth herein.
The last scheduled distribution date is June 25, 2037 for each Class,
and is the "latest possible maturity date" of the related Subclass or Class for
purposes of Section 860G(a)(1) of the Code and Treasury Regulations Section
1.860G-1(a)(4)(iii).
(b) For each Distribution Date, each of the Class A Certificates and
Class M Certificates will accrue interest on their respective Principal Balances
during the related Interest Accrual Period at the lesser of (x) the applicable
Certificate Rate for such Subclass or Class set forth in Section 12.01(a) and
(y) the Net WAC Rate for such Distribution Date. Interest accrued on the
Certificates during any Interest Accrual Period will be calculated on the
assumption that any distributions in reduction of Principal Balance on all
Certificates were made, and any allocations of any losses were made, on the day
immediately following the last day of the preceding Interest Accrual Period.
Each Class A Subclass Interest Amount and each Class M Subclass Interest Amount
relating to an Interest Accrual Period shall be distributable on the following
Distribution Date. Each Subclass and Class of Certificates shall accrue interest
from the applicable Accrual Date for such Subclass and Class of Certificates.
Interest on the Certificates (other than the Class A-1b, Class CE or
Class R Certificates) will be calculated on the basis of a 360-day year
comprised on twelve 30-day months. Interest on the Class A-1b Certificates will
be calculated on the basis of the actual number of days in the related Interest
Accrual Period and a 360-day year. On each Distribution Date, each Class A
Subclass Interest Amount and each Class M Subclass Interest Amount for such
Subclass for such Distribution Date shall be distributable to such Subclass or
Class of Certificates.
(c) [Reserved].
(d) Subject to the provisions of Section 13.01, on each Distribution
Date prior to the Subordination Depletion Date, the Senior Principal
Distribution Amount will be allocated among and distributed in reduction of the
Principal Balance of the Subclasses of the Class A Certificates sequentially as
follows:
(I) first, to the Class A-6 Certificates, the Class A-6
Priority Amount for such Distribution Date; and
(II) then, the amount remaining after application
according to clause (I) above, sequentially as
follows:
(1) to the Class A-1a and Class A-1b
Certificates, pro rata, based on their
respective outstanding Principal Balances,
until their respective Principal Balances are
reduced to zero,
(2) to the Class A-2 Certificates until their
Principal Balance is reduced to zero,
(3) to the Class A-3 Certificates until their
Principal Balance is reduced to zero,
(4) to the Class A-4 Certificates until their
Principal Balance is reduced to zero,
(5) to the Class A-5 Certificates until their
Principal Balance is reduced to zero, and
(6) to the Class A-6 Certificates until their
Principal Balance is reduced to zero.
(e) On each Distribution Date on or after the Subordination Depletion
Date, notwithstanding the priorities set forth in Section 12.01(d), the Senior
Principal Distribution Amount will be distributed pro rata to the Class A
Subclasses, based on outstanding Principal Balances.
(f) On each Distribution Date, distributions in reduction of the
Principal Balance made to each Class A Subclass will be distributed pro rata
among the holders of Certificates of such Class A Subclass.
(g) On each Distribution Date, subject to the provisions of Section
13.01, distributions in reduction of Principal Balance of the Subclasses of
Class M Certificates will be made in an aggregate amount equal to the applicable
Class M Subclass Principal Distribution Amount, respectively, in accordance with
the priorities set forth in Section 13.01(b).
(h) Other distributions shall be made in respect of the Certificates as
provided in Section 13.01.
Section 12.02.Additional Terms and Definitions.The Certificates shall
have and be subject to the following additional specific terms:
Accrual Date. For each Class or Subclass of interest-bearing
Certificates other than the Class A-1b Certificates, the Cut-Off Date, and for
the Class A-1b Certificates, the Closing Date.
Authenticating Agent. Citibank, N.A., Agency and Trust, 000 Xxxxxxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: CRMSI 2007-2 has been
appointed by the Trustee as an Authenticating Agent pursuant to Section 8.12.
Any such Authenticating Agent may be removed, and any other Authenticating Agent
appointed, as permitted by Section 8.12 and shall have the rights, privileges,
benefits, exculpatory provisions and protections of the Trustee as set forth in
Sections 8.01, 8.02, 8.03 and 8.04.
Book-Entry Certificates. All Subclasses of Class A Certificates and all
Subclasses of Class M Certificates are Book-Entry Certificates.
Cap Amounts. Any Class A Subclass Cap Amount or Class M Subclass Cap
Amount.
Capitalized Interest Account. Not applicable.
Cash Deposited into Collection Account. No cash will be deposited into
the Collection Account on the Issue Date.
Certificate Administrator. CitiMortgage, Inc. shall act as the initial
Certificate Administrator, which appointment is hereby approved by the Trustee.
The Certificate Administrator is authorized to take actions permitted or
required thereof under this Agreement. The Certificate Administrator may be
removed, and any other Certificate Administrator reasonably acceptable to the
Trustee appointed, by the Servicer.
Certificate Rate. The Certificate Rates for the Certificates are as set
forth in Section 12.01(a).
Certificate Registrar. Citibank, N.A., having its principal offices
located at 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
15th Floor Window, is hereby appointed as the Certificate Registrar for all of
the Certificates pursuant to Section 5.02 and shall have the rights, privileges,
benefits, exculpatory provisions and protections of the Trustee as set forth in
Sections 8.01, 8.02, 8.03, 8.04, 8.07, and 8.09.
Class A Principal Balance. As of any date, the sum of the Class A
Subclass Principal Balances of the Class A Certificates.
Class A Subclass Cap Amount. For a Distribution Date and any Class A
Subclass, the sum of (x) the difference (if greater than zero) between the
Normal Accrual for such Class A Subclass for the related Interest Accrual Period
and the WAC Accrual for such Class A Subclass for the related Interest Accrual
Period and (y) any Class A Subclass Cap Amount remaining unpaid on the prior
Distribution Date after giving effect to all payments made on such prior
Distribution Date, plus interest on the amount thereof at its Certificate Rate
for the related Interest Accrual Period for the Distribution Date in question.
Class A Subclass Interest Shortfall. For a Distribution Date and any
Class A Subclass, the sum of (x) any Class A Subclass Interest Shortfall Amount
for such Subclass for such Distribution Date and (y) any Class A Subclass
Interest Shortfall for such Subclass for the prior Distribution Date and
remaining unpaid after application of all payments on such prior Distribution
Date plus interest on the amount thereof at the lower of (x) the applicable
Certificate Rate for the Interest Accrual Period related to the Distribution
Date in question and (y) the Net WAC Rate for the Distribution Date in question.
Class A Subclass Principal Distribution Amount. For each Distribution
Date and any Class A Subclass, the amount of principal distributed to such Class
A Subclass pursuant to clause 1.d of Section 13.01(b).
Class A-1b Margin: As defined in Section 12.01(b).
Class A-6 Percentage. The Principal Balance of the Class A-6
Certificates, divided by the aggregate Subclass Principal Balances of the Class
A Certificates.
Class A-6 Priority Amount. For any Distribution Date means the lesser of
(A) the Principal Balance of the Class A-6 Certificates and (B) the product of
(a) the Class A-6 Percentage, (b) the Class A-6 Shift Percentage and (c) the
Senior Principal Distribution Amount.
Class A-6 Shift Percentage. For any Distribution Date will be the
percentage indicated below:
Class A-6
Distribution Date Occurring In Shift Percentage
------------------------------ ----------------
July 2007 through June 2010........................ 0%
July 2010 through June 2012........................ 45%
July 2012 through June 2013........................ 80%
July 2013 through June 2014........................ 100%
July 2014 and thereafter........................... 300%
Class CE Distributable Amount. On any Distribution Date, the sum of (i)
as a distribution in respect of interest, the amount of interest that has
accrued on the Class CE Interest and not applied as an Extra Principal
Distribution Amount on such Distribution Amount on such Distribution Date, plus
any such accrued interest remaining undistributed from prior Distribution Dates,
plus (without duplication) (ii) as a distribution in respect of principal, any
portion of the Principal Balance of the Class CE Interest which is distributable
as a Release Amount, minus (iii) any amounts paid in respect of the Class A
Subclass Cap Amounts or the Class M Subclass Cap Amounts.
Class LT-Accrual Interest. One of the separate non-certificated
beneficial ownership interests in the Lower-Tier REMIC issued hereunder and
designated as a regular interest in the Lower-Tier REMIC. Class LT-Accrual
Interest shall accrue interest at the related Interest Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to 1/2 of the Pool
Balance plus 1/2 of the Overcollateralization Amount, as set forth in Section
12.04(a).
Class LT-R Interest. The residual interest in the Lower-Tier REMIC as
described in Section 12.04(a) and the related footnote thereto.
Class M Factor. For Class M-1, 75.90%; for Class M-2, 80.10%; for Class
M-3, 82.70%; for Class M-4, 85.10%; for Class M-5, 87.30%; for Class M-6,
89.30%; for Class M-7, 90.90%; for Class M-8, 91.90% and for Class M-9, 93.90%.
Class M Subclass Cap Amount. For a Distribution Date and any Class M
Subclass, the sum of (x) the difference (if greater than zero) between the
Normal Accrual for such Class M Subclass for the related Interest Accrual Period
and the WAC Accrual for such Class M Subclass for the related Interest Accrual
Period and (y) any Class M Subclass Cap Amount remaining unpaid on the prior
Distribution Date after giving effect to all payments made on such prior
Distribution Date, plus interest on the amount thereof at the applicable
Certificate Rate for the related Interest Accrual Period for the Distribution
Date in question.
Class M Subclass Interest Shortfall. For a Distribution Date and any
Class M Subclass, the sum of (x) any Class M Subclass Interest Shortfall Amount
for such Subclass for such Distribution Date and (y) any Class M Subclass
Interest Shortfall for such Subclass for the prior Distribution Date and
remaining unpaid after application of all payments on such prior Distribution
Date plus interest on the amount thereof at the lower of (x) the applicable
Certificate Rate for the Interest Accrual Period related to the Distribution
Date in question and (y) the Net WAC Rate for the Distribution Date in question.
Class M Subclass Principal Distribution Amount. For any Distribution
Date on or after the Stepdown Date and on which a Trigger Event is not in
effect, an amount for a particular Class M Subclass equal to the excess of
(a) the sum of (x) the Class A Principal Balance and the Class M
Subclass Principal Balance for each Class M Subclass having a lower numerical
designation (after giving effect to the payment on such Distribution Date of the
Senior Principal Distribution Amount and each Class M Subclass Principal
Distribution Amount for a Class M Subclass having a lower numerical designation)
and (y) the Class M Subclass Principal Balance of the Class M Subclass in
question immediately prior to such Distribution Date over
(b) the lesser of (x) the Class M Factor for such Class M Subclass times
the Pool Balance as of the end of the related Collection Period and (y) the Pool
Balance as of the end of the related Collection Period minus the OC Floor
Amount.
For any other Distribution Date, (a) if the Class A Principal Balance has not
been reduced to zero and either (x) such Distribution Date is prior to the
Stepdown Date or (y) a Trigger Event is in effect, each Class M Subclass
Principal Distribution Amount shall be zero and (b) if the Class A Principal
Balance has been reduced to zero and either (x) such Distribution Date is prior
to the Stepdown Date or (y) a Trigger Event is in effect, the Class M Subclass
Principal Distribution Amount for a particular Class M Subclass shall be equal
to the lesser of (1) 100% of the Principal Distribution Amount minus the sum of
the Class M Subclass Principal Distribution Amounts for each Class M Subclass
with a lower numerical designation and (2) the Class M Subclass Principal
Balance of such Class M Subclass.
Class UT-R Interest. The residual interest in the Upper-Tier REMIC as
described in Section 12.04(a) and the related footnote thereto.
Closing Date. June 28, 2007.
Constituent REMIC. The Upper-Tier REMIC and the Lower-Tier REMIC shall
be the "Constituent REMICs" for purposes of Section 3.11.
Corporate Trust Office. The Corporate Trust Office is located at U.S.
Bank National Association, having its principal offices located at Xxx Xxxxxxx
Xxxxxx--0xx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Corporate Trust
Services, Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series 2007-2, or such other address as shall be identified to
CRMSI and all Certificateholders by or on behalf of the Trustee in writing.
Cumulative Loss Test. The Cumulative Loss Test will be failed on a
Distribution Date if the Cumulative Loss Percentage equals or exceeds (1) with
respect to Distribution Dates from July 2009 through June 2010, inclusive,
0.65%, (2) with respect to Distribution Dates from July 2010 through June 2011,
inclusive, 1.45%, (3) with respect to Distribution Dates from July 2011 through
June 2012, inclusive, 2.45%, (4) with respect to Distribution Dates from July
2012 through June 2013, inclusive, 3.25% and (5) with respect to Distribution
Dates from July 2013 and thereafter, 3.85%.
Current Class A Enhancement Level. As of any Distribution Date, the
percentage obtained by dividing (i) the sum of the Class M Subclass Principal
Balances of the Class M Certificates and the Overcollateralization Amount (prior
to giving effect to any distributions in reduction of Principal Balance and the
allocation of any losses on such date) by (ii) the Pool Balance as of the last
day of the related Collection Period.
Current Interest. For a Distribution Date, the sum of the Class A
Subclass Interest Amounts and Class M Subclass Interest Amounts.
Current Pool Balance. For any date, the Pool Balance.
Cut-Off Date. The Cut-Off Date is the beginning of business on June 1,
2007.
Daily Servicing Fee Accrual Amount. For each Mortgage Loan during each
day during each Collection Period, an amount equal to (a) the product of (i) the
Servicing Fee Rate and (ii) the Loan Balance of such Mortgage Loan as of such
day, divided by (b) 360.
Definitive Certificates. The Class CE Certificates and the Class R
Certificate will be issued in fully registered certificated form.
Delinquency Test. The Delinquency Test will be failed on a Distribution
Date if the Rolling Sixty-Day Delinquency Rate for such Distribution Date is
greater than 32.53% of the Current Class A Enhancement Level as of such
Distribution Date.
Denominations. The denominations of each Subclass of the Class A
Certificates and Class M Certificates are $100,000 Initial Principal Balance and
integral multiples of $1 in excess thereof (except that one Certificate of each
Class or Subclass may be issued in a different denomination). The denominations
of the Class CE Certificates and Class R Certificate are 100% Percentage
Interest.
Depository. The initial Depository is Citibank, N.A.
Determination Date. The Determination Date for each Distribution Date is
the close of business on the 18th day (or, if such day is not a Business Day,
the preceding Business Day) of the month in which the related Distribution Date
occurs.
Distribution Date. Each Distribution Date shall be the 25th day of each
month (or if such day is not a Business Day, the next succeeding Business Day),
commencing in July 2007.
Enhancement Date: The first Distribution Date on which the Current Class
A Enhancement Level is greater than or equal to the Required Class A Enhancement
Level.
ERISA Restricted Certificates. The Class CE Certificates and Class R
Certificate.
Extra Principal Distribution Amount. For any Distribution Date, the
lesser of (x) Monthly Excess Interest and (y) the Deficiency Amount.
Initial Pool Balance. $863,062,412.17.
Initial Principal Balance. The Initial Principal Balance for each
Subclass of the Class A Certificates and for each Subclass of the Class M
Certificates and for the Class R Certificate is as set forth in Section
12.01(a).
Interest Accrual Period. The Interest Accrual Period for any given
Distribution Date is (x) for all Certificates other than the Class A-1b, Class
CE or Class R Certificates, the period from and including the first day of the
month preceding the month of such given Distribution Date to and including the
last day of the month preceding the month of such Distribution Date, and (y) for
the Class A-1(b) Certificates, the period from and including the immediately
preceding Distribution Date (or, in the case of the first Distribution Date, the
Closing Date) to and including the day before such given Distribution Date.
Investment Account. None of the Collection Account or the Certificate
Account will be an Investment Account.
Issue Date. The Issue Date is June 28, 2007.
Last Scheduled Distribution Date. The Last Scheduled Distribution Date
for each Class of Certificates is as set forth in Section 12.01(a).
LIBOR Determination Date. The date that is two London Business Days
preceding the relevant Interest Accrual Period for the Class A-1b Certificates.
London Business Day. A day on which dealings in deposits in U.S. dollars
are transacted in the London interbank market.
Lower-Tier REMIC. The designated portion of the Trust Fund consisting of
the Mortgage Loans, proceeds thereof, any related REO Property and all other
property of the Trust Fund other than the assets of the Upper-Tier REMIC and the
right of the Class A Certificates and the Class M Certificates to receive, and
the obligation of the Class CE Certificates to pay, Cap Amounts.
Lower-Tier REMIC Principal Amount. On the Closing Date, with respect to
each Lower-Tier REMIC Regular Interest, the amount set forth in the chart under
the heading "Lower-Tier REMIC" in Section 12.04, and on any subsequent date, as
reduced by distributions of principal and Realized Losses and as increased by
Subsequent Recoveries, as set forth in Section 12.04.
Lower-Tier REMIC Regular Interest. As defined in Section 12.04.
LT Accretion Directed Classes. As defined in Section 12.04(a).
Mortgage Note Custodian. Citibank, N.A. is designated by the Trustee as
the Mortgage Note Custodian.
Net Civil Relief Amount. For a Distribution Date and any Class A
Subclass and Class M Subclass, the sum of (x) any Civil Relief Shortfall Amount
for such Subclass for such Distribution Date and (y) the aggregate of all Civil
Relief Shortfall Amounts for such Subclass for all prior Distribution Dates,
minus the aggregate amount of payments made in respect thereof on all prior
Distribution Dates pursuant to Section 13.01(b)(1)(f).
Net Class A WAC Cap Amount. For a Distribution Date and any Class A
Subclass, the sum of (x) any Class A Subclass Cap Amount for such Subclass for
such Distribution Date and (y) the aggregate of all Class A Subclass Cap Amounts
for such Subclass for all prior Distribution Dates, minus the aggregate amount
of payments made in respect thereof on all prior Distribution Dates pursuant to
Section 13.01(b)(1)(g), plus interest on the amount thereof at the applicable
Certificate Rate for the Interest Accrual Period related to the Distribution
Date in question; provided that, on any Distribution Date after the Principal
Balance of a Class A Subclass has been reduced to zero, the Net Class A WAC Cap
Amount for such Class A Subclass shall be zero.
Net Class M WAC Cap Amount. For a Distribution Date and any Class M
Subclass, the sum of (x) any Class M Subclass Cap Amount for such Subclass for
such Distribution Date and (y) the aggregate of all Class M Subclass Cap Amounts
for such Subclass for all prior Distribution Dates, minus the aggregate amount
of payments made in respect thereof on all prior Distribution Dates pursuant to
Section 13.01(b)(1)(g), plus interest on the amount thereof at the applicable
Certificate Rate for the Interest Accrual Period related to the Distribution
Date in question; provided that, on any Distribution Date after the Principal
Balance of a Class M Subclass has been reduced to zero, the Net Class M WAC Cap
Amount for such Class M Subclass shall be zero.
Net Non-Supported Amount. For a Distribution Date and any Class A
Subclass and Class M Subclass, the sum of (x) any Unsupported Prepayment
Interest Shortfall for such Subclass for such Distribution Date and (y) the
aggregate of all Unsupported Prepayment Interest Shortfalls for such Subclass
for all prior Distribution Dates, minus the aggregate amount of payments made in
respect thereof on all prior Distribution Dates pursuant to Section
13.01(b)(1)(f).
Net WAC Rate. For a Distribution Date, a per annum rate equal to the
weighted average of the Pass-Through Rates of the Mortgage Loans as of the
beginning of business on the first day of the Collection Period related to such
Distribution Date (weighted on the basis of the respective Loan Balances of the
Mortgage Loans as of the beginning of business on such day).
Normal Accrual. For any Interest Accrual Period and for each Subclass,
the amount of interest accrued thereon at the applicable Certificate Rate, minus
any Civil Relief Shortfall Amount and any Unsupported Prepayment Interest
Shortfall allocated to such Subclass on the related Distribution Date.
Notices. The address of the Trustee to which notices should be sent is
the Corporate Trust Office. The address of CRMSI to which notices should be sent
is Citicorp Residential Mortgage Securities, Inc., 0000 Xxxxxxxxxx Xxxxx,
X'Xxxxxx, Xxxxxxxx 00000-0000, Attention: Office of General Counsel. The address
of the Servicer to which notices should be sent is CitiMortgage, Inc., 0000
Xxxxxxxxxx Xxxxx, X'Xxxxxx, Xxxxxxxx 00000-0000, Attention: Office of General
Counsel. The address of S&P to which notices should be sent is 00 Xxxxx Xxxxxx,
Xxx Xxxx, XX 00000. The address of Xxxxx'x to which notices should be sent is
Structured Finance Group, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. The
address of the Paying Agent and Authenticating Agent is Citibank, N.A., 000
Xxxxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attention: Agency and Trust,
CRMSI 2007-2 or any other address that the Paying Agent and Authenticating Agent
may designate from time to time by notice to the Certificateholders. The address
of the Certificate Registrar for certificate transfer purposes and for purposes
of presentation and surrender of certificates for the final distribution thereon
is Citibank, N.A., Agency and Trust, 000 Xxxx Xxxxxx, 00xx xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: 15th Floor window or any other address that the
Certificate Registrar may designate from time to time for the
Certificateholders.
OC Floor Amount. For any date, 0.50% of the Initial Pool Balance.
One-Month LIBOR. On any LIBOR Determination Date, One-Month LIBOR will
be equal to the offered rate for deposits in U.S. dollars having an index
maturity of one month for the next interest period, as such rate appears on
Telerate Page 3750, Bloomberg Page BBAM, or another page of these or any other
financial reporting service in general use in the financial services industry at
approximately 11:00 a.m., London time, on such LIBOR Determination Date, rounded
upward, if necessary, to the nearest multiple of 1/16 of 1%. If Telerate Page
3750 or Bloomberg Page BBAM is replaced by another service or ceases to exist,
the Certificate Administrator will use the replacing service or such other
service that may be nominated by the British Bankers Association for the purpose
of displaying London interbank offered rates for U.S. dollar deposits.
If no offered rate appears on Telerate Page 3750 or Bloomberg Page BBAM
on a LIBOR Determination Date at approximately 11:00 a.m., London time, then the
Certificate Administrator will select four major banks in the London interbank
market and shall request each of their principal London offices to provide a
quotation of the rate at which one-month deposits in U.S. dollars in amounts of
at least $1,000,000 are offered by it to prime banks in the London interbank
market, on that date and at that time, that is representative of single
transactions at that time. If at least two quotations are provided, One-Month
LIBOR will be the arithmetic average of the quotations provided. Otherwise, the
Certificate Administrator will select three major banks in New York City and
shall request each of them to provide a quotation of the rate offered by them at
approximately 11:00 a.m., New York City time, on the LIBOR Determination Date
for loans in U.S. dollars to leading European banks having an index maturity of
one month for the applicable Interest Accrual Period in an amount of at least
$1,000,000 that is representative of single transactions at that time. If three
quotations are provided, One-Month LIBOR will be the arithmetic average of the
quotations provided. Otherwise, the rate of One-Month LIBOR for the next
interest period will be set equal to the rate of One-Month LIBOR for the current
Interest Accrual Period.
Optional Termination Date. The first Distribution Date on which the
Right to Purchase may be exercised.
Overcollateralization Amount. For a Distribution Date, any excess of (x)
the Pool Balance as of the last day of the related Collection Period over (y)
the sum of the Class A Principal Balance and the Class M Principal Balance
(after giving effect to (i) distributions of Principal Proceeds on such
Distribution Date and (ii) and the increase of any Class M Subclass Principal
Balance as a result of Subsequent Recoveries, but prior to the payment of any
Extra Principal Distribution Amount).
Paying Agent. Citibank, N.A. shall act as the initial Paying Agent,
which appointment is hereby approved by the Trustee. The Paying Agent shall take
actions permitted or required of the Trustee under Sections 3.06, 4.01, 4.02 and
4.03 and any other actions for the Paying Agent specifically set forth in the
Pooling Agreement and, in taking such actions, the Paying Agent (and not the
Trustee) shall have all of the rights, privilege, benefits, exculpatory
provisions and protections of the Trustee as set forth in Sections 8.01, 8.02,
8.03, 8.04, 8.07, and 8.09. The Servicer may at any time appoint an additional
Paying Agent reasonably acceptable to the Trustee for any particular Class or
all Classes of the Certificates. Any such Paying Agent may be removed, and any
other Paying Agent reasonably acceptable to the Trustee appointed, by the
Servicer. For purposes of Section 4.07, the website of the Paying Agent is
located at xxx.xx.xxxxxxxxxx.xxx.
Principal Distribution Amount. For any Distribution Date, the lesser of
(x) the Certificate Balance and (y) Principal Proceeds plus any Extra Principal
Distribution Amount minus any Release Amount.
Private Certificates. The Class CE Certificates and the Class R
Certificate.
Prospectus. The prospectus dated June 26, 2007 relating to the Class A
Certificates and the Class M Certificates.
Rating Agencies. The Rating Agencies are S&P and Xxxxx'x.
Record Date. The Record Date for each Distribution Date will be (x) for
all Certificates other than the Class A-1b Certificates, the close of business
on the last day of the month preceding the month of the applicable Distribution
Date, and (y) for the Class A-1b Certificates, the day immediately preceding
such Distribution Date.
Release Amount. For a Distribution Date on or after the Stepdown Date,
the lesser of (x) Principal Proceeds and (y) the excess of the
Overcollateralization Amount over the greater of (a) the Targeted Level and (b)
the OC Floor Amount; provided that if on such Distribution Date a Trigger Event
is in effect, the Release Amount is zero.
Required Class A Enhancement Level. For any date, 28.90%.
Right to Purchase. The right of the Servicer to purchase all of the
Mortgage Loans pursuant to Section 9.01 shall be conditioned upon, among other
things, the Current Pool Balance being less than 10% of the Initial Pool Balance
at the time of any such repurchase.
Rolling Sixty-Day Delinquency Rate. For any Distribution Date on or
after the Stepdown Date, the average of the Sixty-Day Delinquency Rates for such
Distribution Date and the two immediately preceding Distribution Dates.
Section 3.19 Applicability. Section 3.19 is not applicable to the Series
2007-2 Certificates.
Senior Principal Distribution Amount. For any Distribution Date prior to
the Stepdown Date or on which a Trigger Event is in effect, the Principal
Distribution Amount for such Distribution Date; for all other Distribution
Dates, the lesser of (x) the Principal Distribution Amount and (y) the Class A
Principal Balance minus the lesser of (A) the Pool Balance minus the OC Floor
Amount and (B) 71.10% of the Pool Balance.
Servicing Fee. The Servicing Fee is a monthly fee equal, for each
Collection Period, to the sum of Daily Servicing Fee Accrual Amounts for each
Mortgage Loan for each day during such Collection Period, payable to the
Servicer out of each payment received by it on account of interest on such
Mortgage Loan during such Collection Period.
Servicing Fee Rate. 0.50% per annum.
Sixty-Day Delinquency Rate. For any Distribution Date, the percentage
equivalent of a fraction, the numerator of which equals the aggregate Loan
Balances Delinquent more than 60 days (without regard to any grace period and
including, for this purpose, Mortgage Loans in foreclosure or subject to
Mortgagor bankruptcy proceedings and REO Properties) as of the last day of the
related Collection Period, and the denominator of which equals the Pool Balance
as of the last day of that Collection Period.
Startup Day. The Startup Day will be the Issue Date.
Stepdown Date. The earlier to occur of (a) the first Distribution Date
on or prior to which the Class A Principal Balance has been reduced to zero and
(b) the later to occur of (x) the Distribution Date in July 2010 and (y) the
Enhancement Date.
Subordinated Certificates. The Class M Certificates.
Subordination Depletion Date. The first Distribution Date on which the
Principal Balance of the Subordinated Certificates has been reduced to zero.
Targeted Level. On any Distribution Date, (a) prior to the Stepdown
Date, 3.05% of the Initial Pool Balance and (b) on any other Distribution Date,
the greater of (i) 6.10% of the Pool Balance and (ii) the OC Floor Amount.
However, in the event that a Trigger Event is in effect on a particular
Distribution Date, the Targeted Level for such Distribution Date shall not be
less than the Targeted Level on the preceding Distribution Date.
Trigger Event. A Trigger Event will be in effect on a Distribution Date
if either the Delinquency Test or the Cumulative Loss Test is failed.
Trust. The Trust created by this Agreement, which shall be named the
Citicorp Residential Mortgage Trust Series 2007-2.
Upper-Tier REMIC. The designated portion of the Trust Fund consisting of
the Lower-Tier REMIC Regular Interests and proceeds thereof.
Upper-Tier REMIC Regular Interests. As defined in Section 12.04.
Voting Interest. As of any date, the Voting Interest of the Class A
Certificates shall equal 100% multiplied by a fraction the numerator of which is
the Class A Principal Balance and the denominator of which is the sum of the
Class A Principal Balance and the Class M Principal Balance. As of any date the
Voting Interest of the Class M Certificates will equal 100% minus the Class A
Voting Interest. The Voting Interest of the Class A Certificates and the Class M
Certificates will be allocated among the Subclasses of the Class A or Class M
Certificates, as the case may be, pro rata based on each such Subclass'
Principal Balance.
WAC Accrual. For any Interest Accrual Period and for each Subclass, the
amount of interest accrued thereon at the Net WAC Rate.
Section 12.03. Wire Transfer Eligibility.
The minimum Initial Principal Balance for wire transfer on each
Distribution Date, in the case of Certificates (other than the Class CE and
Class R Certificates), is $1,000,000 and, in the case of each of the Class CE
Certificates and Class R Certificate, a 100% Percentage Interest.
Section 12.04. REMIC-Related Provisions.
(a) CRMSI and the Trustee will perform their respective duties in a
manner consistent with the REMIC provisions of the Code and will not knowingly
take or fail to take any action that would adversely affect the continuing
treatment of the Trust Fund as a segregated asset pool, and the treatment of
such segregated asset pool as two REMICs and to avoid the imposition of a tax on
the Trust Fund or either REMIC, and to carry out the covenants set forth in this
Article XII and the elections and reporting required in Section 8.11 on behalf
of the Upper-Tier REMIC and the Lower-Tier REMIC, including making the
appropriate elections to treat each such segregated asset pool as a REMIC and
maintaining a segregated account (the "Certificate Account"). The rights to the
Cap Amounts shall be accounted for as notional principal contracts (provided by
the holder of the Class CE Certificates and funded from amounts that would
otherwise be distributable thereon) and as assets of a grantor trust for federal
income tax purposes, and not as assets of either REMIC. CRMSI shall furnish or
cause to be furnished annually to the holders of the related Certificates
information regarding their allocable share of the income with respect to such
grantor trust and shall file or cause to be filed with the Internal Revenue
Service Form 1041 (together with any necessary attachments) or such other
applicable form.
Lower-Tier REMIC
The Lower-Tier REMIC shall issue the interests designated in the table
below and the Class LT-R Interest, and each such interest, other than the Class
LT-R Interest, is hereby designated as a regular interest in the Lower-Tier
REMIC ("Lower-Tier REMIC Regular Interest"). The Class LT-R Interest is hereby
designated as the sole class of residual interest in the Lower-Tier REMIC and
shall be represented by the Class R Certificate.
Corresponding
Corresponding Lower-Tier REMIC Lower-Tier REMIC Lower-Tier REMIC Upper-Tier REMIC
Regular Interest Interest Rate Principal Amount Regular Interest
-------------------------------- ---------------- ------------------------------------------------ ----------------
Class LT-A-1a (1) 1/2 initial Certificate Balance of A-1a
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-A-1b (1) 1/2 initial Certificate Balance of A-1b
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-A-2 (1) 1/2 initial Certificate Balance of A-2
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-A-3 (1) 1/2 initial Certificate Balance of A-3
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-A-4 (1) 1/2 initial Certificate Balance of A-4
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-A-5 (1) 1/2 initial Certificate Balance of A-5
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-A-6 (1) 1/2 initial Certificate Balance of A-6
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-1 (1) 1/2 initial Certificate Balance of M-1
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-2 (1) 1/2 initial Certificate Balance of M-2
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-3 (1) 1/2 initial Certificate Balance of M-3
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-4 (1) 1/2 initial Certificate Balance of M-4
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-5 (1) 1/2 initial Certificate Balance of M-5
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-6 (1) 1/2 initial Certificate Balance of M-6
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-7 (1) 1/2 initial Certificate Balance of M-7
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-8 (1) 1/2 initial Certificate Balance of M-8
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-M-9 (1) 1/2 initial Certificate Balance of M-9
Corresponding Upper-Tier REMIC Regular
Interest
Class LT-Accrual (1) 1/2 Pool Balance plus 1/2 Overcollateralization N/A
Amount
-----------------------------
(1) The interest rate with respect to any Distribution Date for these
interests is a per annum variable rate equal to the Net WAC Rate.
Each Lower-Tier REMIC Regular Interest is hereby designated as a regular
interest in the Lower-Tier REMIC. The Class LT-A-1a, Class LT-A-1b, Class
LT-A-2, Class LT-A-3, Class LT-A-4, Class LT-A-5, Class LT-A-6, Class LT-M-1,
Class LT-M-2, Class LT-M-3, Class LT-M-4, Class LT-M-5, Class LT-M-6, Class
LT-M-7, Class LT-M-8 and Class LT-M-9 Interests are hereby designated the LT
Accretion Directed Classes (the "LT Accretion Directed Classes").
On each Distribution Date, 50% of the increase in the
Overcollateralization Amount shall be payable as a reduction of the Lower-Tier
REMIC Principal Amount of the LT Accretion Directed Classes (each such Class
will be reduced by an amount equal to 50% of any increase in the
Overcollateralization Amount that is attributable to a reduction in the
Certificate Balance of its Corresponding Class) and shall be accrued and added
to the Lower-Tier REMIC Principal Amount of the Class LT-Accrual Interest. On
each Distribution Date, the increase in the Lower-Tier REMIC Principal Amount of
the Class LT-Accrual Interest shall not exceed interest accruals for such
Distribution Date for the Class LT-Accrual Interest. In the event that: (i) 50%
of the increase in the Overcollateralization Amount exceeds (ii) interest
accruals on the Class LT-Accrual Interest for such Distribution Date, the excess
for such Distribution Date (accumulated with all such excesses for all prior
Distribution Dates) will be added to any increase in the Overcollateralization
Amount for purposes of determining the amount of interest accrual on the Class
LT-Accrual Interest payable as principal on the LT Accretion Directed Classes on
the next Distribution Date pursuant to the first sentence of this paragraph. All
payments of scheduled principal and prepayments of principal generated by the
Mortgage Loans and all Subsequent Recoveries allocable to principal shall be
allocated (i) 50% to the Class LT-Accrual Interest and (ii) 50% to the LT
Accretion Directed Classes (such principal payments and Subsequent Recoveries
shall be allocated among such LT Accretion Directed Classes in an amount equal
to 50% of the principal amounts and Subsequent Recoveries allocated to their
respective Corresponding Classes), until paid in full. Notwithstanding the
above, principal payments allocated to the Class CE Interest that result in the
reduction in the Overcollateralization Amount shall be allocated to the Class
LT-Accrual Interest (until paid in full). Realized Losses shall be applied so
that after all distributions have been made on each Distribution Date (i) the
Lower-Tier REMIC Principal Amount of each of the LT Accretion Directed Classes
is equal to 50% of the Certificate Balance of their Corresponding Class, and
(ii) the Class LT-Accrual Interest is equal to 50% of the aggregate Stated
Principal Balance of the Mortgage Loans plus 50% of the Overcollateralization
Amount. Any increase in the Certificate Balance of a Class of Certificates as a
result of a Subsequent Recovery shall increase the Lower-Tier REMIC Principal
Amount of the Corresponding Lower-Tier REMIC Regular Interest by 50% of such
increase, and the remaining 50% of such increase shall increase the Lower-Tier
REMIC Principal Amount of the Class LT-Accrual Interest.
Upper-Tier REMIC
The Upper-Tier REMIC shall issue the interests designated in the table
below and the Class UT-R Interest, and each such interest, other than the Class
UT-R Interest, is hereby designated as a regular interest in the Upper-Tier
REMIC ("Upper-Tier REMIC Regular Interest"). The Class UT-R Interest is hereby
designated as the sole class of residual interests in the Upper-Tier REMIC and
shall be represented by the Class R Certificate.
Upper-Tier REMIC Regular Upper-Tier REMIC Initial Upper-Tier REMIC Corresponding Class of
Interest Interest Rate Principal Amount Certificates
-------------------------------- ---------------- ------------------------ ----------------------
Class A-1a (1) $62,000,000.00 Class A-1a
Class A-1b (1) $244,354,000.00 Class A-1b
Class A-2 (1) $104,317,000.00 Class A-2
Class A-3 (1) $86,611,000.00 Class A-3
Class A-4 (1) $117,958,000.00 Class A-4
Class A-5 (1) $49,274,000.00 Class A-5
Class A-6 (1) $73,835,000.00 Class A-6
Class M-1 (1) $20,714,000.00 Class M-1
Class M-2 (1) $18,124,000.00 Class M-2
Class M-3 (1) $11,220,000.00 Class M-3
Class M-4 (1) $10,357,000.00 Class M-4
Class M-5 (1) $9,493,000.00 Class M-5
Class M-6 (1) $8,631,000.00 Class M-6
Class M-7 (1) $6,905,000.00 Class M-7
Class M-8 (1) $4,315,000.00 Class M-8
Class M-9 (1) $8,631,000.00 Class M-9
Class CE (2) (2) N/A
-----------------
(1) For any Distribution Date (and the related Interest Accrual Period),
this interest shall bear interest at the lesser of (i) the Certificate
Rate (determined without regard to the Net WAC Rate) for the
Corresponding Class of Certificates and (ii) the Net WAC Rate.
(2) The Class CE Interest has an initial principal balance of $26,323,412.17
but will not accrue interest on such balance but will accrue interest on
a notional principal balance. As of any Distribution Date, the Class CE
Interest shall have a notional principal balance equal to the aggregate
of the Lower-Tier REMIC Principal Amounts of the Lower-Tier REMIC
Regular Interests as of the first day of the related Interest Accrual
Period. With respect to any Interest Accrual Period, the Class CE
Interest shall bear interest at a rate equal to the excess, if any, of
the Net WAC Rate over the product of (i) 2 and (ii) the weighted average
of the Lower-Tier REMIC Interest Rates of the Lower-Tier REMIC Regular
Interests, where the Lower-Tier REMIC Interest Rate on the Class
LT-Accrual Interest is subject to a cap equal to zero and each LT
Accretion Directed Class is subject to a cap equal to the Upper-Tier
REMIC Interest Rate on its Corresponding Class of Upper-Tier REMIC
Regular Interest. With respect to any Distribution Date, interest that
so accrues on the notional principal balance of the Class CE Interest
shall be deferred in an amount equal to any increase in the
Overcollateralization Amount on such Distribution Date. Such deferred
interest shall not itself bear interest.
On each Distribution Date, interest distributable in respect of the
Lower-Tier REMIC Regular Interests for such Distribution Date shall be deemed to
be distributed on the interests in the Upper-Tier REMIC at the rates shown
above.
On each Distribution Date, all Realized Losses, Subsequent Recoveries
and all payments of principal shall be allocated to the Upper-Tier REMIC Regular
Interests until the outstanding principal balance of each such interest equals
the outstanding Class A Subclass Principal Balance or Class M Subclass Principal
Balance of the Corresponding Class of Certificates as of such Distribution Date.
(b) CRMSI, on behalf of the Trustee, shall deposit in the Collection
Account in accordance with Section 3.06 all Scheduled Payments received by it,
all other deposits required to be made to the Collection Account and all
investments made with moneys on deposit in the Collection Account, including all
income or gain from such investments, if any. If the Certificate Account is an
Investment Account, then funds on deposit in the Certificate Account shall be
held and invested in accordance with the applicable provisions of Section 4.03.
Distributions from the Certificate Account shall be made in accordance with the
provisions of Articles XII and XIII to make payments in respect of the
Certificates and to pay the Servicing Fee in accordance with Section 3.13.
Amounts distributable as Cap Amounts to the related Certificates pursuant to
Section 13.01(b) shall first be deemed distributed in respect of the Class CE
Interest and then paid outside of the Upper-Tier REMIC to the related
Certificates.
The Servicer shall maintain books with respect to the Upper-Tier REMIC
and the Lower-Tier REMIC on a calendar year taxable year and on the accrual
method of accounting.
(c) None of the Servicer, the Certificate Administrator, the Paying
Agent, the Certificate Registrar or the Trustee shall create, or permit the
creation of, any "interests" in either REMIC within the meaning of Code Section
860D(a)(2) other than the interests represented by the Certificates.
(d) Except as otherwise provided in the Code, CRMSI shall not grant, and
none of the Servicer, the Certificate Administrator, the Paying Agent, the
Certificate Registrar or the Trustee shall accept, property unless (i)
substantially all of the property held by either REMIC constitutes either
"qualified mortgages" or "permitted investments" as defined in Code Sections
860G(a)(3) and (5), respectively, and (ii) no property shall be granted to
either REMIC after the Startup Day, unless such grant would not subject the
REMIC to the 100% tax on contributions to a REMIC after the Startup Day imposed
by Code Section 860G(d).
(e) None of the Servicer, the Certificate Administrator, the Paying
Agent, the Certificate Registrar or the Trustee shall accept on behalf of the
Trust Fund or the Upper-Tier REMIC or the Lower-Tier REMIC any fee or other
compensation for services and shall not accept on behalf of the Trust Fund any
income from assets other than those permitted to be held by a REMIC.
(f) None of the Servicer, the Certificate Administrator, the Paying
Agent or the Trustee shall sell or permit the sale of all or any portion of the
Mortgage Loans, or of an Eligible Investment held in an Investment Account
(other than in accordance with Sections 2.02, 2.03, 2.04 and 4.03(d)) unless
such sale is pursuant to a "qualified liquidation" as defined in Code Section
860F(a)(4)(A) and is in accordance with Section 9.01.
Section 12.05. Expenses and Liabilities of the Trust Fund.
To the extent not otherwise payable pursuant to another provision of
this Agreement, the Depositor shall be liable for all expenses, liabilities and
obligations of the Trust Fund (other than the obligation to make distributions
in reduction of Principal Balance of the Certificates and the obligation to make
distributions of interest on the Certificates). To the extent such expenses,
liabilities or obligations consist of federal income taxes, including, without
limitation, prohibited transaction taxes, taxes on net income from foreclosure
property and taxes on certain contributions to a REMIC after the Startup Day,
nothing shall prevent the Depositor from contesting any such tax, if permitted
by law, pending the outcome of such proceedings. If the Paying Agent determines
that on any Distribution Date the amount in the Collection Account, after the
distribution of all amounts required to be distributed to the Holders of the
Certificates has been made, is insufficient to pay expenses or meet any
obligations of the Trust Fund that are not otherwise payable pursuant to another
provision of this Agreement, the Paying Agent shall give notice of any shortfall
to the Depositor setting forth the basis for such determination and, within ten
Business Days of such notice, the Depositor shall deliver to the Paying Agent
immediately available funds in the amount of such expenses.
Section 12.06. Tax Matters Person.
If in any taxable year there will be more than one holder of Class R
Certificate, a tax matters person may be designated with respect to the REMIC,
who will have the same duties with respect to the Upper-Tier REMIC and the
Lower-Tier REMIC as those of a "tax matters partner" under Subchapter C of
Chapter 63 of Subtitle F of the Code, and who will be, in order of priority, (i)
the Servicer or an affiliate of the Servicer, if the Servicer or such affiliate
is the holder of a residual certificate of the Upper-Tier REMIC or the
Lower-Tier REMIC at any time during the taxable year or at the time such
designation is made, (ii) if the Servicer is not a holder of a residual
certificate of the Upper-Tier REMIC or the Lower-Tier REMIC at the relevant
time, the Servicer as agent for the holder of the residual certificate of the
Upper-Tier REMIC or the Lower-Tier REMIC, if such designation is permitted to be
made under the Code, or (iii) such holder of a residual certificate of the
Upper-Tier REMIC or the Lower-Tier REMIC or person who may be designated a tax
matters person in the same manner in which a tax matters partner may be
designated under applicable Treasury Regulations, including Treasury Regulations
xx.xx. 1.860F-4(d) and 301.6231(a)(7)-1.
Section 12.07. [Reserved]
ARTICLE XIII
SUBORDINATION; PRIORITIES; ALLOCATION OF LOSSES
Section 13.01.Subordination; Priority of Distributions.
(a) The rights of the holders of any Subclass of Class M Certificates to
receive distributions in respect thereof on any Distribution Date shall be
subordinated to the rights of the Class A Certificateholders and the holders of
each Class M Subclass having a lower numerical designation to receive
distributions to the extent, and only to the extent, described herein. The right
of the Servicer to receive its Servicing Fee and its Additional Servicing
Compensation shall not be subordinated to the rights of Certificateholders.
(b) On each Distribution Date, the aggregate amount of Interest Proceeds
and Principal Proceeds will be applied in the following amounts, to the extent
the amount thereof is sufficient therefor, in the manner and in the order of
priority as follows:
1. The sum of Interest Proceeds and Principal Proceeds (in each case,
excluding all permitted withdrawals from the Collection Account pursuant to
Section 3.06(d)) will be applied sequentially, as follows:
a. concurrently, to the Subclasses of Class A Certificates, pro
rata, their respective Class A Subclass Interest Amounts and any Class A
Subclass Interest Shortfalls for such Distribution Date;
b. sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates, in that order, their respective Class M Subclass Interest
Amounts for such Distribution Date;
c. to the Subclasses of Class A Certificates, the amounts
provided in Section 12.01(d) or (e), as applicable;
d. sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates, in that order, in each case until their respective
Principal Balance is reduced to zero, an amount equal to their Class M
Subclass Principal Distribution Amount;
e. sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates, in that order, an amount equal to any Class M Subclass
Interest Shortfall for such Class for such Distribution Date or
previously allocated thereto, and then, sequentially, in that order, an
amount equal to any Applied Loss Amount allocated to such Class pursuant
to Section 13.02 on such Distribution Date plus any Class M Subclass
Loss Amount for such Class;
f. first, concurrently to the Class A Certificates, pro rata, any
Net Civil Relief Amounts and Net Non-Supported Amounts for such
Subclasses, and then, sequentially, to the Class X-0, Xxxxx X-0, Class
M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8 and Class M-9
Certificates, in that order, any Net Civil Relief Amounts and Net
Non-Supported Amounts for such Class;
g. first, concurrently to the Class A Certificates, pro rata, any
Net Class A WAC Cap Amounts for such Subclasses, and then, sequentially,
to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6,
Class M-7, Class M-8 and Class M-9 Certificates, in that order, any Net
Class M WAC Cap Amounts for such Class;
h. to the Holder of the Class CE Certificates, the Class CE
Distributable Amount; and
i. to the Holder of the Class R Certificate, any remaining
amount.
2. It is the intention of the parties hereto that the portion of the
Trust Fund, exclusive of the Lower-Tier REMIC and Upper-Tier REMIC, be treated
as a grantor trust for purposes of Subpart E, Part I of Subchapter J of the
Code. In furtherance of such intention, neither the Servicer nor the Trustee
shall vary the investment of the Certificateholders in the grantor trust. Solely
for REMIC purposes, any amounts distributed pursuant to Section 13.01(b)(1)(g)
shall be deemed distributed to the Class CE Certificates in respect of the Class
CE Interest from the Upper-Tier REMIC and then deemed paid to the classes of
Certificates as described in Section 13.01(b)(1)(g) from the grantor trust.
Section 13.02.Allocation of Realized Losses; Recoveries.
(a) For any Distribution Date prior to the Subordination Depletion Date,
any Applied Loss Amount will be allocated to the Subclasses of Class M
Certificates, first to the Class M Subclass with the highest numerical
designation and then in order of decreasing numerical designation, until their
respective Class M Subclass Principal Balance has been reduced to zero.
This allocation of Applied Loss Amounts will be effected through the
reduction of the applicable Subclass Principal Balance. Any Applied Loss Amount
allocated in accordance with this Section 13.02 will be allocated on the
Distribution Date following the Collection Period in which such loss was
incurred and after giving effect to distributions made under Section 13.01 on
such Distribution Date.
(b) Any Applied Loss Amount allocated to a Subclass of Class M
Certificates pursuant to Section 13.02(a) shall be allocated among the
Certificates of such Subclass pro rata based on their respective Principal
Balances.
(c) In the event that Net Subsequent Recoveries are received by the
Servicer during a Prepayment Collection Period, immediately prior to the
Distribution Date to which such Prepayment Collection Period relates, an amount
equal to the amount of such Net Subsequent Recoveries shall be added to the
outstanding Class M Subclass Principal Balances of the Class M Subclasses, in
order of increasing numerical designation, but only if and to the extent that
the Class M Subclass had theretofore been allocated any Applied Loss Amount.
(d) No Civil Relief Shortfall Amount, Net Civil Relief Amount,
Unsupported Prepayment Interest Shortfall or Net Non-Supported Amount will
accrue interest.
Section 13.03. [Reserved]
Section 13.04. Distributions on the Class R Certificate.
Upon a termination of the Trust in accordance with Section 9.01, the
Class R Certificate shall receive all amounts remaining in the Certificate
Account after all required distributions on the Class A, Class M and Class CE
Certificates have been made and after all required payments and reimbursements
of fees and expenses have been made or provided for.
ARTICLE XIV
ADDITIONAL PROVISIONS
Section 14.01. Additional Representations and Warranties.
CRMSI hereby represents and warrants to the Trustee, in addition to
Section 2.03(a) and with the same force and effect for all purposes of this
Agreement as though these representations and warranties were set forth in
Section 2.03(a), as follows:
(i) As of the Cut-Off Date, no principal or interest on a Mortgage
Loan was more than 30 days Delinquent; and
(ii) All original executed Mortgage Notes have been or will be
delivered to the Mortgage Note Custodian.
Section 14.02. Additional Servicing Events of Default.
Not applicable.
Section 14.03. Additional Conditions for Subsequent Transfer Dates.
Not applicable.
Section 14.04. Additional Certificate Information.
Not applicable.
Section 14.05. Additional Pool Information.
Not applicable.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
CITICORP RESIDENTIAL MORTGAGE
SECURITIES, INC., as Depositor
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION, as
Trustee
By: /s/ Xxxxxxxxx Xxxxxx
-------------------------------------
Name: Xxxxxxxxx Xxxxxx
Title: Assistant Vice President
CITIMORTGAGE, INC., as Servicer and
Certificate Administrator
By: /s/ Xxxx Xxxx
-------------------------------------
Name: Xxxx Xxxx
Title: Chief Financial Officer
CITIBANK, N.A., as Paying Agent,
Certificate Registrar and Authenticating
Agent
By: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Assistant Vice President
State of Missouri )
) ss.:
County of St. Xxxxxxx )
On the 28th day of June 2007 before me, a notary public in and
for the State of Missouri, personally appeared Xxxxxx X. Xxxxxxx known to me
who, being by me duly sworn, did depose and say that he is a Vice President of
Citicorp Residential Mortgage Securities, Inc., a Delaware corporation, one of
the parties that executed the foregoing instrument; that she signed her name to
said instrument and that she has been authorized by Citicorp Residential
Mortgage Securities, Inc. to execute said instrument.
----------------------------------
Notary Public
[Notarial Seal]
State of Massachusetts )
) ss.:
County of _________ )
On the 28th day of June 2007 before me, a notary public in and
for the State of Massachusetts, personally appeared Xxxxxxxxx Xxxxxx known to me
who, being by me duly sworn, did depose and say that she is an Assistant Vice
President of U.S. Bank National Association, a national banking association, one
of the parties that executed the foregoing instrument; that she signed her name
to said instrument and that she has been authorized by U.S. Bank National
Association to execute said instrument.
----------------------------------
Notary Public
[Notarial Seal]
State of Missouri )
) ss.:
County of St. Xxxxxxx )
On the 28th day of June 2007 before me, a notary public in and
for the State of Missouri, personally appeared Xxxx Xxxx known to me who, being
by me duly sworn, did depose and say that he is a Chief Financial Officer of
CitiMortgage, Inc., a New York corporation, one of the parties that executed the
foregoing instrument; that he signed his name to said instrument and that he has
been authorized by CitiMortgage, Inc. to execute said instrument.
----------------------------------
Notary Public
[Notarial Seal]
State of New York )
) ss.:
County of New York )
On the 28th day of June 2007 before me, a notary public in and
for the State of New York, personally appeared Xxxxx Xxxxx known to me who,
being by me duly sworn, did depose and say that she is an Assistant Vice
President of Citibank, N.A., a national banking association, one of the parties
that executed the foregoing instrument; that he signed his name to said
instrument and that he has been authorized by Citibank, N.A. to execute said
instrument.
----------------------------------
Notary Public
[Notarial Seal]
SCHEDULE 1
SERVICING CRITERIA TO BE ADDRESSED IN REPORT ON ASSESSMENT OF COMPLIANCE
Regulation Responsible
AB reference Servicing criteria Person
----------------------------------------------------------------------------------------------------------------
General servicing considerations
1122(d)(1)(i) Policies and procedures are instituted to monitor any performance Servicer
or other triggers and events of default in accordance with the
transaction agreements.
1122(d)(1)(ii) If any material servicing activities are outsourced to third Servicer
parties, policies and procedures are instituted to monitor the
third party's performance and compliance with such servicing
activities.
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in effect on the Servicer
party participating in the servicing function throughout the
reporting period in the amount of coverage required by and
otherwise in accordance with the terms of the transaction
agreements.
Cash collection and administration
1122(d)(2)(i) Payments on pool assets are deposited into the appropriate Servicer
custodial bank accounts and related bank clearing accounts no more
than two business days following receipt, or such other number of
days specified in the transaction agreements.
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an obligor or to Servicer,
an investor are made only by authorized personnel. Paying Agent
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash flows
or distributions, and any interest or other fees charged for such Servicer
advances, are made, reviewed and approved as specified in the
transaction agreements.
1122(d)(2)(iv) The related accounts for the transaction, such as cash reserve Servicer,
accounts or accounts established as a form of over Paying Agent
collateralization, are separately maintained (e.g., with respect to
commingling of cash) as set forth in the transaction agreements.
1122(d)(2)(v) Each custodial account is maintained at a federally insured Servicer,
depository institution as set forth in the transaction agreements. Paying Agent
For purposes of this criterion, "federally insured depository
institution" with respect to a foreign financial institution means
a foreign financial institution that meets the requirements of Rule
13k-1(b)(1) of the Securities Exchange Act.
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized Servicer,
access. Paying Agent
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all
asset-backed securities related bank accounts, including custodial Servicer,
accounts and related bank clearing accounts. These reconciliations Certificate
are (A) mathematically accurate; (B) prepared within 30 calendar Administrator,
days after the bank statement cutoff date, or such other number of Paying Agent
days specified in the transaction agreements; (C) reviewed and
approved by someone other than the person who prepared the
reconciliation; and (D) contain explanations for reconciling
items. These reconciling items are resolved within 90 calendar
days of their original identification, or such other number of days
specified in the transaction agreements.
Investor remittances and reporting
1122(d)(3)(i) Reports to investors, including those to be filed with the Servicer,
Commission, are maintained in accordance with the transaction Certificate
agreements and applicable Commission requirements. Specifically, Administrator
such reports (A) are prepared in accordance with timeframes and
other terms set forth in the transaction agreements; (B) provide
information calculated in accordance with the terms specified in
the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with
investors' or the trustee's records as to the total unpaid
principal balance and number of Pool Assets serviced by the
Servicer.
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in accordance Servicer,
with timeframes, distribution priority and other terms set forth in Certificate
the transaction agreements. Administrator,
Paying Agent
1122(d)(3)(iii) Disbursements made to an investor are posted within two business
days to the Servicer's investor records, or such other number of Servicer,
days specified in the transaction agreements. Certificate
Administrator,
Paying Agent
1122(d)(3)(iv) Amounts remitted to investors per the investor reports agree with
cancelled checks, or other form of payment, or custodial bank Certificate
statements. Administrator,
Paying Agent
Pool asset administration
1122(d)(4)(i) Collateral or security on pool assets is maintained as required by Servicer,
the transaction agreements or related pool asset documents. Mortgage Note
Custodian
1122(d)(4)(ii) Pool assets and related documents are safeguarded as required by
the transaction agreements. Custodian
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool are
made, reviewed and approved in accordance with any conditions or Servicer
requirements in the transaction agreements.
1122(d)(4)(iv) Payments on pool assets, including any payoffs, made in accordance Servicer
with the related pool asset documents are posted to the Servicer's
obligor records maintained no more than two business days after
receipt, or such other number of days specified in the transaction
agreements, and allocated to principal, interest or other items
(e.g., escrow) in accordance with the related pool asset documents.
1122(d)(4)(v) The Servicer's records regarding the pool assets agree with the Servicer
Servicer's records with respect to an obligor's unpaid principal
balance.
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's pool Servicer
assets (e.g., loan modifications or re-agings) are made, reviewed
and approved by authorized personnel in accordance with the
transaction agreements and related pool asset documents.
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forebearance plans, Servicer
modifications and deeds in lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated, conducted and
concluded in accordance with the timeframes or other requirement
established by the transaction agreements.
1122(d)(4)(viii) Records documenting collection efforts are maintained during the Servicer
period a pool asset is delinquent in accordance with the
transaction agreements. Such records are maintained on at least a
monthly basis, or such other period specified in the transaction
agreements, and describe the entity's activities in monitoring
delinquent pool assets including, for example, phone calls, letters
and payment rescheduling plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
1122(d)(4)(ix) Adjustments to interest rates or rates of return for pool assets Servicer
with variable rates are computed based on the related pool asset
documents.
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as escrow Servicer
accounts): (A) such funds are analyzed, in accordance with the
obligor's pool asset documents, on at least an annual basis, or
such other period specified in the transaction agreements; (B)
interest on such funds is paid, or credited, to obligors in
accordance with applicable pool asset documents and state laws; and
(C) such funds are returned to the obligor within 30 calendar days
of full repayment of related pool assets, or such other number of
days specified in the transaction agreements.
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or insurance Servicer
payments) are made on or before the related penalty or expiration
dates, as indicated on the appropriate bills or notices for such
payments, provided that such support has been received by the
servicer at least 30 calendar days prior to these dates, or such
other number of days specified in the transaction agreements.
1122(d)(4)(xii) Any late payment penalties in connection with any payment to be Servicer
made on behalf of an obligor are paid from the Servicer's funds and
not charged to the obligor, unless the late payment was due to the
obligor's error or omission.
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted within two Servicer
business days to the obligor's records maintained by the servicer,
or such other number of days specified in the transaction
agreements.
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are Servicer
recognized and recorded in accordance with the transaction
agreements.
1122(d)(4)(xv) Any external enhancement or other support, identified in Item Servicer
1114(a)(1) through (3) or Item 1115 of Regulation AB, is maintained
as set forth in the transaction agreements.
SCHEDULE 2
Additional Form 10-D Disclosure
----------------------------------------------------------------------------------------------------------------
Item on Form 10-D Party Responsible
----------------------------------------------------------------------------------------------------------------
Item 1: Distribution and Pool Performance Information Servicer, Certificate Administrator
Any information required by 1121 which is NOT
included on the Distribution Date Statement
----------------------------------------------------------------------------------------------------------------
Item 2: Legal Proceedings per Item 1117 of Reg AB (i) All parties to the Pooling and Servicing
Agreement and the Mortgage Note Custodian as to
themselves, (ii) the Servicer as to the issuing
entity, (iii) the Depositor as to the sponsor,
any 1110(b) originator, any 1100(d)(1) party
----------------------------------------------------------------------------------------------------------------
Item 3: Sale of Securities and Use of Proceeds Depositor
----------------------------------------------------------------------------------------------------------------
Item 4: Defaults Upon Senior Securities Servicer, Certificate Administrator
----------------------------------------------------------------------------------------------------------------
Item 5: Submission of Matters to a Vote of Security Servicer, Certificate Administrator, Trustee,
Holders Paying Agent, Authenticating Agent, Certificate
Registrar (in each case, if such party is
responsible for submission of such vote to
Holders)
----------------------------------------------------------------------------------------------------------------
Item 6: Significant Obligors of Pool Assets Depositor, if applicable
----------------------------------------------------------------------------------------------------------------
Item 7: Significant Enhancement Provider Information Depositor, if applicable
----------------------------------------------------------------------------------------------------------------
Item 8: Other Information Any party responsible for the applicable
disclosure items on Form 8-K to the extent not
previously filed on a Form 8-K
----------------------------------------------------------------------------------------------------------------
Item 9: Exhibits Depositor, Servicer, Certificate Administrator
----------------------------------------------------------------------------------------------------------------
SCHEDULE 3
Additional Form 10-K Disclosure
----------------------------------------------------------------------------------------------------------------
Item on Form 10-K Party Responsible
----------------------------------------------------------------------------------------------------------------
Item 1B: Unresolved Staff Comments Depositor
----------------------------------------------------------------------------------------------------------------
Item 9B: Other Information Any party responsible for the applicable
disclosure items on Form 8-K to the extent not
previously filed on a Form 8-K
----------------------------------------------------------------------------------------------------------------
Item 15: Exhibits, Financial Statement Schedules Servicer, Certificate Administrator,
Depositor
----------------------------------------------------------------------------------------------------------------
Additional Item: (i) All parties to the Pooling and Servicing
Agreement and the Mortgage Note Custodian as
to themselves, (ii) the Servicer as to the
issuing entity, (iii) the Depositor as to the
sponsor, any 1110(b) originator, any
1100(d)(1) party
----------------------------------------------------------------------------------------------------------------
Disclosure per Item 1117 of Reg AB
----------------------------------------------------------------------------------------------------------------
Additional Item: (i) All parties to the Pooling and Servicing
Disclosure per Item 1119 of Reg AB Agreement and the Mortgage Note Custodian as
to themselves, (ii) the Servicer as to the
issuing entity, (iii) the Depositor as to the
sponsor, any 1110(b) originator, any
1100(d)(1) party, any significant obligor, any
credit enhancement provider or derivative
counterparty
----------------------------------------------------------------------------------------------------------------
Additional Item: Depositor, if applicable
----------------------------------------------------------------------------------------------------------------
Disclosure per Item 1112(b) of Reg AB
----------------------------------------------------------------------------------------------------------------
Additional Item: Depositor, if applicable
----------------------------------------------------------------------------------------------------------------
Disclosure per Items 1114(b) and 1115(b) of Reg AB
----------------------------------------------------------------------------------------------------------------
SCHEDULE 4
Form 8-K Disclosure Information
----------------------------------------------------------------------------------------------------------------
Item on Form 8-K Party Responsible
----------------------------------------------------------------------------------------------------------------
Item 1.01- Entry into a Material Definitive Agreement All parties to the Pooling and Servicing
Agreement and the Mortgage Note Custodian
entering into such material definitive
agreement (provided, however, that with
respect to the Paying Agent, the Certificate
Registrar and the Authenticating Agent, no
such disclosure shall be required for any
agreement to which the Servicer, the
Certificate Administrator, the Depositor or
the Mortgage Note Custodian is a party)
----------------------------------------------------------------------------------------------------------------
Item 1.02- Termination of a Material Definitive Agreement All parties to the Pooling and Servicing
Agreement and the Mortgage Note Custodian
terminating such material definitive agreement
(provided, however, that with respect to the
Paying Agent, the Certificate Registrar and
the Authenticating Agent, no such disclosure
shall be required for any agreement to which
the Servicer, the Certificate Administrator,
the Depositor or the Mortgage Note Custodian
is a party)
----------------------------------------------------------------------------------------------------------------
Item 1.03- Bankruptcy or Receivership (i) Depositor, as to itself, the sponsor, any
1100(d)(1) party, any significant obligor, any
credit enhancement provider or derivative
counterparty and any other transaction party,
to the extent known to the Depositor, (ii)
Trustee, as to itself, (iii) Certificate
Administrator, as to itself, (iv) Paying Agent,
as to itself, and (v) Servicer, as to itself
and any other transaction party, to the extent
known to the Servicer
----------------------------------------------------------------------------------------------------------------
Item 2.04- Triggering Events that Accelerate or Increase Servicer
a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet
Arrangement
----------------------------------------------------------------------------------------------------------------
Item 3.03- Material Modification to Rights of Security Servicer, Certificate Administrator
Holders
----------------------------------------------------------------------------------------------------------------
Item 5.03- Amendments of Articles of Incorporation or Depositor
Bylaws; Change of Fiscal Year
----------------------------------------------------------------------------------------------------------------
Item 6.01- ABS Informational and Computational Material Depositor
----------------------------------------------------------------------------------------------------------------
Item 6.02- Change of Servicer, Certificate Servicer, Certificate Administrator, Trustee
Administrator, Paying Agent or Trustee
----------------------------------------------------------------------------------------------------------------
Item 6.03- Change in Credit Enhancement or External Depositor, Servicer
Support
----------------------------------------------------------------------------------------------------------------
Item 6.04- Failure to Make a Required Distribution Certificate Administrator, Paying Agent
----------------------------------------------------------------------------------------------------------------
Item 6.05- Securities Act Updating Disclosure Depositor
----------------------------------------------------------------------------------------------------------------
Item 7.01- Reg FD Disclosure Depositor
----------------------------------------------------------------------------------------------------------------
Item 8.01-Other Events Depositor, Certificate Administrator
----------------------------------------------------------------------------------------------------------------
Item 9.01 Depositor, Certificate Administrator
----------------------------------------------------------------------------------------------------------------
EXHIBIT A-1
FORM OF CLASS A CERTIFICATES
REMIC Pass-Through Certificates, Series 2007-2
Class A-[*] Certificate
representing an ownership interest in a trust fund consisting
primarily of mortgage loans acquired by
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
certificate no. 1
distribution day: 25th of each month
first distribution day: July 25, 2007
stated final maturity: June 25, 2037
--------------------------------------------------------------------------------
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC") to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or such other name as requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or such
other entity as is requested by an authorized representative of DTC), any
transfer, pledge, or other use hereof for value or otherwise by or to any person
is wrongful inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
Neither this certificate nor the underlying mortgage loans are insured or
guaranteed by the United States government, the Federal Deposit Insurance
Corporation or any other governmental agency or instrumentality. This
certificate does not represent an interest in or obligation of Citicorp
Residential Mortgage Securities, Inc., CitiMortgage, Inc., Citicorp Trust Bank,
fsb, any affiliate thereof, or their ultimate parent, Citigroup Inc.
--------------------------------------------------------------------------------
THIS CERTIFIES THAT, for value received, Cede & Co. is the registered holder of
the initial principal balance of the class of certificates listed below.
class initial principal balance certificate rate CUSIP ISIN
--------------------------------------------------------------------------------
A-[*] $[ ] [ ]%
Principal is paid on this certificate in accordance with the terms of the
Pooling Agreement. Accordingly, at any time the outstanding principal balance of
this certificate may be less than its initial principal amount.
This certificate represents an undivided beneficial ownership interest in the
Trust Fund created pursuant to the Pooling and Servicing Agreement dated as of
June 1, 2007 (the "Pooling Agreement") among Citicorp Residential Mortgage
Securities, Inc., as Depositor, CitiMortgage, Inc., as Servicer and Certificate
Administrator, Citibank, N.A., as Paying Agent, Certificate Registrar and
Authenticating Agent, and U.S. Bank National Association, as Trustee. Terms used
in this certificate that are defined in the Pooling Agreement have the meanings
assigned to them in the Pooling Agreement.
This certificate is one of a duly authorized issue of certificates designated as
Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates,
Series 2007-2, consisting of, for REMIC purposes, seven senior classes, ten
subordinated classes and one class of residual certificates.
The class of securities represented by this certificate constitutes an interest
in a "regular interest" in a real estate mortgage investment conduit ("REMIC")
within the meaning of Section 860G(a)(1) of the Internal Revenue Code of 1986,
as amended, and in certain other assets.
Certificates governed by Pooling Agreement
The certificates are issued pursuant to the Pooling Agreement, which states the
rights, limitations (including restrictions on transfer), duties and immunities
of the Depositor, the Servicer, the Trustee, the Certificate Administrator, the
Paying Agent, the Certificate Registrar and the holders of the certificates,
specifies how amounts of interest and principal distributable on the classes of
certificates are calculated and when such amounts are payable, sets forth the
relative priorities of the classes of certificates to payments and to allocation
of losses, and sets forth the terms upon which the certificates are to be
authenticated and delivered, and other matters relevant to an investment in
certificates. Holders may obtain a copy of the Pooling Agreement (without
exhibits) from the Trustee.
Optional early termination
This certificate may receive a final distribution of all amounts owing in
respect of the class represented by this certificate before its last scheduled
distribution day if CitiMortgage, Inc. (or its assignee) exercises its right
under the Pooling Agreement to repurchase all of the mortgage loans in the Trust
Fund. This right cannot be exercised until the aggregate scheduled principal
balance of such mortgage loans is less than 10% of the aggregate scheduled
principal balance of the mortgage loans as of the cut-off date. [In the event
this right is not exercised at such time, the certificate rate of the class
A-[*] Certificates will equal the certificate rate listed on the first page of
this Certificate plus 0.50% per annum, subject to and in accordance with the
terms of the Pooling Agreement.] [In the event this right is not exercised at
such time, the Class A-1b Margin on the class A-1b Certificates will increase to
double its original percentage, subject to and in accordance with the terms of
the Pooling Agreement.]
Governing law
This certificate and the Pooling Agreement are governed by the laws of the State
of New York.
Authentication required
Unless this certificate has been executed by the Trustee or a duly authorized
Authenticating Agent by manual signature, this certificate shall not be entitled
to any benefit under the Pooling Agreement or be valid for any purpose.
IN WITNESS WHEREOF, Citicorp Residential Mortgage Securities, Inc. has
caused this certificate to be duly executed.
CITICORP RESIDENTIAL MORTGAGE
SECURITIES, INC.
By:
-------------------------------------
Name:
Title:
This is one of the certificates referred to in the Pooling Agreement referred to
above.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
-------------------------------------
Authorized Signatory
or
CITIBANK, N.A.,
as Authenticating Agent
By:
-------------------------------------
Authorized Signatory
Date:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - _______________ Custodian ____________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act ________________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
________________________________________________________________________________
attorney to transfer said certificate on the books of the Certificate Registrar
with full power of substitution in the premises.
Dated: ________________ __________________________
Signature Guaranteed by:_________________________________________
NOTICE: the signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatever, and must be guaranteed by a
member of a Signature Guarantee Medallion Program.
Exhibit A-2
FORM OF CLASS M CERTIFICATES
REMIC Pass-Through Certificates, Series 2007-2
Subordinated Class M-[*] Certificate
representing an ownership interest in a trust fund consisting
primarily of mortgage loans acquired by
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
certificate no. 1
distribution day: 25th of each month
first distribution day: July 25, 2007
stated final maturity: June 25, 2037
--------------------------------------------------------------------------------
This class M-[*] certificate is subordinated in right of payments to the class
A, class M-[*] and class M-[*] certificates, as described in the Pooling
Agreement referred to below.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC") to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or such other name as requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or such
other entity as is requested by an authorized representative of DTC), any
transfer, pledge, or other use hereof for value or otherwise by or to any person
is wrongful inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
Neither this certificate nor the underlying mortgage loans are insured or
guaranteed by the United States government, the Federal Deposit Insurance
Corporation or any other governmental agency or instrumentality. This
certificate does not represent an interest in or obligation of Citicorp
Residential Mortgage Securities, Inc., CitiMortgage, Inc., Citicorp Trust Bank,
fsb, any affiliate thereof, or their ultimate parent, Citigroup Inc.
--------------------------------------------------------------------------------
THIS CERTIFIES THAT, for value received, Cede & Co. is the registered holder of
the initial principal balance of the class of certificates listed below.
initial principal
class balance certificate rate CUSIP ISIN
--------------------------------------------------------------------------------
M-[*] $[ ] [ ]%
Principal is paid on this certificate in accordance with the terms of the
Pooling Agreement. Accordingly, at any time the outstanding principal balance of
this certificate may be less than its initial principal amount.
This certificate represents an undivided beneficial ownership interest in the
Trust Fund created pursuant to the Pooling and Servicing Agreement dated as of
June 1, 2007 (the "Pooling Agreement") among Citicorp Residential Mortgage
Securities, Inc., as Depositor, CitiMortgage, Inc., as Servicer and Certificate
Administrator, Citibank, N.A., as Paying Agent, Certificate Registrar and
Authenticating Agent, and U.S. Bank National Association, as Trustee. Terms used
in this certificate that are defined in the Pooling Agreement have the meanings
assigned to them in the Pooling Agreement.
This certificate is one of a duly authorized issue of certificates designated as
Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates,
Series 2007-2, consisting of, for REMIC purposes, seven senior classes, ten
subordinated classes and one class of residual certificates.
The class of securities represented by this certificate constitutes an interest
in a "regular interest" in a real estate mortgage investment conduit ("REMIC")
within the meaning of Section 860G(a)(1) of the Internal Revenue Code of 1986,
as amended, and in certain other assets.
Certificates governed by Pooling Agreement
The certificates are issued pursuant to the Pooling Agreement, which states the
rights, limitations (including restrictions on transfer), duties and immunities
of the Depositor, the Servicer, the Trustee, the Certificate Administrator, the
Paying Agent, the Certificate Registrar and the holders of the certificates,
specifies how amounts of interest and principal distributable on the classes of
certificates are calculated and when such amounts are payable, sets forth the
relative priorities of the classes of certificates to payments and to allocation
of losses, and sets forth the terms upon which the certificates are to be
authenticated and delivered, and other matters relevant to an investment in
certificates. Holders may obtain a copy of the Pooling Agreement (without
exhibits) from the Trustee.
Optional early termination
This certificate may receive a final distribution of all amounts owing in
respect of the class represented by this certificate before its last scheduled
distribution day if CitiMortgage, Inc. (or its assignee) exercises its right
under the Pooling Agreement to repurchase all of the mortgage loans in the Trust
Fund. This right cannot be exercised until the aggregate scheduled principal
balance of such mortgage loans is less than 10% of the aggregate scheduled
principal balance of the mortgage loans as of the cut-off date. In the event
this right is not exercised at such time, the certificate rate of the class
M-[*] Certificates will equal the certificate rate listed on the first page of
this Certificate plus 0.50% per annum, subject to and in accordance with the
terms of the Pooling Agreement.
Governing law
This certificate and the Pooling Agreement are governed by the laws of the State
of New York.
Authentication required
Unless this certificate has been executed by the Trustee or a duly authorized
Authenticating Agent by manual signature, this certificate shall not be entitled
to any benefit under the Pooling Agreement or be valid for any purpose.
IN WITNESS WHEREOF, Citicorp Residential Mortgage Securities, Inc. has
caused this certificate to be duly executed.
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
By:
-----------------------------------------------
Name:
Title:
This is one of the certificates referred to in the Pooling Agreement referred to
above.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
--------------------------------
Authorized Signatory
or
CITIBANK, N.A.,
as Authenticating Agent
By:
--------------------------------
Authorized Signatory
Date:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - _______________ Custodian ____________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act ________________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
________________________________________________________________________________
attorney to transfer said certificate on the books of the Certificate Registrar
with full power of substitution in the premises.
Dated: ________________ __________________________
Signature Guaranteed by:_________________________________________
NOTICE: the signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatever, and must be guaranteed by a
member of a Signature Guarantee Medallion Program.
Exhibit A-3
Form of Class CE Certificates
REMIC Pass-Through Certificates, Series 2007-2
Class CE Certificate
representing an ownership interest in a trust fund consisting
primarily of mortgage loans acquired by
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
certificate no. 1 100% percentage interest
CUSIP [ ] ISIN [ ]
--------------------------------------------------------------------------------
This class CE certificate is subordinated in right of payments to the
class A and class M certificates, as described in the Pooling Agreement referred
to below.
This certificate has not been registered under the Securities Act of 1933,
as amended, and may not be sold, or offered for sale, transferred or otherwise
disposed of unless such sale, transfer or other disposition is made pursuant to
an effective registration statement under such act and any applicable blue sky
law or unless an exemption under such act and any applicable blue sky law is
available.
This certificate may not be purchased by or transferred to any person that
is an employee benefit plan subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code") or any Governmental Plan, as
defined in Section 3(32) of ERISA, subject to any federal, state or local law
which is, to a material extent, similar to the foregoing provisions of ERISA or
the Code (collectively, a "Plan") or any person investing the assets of a Plan
except as provided in section 5.02 of the Pooling Agreement referred to below.
Neither this certificate nor the underlying mortgage loans are insured or
guaranteed by the United States government, the Federal Deposit Insurance
Corporation or any other governmental agency or instrumentality. This
certificate does not represent an interest in or obligation of Citicorp
Residential Mortgage Securities, Inc., CitiMortgage, Inc., Citicorp Trust Bank,
fsb, any affiliate thereof, or their ultimate parent, Citigroup Inc.
--------------------------------------------------------------------------------
THIS CERTIFIES THAT, for value received, Citicorp Residential Mortgage
Securities, Inc. is the registered holder of the percentage interest set forth
above, representing an ownership interest in the Trust Fund created pursuant to
the Pooling and Servicing Agreement dated as of June 1, 2007 (the "Pooling
Agreement") among Citicorp Residential Mortgage Securities, Inc., as Depositor,
CitiMortgage, Inc., as Servicer and Certificate Administrator, Citibank, N.A.,
as Paying Agent, Certificate Registrar and Authenticating Agent, and U.S. Bank
National Association, as Trustee. Terms used in this certificate that are
defined in the Pooling Agreement have the meanings assigned to them in the
Pooling Agreement.
The class CE certificate will not be entitled to payments until such time as
described in the Pooling Agreement.
This certificate is one of a duly authorized issue of certificates designated as
Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates,
Series 2007-2, consisting of, for REMIC purposes, seven senior classes, ten
subordinated classes and one class of residual certificates.
Certificates governed by Pooling Agreement
The certificates are issued pursuant to the Pooling Agreement, which states the
rights, limitations (including restrictions on transfer), duties and immunities
of Depositor, the Servicer, the Trustee, the Certificate Administrator, the
Paying Agent, the Certificate Registrar and the holders of the certificates, the
Trustee and the holders of the certificates, specifies how amounts of interest
and principal distributable on the classes of certificates are calculated and
when such amounts are payable, sets forth the relative priorities of the classes
of certificates to payments and to allocation of losses, and sets forth the
terms upon which the certificates are to be authenticated and delivered, and
other matters relevant to an investment in certificates. Holders may obtain a
copy of the Pooling Agreement (without exhibits) from the Trustee.
U.S. federal income tax information
This class CE certificate (exclusive of its obligation to pay Cap Amounts, if
any) represents a "regular interest" in the Upper-Tier REMIC within the meaning
of Code Section 860G(a)(1). As a condition of ownership hereof, the holder
hereof agrees that it will not take or cause to be taken any action that would
adversely affect the status of the asset pool comprising the Trust Fund as two
separate REMICs.
Governing law
This certificate and the Pooling Agreement are governed by the laws of the State
of New York.
Authentication required
Unless this certificate has been executed by the Trustee or a duly authorized
Authenticating Agent by manual signature, this certificate shall not be entitled
to any benefit under the Pooling Agreement or be valid for any purpose.
IN WITNESS WHEREOF, Citicorp Residential Mortgage Securities, Inc. has
caused this certificate to be duly executed.
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
By:
-----------------------------------------------
Name:
Title:
This is one of the certificates referred to in the Pooling Agreement referred to
above.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
-----------------------------------------------
Authorized Signatory
or
CITIBANK, N.A.,
as Authenticating Agent
By:
-----------------------------------------------
Authorized Signatory
Date:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - _______________ Custodian ____________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act ________________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
________________________________________________________________________________
attorney to transfer said certificate on the books of the Certificate Registrar
with full power of substitution in the premises.
Dated: ________________ __________________________
Signature Guaranteed by:_________________________________________
NOTICE: the signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatever, and must be guaranteed by a
member of a Signature Guarantee Medallion Program.
Exhibit A-4
Form of Class R Certificate
REMIC Pass-Through Certificates, Series 2007-2
Residual Class R Certificate
representing an ownership interest in a trust fund consisting
primarily of mortgage loans acquired by
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
certificate no. 1 100% percentage interest
CUSIP [ ] ISIN [ ]
--------------------------------------------------------------------------------
This certificate has not been registered under the Securities Act of 1933,
as amended, and may not be sold, or offered for sale, transferred or otherwise
disposed of unless such sale, transfer or other disposition is made pursuant to
an effective registration statement under such act and any applicable blue sky
law or unless an exemption under such act and any applicable blue sky law is
available.
This certificate may not be purchased by or transferred to any person that
is an employee benefit plan subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code") or any Governmental Plan, as
defined in Section 3(32) of ERISA, subject to any federal, state or local law
which is, to a material extent, similar to the foregoing provisions of ERISA or
the Code (collectively, a "Plan") or any person investing the assets of a Plan
except as provided in section 5.02 of the Pooling Agreement referred to below.
Transfer of this certificate is restricted as set forth in section 5.02 of
the Pooling Agreement. As a condition of ownership of this certificate, a
transferee must furnish an affidavit to the transferor and the Trustee that (a)
it is not a "disqualified organization," as defined in Section 860E(e)(5) of the
Code, (b) it is not acquiring this certificate as an agent (including a broker,
nominee or other middleman) on behalf of a disqualified organization, (c) it
understands that it may incur tax liabilities in excess of cash flows generated
by the residual interest and it intends to pay taxes associated with holding the
residual interest as they become due, (d) it historically has paid its debts as
they have come due and intends to pay its debts as they come due in the future,
(e) it will not cause the income with respect to this certificate to be
attributable to a foreign permanent establishment or fixed base, within the
meaning of an applicable income tax treaty, of it or any other person, and (f)
it is not a "Non-permitted Foreign holder," as defined in section 5.02 of the
Pooling Agreement. By accepting this certificate, a transferee will be subject
to such restrictions on transferability, and will have consented to any
amendments to the Pooling Agreement that are required to ensure that this
certificate is not transferred to a disqualified organization or its agent, or
to a Non-permitted Foreign holder. To satisfy a regulatory safe harbor against
the disregard of such transfer, the transferor may be required to conduct a
reasonable investigation of the financial condition of the transferee and either
transfer this certificate at a specified minimum price or transfer this
certificate to an eligible transferee.
Neither this certificate nor the underlying mortgage loans are insured or
guaranteed by the United States government, the Federal Deposit Insurance
Corporation or any other governmental agency or instrumentality. This
certificate does not represent an interest in or obligation of Citicorp
Residential Mortgage Securities, Inc., CitiMortgage, Inc., Citicorp Trust Bank,
fsb, any affiliate thereof, or their ultimate parent, Citigroup Inc.
--------------------------------------------------------------------------------
THIS CERTIFIES THAT, for value received, Citicorp Residential Mortgage
Securities, Inc. is the registered holder of the percentage interest set forth
above, representing an ownership interest in the Trust Fund created pursuant to
the Pooling and Servicing Agreement dated as of June 1, 2007 (the "Pooling
Agreement") among Citicorp Residential Mortgage Securities, Inc., as Depositor,
CitiMortgage, Inc., as Servicer and Certificate Administrator, Citibank, N.A.,
as Paying Agent, Certificate Registrar and Authenticating Agent, and U.S. Bank
National Association, as Trustee. Terms used in this certificate that are
defined in the Pooling Agreement have the meanings assigned to them in the
Pooling Agreement.
The class R certificate will not be entitled to payments until such time as
described in the Pooling Agreement.
This certificate is one of a duly authorized issue of certificates designated as
Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates,
Series 2007-2, consisting of, for REMIC purposes, seven senior classes, ten
subordinated classes and one class of residual certificates.
Certificates governed by Pooling Agreement
The certificates are issued pursuant to the Pooling Agreement, which states the
rights, limitations (including restrictions on transfer), duties and immunities
of Depositor, the Servicer, the Trustee, the Certificate Administrator, the
Paying Agent, the Certificate Registrar and the holders of the certificates,
specifies how amounts of interest and principal distributable on the classes of
certificates are calculated and when such amounts are payable, sets forth the
relative priorities of the classes of certificates to payments and to allocation
of losses, and sets forth the terms upon which the certificates are to be
authenticated and delivered, and other matters relevant to an investment in
certificates. Holders may obtain a copy of the Pooling Agreement (without
exhibits) from the Trustee.
U.S. federal income tax information
Election will be made to treat the asset pool within the Trust Fund as two
separate real estate mortgage investment conduits (each a "REMIC," or in the
alternative, the "Lower-Tier REMIC" and the "Upper-Tier REMIC"). This class R
certificate represents the "residual interest" in the Upper-Tier and Lower-Tier
REMICs within the meaning of Code Section 860G(a)(2). As a condition of
ownership hereof, the holder hereof agrees that it will not take or cause to be
taken any action that would adversely affect the status of the asset pool
comprising the Trust Fund as two separate REMICs.
The holder further agrees to the designation of the Servicer as its agent to act
as "tax matters person" of the Upper-Tier REMIC and the Lower-Tier REMIC for
purposes of Subchapter C of Chapter 63 of Subtitle F of the Code or, if
requested by the Servicer, to act as tax matters person.
Governing law
This certificate and the Pooling Agreement are governed by the laws of the State
of New York.
Authentication required
Unless this certificate has been executed by the Trustee or a duly authorized
Authenticating Agent by manual signature, this certificate shall not be entitled
to any benefit under the Pooling Agreement or be valid for any purpose.
IN WITNESS WHEREOF, Citicorp Residential Mortgage Securities, Inc. has
caused this certificate to be duly executed.
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
By:
-------------------------------------------
Name:
Title:
This is one of the certificates referred to in the Pooling Agreement referred to
above.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
-------------------------------------------
Authorized Signatory
or
CITIBANK, N.A.,
as Authenticating Agent
By:
-------------------------------------------
Authorized Signatory
Date:
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - _______________ Custodian ____________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act ________________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address, including zip code, of assignee)
________________________________________________________________________________
the within certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
________________________________________________________________________________
attorney to transfer said certificate on the books of the Certificate Registrar
with full power of substitution in the premises.
Dated: ________________ __________________________
Signature Guaranteed by:_________________________________________
NOTICE: the signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatever, and must be guaranteed by a
member of a Signature Guarantee Medallion Program.
EXHIBIT B
MORTGAGE LOAN SCHEDULE
[Delivered to Trustee]
EXHIBIT C
FORM OF PURCHASER LETTER
[Purchaser]
[Date]
Citicorp Residential Mortgage Securities, Inc.
0000 Xxxxxxxxxx Xxxxx
X'Xxxxxx, Xxxxxxxx 00000-0000
U.S. Bank National Association
Corporate Trust Services
Xxx Xxxxxxx Xxxxxx-0xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Ladies and Gentlemen:
In connection with the purchase by us of $
initial principal balance of the Citicorp Residential Mortgage Trust Series
2007-2, REMIC Pass-Through Certificates, class [CE][R] certificates, we confirm
that:
1. We understand that the class [CE][R] certificates are not being
registered under the Securities Act of 1933, as amended (the "Securities Act")
or any state securities or "blue sky" laws and are being transferred to us in a
transaction that is exempt from the registration requirements of the Securities
Act and any such laws.
2. We (check one)
|_| have such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of investment in the
class [CE][R] certificates, we are able to bear the economic risk of
investment in the class [CE][R] certificates and we are an accredited
investor as defined in Regulation D under the Securities Act. We have such
knowledge and experience in financial and business matters, specifically
in the field of mortgage related securities, as to be able to evaluate the
risk of purchasing a certificate which is subordinate in right of payment,
and we have direct, personal and significant experience in making
investments in mortgage related securities. If we are non-institutional
investors, our net worth (exclusive of our primary residence) is at least
$1,000,000.
|_| are "Qualified Institutional Buyers" within the meaning of Rule 144A
promulgated under the Securities Act.
3. We will acquire the class [CE][R] certificates for our own account or
for accounts as to which we exercise sole investment discretion and not with a
view to any distribution of the class [CE][R] certificates, subject,
nevertheless, to the understanding that disposition of our property shall at all
times be and remain within our control.
4. We agree that our class [CE][R] certificates must be held indefinitely
by us unless subsequently registered under the Securities Act and any applicable
state securities or "blue sky" laws or unless exemptions from the registration
requirements of the Securities Act and such laws are available.
5. We agree that in the event that at some future time we wish to sell,
dispose of or otherwise transfer any of our class [CE] [R] certificates, we will
not transfer any of such class [CE][R] certificates unless:
(A) (1) the transfer is made to an Eligible Purchaser (as defined
below), (2) a letter to substantially the same effect as this letter is executed
promptly by such Eligible Purchaser or by an Eligible Dealer (as defined below)
on behalf of such Eligible Purchaser and (3) all offers or solicitations in
connection with the sale (if a sale), whether directly or through any agent on
our behalf, are limited only to Eligible Purchasers and are not made by means of
any form of general solicitation or general advertising whatsoever; or
(B) Such class [CE][R] certificates are otherwise sold in a
transaction that does not require registration under the Securities Act.
"Eligible Purchaser" means an Eligible Dealer or a corporation,
partnership or other entity which we have reasonable grounds to believe and do
believe can make representations with respect to itself to substantially the
same effect as the representations set forth herein; "Eligible Dealer" means any
corporation or other entity having as a principal business acting as a broker or
dealer in securities.
6. We understand that each of the class [CE][R] certificates will bear a
legend to substantially the following effect:
This class [CE] certificate is subordinated in right of payments to the
class A and class M certificates, as described in the Pooling Agreement referred
to herein. This certificate has not been registered under the Securities Act of
1933, as amended, and may not be sold, or offered for sale, transferred or
otherwise disposed of unless such sale, transfer or other disposition is made
pursuant to an effective registration statement under such act and any
applicable blue sky law or unless an exemption under such act and any applicable
blue sky law is available.
This certificate may not be purchased by or transferred to any person that
is an employee benefit plan subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code") or any Governmental Plan, as
defined in Section 3(32) of ERISA, subject to any federal, state or local law
which is, to a material extent, similar to the foregoing provisions of ERISA or
the Code (collectively, a "Plan") or any person investing the assets of a Plan
except as provided in section 5.2 of the Pooling Agreement referred to herein.
Very truly yours,
[Name of Purchaser]
By:*
----------------------------------
Name:
Title:
----------------
* This letter may be signed by Purchaser's attorney-in-fact if an executed power
of attorney to such attorney-in-fact is attached hereto; provided that, upon
written instruction from the Issuer to the Trustee, no such attachment shall be
required.
EXHIBIT D
FORM OF ERISA LETTER
[Purchaser]
[Date]
Citicorp Residential Mortgage Securities, Inc.
0000 Xxxxxxxxxx Xxxxx
X'Xxxxxx, Xxxxxxxx 00000-0000
U.S. Bank National Association
One Federal Street, 3rd floor
Xxxxxx, Xxxxxxxxxxxxx 00000
Citibank, N.A.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: 15th Floor Window
Ladies and Gentlemen:
In connection with the purchase by us of $_______________ initial
principal balance of the Citicorp Residential Mortgage Trust Series 2007-2,
REMIC Pass-Through Certificates, class [CE][R] certificates we confirm that:
We (check one)
|_| are not an employee benefit plan subject to the fiduciary responsibility
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or Section 4975 of the Internal Revenue Code of 1986, as amended (the
"Code") or any governmental plan, as defined in Section 3(32) of ERISA, subject
to any federal, state or local law ("Similar Law") which is, to a material
extent, similar to the foregoing provisions of ERISA or the Code (collectively,
a "Plan"), an agent acting on behalf of a Plan, or a person utilizing the assets
of a Plan or
|_| have provided a "Benefit Plan Opinion" satisfactory to Citicorp Residential
Mortgage Securities, Inc. and the Trustee of the trust fund. A Benefit Plan
Opinion is an opinion of counsel to the effect that the proposed transfer will
not (a) constitute or result in a non-exempt prohibited transaction under ERISA
or Section 4975 of the Code or Similar Law, or (b) give rise to a fiduciary duty
under ERISA, Section 4975 of the Code or Similar Law on the part of Citicorp
Mortgage Securities, Inc., the Servicer or the Trustee with respect to any Plan.
The certificates will be registered in the name of [Nominee Name] but the
undersigned will be the beneficial owner thereof.
Very truly yours,
[Name of Purchaser]
By:
-----------------------------------
Name:
Title:
---------------
* This letter may be signed by Purchaser's attorney-in-fact if an executed
power of attorney to such attorney-in-fact is attached hereto; provided that,
upon written instruction from the Issuer to the Trustee, no such attachment
shall be required.
EXHIBIT E
FORM OF SERVICER CERTIFICATION
Citicorp Residential Mortgage Trust Series 2007-2 Trust
REMIC Pass-Through Certificates
I, [________], a [_____________] of CitiMortgage, Inc. (the
"Servicer"), certify that:
1. I have reviewed this report on Form 10-K and all reports on Form 10-D
required to be filed in respect of the period covered by this report on
Form 10-K of the Citicorp Residential Mortgage Trust Series 0000-0 (xxx
"Xxxxxxxx Xxx Periodic Reports");
2. Based on my knowledge, the Exchange Act Periodic Reports, taken as a
whole, do not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading
with respect to the period covered by this report;
3. Based on my knowledge, all of the distribution, servicing and other
information required to be provided under Form 10-D for the period covered
by this report is included in the Exchange Act Periodic Reports;
4. I am responsible for reviewing the activities performed by the Servicer
and based upon my knowledge and the compliance review conducted in
preparing the servicer compliance statement required in this report under
Item 1123 of Regulation AB, and except as disclosed in the Exchange Act
Periodic Reports, the Servicer has fulfilled its obligations under the
pooling and servicing agreement, dated June 1, 2007, among Citicorp
Residential Mortgage Securities, Inc., as depositor, Citibank, N.A., as
paying agent, certificate registrar and authenticating agent, U.S. Bank
National Association, as trustee, and the Servicer; and
5. All of the reports on assessment of compliance with the servicing criteria
for asset-backed securities and their related attestation reports on
assessment of compliance with servicing criteria for asset-backed
securities required to be included in this report in accordance with Item
1122 of Regulation AB and Exchange Act Rules 13a-18 and 15d-18 have been
included as an exhibit to this report, except as otherwise disclosed in
this report. Any material instances of noncompliance described in such
reports have been disclosed in this report on Form 10-K.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated part[y][ies]:
[___________].
[_________], 2007
By:
--------------------------------------
Name:
Title:
EXHIBIT F
------------------------------------------------------------------------------
MORTGAGE NOTE CUSTODIAL AGREEMENT
------------------------------------------------------------------------------
June 1, 2007
PARTIES
o U.S. Bank National Association, a national banking association, as trustee
(the Trustee)
o Citibank, N.A., a national banking association (Citibank)
o Citicorp Residential Mortgage Securities, Inc., a Delaware corporation
(CRMSI)
o CitiMortgage, Inc., as Servicer and Certificate Administrator (CitiMortgage)
BACKGROUND
The Trustee, CRMSI, CitiMortgage and Citibank, N.A. are entering into a
Pooling and Servicing Agreement dated June 1, 2007 relating to Citicorp
Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2007-2 (the Pooling Agreement). Unless otherwise stated, terms defined in the
Pooling Agreement are used in this agreement with the same meaning.
Pursuant to the Pooling Agreement,
o CRMSI will sell to the Trustee, without recourse, the mortgage loans
identified in exhibit B to the Pooling Agreement, and
o Citibank has been designated as Mortgage Note Custodian.
AGREEMENT
1 Appointment as Custodian; Acknowledgment of Receipt
(a) Citibank will serve as mortgage note custodian (Mortgage Note Custodian)
under the Pooling Agreement. Citibank certifies to the Trustee that Citibank is
qualified to serve as Mortgage Note Custodian under the Pooling Agreement.
Citibank will act as Mortgage Note Custodian solely for the benefit of the
Trustee and the certificate holders.
(b) CRMSI has delivered to Citibank, as Mortgage Note Custodian, the mortgage
notes (or lost note affidavits in the case of a mortgage note that has been
permanently lost, misplaced or destroyed) required to be delivered to the
Mortgage Note Custodian under section 2.01 of the Pooling Agreement (the
Mortgage Notes). Citibank acknowledges receipt of the Pooling Agreement and the
Mortgage Notes.
(c) CitiMortgage will pay the reasonable custodial fees and expenses of
Citibank or its successor, including the Trustee if the Trustee holds any
Mortgage Notes directly as Mortgage Note Custodian.
(d) Upon CitiMortgage's receipt of notice from Citibank or the Trustee that
Citibank has breached this agreement or the Pooling Agreement, CitiMortgage will
cause Citibank to comply with this agreement and the Pooling Agreement.
2 Maintenance of office
Citibank will maintain the Mortgage Notes, at the office of Citibank located
at Citibank, N.A., 0000 Xxxxxxxxx Xxxxx, X/X XX0000, Frederick, Md. 21703, or at
such other office of Citibank as it designates by 30 days' prior written notice
to the Trustee and CRMSI.
3 Duties of Mortgage Note Custodian
As Mortgage Note Custodian, Citibank will have all of the rights and
obligations of the Mortgage Note Custodian set forth in the Pooling Agreement,
including but not limited to the following:
(a) Safekeeping. Citibank will
o identify each custodial file by loan number, address of mortgaged property,
and name of Mortgagor,
o maintain the Mortgage Notes in secure and fire resistant facilities in
accordance with customary standards for such custody,
o identify the Mortgage Notes as being held and to hold the Mortgage Notes for
and on behalf of the Trustee for the benefit of all present and future
certificate holders,
o maintain accurate records pertaining to the Mortgage Notes as will enable the
Trustee to comply with the terms and conditions of the Pooling Agreement, and
o maintain at all times a current inventory and conduct periodic physical
inspections of the Mortgage Notes in such a manner as will enable the Trustee
and CitiMortgage to verify the accuracy of Citibank's record-keeping, inventory
and physical possession.
Citibank will promptly report to the Trustee and CitiMortgage any failure on
its part to hold the Mortgage Notes as herein provided and will promptly take
appropriate action to remedy any such failure.
(b) Release of Files. Citibank is authorized, upon receipt of a direction
from the Trustee pursuant to section 3.12, "Trustee to Cooperate; Release of
Files," of the Pooling Agreement, to release to CitiMortgage or its designee, as
directed, the custodial file or the documents set forth in such direction. All
documents so released will be held by the recipient in trust for the benefit of
the Trustee in accordance with the Pooling Agreement. Such Mortgage Notes will
be returned to Citibank when the need therefor in connection with foreclosure or
servicing no longer exists, unless the mortgage loan is liquidated or paid in
full. Citibank is also authorized to release any Mortgage Note to CRMSI after
purchase by CRMSI of the related mortgage loan or the property securing such
mortgage loan, all as provided in, and subject to the provisions of, the Pooling
Agreement.
(c) Review of Mortgage Notes; Administration; Reports. Citibank will attend
to all non-discretionary details in connection with maintaining custody of the
Mortgage Notes, including reviewing each Mortgage Note within 90 days after
issuance of the certificates, and ascertaining that the Mortgage Note has been
executed and received, in connection therewith, delivering, in electronic form,
such reports and certifications to the Trustee and CRMSI as are required by the
Pooling Agreement. If in the course of such review, or if at any time during the
term of this agreement, Citibank determines that a document or documents
constituting part of a custodial file is defective or missing, it will promptly
so notify, in electronic form, the Trustee and CitiMortgage in accordance with
the provisions of section 2.02, "Acceptance by Trustee," of the Pooling
Agreement, and will, within 30 days thereafter, provide the Trustee with an
updated report certifying as to the completeness of the custodial file, with any
applicable exceptions noted thereon. Citibank will assist the Trustee and
CitiMortgage generally in the preparation of reports (including by providing
information reasonably requested as necessary to such preparation) to
certificate holders or to regulatory bodies to the extent necessitated by
Citibank's custody of the Mortgage Notes.
(d) Successor trustees. Citibank will, in accordance with section 8.08.
"Successor Trustee," of the Pooling Agreement, amend this agreement to make a
successor Trustee the successor to the predecessor Trustee under this agreement.
(e) Assessments of Compliance and Attestation Statements. Citibank will, in
its capacity as Mortgage Note Custodian, perform the obligations of the Mortgage
Note Custodian under Sections 3.15(a), 3.15(b) and 3.15(c) of the Pooling
Agreement, and will provide any Additional Form 10-D Disclosure, any Additional
Form 10-K Disclosure and any Form 8-K Disclosure Information (as such terms are
defined in the Pooling Agreement) required so to be delivered by the Mortgage
Note Custodian under Section 4.09 of the Pooling Agreement.
4 Access to Records
Subject to section 3(b), upon not less than three days' notice, Citibank will
permit the Trustee, CitiMortgage or any Subservicer appointed by CitiMortgage or
their duly authorized representatives, attorneys or auditors to inspect the
Mortgage Notes and the books and records maintained by Citibank pursuant hereto
at such times as the Trustee, CitiMortgage or any Subservicer may reasonably
request, subject only to compliance by the Trustee, CitiMortgage or any
Subservicer with the security procedures of Citibank applied by Citibank to its
own employees having access to these and similar records.
5 Instructions; Authority to Act
Citibank will be deemed to have received proper instructions with respect to
the Mortgage Notes upon its receipt of written instructions signed by a
Responsible Officer of the Trustee or a Servicing Officer of the Servicer. A
certified copy of a resolution of the Board of Directors of the Trustee may be
accepted by Citibank as conclusive evidence of the authority of any such officer
to act and may be considered as in full force and effect until receipt of
written notice to the contrary by Citibank from the Trustee, CitiMortgage or any
Subservicer. Such instructions may be general or specific in terms. Citibank may
rely upon and will be protected in acting in good faith upon any such written
instructions received by it and which it reasonably believes to be genuine and
duly authorized with respect to all matters pertaining to this agreement and its
duties hereunder.
6 Indemnification
(a) Citibank will indemnify the Trustee for any and all liabilities,
obligations, losses, damages, payments, costs or expenses of any kind whatsoever
which may be imposed on, incurred or asserted against the Trustee as the result
of any act or omission in any way relating to the maintenance and custody by
Citibank of the Mortgage Notes; provided, however, that Citibank will not be
liable for any portion of any such amount resulting from the gross negligence or
willful misconduct of the Trustee.
(b) To the extent provided under Section 8.05(b) of the Pooling Agreement,
CitiMortgage will indemnify Citibank and hold it harmless against any loss,
liability or expense incurred without negligence or bad faith on Citibank's
part, arising out of or in connection with the acceptance or administration of
the trust or trusts created under the Pooling Agreement or Citibank's custody of
the Mortgage Notes, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder or under the Pooling Agreement. Such
indemnification will survive the payment of the certificates and termination of
the Trust Fund, as well as the resignation or removal of CitiMortgage as
Servicer (if such action which caused the need for the indemnification occurred
while CitiMortgage acted as Servicer), and for purposes of such indemnification
neither the negligence nor bad faith of the Trustee will be imputed to, or
adversely affect, the right of Citibank to indemnification.
7 Limitation of Mortgage Note Custodian's Liabilities and Duties
(a) Citibank will not be responsible for preparing or filing any reports or
returns relating to federal, state or local income taxes with respect to this
agreement, other than for Citibank's compensation or for reimbursement of
expenses.
(b) Citibank will not be responsible or liable for, and makes no
representation or warranty with respect to, the validity, adequacy or perfection
of any lien upon or security interest in any custodial file.
(c) Any other provision of this agreement to the contrary notwithstanding,
Citibank will have no notice, and will not be bound by any of the terms and
conditions of any other document or agreement executed or delivered in
connection with, or intended to control any part of, the transactions
anticipated by or referred to in this agreement unless Citibank is a signatory
party to that document or agreement. Notwithstanding the foregoing sentence,
Citibank will be deemed to have notice of the terms and conditions (including
without limitation definitions not otherwise set forth in full in this
agreement) of other documents and agreements executed or delivered in connection
with, or intended to control any part of, the transactions anticipated by or
referred to in this agreement, to the extent such terms and provisions are
referenced, or are incorporated by reference, into this agreement only as long
as the Trustee or CitiMortgage will have provided a copy of any such document or
agreement to Citibank.
(d) Citibank's rights and obligations will only be such as are expressly set
forth in this agreement or the Pooling Agreement. In no event will Citibank be
obligated to ascertain or take action except as expressly provided in this
agreement or the Pooling Agreement.
(e) Nothing in this agreement will be deemed to impose on Citibank any
obligation to qualify to do business in any jurisdiction, other than (i) a
jurisdiction where a custodial file is or may be held by Citibank, and (ii)
where failure to qualify could have a material adverse effect on Citibank or its
property or business or on the ability of Citibank to perform it duties
hereunder.
(f) Subject to section 3, under no circumstances will Citibank be obligated
to verify the authenticity of any signature on any of the documents received or
examined by it in connection with this agreement or the authority or capacity of
any person to execute or issue such document, nor will Citibank be responsible
for the value, form, substance, validity, perfection (other than by taking and
continuing possession of the Mortgage Notes), priority, effectiveness or
enforceability of any of such documents, nor will Citibank be under a duty to
inspect, review or examine the documents to determine whether they are
appropriate for the represented purpose or that they have been actually recorded
or that they are other than what they purport to be on their face.
(g) Citibank will have no duty to ascertain whether or not any cash amount or
payment has been received by the Trustee, the CRMSI or any third person.
(h) Citibank may assign its rights and obligations under this agreement, in
whole or in part, to any Affiliate; however, Citibank will notify CRMSI,
CitiMortgage and the Trustee of any such assignment. Citibank may not assign its
rights or obligations under this agreement, in whole or in part, to any other
entity without the prior written consent of CRMSI, CitiMortgage and the Trustee,
which consent will not be unreasonably withheld. An "Affiliate" is an entity
that directly or indirectly controls, is controlled by or is under common
control with Citibank. Notwithstanding any such assignment, Citibank will remain
liable for all of its obligations under this agreement unless the assignment has
been approved by CRMSI, CitiMortgage and the Trustee.
(i) Subject to section 6, "Indemnification," neither Citibank nor any of its
Affiliates, directors, officers, agents, and employees will be liable for
o any action or omission to act hereunder except for its own or such person's
gross negligence, willful misconduct, breach of this agreement or violation of
applicable law, or
o any special, indirect, punitive or consequential damages resulting from any
action taken or omitted to be taken by it or them hereunder or in connection
herewith even if advised of the possibility of such damages.
(j) Citibank will not be required to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
under this Agreement or the Pooling Agreement or in the exercise of any of its
rights and obligations, if, in its sole judgment, it will believe that repayment
of such funds or adequate indemnity against such risk or liability is not
assured to it.
(k) Citibank will not be responsible for delays or failures in performance
resulting from acts beyond its control, such as acts of God, strikes, lockouts,
riots, acts of war or terrorism, epidemics, nationalization, expropriation,
currency restrictions, governmental regulations superimposed after the fact,
fire, communication line failures, computer viruses, power failures, earthquakes
or other disasters.
(l) Any entity into which Citibank may be merged or converted or with which
it may be consolidated, or any entity resulting from any merger, conversion or
consolidation to which Citibank will be a party, or any entity succeeding to the
business of Citibank, will be the successor of Citibank hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
8. Advice of Counsel
Citibank may rely and act upon advice of counsel with respect to its
performance as Mortgage Note Custodian, and will not be liable for any action it
reasonably takes pursuant to such advice, provided that such action is not in
violation of applicable federal or state law.
9. Effective Period, Termination and Amendment, and Interpretive and Additional
Provisions
This agreement may be terminated (a) by Citibank's resignation as Mortgage
Note Custodian, or (b) by either CitiMortgage or the Trustee. In each case, such
termination will be effected by notice to the other parties given no less than
60 days prior to termination. Upon notice of such termination, CitiMortgage will
use its reasonable best efforts to select a successor Mortgage Note Custodian
reasonably acceptable to the Trustee upon substantially the same terms and
conditions as set forth in this agreement. If no such successor Mortgage Note
Custodian has been selected by the 50th day after such notice, the Trustee may,
upon prior notice to CitiMortgage, select a successor Mortgage Note Custodian.
If no successor Mortgage Note Custodian has been selected by CitiMortgage or the
Trustee by the effective date of the Citibank's termination, the Trustee will
act as successor Mortgage Note Custodian until the Trustee and CitiMortgage
agree on a successor Mortgage Note Custodian.
At, or as soon as practicable after, the termination of this agreement,
Citibank will deliver the Mortgage Notes to the successor Mortgage Note
Custodian at such place as the successor Mortgage Note Custodian reasonably
designates.
10. Binding Arbitration
Any misunderstanding or dispute between Citibank and CRMSI or CitiMortgage
arising out of this agreement will be settled through consultation and
negotiation in good faith and a spirit of mutual cooperation. However, if these
attempts fail, such misunderstandings or disputes will be decided by binding
arbitration conducted, upon request by either of them, in New York, New York,
before a single arbitrator designated by the American Arbitration Association
(the AAA), in accordance with the terms of the Commercial Arbitration Rules of
the AAA, and to the maximum extent applicable, the United States Arbitration Act
(Title 9 of the United States Code). Notwithstanding anything herein to the
contrary, either Citibank, CRMSI or CitiMortgage may proceed to a court of
competent jurisdiction to obtain equitable relief at any time. An arbitrator may
not award punitive damages or other damages not measured by the prevailing
party's actual damages. To the maximum extent practicable, an arbitration
proceeding under this agreement will be concluded within 180 days of the filing
of the dispute with the AAA. This arbitration clause will survive any
termination or expiration of this agreement and if any term, covenant, condition
or provision of this arbitration clause is found to be unlawful, invalid or
unenforceable, the remaining parts of the arbitration clause will not be
affected thereby and will remain fully enforceable.
11. Governing Law
This agreement will be governed by, and construed in accordance with, the
laws of the State of New York.
12. Notice
Notices and other writings will be delivered or mailed, postage prepaid,
o to the Trustee at Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000,
Attention: Corporate Trust Services,
o to Citibank at 0000 Xxxxxxxxx Xxxxx, X/X XX0000, Xxxxxxxxx, Xxxxxxxx 00000,
Attention: Xxxxxxx Xxxxxxx, with a copy to Xxxx X. Xxxxxxxx, Vice President &
General Counsel, Citibank, N.A., One Sansome St., 19th fl., Xxx Xxxxxxxxx,
Xxxxxxxxxx 00000, tel: (000) 000-0000, fax: (000) 000-0000, and
o to CRMSI or CitiMortgage at 0000 Xxxxxxxxxx Xxxxx, X'Xxxxxx, Xxxxxxxx 00000,
Attention: Xxxxxx X. Xxxxxxx
or to such other address as the Trustee, Citibank, CRMSI or CitiMortgage
subsequently specifies in writing to the other parties. Notices or other
writings will be effective only upon receipt.
13. Binding Effect
This agreement will be binding upon and will inure to the benefit of the
Trustee and Citibank and their respective successors and permitted assigns.
Concurrently with the appointment of a successor trustee as provided in section
8.08 of the Pooling Agreement, the Trustee, CRMSI, CitiMortgage and Citibank
will amend this agreement to make the successor trustee the successor to the
Trustee under this agreement.
SIGNATURES
U.S. BANK NATIONAL ASSOCIATION,
as Trustee under the Pooling Agreement
By:
---------------------------
Name: Xxxxxxxxx Xxxxxx
Title: Assistant Vice President
CITIBANK, N.A.,
as Mortgage Note Custodian
By:
---------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.
By:
---------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
CITIMORTGAGE, INC.
By:
---------------------------
Name: Xxxx Xxxx
Title: Chief Financial Officer
----------------------------------------------------
STANDARD TERMS FOR POOLING AND
SERVICING AGREEMENTS
----------------------------------------------------
Dated as of June 1, 2007
Citicorp Residential Mortgage Securities, Inc.
REMIC Pass-Through Certificates, Series 2007-2
================================================================================
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS...........................................................
Section 1.01 Definitions...........................................
Section 1.02 Fiscal Year...........................................
ARTICLE II CONVEYANCE OF TRUST FUND; ORIGINAL ISSUANCE OF CERTIFICATES..........
Section 2.01 Conveyance of Trust Fund..............................
Section 2.02 Acceptance by Trustee.................................
Section 2.03 Representations and Warranties of CRMSI and
CMI...................................................
Section 2.04 Substitution of Qualified Substitute
Mortgage Loans for Nonconforming Mortgage
Loans.................................................
Section 2.05 [Reserved]............................................
Section 2.06 Authentication of Certificates........................
Section 2.07 Permitted Activities..................................
Section 2.08 Additional Representations............................
ARTICLE III ADMINISTRATION AND SERVICING OF MORTGAGE LOANS......................
Section 3.01 Servicing.............................................
Section 3.02 Collection of Mortgage Payments.......................
Section 3.03 Subservicing Agreements...............................
Section 3.04 No Contractual Relationship...........................
Section 3.05 Assumption or Termination of Subservicing
Agreement.............................................
Section 3.06 Collection Account; Remittances to
Certificate Account...................................
Section 3.07 Periodic Interest Advances; Servicing
Advances..............................................
Section 3.08 Compensating Interest.................................
Section 3.09 Maintenance of Insurance..............................
Section 3.10 Due-on-Sale Clauses; Assumption and
Substitution..........................................
Section 3.11 Realization Upon Defaulted Mortgage Loans;
Workouts..............................................
Section 3.12 Trustee to Cooperate; Release of Files................
Section 3.13 Servicing Compensation................................
Section 3.14 Annual Statement of Compliance........................
Section 3.15 Assessments of Compliance and Attestation
Reports...............................................
Section 3.16 Access to Loan Documentation and Information..........
Section 3.17 Errors and Omissions Insurance........................
Section 3.18 [Reserved]............................................
Section 3.19 Prepayment Charges....................................
Section 3.20 Escrow Account........................................
Section 3.21 Refinancings of Mortgage Loans........................
ARTICLE IV ACCOUNTS AND DISTRIBUTIONS...........................................
Section 4.01 Collection of Money...................................
Section 4.02 Certificate Account...................................
Section 4.03 Investment of Accounts................................
Section 4.04 [Reserved]............................................
Section 4.05 Eligible Investments..................................
Section 4.06 Accounting and Directions.............................
Section 4.07 Reports by Certificate Administrator to
Holders...............................................
Section 4.08 Other Reports by Certificate Administrator
or Paying Agent.......................................
Section 4.09 Commission Filings....................................
Section 4.10 Amounts Not Distributed...............................
Section 4.11 Payment of Trust Expenses.............................
ARTICLE V THE CERTIFICATES......................................................
Section 5.01 The Certificates......................................
Section 5.02 Registration of Transfer and Exchange of
Certificates..........................................
Section 5.03 Mutilated, Destroyed, Lost or Stolen
Certificates..........................................
Section 5.04 Persons Deemed Owners.................................
Section 5.05 Access to List of Certificateholders' Names
and Addresses.........................................
Section 5.06 Definitive Certificates...............................
Section 5.07 Notices to Clearing Agency............................
ARTICLE VI CRMSI AND THE SERVICER...............................................
Section 6.01 Liability.............................................
Section 6.02 Merger or Consolidation, or Assumption of
Obligations...........................................
Section 6.03 Limitation on Liability...............................
Section 6.04 Servicer Not to Resign................................
Section 6.05 Maintenance of Office or Agency.......................
Section 6.06 Delegation of Duties..................................
ARTICLE VII SERVICER DEFAULT; RESIGNATION.......................................
Section 7.01 Servicing Events of Default...........................
ARTICLE VIII THE TRUSTEE........................................................
Section 8.01 Duties of the Trustee.................................
Section 8.02 Certain Matters Affecting the Trustee.................
Section 8.03 Trustee Not Liable for Certificates or
Mortgage Loans........................................
Section 8.04 Trustee May Own Certificates..........................
Section 8.05 Fees and Expenses Paid by Servicer....................
Section 8.06 Eligibility Requirements for Trustee..................
Section 8.07 Resignation or Removal of Trustee.....................
Section 8.08 Successor Trustee.....................................
Section 8.09 Merger or Consolidation of Trustee....................
Section 8.10 Appointment of Co-Trustee or Separate
Trustee...............................................
Section 8.11 Tax Returns...........................................
Section 8.12 Appointment of Authenticating Agent...................
Section 8.13 Appointment of Custodians.............................
ARTICLE IX TERMINATION..........................................................
Section 9.01 Termination upon Purchase by Servicer of
Mortgage Loans........................................
ARTICLE X GENERAL PROVISIONS....................................................
Section 10.01 Amendment.............................................
Section 10.02 Recordation of Agreement..............................
Section 10.03 Limitation on Rights of Certificateholders............
Section 10.04 Governing Law.........................................
Section 10.05 Intention of Parties..................................
Section 10.06 Notices...............................................
Section 10.07 Severability of Provisions............................
Section 10.08 Assignment............................................
Section 10.09 Certificates Nonassessable and Fully Paid.............
Section 10.10 No Usurious Intent....................................
Section 10.11 Counterparts..........................................
ARTICLE XI DEPOSITORIES.........................................................
Section 11.01 Depositories..........................................
APPENDIX 1 82
THESE STANDARD TERMS FOR POOLING AND SERVICING AGREEMENTS, dated as of
June 1, 2007 (the "Standard Terms Document"), declare the basic terms and
conditions upon which one or more series of pass-through certificates packaged
by Citicorp Residential Mortgage Securities, Inc. ("CRMSI") are to be issued,
authenticated and delivered from time to time pursuant to, for each such series,
a Pooling and Servicing Agreement (a "Pooling Agreement") between CRMSI as
depositor, CitiMortgage, Inc. ("CMI") as servicer, and the institution named
therein as trustee establishing such series.
This Standard Terms Document as incorporated in a Pooling Agreement
shall apply to the series of pass-through certificates established thereby to
the extent provided therein. Hereinafter, references to the "Pooling Agreement"
and the pass-through certificates executed and delivered thereunder and to terms
such as "this Agreement", "herein", "hereof" and words of similar import shall
refer only to a particular Pooling Agreement, including as and to the extent
incorporated therein this Standard Terms Document, and the series of
pass-through certificates established thereby.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
Whenever used in this Agreement, the following words and phrases, unless
otherwise specified in Article XII or unless the context otherwise requires,
shall have the following meanings, and the definitions of such terms are
applicable to the singular as well as the plural form of such terms and to the
masculine as well as to the feminine and neuter genders of such terms. Defined
terms used in this Standard Terms Document and not defined herein have the
respective meanings ascribed thereto in Article XII.
Accountant: A Person engaged in the practice of accounting who (except
when this Agreement provides that an Accountant must be Independent) may be
employed by or with the Depositor or an Affiliate thereof.
Act: The Securities Act of 1933, as amended.
Additional Form 10-D Disclosure: As defined in Section 4.09(b).
Additional Form 10-K Disclosure: As defined in Section 4.09(d).
Additional Prepayment Interest Shortfall: Without duplication of any
Equity Builder Prepayment Shortfall or Simple Interest Prepayment Shortfall, as
to any Mortgage Loan that was the subject of a Principal Prepayment applied
during a Prepayment Collection Period (other than a Principal Prepayment applied
as of the related Due Date), an amount equal to the difference between (a) one
month of interest on such Principal Prepayment at the Pass-Through Rate (giving
effect to the Civil Relief Act or Similar State Law, if applicable) that would
be due on the next Due Date for such Mortgage Loan and (b) the amount of
interest (adjusted to the Pass-Through Rate) actually received from the
Mortgagor in connection with such Principal Prepayment.
Additional Servicer: As defined in Section 3.03.
Additional Servicing Compensation: All amounts of the type described as
such in Section 3.13.
Adjustment Date: For an adjustable rate Mortgage Loan, each date on
which the Mortgage Note Rate is subject to adjustment, as provided in the
related Mortgage Note.
Affiliate: For any specified Person, any other Person controlling or
controlled by or under common control with such specified Person. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
Aggregate Current Pool Balance: On any date of determination, the Pool
Balance as of the end of the most recently ended Collection Period.
Aggregate Initial Pool Balance: The Pool Balance as of the Cut-Off Date.
Amount Held for Future Distribution: For any Collection Period, any
collections on any Mortgage Loans received during such Collection Period (or the
related Prepayment Collection Period, as the case may be) the that are not
required to be remitted to the Certificate Account on the related Distribution
Date.
Applied Loss Amount: For any Distribution Date, any excess of (x) the
Certificate Balance, after giving effect to distributions of principal to the
Class A Certificates and Class M Certificates on such date (and after giving
effect to any increase in Class M Subclass Principal Balances as a result of Net
Subsequent Recoveries) but prior to allocation pursuant to Section 13.02, over
(y) the Aggregate Current Pool Balance as of the end of the related Collection
Period.
Appraisal: For any Mortgage Loan, the appraisal conducted in connection
with the origination of such Mortgage Loan, whether conducted upon the purchase
of the related Mortgaged Property or in connection with a refinancing.
Authenticating Agent: Any Authenticating Agent appointed pursuant to
Section 8.12. The Authenticating Agent may be an Affiliate of the Depositor.
Authorized Officer: With respect to the Servicer or the Depositor, the
Chairman, the President, any Executive Vice President, Senior Vice President,
Vice President, Controller, Assistant Controller, Secretary, Assistant
Secretary, Treasurer or Assistant Treasurer, or any other natural person
designated in an Officer's Certificate signed by any of the foregoing officers
and furnished to the Trustee.
Bankruptcy Code: The United States Bankruptcy Code of 1978, as amended.
Beneficial Owner: With respect to a Certificate held by a Clearing
Agency, the Person who is the beneficial owner of such Certificate as reflected
on the books of such Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly or as an Indirect Participant, in
accordance with the rules of such Clearing Agency).
Bi-Weekly Interest Advanceable Amount: For a Bi-Weekly Loan and a
Collection Period in which only two (rather than three) Scheduled Payments in
respect of such loan were automatically deductible from the related Mortgagor's
personal bank account, an amount equal to the excess (if any) of (x) the amount
of interest that accrued on such Bi-Weekly Loan during such Collection Period
over (y) the sum of (1) the aggregate of the interest portions of those
Scheduled Payments that were automatically deductible during such Collection
Period and (2) the Bi-Weekly Interest Holdover Applied Amount (if any) for such
Bi-Weekly Loan and such Collection Period.
Bi-Weekly Interest Holdover Amount: For a Bi-Weekly Loan and a
Collection Period in which three (rather than only two) Scheduled Payments in
respect of such loan were automatically deductible from the related Mortgagor's
personal bank account, the excess of (x) the amount of interest received during
such Collection Period on such Bi-Weekly Loan (net of the Servicing Fee in
respect of such Bi-Weekly Loan for such Collection Period) over (y) the portion
of such amount that represents 30 days of accrued interest on such Bi-Weekly
Loan; provided that, in the case of any Bi-Weekly Loan and the Collection Period
during which the final Due Date for that loan occurs, there shall in no event be
any Bi-Weekly Interest Holdover Amount for such loan and such Collection Period.
For the avoidance of doubt, each Bi-Weekly Interest Holdover Amount for a
Bi-Weekly Loan shall be retained in the Collection Account, but each Bi-Weekly
Interest Holdover Applied Amount for such loan that is funded by a portion of
such Bi-Weekly Interest Holdover Amount shall be remitted to the Certificate
Account, in accordance with Section 3.06(e), on the Distribution Date related to
the Collection Period for which such Bi-Weekly Interest Holdover Applied Amount
constitutes part of the Monthly Deposit Amount.
Bi-Weekly Interest Holdover Applied Amount: For a Bi-Weekly Loan and a
Collection Period in which only two (rather than three) Scheduled Payments in
respect of such loan were automatically deductible from the related Mortgagor's
personal bank account, the lesser of (1) the excess (if any) of (x) the amount
of interest that accrued on such Bi-Weekly Loan during such Collection Period
over (y) the aggregate of the interest portions of the Scheduled Payments that
were automatically deductible during such Collection Period and (2) the
remaining portion (if any) of the Bi-Weekly Interest Holdover Amount for such
loan related to the most recent preceding Collection Period during which three
(rather than only two) Scheduled Payments in respect of such loan were
automatically deductible from the related Mortgagor's personal bank account.
Bi-Weekly Loan: An Equity Builder Loan with respect to which the related
Mortgagor has authorized the Originator to cause the Servicer automatically to
deduct from such Mortgagor's personal bank account on a bi-weekly basis certain
periodic payments (as specified in the related Equity Builder Agreement).
Business Day: Any day other than (x) a Saturday, a Sunday or a day on
which banking institutions in New York, New York or in the cities where the
Trustee, any Paying Agent and the Servicer are located are authorized or
obligated by law or executive order to be closed or (y) only with respect to a
Distribution Date and if there are Book-Entry Certificates, a day on which the
relevant Clearing Agency is closed.
Certificate: Any certificate or residual certificate identified as such
in Article XII.
Certificate Account: The account or accounts created and maintained
pursuant to Section 4.02, each such account to be held in trust for the benefit
of Certificateholders, in the name of the Trustee. The term Certificate Account
shall be deemed to include an Alternative Certificate Account (as defined in
Section 11.01).
Certificate Balance: As of any date, the aggregate of the Principal
Balances of all Certificates.
Certificate Rate: For any Class or Subclass of Certificates, the rate
per annum at which interest accrues on Certificates of such Class or such
Subclass, as specified in Article XII.
Certificate Register and Certificate Registrar: The register maintained
pursuant to Section 5.02 and the Certificate Registrar identified in Article
XII.
Certificateholder or Holder: The Person in whose name a Certificate is
registered in the Certificate Register.
Certification: As defined in Section 4.09(d).
Civil Relief Act: The Servicemembers Civil Relief Act.
Civil Relief Shortfall: For any Collection Period and any Mortgage Loan
for which there has been a reduction in the amount of interest collectible for
such Collection Period as a result of the Civil Relief Act or Similar State Law,
the reduction in the amount of interest collectible on such Mortgage Loan during
such Collection Period as a result of such reduction.
Civil Relief Shortfall Amount: For any Distribution Date and any
interest-bearing Class or Subclass of Certificates, the pro rata share allocated
thereto, based on the amount of interest accrued thereon at the applicable
Certificate Rate during the related Interest Accrual Period, of the aggregate of
the Civil Relief Shortfalls for all Mortgage Loans for the related Collection
Period.
Class: With respect to the Certificates, any group of Certificates
designated as a Class in Article XII and with respect to Residual Certificates,
all Residual Certificates having the same Class designation.
Class A Certificateholder: A registered holder of a Class A Certificate.
Class A Certificate: A Certificate of any Class or Subclass designated
as a Class A Certificate in Article XII.
Class A Interest Amount: For any Distribution Date and for a particular
Group, the sum of the related Class A Subclass Interest Amounts for such
Distribution Date.
Class A Interest Shortfall Amount: For a Distribution Date, the sum of
all Class A Subclass Interest Shortfall Amounts for such date.
Class A Principal Balance: For any date, an amount equal to the sum of
the Class A Subclass Principal Balances.
Class A Subclass Interest Amount: As to any Distribution Date and each
Class A Subclass (other than a Class A Principal-Only Subclass), (i) the amount
of interest accrued during the related Interest Accrual Period on the Class A
Subclass Principal Balance (or in the case of any interest-only Subclass, the
notional amount) of such Class A Subclass at the lesser of (x) the applicable
Certificate Rate and (y) the Net WAC Rate for such Distribution Date, minus (ii)
the sum of (x) any Unsupported Prepayment Interest Shortfall allocated to such
Class A Subclass for such Distribution Date and (y) any Civil Relief Shortfall
Amount allocated to such Class A Subclass for such Distribution Date.
Class A Subclass Interest Shortfall Amount: As to any Distribution Date
and each Class A Subclass in a particular Group (other than a Class A
Principal-Only Subclass), any amount by which the Class A Subclass Interest
Amount of such Class A Subclass for such Distribution Date exceeds the amount
distributed in respect of such Class A Subclass on such Distribution Date
pursuant to clause 1.a of Section 13.01(b).
Class A Subclass Principal Balance: As to the first Distribution Date
and each Class A Subclass in a particular Group, the Initial Principal Balance
of such Class A Subclass as set forth in Section 12.01(a). As of any subsequent
Distribution Date, such Initial Principal Balance minus the sum of all amounts
previously distributed in respect of such Class A Subclass on prior Distribution
Dates pursuant to clause 1.c of Section 13.01(b).
Class A Unpaid Interest Shortfall: As to any Distribution Date and for a
particular Group, an amount equal to the sum of the related Class A Subclass
Interest Shortfall Amounts.
Class M Certificateholder: A registered holder of a Class M Certificate.
Class M Interest Amount: For any Distribution Date, the sum of the Class
M Subclass Interest Amounts for such Distribution Date.
Class M Principal Balance: An amount equal to the sum of all Class M
Subclass Principal Balances.
Class M Subclass Applied Losses: For any Distribution Date and any Class
M Subclass, the aggregate amount of all Applied Loss Amounts allocated to such
Class M Subclass on all prior Distribution Dates.
Class M Subclass Interest Amount: As to any Distribution Date and any
Class M Subclass, (i) the amount of interest accrued during the related Interest
Accrual Period on the Class M Subclass Principal Balance of such Class M
Subclass at the lesser of (x) the applicable Certificate Rate and (y) the Net
WAC Rate for such Distribution Date, minus (ii) the sum of (x) any Unsupported
Prepayment Interest Shortfall allocated to such Class M Subclass for such
Distribution Date and (y) any Civil Relief Shortfall Amount allocated to such
Class M Subclass for such Distribution Date.
Class M Subclass Interest Shortfall Amount: As to any Distribution Date
and any Class M Subclass, any amount by which the Class M Subclass Interest
Amount for such Class M Subclass for such Distribution Date exceeds the amount
distributed in respect of such Class M Subclass on such Distribution Date
pursuant to clause 1.b of Section 13.01(b).
Class M Subclass Loss Amount: For any Distribution Date and any Class M
Subclass, (a) the aggregate amount of all Applied Loss Amounts allocated to such
Class M Subclass on all prior Distribution Dates minus (b) the sum of (i) the
aggregate amount of all distributions to such Class M Subclass in reduction of
such Class M Subclass Loss Amount on all prior Distribution Dates pursuant to
clause 1.e of Section 13.01(b) and (ii) the cumulative amount of any Net
Subsequent Recoveries allocated to such Class M Subclass.
Class M Subclass Principal Balance: As to the first Distribution Date
and any Class M Subclass, the Initial Principal Balance of such Class M Subclass
as set forth in Section 12.01(a). As of any subsequent Distribution Date, the
lesser of (a) such Initial Principal Balance minus (i) the sum of (A) all
amounts previously distributed to holders thereof in reduction of Principal
Balance and (B) the Class M Subclass Applied Losses for such Class M Subclass,
plus (ii) any Net Subsequent Recoveries allocated to such Class for previous
Distribution Dates, and (b) the Aggregate Current Pool Balance minus the sum of
the Class A Principal Balance and the Class M Subclass Principal Balances of all
Class M Subclasses with lower numerical designations, each as of the immediately
preceding Distribution Date (after taking into account distributions in
reduction of such Class M Subclass Principal Balances, increases in such Class M
Subclass Principal Balances as a result of Net Subsequent Recoveries, and the
allocation of any Applied Loss Amounts on such date).
Class M Unpaid Interest Shortfall: As to any Distribution Date, the sum
of the Class M Subclass Interest Shortfall Amounts.
Class R Certificate: Any Residual Certificate designated as such in
Article XII.
Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act and the regulations of the
Commission thereunder. Unless otherwise specified in Article XII, the initial
Clearing Agency is The Depository Trust Company.
Clearing Agency Participant: A broker, dealer, bank or other financial
institution or other person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
Code: The Internal Revenue Code of 1986, as it may be amended from time
to time, any successor statutes thereto, and applicable U.S. Department of the
Treasury temporary or final regulations issued pursuant thereto.
Collection Account: As defined in Section 3.06.
Collection Period: For a particular Distribution Date, the period
commencing with the opening of business of the first day of the preceding
calendar month and ending at the close of business on the last day of such
preceding calendar month.
Commission: The Securities and Exchange Commission.
Compensating Interest: As defined in Section 3.08.
Constituent REMICs: Each of the one or more segregated asset pools
designated in Article XII as a REMIC within the Trust Fund.
Corporate Trust Office: The principal office of the Trustee at which at
any particular time its corporate trust business shall be administered, which
office on the date hereof is located at the address set forth in Article XII.
CRMSI: Citicorp Residential Mortgage Securities, Inc., a corporation
organized and existing under the laws of the State of Delaware, or its
successors in interest.
Cumulative Loss Percentage: As of any date, the percentage equivalent of
Cumulative Realized Losses divided by the Aggregate Initial Pool Balance.
Cumulative Realized Losses: As of any date, the aggregate amount of
Realized Losses on all Mortgage Loans for all Prepayment Collection Periods
ending prior to such date (reduced by the aggregate amount of Subsequent
Recoveries received since the Cut-Off Date through the last day of the related
Prepayment Collection Period).
Current Interest: For any Distribution Date, the sum of the Class A
Interest Amount for all Groups and the Class M Interest Amount.
Deficiency Amount: For any Distribution Date, any excess of (x) the
Targeted Level over (y) the Overcollateralization Amount, taking into account
the reduction of the Certificate Balance by application of Principal Proceeds
but prior to applying any Extra Principal Distribution Amount or Applied Loss
Amount.
Deficient Valuation: For any Mortgage Loan, a valuation by a court of
competent jurisdiction of the Mortgaged Property in an amount less than the
then-outstanding indebtedness under the Mortgage Loan, or any reduction in the
amount of principal to be paid in connection with any Scheduled Payment that
results in a permanent forgiveness of principal, which valuation or reduction
results from a proceeding under the Bankruptcy Code or any other similar state
law.
Definitive Securities: Any Class or Subclass of Certificates or the
Residual Certificates issued in definitive, fully registered form, either upon
initial issuance or in accordance with the provisions of Section 5.06.
Delinquent: A Mortgage Loan is "Delinquent" if (a) in any month, the
scheduled monthly payment due thereon under the terms of the related Mortgage
Note (after adjustment to the due amount of such payment for (i) application of
prior Scheduled Payments on the loan to interest and principal pursuant to the
simple interest method employed by the Servicer, (ii) any partial Principal
Prepayments and (iii) Deficient Valuations occurring prior to the related
scheduled monthly due date but before any adjustment other than Deficient
Valuations by reason of any bankruptcy, or similar proceeding or any moratorium
or similar waiver or grace period) is not received from the Mortgagor by the
close of business on the scheduled monthly due date specified in such Mortgage
Note and (b) such past-due payment remains unpaid as of the close of business on
such scheduled monthly due date in the following month; provided that, in the
case of a Semi-Monthly Loan, a scheduled monthly payment due under the terms of
the related Mortgage Note is deemed for this purpose not to have been paid as of
the related scheduled monthly due date specified in the related Mortgage Note
if, as of close of business on such date, either of the two semi-monthly
payments most recently due to have been deducted automatically from the related
Mortgagor's personal bank account (under the terms of the related Equity Builder
Agreement) have not been so deducted; and provided further that, in the case of
a Bi-Weekly Loan, a scheduled monthly payment due under the terms of the related
Mortgage Note is deemed for this purpose not to have been paid as of the related
scheduled monthly due date specified in the related Mortgage Note if, as of
close of business on such date, either of the two bi-weekly payments most
recently due to have been deducted automatically from the related Mortgagor's
personal bank account (under the terms of the related Equity Builder Agreement)
have not been so deducted. A Mortgage Loan is "30 days Delinquent" if a
scheduled monthly payment is not received (or, in the case of a Semi-Monthly
Loan or Bi-Weekly Loan, is deemed not to have been received) by the close of
business on the corresponding day of the second month following the month of the
related scheduled monthly due date. A Mortgage Loan is "60 days Delinquent" if a
scheduled monthly payment is not received (or, in the case of a Semi-Monthly
Loan or Bi-Weekly Loan, is deemed not to have been received) by the close of
business on the corresponding day of the third month following the month of the
related scheduled monthly due date, and similarly for "90 days Delinquent" and
so on.
Deposit Date: The Business Day preceding each Distribution Date.
Depositor: CRMSI, or its successors in interest.
Depositor Order: A written order or request signed in the name of the
Depositor by an Authorized Officer.
Depository: The bank or banks (which may be Citibank, N.A., Citibank
(Delaware) or Citibank (New York State)) or savings and loan association or
associations or trust company or companies (which may be the Trustee or which
may be, directly or indirectly, controlled by or under common control with the
Depositor) at which the Collection Account, Certificate Account and Escrow
Account are established or maintained pursuant to Section 4.02, 3.19 or 3.20.
Each Depository must meet the requirements set forth in Section 11.01.
Disqualified Organization: As defined in Section 5.02.
Distribution Date Statement: The statement required to be delivered
pursuant to Section 4.07(a).
Due Date: For a Mortgage Loan, the day of each calendar month on which a
Scheduled Payment is due; provided that, in the case of a Bi-Weekly Loan or a
Semi-Monthly Loan, "Due Date" shall refer to each day of each calendar month on
which a periodic payment is automatically deductible from the related
Mortgagor's personal bank account in accordance with the terms of the related
Equity Builder Agreement.
Early Interest Holdover Amount: Any interest received during a
Collection Period on a Mortgage Loan in respect of a Due Date subsequent to such
Collection Period (net of the Servicing Fee for the Collection Period in which
such early payment of interest was received). In accordance with Section
3.06(c)(1), the Servicer shall deposit each Early Interest Holdover Amount into
the Collection Account within two Business Days of the collection of such
amount. Each Early Interest Holdover Amount shall constitute part of the Monthly
Deposit Amount for the Collection Period in which occurs the Due Date on which
such Early Interest Holdover Amount would have become due (if the related
Mortgagor had not made an early payment of such amount during a prior Collection
Period). For the avoidance of doubt, each Early Interest Holdover Amount shall
be retained in the Collection Account until the Distribution Date related to the
Collection Period for which such amount constitutes part of the Monthly Deposit
Amount (at which time such amount shall be remitted to the Certificate Account,
as part of such Monthly Deposit Amount, in accordance with Section 3.06(e)).
XXXXX: As defined in Section 4.09(b).
Eligible Account: Either (a) a segregated account or accounts maintained
at Citibank, N.A. or a Citibank banking affiliate, provided that the short-term
unsecured debt obligations of Citibank, N.A. or the Citibank banking affiliate
are rated at least "A-1+" by S&P if S&P is a Rating Agency, "F-l" by Fitch if
Fitch is a Rating Agency, and "P-1" by Moody's if Xxxxx'x is a Rating Agency, or
(b) a segregated account or accounts maintained with an institution (i) whose
deposits are insured by the FDIC, (ii) the unsecured and uncollateralized debt
obligations of which are rated at least "AA" by S&P if S&P is a Rating Agency,
"AA" by Fitch if Fitch is a Rating Agency, and "Aa" by Moody's if Xxxxx'x is a
Rating Agency, (iii) that has a short term rating of at least "A-1+" by S&P if
S&P is a Rating Agency, "F-1" by Fitch if Fitch is a Rating Agency, and "P-1" by
Moody's if Xxxxx'x is a Rating Agency, and (iv) that is either (A) a federal
savings and loan association duly organized, validly existing and in good
standing under the federal banking laws, (B) an institution duly organized,
validly existing and in good standing under the applicable banking laws of any
state, (C) a national banking association duly organized, validly existing and
in good standing under the federal banking laws or (D) a principal subsidiary of
a bank holding company, or (c) a trust account maintained with the trust
department of a federal or state chartered depository institution or of a trust
company, having capital and surplus of not less than $50,000,000, acting in its
fiduciary capacity. Any Eligible Account maintained with the Trustee shall
conform to the preceding clause (c).
Eligible Investments: As defined in Section 4.05.
Equity Builder Agreement: For any Equity Builder Loan, the agreement
between the Originator and the related Mortgagor, pursuant to which the
Mortgagor is enrolled in the Equity Builder Program.
Equity Builder Loan: As of any date of determination, a Mortgage Loan
with respect to which the related Mortgagor is enrolled in the Equity Builder
Program on such date of determination.
Equity Builder Prepayment Shortfall: With respect to any Bi-Weekly Loan
or Semi-Monthly Loan and any Prepayment Collection Period, an amount equal to
the excess of (x) the scheduled amount of interest that would be paid on such
loan during the corresponding Collection Period if the related Mortgagor made,
during such Collection Period, only the monthly scheduled payment on such loan
that is required under the terms of the related Mortgage Note (and if such
payment was made on the due date therefor during such Collection Period) over
(y) the aggregate of the interest portions of the bi-weekly payments or
semi-monthly payments, as the case may be, that are automatically deductible
from such Mortgagor's personal bank account during such Prepayment Collection
Period pursuant to the related Equity Builder Agreement, but not including any
portion of such amount that constitutes a Bi-Weekly Advanceable Amount for the
corresponding Collection Period.
Equity Builder Program: A program of the Originator, pursuant which an
enrolled mortgagor authorizes the Originator to cause the related servicer to
deduct automatically from the mortgagor's personal bank account, on the monthly
due date or on either a bi-weekly or semi-monthly basis, level periodic payments
of principal and interest on the mortgagor's mortgage loan, which payments are
calculated based on the scheduled monthly payment due under the terms of the
related mortgage note. Mortgagors who are eligible for the Equity Builder
Program have the option to enroll (and, subsequently, to disenroll) in the
program at any time, and if an enrolled mortgagor subsequently becomes
ineligible, he or she may be disenrolled by the Originator from the program. Any
previously enrolled mortgagor who chose to have bi-weekly or semi-monthly
payments automatically deducted from his or her bank account and who disenrolls
(or is disenrolled) from the Equity Builder Program will, subsequent to such
disenrollment, be required to make the scheduled monthly payments due under the
terms of the related mortgage note but will not be required to make any such
bi-weekly or semi-monthly payments that had been automatically deductible from
the mortgagor's bank account while he or she was enrolled in the program.
ERISA: The Employee Retirement Income Security Act of 1974, as amended
from time to time and any applicable rule, regulation or order promulgated
thereunder.
ERISA Prohibited Holder: As defined in Section 5.02.
Escrow Account: The account, if any, created and maintained pursuant to
Section 3.20.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Extra Principal Distribution Amount: For any Distribution Date, the
lesser of (x) Monthly Excess Interest and (y) the Deficiency Amount.
FDIC: The Federal Deposit Insurance Corporation.
FHLMC: The Federal Home Loan Mortgage Corporation.
Fitch: Fitch Ratings, or its successors.
Foreclosure Profits: As to any Distribution Date, the sum of (1) any
excess of (a) Net Liquidation Proceeds for each Mortgage Loan that became a
Liquidated Loan during the related Collection Period over (b) the sum of the
Unpaid Loan Balance of each such Liquidated Loan plus accrued and unpaid
interest at the applicable Mortgage Note Rate on such Unpaid Loan Balance from
the Due Date to which interest was last paid by the Mortgagor (or, in the case
of a Liquidated Loan that had been an REO Mortgage Loan, from the Due Date to
which interest was last deemed to have been paid to the Due Date in the month in
which such Mortgage Loan became a Liquidated Loan) and (2) any excess of (a) Net
Subsequent Recoveries during such related Collection Period for each Mortgage
Loan that became a Liquidated Loan during a Collection Period prior to such
related Collection Period over (b) the Unpaid Loan Balance of each such
Liquidated Loan plus accrued and unpaid interest at the applicable Mortgage Note
Rate on such Unpaid Loan Balance from the Due Date to which interest was last
paid by the Mortgagor (or, in the case of a Liquidated Loan that had been an REO
Mortgage Loan, from the Due Date to which interest was last deemed to have been
paid to the Due Date in the month in which such Mortgage Loan became a
Liquidated Loan) after giving effect to any Net Liquidation Proceeds for such
Liquidated Loan and any Net Subsequent Recoveries for such Liquidated Loan that
were received during a Collection Period prior to such related Collection
Period. (References in this definition to either Net Liquidation Proceeds or Net
Subsequent Recoveries shall refer to such term without giving effect to clause
(ii) in the first sentence of the definition of such term.)
Form 8-K Disclosure Information: As defined in Section 4.09(e).
GIC: A guaranteed investment contract or surety bond.
Gross Margin: The percentage set forth in the Mortgage Note for an
adjustable rate Mortgage which is to be added to the applicable index to
determine the Mortgage Note Rate on each Adjustment Date.
Group: For Class A Certificates, those Classes or Subclasses designated
in Article XII as being part of a particular "Group" of Class A Certificates and
as being related to a particular Pool. Group 1 Class A Certificates shall be
related to Pool 1, Group 2 Class A Certificates shall be related to Pool 2, and
so on for additional Groups and Pools.
Holder: Has the same meaning as "Certificateholder".
Independent: When used with respect to any specified Person, means such
a Person who is "independent" within the meaning of Rule 2-01(b) of the
Commission's Regulation S-X under the Exchange Act.
Indirect Participant: A broker, dealer, bank or other financial
institution or other person who acts through a Clearing Agency Participant to
effect book-entry transfers through the Clearing Agency and pledges of
securities deposited with the Clearing Agency.
Initial Principal Balance: For any Class or Subclass of Certificates,
the amount specified in Article XII, and for any Certificate, the amount
specified thereon as the Initial Principal Balance.
Insurance Proceeds: Proceeds paid in respect of a Mortgage Loan pursuant
to any Primary Mortgage Insurance Certificates, amounts paid pursuant to hazard
insurance policies to the extent not applied to restore the related Mortgaged
Property or released to the Mortgagor in accordance with the Servicer's normal
servicing procedures, and amounts paid pursuant to any other insurance policy or
bond relating to the Mortgage Loan or the servicing thereof.
Interest Proceeds: For a Distribution Date, the sum (without
duplication) of (a) all interest received during the related Collection Period
on the Mortgage Loans in respect of Due Dates during or prior to the related
Collection Period (net of the Servicing Fee for the related Collection Period),
(b) all Early Interest Holdover Amounts that constitute part of the Monthly
Deposit Amount for the related Collection Period, (c) all Bi-Weekly Interest
Holdover Applied Amounts for such Collection Period, (d) all Compensating
Interest paid by the Servicer for the related Collection Period, (e) the
interest portion of any payment made during the related Prepayment Collection
Period in connection with the repurchase of a Mortgage Loan pursuant to Section
2.02 or 2.03(a), (f) the interest portion of Net Liquidation Proceeds received
in the related Prepayment Collection Period, (g) the interest portion of Net
Subsequent Recoveries received in the related Prepayment Collection Period, (h)
all Periodic Interest Advances made for the related Collection Period and (i)
the interest portion of any payment made on such Distribution Date in connection
with the purchase of the Mortgage Loans pursuant to the Right to Purchase under
Section 9.01(a).
Investment Account: As and to the extent specified in Article XII, each
account or any portion of any thereof which consists of cash or Eligible
Investments.
Investment Income: Any and all investment income and gains, net of any
losses, actually received on the investment of funds on deposit in a particular
Investment Account.
Issue Date: The date on which Certificates are first executed,
authenticated and delivered, as specified in Article XII. For the Avoidance of
doubt, unless otherwise specified in Article XII, the Issue Date shall be the
Closing Date as defined in Section 12.02.
Last Scheduled Distribution Date: For each Class or Subclass of
Certificates or Certificates, the date specified in Article XII.
Liquidated Loan: A Mortgage Loan (including an REO Property) with
respect to which the Servicer determines that all Liquidation Proceeds which it
expects to recover have been recovered or a Mortgage Loan for which the related
Mortgaged Property is retained or sold by the Mortgagor and for which the
Servicer has released the Mortgage as a result of a determination by the
Servicer that the potential Liquidation Expenses with respect to such Mortgage
Loan would exceed the amount by which any payment made by the Mortgagor is less
than the outstanding principal balance of such Mortgage Loan plus accrued and
unpaid interest thereon to the date on which such Mortgage Loan became an REO
Mortgage Loan.
Liquidation Expenses: For any Liquidated Loan, expenses paid or incurred
by or for the account of the Servicer or the Trust Fund for (a) Property
Protection Expenses, (b) property sales expenses, (c) foreclosure costs,
including court costs and reasonable attorneys' fees, (d) similar expenses
reasonably paid or incurred in connection with the liquidation of such
Liquidated Loan and (e) any tax imposed on the Trust Fund with respect to a
Liquidated Loan or property received by deed in lieu of foreclosure.
Liquidation Proceeds: For any Liquidated Loan, the amounts received by
the Servicer in connection with the liquidation of such Liquidated Loan, whether
through judicial or non-judicial foreclosure, proceeds of insurance policies,
condemnation proceeds or otherwise, including payments received from the
Mortgagor in respect of such Liquidated Loan, other than amounts required to be
paid to the Mortgagor pursuant to the terms of such Liquidated Loan or to be
applied otherwise pursuant to law.
Loan Balance: For any Mortgage Loan as of any date, the outstanding
principal balance thereof as of the close of business on the Cut-Off Date, less
all scheduled principal payments received during all prior Collection Periods,
and all unscheduled principal payments received during all prior Prepayment
Collection Periods, on such Mortgage Loan, without regard to any adjustments
thereof in connection with Mortgagor bankruptcies (other than a Deficient
Valuation).
Loan Repurchase Price: As defined in Section 2.02.
Loan-to-Value Ratio: As of any date, (a) for a Mortgage Loan secured by
a Senior Lien, the percentage equivalent of (x) the Unpaid Loan Balance divided
by (y) the Original Value and (b) for a Second Mortgage Loan, the percentage
equivalent of (x) the sum of the Unpaid Loan Balance of the Second Mortgage Loan
and the remaining principal balance of all Senior Liens on the related Mortgaged
Property as of such date, divided by (y) the Original Value.
Lost Note Affidavit: For any Mortgage Loan for which the original
Mortgage Note has been permanently lost, misplaced or destroyed and has not been
replaced, an affidavit of the Originator or an Affiliate of the Originator
certifying that the original Mortgage Note has been lost, misplaced or destroyed
(attaching a copy of such Mortgage Note) and indemnifying the Trust Fund against
any loss, cost or liability resulting from the failure to deliver such original
Mortgage Note.
Maximum Compensating Interest Amount: For any Distribution Date, the
lesser of (a) the aggregate amount of the Servicing Fee actually received on the
Mortgage Loans for such Distribution Date (but not including any Servicing Fee
received because of a Periodic Interest Advance for the related Collection
Period) and (b) one-half of the sum of the Daily Servicing Fee Accrual Amounts
for each Mortgage Loan for each day during the related Collection Period. For
the avoidance of doubt, in accordance with clause (a) of this definition, the
Servicer will not advance any Servicing Fee or any portion thereof to reduce
Prepayment Interest Shortfalls pursuant to Section 3.08.
Maximum Note Rate: The maximum rate of interest set forth in the
Mortgage Note relating to an adjustable rate Mortgage Loan.
MERS: Mortgage Electronic Registration Systems, Inc. and its successors
in interest.
Minimum Note Rate: The minimum rate of interest set forth in the
Mortgage Note relating to an adjustable rate Mortgage Loan.
Monthly Deposit Amount: As defined in Section 3.06(c).
Monthly Excess Interest: For any Distribution Date, any excess of (x)
Interest Proceeds over (y) the sum of Current Interest and any Class A Subclass
Interest Shortfalls.
Moody's: Xxxxx'x Investors Service, Inc.
Mortgage: For any Mortgage Loan, the mortgage, deed of trust or other
security instrument creating a first lien on and an interest in real property
securing a Mortgage Note.
Mortgage Documents: Any and all documents (including the Mortgage Note
to be held and maintained by the Mortgage Note Custodian, on behalf of the
Trustee, and the Other Mortgage Documents to be held and maintained by the
Servicer, on behalf of the Trustee) contained in the Mortgage Files.
Mortgage File: The Mortgage Documents listed in Section 2.01 that are
required to be delivered to either the Mortgage Note Custodian or the Servicer
pertaining to a particular Mortgage Loan and any additional documents required
to be added to such documents pursuant to this Agreement.
Mortgage Loan: At any time, the indebtedness of a Mortgagor evidenced by
a Mortgage Note which is secured by real property and which is sold and assigned
to the Trustee and held at such time in the Trust Fund pursuant to this
Agreement, the Mortgage Loans originally so held being identified in Exhibit B.
Mortgage Loan Schedule: The list of Mortgage Loans transferred to the
Trustee as part of the Trust Fund, the original list being attached hereto as
Exhibit B.
Mortgage Note: For a Mortgage Loan, the promissory note or other
evidence of indebtedness of the Mortgagor.
Mortgage Note Custodial Agreement: The Mortgage Note Custodial Agreement
substantially in the form set forth in Exhibit F between the Mortgage Note
Custodian, the Depositor, the Servicer and the Trustee, as the same may be
amended or modified from time to time.
Mortgage Note Custodian: The person identified in Article XII or its
successors in interest and named pursuant to the Mortgage Note Custodial
Agreement. The Mortgage Note Custodian may be the Trustee, any Affiliate of the
Trustee or the Depositor or an independent entity; provided that if the Mortgage
Note Custodian's long-term senior debt is (a) rated below BBB, or is not rated,
by Fitch if Fitch is a rating agency, (b) rated below A2, or is not rated, by
Moody's if Xxxxx'x is a rating agency, or (c) rated below A+, or is not rated,
by S&P if S&P is a rating agency, then the Trustee shall, reasonably promptly
after being notified by CMI, CRMSI or a rating agency that the Mortgage Note
Custodian no longer has the required ratings, remove the Mortgage Note Custodian
and appoint a successor Mortgage Note Custodian, as described herein. The
Trustee may at any time remove the initial or any successor Mortgage Note
Custodian, and enter into a Mortgage Note Custodial Agreement substantially in
the form of Exhibit F with a successor Mortgage Note Custodian. The Mortgage
Note Custodial Agreement may provide that the successor Mortgage Note Custodian
will conduct the review of each Mortgage Note required under Section 2.02,
except that if the successor Mortgage Note Custodian is CRMSI or an affiliate of
CRMSI, the Trustee may conduct the review.
Mortgage Note Rate: For a Mortgage Loan, the annual rate per annum at
which interest accrues on such Mortgage Loan.
Mortgaged Property: Any real property subject to a Mortgage.
Mortgagor: The obligor or obligors on a Mortgage Note.
Net Liquidation Proceeds: For any period and for any Liquidated Loan,
the aggregate amount of Liquidation Proceeds, net of (i) related Liquidation
Expenses and related unreimbursed Periodic Interest Advances and unreimbursed
Servicing Advances, received by the Servicer or deposited in the Collection
Account, as the case may be, as proceeds of such Mortgage Loan, and (ii)
Foreclosure Profits with respect to such Net Liquidation Proceeds. Net
Liquidation Proceeds shall be allocated first to accrued and unpaid interest on
the related Mortgage Loan and then to the unpaid principal balance thereof.
Net Periodic Interest Advances: For any period, the amount (which may be
negative) obtained by subtracting the amount of any reimbursements of Periodic
Interest Advances received in such period from the aggregate amount of Periodic
Interest Advances made in such period.
Net Servicing Advances: For any period, the amount (which may be
negative) obtained by subtracting the amount of any reimbursements of Servicing
Advances received in such period from the aggregate amount of Servicing Advances
made in such period.
Net Subsequent Recoveries: For any Prepayment Collection Period and for
any Liquidated Loan, the aggregate amount of Subsequent Recoveries, net of (i)
related Liquidation Expenses and related unreimbursed Periodic Interest Advances
and unreimbursed Servicing Advances (in each case, after giving effect to any
Liquidation Proceeds and previous Subsequent Recoveries applied to the
reimbursement of such expenses or advances), received by the Servicer or
deposited in the Collection Account, as the case may be, as proceeds of such
Mortgage Loan, and (ii) Foreclosure Profits with respect to such Net Subsequent
Recoveries. Net Subsequent Recoveries shall be allocated first to accrued and
unpaid interest on the related Mortgage Loan and then to the unpaid principal
balance thereof.
Net WAC Rate: As defined in Section 12.02.
Nonrecoverable Advance: Any portion of a Periodic Interest Advance or
Servicing Advance previously made which has not been previously reimbursed to
the Servicer and which, in the good faith judgment of the Servicer, would not be
ultimately recoverable from Liquidation Proceeds or other recoveries in respect
of the related Mortgage Loan.
Non-Transferred Interest Amount: With respect to any Mortgage Loan, any
payment or collection received or receivable in respect of interest that accrued
on such Mortgage Loan prior to the scheduled monthly due date of such Mortgage
Loan (as specified in the related Mortgage Note) in the month preceding the
month of the Cut-Off Date.
Officer's Certificate: A certificate signed by an Authorized Officer of
the Depositor or the Servicer, as applicable.
Other Mortgage Documents: The documents or instruments related to each
Mortgage Loan contained in the Mortgage Files to be held and maintained by the
Servicer, on behalf of the Trustee, as described in Section 2.01(a)(2).
Opinion of Counsel: A written opinion of counsel, who (unless otherwise
specified) may be counsel for, or an employee of, the Depositor or an Affiliate
thereof, which counsel shall be reasonably acceptable to the addressee.
Original Value: For a Mortgaged Property, the lesser of the sales price
of such Mortgaged Property and the appraised value thereof determined pursuant
to an appraisal made in connection with origination of such Mortgage Loan,
except that the original appraisal of such Mortgaged Property may be used for a
Mortgage Loan that is not a purchase money mortgage.
Originator: Citicorp Trust Bank, fsb.
Outstanding: As of any date, all Certificates theretofore authenticated
and delivered under this Agreement except:
(i) Certificates theretofore canceled by the Certificate Registrar or
delivered to the Certificate Registrar for cancellation;
(ii) Certificates with respect to which money for a distribution in the
necessary amount to reduce the Principal Balance thereof to zero has
been theretofore deposited with the Trustee or any Paying Agent in trust
for the Holders of such Certificates;
(iii) Certificates in exchange for or in lieu of which other
Certificates have been authenticated and delivered pursuant to this
Agreement unless proof satisfactory to the Certificate Registrar is
presented that any such Certificates are held by a holder in due course;
and
(iv) Certificates alleged to have been destroyed, lost or stolen for
which replacement Certificates have been issued as provided for in
Section 5.03 and authenticated and delivered pursuant to this Agreement;
provided, however, that in determining whether the Holders of the requisite
percentage of the aggregate Principal Balance or Percentage Interest of any
Outstanding Certificates or of the Outstanding Certificates of any one or more
Classes thereof have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, such percentage shall be based on the
Principal Balance of such Certificate and provided, further, Certificates owned
by the Depositor or any Affiliate of the Depositor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent, or waiver, only Certificates which a Responsible
Officer of the Trustee has actual knowledge are so owned shall be so disregarded
and except that where the Depositor or any Affiliate of the Depositor shall be
owner of 100% of the aggregate Principal Balance or Percentage Interest of any
Class or Subclass of Outstanding Certificates, the Depositor or such Affiliate
shall be permitted to give any request, demand, authorization, direction,
notice, consent or waiver hereunder. Certificates so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee certifies in
writing to the Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not the Depositor or any Affiliate of the
Depositor.
Overcollateralization Amount: For any Distribution Date, any excess of
(x) the Aggregate Current Pool Balance as of the last day of the related
Collection Period over (y) the Certificate Balance (after giving effect to (i)
distributions of Principal Proceeds on such Distribution Date and (ii) and the
increase of any Class M Subclass Principal Balance as a result of Subsequent
Recoveries, but prior to the payment of any Extra Principal Distribution
Amount).
Pass-Through Rate: For a Mortgage Loan as of any date or for any period,
the applicable Mortgage Note Rate less the Servicing Fee Rate.
Paying Agent: Each paying agent identified in Article XII which is
authorized to make distributions on the Certificates on behalf of the Trustee. A
Paying Agent may not be the Originator, CMI or an Affiliate of CMI unless the
Paying Agent is an agency and trust department of Citibank, N.A. Any Paying
Agent other than an agency and trust department of Citibank, N.A. must be
authorized to exercise corporate trust powers under the laws of its jurisdiction
of organization.
Percentage Interest: For a Class of Class R Certificates, if the
Certificate has a Principal Balance as specified in Article XII, the Initial
Principal Balance of such Certificate (expressed as a percentage) of the
aggregate Initial Principal Balance of the Certificates of such Class and, if
the Certificate does not have a Principal Balance, the portion represented by
such Certificate (expressed as a percentage) of the total ownership interest in
the applicable Constituent REMIC represented by all Certificates of such Class.
For a Class of Class CE Certificates, if the Certificate has a Principal Balance
as specified in Article XII, the Initial Principal Balance of such Certificate
(expressed as a percentage) of the aggregate Initial Principal Balance of the
Certificates of such Class and, if the Certificate does not have a Principal
Balance, the portion represented by such Certificate (expressed as a percentage)
of the total ownership interest in the Certificates of such Class. For any
Certificate of an interest-only Class or Subclass of Certificates, the ratio of
the notional amount of such Certificate to the aggregate notional amount of the
entire Class or Subclass.
Periodic Interest Advance: For each Collection Period, the aggregate of
(a) the aggregate of the interest portions (net of the related Servicing Fees)
of Scheduled Payments on the Mortgage Loans that were due during such Collection
Period and Delinquent as of the related Determination Date (net of amounts
collected as income on the related REO Properties, in the case of REO Mortgage
Loans), after adjustment of delinquent interest payments to interest at the
Pass-Through Rate, (b) the aggregate of the Simple Interest Advanceable Amounts
in respect of the Mortgage Loans for such Collection Period, after adjustment of
such amounts to interest at the Pass-Through Rate, and (c) the aggregate of the
Bi-Weekly Interest Advanceable Amounts in respect of the Bi-Weekly Loans for
such Collection Period, after adjustment of such amounts to interest at the
Pass-Through Rate.
Periodic Rate Cap: The provision in a Mortgage Note that limits
permissible increases and decreases in the Mortgage Note Rate on any Adjustment
Date for an adjustable rate Mortgage Loan.
Permitted Activities: The primary activities of the trust created
hereunder, which shall be (a) holding Mortgage Loans sold by the Depositor and
other assets of the Trust Fund, including any credit enhancement and passive
derivative financial instruments, (b) issuing Certificates and other interests
in the assets of the Trust Fund, (c) receiving collections on the Mortgage Loans
and making payments on Certificates and interests in accordance with the
provisions of this Agreement and (d) engaging in other activities that are
necessary or incidental to accomplish these limited purposes.
Person: Any legal person, including any individual, corporation,
partnership, joint venture, association, joint stock company, trust, limited
liability company, unincorporated organization or government or any agency or
political subdivision thereof.
Plan: As defined in Section 5.02.
Pool: Each of the pools of Mortgage Loans designated as such in Article
XII.
Pool Balance: For the Mortgage Loans in a particular Pool as of any
date, the aggregate of the Loan Balances of all such Mortgage Loans.
Pooling Agreement: The Pooling Agreement (as defined in the preamble to
this Standard Terms Document) entered into with respect to a particular series
of Certificates and into which this Standard Terms Document is incorporated by
reference.
Predatory Lending Law: The Georgia Fair Lending Act, the Maine Consumer
Credit Code - Truth-in-Lending, the New Jersey Home Ownership Security Act of
2002, the New Mexico Home Loan Protection Act, the New York Predatory Lending
Act, or any similar State or federal law that regulates high-cost mortgage
loans.
Prepaid Installment: For any Mortgage Loan, any installment of principal
thereof and interest thereon received prior to the Due Date for such
installment, as an early payment thereof and not as a Principal Prepayment on
such Mortgage Loan.
Prepayment Charge: For a particular Mortgage Loan, the amount the
Mortgagor is contractually obligated to pay as a premium, charge or penalty for
the privilege of refinancing or otherwise prepaying such Mortgage Loan in whole
or in part.
Prepayment Interest Shortfall: For any Mortgage Loan and any Prepayment
Collection Period, any Equity Builder Prepayment Shortfall, Simple Interest
Prepayment Shortfall or Additional Prepayment Interest Shortfall that occurs
with respect to such Mortgage Loan during such Prepayment Collection Period.
Prepayment Collection Period. For a particular Distribution Date, the
preceding calendar month, being the period commencing with the opening of
business on the first day of such month and ending at the close of business on
the last day thereof.
Prepayment Principal: For any Distribution Date, the sum of all amounts
that constitute full or partial Principal Prepayments received in the related
Prepayment Collection Period.
Primary Mortgage Insurance Certificate: Any certificate of primary
mortgage insurance relating to a particular Mortgage Loan to the extent
identified in the Mortgage Loan Schedule.
Principal Balance: On any Distribution Date,
(i) for a Class A Certificate of any Subclass, its pro rata share based
on the Initial Principal Balance of the applicable Class A Subclass
Principal Balance; and
(ii) for a Class M Certificate of any Subclass, its pro rata share based
on the Initial Principal Balance of the applicable Class M Subclass
Principal Balance.
The Class CE Certificates and Class R Certificates do not have a Principal
Balance.
Principal Prepayment: For any Mortgage Loan, any payment of principal on
such Mortgage Loan which is received in advance of its Due Date and is not
accompanied by an amount of interest representing scheduled interest for any Due
Date in any month subsequent to the month of prepayment, excluding any proceeds
of or advances on any Liquidated Loan.
Principal Proceeds: For a Distribution Date, the sum (without
duplication) of (a) the principal portion of each Scheduled Payment on a
Mortgage Loans due on a Due Date during or prior to the related Collection
Period and received during such Collection Period, (b) the Loan Balance of each
Mortgage Loan repurchased during the related Prepayment Collection Period
pursuant to Section 2.02 or 2.03(a), (c) any Substitution Adjustment Amount
deposited for a substitution of a Mortgage Loan during the related Prepayment
Collection Period pursuant to Section 3.06(c)(2), (d) the principal portion of
Net Liquidation Proceeds received during the related Prepayment Collection
Period, (e) the principal portion of Net Subsequent Recoveries received during
the related Prepayment Collection Period (f) all Prepayment Principal received
during the related Prepayment Collection Period (including, without limitation,
the principal portion of Scheduled Payments due on Due Dates during future
Collection Periods but received during the current Collection Period), (g) the
principal portion of any payment made on such Distribution Date in connection
with the purchase of the Mortgage Loans pursuant to the Right to Purchase under
Section 9.01(a), and (h) if (and only if) the Collection Account or the
Certificate Account is an Investment Account, the allocable amount of investment
losses deposited pursuant to Section 4.03(b)(i).
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Property Protection Expenses: For Mortgage Loans prior to their becoming
Liquidated Loans, expenses paid or incurred by or for the account of the
Servicer or the Trust Fund in accordance with the related Mortgages for (a) real
estate property taxes, insurance premiums and property repair, replacement,
protection and preservation expenses and (b) similar expenses reasonably paid or
incurred to preserve or protect the value of such Mortgages or the related
Mortgaged Properties.
Prospectus: As defined in Section 12.02.
Qualified GIC: A GIC, assigned to the Trustee or a Paying Agent, or
entered into by the Trustee or a Paying Agent at the direction of the Depositor,
on or before the Issue Date, providing for the investment of funds ensuring a
minimum or fixed rate of return on investments of such funds, which GIC shall
(a) be an obligation of an insurance company, trust company, commercial
bank (which may be Citibank, N.A., Citibank (Delaware) or Citibank (New
York State)) or other entity whose credit standing is acceptable to each
Rating Agency;
(b) provide that the Trustee or a Paying Agent may exercise all of the
rights of the Depositor under such GIC without the necessity of the
taking of any action by the Depositor;
(c) provide that if at any time (subject to the second proviso of this
paragraph (c)) the then current credit standing of the obligor under
such GIC is such that continued investment of funds included in the
Trust Fund would result in a downgrading or withdrawal of any then
current rating of any Class or Subclass of the Certificates, the Trustee
or the Paying Agent may terminate such GIC and be entitled to the return
of all funds previously invested thereunder, together with accrued
interest thereon at the interest rate provided under such GIC through
the date of delivery of such funds to the Trustee or the Paying Agent,
provided that neither the Trustee nor the Paying Agent shall be charged
with knowledge of any such potential downgrading or withdrawal unless it
shall have received written notice of such potentiality from the
Depositor, the Servicer or the provider of the GIC which must be
obligated to give such notice at least once per year; provided, further,
that upon any such event the Depositor, by written notice to the Trustee
or the Paying Agent, may replace such GIC with a substitute GIC having
substantially the same terms (including without limitation a rate of
return at least as high as the GIC being replaced) so long as such
substitute GIC has an obligor with a credit standing no less than the
credit standing of the obligor under the GIC to be replaced at the time
the GIC was executed (or with a credit rating otherwise acceptable to
each Rating Agency) and such fact is certified by the Depositor to the
Trustee or the Paying Agent;
(d) provide that the Trustee's interest therein shall be transferable to
any successor trustee hereunder;
(e) provide that the funds invested thereunder and accrued interest
thereon be available not later than the Business Day prior to any
Distribution Date on which such funds may be required for distribution
hereunder; and
(f) meet such other standards as may be specified in Article XII.
Qualified Nominee: A Person (who may not be the Depositor or an
Affiliate thereof) in whose name Eligible Investments held by the Trustee or
Paying Agent may be registered as nominee of the Trustee or Paying Agent in lieu
of registration in the name of the Trustee or Paying Agent, provided that the
following conditions shall be satisfied in connection with such registration:
(a) the instruments governing the creation and operation of the nominee
provide that neither the nominee nor any owner of an interest in the
nominee (other than the Trustee or Paying Agent) shall have any
interest, beneficial or otherwise, in any Eligible Investments at any
time held in the name of the nominee, except for the purpose of
transferring and holding legal title thereto;
(b) the nominee and the Trustee or the Paying Agent have entered into an
agreement establishing that any Eligible Investments held in the name of
the nominee are to be held by the nominee as agent (other than
commission agent or broker) or nominee for the account of the Trustee;
and
(c) in connection with the registration of any Eligible Investment in
the name of the nominee, all requirements under applicable governmental
regulations necessary to effect a valid registration of transfer of such
Eligible Investment are complied with as evidenced to the Trustee or the
Paying Agent upon its request by an Opinion of Counsel.
Qualified Substitute Mortgage Loan: For any Mortgage Loan or Mortgage
Loans (each a "replaced Mortgage Loan") included in the Trust Fund for which
such Qualified Substitute Mortgage Loan is being substituted, a Mortgage Loan
for which all payments of principal and interest due on or before the
Substitution Day have been received and which has the following characteristics:
(a) (i) in the case of a fixed rate Mortgage Loan, a Mortgage Note Rate
no more than 1% per annum higher and no lower than that of such replaced
Mortgage Loan and (ii) in the case of an adjustable rate Mortgage Loan,
(1) a Maximum Note Rate and a Minimum Note Rate no more than 1% per
annum higher and no lower than that of such replaced Mortgage Loan, (2)
the same index and Periodic Rate Cap as such replaced Mortgage Loan and
a Gross Margin of no more than 1% per annum higher and no lower than
that of such replaced Mortgage Loan and (3) currently accruing interest
at a rate no more than 1% per annum higher and no lower than such
replaced Mortgage Loan;
(b) a date of maturity no later, and not more than one year earlier,
than the maturity date of the Mortgage Loan being replaced;
(c) a Loan-to-Value Ratio no higher than that of such replaced Mortgage
Loan;
(d) a Loan Balance at least equal to that of such replaced Mortgage
Loan;
(e) a credit quality classification of a same or higher classification
as that of such replaced Mortgage Loan;
(f) secured by a Mortgaged Property that is either a single family
dwelling or is of the same type as that securing such replaced Mortgage
Loan;
(g) an occupancy status that is either primary residence or is the same
status as that of such replaced Mortgage Loan;
(h) a lien priority that is either first or the same as that of such
replaced Mortgage Loan;
(i) is not a "balloon" loan unless such replaced Mortgage Loan is a
"balloon" loan;
(j) is a "qualified replacement mortgage" as defined in Code Section
860G(a)(4); and
(k) in the case of an adjustable rate Mortgage Loan, does not permit
conversion to a fixed rate;
provided, that (i) except for the conditions set forth in clauses (a),
(b), (c), (j) and (k) above, such characteristics may be satisfied on a weighted
average or other aggregate basis, (ii) clause (d) may be satisfied by deposit in
the Collection Account of sufficient funds so that the Loan Balance (calculated
by including such funds) of such Qualified Substitute Mortgage Loan satisfies
such clause (the "Substitution Adjustment Amount") and (iii) the Trustee shall
receive, not later than the Substitution Day, (1) an Opinion of Counsel, dated
the Substitution Day, to the effect that the substitution of such Qualified
Substitute Mortgage Loans and any deposit of cash in the Collection Account will
not constitute a "prohibited transaction" within the meaning of Code Section
860F(a), will not adversely affect the status of the Trust Fund as comprised of
the Constituent REMICs and will not otherwise subject the Trust Fund to any tax
and (2) an Officer's Certificate of the Depositor to the effect that (A) all
documents delivered to the Trustee in connection with such substitution comply
as to form with the requirements of Section 2.01(a) and (B) all conditions to
such substitution specified in Section 2.04(a) have been satisfied.
Realized Losses: For any Distribution Date, the aggregate of the amount
of losses for each Mortgage Loan which became a Liquidated Loan during the
related Prepayment Collection Period, equal to the excess of (i) the unpaid
principal balance of each such Liquidated Loan, plus accrued interest thereon in
accordance with the amortization schedule at the time applicable thereto at the
Mortgage Note Rate from the Due Date as to which interest was last paid through
the Due Date in the Prepayment Collection Period in which such Mortgage Loan
became an REO Mortgage Loan (or if such loan was liquidated without becoming an
REO Mortgage Loan, the Due Date in the Prepayment Collection Period in which
such loan was liquidated), over (ii) Net Liquidation Proceeds for such
Liquidated Loan.
Record Date: As defined in Article XII.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be amended from time to
time, and subject to such clarification and interpretation as have been provided
by the Securities and Exchange Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506 (Jan. 7,
2005)) or by the staff of the Securities and Exchange Commission, or as may be
provided by the Securities and Exchange Commission or its staff from time to
time.
Related Certificate Balance: As of any date, (a) if there is only one
Group, the Certificate Balance and (b) otherwise, for each Pool, the sum of (x)
the aggregate of the Class A Subclass Principal Balances of the Class A
Certificates in the related Group and (y) the aggregate of the Principal
Balances of all Class M Certificates allocated to such Group.
Relevant Servicing Criteria: As defined in Section 3.15(a).
REMIC: A "real estate mortgage investment conduit" within the meaning of
Code Section 860D. References to the "REMIC" are to the Constituent REMICs
constituting one or more portions of the Trust Fund.
REMIC Account: Any account or accounts that are required to be
established (in the same manner as the Certificate Account is established) and
maintained pursuant to Section 12.04.
REMIC Provisions: The provisions of the federal income tax law relating
to REMICs, appearing at Code Sections 860A through 860G, and related provisions
and regulations promulgated thereunder, as may be in effect from time to time.
REO Mortgage Loan: Any Mortgage Loan which is not a Liquidated Loan and
as to which the related Mortgaged Property is held as part of the Trust Fund.
REO Proceeds: Proceeds, net of any related expenses of the Servicer,
received in respect of any REO Mortgage Loan (including, without limitation,
proceeds from the rental of the related REO Property).
REO Property: A Mortgaged Property acquired by or on behalf of the Trust
Fund through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan or otherwise treated as having been acquired pursuant to
the REMIC Provisions.
Reportable Event: As defined in Section 4.09(e).
Required Amount of Certificates: (i) 66 2/3% or more of the aggregate
Voting Interest of the Outstanding Certificates, (ii) 66 2/3% or more of the
aggregate Outstanding Percentage Interest of the Class CE Certificates and (iii)
66 2/3% or more of the aggregate Outstanding Percentage Interest of the Residual
Certificates.
Residual Certificates: The Class R Certificates.
Responsible Officer: For any Person, the Chairman or any Vice Chairman
of the Board of Directors or Trustee, the Chairman or Vice Chairman of the
Executive or Standing Committee of the Board of Directors or Trustee, the
President, the Chairman of the committee on trust matters, any executive vice
president, senior vice president, first vice president, second vice president,
vice president, any assistant vice president, the Secretary, any assistant
secretary, the Treasurer, any assistant treasurer, the Cashier, any assistant or
deputy cashier, any trust officer or assistant trust officer, the Controller and
any assistant controller or any other officer of such Person customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer of
such Person to whom such matter is referred because of such officer's knowledge
of and familiarity with the particular subject; provided, however, that in
respect of the Trustee and the Paying Agent, "Responsible Officer" shall mean
any officer within the Corporate Trust Department (or any successor thereto)
thereof, including any vice president, assistant vice president, assistant
treasurer, trust officer or any other officer who customarily performs functions
similar to those provided by the persons who at the time shall be such officers,
respectively, and in each case having direct responsibility for the
administration of the Pooling Agreement or to whom any corporate trust matter is
referred because of such person's knowledge of and familiarity with the
particular subject.
S&P: Standard and Poor's, a division of The XxXxxx-Xxxx Companies, Inc.
Scheduled Payment: As to any Mortgage Loan (other than an REO Mortgage
Loan) and any Due Date, the payment of principal and interest that is due
thereon (or, in the case of an Equity Builder Loan, that is automatically
deductible from the related Mortgagor's personal bank account in accordance with
the related Equity Builder Agreement) in accordance with the amortization
schedule at the time applicable (after adjustment for (i) application of prior
Scheduled Payments on the loan to interest and principal pursuant to the simple
interest method employed by the Servicer, (ii) any partial Principal Prepayments
and (iii) Deficient Valuations occurring prior to such Due Date but before any
adjustment to such amortization schedule other than Deficient Valuations by
reason of any bankruptcy, or similar proceeding or any moratorium or similar
waiver or grace period). For the avoidance of doubt: for each Mortgage Loan
other than a Semi-Monthly Loan or a Bi-Weekly Loan, there is one Scheduled
Payment due in each calendar month; for each Semi-Monthly Loan, there are two
Scheduled Payments due in each calendar month; and for each Bi-Weekly Loan,
depending on the calendar month in question, there are either two or three
Scheduled Payments due in a calendar month.
Second Mortgage Loan: A Mortgage Loan secured by a second priority lien
on the related Mortgaged Property.
Semi-Monthly Loan: An Equity Builder Loan with respect to which the
related Mortgagor has authorized the Originator to cause the Servicer
automatically to deduct from such Mortgagor's personal bank account on a
semi-monthly basis certain periodic payments (as specified in the related Equity
Builder Agreement).
Senior Lien: The mortgage loan (which may be a Mortgage Loan) on
Mortgaged Property having a first priority lien.
Servicer: CMI, or its successor in interest, or any successor servicer
appointed as herein provided.
Servicing Advance: The aggregate of the advances made by the Servicer
pursuant to Sections 3.07(b), 3.11 and 3.18.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, as such may be amended from time to time.
Servicing Event of Default: An event described in Section 7.01.
Servicing Function Participant: Any affiliate, third party vendor or
Subservicer engaged by the Servicer or the Trustee that is participating in the
servicing function with respect to the Mortgage Loans, within the meaning of
Item 1122 of Regulation AB.
Servicing Officer: Any officer of the Servicer or of an Affiliate of the
Servicer involved in, or responsible for, the administration and servicing of
the Trust Fund whose name appears on a list of servicing officers attached to an
Officer's Certificate furnished to the Trustee and the Paying Agent by the
Servicer, as such list may from time to time be amended.
Similar Law: As defined in Section 5.02.
Similar State Law: Any state law that has the effect of (a) reducing the
Mortgage Note Rate or the amount of the Scheduled Payment, or (b) suspending the
obligation to make a Scheduled Payment, on a Mortgage Loan due to the
Mortgagor's being placed on active duty status, in military service or similar
status.
Simple Interest Advanceable Amount: For a Mortgage Loan and any
Scheduled Payment thereon that is due (or automatically deductible from the
related Mortgagor's personal bank account pursuant to an Equity Builder
Agreement) in any Collection Period and that is paid by the related Mortgagor on
a date prior to the Due Date therefor, an amount equal to the interest that
accrues at the applicable Mortgage Note Rate, from such actual date of payment
to such Due Date, on the outstanding principal balance of such Mortgage Loan
after giving effect to the principal portion of such payment, after adjustment
of such accrued interest to interest at the Pass-Through Rate.
Simple Interest Prepayment Shortfall: For a Mortgage Loan and any
Scheduled Payment thereon that is due (or automatically deductible from the
related Mortgagor's personal bank account pursuant to an Equity Builder
Agreement) in any Collection Period and that is paid by the related Mortgagor on
a date prior to the Due Date therefor, an amount equal to the interest that, if
such Mortgagor had instead made such Scheduled Payment on such Due Date, would
have accrued at the applicable Mortgage Note Rate (but adjusted to the
Pass-Through Rate) from such actual date of payment to such Due Date on an
amount equal to the excess of (x) the outstanding principal balance of such
Mortgage Loan before giving effect to the principal portion of such payment over
(y) the outstanding principal balance of such Mortgage Loan after giving effect
to the principal portion of such payment.
60+ Delinquent Loans: For a Determination Date, all REO Properties and
all Mortgage Loans for which any portion of a Scheduled Payment is 60 days or
more Delinquent (without regard to any grace period) as of the last day of the
preceding calendar month.
STAMP: As defined in Section 5.02.
Subclass: For a Class of Certificates, any group of such Class
designated as a Subclass in Article XII.
Subordinated Percentage: For any date, 100% minus the Class A Percentage.
Subordination Depletion Date: The first Distribution Date on which the
Principal Balance of the Subordinated Certificates has been reduced to zero.
Subsequent Recoveries: For any Liquidated Loan and any Prepayment
Collection Period, any amounts received by the Servicer in respect of such loan
subsequent to such loan having been determined to be a Liquidated Loan that
resulted in a Realized Loss during a previous Prepayment Collection Period.
Subservicer: Any person or persons to which the Servicer has delegated
servicing obligations hereunder pursuant to Section 3.03 or 6.06.
Subservicing Agreement: Any subservicing agreement between the Servicer
and a Subservicer.
Substitution Adjustment Amount: As defined in the definition of
Qualified Substitute Mortgage Loan.
Substitution Day: As defined in Section 2.04(a).
Trust Expenses: Any amounts payable by the Depositor pursuant to Section
12.05.
Trustee: The Person executing this Agreement as Trustee, or its
successor in interest, or any successor trustee appointed as herein provided.
Trust Fund: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans, the Certificate Account, the Collection
Account, each REMIC Account, any REO Property, any Primary Mortgage Insurance
Certificates, any other insurance policies with respect to the Mortgage Loans,
any investment earnings on amounts in any Investment Account and any other
property or rights specified in Article XII as being part of the Trust Fund.
Unpaid Loan Balance: For any Mortgage Loan as of any date, the
outstanding principal balance thereof on such date.
Unsupported Prepayment Interest Shortfall: For any Distribution Date,
and any interest-bearing Class or Subclass of Certificates, the pro rata share
allocated thereto based on the amount of interest accrued thereon during the
related Interest Accrual Period at the related Certificate Rate (or, if lower,
the Net WAC Rate for such Distribution Date) of the excess, if any, of (x) the
Prepayment Interest Shortfalls for the related Prepayment Collection Period over
(y) the Maximum Compensating Interest Amount for the related Collection Period;
provided that, in accordance with clause (a) of the definition of "Maximum
Compensating Interest Amount", the Servicer will not advance its Servicing Fee
or any portion thereof to reduce Prepayment Interest Shortfalls.
U.S. Person: A citizen or resident of the United States of America, a
corporation or partnership (unless, in the case of a partnership, Treasury
regulations are adopted that provide otherwise) created or organized in or under
the laws of the United States of America, any state thereof or the District of
Columbia, including an entity treated as a corporation or partnership for
federal income tax purposes, an estate whose income is subject to U.S. federal
income tax regardless of its source, or a trust if a court within the United
States is able to exercise primary supervision over the administration of such
trust, and one or more such U.S. Persons have the authority to control all
substantial decisions of such trust (or, to the extent provided in applicable
Treasury regulations, certain trusts in existence on August 20, 1996 which are
eligible to elect to be treated as U.S. Persons).
Section 1.02 Fiscal Year.
The fiscal year of the Trust will be the calendar year.
ARTICLE II
CONVEYANCE OF TRUST FUND; ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Trust Fund.
CRMSI, concurrently with the execution and delivery of this Agreement,
does hereby sell, transfer, assign, set over and otherwise convey to the Trustee
without recourse, all the right, title and interest of CRMSI in and to the Trust
Fund, including without limitation all of the right, title and interest of CRMSI
in the Mortgage Loans, including all amounts received or receivable by CRMSI on
or with respect to the Mortgage Loans on or after the Cut-Off Date (but not any
(i) Non-Transferred Interest Amounts, (ii) payments of principal and interest
received on the Mortgage Loans on or before the Cut-Off Date or (iii) any
Prepayment Charges received or receivable with respect to any Mortgage Loan),
together with all of its right, title and interest in and to the proceeds of any
title, hazard or other insurance policies, or Primary Mortgage Insurance
Certificates, related to such Mortgage Loans. The transfer of the Mortgage Loans
hereunder is absolute and is intended by the parties hereto as a sale. It is the
intention of CRMSI that all Mortgage Loans transferred to the Trust Fund be
removed from CRMSI's assets and estate. If the transfer of the Mortgage Loans is
instead characterized as a pledge and not as a sale, then (x) CRMSI shall be
deemed to have granted to the Trustee a first priority security interest in all
of CRMSI's right, title and interest in and to such the Mortgage Loans and other
assets of the Trust Fund and (y) it is the intention of the parties that this
Agreement constitute a security agreement under applicable law in favor of the
Trustee, as secured party hereunder. CRMSI shall not transfer any additional
property to the Trust Fund except as expressly permitted by this Agreement.
(a) (1) In connection with such transfer and assignment of Mortgage
Loans, CRMSI does herewith deliver to the Trustee (or to the Mortgage Note
Custodian on behalf of the Trustee) to be held in trust the Mortgage Note,
endorsed (whether by means of an allonge or otherwise) by manual or facsimile
signature without recourse by the Originator or an Affiliate of the
Originator in blank or to the Trustee showing a complete chain of
endorsements from the named payee to the Trustee or from the named payee to
the Affiliate of the Originator and from such Affiliate to the Trustee or,
for any lost, misplaced or destroyed Mortgage Note, an original Lost Note
Affidavit, provided that endorsement is not required where Mortgage
Electronic Registration Systems, Inc. ("MERS") is the named payee or the
nominee of the named payee.
(2) In connection with such transfer and assignment of Mortgage Loans,
CRMSI does herewith deliver to the Trustee (or to the Servicer on behalf of
the Trustee) to be held in trust the following documents or instruments with
respect to each Mortgage Loan so transferred and assigned (except where, and
to the extent, CRMSI is complying with Section 2.01(b)):
(i) The original recorded Mortgage with evidence of recording
thereon, or a copy of the Mortgage certified by the public recording
office in those jurisdictions where the public recording office retains
the original;
(ii) Any original assumption or modification agreement applicable
to the Mortgage;
(iii) An assignment from the Originator to the Trustee in
recordable form (subject to proviso (x) below) of the Mortgage, which
may be included, where permitted by local law, in a blanket assignment
or assignments of the Mortgage to the Trustee, including any intervening
assignments and showing a complete chain of title from the original
mortgagee named under the Mortgage to CRMSI or an Affiliate of CRMSI and
to the Trustee, provided that (x) any blanket assignment delivered
pursuant to this clause (a)(2)(iii) shall not be in recordable form but
shall be delivered together with a limited power of attorney to
authorize the Servicer, on behalf of the Trustee, and the Trustee to act
for the Originator in preparing, executing, delivering and recording in
the name of the Trustee any instruments for recording assignments of the
related Mortgages to the Trustee, (y) if the Mortgage is registered with
MERS, only assignments from the originator of the Mortgage to MERS will
be required and (z) if the Mortgage was originated with MERS as the
original mortgagee, no interim assignment will be required; and
(iv) Either (x) the original or a copy of the title insurance
policy (which may be a certificate or a short form policy relating to a
master policy of title insurance) or the title searches pertaining to
the Mortgaged Property, or in the event such original title policy is
unavailable, a copy of the preliminary title report and the lender's
recording instructions, with the original to be delivered within 180
days of the Issue Date or other evidence of title or (y) in
jurisdictions where such practice is customary and acceptable, an
attorney's opinion as to title or an insured title report.
(3) The Mortgage Note Custodian will hold the Mortgage Notes, and the
Servicer will hold the Other Mortgage Documents, in trust for the Trustee and
the benefit of the Trustee, any Insurer and all present and future
Certificateholders.
(4) In addition, CRMSI, concurrently with the execution and delivery
of this Agreement and in connection with such transfer and assignment of
Mortgage Loans shall deposit in the Collection Account the amount of all
payments received by CRMSI after the Cut-Off Date and prior to the Issue Date
with respect to the Mortgage Loans, to the extent such payments are being
transferred and assigned to the Trustee hereunder, except any portion of such
payments on Mortgage Loans (including servicing fees) of a type not required
to be deposited as specified in Article XII.
(b) In instances where an original recorded Mortgage cannot be
delivered to the Trustee (or to the Servicer on behalf of the Trustee) by the
Issue Date, due to a delay in the recording, CRMSI may (1) in lieu of
delivering such original recorded Mortgage referred to in clause (a)(2)(i)
above, deliver to the Trustee (or the Servicer on behalf of the Trustee) a
copy thereof, provided that CRMSI certifies that the original Mortgage has
been delivered to a title insurance company for recordation after receipt of
its policy of title insurance or binder therefor (which may be a certificate
relating to a master policy of title insurance), and (2) in lieu of
delivering the completed assignment in recordable form referred to in clause
(a)(2)(iii) above to the Trustee (or the Servicer on behalf of the Trustee),
deliver such assignment to the Trustee (or the Servicer on behalf of the
Trustee) completed except for recording information. In such instances, CRMSI
will deliver the original recorded Mortgage and completed assignment (if
applicable) to the Trustee (or the Servicer on behalf of the Trustee)
promptly upon receipt thereof. In instances where an original recorded
Mortgage or assignment has been lost or misplaced, CRMSI or the related title
insurance company may deliver, in lieu thereof, a copy of such Mortgage or
assignment bearing recordation information. In instances where the original
or a copy of the title insurance policy referred to in clause (a)(2)(iv)(x)
above pertaining to a Mortgaged Property cannot be delivered to the Trustee
(or the Servicer on behalf of the Trustee) by the Issue Date because such
policy is not yet available, CRMSI may deliver to the Trustee (or the
Servicer on behalf of the Trustee) a binder with respect to such policy and
deliver the original or a copy of such policy to the Trustee (or the Servicer
on behalf of the Trustee) when available. In instances where an original
assumption or modification agreement cannot be delivered to the Trustee (or
the Servicer on behalf of the Trustee) by the Issue Date, CRMSI may deliver a
certified copy thereof, and will deliver the original assumption or
modification agreement to the Trustee (or the Servicer on behalf of the
Trustee) promptly upon receipt thereof.
CRMSI agrees, at its own expense, to prepare (or to cause the Servicer
to prepare) each assignment referred to in clause (a)(2)(iii) above and
deliver a copy of each such assignment to the Trustee as soon as practicable
but not later than 60 days after the Issue Date. CRMSI intends to effect (or
to cause the Servicer to effect) recordation of each such assignment (or to
supply the Trustee, or the Servicer on behalf of the Trustee, with evidence
of recordation) as soon as practicable after the Issue Date in the
appropriate public office for real property records in each jurisdiction in
which such recordation is required by a Rating Agency. In addition, in the
event that on a Distribution Date a Mortgage Loan is 90 days Delinquent, if
recordation of assignment is required by any Rating Agency under its then
current ratings criteria, then CRMSI shall effect recordation of an
assignment of the related Mortgage to the Trustee promptly thereafter. Except
as provided in this paragraph, neither CRMSI nor the Originator or any
Affiliate of the Originator shall have any obligation to record any
assignment of any Mortgage in order to name the Trustee as mortgagee of
record. The preceding sentence shall not be in derogation of the obligation
of CRMSI, the Originator and Affiliates of the Originator to record (and
supply the Trustee with evidence thereof) assignments of Mortgages required
in order that CRMSI, the Originator or an Affiliate of the Originator be
shown as mortgagee of record of each Mortgage.
In the case of Mortgage Loans which have been prepaid in full after
the Cut-Off Date and prior to the Issue Date, CRMSI, in lieu of delivering
the above documents to the Trustee (or to the Mortgage Note Custodian or the
Servicer, as applicable, on behalf of the Trustee), herewith delivers to the
Trustee (or to the Mortgage Note Custodian or the Servicer, as applicable, on
behalf of the Trustee) a Request for Release as set forth in Section 3.12(a).
In connection with such transfer and delivery of the balance of the Trust
Fund, CRMSI, concurrently with the execution and delivery of this Agreement,
shall deposit into the Collection Account cash in the amount (if any)
specified in Article XII.
Wherever it is provided in this Section 2.01 that any document,
evidence or information relating to a Mortgage Loan be delivered or supplied
to the Trustee, CRMSI or the Servicer, as applicable, shall do so by delivery
thereof to the Mortgage Note Custodian or the Servicer, as applicable, to be
held on behalf of the Trustee. The functions of the Trustee under this
Agreement with respect to the custody, acceptance, inspection and release of
the Mortgage Files (including the review provided for in Section 2.02) shall
be performed by the Mortgage Note Custodian or the Servicer, as applicable,
on behalf of the Trustee.
(c) The parties hereto acknowledge and agree that it is not intended
that any mortgage loan be included in the Trust Fund that is a "High-Cost" or
"Covered" mortgage loan as defined by the U.S. Home Ownership and Equity
Protection Act of 1994, as amended, or any other applicable local, state or
federal predatory or abusive lending laws.
(d) For purposes of this Section 2.01, any document (other than a
Mortgage Note) will be deemed "delivered" to a person if the person has
received, or been granted unrestricted access to, an image of the document
that is inscribed in a tangible medium or is stored in an electronic or other
medium and is retrievable in perceivable form.
Section 2.02 Acceptance by Trustee.
The Trustee, by execution and delivery hereof, acknowledges receipt,
subject to the review described in the following paragraph, of the documents and
other property referred to in Section 2.01 and declares that the Trustee holds
and will hold such documents and other property, including property yet to be
received in the Trust Fund, in trust, upon the trusts herein set forth, for the
benefit of all present and future Certificateholders.
The Servicer, by execution and delivery hereof, acknowledges receipt of
the Other Mortgage Documents delivered by CRMSI in accordance with Section
2.01(a)(2) and declares that the Servicer on behalf of the Trustee holds and
will hold such Other Mortgage Documents, including any Other Mortgage Documents
yet to be received in the Trust Fund, in trust, for the benefit of all present
and future Certificateholders.
Pursuant to the Mortgage Note Custodial Agreement, the Trustee (or the
Mortgage Note Custodian on the Trustee's behalf) shall, for the benefit of the
Certificateholders, review each Mortgage Note within 90 days after the Issue
Date to ascertain that it has been executed and received, and that such Mortgage
Note relates to the Mortgage Loans identified in Exhibit B. Except as expressly
provided in this Agreement, neither the Mortgage Note Custodian nor the Servicer
is required to inspect or review any document in a Mortgage File. However, if
the Trustee (or the Mortgage Note Custodian or the Servicer) finds that a
Mortgage Document is missing or materially defective, the Trustee (or the
Mortgage Note Custodian or the Servicer) shall promptly notify the Servicer and
CRMSI (which notification may be made by e-mail to
xxxxxxxxxxxxxxx@xxxxxxxxx.xxx). CRMSI will then have a period of 180 days within
which to correct or cure any such defect (including correction or cure by
substitution if permitted by Section 2.04). If any such material defect has not
been corrected or cured, CRMSI will, not later than 180 days after the Trustee's
notice respecting such defect, repurchase the related Mortgage Loan from the
Trustee at a price (the "Loan Repurchase Price") equal to (i) the Loan Balance
of such Mortgage Loan as of the date of repurchase, plus, (ii) to the extent not
previously advanced by the Servicer, accrued and unpaid interest thereon at the
Mortgage Note Rate to (but not including) the date of repurchase, plus (iii) any
unreimbursed payments with respect to such Mortgage Loan, to the extent not
covered in (ii) above, as part of a Servicing Advance or a Periodic Interest
Advance, plus (iv) any unreimbursed costs, penalties or damages incurred by the
Trustee or the Trust Fund in connection with any violation of applicable
predatory or abusive lending laws with respect to such Mortgage Loan or
otherwise incurred in connection with such material defect. Notwithstanding the
preceding two sentences, any material defect that causes a Mortgage Loan to fail
to constitute a "qualified mortgage" within the meaning of Code Section
860G(a)(3) shall either be corrected or cured by CRMSI or, failing such
correction or cure, CRMSI shall repurchase such Mortgage Loan at the Loan
Repurchase Price (or, if within two years of the Startup Day, or such other
period as may be permitted by the REMIC Provisions, substitute a Qualified
Substitute Mortgage Loan therefor pursuant to Section 2.04) no later than 90
days after the discovery of such material defect. Any such repurchase shall be
considered a prepayment in full of such Mortgage Loan on date of repurchase and
shall be deposited by CRMSI in the Collection Account and, upon receipt by the
Trustee of written notification of such deposit signed by an Authorized Officer
of CRMSI, the Trustee (or the Mortgage Note Custodian or the Servicer, as
applicable, on behalf of the Trustee) shall release to CRMSI or its designee the
related Mortgage File and shall execute and deliver such instruments of transfer
or assignment furnished to the Trustee, in each case without recourse, as CRMSI
shall reasonably request, to vest in CRMSI or such designee any Mortgage Loan so
released. Any repurchase by CRMSI of a Mortgage Loan hereunder shall be deemed
to include the right to receive any Scheduled Payment or other remittance
thereon payable or received after the date of repurchase, and the Trustee or the
Paying Agent shall, upon receipt thereof, promptly remit the amount of such
Scheduled Payment or other remittance to CRMSI. It is understood and agreed that
the obligation of CRMSI to repurchase any Mortgage Loan or make a substitution
therefor pursuant to Section 2.04 as to which a material defect in a constituent
document exists shall constitute the sole remedy against CRMSI with respect to
such defect available to the Certificateholders or the Trustee on behalf of the
Certificateholders.
Section 2.03 Representations and Warranties of CRMSI and CMI.
(a) CRMSI makes the representations and warranties set forth in Article
XIV to the Trustee (which representations are incorporated by reference herein
as though set forth below in this Section 2.03(a)) and, in addition, CRMSI
hereby represents and warrants to the Trustee that:
(i) The information set forth in Exhibit B was true and correct
in all material respects as of the Cut-Off Date.
(ii) As of the Issue Date, each Mortgage is a valid first lien on
the property securing the related Mortgage Note subject only to (a) the
lien of current real property taxes and assessments, (b) covenants,
conditions and restrictions, rights of way, easements and other matters
of public record as of the date of recording of such Mortgage, such
exceptions appearing of record being acceptable to mortgage lending
institutions generally or specifically referred to in the title
insurance policy or reflected in the appraisal obtained in connection
with the origination of the related Mortgage Loan and (c) other matters
to which like properties are commonly subject that do not in the
aggregate materially interfere with the benefits of the security
intended to be provided by such Mortgage.
(iii) Immediately prior to the transfer of the Mortgage Loans to
the Trustee, CRMSI has good title to, and is the sole owner of, each
Mortgage Loan (except as set forth in clause (v) below) and immediately
upon the transfer and assignment herein contemplated, CRMSI will have
taken all steps necessary so that the Trustee will have good title to,
and will be the sole owner of, each Mortgage Loan (except as set forth
in clause (v) below).
(iv) As of the Cut-Off Date, except as stated in Article XIV, no
payment of principal of or interest on or in respect of any Mortgage
Loan is more than 30 days Delinquent.
(v) As of the Issue Date, there is no mechanics' lien or claim
for work, labor or material affecting the premises subject to any
Mortgage which is or may be a lien prior to, or equal with, the lien of
such Mortgage except those which are insured against by the title
insurance policy or report referred to in (x) below.
(vi) As of the Issue Date, there is no delinquent tax or
assessment lien against any Mortgaged Property.
(vii) As of the Issue Date, there is no valid offset, defense or
counterclaim to any Mortgage Note or Mortgage, including the obligation
of the Mortgagor to pay the unpaid principal and interest on such
Mortgage Note.
(viii) As of the Issue Date, each Mortgaged Property is free of
substantial damage.
(ix) Each Mortgage Loan, at the time it was originated, complied
in all material respects with applicable State, local and federal laws,
including, but not limited to, all applicable usury, equal credit
opportunity and disclosure laws and all applicable Predatory Lending
Laws.
(x) A lender's title insurance policy or binder (which policy was
issued in standard ALTA or equivalent form), insured title report or
other assurance of title customary in the relevant jurisdiction, was
issued on the date of the origination of each Mortgage Loan and, as of
the Issue Date, each such policy, binder, report or assurance is valid
and remains in full force and effect.
(xi) The Mortgage Loans conform in all material respects with the
descriptions thereof in the Prospectus relating to the Certificates.
(xii) The original principal balance of each Mortgage Loan was
not more than 100% of the Original Value of such Mortgage Loan.
(xiii) For each Mortgage where a Lost Note Affidavit has been
delivered to the Trustee, the related original Mortgage Note is no
longer in existence.
(xiv) As of the Issue Date, each Mortgage was recorded (or was in
the process of being recorded) in the name of CRMSI or an Affiliate of
CRMSI.
(xv) No Mortgage has been satisfied, canceled, subordinated or
rescinded, in whole or in part, and the related 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, release, cancellation, subordination or rescission.
(xvi) No fraud or material misrepresentation with respect to the
origination of a Mortgage Loan has been committed by CRMSI or any
Affiliate of CRMSI;
(xvii) The proceeds of each Mortgage Loan have been fully
disbursed and there is no requirement for future advances thereunder.
(xviii)As of the date of origination and as of the Cut-Off Date,
to the best of CRMSI's knowledge, each Mortgaged Property was lawfully
occupied.
(xix) The servicing and collection practices used in connection
with each Mortgage Loan have been in all material respects in accordance
with applicable law.
(xx) As of the Cut-Off Date, there was no proceeding pending or,
to CRMSI's knowledge, threatened for the total or partial condemnation
of a Mortgaged Property.
(xxi) As of the Cut-Off Date, no Mortgagor was a debtor in any
state or federal bankruptcy or insolvency proceeding.
(xxii) The Mortgage Notes for all Mortgage Loans have been
delivered to the Mortgage Note Custodian or will be so delivered within
a reasonable time after receipt thereof from a settlement agent and the
Other Mortgage Documents for all Mortgage Loans have been delivered to
the Servicer or will be so delivered within a reasonable time after
receipt thereof from a settlement agent or recording officer.
(xxiii)No Mortgage Loan contains provisions pursuant to which
Scheduled Payments are paid or partially paid with funds deposited in
any separate account established by the Originator or any other person
on behalf of the Mortgagor, or contains any similar provisions which may
constitute a "buydown" provision.
(xxiv) No Mortgage Loan is a high cost loan under the Predatory
Lending Law of any jurisdiction in which a Mortgaged Property is
located. No Mortgage Loan is a "High Cost Loan" or "Covered Loan," as
such terms are defined in the current version of Standard & Poor's
LEVELS(R) Glossary, (Version 6.0 Revised). No Mortgage Loan originated
on or after October 1, 2002 through March 6, 2003 is governed by the
Georgia Fair Lending Act.
(xxv) Each Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code.
(xxvi) Each Mortgage Loan was originated by an entity described
in Section 3(a)(41)(A)(ii) of the Exchange Act.
(xxvii)As of the Issue Date, no Mortgage or Mortgage Note has
been modified in any material respect, except by a written instrument
that has been recorded or submitted for recordation, if necessary, to
protect the interests of the Certificateholders and the original or a
copy of which has been delivered to the Servicer.
(xxviii) To the best of CRMSI's knowledge, at the Issue Date, the
improvements upon each Mortgaged Property are covered by a valid and
existing hazard insurance policy with a generally acceptable carrier
that provides for fire and extended coverage and coverage for such other
hazards as are customary in the area where the Mortgaged Property is
located.
(xxix) To the best of CRMSI's knowledge, at the Issue Date, if
the Mortgaged Property is in an area identified in the Federal Register
by the Federal Emergency Management Agency as having special flood
hazards, a flood insurance policy in a form meeting the requirements of
the current guidelines of the Flood Insurance Administration is in
effect with respect to such Mortgaged Property with a generally
acceptable carrier.
(xxx) The Mortgage Loans were not selected from the Originator's
portfolio of non-prime and sub-prime residential mortgage loans on the
Cut-Off Date in a manner believed to be adverse to the interests of the
Certificateholders.
The representations and warranties set forth in, or incorporated by
reference in, this Section 2.03(a) shall survive delivery of the Mortgage Loans
to the Trustee. Upon discovery by CRMSI, the Certificate Administrator or the
Trustee of a breach of any of the foregoing representations and warranties that
materially and adversely affects the interests of the Certificateholders in the
related Mortgage Loan (including any Mortgage Loan substituted for a
nonconforming Mortgage Loan pursuant to Section 2.04), the party discovering
such breach shall give prompt written notice to the other parties hereto. If
within 60 days of the date of such notice of breach or, with the prior written
consent of a Responsible Officer of the Trustee, such longer period specified in
such consent, CRMSI does not cure such breach in all material respects
(including by substitution of one or more Qualified Substitute Mortgage Loans if
permitted by Section 2.04), CRMSI shall repurchase such Mortgage Loan from the
Trustee. With respect to the representations and warranties described in this
Section 2.03(a) that are made to the best of CRMSI's knowledge, if it is
discovered by any of CRMSI, the Certificate Administrator or the Trustee that
the substance of such representation and warranty is inaccurate and such
inaccuracy materially and adversely affects the interests of the
Certificateholders in the related Mortgage Loan, notwithstanding CRMSI's lack of
knowledge with respect to the substance of such representation or warranty, such
inaccuracy shall be deemed a breach of the applicable representation or
warranty.
Any such repurchase of a Mortgage Loan by CRMSI shall be accomplished in
the manner set forth in Section 2.02 and at the Loan Repurchase Price. Any such
repurchase shall be considered a prepayment in full of such Mortgage Loan on
date of repurchase and shall be deposited by CRMSI in the Collection Account
and, upon receipt by the Trustee of written notification of such deposit signed
by an Authorized Officer of CRMSI, the Trustee (or the Mortgage Note Custodian
or the Servicer, as applicable) shall release to CRMSI or its designee the
related Mortgage File and shall execute and deliver such instruments of transfer
or assignment, in each case without recourse, as CRMSI shall reasonably request,
to vest in CRMSI or such designee any Mortgage Loan so released. Any repurchase
by CRMSI of a Mortgage Loan hereunder shall be deemed to include the right to
receive any Scheduled Payment or other remittance thereon payable or received
after the date of repurchase, and the Trustee or the Paying Agent shall, upon
receipt thereof, promptly remit the amount of such Scheduled Payment or other
remittance to CRMSI. It is understood and agreed that the obligation of CRMSI to
repurchase or substitute (as provided in Section 2.04) any Mortgage Loan as to
which a breach occurred and is continuing shall constitute the sole remedy
against CRMSI respecting such breach available to the Certificateholders or the
Trustee on behalf of the Certificateholders.
(b) CMI hereby represents and warrants to the Trustee as follows:
(i) It is a corporation validly existing and in good standing
under the laws of the State of New York and is duly authorized and
qualified to transact any and all business contemplated by this
Agreement to be conducted by the Servicer.
(ii) It has the full corporate power and authority to service
each Mortgage Loan and to execute, deliver and perform, and to enter
into and consummate the transactions contemplated by this Agreement and
has duly authorized, by all necessary corporate action on its part, the
execution, delivery and performance of this Agreement.
(iii) The execution and delivery of this Agreement by it, the
servicing of the Mortgage Loans by it under this Agreement, and the
fulfillment of or compliance with the terms hereof are in the ordinary
course of business of the Servicer and will not (A) result in a material
breach of any term or provision of the charter or by-laws of the
Servicer or (B) materially conflict with, result in a material breach,
violation or acceleration of, or result in a material default under, the
terms of any other material agreement or instrument to which it is a
party or by which it may be bound, or (C) constitute a material
violation of any statute, order or regulation applicable to it of any
court, regulatory body, administrative agency or governmental body
having jurisdiction over it.
(iv) It is a HUD-approved mortgagee.
(v) No litigation is pending or, to the best of its knowledge,
threatened, against the Servicer that would materially and adversely
affect the execution, delivery or enforceability of this Agreement or
its ability to service the Mortgage Loans or to perform any of its other
obligations under this Agreement in accordance with the terms hereof.
Section 2.04 Substitution of Qualified Substitute Mortgage Loans for
Nonconforming Mortgage Loans.
(a) CRMSI shall have the right, in an event requiring a repurchase
pursuant to Section 2.02 or 2.03(a), to substitute one or more Qualified
Substitute Mortgage Loans for any one or more nonconforming Mortgage Loans, any
such substitution to take place on the Business Day designated by CRMSI (the
"Substitution Day") occurring before a date two years after the Startup Day,
subject to the Trustee receiving an Officer's Certificate of CRMSI attaching as
an exhibit a supplemental Mortgage Loan schedule (the "Supplemental Mortgage
Loan Schedule") setting forth the same type of information as appears on the
Mortgage Loan Schedule and representing as to the accuracy thereof and
confirming that the representations and warranties contained in Section 2.03(a)
(other than paragraphs (i) and (xi) thereof) are true and correct in all
material respects with respect to the Qualified Substitute Mortgage Loans on and
as of the Substitution Day, provided that remedies for the inaccuracy of such
representation are limited as set forth in Sections 2.02, 2.03(a) and this 2.04.
CRMSI shall also deposit or cause to be deposited on the Substitution Day (i) an
amount equal to any unreimbursed costs, penalties or damages incurred by the
Trustee or the Trust Fund in connection with any violation of applicable
predatory or abusive lending laws with respect to such nonconforming Mortgage
Loan or Loans and (ii) any Substitution Adjustment Amount with respect to such
Qualified Substitute Mortgage Loan or Loans.
(b) In the event that, on the Substitution Day, any Prepaid
Installments have been deposited for such replaced Mortgage Loan, the full
amount of such Prepaid Installments shall be paid on the Substitution Day to
CRMSI from the Collection Account.
(c) Concurrently with the satisfaction of the conditions set forth in
Section 2.04(a) and the grant of such Qualified Substitute Mortgage Loans to
the Trustee pursuant to Section 2.04(a), (A) Exhibit B to this Agreement
shall be deemed to be amended to exclude all Mortgage Loans being replaced by
such Qualified Substitute Mortgage Loans and to include, pursuant to Section
10.01, the information set forth on the Supplemental Mortgage Loan Schedule
with respect to such Qualified Substitute Mortgage Loans, and all references
in this Agreement to Mortgage Loans shall include such Qualified Substitute
Mortgage Loans and (B) the Trustee shall release to CRMSI or its designee the
nonconforming Mortgage Loan or Loans and related Mortgage Files and execute
and deliver such instruments of transfer or assignment as may be required to
transfer, without recourse, to CRMSI or such designee such nonconforming
Mortgage Loan or Loans.
Section 2.05 [Reserved].
Section 2.06 Authentication of Certificates.
The Trustee has authenticated and delivered or caused to be
authenticated and delivered to or upon a Depositor Order, in exchange for the
Mortgage Loans, concurrently with the transfer and assignment to the Trustee of
the Mortgage Loans, Certificates duly authenticated by the Trustee or an
Authenticating Agent in authorized denominations evidencing the entire ownership
of the Trust Fund.
Section 2.07 Permitted Activities.
The Trust is created for the object and purposes of engaging in
Permitted Activities.
Section 2.08 Additional Representations.
CRMSI represents and warrants that
(a) The Mortgage Notes constitute "instruments" within the meaning of
the Delaware Uniform Commercial Code. All original executed Mortgage Notes
have been or will be delivered to the Trustee (or the Mortgage Note Custodian
on its behalf) in accordance with this Agreement.
(b) The Mortgage Note Custodial Agreement provides that the Mortgage
Note Custodian is holding the Mortgage Notes that evidence the Mortgage Loans
solely on behalf of and for the benefit of the Trustee and the Holders of
Certificates.
(c) None of the Mortgage Notes has any marks or notations indicating
that it has been pledged, assigned or otherwise conveyed to any person other
than CRMSI and the Trustee.
(d) CRMSI has not authorized the filing of, and is not aware of, any
financing statement against CRMSI that includes a description of the Mortgage
Loans or the Mortgage Notes.
(e) CRMSI is not aware of any judgment or tax lien filings against it.
ARTICLE III
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01 Servicing.
Acting directly or through one or more Subservicers as provided in
Section 3.03, the Servicer shall service and administer the Mortgage Loans in
accordance with this Agreement, the terms of the respective Mortgage Loans, all
applicable laws (including, without limitation, any applicable predatory and
abusive lending laws), and its normal and customary servicing standards, and
shall have full power and authority, acting alone, to do or cause to be done any
and all things in connection with such servicing and administration which it may
deem necessary or desirable. The Servicer shall not be required to institute
litigation for collection of any payment if it reasonably questions its ability
to enforce the provision of the Mortgage Loan under which the payment is
required. Subject to the terms hereof, the Servicer shall have full power and
authority to execute and deliver, on behalf of the Trustee, customary consents,
waivers and similar instruments.
Subject to Section 3.03, the Servicer may, and is hereby authorized to,
perform any of its servicing responsibilities with respect to all or certain of
the Mortgage Loans through a Subservicer as it may from time to time designate,
but no such designation of a Subservicer shall serve to release the Servicer
from any of its obligations under this Agreement. Such Subservicer shall have
the rights and powers of the Servicer which have been delegated to such
Subservicer with respect to such Mortgage Loans under this Agreement.
Without limiting the generality of the foregoing, but subject to
Sections 3.11 and 3.12, the Servicer in its own name or in the name of a
Subservicer may be authorized and empowered pursuant to a power of attorney
executed and delivered by the Trustee to execute and deliver, and may be
authorized and empowered by the Trustee to execute and deliver, on behalf of
itself, the Holders and the Trustee or any of them, (i) any and all instruments
of satisfaction or cancellation or of partial or full release or discharge and
all other comparable instruments with respect to the Mortgage Loans and the
Mortgaged Properties, (ii) to institute foreclosure proceedings or obtain a deed
in lieu of foreclosure so as to effect ownership of any Mortgaged Property in
the name of the Servicer on behalf of the Trustee, and (iii) to hold title to
any Mortgaged Property upon such foreclosure or deed in lieu of foreclosure on
behalf of the Trustee. Section 3.11(a) and Section 3.12(a) shall each constitute
a revocable power of attorney from the Trustee to the Servicer to execute an
instrument of satisfaction (or assignment of mortgage without recourse) for any
Mortgage Loan held by the Trustee paid in full or foreclosed (or for which
payment in full has been escrowed). Revocation of such power of attorney shall
take effect upon (i) the receipt by the Servicer of written notice thereof from
the Trustee or (ii) the termination of the Trust. Upon written instructions from
the Servicer, the Trustee shall execute any documentation furnished to it by the
Servicer for recordation by the Servicer in the appropriate jurisdictions as
shall be necessary to effectuate the foregoing. Subject to Sections 3.11 and
3.12, the Trustee shall execute a power of attorney to the Servicer or any
Subservicer and furnish them with any other documents as the Servicer or such
Subservicer shall reasonably request in writing to enable the Servicer and such
Subservicer to carry out their respective servicing and administrative duties
hereunder.
The Servicer shall give prompt written notice to the Trustee of any
action, of which the Servicer has actual knowledge, to (i) assert a claim
against the Trust or (ii) assert jurisdiction over the Trust.
Section 3.02 Collection of Mortgage Payments.
The Servicer shall make reasonable efforts to collect all payments
called for under the terms of the Mortgage Loans and shall, to the extent such
procedures shall be consistent with this Agreement and the terms and provisions
of any insurance policy relating to a Mortgage Loan or Mortgaged Property,
follow collection procedures for all Mortgage Loans at least as rigorous as
those applied to similar mortgage loans held in its own portfolio. Consistent
with the foregoing, and unless otherwise provided in Article XII, the Servicer
may in its discretion (a) waive or permit to be waived any late payment charge,
prepayment charge, assumption fee or any penalty interest in connection with the
prepayment of a Mortgage Loan or any other fee or charge that the Servicer would
be entitled to retain as servicing compensation and (b) arrange with a Mortgagor
a schedule for payment of Delinquent sums provided that, if such arrangement is
for a period of more than 90 days, the Servicer reasonably believes that without
such arrangement, the Mortgagor would default on the Mortgage Loan. In addition,
in the event the Servicer shall consent to the deferment of the due date for any
installment due on a Mortgage Loan, such Mortgage Loan shall be considered
Delinquent to the same extent as if such installment had not been deferred.
Section 3.03 Subservicing Agreements.
The Servicer may enter into Subservicing Agreements for the servicing
and administration of Mortgage Loans with any institution which (x) is
authorized under the laws of each state necessary to enable it to perform its
obligations under such Subservicing Agreement and (y) has experience servicing
mortgage loans that are similar to the Mortgage Loans. The Servicer shall give
written notice to the Trustee and the Rating Agencies of the appointment of any
Subservicer (and shall receive the written confirmation of the Rating Agencies
that such appointment shall not result in a withdrawal or downgrading by any
Rating Agency of the then current rating of the Certificates). For purposes of
this Agreement, the Servicer shall be deemed to have received payments on
Mortgage Loans when a Subservicer has received such payments. Each Subservicer
shall be expressly required to service the Mortgage Loans in accordance with
this Agreement, and each Subservicing Agreement shall be consistent with and not
violate the provisions of this Agreement and shall provide that the Trustee (if
acting as successor Servicer) or any other successor Servicer shall have the
right to terminate such agreement without payment of any penalty if the original
Servicer is terminated or resigns. The Servicer shall deliver to the Trustee
copies of all Subservicing Agreements and any amendments or modifications
thereof promptly upon the execution thereof.
Notwithstanding the foregoing, to the extent the Servicer engages any
affiliate or third party vendor pursuant to Section 6.06 or this Section 3.03,
including any Subservicer, in connection with the performance of any of its
duties under this Agreement, the Servicer shall immediately notify the Depositor
in writing of such engagement. To the extent the Depositor notifies the Servicer
and the Trustee that it has determined that any such affiliate, third party
vendor or Subservicer is a Servicing Function Participant, the Servicer shall
cause such Servicing Function Participant to prepare a separate assessment and
attestation report, as contemplated by Section 3.19 of this Agreement and
deliver such report to the Trustee as set forth in Section 3.22 of this
Agreement. In addition, to the extent the Depositor notifies the Servicer and
the Trustee that it has determined that any such Servicing Function Participant
would be a "servicer" within the meaning of Item 1101 of Regulation AB and meets
the criteria in Item 1108(a)(2)(i), (ii) or (iii) of Regulation AB (an
"Additional Servicer"), the Servicer shall cause such Additional Servicer to
prepare a separate compliance statement as contemplated by Section 3.14 of this
Agreement and deliver such statement to the Depositor and the Trustee as set
forth in Section 3.14 of this Agreement.
In addition, if the Depositor determines any such Servicing Function
Participant would be a "servicer" within the meaning of Item 1101 of Regulation
AB, the Servicer shall cause such Servicing Function Participant to provide the
Depositor and the Trustee the information required by Section 1108(b) and
1108(c) of Regulation AB within two Business Days following such engagement. To
the extent the Servicer terminates any such Servicing Function Participant that
the Depositor has determined is a "servicer" within the meaning of Item 1101 of
Regulation AB, the Servicer shall provide the Depositor and the Trustee the
information required to enable the Trustee to accurately and timely report such
event under Item 6.02 of Form 8-K (if the Trust's Exchange Act reporting
requirements have not been suspended pursuant to Section 15(d) of the Exchange
Act as set forth in Section 4.09 of this Agreement).
Section 3.04 No Contractual Relationship.
Any Subservicing Agreement and any other transactions or services
relating to the Mortgage Loans involving a Subservicer shall be between the
Subservicer and the Servicer alone, and the Trustee and the Holders shall not be
deemed parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to any Subservicer except as set forth in Section 3.05.
Section 3.05 Assumption or Termination of Subservicing Agreement.
In connection with the assumption of the responsibilities, duties and
liabilities and of the authority, power and rights of the Servicer hereunder by
the Trustee pursuant to Section 7.01, the Servicer's rights and obligations
under any Subservicing Agreement shall be assumed simultaneously by the Trustee
without act or deed on part of the Trustee; provided, however, that the Trustee
(if acting as successor Servicer) or any other successor Servicer may terminate
the Subservicer as provided in Section 3.03.
The Servicer shall at its expense, upon the reasonable request of the
Trustee, deliver to the assuming party documents and records relating to each
Subservicing Agreement and an accounting of amounts collected and held by it and
otherwise use its best reasonable efforts to effect the orderly and efficient
transfer of the Subservicing Agreements to the assuming party.
Section 3.06 Collection Account; Remittances to Certificate Account.
(a) The Servicer shall establish and maintain at one or more
Depositories the Collection Account to be held as a trust account. Each
Collection Account shall be established in the name of the Trustee, as trustee
for the Holders of the Series of Certificates specified in Article XII. If the
institution at any time holding the Collection Account ceases to be eligible as
a Depository, then the Servicer shall immediately name a successor institution
meeting the requirements for a Depository. If the Servicer fails to name such a
successor institution, then the Collection Account shall thenceforth be held as
a trust account with a qualifying Depository selected by the Trustee. The
Servicer shall notify the Trustee if there is a change in the name, account
number or institution holding the Collection Account.
(b) The Servicer may deposit in the Collection Account the appropriate
payments, collections and funds in respect of one or more series of
certificates issued under a registration statement covering the Certificates
or similar certificates; provided that the senior class of certificates of
each such other series and the senior Class of Certificates are rated either
"AAA" or in the category "AA" or its equivalent by each Rating Agency, and
provided further that separate accounting for each series is maintained.
The Servicer shall not commingle funds and other property in the
Collection Account with any other funds or property of the Servicer or the
Trustee. However, in order to efficiently transfer funds in the Collection
Account to the Certificate Account, so long as CMI is the Servicer, CMI may, on
the Business Day preceding the date on which funds are to be transferred from
the Collection Account to the Certificate Account, transfer those funds to a
commingled clearance account, provided, that if Fitch has rated the
Certificates, CMI may not so commingle funds unless CMI's short-term rating by
Fitch is at least "F1." The clearance account will be under CMI's sole control,
and CMI will maintain adequate records indicating the ownership of the funds in
the clearance account.
(c) The Servicer shall deposit to the Collection Account all Interest
Proceeds, Early Interest Holdover Amounts, Bi-Weekly Interest Holdover
Amounts and Principal Proceeds for a Collection Period, as follows:
(1) within two Business Days of collection, all amounts representing
full or partial Scheduled Payments and Principal Prepayments;
(2) within two Business Days of collection, all amounts representing Net
Liquidation Proceeds, Net Subsequent Recoveries, Loan Repurchase Prices
and Substitution Adjustment Amounts;
(3) not later than the related Deposit Date, all amounts representing
Periodic Interest Advances (subject to clause (y) of the first sentence
in the second paragraph of Section 3.07(a)), and all amounts
representing Compensating Interest, income from REO Properties and any
net investment losses on funds held in the Collection Account as
required by Section 4.03(b);
(4) not later than the related Deposit Date, all amounts required to be
deposited into the Collection Account pursuant to the last sentence of
the first paragraph of Section 3.09(a) (subject to the proviso in such
sentence); and
(5) any other amounts specified in Section 12.07 as being required
deposits to the Collection Account;
minus amounts deposited in the Collection Account representing payments of
principal and/or interest by a Mortgagor which are subsequently returned as
unpaid or "NSF".
The aggregate of the amounts so deposited with respect to a particular
Collection Period (or the corresponding Prepayment Collection Period) pursuant
to this Section 3.06(c) is the "Monthly Deposit Amount" for such Collection
Period; provided, however, that any Early Interest Holdover Amount received
during a Collection Period shall not constitute part of the Monthly Deposit
Amount for such Collection Period but rather shall constitute part of the
Monthly Deposit Amount for the later Collection Period during which such Early
Interest Holdover Amount would have become due if not paid early; provided
further that any Bi-Weekly Interest Holdover Amount for a Collection Period
shall not constitute part of the Monthly Deposit Amount for such Collection
Period; provided further that each Bi-Weekly Interest Holdover Applied Amount
(if any) for a Collection Period shall constitute part of the Monthly Deposit
Amount for such Collection Period; and provided further that the Monthly Deposit
Amount for any Collection Period that is required to be remitted to the
Certificate Account pursuant to Section 3.06(e) shall be reduced by any amounts
withdrawn from the Collection Account pursuant to Section 3.06(d) since the
Distribution Date related to the immediately preceding Collection Period.
The foregoing requirements for deposit in the Collection Account shall
be exclusive. Amounts required to be deposited into the Escrow Account and
(unless otherwise provided in Article XII) amounts in the nature of prepayment
charges, late payment charges, assumption fees, excess interest paid by
Mortgagors and other fees and proceeds of reimbursements of Property Protection
Expenses received with respect to Mortgage Loans need not be deposited by the
Servicer in the Collection Account.
(d) The Servicer may from time to time make withdrawals from the
Collection Account, only for the following purposes:
(A) to pay itself the Servicing Fee;
(B) to withdraw net investment earnings on amounts on deposit in
the Collection Account;
(C) to effect reimbursement for Liquidation Expenses and
Servicing Advances theretofore incurred in respect of any
Mortgage Loan in an amount not to exceed the amount of
Liquidation Proceeds and Subsequent Recoveries deposited in
respect of such Mortgage Loan, to withdraw any Foreclosure
Profits and to pay itself the amounts due under Section 3.11(a)
relating to deficiency actions;
(D) to effect reimbursement for Periodic Interest Advances, the
right to reimbursement pursuant to this clause (D) being limited
to amounts received on particular Mortgage Loans (including, for
this purpose, Insurance Proceeds and Liquidation Proceeds) that
represent late recoveries of payments of principal and/or
interest respecting which any such advance was made;
(E) to effect reimbursement for any Periodic Interest Advances
and Servicing Advances that the Servicer has determined to have
become Nonrecoverable Advances;
(F) to effect reimbursement for advances made on any Mortgage
Loan in payment of taxes, assessments or insurance premiums
(except premiums on any blanket policy referred to in Section
3.09) in any amount not theretofore reimbursed out of the Escrow
Account;
(G) to pay to the Servicer, CRMSI and any of their respective
directors, officers, employees or agents, as applicable, any
amounts in respect of indemnification and hold harmless payments
to which the Servicer, CRMSI and their respective directors,
officers, employees or agents, as the case may be, are entitled
under the third sentence of Section 6.03;
(H) to receive reimbursements permitted under the penultimate
sentence of Section 6.03;
(I) to pay to the Trustee, the Certificate Administrator, the
Paying Agent, the Certificate Registrar, the Authenticating
Agent, the Mortgage Note Custodian, each Depository and any of
their respective directors, officers or employees, as applicable,
any amounts in respect of indemnification and hold harmless
payments to which the Trustee, the Certificate Administrator, the
Paying Agent, the Certificate Registrar, the Authenticating
Agent, the Mortgage Note Custodian, each Depository and their
respective directors, officers or employees, as the case may be,
are entitled under the third sentence of Section 8.05;
(J) to withdraw amounts that have been deposited to the
Collection Account in error; and
(K) to clear and terminate the Collection Account following the
termination of the Trust pursuant to Article IX.
The Servicer shall keep and maintain (or cause to be kept and
maintained) separate accounting records, on a Pool-by-Pool and a Mortgage
Loan-by-Mortgage Loan basis, for the purpose of accounting for withdrawals from
the Collection Account pursuant to clauses (C) and (F) of this Section;
provided, however, that such records need not be retained by the Servicer for a
period longer than its five most recent fiscal years.
(e) The Servicer shall (x) remit for deposit in the Certificate
Account by wire transfer, or otherwise make funds available in immediately
available funds, the Monthly Deposit Amount for a Collection Period not later
than 12:00 noon (New York City time) on the related Distribution Date, and
(y) on each Determination Date, deliver to the Paying Agent a monthly
servicing report, containing (without limitation) the following information
for each Pool and on a combined basis: principal and interest collected in
respect of the Mortgage Loans, scheduled principal and interest that was due
on the Mortgage Loans, relevant information with respect to any Liquidated
Loans, summary and detailed delinquency reports, Liquidation Proceeds and
other similar information concerning the servicing of the Mortgage Loans,
including the information set forth in Section 4.07(b). In addition, the
Servicer shall inform the Trustee on each Determination Date of the amounts
of any Loan Repurchase Prices and Substitution Adjustment Amounts for such
Collection Period.
Section 3.07 Periodic Interest Advances; Servicing Advances.
(a) On each Determination Date, the Servicer (subject to the last
sentence of this paragraph) shall remit for deposit to the Collection Account
out of its own funds any Periodic Interest Advance for the related Collection
Period in respect of each Mortgage Loan. The amount of any Periodic Interest
Advance that the Servicer shall so remit in respect of any Mortgage Loan that is
an REO Mortgage Loan on any Determination Date shall equal the excess, if any,
of the interest portion (net of the related Servicing Fee) of the Scheduled
Payment that would have been due on the related Due Date in respect of such
Mortgage Loan, over the net income from the related REO Property deposited in
the Collection Account pursuant to Section 3.06(c)(3) for distribution on the
related Distribution Date, provided that the Servicer will not elect to make any
such advance on or after the Determination Date related to the Prepayment
Collection Period in which such Mortgage Loan was deemed to be a Liquidated
Loan. The obligation of the Servicer to make any Periodic Interest Advance shall
be contingent on the Servicer's determination, based on its reasonable business
judgment in accordance with the servicing standards set out herein, that the
amount of such Advance will ultimately be recoverable in respect of the related
Mortgage Loan, upon liquidation, from insurance or otherwise; the Servicer shall
not be obligated to make any Periodic Interest Advance that it deems to be a
Nonrecoverable Advance.
If the Servicer determines that it is obligated to make any Periodic
Interest Advance for a particular Collection Period, it shall either (x) deposit
into the Collection Account an amount equal to such Periodic Interest Advance no
later than the related Deposit Date pursuant to Section 3.06(c)(iii) or (y) make
an appropriate entry in its records relating to the Collection Account that any
portion of the Amount Held for Future Distribution (if any) has been used by the
Servicer in discharge of its obligation to make such Periodic Interest Advance
on such Deposit Date. Any Amount Held for Future Distribution that is so applied
for any Deposit Date pursuant to clause (y) shall be replaced by the Servicer by
deposit into the Collection Account no later than the immediately following
Deposit Date. The Servicer is entitled to reimbursement from the Collection
Account for each Periodic Interest Advance made pursuant to this Section 3.07(a)
as provided in Section 3.06(d)(D).
If the Servicer determines that Periodic Interest Advances previously
made on a Mortgage Loan have become Nonrecoverable Advances, the Servicer may
reimburse itself for the amount of such Nonrecoverable Advances as provided in
Section 3.06(d)(E) and from related Liquidation Proceeds. The Servicer shall
give written notice (in the form of an Officer's Certificate) of its
determination of nonrecoverability and the factual basis therefor to the
Trustee.
(b) The Servicer will pay all "out-of-pocket" costs and expenses
incurred in the performance of its servicing obligations, including, but not
limited to, (i) Property Protection Expenses, (ii) the cost of any
enforcement or judicial proceedings, including foreclosures, (iii) the cost
of the management and liquidation of REO Property, (iv) advances required by
Section 3.11(a), but only to the extent that such amounts are determined by
the Servicer in its reasonable business judgment to be recoverable, (v)
amounts required to be deposited into the Certificate Account pursuant to the
last sentence of Section 3.09(a), but only to the extent that such amounts
are determined by the Servicer in its reasonable business judgment to be
recoverable, and (vi) expenses incurred and funds advanced pursuant to
Section 3.18. The Servicer may recover a Servicing Advance (x) from the
Mortgagor to the extent permitted by the Mortgage Loan or, if not theretofore
recovered from such Mortgagor, from Liquidation Proceeds realized upon the
liquidation of the related Mortgage Loan and (y) as provided in Section
3.06(d). The Servicer shall be entitled to recover Servicing Advances from
Liquidation Proceeds prior to the deposit of the Liquidation Proceeds
hereunder.
Section 3.08 Compensating Interest.
If one or more Prepayment Interest Shortfalls occurs with respect to a
Mortgage Loan during any Collection Period, an amount equal to the aggregate of
such Prepayment Interest Shortfalls for such Mortgage Loan, up to an aggregate
amount not in excess of the Maximum Compensating Interest Amount for such
Collection Period shall be deposited by the Servicer to the Collection Account.
The amount required to be deposited by the Servicer to the Collection Account
pursuant to the immediately preceding sentence in respect of any Collection
Period is referred to herein collectively as the "Compensating Interest" for
such Collection Period. The aggregate amount of Compensating Interest required
to be deposited by the Servicer to the Collection Account for any Collection
Period shall be limited to the Maximum Compensating Interest Amount for such
Collection Period.
Section 3.09 Maintenance of Insurance.
(a) To the extent the Servicer is permitted to do so under a Mortgage
Loan (but only to the extent consistent with the Servicer's servicing of its own
loan portfolio), the Servicer shall cause to be maintained for each Mortgage
Loan a hazard insurance policy that provides for fire and extended coverage, and
which provides for a recovery of insurance proceeds relating to such Mortgage
Loan, in an amount not less than the least of (i) the Unpaid Loan Balance (plus
the related senior lien loan, if any), (ii) the minimum amount required to
compensate for damage or loss on a replacement cost basis and (iii) the full
insurable value of the premises. The Servicer shall maintain such insurance
policies in the name of the Servicer for the benefit of the Trustee. The
policies shall require the insurer to provide the mortgagee with 30 days' notice
prior to any cancellation or as otherwise required by law. The Servicer may also
(but is not obligated to) maintain a blanket hazard insurance policy or policies
if the insurer or insurers of such policies are acceptable to each Rating
Agency, in which case the Servicer shall conclusively be deemed to have
satisfied its obligations under this Section 3.09(a). If such a blanket policy
contains a deductible clause, the Servicer shall deposit in the Collection
Account, in accordance with Section 3.06(c)(4), any amount not payable under the
blanket policy during any Collection Period because of the deductible clause
that would have been paid under a hazard policy that meets the requirements of
this Section 3.09(a) and does not have a deductible clause; provided, however,
that the Servicer's obligation so to deposit any such amount shall exist only if
and to the extent that the Servicer determines, in its reasonable business
judgment, such deposit to be recoverable as a Servicing Advance in accordance
with Section 3.07(b).
If the Mortgage Loan at the time of origination (or if required by
federal law, at any time thereafter) relates to a Mortgaged Property in an area
identified in the Federal Register by the Federal Emergency Management Agency as
having special flood hazards, then to the extent the Servicer is permitted to do
so under the Mortgage Loan (but only to the extent consistent with the
Servicer's servicing of its own loan portfolio), the Servicer will cause to be
maintained thereon a flood insurance policy in a form meeting the requirements
of the then current guidelines of the Federal Insurance Administration in an
amount representing coverage, and which provides for a recovery of insurance
proceeds relating to such Mortgage Loan, of not less than the least of (i) the
Unpaid Loan Balance of the Mortgage Loan (plus the related senior lien loan, if
any), (ii) the minimum amount required to compensate for damage or loss on a
replacement cost basis and (iii) the maximum amount of insurance that is
available under the Flood Disaster Protection Act of 1973. The Servicer shall
indemnify the Trust for any loss to the Trust resulting from the Servicer's
failure to advance premiums for such insurance required by this Section.
The Servicer shall have no obligation to maintain or cause to be
maintained any earthquake or additional insurance on a Mortgage Loan or
Mortgaged Property unless the related Mortgagor is required under applicable law
to maintain such insurance.
Section 3.10 Due-on-Sale Clauses; Assumption and Substitution.
When a Mortgaged Property has been or is about to be conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in the related
Mortgage or Mortgage Note; provided, however, that the Servicer need not
exercise any such right if (a) the Person to whom the Mortgaged Property has
been or is to be conveyed satisfies the terms and conditions in the Mortgage
Note and Mortgage and the consent of the mortgagee thereunder is not required or
(b) the "due-on-sale" clause is, in the reasonable belief of the Servicer, not
enforceable under applicable law. An Opinion of Counsel, provided at the expense
of the Servicer, to the foregoing effect shall conclusively establish the
reasonableness of such belief. In such event, the Servicer shall enter into an
assumption and modification agreement with the transferee to whom such property
has been or is about to be conveyed, pursuant to which such transferee becomes
liable under the Mortgage Note and, unless prohibited by applicable law or the
Mortgage, the original Mortgagor remains liable thereon. If the foregoing is not
permitted under applicable law, the Servicer is authorized to enter into a
substitution of liability agreement with such transferee, pursuant to which the
original Mortgagor is released from liability and such transferee is substituted
as Mortgagor and becomes liable under the Mortgage Note. The Servicer shall add
the original copy of such assumption or substitution agreement to the related
Mortgage File and which shall, for all purposes, be considered a part of such
Mortgage File to the same extent as all other documents and instruments
constituting a part thereof. The Servicer shall be responsible for any required
recording of any assumption or substitution agreement. In connection with any
assumption or substitution agreement, no material term of the Mortgage Loan
(including, without limitation, the Scheduled Payment, the stated maturity, the
Loan Balance or the Mortgage Note Rate) shall be changed, nor shall any required
periodic payments of principal or interest be deferred or forgiven. Any fee
collected for consenting to any such conveyance or entering into an assumption
or substitution agreement shall be retained by or paid to the Servicer as
additional servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan, or any substitution of liability agreement or any other transfer
of a Mortgaged Property without assumption thereof, by operation of law or by
reason of any assumption or transfer (x) which the Servicer may be restricted by
law from preventing, or (y) which, if prevented, would adversely affect the
coverage under any mortgage pool insurance policy, hazard insurance policy or
any Primary Mortgage Insurance Certificate, for any reason whatsoever.
Section 3.11 Realization Upon Defaulted Mortgage Loans; Workouts.
(a) The Servicer may foreclose upon or otherwise comparably convert the
ownership in the name of, or on behalf of, the Trustee on behalf of the Trust
Fund of Mortgaged Properties relating to defaulted Mortgage Loans as to which no
satisfactory arrangements can be made for collection of Delinquent payments. The
decision of the Servicer whether to foreclose on a defaulted Mortgage Loan shall
be subject to its determination that the proceeds of foreclosure would exceed
the costs and expenses of bringing such a proceeding; such determination to be
based upon a recent appraisal, brokers price opinion or other evidence of the
property's current fair market value and the Servicer's recent experience in
realizing on similar properties similarly located. In connection with such
foreclosure or other conversion, the Servicer shall exercise such of the rights
and powers vested in it hereunder, and use the same degree of care and skill in
their exercise or use, as prudent mortgage lenders would exercise or use under
the circumstances in the conduct of their own affairs and consistent with
applicable law and with its normal and customary servicing standards, including,
but not limited to, advancing funds for the payment of taxes, amounts due with
respect to Senior Liens, and insurance premiums. In the event a deficiency
action is available against the Mortgagor or any other person, the Servicer may
proceed for the deficiency. The Servicer may retain twenty-five percent (25%) of
the net proceeds received pursuant to a deficiency action as compensation for
entering into such action.
The Servicer shall sell any REO Property prior to the close of the third
calendar year beginning after the year of its acquisition by the Trust Fund, at
such price as the Servicer in good xxxxx xxxxx necessary to comply with this
covenant unless (i) the Servicer obtains for the Trustee an Opinion of Counsel
(the expense of which opinion shall be a Servicing Advance) experienced in
federal income tax matters and acceptable to the Trustee, addressed to the
Trustee and the Servicer, to the effect that the holding by the Trust Fund of
such REO Property for any greater period will not result in the imposition of
taxes on "prohibited transactions" of the Trust Fund or of any Constituent REMIC
as defined in Code Section 860F or cause any Constituent REMIC to fail to
qualify as a REMIC at any time that any Certificates are outstanding or (ii) the
Servicer shall have applied for an extension of time in the manner contemplated
by Code Section 856(e)(3), in which case such three-year period shall be
extended by the applicable period. The Servicer shall manage, conserve, protect
and operate each REO Property solely for the purpose of its prompt disposition
and sale in a manner which does not cause such REO Property to fail to qualify
as "foreclosure property" within the meaning of Code Section 860G(a)(8) or
result in the receipt by any Constituent REMIC of any "income from non-permitted
assets" within the meaning of Code Section 860F(a)(2)(B) or any "net income from
foreclosure property" which is subject to taxation under the REMIC Provisions.
In its efforts to sell such REO Property, the Servicer shall, either itself or
through an agent, protect and conserve such REO Property in the same manner and
to such extent as is customary in the locality where such REO Property is
located and may, incident to its conservation and protection, rent the same or
any part thereof as the Servicer deems appropriate for the period prior to the
sale of such REO Property.
The Servicer shall take into account the existence of any hazardous
substances, hazardous wastes or solid wastes, as such terms are defined in the
Comprehensive Environmental Response, Compensation, and Liability Act, the
Resource Conservation and Recovery Act of 1976, or other federal, state or local
environmental legislation, on a Mortgaged Property in determining whether to
foreclose upon or otherwise comparably convert the ownership of such Mortgaged
Property. The Servicer shall be under no obligation to foreclose upon or
otherwise convert the ownership of any Mortgaged Property which it believes may
be contaminated with or affected by solid wastes, hazardous wastes, hazardous
substances or other pollutants. The Servicer shall not be liable to the Holders
if, based on its belief that no such contamination or effect exists, the
Servicer forecloses on a Mortgaged Property and takes title to such Mortgaged
Property, and thereafter such Mortgaged Property is determined to be so
contaminated or affected.
In any case in which property subject to a Mortgage shall have suffered
damage, the Servicer shall not be required to expend its own funds in connection
with any foreclosure or towards the restoration of such property unless it shall
determine in its discretion (a) that such restoration and/or foreclosure will
increase the net proceeds of liquidation of the related Mortgage Loan after
reimbursement to itself for such expenses and (b) that such expenses will be
recoverable by it through either Liquidation Proceeds or Insurance Proceeds
(with respect to each of which it shall have priority for purposes of
withdrawals from the Collection Account, as contemplated in Section 3.06(d)).
The Servicer shall be responsible for all other costs and expenses incurred by
it in any such proceedings; provided, however, that it shall be entitled to
reimbursement thereof, as contemplated in Section 3.06(d). The Servicer shall
not, however, be entitled to recover legal expenses incurred in connection with
liquidation proceedings where the Mortgagor pays all Delinquent payments and
expenses and such proceedings are terminated prior to liquidation, other than
sums received from the Mortgagor for such expenses.
In the event the Servicer does not elect to foreclose on a Mortgaged
Property, the Servicer may, in the exercise of its judgment, elect to accept a
payment or payments, in connection with the sale by the Mortgagor of such
Mortgaged Property or the retention by the Mortgagor of such Mortgaged Property,
in aggregate amount less than the outstanding balance of the related Mortgage
Loan and accrued interest thereon.
The Trustee shall furnish the Servicer with any powers of attorney and
other documents necessary or appropriate to enable the Servicer to carry out its
efforts in realizing upon defaulted Mortgage Loans hereunder.
In addition to the foregoing provisions, the Servicer may enter into a
special servicing agreement covering any one or more Mortgage Loans in default.
Such special servicing agreement shall be subject to each Rating Agency's
written acknowledgement that the ratings of the Certificates in effect
immediately prior to the entering into of such agreement would not be qualified,
downgraded or withdrawn and the Certificates would not be placed on credit
review status (except for possible upgrading) as a result of such an agreement.
(b) The Servicer shall determine for each defaulted Mortgage Loan at
what time it has recovered, whether through trustee's sale, foreclosure sale or
otherwise, all amounts it expects to recover from or on account of such
defaulted Mortgage Loan, whereupon such Mortgage Loan shall become a "Liquidated
Loan".
(c) The Servicer shall not agree to any modification, waiver, variance
or amendment of any provision of any Mortgage Loan unless, in the Servicer's
good faith judgment, such modification, waiver, variance or amendment would
mitigate the loss that might otherwise be experienced on such Mortgage Loan and
only in the event of a default on such Mortgage Loan or in the event that a
default on such Mortgage Loan is reasonably foreseeable; provided, however, that
no such modification, waiver, variance or amendment shall extend the maturity
date of such Mortgage Loan beyond the Collection Period relating to the latest
Last Scheduled Distribution Date of any Class of Outstanding Certificates. The
Servicer shall be permitted to modify, waive, vary or amend any provision of a
Mortgage Loan if required by statute or a court of competent jurisdiction to do
so.
(d) The Servicer shall cause an original counterpart of such
modification, waiver or amendment, promptly following the execution thereof to
be deposited in the related Mortgage File to be held in trust for the Trustee.
Section 3.12 Trustee to Cooperate; Release of Files.
(a) Upon the payment in full of any Mortgage Loan (including any
liquidation of such Mortgage Loan through foreclosure or otherwise), or the
receipt by the Servicer of a notification that payment in full will be escrowed
in a manner customary for such purposes, the Servicer shall deliver to the
Mortgage Note Custodian and the Trustee a "Request for Release of Documents"
(substantially in the form of Xxxxxx Xxx Form 2009). Upon receipt of such
Request for Release, the Mortgage Note Custodian, acting for the Trustee, shall
promptly release the related Mortgage Note, in trust, to the Servicer or its
designee. In addition, the Servicer, acting for the Trustee, shall release the
remainder of the related Mortgage File. In these circumstances, the Servicer is
authorized to give, as attorney-in-fact for the Trustee and the mortgagee under
the Mortgage, an instrument of satisfaction (or assignment of Mortgage without
recourse) regarding the related Mortgaged Property, which instrument of
satisfaction or assignment shall be delivered to the Person or Persons entitled
thereto against receipt of payment in full. No expense incurred in connection
with such instrument of satisfaction or assignment shall be chargeable to the
Collection Account or to the Trustee. In lieu of executing any such satisfaction
or assignment, the Servicer may prepare and submit to the Trustee a satisfaction
(or assignment without recourse, if requested by the Person or Persons entitled
thereto) in form for execution by the Trustee with all requisite information
completed by the Servicer; in such event, the Trustee shall execute and
acknowledge such satisfaction or assignment, as the case may be, and deliver the
same with the related Mortgage File, as aforesaid.
(a) The Servicer shall have the right to accept applications by
Mortgagors for consent to (i) partial releases of Mortgaged Properties, (ii)
easements or alterations and (iii) removal, demolition or division of properties
subject to Mortgages. No application shall be approved by the Servicer unless:
(w) the effect of such application would not cause any Constituent REMIC to fail
to qualify as a REMIC, and would not result in the imposition of any tax on
"prohibited transactions" of the Trust Fund or any Constituent REMIC, (x) the
provisions of the related Mortgage Note and Mortgage have been complied with;
(y) the debt-to-income ratio of the Mortgagor after any release does not exceed
the debt-to-income ratio of such Mortgagor on the Cut-Off Date and any increase
in the Loan-to-Value Ratio shall not exceed 5%; and (z) the lien priority of the
related Mortgage is not adversely affected. Upon receipt by the Trustee of an
Officer's Certificate of the Servicer setting forth the action proposed to be
taken for a particular Mortgage Loan and certifying that the criteria set forth
in the preceding sentence have been satisfied, the Trustee shall execute and
deliver to the Servicer the consent or partial release prepared by the Servicer.
Section 3.13 Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to retain the related Servicing Fee with respect to each Mortgage Loan.
Additional servicing compensation in the form of release fees, bad check
charges, assumption fees, late payment charges, or any other servicing-related
fees, Net Liquidation Proceeds or Net Subsequent Recoveries not required to be
deposited in the Collection Account and similar items may, to the extent
collected from Mortgagors, be retained by the Servicer, unless a successor
Servicer is appointed pursuant to Section 7.01, in which case the provisions of
Section 7.01(g) shall apply.
The right to receive the Servicing Fee may not be transferred in whole
or in part except in connection with the transfer of all of the Servicer's
responsibilities and obligations under this Agreement.
Section 3.14 Annual Statement of Compliance.
The Servicer shall deliver, and the Servicer shall cause each
Subservicer engaged by it to deliver, to the Depositor, the Trustee and each
Rating Agency on or before March 1 of each year or if such day is not a Business
Day, the next Business Day, commencing in March 2008, a certificate in the form
required by Item 1123 of Regulation AB, to the effect that (i) an authorized
officer of the Servicer or the Additional Servicer, as the case may be, has
reviewed (or a review has been made under his or her supervision of) such
party's activities under this Agreement, or such other applicable Subservicing
Agreement in the case of an Additional Servicer, during the prior calendar year
or portion thereof and (ii) to the best of such officer's knowledge, based on
such review, such party has fulfilled all of its obligations under this
Agreement, or such other applicable Subservicing Agreement in the case of an
Additional Servicer, in all material respects throughout the prior calendar year
or portion thereof or, if there has been a failure to fulfill any such
obligation in any material respect, specifying each such failure known to such
officer and the nature and status thereof. Promptly after receipt of each such
certificate, the Depositor shall review such certificate and, if applicable,
consult with the Servicer as to the nature of any failure to fulfill any
obligation under the Agreement, or such other applicable Subservicing Agreement
in the case of an Additional Servicer, in any material respect.
Section 3.15 Assessments of Compliance and Attestation Reports.
(a) Each of the Servicer, the Paying Agent, the Mortgage Note Custodian
and the Certificate Administrator, at its own expense, shall deliver to the
Depositor, and shall cause each Servicing Function Participant engaged by such
party to deliver to the Depositor, on or before March 1 of each year for which a
Form 10-K is required to be filed, or if such day is not a Business Day, the
next Business Day, a report (an "Assessment of Compliance") regarding the
Servicer's, Paying Agent's, Mortgage Note Custodian's, Certificate
Administrator's or other Servicing Function Participant's, as applicable,
assessment of compliance with, at a minimum, the Relevant Servicing Criteria for
such party during the preceding calendar year, as required by Rules 13a-18 and
15d-18 of the Exchange Act and Item 1122 of Regulation AB promulgated under the
Act. Each such Assessment of Compliance delivered by each such party shall
contain:
(i) a statement by such party of its responsibility for assessing
compliance with the Servicing Criteria applicable to it;
(ii) a statement that such party used the Servicing Criteria
applicable to it to assess compliance with the Servicing Criteria;
(iii) such party's assessment of compliance with the Servicing
Criteria applicable to it as of and for the preceding fiscal year,
including, if there had been any material instance of noncompliance with
the Servicing Criteria applicable to it, identifying each such failure
and the nature and status thereof; and
(iv) a statement that a registered public accounting firm has
issued an attestation report on such party's assessment of compliance
with the Servicing Criteria applicable to it as of and for the preceding
fiscal year.
For each of the Servicer, the Paying Agent, the Mortgage Note Custodian and the
Certificate Administrator, the "Relevant Servicing Criteria" with respect to
such party shall be the servicing criteria set forth opposite its name on
Schedule 1; provided, that Schedule 1 may be modified (x) by the agreement of
CRMSI and each party affected by such modification, without the consent of any
other party or the Certificateholders, and (y) by CRMSI, without the consent of
any other party or the Certificateholders, if CRMSI is advised by counsel that
such change may be required to comply with Regulation AB. For any other
Servicing Function Participant engaged by the Servicer, the Paying Agent, the
Mortgage Note Custodian or the Certificate Administrator, "Relevant Servicing
Criteria" refers to the portion of the Relevant Servicing Criteria applicable to
the party engaging such Servicing Function Participant insofar as the functions
required to be performed by such party are to be performed by the Servicing
Function Participant. For the avoidance of doubt, multiple parties can have
responsibility for the same Relevant Servicing Criteria.
(b) On or before March 1 of each year for which a Form 10-K is
required to be filed, or if such day is not a Business Day, the next Business
Day, each of the Servicer, the Paying Agent, the Mortgage Note Custodian and
the Certificate Administrator, at its own expense, shall furnish to the
Depositor, and shall cause each Servicing Function Participant engaged by
such party to deliver to the Depositor, a report (an "Attestation Report") of
a registered public accounting firm that attests to, and reports on, the
Assessment of Compliance made by the Servicer, the Paying Agent, the Mortgage
Note Custodian, the Certificate Administrator or another Servicing Function
Participant, as applicable, as required by Rules 13a-18 and 15d-18 of the
Exchange Act and Item 1122(b) of Regulation AB promulgated under the Act,
which Attestation Report must be made in accordance with standards for
attestation reports issued or adopted by the Public Company Accounting
Oversight Board.
(c) No later than 30 days following the end of each fiscal year for
the Trust for which a Form 10-K is required to be filed, (i) the Servicer and
the Certificate Administrator shall forward to the Depositor the name of each
Servicing Function Participant engaged by it and what servicing criteria will
be addressed in the report on assessment of compliance prepared by such
Servicing Function Participant and (ii) each of the Paying Agent and the
Mortgage Note Custodian shall forward to the Depositor and the Servicer the
name of each Servicing Function Participant engaged by it and what servicing
criteria will be addressed in the report on assessment of compliance prepared
by such Servicing Function Participant, in each case to the extent of any
change from the prior year's notice, if any.
(d) So long as the Servicer and the Certificate Administrator are the
same party: (x) the obligations of the Servicer and Certificate Administrator
to deliver Assessments of Compliance pursuant to Section 3.15(a) may be
satisfied through the delivery of a joint Assessment of Compliance that
satisfies the obligations of both the Servicer and the Certificate
Administrator; and (y) the obligations of the Servicer and Certificate
Administrator to furnish Attestation Reports pursuant to Section 3.15(b) may
be satisfied through the furnishing of a joint Attestation Report that
satisfies the obligations of both the Servicer and the Certificate
Administrator.
Section 3.16 Access to Loan Documentation and Information.
The Servicer will provide Holders that are federally insured savings and
loan associations with certain reports, and will provide access to information
and documentation regarding the Mortgage Loans included in the Trust Fund,
sufficient to permit such associations to comply with applicable regulations of
the Office of Thrift Supervision or the FDIC. The Servicer shall provide to the
Trustee and the Certificate Administrator access to the information and
documentation regarding the Mortgage Loans, such access being afforded without
charge but only upon reasonable request and during normal business hours at the
offices of the Servicer designated by it.
Section 3.17 Errors and Omissions Insurance.
The Servicer (including the Trustee if it shall become the Servicer
hereunder) agrees to maintain errors and omissions coverage and a fidelity bond,
each at least to the extent required by Section 305 of Part I of the Xxxxxx Xxx
Guide or any successor provision thereof. If the fidelity bond or the errors and
omissions coverage ceases to be in effect, the Servicer shall promptly give
notice thereof to the Trustee and the Holders.
Section 3.18 [Reserved].
Section 3.19 Prepayment Charges.
If this Section 3.19 is stated to be applicable in Article XII, then the
Servicer will not waive all or any part of any Prepayment Charge unless, in the
Servicer's reasonable judgment, such waiver would maximize recovery of total
proceeds taking into account the value of such Prepayment Charge and the related
Mortgage Loan and giving such waiver is standard and customary in the industry
under similar circumstances in connection with mortgage loan servicing. Subject
to the foregoing, the Servicer will not waive all or any part of a Prepayment
Charge in connection with the refinancing of a Mortgage Loan unless such
refinancing is related to a default or a reasonably foreseeable default.
If the Servicer shall waive all or any part of a Prepayment Charge in
violation of the standard set forth in the preceding paragraph, then the
Servicer shall, on the second Business Day preceding the next Deposit Date,
deposit out of its own funds the amount so waived into the Collection Account.
Section 3.20 Escrow Account.
To the extent permitted by the related Mortgage Note, the Servicer may
(but is not obligated to) establish and maintain or cause to be established and
maintained with Depositories one or more Escrow Accounts and shall deposit
therein all collections of taxes, assessments, primary mortgage or hazard
insurance premiums or comparable items for the account of the Mortgagors.
Withdrawals from an Escrow Account may be made only to effect payment of taxes,
assessments, primary mortgage or hazard insurance premiums or comparable items,
to reimburse the Servicer out of related collections for any payments made
regarding taxes and assessments, premiums on Primary Mortgage Insurance
Certificates and premiums on standard hazard insurance policies, to refund to
any Mortgagors any sums determined to be overages, to pay interest owed to
Mortgagors on such Account to the extent required by law or to clear and
terminate such Accounts at the termination of this Agreement. Escrow Accounts
shall not be part of the Trust Fund.
Section 3.21 Refinancings of Mortgage Loans.
In addition to waivers and arrangements permitted by Section 3.11, the
Servicer reserves the right to offer refinancings of any Mortgage Loan, if such
refinancing arises out of a request by the related Mortgagor for a refinancing
or a modification, or for other relief from the provisions of the related
Mortgage Loan. For the purposes of this Section, a "refinancing" will include
any process with a Mortgagor that results in the refinanced Mortgage Loan being
identified and serviced as a "new mortgage loan" in the books, records and
servicing files of the Servicer.
On the Deposit Date for the Collection Period in which occurred the
effective date of the refinancing of any Mortgage Loan pursuant to this Section,
the Servicer shall deposit, or cause to be deposited, into the Collection
Account an amount equal to the prepayment in full of such Mortgage Loan (net of
all Servicing Advances and Periodic Interest Advances relating to such Mortgage
Loan, which shall be deemed reimbursed to the Servicer) and, upon receipt by the
Trustee and Mortgage Note Custodian of written notification of such deposit
signed by a Servicing Officer, the Trustee will promptly direct the Mortgage
Note Custodian to release the related Mortgage Note, in trust, to the Servicer
or its designee, and the Mortgage Note Custodian and the Trustee shall comply
with the provisions of Section 3.12. In addition, upon such deposit, the
Servicer, on behalf of the Trustee, shall release the remainder of the related
Mortgage File.
ARTICLE IV
ACCOUNTS AND DISTRIBUTIONS
Section 4.01 Collection of Money.
The Paying Agent shall demand payment or delivery of all money and other
property payable to or receivable by the Paying Agent pursuant to this
Agreement, including all payments due on the Mortgage Loans in accordance with
the respective terms and conditions of such Mortgage Loans and required to be
paid over to the Paying Agent by the Servicer or by any Subservicer. The Paying
Agent shall hold all such money and property received by it, other than pursuant
to or as contemplated by Section 4.10, as part of the Trust Fund and shall apply
it as provided in this Agreement.
Section 4.02 Certificate Account.
The Depositor shall cause to be established with the Paying Agent by the
Issue Date, and the Paying Agent on behalf of the Trustee shall maintain, the
Certificate Account to be held by the Paying Agent on behalf of the Trustee as
trustee for the Holders of the specific Series of Certificates identified in
Article XII. The Paying Agent shall deposit in the Certificate Account, upon
receipt, all amounts paid to it pursuant to Section 3.06(e).
Section 4.03 Investment of Accounts.
(a) Consistent with any requirements of the Code, all or a portion of
any Investment Account shall be invested and reinvested in the name of the Trust
Fund, as directed in writing by the Depositor, in one or more Eligible
Investments bearing interest or sold at a discount. The Trustee and a Paying
Agent (in each case acting in its commercial capacity) may be the obligor on any
investment which otherwise qualifies as an Eligible Investment. Except as
otherwise provided in this Section 4.03, no investment in any Investment Account
shall mature later than the Business Day immediately preceding the next
Distribution Date.
If the Depositor shall fail to give investment directions to the Paying
Agent, amounts in the accounts maintained with the Paying Agent shall remain
uninvested.
If any amounts are needed for disbursement from any Investment Account
held by the Paying Agent and sufficient uninvested funds are not available to
make such disbursement, the Paying Agent shall cause to be sold or otherwise
converted to cash a sufficient amount of the investments in such Account. No
investments will be liquidated prior to maturity unless the proceeds thereof are
needed for disbursement.
The Trustee and the Paying Agent shall have no liability for any loss
incurred in connection with any investment or any sale or liquidation thereof,
or for any insufficiency in any Investment Account, except for any such loss or
insufficiency caused by its own negligence or willful misconduct.
(b) (i) If the Collection Account is an Investment Account, then all
funds therein shall be held (i) uninvested up to the amount insured by the
FDIC or (ii) invested in Eligible Investments. Any investments of funds in
the Collection Account shall mature or be withdrawable at par on or prior to
the immediately succeeding Deposit Date. Any investment earnings on funds
held in the Collection Account shall be for the account of the Servicer and
may only be withdrawn from the Collection Account by the Servicer immediately
following the remittance of the Monthly Deposit Amount. Any investment losses
on funds held in the Collection Account shall be for the account of the
Servicer and promptly upon the realization of such loss shall be contributed
by the Servicer to the Collection Account. Any references herein to amounts
on deposit in the Collection Account shall refer to amounts net of investment
earnings.
(ii) If the Certificate Account is an Investment Account, then
funds therein shall be invested and reinvested by the Paying Agent at
the Depositor's written direction in one or more Eligible Investments
bearing interest or sold at discount. No investment of any amount held
in the Certificate Account may mature later than the Business Day
immediately preceding the next Distribution Date; provided, however,
that investments (including repurchase agreements) on which the Trustee
or the Paying Agent, in its commercial capacity, is the obligor, may
mature on a Distribution Date.
All income from investment of moneys deposited in the Certificate
Account, and all proceeds of disposition of any assets in the Certificate
Account, shall be deposited in the Certificate Account immediately upon receipt,
and any loss resulting from such investment shall be charged to the Certificate
Account.
(c) The Depositor will not direct the Trustee or the Paying Agent to
make any investment of any funds or to sell any investment held in an
Investment Account except under the following terms and conditions:
(i) each such investment shall be made in the name of the Trustee
(in its capacity as such) or in the name of a Qualified Nominee of the
Trustee; and
(ii) each such investment shall be a "cash flow investment" as
defined in Code Section 860G(a)(6).
(d) Generally, no Eligible Investment shall be disposed of prior to
its maturity; provided, however, if any amounts are needed for disbursement
from an Investment Account and sufficient uninvested funds are not available
therein to make such disbursement, in the absence of a Depositor Order for
the liquidation of investments held therein in an amount sufficient to
provide the required funds, the Paying Agent shall cause to be sold or
otherwise converted to cash a sufficient amount of the investments in such
Investment Account; provided, further, however, that prior to any such sale
or conversion to cash, the Trustee or the Paying Agent shall have received
(i) an Opinion of Counsel that such sale or conversion to cash shall not
constitute a "prohibited transaction" under Code Section 860F(a), or (ii) (a)
if such sale or conversion to cash constitutes such a "prohibited
transaction", the consent of the Holders of 100% Percentage Interest of the
Residual Certificates to the prohibited transaction together with each such
Holder's proportionate share of any tax imposed on the Trust Fund
attributable to such transaction and (b) an Opinion of Counsel that such
transaction will not disqualify any Constituent REMIC as a REMIC.
Section 4.04 [Reserved].
Section 4.05 Eligible Investments.
The following are Eligible Investments:
(a) direct obligations of, and obligations fully guaranteed by, the
United States of America, Xxxxxxx Mac, Xxxxxx Xxx, the Farm Credit Banks, the
Federal Home Loan Banks, the Student Loan Marketing Association (but only for
obligations backed by letters of credit or senior obligations) or any agency
or instrumentality of the United States of America the obligations of which
are backed by the full faith and credit of the United States of America;
provided, however, that any obligation of, or guaranteed by, the Federal Home
Loan Banks or the Farm Credit Banks or any obligation of, or guaranteed by,
Xxxxxxx Mac or Xxxxxx Xxx, other than a senior debt obligation of Xxxxxxx Mac
or Xxxxxx Xxx or a mortgage participation or pass-through certificate
guaranteed by Xxxxxxx Mac or Xxxxxx Xxx, excluding stripped mortgage
securities which are valued greater than par on the portion of unpaid
principal, shall be an Eligible Investment only if, at the time of
investment, each Rating Agency confirms in writing that such investment is
acceptable;
(b) Federal Funds, demand and time deposits in, certificates of
deposits of, or bankers' acceptances issued by, any depository institution or
trust company (including the Trustee or any agent of the Trustee, acting in
their respective commercial capacities) incorporated under the laws of the
United States of America or any state thereof and subject to supervision and
examination by federal or state banking authorities, so long as at the time
of such investment or contractual commitment providing for such investment
the certificate of deposit or other unsecured short-term debt obligations of
such depository institution or trust company have a maturity of not more than
one year and a credit rating of not less than "A-1+" ("A-1" if the maturity
is not greater than 30 days) by S&P if S&P is a Rating Agency, "P-1" by
Moody's if Xxxxx'x is a Rating Agency, and "F-1" by Fitch if Fitch is a
Rating Agency; each such investment being expressly authorized and deemed
authorized by a certificate holder's purchase or acceptance of any
certificate when acting in the capacity of a fiduciary (including a
"fiduciary" of an "employee benefit plan" subject to ERISA, as those term are
defined in Sections 3(21) and 3(3) of ERISA, respectively) which purchase or
acceptance shall also evidence and be deemed to evidence any such certificate
holder's representation and warranty to the Certificate Administrator, the
Certificate Registrar and the Trustee and any agent of the Trustee that such
certificate holder is duly authorized by and empowered under appropriate
governing instruments (for example, an employee benefit plan, in the case of
an ERISA fiduciary) to give such authorization; and money market funds
investing exclusively in any of the investments discussed in this definition
of Eligible Investments with a rating of not less than "A-1+" ("A-1" if the
maturity is not greater than 30 days) by S&P if S&P is a Rating Agency, "F-1"
by Fitch if Fitch is a Rating Agency, and "P-1" by Moody's if Xxxxx'x is a
Rating Agency;
(c) repurchase obligations for (i) any security described in clause
(a) above or (ii) any other security issued or guaranteed by an agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America, in
either case where such security has a remaining maturity of one year or less
and where such repurchase obligation has been entered into with a depository
institution or trust company (acting as principal) with a rating of not less
than "A-1+" by S&P if S&P is a Rating Agency, "P-1" by Moody's if Xxxxx'x is
a Rating Agency, and "F-1" by Fitch if Fitch is a Rating Agency;
(d) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America or
any state thereof which have a maturity not greater than 30 days and an
unsecured long-term debt rating of at least "AA" if S&P is a Rating Agency,
"AA" if Fitch is a Rating Agency, and "Aa" if Xxxxx'x is a Rating Agency, or
an unsecured short-term debt rating, of at least "A-1" if S&P is a Rating
Agency, "F-1" if Fitch is a Rating Agency, and "P-1" if Xxxxx'x is a Rating
Agency, at the time of such investment or contractual commitment providing
for such investment; provided, however, that securities issued by any
particular corporation shall not be Eligible Investments to the extent that
investment therein shall cause the then outstanding principal balance of
securities issued by such corporation and held as part of the Trust Fund to
exceed 10% of the aggregate current principal balance of Certificates
Outstanding and of the current percentage interest of the Residual
Certificates outstanding, and the aggregate principal balance of all cash and
Eligible Investments, held in the Trust Fund;
(e) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than one year after the date of issuance thereof)
having at the time of such investment a rating of not less than "A-1+" ("A-1"
if the maturity is not greater than 30 days and such commercial paper does
not exceed 20% of the then current balance of the certificates) by S&P if S&P
is a Rating Agency, "F-1" by Fitch if Fitch is a Rating Agency, and "P-1" by
Moody's if Xxxxx'x is a Rating Agency;
(f) a Qualified GIC;
(g) certificates or receipts representing direct ownership interests
in future interest or principal payments on obligations of the United States
of America or its agencies or instrumentalities (which obligations are backed
by the full faith and credit of the United States of America) held by a
custodian on behalf of the holders of such receipts;
(h) any other money market deposit, obligation, security or investment
bearing interest or sold at a discount which has an unsecured short-term debt
rating of at least "A-1+" ("A-1" if the maturity is not greater than 30 days
and such investments do not exceed 20% of the then scheduled principal
balance of the Mortgage Loans) if S&P is a Rating Agency, "F-1" if Fitch is a
Rating Agency, and "P-1" if Xxxxx'x is a Rating Agency, or if such investment
relates to a money market fund, such fund must be rated in the highest rating
category by each Rating Agency (which, for S&P, is "AAAm" or "AAAm-G"); and;
(i) any other demand or time deposit, obligation, security or
investment bearing interest or sold at a discount that each Rating Agency
confirms in writing is acceptable;
provided, that each such Eligible Investment is a "permitted investment" as
defined in Internal Revenue Code Section 860G(a)(5).
Section 4.06 Accounting and Directions.
By noon New York time, on the second Business Day preceding each
Distribution Date (or such earlier date as shall be agreed by the Certificate
Administrator and the Trustee), the Certificate Administrator shall provide to
the Trustee, the Paying Agent and the Depositor the following information with
respect to the next Distribution Date (which notification may be given by
facsimile or other electronic transmission (e.g., e-mail), or by telephone
promptly confirmed in writing):
(1) Each Class A Subclass Interest Amount and Class M Subclass Interest
Amount;
(2) The Senior Principal Distribution Amount;
(3) Each Class A Subclass Principal Distribution Amount and each Class M
Subclass Principal Distribution Amount;
(4) The Principal Balance (or notional amount, as applicable) of each
Class and Subclass of Certificates following such payment;
(5) The amount of any Realized Losses for each Pool for the related
Collection Period; and
(6) The amount of 60+ Day Delinquent Loans in each Pool.
Section 4.07 Reports by Certificate Administrator to Holders.
(a) Prior to each Distribution Date, the Servicer shall provide to the
Paying Agent and to the Certificate Administrator (if such party is not also the
Servicer), and on the related Distribution Date the Certificate Administrator
shall forward or make available to each Holder and the Rating Agencies, a report
in writing (which may be a statement prepared by or on behalf of the Servicer)
setting forth:
(i) the amount of the distribution with respect to such Holders'
Certificates (based on a Certificate in the original principal (or
notional) amount of $1,000);
(ii) the amount of such Holder's distributions allocable to
principal (based on a Certificate in the original principal amount of
$1,000);
(iii) the amount of such Holder's distributions allocable to
interest (based on a Certificate in the original principal (or notional)
amount of $1,000);
(iv) each Class A Subclass Interest Shortfall, the Cap Amount,
the Net Civil Relief Amount and the Net Non-Supported Amount for each
Class A Subclass, Class M Subclass Interest Shortfall, Class M Subclass
Cap Amount and the Net Civil Relief Amount and Net Non-Supported Amount
for each Class M Subclass;
(v) the Principal Balance (or notional amount) of each Class and
Subclass (based on a Certificate in the original principal (or notional)
amount of $1,000) which will be Outstanding prior to and after giving
effect to the payment of principal on such Distribution Date;
(vi) the Aggregate Current Pool Balance of, and the number of
Mortgage Loans in, each Pool as of the related Determination Date;
(vii) the aggregate of collections received by the Servicer in
respect of the Mortgage Loans during the related Collection Period and
Prepayment Collection Period;
(viii) the total of any Substitution Adjustment Amounts and any
Loan Repurchase Prices included in such distribution;
(ix) the weighted average Mortgage Note Rate and weighted average
remaining term to maturity of, and cumulative amount of Prepayment
Principal with respect to, the Mortgage Loans in each Pool, each as of
the close of business on the last day of the calendar month preceding
such Distribution Date;
(x) whether a Trigger Event is in effect;
(xi) the Current Class A Enhancement Level;
(xii) the Overcollateralization Amount, any Release Amount, the
amount of Monthly Excess Interest and, if applicable, the Deficiency
Amount (in each case, both before and after giving effect to any Extra
Principal Distribution Amount for such Distribution Date);
(xiii) the amount of any Applied Loss Amount allocated to each
Class and Subclass as of the close of such Distribution Date;
(xiv) for each Class and Subclass, any amount applied in
reduction of the Class M Subclass Loss Amount pursuant to Section 13.02
on such Distribution Date, and each Class M Subclass Loss Amount after
giving effect to such application;
(xv) the aggregate amount of Net Periodic Interest Advances;
(xvi) the amount of Net Servicing Advances;
(xvii) the amount of cumulative Nonrecoverable Advances;
(xviii)for each Class of Floating Rate Certificates, the
Certificate Rate for the related Interest Accrual Period;
(xix) the date of such Distribution Date and the Determination
Date for such Distribution Date;
(xx) for each Class, the applicable Record Date and Interest
Accrual Period;
(xxi) the amount of the Servicing Fee paid to or retained by the
Servicer, and the amount of the Trustee Fee paid to the Trustee, with
respect to such Distribution Date;
(xxii) any expenses or indemnification amounts paid by the Trust
Fund, the specific purpose of each payment and the parties to whom such
payments were made;
(xxiii)any material modifications, extensions or waivers as to
Mortgage Loan terms, fees, penalties or payments since the previous
Distribution Date and cumulatively since the Cut-Off Date;
(xxiv) unless such information is set forth in the Form 10-D
relating to such Distribution Date and provided the Servicer is
reasonably able to include such information on the statement, any
material breaches of representations and warranties relating to the
Mortgage Loans and any material breaches of covenants hereunder; and
(xxv) the number and aggregate principal balance of any Mortgage
Loans repurchased by the Depositor from the Trust Fund since the
previous Distribution Date.
In addition, the Certificate Administrator, on behalf of the Trustee,
shall file with the IRS and furnish to Certificateholders such statements and
information, at such times and in such manner, as shall be required by the Code.
(b) On each Distribution Date, the Certificate Administrator will
forward or make available to each Holder and the Rating Agencies, together
with the information described in subsection (a) above, the following
information for each Pool (calculated as of the close of business on the last
Business Day of the month preceding such Deposit Date) prepared by or on
behalf of the Servicer and furnished for such purpose:
(i) the number and aggregate Unpaid Loan Balances of Mortgage
Loans (a) 30 days Delinquent, (b) 60 days Delinquent and (c) 90 days
Delinquent, (d) the number and aggregate Unpaid Loan Balances of all
Mortgage Loans and (e) the percentage that each of the amounts
represented by clauses (a), (b) and (c) represent as a percentage of the
amount in clause (d);
(ii) the number and Unpaid Loan Balances of all Mortgage Loans in
foreclosure proceedings, separately stating those Mortgage Loans for
which foreclosure proceedings were commenced in the preceding Collection
Period;
(iii) the number and Unpaid Loan Balances of Mortgages involved
in bankruptcy proceedings;
(iv) the Unpaid Loan Balance and book value of any REO Property;
(v) the Cumulative Loss Percentage, Cumulative Realized Losses
and the Realized Losses for the preceding Collection Period; and
(vi) the aggregate Loan Balance of 60+ Day Delinquent Loans (as a
dollar amount and as a percentage of the Aggregate Current Pool
Balance).
The Certificate Administrator, in addition to the distribution of
information under subsections (a) and (b), shall distribute or make available
any Additional Pool Information and any Additional Certificate Information
specified in Article XIV, to the persons and by the dates respectively
specified. The Servicer agrees to provide to the Certificate Administrator such
information on the Mortgage Loans and the Certificates as will enable the
Trustee to perform its obligations under the preceding sentence.
(c) The Certificate Administrator shall fulfill its responsibility to
forward or make available any information or report to Holders under this
Section 4.07 by posting the same on its website, currently located at
xxxxx://xxx.xxxxxxxxxxxxxxx.xxx. If a Holder submits a written request to the
Trustee for a paper copy of the Pooling Agreement, the Trustee shall promptly
inform the Certificate Administrator of such request (including any mailing
address specified by the Holder making such request), whereupon the
Certificate Administrator shall promptly mail to such Holder at such address,
via first class mail, a paper copy of the Pooling Agreement (without
exhibits).
Section 4.08 Other Reports by Certificate Administrator or Paying Agent.
(a) The Certificate Administrator (or the Paying Agent on its behalf)
shall report to the Depositor the amount on deposit in the Certificate Account
and the identity of the investments included therein, as the Depositor may from
time to time reasonably request. The Certificate Administrator shall, at the
reasonable request of the Depositor, transmit promptly copies of all accountings
of receipts in respect of the Mortgage Loans furnished to it by the Servicer or
the Paying Agent, and the Paying Agent shall notify the Depositor if any Monthly
Deposit Amount has not been received by the Paying Agent when due.
The Certificate Administrator and the Paying Agent shall report to each
Holder regarding any written notices it may from time to time receive which
provide a Responsible Officer with actual knowledge that any of the statements
set forth in Section 2.03(a) are inaccurate.
The Paying Agent shall maintain at all times on its website, currently
located at xxxxx://xxx.xx.xxxxxxxxxx.xxx, information concerning the
then-current Certificate Rate of each Class of Certificates. The Paying Agent
shall also provide such information by telephone to each Holder who calls the
Paying Agent at telephone number (000) 000-0000 and requests such information.
Section 4.09 Commission Filings.
(a) The Certificate Administrator will prepare and file all reports
required to be filed by the Depositor under the Exchange Act, including required
periodic reports on Form 10-D and any required current report on Form 8-K, but
excluding reports on Form 10-K, which the Depositor will prepare and file.
(b) Within 15 days after each Distribution Date, the Certificate
Administrator shall file with the Commission through the Commission's
Electronic Data Gathering and Retrieval System ("XXXXX") any Form 10-D
required by the Exchange Act, in form and substance as required by the
Exchange Act. Without limitation of the foregoing, each such Form 10-D shall
include a copy of the reports under Section 4.07 for such Distribution Date
as an exhibit thereto. Any disclosure in addition to the reports under
Section 4.07 that is required to be included on Form 10-D ("Additional Form
10-D Disclosure") shall be reported by the parties set forth on Schedule 2
and directed and approved by the Depositor, and the Certificate Administrator
will have no duty or liability for any failure hereunder to determine or
prepare any Additional Form 10-D Disclosure (other than with respect to
itself) absent such reporting, direction and approval. At least two Business
Days prior to filing any Form 10-D containing any Additional Form 10-D
Disclosure, and upon the Depositor's request prior to filing any other Form
10-D, the Certificate Administrator shall forward electronically a draft copy
of the Form 10-D to the Depositor for review.
For so long as the Trust is subject to the Exchange Act reporting
requirements, within five (5) calendar days after the related Distribution Date,
the parties identified on Schedule 2 shall provide to each of the Certificate
Administrator and the Depositor, in XXXXX-compatible format (e.g., in Word or
Excel format), the form and substance of any Additional Form 10-D Disclosure, if
applicable, and the Depositor will approve, as to form and substance, or
disapprove, as the case may be, the inclusion of the Additional Form 10-D
Disclosure on Form 10-D. The Certificate Administrator has no duty under this
Agreement to monitor or enforce the performance by any other parties listed on
Schedule 2 of their duties under this paragraph or proactively solicit or
procure from such parties any Additional Form 10-D Disclosure (provided that, if
the Certificate Administrator is also the Servicer, this sentence shall not
limit the Servicer's obligations under this Section 4.09(b)). The Certificate
Administrator shall have no liability for any loss, expense, damage or claim
arising out of or with respect to any failure to properly prepare and/or timely
file Additional Form 10-D Disclosure on a Form 10-D, where such failure results
solely from the Certificate Administrator's failure to receive, on a timely
basis, any applicable Additional Form 10-D Disclosure from any other party
specified in Schedule 2 (other than the Servicer, if the Certificate
Administrator is also the Servicer) that is needed to prepare, arrange for
execution or file such Form 10-D, not resulting from the Certificate
Administrator's own negligence, bad faith or willful misconduct.
(c) Prior to January 30 of the year following the year of this
Agreement, the Depositor shall file a Form 15 Suspension Notification for the
Trust Fund, if applicable.
(d) Prior to March 30 of the year following the year of this
Agreement, the Depositor shall file a Form 10-K, in substance conforming to
industry standards, for the Trust Fund.
After preparing the Form 10-K, the Depositor shall forward
electronically a draft copy of the Form 10-K to the Servicer for review. No
later than the close of business on the 10-K Filing Deadline, a senior officer
of the Servicer in charge of the servicing function shall sign the Form 10-K and
return an electronic or fax copy of such signed Form 10-K, together with a
signed copy of the certification (the "Certification") attached hereto as
Exhibit E and required to be included with each Form 10-K pursuant to the
Xxxxxxxx-Xxxxx Act of 2002, as amended (with an original executed hard copy of
each to follow by overnight mail) to the Depositor.
Any disclosure or information in addition to (i) each annual statement
of compliance required under Section 3.14, (ii) each Assessment of Compliance
required under Section 3.15(a), (iii) each Attestation Report required under
Section 3.15(b) and (iv) the Certification that is required to be included on
Form 10-K ("Additional Form 10-K Disclosure") shall, pursuant to the paragraph
immediately below, be reported by the parties set forth on Schedule 3 and
directed and approved by the Depositor.
No later than March 1 of each year that the Trust is subject to the
Exchange Act reporting requirements, commencing in March 2008, the parties
identified on Schedule 3 shall provide to the Depositor, in XXXXX-compatible
format (e.g., in Word or Excel format), the form and substance of any Additional
Form 10-K Disclosure, if applicable. The Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Additional
Form 10-K Disclosure on Form 10-K.
(e) Within four (4) Business Days after the occurrence of an event
requiring disclosure on Form 8-K (each such event, a "Reportable Event"), and
if directed by the Depositor, the Certificate Administrator shall prepare, an
authorized officer of the Certificate Administrator shall sign, and the
Certificate Administrator shall file with the Commission, on behalf of the
Trust, any Form 8-K, as required by the Exchange Act; provided that the
Depositor shall prepare and file the initial Form 8-K in connection with the
issuance of the Certificates. Any disclosure or information related to a
Reportable Event or that is otherwise required to be included on Form 8-K
("Form 8-K Disclosure Information") shall, pursuant to the paragraph
immediately below, be reported by the parties set forth on Schedule 4 and
directed and approved by the Depositor, and the Certificate Administrator
will have no duty or liability for any failure hereunder to determine or
prepare any Form 8-K Disclosure Information (other than with respect to
itself) absent such reporting, direction and approval.
For so long as the Trust is subject to the Exchange Act reporting
requirements, no later than the end of business on the second Business Day after
the occurrence of a Reportable Event the parties identified on Schedule 4 shall
provide to each of the Certificate Administrator and the Depositor, in
XXXXX-compatible form, the form and substance of any Form 8-K Disclosure
Information, if applicable, and the Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Form 8-K
Disclosure Information on Form 8-K. The Certificate Administrator has no duty
under this Agreement to monitor or enforce the performance by the parties listed
on Schedule 4 of their duties under this paragraph or proactively solicit or
procure from such parties any Form 8-K Disclosure Information (provided that, if
the Certificate Administrator is also the Servicer, this sentence shall not
limit the Servicer's obligations under this Section 4.09(e)).
After preparing the Form 8-K, the Certificate Administrator shall
forward electronically a draft copy of the Form 8-K to the Depositor for review.
The Certificate Administrator shall have no liability for any loss, expense,
damage or claim arising out of or with respect to any failure to properly
prepare and/or timely file such Form 8-K, where such failure results solely from
the Certificate Administrator's failure to receive, on a timely basis, any
applicable Form 8-K Disclosure Information from any other party specified in
Schedule 4 (other than the Servicer, if the Certificate Administrator is also
the Servicer) that is needed to prepare, arrange for execution or file such Form
8-K, not resulting from the Certificate Administrator's own negligence, bad
faith or willful misconduct.
(f) The obligations set forth in paragraphs (a), (b), (d) and (e) of
this Section shall apply only with respect to periods for which the Depositor
is obligated to file reports on Form 8-K, 10-D or 10-K with respect to the
Trust. At any time after the filing of a Form 15 Suspension Notification, if
the number of Certificateholders of record exceeds the number set forth in
Section 15(d) of the Exchange Act or the regulations promulgated pursuant
thereto which would cause the Trust to again become subject to the reporting
requirements of the Exchange Act, the Depositor, the Certificate
Administrator and the Servicer, as applicable, shall recommence preparing and
filing reports on Form 10-D and 10-K as required pursuant to this Section and
the parties hereto will again have the obligations set forth in paragraphs
(a), (b), (d) and (e) of this Section.
(g) For so long as the Trust is subject to the Exchange Act reporting
requirements, each of the Depositor, the Certificate Administrator, the
Trustee, the Paying Agent, the Mortgage Note Custodian and the Servicer shall
notify each other of any proceedings of the type described in Item 1117 of
Regulation AB, together with a description thereof, within three Business
Days of (i) the Distribution Date on which such proceeding first becomes a
reportable event and (ii) each subsequent Distribution Date following any
material development in such proceeding. In addition, no later than March 1
of each year during which the Trust is subject to the Exchange Act reporting
requirements, the Depositor, the Certificate Administrator, the Trustee, the
Paying Agent, the Mortgage Note Custodian and the Servicer shall notify each
other of any affiliations or relationships that develop following the Closing
Date between such party and any of parties listed in Item 1119 of Regulation
AB, together with a description thereof.
Section 4.10 Amounts Not Distributed.
Any amount withdrawn for distribution as payment of interest or
principal on any Certificate but which is not distributed because of the
non-presentation of such Certificate, because the check for payment is returned
undelivered or because the Holder thereof has failed to deliver payment
instructions to the Trustee or the Paying Agent, shall be set aside and held by
the Trustee or the Paying Agent in a separate trust account for the benefit of
the Holder. Any such amount shall be deemed to have been duly distributed for
the purpose of all calculations under this Agreement and will not be available
for application to any other amounts payable under this Agreement. If such
amount is an amount representing part of a final distribution pursuant to
Section 9.01, the Trustee and the Paying Agent shall comply with the procedure
set forth in the last paragraph of Section 9.01. After two years from the
original date on which such amount was due and payable to the Holder, any amount
remaining in such separate trust account shall be distributed to the Class R
Certificates, and after such distribution such Holder shall be required to seek
payment as an unsecured general creditor of the Class R Certificateholders.
Section 4.11 Payment of Trust Expenses.
If and only to the extent not otherwise paid under this Agreement, the
Trustee shall make demand on the Depositor to pay the Trust Expenses, and the
Depositor shall promptly pay such expenses directly to the Persons to whom such
amounts are due.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
(a) The Certificates and Residual Certificates shall be substantially in
the forms set forth as Exhibits hereto. The Certificates shall be issued in the
denominations specified in Article XII and shall be executed by manual or
facsimile signature on behalf of CRMSI by its Chairman, President, a Senior Vice
President, Treasurer or one of its Vice Presidents or Assistant Vice Presidents.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures were affixed, authorized to sign on behalf of
CRMSI shall bind CRMSI, notwithstanding that such individuals or any of them
have ceased to be so authorized prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of such Certificates. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form set forth in the following paragraph
executed by the Trustee or, if an Authenticating Agent is appointed pursuant to
Section 8.12, executed by the Authenticating Agent, in each case by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. The Certificates shall be engraved, printed or
lithographed in such manner as to comply with the requirements of The Depository
Trust Company or other Clearing Agency if such Certificates are Book-Entry
Certificates.
The form of authentication referenced in the preceding paragraph is as
follows:
"This is one of the Certificates referred to in the
within-mentioned Agreement.
________________________, as [Trustee][Authenticating
Agent]"
Until such time as Definitive Certificates are issued pursuant to
Section 5.06, each Certificate designated as a Book-Entry Certificate in Article
XII shall be held in book-entry form and shall bear a legend in substantially
the following form:
"Unless this certificate is presented by an authorized
representative of [the Clearing Agency] to the Depositor or its
agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of [Clearing Agency
or nominee] or such other name as requested by an authorized
representative of [Clearing Agency] and any payment is made to
[Clearing Agency or nominee], any transfer, pledge or other use
hereof for value or otherwise by or to any person is wrongful
since the registered owner hereof, [Clearing Agency or nominee],
has an interest herein."
(b) Upon original issuance, the Book-Entry Certificates shall be
issued in the form of one or more typewritten certificates, to be delivered
to the initial Clearing Agency by, or on behalf of, the Depositor. Such
Certificates shall initially be registered on the Certificate Register in the
name of the nominee of the initial Clearing Agency, and no Beneficial Owner
will receive a definitive certificate representing such Beneficial Owner's
interest in the Book-Entry Certificates, except as provided in Section 5.06.
Unless and until definitive, fully registered certificates ("Definitive
Certificates") have been issued to Beneficial Owners pursuant to Section
5.06:
(i) the provisions of this Section 5.01(b) shall be in full force
and effect;
(ii) the Depositor, the Servicer, the Certificate Registrar, the
Paying Agent and the Trustee may deal with the Clearing Agency for all
purposes (including the making of distributions on the Book-Entry
Certificates and the taking of actions by the Holders of Book-Entry
Certificates) as the authorized representative of the Beneficial Owners;
(iii) to the extent that the provisions of this Section 5.01(b)
conflict with any other provisions of this Agreement, the provisions of
this Section 5.01(b) shall control;
(iv) the rights of Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law, the rules, regulations and procedures of the Clearing Agency and
agreements between such Beneficial Owners and the Clearing Agency and/or
the Clearing Agency Participants, and all references in this Agreement
to actions by Certificateholders shall, with respect to the Book-Entry
Certificates, refer to actions taken by the Clearing Agency upon
instructions from the Clearing Agency Participants, and all references
in this Agreement to distributions, notices, reports and statements to
Certificateholders shall, with respect to the Book-Entry Certificates,
refer to distributions, notices, reports and statements to the Clearing
Agency or its nominee, as registered holder of the Book-Entry
Certificates, as the case may be, for the distribution to Beneficial
Owners in accordance with the procedures of the Clearing Agency; and
(v) the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit
distributions of principal and interest on the Certificates to the
Clearing Agency Participants, for distribution by such Clearing Agency
Participants to the Beneficial Owners or their nominees.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing specified voting interests, such direction or consent
shall be given by Beneficial Owners having the requisite percentage interests.
Unless and until Definitive Certificates have been issued to Beneficial
Owners pursuant to Section 5.06, copies of the reports or statements referred to
in Section 4.07 shall be available to Beneficial Owners upon written request to
the Certificate Administrator at xxx.xxxxxxxxxxxxxxx.xxx.
Section 5.02 Registration of Transfer and Exchange of Certificates.
The Depositor shall maintain or cause to be maintained in accordance
with the provisions of Section 6.05 a Certificate Register in which, subject to
such reasonable regulations as it may prescribe, the Depositor shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided.
Upon surrender for registration of transfer of any Certificate at the
office or agency of the Certificate Registrar, the Depositor shall execute and
the Authenticating Agent shall authenticate and deliver, in the name of the
designated transferee or transferee, one or more new Certificates in authorized
denominations of the same aggregate initial Principal Balance or the same
aggregate Percentage Interest, as the case may be.
At the option of the Certificateholder, Certificates may be exchanged
for other Certificates of authorized denominations evidencing the same aggregate
initial Principal Balance or the same aggregate Percentage Interest, as the case
may be, upon surrender of the Certificates to be exchanged at any such office or
agency. Whenever any Certificates are so surrendered for exchange, the Depositor
shall execute and the Authenticating Agent shall authenticate and deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of transfer
or exchange shall be accompanied by a written instrument of transfer in form
satisfactory to the Depositor and the Certificate Registrar duly executed by the
Holder thereof or his attorney duly authorized in writing. Signatures must be
guaranteed by an eligible guarantor institution meeting the requirements of the
Certificate Registrar, which requirements include membership or participation in
the Security Transfer Agent Medallion Program ("STAMP") or such other signature
guarantee program as may be determined by the Certificate Registrar in addition
to, or in substitution for, STAMP, all in accordance with the Securities
Exchange Act of 1934, as amended. Notwithstanding the foregoing, no transfer or
exchange of any Certificate shall be made by the Certificate Registrar or
Authenticating Agent unless the Certificateholder making the exchange has
complied with the provisions of this Agreement, the respective Certificate and
applicable securities laws.
No service charge shall be made for any registration of transfer or
exchange of the Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer and exchange
shall be canceled and, subject to any record retention requirements of the
Exchange Act, subsequently destroyed by the Certificate Registrar.
The Depositor will cause the Certificate Registrar to provide to the
Trustee and the Paying Agent, if the Paying Agent is not the Certificate
Registrar, not later than the third Business Day next preceding each
Distribution Date, the names and addresses of the Certificateholders as of the
Record Date and the aggregate Principal Balance or Percentage Interest held of
record by each of them.
Notwithstanding the foregoing, no legal or beneficial interest in all or
any portion of a Residual Certificate may be transferred, directly or
indirectly, to a "disqualified organization" within the meaning of Code Section
860E(e)(5), or to an agent of a disqualified organization (including a broker,
nominee, or other middleman) (an "Agent") and any such purported transfer shall
be void and of no effect. Further, no legal or beneficial interest in all or any
portion of a Residual Certificate may be registered in the name of a Plan or a
Person investing the assets of a Plan (such Plan or Person an "ERISA Prohibited
Holder") or in the name of a person that is not (i) a U.S. Person (other a U.S.
Person with respect to whom income is attributable to a foreign permanent
establishment or fixed base (within the meaning of an applicable income tax
treaty) of such person or any other U.S. Person) or (ii) a non-U.S. Person that
holds the Residual Certificate in connection with the conduct of a trade or
business within the United States and has furnished the transferor and the
Certificate Registrar with an effective Internal Revenue Service Form W-8ECI or
(iii) a non-U.S. Person that has delivered to the transferor and the Certificate
Registrar an opinion of a nationally recognized tax counsel to the effect that
the transfer of the Residual Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated thereunder and that
such transfer of the Residual Certificate will not be disregarded for federal
income tax purposes (any such person who is not described in clauses (i), (ii)
or (iii) above being referred to herein as a "Non-permitted Foreign Holder").
The Depositor shall not execute and the Authenticating Agent shall not
authenticate and deliver, a new Residual Certificate in connection with any
transfer of a Residual Certificate, and the Depositor and the Certificate
Registrar shall not accept a surrender for transfer or registration of transfer,
or register the transfer of, any Residual Certificate unless the transferor
shall have provided to the Depositor and the Certificate Registrar an affidavit,
substantially in the form marked as Appendix 1 hereto, signed by the transferee,
to the effect that the transferee is not such a disqualified organization, an
agent for any entity as to which the transferee has not received a substantially
similar affidavit, an ERISA Prohibited Holder or a Non-permitted Foreign Holder,
accompanied by a written statement signed by the transferor to the effect that,
as of the time of the transfer, the transferor has no actual knowledge that such
affidavit is false. Upon notice by the Depositor that any legal or beneficial
interest in any portion of a Residual Certificate has been transferred, directly
or indirectly, to a disqualified organization or an Agent in contravention of
the foregoing restrictions, the Trustee shall furnish to the Internal Revenue
Service and the transferor of such Residual Certificate or to such Agent, within
60 days of the request therefor by such transferor or such Agent, and the
Depositor agrees to provide the Trustee with, the computation of such
information necessary to the application of Code Section 860E(e) as may be
required by the Code, including but not limited to the present value of the
total anticipated excess inclusions with respect to such Residual Certificate
(or portion thereof) for periods after such transfer. At the election of the
Depositor, the reasonable cost of computing and furnishing such information may
be charged to the transferor or such Agent; however, the Trustee and the
Depositor shall in no event be excused from furnishing such information. Every
Holder of a Residual Certificate shall be deemed to have consented to such
amendments to the Pooling Agreement as may be required to further effectuate the
restrictions on transfer of Residual Certificates to a disqualified
organization, an Agent, an ERISA Prohibited Holder or a Non-permitted Foreign
Holder.
The affidavit described in the preceding paragraph shall also contain
the statement of the transferee that it (i) has historically paid its debts as
they have come due and intends to do so in the future, (ii) understands that it
may incur liabilities in excess of cash flows generated by the Residual
Certificate, (iii) intends to pay taxes associated with holding the Residual
Certificate as they become due, (iv) will not cause income from the Residual
Certificate to be attributable to a foreign permanent establishment or fixed
base (within the meaning of an applicable income tax treaty) of such transferee
or any other U.S. Person and (v) will not transfer the Residual Certificate to
any person or entity that does not provide a similar affidavit. The transferor's
statement to the Certificate Registrar accompanying the affidavit shall state
that the transferor has no knowledge or reason to know that the statements made
by the transferee with respect to clauses (i) and (iii) of the preceding
sentence are false. Each Residual Certificate shall bear a legend referring to
the restrictions contained in this paragraph and the preceding paragraph.
No transfer of any Private Certificate may be made unless such transfer
is made pursuant to an effective registration statement under the Act and
applicable state securities laws, or an exemption from the Act and applicable
state securities laws is available. Upon surrender for registration of transfer
of any Private Certificate in reliance on such an exemption, (1) the Certificate
Registrar shall not accept surrender for transfer or registration of transfer
of, or register the transfer of, any Private Certificate and (2) the Depositor
shall not execute, and the Authenticating Agent shall not authenticate and
deliver, any new Private Certificate in connection with the transfer of any
Private Certificate, unless the transferee delivers to the Depositor, the
Certificate Registrar a letter substantially to the effect set forth in Exhibit
C to this Agreement and (x) if such transferee is not a "Qualified Institutional
Buyer" within the meaning of Rule 144A of the Act, and if so requested by the
Depositor, in its sole discretion, an opinion of counsel acceptable to the
Depositor shall have been delivered to it, the Certificate Registrar to the
effect that such transfer may be made pursuant to an exemption from the Act; or
(y) if such transfer is to a non-institutional investor, unless such investor is
an accredited investor (as defined in Regulation D under the Act) and has a net
worth (exclusive of primary residence) of at least $1,000,000 as confirmed in
writing to the Certificate Registrar and the Trustee.
No transfer of an ERISA Restricted Certificate may be made unless any
proposed transferee (i) executes a representation letter in substantially the
form of Exhibit D hereto and in substance satisfactory to the Certificate
Registrar, and the Depositor stating that it is not, and is not acting on behalf
of, any employee benefit plan subject to Title I of ERISA or Section 4975 of the
Code, or a governmental plan, as defined in Section 3(32) of ERISA, subject to
any federal, state or local law ("Similar Law") which is, to a material extent,
similar to the foregoing provisions of ERISA or the Code (collectively, a
"Plan") or using the assets of any such Plan to effect such purchase or (ii)
provides (A) an opinion of counsel in form and substance satisfactory to the
Certificate Registrar, the Servicer and the Depositor that the purchase or
holding of such ERISA Restricted Certificate by or on behalf of such Plan will
not constitute or result in a non-exempt prohibited transaction under ERISA or
Section 4975 of the Code or Similar Law and will not subject the Servicer, the
Depositor, the Certificate Registrar or the Trustee to any obligation in
addition to those undertaken in this Agreement and (B) such other opinions of
counsel, officers' certificates and agreements as the Servicer, the Depositor or
the Certificate Registrar may require in connection with such transfer.
For purposes of clause (i) of the preceding paragraph, such
representation shall be deemed to have been made to the Servicer, the Depositor
and the Certificate Registrar by the transferee's acceptance of an ERISA
Restricted Certificate (or the acceptance by a Beneficial Owner of the
beneficial interest in any such Class of ERISA Restricted Certificates) unless
the Servicer, the Depositor and the Certificate Registrar shall have received
from the transferee an alternative representation acceptable in form and
substance to them. Notwithstanding anything else to the contrary herein, any
purported transfer of an ERISA Restricted Certificate to or on behalf of a Plan
without the delivery to the Servicer, the Depositor and the Certificate
Registrar of an Opinion of Counsel satisfactory to them as described above shall
be void and of no effect; provided, however, that the restriction set forth in
this sentence shall not be applicable if there has been delivered to the
Servicer, the Depositor and the Certificate Registrar an Opinion of Counsel
satisfactory to them to the effect that the purchase or holding of an ERISA
Restricted Certificate will not result in a prohibited transaction under ERISA
or the Code and will not subject the Depositor, the Servicer, the Certificate
Registrar or the Trustee to any obligation in addition to those expressly
undertaken in this Agreement. The Servicer, the Certificate Registrar, the
Depositor and the Trustee shall be under no liability to any Person for any
registration of transfer of any ERISA Restricted Certificate that is in fact not
permitted by this Section 5.02 or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Certificate Registrar in accordance with the foregoing
requirements. Each of the Servicer and the Trustee shall be entitled, but not
obligated, to recover from any Holder of any ERISA Restricted Certificate that
was in fact a Plan or a Person acting on behalf of a Plan at the time it became
a Holder or, at such subsequent time as it became a Plan or Person acting on
behalf of a Plan, all payments made on such ERISA Restricted Certificate at and
after either such time. Any such payments so recovered shall be paid and
delivered by the Trustee or a Paying Agent to the last preceding Holder of such
Certificate that is not a Plan or Person acting on behalf of a Plan.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Certificate
Registrar or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate and (b) there is delivered to
the Depositor, the Certificate Registrar and the Trustee such security or
indemnity as may be required by them to save each of them harmless, then, in the
absence of notice to the Certificate Registrar or the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Depositor shall
execute and the Authenticating Agent shall authenticate and deliver, in exchange
for or in lieu of such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and Initial Principal Balance, initial notional amount
or Percentage Interest. In connection with the issuance of any new Certificate
under this Section 5.03, the Certificate Registrar may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Trustee and the Certificate Registrar) connected therewith. Any duplicate
Certificate issued pursuant to this Section 5.03 shall constitute complete and
indefeasible evidence of ownership in the Trust Fund, as if originally issued on
the Issue Date, whether or not the lost, stolen or destroyed Certificate shall
be found at any time.
Section 5.04 Persons Deemed Owners.
Prior to due presentation of a Certificate for registration of transfer,
the Depositor, the Paying Agent, the Trustee, the Certificate Registrar, the
Certificate Administrator and any agent of any of them may treat the Person in
whose name such Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions and for all other purposes whatsoever,
and none of the Depositor, the Paying Agent, the Trustee, the Certificate
Registrar, the Certificate Administrator or any agent of any of them shall be
affected by any notice to the contrary.
Section 5.05 Access to List of Certificateholders' Names and Addresses.
If the Trustee is not the Certificate Registrar and at any time requests
the Depositor or the Certificate Registrar in writing to provide a list of the
names and addresses of Certificateholders, the Depositor will furnish or (if the
Certificate Registrar is not the Depositor) cause the Certificate Registrar to
furnish to the Trustee, within five Business Days after receipt of a request,
such list as of the most recent Record Date, in such form as the Trustee may
reasonably require. If three or more Certificateholders (i) request such
information in writing from the Trustee, (ii) state that such Certificateholders
desire to communicate with other Certificateholders with respect to their rights
under this Agreement or under the Certificates and (iii) provide a copy of the
communication which such Certificateholders propose to transmit, then the
Trustee shall, within five Business Days after the receipt of such request,
afford such Certificateholders access during normal business hours to the most
recent list held by the Trustee. If such list is as of a date more than 90 days
prior to the date of receipt of such Certificateholders' request, the Trustee
shall promptly request from the Depositor or the Certificate Registrar a current
list and shall afford such Certificateholders access to such list promptly upon
its receipt by the Trustee. Every Certificateholder, by receiving and holding a
Certificate, agrees that none of the Depositor, the Certificate Registrar or the
Trustee shall be held accountable by reason of the disclosure of any such
information as to the list of the Certificateholders hereunder, regardless of
the source from which such information was derived.
Section 5.06 Definitive Certificates.
If (A) the Clearing Agency advises the Trustee, the Certificate
Registrar or the Depositor in writing that the Clearing Agency is no longer
willing or able properly to discharge its responsibilities as depository with
respect to the Book-Entry Certificates, and (B) the Depositor is unable to
locate a qualified successor, the Certificate Registrar shall notify the
Beneficial Owners, through the Clearing Agency, of the occurrence of any such
event and of the availability of Definitive Certificates to Beneficial Owners
requesting the same. Upon surrender to the Certificate Registrar by the Clearing
Agency of the Certificates held of record by its nominee, accompanied by
re-registration instructions and directions to authenticate new Certificates
from the Depositor, the Depositor shall execute and the Trustee or the
Authenticating Agent shall authenticate Definitive Certificates for delivery.
The Depositor shall arrange for, and will bear all costs of, the printing and
issuance of such Definitive Certificates. None of the Depositor, the Servicer,
the Certificate Registrar, the Authenticating Agent or the Trustee shall be
liable for any delay in delivery of such instructions by the Clearing Agency and
may conclusively rely on, and shall be protected in relying on, such
instructions.
Section 5.07 Notices to Clearing Agency.
Whenever notice or other communication to the Holders of Book-Entry
Certificates is required under this Agreement, unless and until Definitive
Certificates shall have been issued to Beneficial Owners pursuant to Section
5.06, the Trustee shall have all such notices and communications specified
herein to be given to Holders of Book-Entry Certificates to the Clearing Agency.
ARTICLE VI
CRMSI AND THE SERVICER
Section 6.01 Liability.
CRMSI and the Servicer shall be liable in accordance herewith only to
the extent of the respective obligations specifically undertaken by them herein.
Section 6.02 Merger or Consolidation, or Assumption of Obligations.
Any corporation into which CRMSI may be merged or consolidated, or any
corporation resulting from any merger, conversion or consolidation to which
CRMSI shall be a party, or any corporation succeeding to the business of CRMSI,
or any corporation, more than 50% of the voting stock of which is, directly or
indirectly, owned by Citigroup, which executes an agreement of assumption to
perform every obligation of CRMSI hereunder, shall be the successor of CRMSI
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, that in the event that any such successor corporation
executes such agreement of assumption, CRMSI shall not thereby be released from
any of its obligations or liabilities hereunder.
Any corporation into which the Servicer may be merged or consolidated,
or any corporation resulting from any merger, conversion or consolidation to
which the Servicer shall be a party, or any corporation succeeding to the
business of the Servicer, or any corporation, more than 50% of the voting stock
of which is, directly or indirectly, owned by Citigroup Inc., which executes an
agreement of assumption to perform every obligation of the Servicer hereunder,
shall be the successor of the Servicer hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, that in the event
that any such successor corporation executes such agreement of assumption, the
Servicer shall not thereby be released from any of its obligations or
liabilities hereunder.
Section 6.03 Limitation on Liability.
None of CRMSI, the Servicer or any of their respective directors,
officers, employees and agents shall be under any liability to the Trust Fund or
the Certificateholders for any action taken or for refraining from the taking of
any action pursuant to this Agreement, or for errors in judgment, provided,
however, that none of CRMSI, the Servicer or any such person will be protected
against any liability which would otherwise be imposed by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. CRMSI, the
Servicer and any director or officer or employee or agent of either of them may
rely in good faith on any document of any kind prima facie properly executed and
submitted by any Person respecting any matters arising hereunder. CRMSI, the
Servicer and any of their respective directors, officers, employees or agents
shall be indemnified and held harmless by the Trust Fund against any loss,
liability or expense incurred in connection with any suit in equity, action at
law or other proceedings relating to this Agreement or the Certificates, other
than any loss, liability or expense incurred by reason of willful misfeasance,
bad faith or gross negligence in the performance of duties hereunder or reckless
disregard of obligations and duties hereunder. The Servicer shall withdraw from
the Collection Account, pursuant to Section 3.06(d)(G), any amounts due to
itself or CRMSI pursuant to the preceding sentence, and shall pay such amounts
to itself or to CRMSI, as applicable. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Mortgage Loans in accordance with this
Agreement and which in its respective opinion may involve it in any expense or
liability, provided, however, that the Servicer may in its sole discretion
undertake any such action which it may deem necessary or desirable in respect of
this Agreement and the rights and duties of the parties hereto and the interests
of the Certificateholders hereunder. In such event, the legal expenses and costs
of such action and any liability resulting therefrom shall be expenses, costs
and liabilities of the Trust Fund and the Servicer shall be entitled to be
reimbursed therefor out of the Collection Account. The Servicer may withdraw
from the Collection Account, pursuant to Section 3.06(d)(H), any amounts for
which it is entitled to reimbursement pursuant to the preceding sentence.
Section 6.04 Servicer Not to Resign.
Subject to the provisions of Sections 6.02 and 6.06, the Servicer shall
not resign from the obligations and duties hereby imposed on it without the
consent of the Trustee and the Holders of the Required Amount of Certificates,
except upon a determination that the performance of its duties hereunder is no
longer permissible under applicable law or are in material conflict by reason of
applicable law with any other activities carried on by it, such other activities
being of a type and nature carried on by the Servicer at the date hereof. Any
such determination permitting the resignation of the Servicer shall be evidenced
by an Opinion of Counsel to such effect delivered to the Trustee. No resignation
by the Servicer shall become effective until the Trustee or a successor servicer
shall have assumed the responsibilities and obligations of the Servicer in
accordance with Section 7.01.
Section 6.05 Maintenance of Office or Agency.
CRMSI shall maintain or cause to be maintained at its expense an office
or offices or agency or agencies where the Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
CRMSI in respect of the Certificates and this Agreement may be served. CRMSI
initially appoints the Certificate Registrar designated in Article XII as its
office for purposes of receipt of notices and demands. CRMSI will give prompt
written notice to the Trustee and to the Certificateholders of any change in the
location of the Certificate Registrar or any such office or agency.
Section 6.06 Delegation of Duties.
In addition to arrangements pursuant to Section 3.03, so long as CMI is
the Servicer and/or Certificate Administrator, CMI may at any time without
notice or consent delegate any duties hereunder to any entity, including an
entity more than 50% of the stock of which is owned, directly or indirectly, by
Citigroup; provided that such entity has been approved as a seller/servicer by
Xxxxxx Xxx or FHLMC. Such delegation shall not, however, relieve CMI of its
responsibility with respect to such duties.
ARTICLE VII
SERVICER DEFAULT; RESIGNATION
Section 7.01 Servicing Events of Default.
(a) If any one of the following events ("Servicing Events of Default")
shall occur and be continuing:
(i) Any failure by the Servicer, if the Servicer is the Paying
Agent, to distribute to Certificateholders any payment required under
the terms of this Agreement or, if the Servicer is not the Paying Agent,
to pay over or to cause to be paid over to the Paying Agent for such
distribution, any payment so required or to remit to the Paying Agent
for deposit in the Certificate Account any payment required to be made
under the terms of this Agreement (including any payment required to be
made by the Servicer pursuant to Section 3.08) which failure continues
unremedied for a period of (A) ten Business Days after the date on which
written notice of such failure shall have been given to the Servicer by
or on behalf of the Trustee, or to the Servicer and the Trustee by the
Holders of the Required Amount of Certificates, if the Servicer falls to
distribute or remit the full amount of a required payment as the result
of an error in calculating the amount of such required payment or (B)
three Business Days after written notice of such failure shall have been
given to the Servicer as provided above if the Servicer falls to
distribute or remit the full amount of a required payment for any reason
other than as a result of an error in calculation; or
(ii) Failure on the part of the Servicer duly to observe or
perform in any material respect any of its covenants or agreements set
forth in this Agreement, which failure (A) materially adversely affects
the rights of the Certificateholders and (B) continues unremedied for a
period of 60 Business Days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been given
to the Servicer by or on behalf of the Trustee, or to the Servicer and
the Trustee by the Holders of the Required Amount of Certificates; or
(iii) The entry of a decree or order by a court or agency or
supervisory authority having jurisdiction in the premises for the
appointment of a conservator, receiver or liquidator for the Servicer in
any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings, or for the winding up or liquidation
of its affairs, and the continuance of any such decree or order unstayed
and in effect for a period of 60 consecutive days; or
(iv) The Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshaling of assets and liabilities or similar proceedings of or
relating to the Servicer or of or relating to substantially all of its
property, or the Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take
advantage of any applicable insolvency or reorganization statute, make
an assignment for the benefit of its creditors, or voluntarily suspend
payment of its obligations; or
(v) The occurrence of any other event specified in Section 14.03
as a Servicing Event of Default;
then the Trustee, acting upon the instructions of the Required Amount of
Certificates, may remove the Servicer as such under this Agreement. The Servicer
shall continue to act as servicer under this Agreement for a period commencing
on the date on which such Servicing Event of Default occurred and ending on the
last day of the calendar quarter in which such Servicing Event of Default
occurred, unless prior to the end of such period a successor Servicer shall have
been appointed pursuant to this Section 7.01 or the Trustee shall have notified
the Servicer of the Trustee's election to assume the Servicer's servicing
responsibilities and obligations at an earlier date.
(b) Each party agrees to use its best efforts to inform the Trustee of
any materially adverse information regarding the Servicer's servicing
activities that comes to the attention of such party from time to time.
(c) [Reserved].
(d) No removal or resignation of the Servicer shall become effective
until the Trustee or a successor Servicer shall have assumed the Servicer's
responsibilities and obligations in accordance with this Section.
(e) Upon removal or resignation of the Servicer, the Servicer at its
own expense also shall promptly deliver or cause to be delivered to a
successor servicer or the Trustee all the books and records (including,
without limitation, records kept in electronic form) that the Servicer has
maintained for the Mortgage Loans, including all tax bills, assessment
notices, insurance premium notices and all other documents as well as all
original documents then in the Servicer's possession.
(f) Any collections then being held by the Servicer prior to its
removal or resignation and any collections received by the Servicer
thereafter shall be endorsed by it to the Trustee and remitted directly and
immediately to the Trustee or the successor Servicer.
(g) Upon removal or resignation of the Servicer, the Trustee may (A)
solicit bids for a successor servicer as described below or (B) assume the
servicing responsibilities and obligations hereunder as Servicer. If the
Trustee elects to solicit bids for a successor Servicer, the Trustee agrees
to act as Servicer during the solicitation process and shall assume all
duties of the Servicer (except as otherwise provided in this Agreement). The
Trustee shall, if it is unable to obtain a qualifying bid and is prevented by
law from acting as Servicer, appoint, or petition a court of competent
jurisdiction to appoint, any housing and home finance institution, bank or
mortgage servicing institution which has been designated as an approved
seller-servicer by Xxxxxx Mae or FHLMC for first and second mortgage loans
and having equity of not less than $5,000,000, as determined in accordance
with generally accepted accounting principles, as the successor to the
Servicer in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder. The compensation of any successor
Servicer (other than the Trustee as successor Servicer) so appointed shall be
the amount agreed to between the successor Servicer and the Trustee (up to a
maximum equal to the Servicing Fee) together with the other servicing
compensation provided in Section 3.13; provided, that if the Trustee becomes
the successor Servicer it shall receive as its compensation the same
compensation paid to the Servicer immediately prior to the Servicer's removal
or resignation.
(h) In the event the Trustee elects to solicit bids as provided above,
the Trustee shall solicit, by public announcement, bids from housing and home
finance institutions, banks and mortgage servicing institutions meeting the
qualifications set forth above. Such public announcement shall specify that
the successor Servicer shall be entitled to servicing compensation in
accordance with subsection (g) above. Within thirty days after any such
public announcement, the Trustee shall negotiate and effect the transfer and
assignment of the servicing rights and responsibilities hereunder to the
qualified party submitting the highest satisfactory bid as to the price it
will pay to obtain servicing. The Trustee shall deduct from any sum received
from the successor Servicer in respect of such sale, transfer and assignment
all costs and expenses of any public announcement and of any sale, transfer
and assignment of the servicing rights and responsibilities hereunder. After
such deductions, the remainder of such sum less any amounts due the Trustee
or the Trust from the Servicer shall be paid by the Trustee to the Servicer
at the time of such sale, transfer and assignment to the Servicer's
successor.
(i) The Trustee and such successor Servicer shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession, including the notification to all Mortgagors and each Rating
Agency of the transfer of servicing. The Servicer agrees to cooperate with
the Trustee and any successor Servicer in effecting the termination of the
Servicer's servicing responsibilities and rights and shall promptly provide
the Trustee or such successor Servicer, as applicable, all documents and
records reasonably requested by it to enable it to assume the Servicer's
functions and shall promptly transfer to the Trustee or such successor
Servicer, as applicable, all amounts which then have been or should have been
deposited in the Collection Account by the Servicer or which are thereafter
received with respect to the Mortgage Loans. Neither the Trustee nor any
other successor Servicer shall be held liable by reason of any failure to
make, or any delay in making, any distribution hereunder or any portion
thereof caused by (i) the failure of the Servicer to deliver, or any delay in
delivering, cash, documents or records to it, or (ii) restrictions imposed by
any regulatory authority having jurisdiction over the Servicer. If the
Servicer resigns or is removed, the Servicer agrees to reimburse the Trust,
the Trustee and the Holders for the costs and expenses associated with the
transfer of servicing to the successor Servicer.
(j) The Trustee or other successor Servicer, upon assuming the duties
of Servicer, shall (i) unless each Rating Agency has confirmed that
recordation is not required, record all assignments of Mortgage Loans not
previously recorded in the name of the Trustee and (ii) make all Periodic
Interest Advances and Compensating Interest payments and deposit them to the
Collection Account which the Servicer has theretofore failed to remit with
respect to the Mortgage Loans; provided, however, that the Trustee or such
successor Servicer shall be required to make Periodic Interest Advances
(including Periodic Interest Advances described in this subsection (j)) only
if, in its good faith judgment, such Periodic Interest Advances will
ultimately be recoverable from the Mortgage Loans.
(k) The Trustee shall give notice to the Holders, the Depositor and
each Rating Agency of the occurrence of any event described in subsection (a)
above of which the Trustee has knowledge.
ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of the Trustee.
The Trustee, prior to the occurrence of a Servicing Event of Default and
after the curing of all Servicing Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If a Servicing Event of Default has occurred (which has
not been cured), the Trustee shall exercise such of the rights and powers vested
in it by this Agreement, and use the same degree of care and skill in their
exercise, as a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to it which
are specifically required to be furnished pursuant to any provision of this
Agreement, shall examine them to determine whether they conform to the
requirements of this Agreement. The Trustee shall not be responsible for the
accuracy or content of any such instrument furnished by the Servicer or the
Depositor. If any such instrument is found not to confirm in any material
respect to the requirements of this Agreement, the Trustee shall request a
satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own misconduct; provided, however, that:
(a) Prior to the occurrence of a Servicing Event of Default, and after
the curing of all Servicing Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, the Trustee shall not be liable except
for the performance of such duties and obligations as are specifically set
forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee and, in the absence of bad faith on
the part of the Trustee, the Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein, upon
any certificates, statements or opinions furnished to the Trustee and
conforming to the requirements of this Agreement;
(b) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer of the Trustee, unless
it shall be proved that the Trustee was negligent in ascertaining the
pertinent facts;
(c) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the Holders of the Required Amount of
Certificates relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred upon the Trustee, under this Agreement;
(d) The Trustee shall not be charged with knowledge of any default
(other than a default in payment to the Trustee) or a Servicing Event of
Default unless a Responsible Officer of the Trustee obtains actual knowledge
of such failure or the Trustee receives written notice of such failure at its
Corporate Trust Office from the Depositor, the Servicer or the Holders of the
Required Amount of Certificates;
(e) The Trustee shall not be required to expend or risk its own funds
or otherwise incur financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if there
is reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it, and nothing in this Agreement shall in any event require the Trustee
to perform, or be responsible for the manner of performance of, any of the
obligations of the Servicer under this Agreement, except during such time, if
any, as the Trustee shall be the successor to, and be vested with the rights,
duties, powers and privileges of, the Servicer in accordance with the terms
of this Agreement; and
(f) Except as specifically required by this Agreement, and without
limiting the generality of this Section 8.01, the Trustee shall have no duty
to see to (A) any recording, filing, or depositing of this Agreement or any
agreement referred to herein or any financing statement or continuation
statement, or to see to the maintenance of any thereof or to any refiling,
rerecording or redepositing of any thereof, (B) any insurance, or (C) the
payment or discharge of any tax, assessment or other governmental charge or
any lien or encumbrance owing with respect to, assessed or levied against,
any part of the Trust Fund other than from funds available in the Certificate
Account.
Section 8.02 Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(a) The Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instruments,
opinion, report, notice, request, consent, order, appraisal, bond or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) The Trustee may consult with counsel and any written advice or
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with such written advice or Opinion of Counsel;
(c) Whenever in the administration of this Agreement the Trustee or
its agent shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, including any
action by the Trustee pursuant to Section 10.01, the Trustee or its agent
(unless other evidence be herein specifically prescribed) may request and, in
the absence of bad faith on its part, rely upon any Officer's Certificate;
(d) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation hereunder or in relation hereto, at the request, order
or direction of any of the Certificateholders, pursuant to the provisions of
this Agreement, unless such Certificateholders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby; nothing herein shall,
however, relieve the Trustee of the obligations, upon the occurrence of a
Servicing Event of Default (which has not been cured), to exercise such of
the rights and powers vested in it by this Agreement, and to use the same
degree of care and skill in their exercise as a prudent man would exercise or
use under the circumstances in the conduct of his own affairs;
(e) The Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized
or within the discretion or rights or powers conferred upon it by this
Agreement;
(f) Prior to the occurrence of a Servicing Event of Default and after
the curing of all Servicing Events of Default which may have occurred, the
Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or other
paper or document, unless requested in writing so to do by the Holders of the
Required Amount of Certificates; provided, however, that if the payment
within a reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in the
opinion of the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Agreement, the Trustee may require
reasonable security or indemnity from such Holders against such cost, expense
or liability as a condition to such investigation. Nothing in this subsection
(f) shall derogate the obligation of the Servicer to observe any applicable
law prohibiting disclosure of information regarding the Mortgagors;
(g) The Trustee may appoint agents (which may include the Depositor
and its Affiliates) to perform any of the responsibilities of the Trustee,
which agents shall have any or all of the rights, powers, duties and
obligations of the Trustee conferred on them by such appointment, provided
that the Trustee shall continue to be responsible for its duties and
obligations under this Agreement, but the Trustee will not be responsible for
any negligence or misconduct on the part of any agent appointed by the
Trustee with due care. For the avoidance of doubt, the Trustee is expressly
authorized and directed to approve the designation of each Mortgage Note
Custodian, Paying Agent, Certificate Registrar and Authenticating Agent
specified in Article XII, and such designated functions shall be the
responsibility of such specified party, and the Trustee shall not be
responsible therefore, notwithstanding the proviso in the preceding sentence.
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
certificate of authentication on the Certificates) shall be taken as the
statements of CRMSI and the Trustee assumes no responsibility for the
correctness of the same. The Trustee makes no representations as to the validity
or sufficiency of this Agreement, the Mortgage Note Custodial Agreement or of
the Certificates (other than the certificate of authentication on the
Certificates) or of any Mortgage Loan or related document. The Trustee shall not
be accountable for the use or application by CRMSI of any of the Certificates or
of the proceeds of such Certificates or for the use or application of any funds
paid to the Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Collection Account or Escrow Account. The Trustee shall have
no liability for any losses incurred as a result of (i) any failure of the Trust
Fund to qualify as the specified separate Constituent REMICs, (ii) any
termination, inadvertent or otherwise, of the status of the Trust Fund as the
specified separate Constituent REMICs, (iii) any tax on prohibited transactions
imposed by Code Section 860F(a)(1), (iv) any tax on net income from foreclosure
property imposed by Code Section 860G(c), (v) any tax on contributions to any
Constituent REMIC after the Startup Day imposed by Code Section 860G(d) or (vi)
any erroneous calculation or determination or any act or omission of the
Servicer hereunder; provided, that the Trustee shall not be excused hereby from
liability for its own negligence, bad faith or failure to perform its duties as
specified herein.
Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the owner
or pledgee of one or more of the Certificates with the same rights as it would
have if it were not Trustee and may otherwise deal with the Depositor and its
Affiliates as if it were not the Trustee.
Section 8.05 Fees and Expenses Paid by Servicer.
The Trustee's fees and expenses (and those of any co-trustee appointed
pursuant to Section 8.10, any Certificate Registrar, any Mortgage Note
Custodian, Depository, Paying Agent, any Authenticating Agent appointed pursuant
to Section 8.12 and any agent of the Trustee appointed pursuant to Section
8.02(g)) shall be paid by the Servicer. The Trustee (and any co-trustee) shall
be entitled to reasonable compensation (which shall not be limited by any
provision of law regarding the compensation of a trustee of an express trust)
for all services rendered by it in execution of the trusts hereby created and in
the exercise and performance of the Trustee's powers and duties hereunder, and
upon notice to the Servicer, the Trustee, the Paying Agent, the Certificate
Registrar and the Authenticating Agent will be reimbursed for all reasonable
expenses and disbursements incurred by the Trustee, the Paying Agent, the
Certificate Registrar or the Authenticating Agent, as the case may be, in
accordance with the provisions of this Agreement (including the reasonable
compensation, disbursements and expenses of its counsel and all persons not
regularly in its employ), except any such expense or disbursement as may arise
from its negligence or bad faith or which is covered by any undertaking by
Certificateholders pursuant to 8.02(d) or (f) or, if applicable, Section
8.01(e); provided that, if the Servicer has previously entered into a separate
agreement with any of the Trustee, the Paying Agent, the Certificate Registrar,
the Authenticating Agent or the Mortgage Note Custodian concerning payment of
expenses of such Person in connection with this Agreement, any payment by the
Servicer to such Person of expenses referenced in this sentence or the
immediately preceding sentence shall be made to the extent required under such
separate agreement. To the extent of amounts available for withdrawal from the
Collection Account in accordance with the immediately succeeding sentence, the
Servicer shall indemnify and hold harmless the Trustee, the Certificate
Administrator, the Paying Agent, the Certificate Registrar, the Authenticating
Agent, the Mortgage Note Custodian (in each case, including in such Person's
capacity as a Depository, if any) and each director, officer or employee of any
of them from and against any loss, liability or expense incurred or paid to
third parties (other than salaries paid to employees, and allocable overhead) in
connection with its acceptance and administration of its trusts hereunder or
under the Certificates, except any such expense, loss or liability as may arise
from its negligence, bad faith or willful misconduct or which is covered by any
indemnity provided by the Certificateholders pursuant to Section 8.02(d) or (f)
or, if applicable, Section 8.01(e). The Servicer shall withdraw from the
Collection Account, pursuant to Section 3.06(d)(I), any amounts due the Trustee,
the Certificate Administrator, the Paying Agent, the Certificate Registrar, the
Authenticating Agent, the Mortgage Note Custodian or any director, officer or
employee of any of them pursuant to the preceding sentence, and shall pay such
amounts to such Persons entitled thereto. The provisions of this Section 8.05
shall survive the termination of this Agreement and the resignation or removal
of CMI as Servicer (if such action which caused the need for indemnification
occurred while CMI acted as servicer) and the resignation or removal of the
Certificate Administrator, the Certificate Registrar, the Paying Agent, the
Authenticating Agent, the Mortgage Note Custodian, any Depository and the
Trustee, as the case may be.
Section 8.06 Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or a national
banking association, other than an Affiliate of the Depositor, organized and
doing business under the laws of the United States of America or any State
thereof, authorized under such laws to exercise corporate trust powers, having
its Corporate Trust Office in the State of New York or the Commonwealth of
Massachusetts, having a combined capital and surplus of at least $30,000,000 and
subject to supervision or examination by federal or state authority and having a
short-term debt rating of at least (a) "A-2" from S&P if S&P is a Rating Agency
and Moody's if Xxxxx'x is a Rating Agency (or a long-term debt rating of "BBB+"
(or "Baa1" in the case of Moody's) if it has no short-term debt rating) and (b)
"F-1" from Fitch if Fitch is a Rating Agency (or a long-term debt rating of "A"
if it has no short-term debt rating). If such corporation or national banking
association publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section 8.06, the combined capital and surplus of such
corporation or national banking association shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 8.06, the Trustee shall resign
immediately in the manner and with the effect specified in Section 8.07.
Section 8.07 Resignation or Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor. Upon receiving
such notice of resignation, the Depositor shall promptly appoint a successor
Trustee by written instrument, in duplicate, one copy of which instrument shall
be delivered to the resigning Trustee and one copy to the successor Trustee. If
no successor Trustee shall have been so appointed and having accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance with
Section 8.06 and shall fail to resign after written request therefor by the
Depositor, or if at any time the Trustee shall be legally unable to act, or
shall be adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conversion or liquidation, then the Depositor may remove the
Trustee. If the Depositor removes the Trustee under the authority of the
preceding sentence, the Depositor shall promptly appoint a successor Trustee by
written instrument, in duplicate, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor Trustee.
The Trustee may also be removed at any time (i) by the Depositor, (a) if
the Trustee ceases to be eligible to continue as such under this Agreement or if
the Trustee becomes insolvent, (b) if the Trustee breaches any of its duties
under this Agreement, which breach materially adversely affects the
Certificateholders, (c) if through the performance or nonperformance of certain
actions by the Trustee, any rating assigned to the Certificates would be
reduced, qualified or withdrawn or (d) if the credit rating of the Trustee is
downgraded to a level which would result in any rating assigned to the
Certificates to be reduced, qualified or withdrawn; or (ii) by the Holders of
Certificates evidencing more than 50% of the Voting Interest of the Certificates
then Outstanding, more than 50% of the Percentage Interests of the Class CE
Certificates then Outstanding and more than 50% of the Percentage Interests of
the Residual Certificates then Outstanding.
Any resignation or removal of the Trustee and appointment of a successor
Trustee pursuant to any of the provisions of this Section 8.07 shall not become
effective until acceptance of appointment by the successor Trustee as provided
in Section 8.08.
Section 8.08 Successor Trustee.
Any successor Trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor and to its predecessor Trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor Trustee shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder with like effect as if originally named as Trustee. The
predecessor Trustee shall deliver to the successor Trustee all Mortgage Files
and related documents and statements held by it hereunder; and the predecessor
Trustee shall amend the Mortgage Note Custodial Agreement to make the successor
Trustee the successor to the predecessor Trustee thereunder; and the Depositor
and the predecessor Trustee shall execute and deliver such instruments and do
other such things as may reasonably be required for fully and certainly vesting
and confirming in the successor Trustee all such rights, powers, duties and
obligations. All costs associated with the appointment of a successor Trustee
shall be paid to the Person that incurred them by the predecessor Trustee.
Without limiting the predecessor Trustee's obligation, if the predecessor
Trustee fails to pay such costs, such costs shall be reimbursed by the Trust;
provided, however, that if the predecessor Trustee has been terminated pursuant
to the third paragraph of Section 8.07, all reasonable expenses incurred in
complying with this Section 8.08 shall be reimbursed by the Trust to the Person
that incurred them.
No successor Trustee shall accept appointment as provided in this
Section 8.08 unless (x) at the time of such acceptance such successor Trustee
shall be eligible under Section 8.06 and (y) each Rating Agency shall have
provided written acknowledgement to the Depositor that the ratings of the
Certificates in effect immediately prior to the appointment of such successor
Trustee would not be qualified, downgraded or withdrawn and the Certificates
would not be placed on credit review status (except for possible upgrading) as a
result of such appointment.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
Trustee hereunder all Holders of Certificates at their addresses as shown in the
Certificate Register and to the Rating Agencies. If the Depositor fails to mail
such notice within 10 days after acceptance of appointment by the successor
Trustee, the successor Trustee shall cause such notice to be mailed at the
expense of the Depositor.
The predecessor Trustee and successor Trustee shall notify the Depositor
and the Servicer of any such appointment at least two Business Days prior to the
effective date thereof and shall provide the Servicer with all information
required by the Servicer to comply with the reporting obligation under Item 6.02
of Form 8-K with respect to the Trust not later than the effective date of such
appointment.
Section 8.09 Merger or Consolidation of Trustee.
Any corporation or national banking association into which the Trustee
may be merged or converted or with which it may be consolidated, or any
corporation or national banking association resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation or national banking association succeeding to all or substantially
all of the corporate trust business of the Trustee, shall be the successor of
the Trustee hereunder, provided such corporation or national banking association
shall be eligible under Section 8.06, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding; provided, however, that the Trustee and
such surviving Person shall notify the Depositor and the Servicer of any such
merger, conversion or consolidation and shall provide the Servicer with all
information required by the Servicer to comply with the reporting obligation
under Item 6.02 of Form 8-K with respect to the Trust not later than the
effective date of such merger, conversion or consolidation.
Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for
the purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust Fund or property securing any Mortgage Note may at the time be
located, the Depositor and the Trustee acting jointly shall have the power and
shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust Fund, and to vest in such Person or Persons, in such capacity and for the
benefit of the Certificateholders, such title to the Trust Fund, or any part
thereof, and, subject to the other provisions of this Section 8.10, such powers,
duties, obligations, rights and trusts as the Depositor and the Trustee may
consider necessary and desirable. If the Depositor shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
the case a Servicing Event of Default shall have occurred and be continuing, the
Trustee alone shall have the power to make such appointment. No co-trustee or
separate trustee hereunder shall be required to meet the terms of eligibility as
a successor trustee under Section 8.06 and no notice to the Certificateholders
of the appointment of any co-trustee or separate trustee shall be required under
Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted by
law and by the instrument appointing such separate trustee or co-trustee, be
appointed and act subject to the following provisions and conditions:
(a) All rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee or co-trustee jointly (it
being understood that such separate trustee or co-trustee is not authorized
to act separately without the Trustee joining such act), except to the extent
that under any law of any jurisdiction in which any particular act or acts
are to be performed (whether as Trustee or as successor to the Servicer
hereunder), the Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Fund or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, but solely at the direction of the Trustee;
(b) No trustee hereunder shall be held personally liable by reason of
any act or omission of any other trustee hereunder; and
(c) The Depositor and the Trustee acting jointly may at any time
accept the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all of the provisions of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee and a
copy thereof given to the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee to the extent permitted by law, without the appointment of a new or
successor trustee.
Section 8.11 Tax Returns.
(a) The Trustee, the Servicer, the Certificate Administrator, the
Certificate Registrar and the Paying Agent shall, upon request, furnish the
Depositor with all such information as may be reasonably required so that the
Depositor may prepare and file or cause to be prepared and filed with the
Internal Revenue Service and applicable state or local tax authorities income
tax or information returns for each taxable year for each Constituent REMIC and
for any portion of the Trust Fund that is treated as a grantor trust, containing
such information and at the times and in the manner as may be required by the
Code or state or local tax laws, regulations or rules, and shall furnish or
cause to be furnished to Certificateholders, the schedules, statements or
information at such times and in such manner as may be required thereby. Within
30 days of the Closing Date, the Certificate Administrator will furnish to the
Internal Revenue Service, on Form 8811 or as otherwise required by the Internal
Revenue Code, the name, title, address, and telephone number of the person that
the Certificateholders may contact for tax information relating to the REMICs,
together with any additional information required by Form 8811, and will update
such information as required by the Internal Revenue Code. Such federal, state
or local income tax or information returns, at the written request of the
Depositor, be signed by the Trustee or such other person as may be required to
sign such returns by the Code or state or local tax laws, regulations or rules,
provided that the Depositor, and not the Trustee, shall be responsible for the
contents and filing of such returns.
(b) In the first federal income tax return of each of the Constituent
REMICs for its short taxable year ending December 31 in the year in which the
Startup Day occurs, REMIC status shall be elected for such taxable year and
all succeeding taxable years.
(c) The Certificate Administrator on behalf of the Trustee will
maintain such records relating to each of the Constituent REMICs, including
but not limited to the income, expenses, assets and liabilities thereof, and
the adjusted basis of the property thereof determined at such intervals as
may be required by the Code, as may be necessary to prepare the foregoing
returns, schedules, statements or information.
(d) If in any taxable year there will be more than one holder of any
class of residual certificates, a tax matters person may be designated for
the related REMIC, as more specifically provided for in Section 12.06.
(e) Each Holder of a Residual Certificate shall be deemed to have
agreed, by acceptance thereof, to be bound by this Section 8.11, by Section
5.02 and by the "REMIC-Related Provisions" set forth in Section 12.04.
Section 8.12 Appointment of Authenticating Agent.
On the date of this Agreement, on the Issue Date or at any time when any
of the Certificates remain outstanding the Trustee may appoint an Authenticating
Agent or Agents (which may include CRMSI or any of its Affiliates) which shall
be authorized to act on behalf of the Trustee to authenticate Certificates, and
Certificates so authenticated shall be entitled to the benefit of this Agreement
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Agreement to the
authentication and delivery of Certificates by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Depositor and shall at all times be a corporation or national banking
association organized and doing business under the laws of the United States of
America, any state thereof or the District of Columbia, authorized under such
laws to act as Authenticating Agent, having a combined capital and surplus of
not less than $15,000,000, authorized under such laws to conduct a trust
business and subject to supervision or examination by federal or state
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section 8.12, the combined
capital and surplus of such Authenticating Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time an Authenticating Agent shall cease to be eligible
in accordance with the provisions of this Section 8.12, such Authenticating
Agent shall resign immediately in the manner and with the effect specified in
this Section 8.12.
Any corporation or national banking association into which an
Authenticating Agent may be merged in or converted or with which it may be
consolidated, or any corporation or national banking association resulting from
any merger, conversion or consolidation to which such Authenticating Agent shall
be a party, or any corporation or national banking association succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation or national
banking association shall be otherwise eligible under this Section 8.12, without
the execution or filing of any paper or any further act on the part of the
Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Depositor. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Depositor. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with this Section
8.12, the Trustee may appoint a successor acceptable to the Depositor and shall
mail written notice of such appointment by first-class mail, postage prepaid to
all Certificateholders as their names and addresses appear in the Certificate
Register. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 8.12.
Any reasonable compensation paid to an Authenticating Agent for its
services under this Section 8.12 shall be a reimbursable expense pursuant to
Section 8.05 if paid by the Trustee.
If an appointment is made pursuant to this Section 8.12, the
Certificates may have endorsed thereon, in addition to the Trustee's certificate
of authentication, an alternate certificate of authentication in the following
form:
"This is one of the Certificates referred to in the
within-mentioned Agreement.
___________________________________
As Trustee
By:________________________________
Authenticating Agent
By:________________________________
Authenticating Signature"
Section 8.13 Appointment of Custodians.
The Trustee may at any time on or after the Closing Date, with the
consent of the Depositor and the Servicer, appoint one or more Mortgage Note
Custodians, as the case may be, to hold all or a portion of the applicable
Mortgage Files as agent for the Trustee, by entering into a custodial agreement
in a form acceptable to the Depositor and the Servicer. Subject to this Article
VII, the Trustee agrees to comply with the terms of each custodial agreement and
to enforce the terms and provisions thereof against the Mortgage Note Custodian
for the benefit of the Certificateholders. Each Mortgage Note Custodian shall be
a depository institution subject to supervision by federal or state authority,
shall have a combined capital and surplus of at least $10,000,000 and shall be
qualified to do business in the jurisdiction in which it holds any Mortgage
File.
Notwithstanding the foregoing, to the extent the Trustee appoints one or
more Mortgage Note Custodians with respect to more than 5% of the aggregate Pool
Balance, the Trustee shall cause such Mortgage Note Custodian to prepare a
separate Assessment of Compliance and Attestation Report, as contemplated by
Sections 3.15(a) and 3.15(b) of this Agreement and deliver such reports in
accordance with such Sections 3.15(a) and 3.15(b).
ARTICLE IX
TERMINATION
Section 9.01 Termination upon Purchase by Servicer of Mortgage Loans.
(a) The respective obligations and responsibilities of the Depositor,
the Servicer and the Trustee created hereby and the Trust Fund created hereby
shall terminate upon the earlier of (x) the purchase on a Distribution Date by
the Servicer of all of the Mortgage Loans and all property acquired in respect
of any Mortgage Loan remaining in the Trust Fund at a price equal to the sum of
(i) 100% of the Unpaid Loan Balance of each Mortgage Loan as of the related
Determination Date, together with accrued interest thereon to (but not
including) such Distribution Date at the related Pass-Through Rate, to the
extent not previously advanced by the Servicer, net of unreimbursed Servicing
Advances and Periodic Interest Advances, and (ii) the appraised value of any REO
Property in the Trust Fund (less the good faith estimate of the Depositor of
liquidation expenses to be incurred in connection with its disposal thereof),
such appraisal to be conducted by an appraiser mutually agreed upon by the
Depositor and the Trustee and (y) the later of (i) the maturity or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and the disposition of all property acquired upon
foreclosure or by deed in lieu of foreclosure of any Mortgage Loan and (ii) the
payment to the Certificateholders of all amounts required to be paid to them
pursuant to this Agreement; provided, however, that in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the lawful descendants of Xxxxxx X. Xxxxxxx, the late
Ambassador of the United States of America to the Court of St. James's, living
on the date of this Agreement. Such termination shall occur only in connection
with a "qualified liquidation" of each Constituent REMIC within the meaning of
Code Section 860F(a)(4)(A), pursuant to which the Trustee shall sell or
otherwise dispose of all of the remaining assets of the Trust Fund and make all
required distributions to Certificateholders within 90 days of the adoption of a
plan of complete liquidation. For this purpose, the notice of termination
described in the next paragraph shall be the adoption of a plan of complete
liquidation described in Code Section 860F(a)(4)(A)(i), which shall be deemed to
occur on the date the first such notice is mailed. Such date shall be specified
in the final federal income tax return of each Constituent REMIC constituting
the Trust Fund.
(b) The right of the Servicer to purchase all of the Mortgage Loans on
any Distribution Date pursuant to clause (a)(x) above shall be conditioned upon
(A) the Aggregate Current Pool Balance, at the time of such repurchase and after
giving effect to distributions and allocations of losses to be made on such
Distribution Date, being less than 10% of the Aggregate Initial Pool Balance and
(B) any other condition set forth in Article XII. The right of the Servicer to
purchase all of the Mortgage Loans on any Distribution Date pursuant to clause
(a)(x) above shall be further conditioned upon the purchase price specified in
clause (a)(x) above being less than or equal to the aggregate fair market value
of the Mortgage Loans (other than any REO Mortgage Loans) and the Mortgaged
Properties related to the REO Mortgage Loans; provided, however, that this
sentence shall not apply to any purchase by the Servicer if, at the time of the
purchase, no relevant party is subject to regulation by the Office of the
Comptroller of the Currency, the FDIC, the Federal Reserve or the Office of
Thrift Supervision (provided, that a determination that no party subject to such
regulation is a "relevant party" for the purposes of this sentence shall require
the agreement of the Depositor and, if CMI is the Servicer, the Servicer). Fair
market value for purposes of this paragraph and the preceding paragraph will be
determined by the Servicer as of the close of business on the third Business Day
next preceding the date upon which notice of any termination is furnished to
Certificateholders pursuant to Section 9.01(d). The payment made by the Servicer
under clause (a)(x) above shall be in addition to (but not in duplication of any
part of) the distribution that would otherwise be made on the Certificates on
such Distribution Date. The Servicer shall have the right, in its sole
discretion, to transfer its right to repurchase the Mortgage Loans to any third
party of its choice.
(c) Any other method of termination of the Trust or repurchase of
Mortgage Loans than as set forth above must be based on the receipt by the
Trustee of an Opinion of Counsel or other evidence that such termination or
repurchase will be part of a "qualified liquidation" within the meaning of Code
Section 860F(a)(4)(A), will not adversely affect the status of the Trust Fund as
the separate Constituent REMICs under the Code and will not otherwise subject
the Trust Fund to any tax.
(d) Notice of any termination, specifying the Distribution Date upon
which the Certificateholders may surrender their Certificates to the Paying
Agent for payment of the final distribution and cancellation, shall be given
promptly by the Paying Agent by letter to Certificateholders mailed not later
than 30 days nor more than 60 days prior to such Distribution Date specifying
(A) the Distribution Date upon which final payment of the Certificates will be
made upon presentation and surrender of Certificates at the office therein
designated, (B) the amount of such final payment and (C) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments being
made only upon presentation and surrender of the Certificates at the office of
the Paying Agent therein specified. The Depositor shall provide such notice to
the Trustee prior to the time at which such notice is required to be given to
Certificateholders and, if applicable, to the Certificate Registrar, the
Servicer, the Mortgage Note Custodian and the Paying Agent at the time such
notice is given to Certificateholders. In the event such notice is given, the
Depositor shall deposit in the Certificate Account or the account designated by
the Paying Agent if the Depositor is not the Paying Agent, on the Business Day
preceding the Distribution Date for such final distribution, an amount equal to
the final payment in respect of the Certificates. Upon certification to the
Trustee by an Authorized Officer of the Depositor to the effect that all
conditions set forth in this Article IX have been met, the Trustee shall
promptly direct the Mortgage Note Custodian and the Servicer to release the
Mortgage Files to the Depositor or its designee.
In the event that all Certificateholders shall not surrender their
Certificates for cancellation within six months after the date specified in the
above-mentioned notice, the Paying Agent shall give a second written notice to
the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice all such Certificates shall not have been
surrendered for cancellation, the Paying Agent may take appropriate steps, or
may appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds deposited by the Depositor for such final
payment which remain subject hereto. Interest shall not accrue for the period of
any delay in the payment of a Certificate resulting from the failure of a Holder
to surrender such Certificate in accordance herewith.
ARTICLE X
GENERAL PROVISIONS
Section 10.01 Amendment.
This Agreement may be amended from time to time by the Depositor, the
Servicer, the Certificate Administrator, the Trustee, the Paying Agent, the
Certificate Registrar and the Authenticating Agent, without the consent of any
of the Certificateholders, (a) to cure any ambiguity or error, (b) to correct or
supplement any provisions herein or therein which may be inconsistent with any
other provisions herein or therein, (c) to add any other provisions with respect
to matters or questions arising under this Agreement, which shall not be
inconsistent with the provisions of this Agreement, (d) to comply with any
requirements imposed by the Code, (e) to modify the provisions regarding the
transferability of the Residual Certificates, (f) to establish a "qualified
reserve fund" within the meaning of Code Section 860G(a)(7)(B) or (g) to
maintain the status of the Trust Fund as separate Constituent REMICs. This
Agreement may also be amended by the Depositor, the Servicer and the Trustee,
without Certificateholder consent, if the Depositor delivers an Opinion of
Counsel acceptable to the Trustee to the effect that such amendment will not
materially adversely affect the interests of the Certificateholders. In lieu of
an Opinion of Counsel, the Depositor may deliver a confirmation from each Rating
Agency that such amendment will not cause a downgrade, qualification or
withdrawal with respect to any affected Certificates. The Trustee hereby agrees
to execute and deliver any amendment to this Agreement provided by the Depositor
to it that conforms to the applicable provisions of the preceding three
sentences of this paragraph; provided, however, that the Trustee may, but shall
not be obligated to, enter into any such amendment that affects the Trustee's
own rights, duties or immunities under this Agreement.
This Agreement may also be amended from time to time by the Depositor,
the Servicer, the Certificate Administrator, the Trustee, the Paying Agent, the
Certificate Registrar and the Authenticating Agent with the consent of the
Holders of Certificates evidencing, in the aggregate, not less than 66-2/3% of
the Voting Interest of the Certificates affected by such amendment (after giving
effect to each proviso to the definition of "Outstanding"; and provided that if
any Class of Certificates is affected differently in any material respect by
such amendment than the other affected Classes, the consent of the Holders of
Certificates evidencing 66-2/3% of the Voting Interest of each such differently
affected Class shall be required) and, if the Class CE Certificates are
materially and adversely affected by such amendment, 66-2/3% of the Percentage
Interests of the Class CE Certificates then Outstanding, and, if the Residual
Certificates are materially and adversely affected by such amendment, 66-2/3% of
the Percentage Interests of the Residual Certificates then Outstanding, 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 of the Certificates; provided, however, that (i) in connection with
any such amendment, the Depositor shall deliver an Opinion of Counsel acceptable
to the Trustee (x) identifying any Class of Certificates that may be affected
differently in any material respect than the other affected Classes (or stating
that there is no such differently affected Class) and (y) identifying any Class
whose Certificateholders would not be affected by such amendment and (ii) no
such amendment shall, without the consent of the Holders of all Certificates
then Outstanding, (a) reduce in any manner the amount of, or delay the timing
of, collections or payments received on Mortgage Loans or distributions which
are required to be made on any Certificate or (b) reduce the aforesaid
percentage required to consent to any such amendment. Promptly after the
execution of any such amendment or consent the Trustee shall furnish or cause to
be furnished written notification of the substance of such amendment (or a copy
thereof) to each Certificateholder.
It shall not be necessary for the consent of Certificateholders under
this Section 10.01 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 the Certificateholders shall be subject to such reasonable
requirements as the Trustee may prescribe. Any proposed amendment is subject to
the receipt by the Trustee, at the expense of the party proposing such amendment
(or at the expense of the Trust Fund if proposed by the Trustee) that the
amendment will not cause any Constituent REMIC to fail to qualify as a REMIC or
subject any Constituent REMIC to tax.
Prior to entering into any amendment pursuant to this Section, the
Trustee may request and rely upon an Opinion of Counsel stating that the
proposed amendment is permissible under this Agreement and that all conditions
precedent, if any, to the entering into of such amendment have been fulfilled.
Section 10.02 Recordation of Agreement.
This Agreement is subject to recordation in all appropriate public
offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated and in which this Agreement may be recorded, and in any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Depositor and at its expense upon request of the Trustee, who
will act at the direction of the Holders of a majority by Percentage Interest of
the Residual Certificates, but only upon request of the Trustee accompanied by
an Opinion of Counsel, provided at the expense of such Holders, to the effect
that such recordation materially and beneficially affects the interests of the
Certificateholders; provided, however, that recordation of this Agreement shall
not be required unless recordation of each assignment relating to the Mortgages
is required to be made pursuant to Section 7.01.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 10.03 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate to
terminate this Agreement or the Trust Fund, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust
Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided in
Section 10.01) or in any manner otherwise control the operation and management
of the Trust Fund or the obligations of the parties hereto, nor shall anything
herein set forth, or contained in the terms of the Certificates, be construed so
as to constitute the Certificateholders from time to time as partners (except to
the extent provided in Code Section 860F(e) with respect to Holders of Residual
Certificates) or members of an association; nor shall any Certificateholder be
under any liability to any third person by reason of any action taken by the
parties to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of default and of the continuance thereof as hereinbefore provided, and unless
also the Holders of the Required Amount of Certificates shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder, or to enforce
any right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section 10.03, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 10.04 Governing Law.
This Agreement and the Certificates issued pursuant to this Agreement
shall be construed in accordance with the laws of the State of New York,
provided that the immunities and standards of care of the Trustee shall be
governed by the law of the jurisdiction in which is located its Corporate Trust
Office.
Section 10.05 Intention of Parties.
The execution and delivery of this Agreement shall constitute an
acknowledgment by CRMSI on behalf of the Certificateholders that it intends
hereby to establish and maintain (for federal income tax purposes) one or more
"real estate mortgage investment conduits" within the meaning of Code Section
860D and CRMSI and the Trustee are hereby granted all necessary powers to
further such intent.
Section 10.06 Notices.
Unless otherwise specified in this Agreement, all communications
relating to this Agreement including all demands and notices shall be in writing
and shall be deemed to have been duly given if personally delivered at or mailed
by first class mail, to the applicable address for notices set forth in Article
XII or, as to each party, at such other address as shall be designated by such
party in a written notice to each other party. Any notice required or permitted
to be mailed to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice; provided that notices to the Trustee
shall be effective only upon receipt.
Section 10.07 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 and terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.
Section 10.08 Assignment.
Except as provided in Sections 6.02, 6.04 and 6.06, this Agreement may
not be assigned by CRMSI or the Servicer without the prior written consent of
the Trustee.
Section 10.09 Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that the Certificateholders shall
not be personally liable for obligations of the Trust Fund, that the interests
represented by the Certificates shall be nonassessable for any reason
whatsoever, and that the Certificates upon due authentication thereof by the
Trustee are and shall be deemed fully paid.
Section 10.10 No Usurious Intent.
The amount of interest paid or payable on any Certificate shall be
limited to an amount that shall not exceed the maximum nonusurious rate of
interest which, under applicable New York law or any applicable United States
federal law, could be lawfully contracted for, charged or received.
Section 10.11 Counterparts.
This Agreement may be signed in any number of counterparts, each of
which will be deemed an original, which taken together shall constitute one and
the same instrument.
ARTICLE XI
DEPOSITORIES
Section 11.01 Depositories.
The Depositor may at any time and from time to time in its discretion
transfer the Certificate Account, the Collection Account or any Escrow Account
to a bank, savings and loan association or trust company organized under the
laws of the United States or any State thereof (an "eligible depository"). Upon
such transfer, such transferee bank, savings and loan association or trust
company shall be deemed to be a Depository with respect to the account or
accounts so transferred. In the event that the long-term debt obligations of any
Depository of the Certificate Account, Collection Account or Escrow Account
shall be rated at less than A by Fitch if Fitch is a Rating Agency, or the
short-term debt obligations of such Depository shall be rated by S&P at less
than A-2 (or BBB+ or above if it has no short-term debt rating) if S&P is a
Rating Agency, by Fitch at less than F-1 if Fitch is a Rating Agency and by
Moody's at less than P-1 if Xxxxx'x is a Rating Agency (the "Ratings
Requirements") and such account does not otherwise meet the requirements of this
Section 11.01, then within thirty days of such reduction, the Depositor shall
(A) transfer or direct the Paying Agent in writing to transfer the Certificate
Account, Collection Account or Escrow Account to an eligible depository
satisfying the Ratings Requirements, (B) establish another account in the
corporate trust department of the Paying Agent or if such Paying Agent has a
long-term and short-term debt rating at least equal to the Rating Requirements,
in any department of the Paying Agent (the "Alternative Certificate Account",
the "Alternative Collection Account" or the "Alternative Escrow Account", as the
case may be) and direct the Servicer to remit in accordance with this Agreement
any funds deposited into the Escrow Account to the Alternative Escrow Account,
and direct the Servicer to remit in accordance with this Agreement any funds
deposited into the Certificate Account or the Collection Account to the
Alternative Certificate Account or Alternative Collection Account, respectively,
(C) (i) cause such Depository to pledge securities in the manner provided by
applicable law or (ii) pledge or cause to be pledged securities, which shall be
held by the Paying Agent or its agent free and clear of the lien of any third
party, in a manner conferring on the Paying Agent a perfected first lien and
otherwise reasonably satisfactory to the Paying Agent; such pledge in either
case to secure such Depository's performance of its obligations in respect of
the Certificate Account, Collection Account or Escrow Account to the extent, if
any, that such obligation is not fully insured by the FDIC; provided, however,
that prior to the day a Depository or the Depositor, as the case may be, pledges
securities pursuant to this subsection (C), the Depositor and the Paying Agent
shall have received the written assurance of each Rating Agency that the
pledging of such securities and any arrangements or agreements relating thereto
will not result in a reduction or withdrawal of the then-current rating of the
Certificates, (D) establish an account or accounts or enter into an agreement so
that the existing Certificate Account, Collection Account or Escrow Account is
supported by a letter of credit or some other form of credit support which the
provider of such letter of credit or other form of credit support has a
long-term and short-term debt rating at least equal to the Rating Requirements;
provided, however, that prior to the establishment of such an account or the
entering into of such an agreement, the Depositor and the Paying Agent shall
have received written assurance from each Rating Agency that the establishment
of such an account or the entering into of such an agreement so that the
existing Certificate Account, Collection Account or Escrow Account is supported
by a letter of credit or some other form of credit support will not result in a
reduction or withdrawal of the then-current rating on the Certificates, (E)
establish another account which constitutes an Eligible Account or (F) make such
other arrangements as to which the Depositor and the Paying Agent have received
prior written assurance from each Rating Agency that such arrangement will not
result in a reduction or withdrawal of the then-current rating on the
Certificates. In the event that the rating on the Certificates has been
downgraded as a result of a rating downgrade of the Depository, for purposes of
this paragraph, the then-current rating on the Certificates shall be the rating
assigned to the Certificates prior to any such downgrade.
Appendix 1
TRANSFEREE'S AFFIDAVIT
AFFIDAVIT PURSUANT TO SECTION 860E(e)(4)
OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED
STATE OF )
):
COUNTY OF )
[ ], being first duly sworn, deposes and says:
1. That he is [_____________] of [____________] (the "Investor"), a
[state type of entity] duly organized and existing under the laws of the [State
of ___________] [United States], on behalf of which he makes this affidavit.
2. That the Investor's Taxpayer Identification Number is [________].
3. That the Investor is not a "disqualified organization" within the
meaning of Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended
(the "Code") or an ERISA Prohibited Holder, and will not be a "disqualified
organization" or an ERISA Prohibited Holder as of [Issue Date], 200[*], and that
the Investor is not acquiring a Citicorp Residential Mortgage Securities, Inc.
REMIC Pass-Through Certificates, Series 200[*]-[*] Class R Certificate (the
"Residual Certificate") for the account of, or as agent (including a broker,
nominee or other middleman) for, any person or entity from which it has not
received an affidavit substantially in the form of this affidavit. For these
purposes, a "disqualified organization" means the United States, any state or
political subdivision thereof, any foreign governments, any international
organization, any agency or instrumentality of any of the foregoing (other than
an instrumentality if all of its activities are subject to tax and a majority of
its board of directors is not appointed by such governmental entity), any
cooperative organization furnishing electric energy or providing telephone
service to persons in rural areas described in Code Section 1381(a)(2)(C), or
any organization (other than a farmers' cooperative described in Code Section
521) that is exempt from federal income tax unless such organization is subject
to the tax on unrelated business income imposed by Code Section 511. For these
purposes, an "ERISA Prohibited Holder" means an employee benefit plan the
investment of which is regulated under Section 406 of the Employee Retirement
Income Security Act of 1974, as amended, and/or Code Section 4975 or a
governmental plan, as defined in Section 3(32) of ERISA, subject to any federal,
state or local law which is, to a material extent, similar to the foregoing
provisions of ERISA or the Code (collectively, a "Plan") or a Person investing
the assets of a Plan.
4. That the Investor historically has paid its debts as they have come
due and intends to pay its debts as they come due in the future and the Investor
intends to pay taxes associated with holding the Residual Certificate as they
become due.
5. That the Investor understands that it may incur tax liabilities with
respect to the Residual Certificate in excess of cash flows generated by the
Residual Certificate.
6. That the Investor will not transfer the Residual Certificate to any
person or entity as to which the Investor has actual knowledge that the
requirements set forth in paragraph 3, paragraph 4, paragraph 7 or paragraph 10
hereof are not satisfied or that the Investor has reason to know does not
satisfy the requirements set forth in paragraph 4 hereof.
7. That the Investor (i) is not a Non-U.S. Person or (ii) is a Non-U.S.
Person that holds the Residual Certificate in connection with the conduct of a
trade or business within the United States and has furnished the transferor and
the Trustee with an effective Internal Revenue Service Form W-8ECI or (iii) is a
Non-U.S. Person that has delivered to both the transferor and the Trustee an
opinion of a nationally recognized tax counsel to the effect that the transfer
of the Residual Certificate to it is in accordance with the requirements of the
Code and the regulations promulgated thereunder and that such transfer of the
Residual Certificate will not be disregarded for federal income tax purposes.
"Non-U.S. Person" shall mean an individual, corporation, partnership or other
person other than a "U.S. Person." "U.S. Person" shall mean a citizen or
resident of the United States, a corporation, partnership (except to the extent
provided in applicable Treasury regulations) or other entity created or
organized in or under the laws of the United States or any jurisdiction thereof,
an estate that is subject to U.S. federal income tax regardless of the source of
its income or a trust if a court within the United States is able to exercise
primary supervision over the administration of such trust, and one or more such
U.S. Persons have the authority to control all substantial decisions of such
trust (or, to the extent provided in applicable Treasury regulations, certain
trusts in existence on August 20, 1996 which are eligible to be treated as U.S.
Persons).
8. That the Investor agrees to such amendments of the Pooling and
Servicing Agreement dated as of [Month] 1, 200[*], among Citicorp Residential
Mortgage Securities, Inc., CitiMortgage, Inc., Citibank, N.A. and U.S. Bank
National Association, as Trustee (the "Pooling and Servicing Agreement") as may
be required to further effectuate the restrictions on transfer of the Citicorp
Residential Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
200[*]-[*] Residual Certificate to such a "disqualified organization," an agent
thereof, an "ERISA Prohibited Holder" or a person that does not satisfy the
requirements of paragraphs 4, 5 and 7 hereof.
9. That the Investor consents to the irrevocable designation of the
[Trustee][Servicer] as its agent to act as agent for the "tax matters person" of
the REMIC pursuant to the Pooling and Servicing Agreement.
10. The Investor will not cause income from the Residual Certificate to
be attributable to a foreign permanent establishment or fixed base, within the
meaning of an applicable income tax treaty, of the Investor or any other U.S.
Person.
11. Check one of the following:
____ The present value of the anticipated tax liabilities
associated with holding the Residual Certificate does not exceed the sum
of:
(i) the present value of any consideration given to the Investor to
acquire the Residual Certificate;
(ii) the present value of the expected future distributions on the
Residual Certificate; and
(iii) the present value of the anticipated tax savings associated with
holding on the Residual Certificate as the REMIC generates losses.
For purposes of this calculation, (i) the Investor is assumed to pay tax
at the highest rate currently specified in Code Section 11(b) (but the tax rate
in Code Section 55(b)(1)(B) may be used in lieu of the highest rate specified in
Code Section 11(b) if the Investor has been subject to the alternative minimum
tax under Code Section 55 in the preceding two years and will compute its
taxable income in the current taxable year using the alternative minimum tax
rate) and (ii) present values are computed using a discount rate equal to the
short-term Federal rate prescribed by Code Section 1274(d) for the month of the
transfer and the compounding period used by the Investor.
_____ The transfer of the Residual Certificate complies with U.S.
Treasury Regulations Sections 1.860G-1(c)(5) and (6) and, accordingly,
(i) the Investor is an "eligible corporation," as defined in US.
Treasury Regulations Sections 1.860E-1(c)(6)(i), as to which income from
the Residual Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the Investor's two
fiscal years preceding the year of the transfer, the Investor had gross
assets for financial reporting purposes (excluding any obligation of a
person related to the Investor within the meaning of U.S. Treasury
Regulation Section 1.860E-1(c)(6)(ii)) in excess of $100 million and net
assets in excess of $10 million;
(iii) the Investor will transfer the Residual Certificate only to
another "eligible corporation," as defined in U.S. Treasury Regulations
Section 1.860E-1(c)(6)(i), in a transaction that satisfies the
requirements of U.S. Treasury Regulations Sections 1.860G-1(c)(4)(i),
(ii) and (iii) and 1.860E-1(c)(5); and
(iv) the Investor determined the consideration paid to it to acquire the
Residual Certificate based on reasonable market assumptions (including,
but not limited to, borrowing and investment rates, prepayment and loss
assumptions, expense and reinvestment assumptions, tax rates and other
factors specific to the Investor) that it has determined in good faith.
_____ None of the above.
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[________] this ____ day of 200_.
_____________________________________
By:__________________________________
Name:
Title:
COUNTY OF )
)
STATE OF )
Personally appeared before me the above-named [___________], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [___________] of the Investor, and acknowledged to me that he executed
the same as his free act and deed and the free act and deed of the Investor.
Subscribed and sworn to before me this ___ day of ________ 200__.
