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CITIGROUP MORTGAGE LOAN TRUST INC.,
Depositor
CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC,
Seller
▇▇▇▇▇▇ LOAN SERVICING LP,
Servicer
and
U.S. BANK NATIONAL ASSOCIATION,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of October 1, 2004
2004-CB7 Trust
C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB7
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms...................................................................................8
Section 1.02 Accounting.....................................................................................58
Section 1.03 Allocation of Certain Interest Shortfalls......................................................58
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans...................................................................60
Section 2.02 Acceptance by the Trustee......................................................................62
Section 2.03 Repurchase or Substitution of Mortgage Loans by the Seller.....................................63
Section 2.04 Representations and Warranties of the Seller with Respect to the Mortgage Loans................66
Section 2.05 Representations, Warranties and Covenants of the Servicer......................................67
Section 2.06 Representations and Warranties of the Depositor................................................69
Section 2.07 Representations and Warranties of the Seller...................................................70
Section 2.08 Covenants of the Seller........................................................................72
Section 2.09 Conveyance of REMIC 1 Regular Interests and Acceptance of REMIC 1 by the Trustee;
Issuance of Certificates.......................................................................73
Section 2.10 Conveyance of Class B-2 Interest and Acceptance of REMIC 3 by the Trustee; Issuance of
the Class B-2 Certificates.....................................................................73
Section 2.11 Conveyance of Class B-3 Interest and Acceptance of REMIC 4 by the Trustee; Issuance of
the Class B-3 Certificates.....................................................................74
Section 2.12 Conveyance of Class B-4 Interest and Acceptance of REMIC 5 by the Trustee; Issuance of
the Class B-4 Certificates.....................................................................74
Section 2.13 Conveyance of Class X/N Interest and Acceptance of REMIC 6 by the Trustee; Issuance of
the Class X/N Certificates.....................................................................75
ARTICLE III
ADMINISTRATION AND SERVICING OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer....................................................................76
Section 3.02 Collection of Mortgage Loan Payments...........................................................78
Section 3.03 Realization Upon Defaulted Mortgage Loans......................................................78
Section 3.04 Collection Account and Distribution Account....................................................79
Section 3.05 Permitted Withdrawals From the Collection Account..............................................81
Section 3.06 Establishment of Escrow Accounts; Deposits in Escrow Accounts..................................82
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Section 3.07 Permitted Withdrawals From Escrow Account......................................................82
Section 3.08 Payment of Taxes, Insurance and Other Charges; Collections Thereunder..........................83
Section 3.09 Transfer of Accounts...........................................................................83
Section 3.10 Maintenance of Hazard Insurance................................................................84
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy............................................84
Section 3.12 Fidelity Bond, Errors and Omissions Insurance..................................................85
Section 3.13 Title, Management and Disposition of REO Property..............................................85
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution Agreements....................................87
Section 3.15 Notification of Adjustments....................................................................88
Section 3.16 Optional Purchases of Mortgage Loans by Servicer...............................................88
Section 3.17 Trustee to Cooperate; Release of Files.........................................................89
Section 3.18 Servicing Compensation.........................................................................90
Section 3.19 Annual Statement as to Compliance..............................................................90
Section 3.20 Annual Independent Certified Public Accountants' Reports.......................................91
Section 3.21 Access to Certain Documentation and Information Regarding the Mortgage Loans...................91
Section 3.22 Commission Reporting...........................................................................92
Section 3.23 Obligations of the Servicer in Respect of Compensating Interest................................93
Section 3.24 Obligations of the Servicer in Respect of Mortgage Interest Rates and Monthly Payments.........94
Section 3.25 Investment of Funds in the Collection Account and the Distribution Account.....................94
Section 3.26 Liability of Servicer; Indemnification.........................................................95
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged Properties.................................96
Section 3.28 Protection of Assets...........................................................................96
Section 3.29 Net WAC Rate Carryover Reserve Account.........................................................96
Section 3.30 Advance Facility...............................................................................98
ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions........................................................................101
Section 4.02 Distributions of Principal and Monthly Excess Cashflow Amounts................................102
Section 4.03 Allocation of Losses..........................................................................109
Section 4.04 Method of Distribution........................................................................111
Section 4.05 Distributions on Book-Entry Certificates......................................................111
Section 4.06 Statements....................................................................................111
Section 4.07 Remittance Reports; Advances..................................................................114
Section 4.08 REMIC Distributions...........................................................................115
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates..............................................................................119
Section 5.02 Registration of Transfer and Exchange of Certificates.........................................119
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Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.............................................124
Section 5.04 Persons Deemed Owners.........................................................................124
Section 5.05 Appointment of Paying Agent...................................................................125
ARTICLE VI
THE SELLER, THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Seller, the Servicer and the Depositor.......................................126
Section 6.02 Merger or Consolidation of, or Assumption of the Obligations of, the Seller, the Servicer
or the Depositor..............................................................................126
Section 6.03 Limitation on Liability of the Servicer and Others............................................126
Section 6.04 Servicer Not to Resign........................................................................127
Section 6.05 Delegation of Duties..........................................................................128
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination................................................................129
Section 7.02 Trustee to Act; Appointment of Successor......................................................131
Section 7.03 Waiver of Defaults............................................................................132
Section 7.04 Notification to Certificateholders............................................................132
Section 7.05 Survivability of Servicer Liabilities.........................................................132
ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of Trustee.............................................................................133
Section 8.02 Certain Matters Affecting the Trustee.........................................................134
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.........................................136
Section 8.04 Trustee May Own Certificates..................................................................136
Section 8.05 Seller to Pay Trustee Fees and Expenses.......................................................137
Section 8.06 Eligibility Requirements for Trustee..........................................................137
Section 8.07 Resignation or Removal of Trustee.............................................................138
Section 8.08 Successor Trustee.............................................................................138
Section 8.09 Merger or Consolidation of Trustee............................................................139
Section 8.10 Appointment of Co-Trustee or Separate Trustee.................................................139
Section 8.11 Limitation of Liability.......................................................................140
Section 8.12 Trustee May Enforce Claims Without Possession of Certificates.................................141
Section 8.13 Suits for Enforcement.........................................................................141
Section 8.14 Waiver of Bond Requirement....................................................................141
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement.....................................141
Section 8.16 Compliance with National Housing Act of 1934..................................................142
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ARTICLE IX
REMIC ADMINISTRATION
Section 9.01 REMIC Administration..........................................................................143
Section 9.02 Prohibited Transactions and Activities........................................................145
Section 9.03 Indemnification with Respect to Certain Taxes and Loss of REMIC Status........................145
ARTICLE X
TERMINATION
Section 10.01 Termination...................................................................................147
Section 10.02 Additional Termination Requirements...........................................................148
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.....................................................................................150
Section 11.02 Recordation of Agreement; Counterparts........................................................151
Section 11.03 Limitation on Rights of Certificateholders....................................................151
Section 11.04 Governing Law; Jurisdiction...................................................................152
Section 11.05 Notices.......................................................................................152
Section 11.06 Severability of Provisions....................................................................153
Section 11.07 Article and Section References................................................................153
Section 11.08 Notice to the Rating Agencies.................................................................153
Section 11.09 Further Assurances............................................................................154
Section 11.10 Benefits of Agreement.........................................................................154
Section 11.11 Acts of Certificateholders....................................................................154
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EXHIBITS:
Exhibit A-1 Form of Class AV-1 Certificates
Exhibit A-2 Form of Class AV-2A Certificates
Exhibit A-3 Form of Class AV-2B Certificates
Exhibit A-4 .Form of Class AV-2C Certificates
Exhibit A-5 Form of Class AF-1 Certificates
Exhibit A-6 Form of Class AF-2 Certificates
Exhibit A-7 Form of Class AF-3 Certificates
Exhibit A-8 Form of Class AF-4 Certificates
Exhibit A-9 Form of Class AF-5 Certificates
Exhibit B-1 Form of Class B-1 Certificates
Exhibit B-2 Form of Class B-2 Certificates
Exhibit B-3 Form of Class B-3 Certificates
Exhibit B-4 Form of Class B-4 Certificates
Exhibit C-1-1 Form of Class R Certificates
Exhibit C-1-2 Form of Class R-X Certificates
Exhibit C-2 Form of Class M-1 Certificates
Exhibit C-3 Form of Class M-2 Certificates
Exhibit C-4 Form of Class M-3 Certificates
Exhibit C-5 Form of Class X Certificates
Exhibit C-6 Form of Class N Certificates
Exhibit D Mortgage Loan Schedule
Exhibit E Form of Request for Release
Exhibit F-1 Form of Trustee's or Custodian's Initial Certification
Exhibit F-2 Form of Trustee's or Custodian's Final Certification
Exhibit F-3 Form of Receipt of Mortgage Note
Exhibit G Mortgage Loan Purchase Agreement
Exhibit H Form of Lost Note Affidavit
Exhibit I Form of ERISA Representation
Exhibit J-1 Form of Investment Letter [Non-Rule 144A]
Exhibit J-2 Form of Investment Letter [Rule 144A]
Exhibit K Form of Residual Certificate Transfer Affidavit
Exhibit L Form of Transferor Certificate
Exhibit M Monthly Information Provided by Servicer
Exhibit N Form of Officer's Certificate with Respect to Prepayments
Exhibit O-1 Form of Certification to Be Provided by the Servicer with Form 10-K
Exhibit O-2 Form of Certification to Be Provided to the Servicer by the Trustee
Exhibit P Form of Power of Attorney
Exhibit Q Form of Cap Contracts
This Pooling and Servicing Agreement is dated as of October 1,
2004 (the "Agreement"), among CITIGROUP MORTGAGE LOAN TRUST INC., as depositor
(the "Depositor"), CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC, as
seller (the "Seller"), ▇▇▇▇▇▇ LOAN SERVICING LP, as servicer (the "Servicer")
and U.S. BANK NATIONAL ASSOCIATION, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple Classes,
which in the aggregate will evidence the entire beneficial ownership interest in
the Trust Fund created hereunder. The Certificates will consist of fifteen
Classes of Certificates, designated as (i) the Class AV-1 Certificates, the
Class AV-2A Certificates, the Class AV-2B Certificates, the Class AV-2C
Certificates, the Class AF-1 Certificates, the Class AF-2 Certificates, the
Class AF-3 Certificates, the Class AF-4 Certificates and the Class AF-5
Certificates, (ii) the Class M-1 Certificates, Class M-2 Certificates and the
Class M-3 Certificates, (iii) the Class B-1 Certificates, the Class B-2
Certificates, the Class B-3 Certificates and the Class B-4 Certificates, (iv)
the Class N Certificates, (v) the Class X Certificates and (vi) the Class R
Certificates and the Class R-X Certificates.
REMIC 1
-------
As provided herein, the Trustee will make an election to treat
the segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement (but exclusive of the Net WAC Rate
Carryover Reserve Account and the Cap Contracts) as a real estate investment
conduit (a "REMIC") for federal income tax purposes, and such segregated pool of
assets will be designated as "REMIC 1." The Class R-1 Interest will represent
the sole class of "residual interests" in REMIC 1 for purposes of the REMIC
Provisions under federal income tax law. The following table irrevocably sets
forth the designation, the Uncertificated REMIC 1 Pass-Through Rate, the initial
Uncertificated Principal Balance, and solely for purposes of satisfying Treasury
regulation Section 1.860G-1(a)(4)(iii), the "latest possible maturity date" for
each of the REMIC 1 Regular Interests. None of the REMIC 1 Regular Interests
will be certificated.
UNCERTIFICATED REMIC 1 INITIAL LATEST POSSIBLE
DESIGNATION PASS-THROUGH RATE UNCERTIFICATED BALANCE MATURITY DATE(1)
----------- ----------------- ---------------------- ----------------
LT1AA Variable(2) $ 235,358,890.15 November 2034
LT1AV1 Variable(2) $ 687,045.00 November 2034
LT1AV2A Variable(2) $ 412,110.00 November 2034
LT1AV2B Variable(2) $ 143,035.00 November 2034
LT1AV2C Variable(2) $ 131,895.00 November 2034
LT1AF1 3.128% per annum $ 272,550.00 November 2034
LT1AF2 3.887% per annum $ 128,285.00 November 2034
LT1AF3 4.644% per annum $ 35,000.00 November 2034
LT1AF4 5.118% per annum $ 53,920.00 November 2034
LT1AF5 4.585% per annum $ 69,465.00 November 2034
LT1M1 Variable(2) $ 138,090.00 November 2034
LT1M2 Variable(2) $ 114,080.00 November 2034
LT1M3 Variable(2) $ 31,220.00 November 2034
LT1B1 Variable(2) $ 30,020.00 November 2034
LT1B2 Variable(2) $ 26,415.00 November 2034
LT1B3 Variable(2) $ 24,020.00 November 2034
LT1B4 Variable(2) $ 37,225.00 November 2034
LT1ZZ Variable(2) $ 2,468,867.66 November 2034
LT1SUB Variable(2) $ 6,657.03 November 2034
LT1GRP Variable(2) $ 34,138.73 November 2034
LT2SUB Variable(2) $ 2,709.29 November 2034
LT2GRP Variable(2) $ 13,893.69 November 2034
LT1XX Variable(2) $ 240,104,734.05 November 2034
----------------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date
for the Mortgage Loan with the latest maturity date has been designated as
the "latest possible maturity date" for each REMIC 1 Regular Interest.
(2) Calculated in accordance with the definition of "Uncertificated REMIC 1
Pass-Through Rate" herein.
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REMIC 2
-------
As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the REMIC 1 Regular Interests
as a REMIC for federal income tax purposes, and such segregated pool of assets
will be designated as "REMIC 2." The Class R-2 Interest represents the sole
class of "residual interests" in REMIC 2 for purposes of the REMIC Provisions.
The following table sets forth the Class designation, Pass-Through Rate and
Original Class Certificate Principal Balance for each Class of Certificates or
REMIC 2 Regular Interests that represents one or more of the "regular interests"
in REMIC 2 created hereunder:
ORIGINAL CLASS
PASS-THROUGH CERTIFICATE PRINCIPAL ASSUMED FINAL
CLASS DESIGNATION RATE BALANCE MATURITY DATE(1)
----------------- ---- ------- ----------------
Class AV-1.................. Variable(2) (3) $ 137,409,000.00 November 2034
Class AV-2A................. Variable(2) (3) $ 82,422,000.00 November 2034
Class AV-2B................. Variable(2) (3) $ 28,607,000.00 November 2034
Class AV-2C................. Variable(2) (3) $ 26,379,000.00 November 2034
Class AF-1.................. 3.128% per annum(3) $ 54,510,000.00 November 2034
Class AF-2.................. 3.887% per annum(3) $ 25,657,000.00 November 2034
Class AF-3.................. 4.644% per annum(3) $ 7,000,000.00 November 2034
Class AF-4.................. 5.118% per annum(3) $ 10,784,000.00 November 2034
Class AF-5.................. 4.585% per annum(3) $ 13,893,000.00 November 2034
Class M-1................... Variable(2) (3) $ 27,618,000.00 November 2034
Class M-2 .................. Variable(2) (3) $ 22,816,000.00 November 2034
Class M-3................... Variable(2) (3) $ 6,244,000.00 November 2034
Class B-1................... Variable(2) (3) $ 6,004,000.00 November 2034
Class B-2 Interest.......... Variable(2) (3) $ 5,283,000.00 November 2034
Class B-3 Interest.......... Variable(2) (3) $ 4,804,000.00 November 2034
Class B-4 Interest.......... Variable(2) (3) $ 7,445,000.00 November 2034
Class X/N Interest ......... Variable(2) (3) $ 13,449,265.61(4) November 2034
------------------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for each Class of Certificates that
represents one or more of the "regular interests" in REMIC 2.
(2) Calculated in accordance with the definition of "Pass-Through Rate" herein.
(3) Subject to increase and subject to a cap in accordance with the definition
of "Pass-Through Rate" herein. (4) The Class X/N Interest will accrue
interest at its variable Pass-Through Rate on the Notional Amount of the
Class X/N Interest outstanding from time to time which shall equal the
aggregate of the Uncertificated Principal Balances of the REMIC 1 Regular
Interests. The Class X/N Interest will not accrue interest on its Class
Certificate Principal Balance.
(4) The Class X/N Interest will accrue interest at its variable Pass-Through
Rate on the Notional Amount of the Class X/N Interest outstanding from time
to time which shall equal the aggregate of the Uncertificated Principal
Balances of the REMIC 1 Regular Interests. The Class X/N Interest will not
accrue interest on its Class Certificate Principal Balance.
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REMIC 3
-------
As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class B-2 Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 3." The Class R-3 Interest represents the sole class of
"residual interests" in REMIC 3 for purposes of the REMIC Provisions. The
following table sets forth the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the Class of Certificates that represent
the "regular interest" in REMIC 3 created hereunder:
ORIGINAL CLASS
PASS-THROUGH CERTIFICATE PRINCIPAL ASSUMED FINAL
CLASS DESIGNATION RATE BALANCE MATURITY DATE(1)
----------------- ---- ------- ----------------
Class B-2................... Variable(2) $ 5,283,000.00 November 2034
------------------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for the Class of Certificates that
represent the "regular interest" in REMIC 3.
(2) The Class B-2 Certificates will receive 100% of amounts received in respect
of the Class B-2 Interest.
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REMIC 4
-------
As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class B-3 Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 4." The Class R-4 Interest represents the sole class of
"residual interests" in REMIC 4 for purposes of the REMIC Provisions. The
following table sets forth the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the Class of Certificates that represent
the "regular interest" in REMIC 4 created hereunder:
ORIGINAL CLASS
PASS-THROUGH CERTIFICATE PRINCIPAL ASSUMED FINAL
CLASS DESIGNATION RATE BALANCE MATURITY DATE(1)
----------------- ---- ------- ----------------
Class B-3................... Variable(2) $ 4,804,000.00 November 2034
------------------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for the Class of Certificates that
represent the "regular interest" in REMIC 4.
(2) The Class B-3 Certificates will receive 100% of amounts received in respect
of the Class B-3 Interest.
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REMIC 5
-------
As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class B-4 Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 5." The Class R-5 Interest represents the sole class of
"residual interests" in REMIC 5 for purposes of the REMIC Provisions. The
following table sets forth the Class designation, Pass-Through Rate and Original
Class Certificate Principal Balance for the Class of Certificates that represent
the "regular interest" in REMIC 5 created hereunder:
ORIGINAL CLASS
CERTIFICATE PRINCIPAL ASSUMED FINAL
CLASS DESIGNATION PASS-THROUGH RATE BALANCE MATURITY DATE(1)
----------------- ----------------- ------- ----------------
Class B-4................... Variable(2) $ 7,445,000.00 November 2034
------------------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for the Class of Certificates that
represent the "regular interest" in REMIC 5.
(2) The Class B-4 Certificates will receive 100% of amounts received in respect
of the Class B-4 Interest.
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REMIC 6
As provided herein, the Trustee shall make an election to
treat the segregated pool of assets consisting of the Class X/N Interest as a
REMIC for federal income tax purposes, and such segregated pool of assets will
be designated as "REMIC 6." The Class R-6 Interest represents the sole class of
"residual interests" in REMIC 6 for purposes of the REMIC Provisions. The
following table sets forth (or describes) the Class designation, Pass-Through
Rate and Original Class Certificate Principal Balance for the Class of
Certificates that represent the "regular interest" in REMIC 6 created hereunder.
The Class X/N Certificates will not be certificated.
ORIGINAL CLASS
PASS-THROUGH CERTIFICATE ASSUMED FINAL
CLASS DESIGNATION RATE PRINCIPAL BALANCE MATURITY DATE(1)
----------------- ---- ----------------- ----------------
Class X/N................... Variable(2) $ 20,610,000.00 November 2034
------------------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date following the maturity date for the
Mortgage Loan with the latest maturity date has been designated as the
"latest possible maturity date" for the Class of Certificates that
represent the "regular interest" in REMIC 6.
(2) The Class X/N Certificates will receive 100% of amounts received in respect
of the Class X/N Interest.
In addition to the above Certificates, the Trust Fund shall
issue two additional Classes of Certificates, designated as the Class N
Certificates and the Class X Certificates. For federal income tax purposes, in
the event that the beneficial ownership of the Class N Certificates and the
Class X Certificates is held by different investors for tax purposes, the
Trustee shall treat the Class N Certificates as debt of the Class X
Certificateholders for federal income tax purposes and shall not treat such
Class of Certificates as an interest in any REMIC created hereunder. In the
event that the beneficial ownership of the Class N Certificates and the Class X
Certificates is held by the same investor, the Trustee shall treat the Class N
Certificates as not having been issued for federal income tax purposes so that
the entire economic entitlement of the Class N Certificates and Class X
Certificates (excluding the Class X Certificates right to receive amounts from
the Net WAC Rate Carryover Reserve Account) will represent a "regular interest"
in REMIC 6. The following table irrevocably sets forth the designation, the
Pass-Through Rate, the Notional Amount for the Class N Certificates and the
Class X Certificates.
ASSUMED FINAL
CLASS DESIGNATION PASS-THROUGH RATE NOTIONAL AMOUNT MATURITY DATE
----------------- ----------------- --------------- -------------
Class N..................... 6.00% per annum $ 20,610,000.00 November 2034
Class X..................... Variable(1) N/A November 2034
------------------
(1) The Class X Certificates are entitled to all amounts remaining following
distributions on the Class N Certificates in accordance with Section
4.02(B)(II)(vi).
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ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary
Statement, the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article. Unless otherwise
specified, interest on the Floating Rate Certificates will be calculated on the
basis of the actual number of days in the related Interest Accrual Period and a
360-day year. Interest on the Fixed Rate Certificates and the Class N
Certificates and the Class X Certificates will be calculated on the basis of a
360-day year consisting of twelve 30-day months.
"1933 Act": The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": Each Mortgage Loan with respect to
which any portion of a Monthly Payment is, as of the last day of the prior
Collection Period, two months or more past due, each Mortgage Loan in
foreclosure, all REO Property and each Mortgage Loan for which the Mortgagor has
filed for bankruptcy after the Closing Date.
"Account": Either the Collection Account or the Distribution
Account.
"Accrued Certificate Interest": With respect to each
Distribution Date and each Class of Certificates and the Class B-2 Interest, the
Class B-3 Interest, the Class B-4 Interest and the Class X/N Interest, an amount
equal to the interest accrued at the applicable rate set forth or described
opposite such Class in the table in the Preliminary Statement during the related
Interest Accrual Period on the Certificate Principal Balance or uncertificated
Principal Balance (or Notional Amount) of such Class immediately prior to such
Distribution Date, reduced by such Class's Interest Percentage of Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution
Date allocated to such Certificates as provided in Section 1.03 hereof.
"Adjustable-Rate Mortgage Loan": A Group I Mortgage Loan which
has a rate at which interest accrues that adjusts based on an Index plus a
related Gross Margin, as set forth and subject to the limitations in the related
Mortgage Note.
"Adjustment Date": With respect to each Adjustable-Rate
Mortgage Loan, each adjustment date on which the Mortgage Interest Rate of an
Adjustable-Rate Mortgage Loan may change pursuant to the related Mortgage Note.
The first Adjustment Date following the Cut-off Date as to each Adjustable-Rate
Mortgage Loan is set forth in the Mortgage Loan Schedule.
"Advance": As to any Actuarial Mortgage Loan or REO Property,
any advance made by the Servicer in respect of any Distribution Date pursuant to
Section 4.07.
"Advance Facility": As defined in Section 3.30 hereof.
"Advance Facility Notice": As defined in Section 3.30 hereof.
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"Advance Financing Person": As defined in Section 3.30 hereof.
"Advance Reimbursement Amounts": As defined in Section 3.30
hereof.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
"Affiliate": With respect to any Person, any other Person
controlling, controlled by or under common control with such Person. For
purposes of this definition, "control" means the power to direct the management
and policies of a Person, directly or indirectly, whether through ownership of
voting securities, by contract or otherwise and "controlling" and "controlled"
shall have meanings correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all
amendments and supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all
federal, state and local laws, statutes, rules and regulations applicable
thereto, including with respect to each FHA Loan, the FHA Regulations and the
related FHA Insurance Contract.
"Applied Realized Loss Amount": With respect to each
Distribution Date, the excess, if any, of (a) the aggregate Certificate
Principal Balance of the Class A Certificates and the Mezzanine Certificates
(after giving effect to all distributions on such Distribution Date) over (b)
the Pool Balance as of the end of the related Collection Period.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect of
record the sale of the Mortgage.
"Assumed Final Maturity Date": As to each Class of
Certificates, the date set forth as such in the Preliminary Statement.
"Available Funds": As to any Distribution Date, an amount
equal to the excess of (i) the sum of (a) the aggregate of the Monthly Payments
due during the related Collection Period and received by the Trustee one
Business Day prior to the related Distribution Date, (b) Liquidation Proceeds,
Insurance Proceeds, Principal Prepayments, Subsequent Recoveries, Substitution
Adjustment Amounts, the Purchase Price for any repurchased Mortgage Loan, the
Termination Price with respect to the termination of the Trust pursuant to
Section 10.01 hereof and other unscheduled recoveries of principal and interest
(excluding Prepayment Charges) in respect of the Mortgage Loans during the
related Prepayment Period, (c) the aggregate of any amounts received in respect
of an REO Property withdrawn from any REO Account and deposited in the
Collection Account for such Distribution Date, (d) any Compensating Interest for
such Distribution Date, and (e) the aggregate of any Advances made by the
Servicer for such Distribution Date over (ii) the sum of (a) amounts
reimbursable or payable to the Servicer pursuant to Section 3.05, (b) Stayed
Funds, (c) the Servicing Fee and (d) amounts deposited in the Collection Account
or the Distribution Account, as the case may be, in error.
- 9 -
"Balloon Mortgage Loan": A Mortgage Loan that provides for the
payment of the unamortized principal balance of such Mortgage Loan in a single
payment at the maturity of such Mortgage Loan that is substantially greater than
the preceding monthly payment.
"Balloon Payment": A payment of the unamortized principal
balance of a Mortgage Loan in a single payment at the maturity of such Mortgage
Loan that is substantially greater than the preceding Monthly Payment.
"Bankruptcy Code": Title 11 of the United States Code, as
amended.
"Book-Entry Certificates": Any of the Certificates that shall
be registered in the name of the Depository or its nominee, the ownership of
which is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant," or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Class A Certificates and the Mezzanine Certificates shall be
Book-Entry Certificates.
"Business Day": Any day other than a Saturday, a Sunday or a
day on which banking institutions in the State of Delaware, the State of New
York, the State of Texas or in the city in which the Corporate Trust Office of
the Trustee is located are authorized or obligated by law or executive order to
be closed.
"Cap Contracts": The interest rate corridors between U.S. Bank
National Association, as Trustee, and the counterparty thereunder, for the
benefit of the Holders of (i) the Group I Certificates, (ii) the Class AF-1
Certificates and (iii) the Mezzanine Certificates, collectively, forms of which
are attached hereto as Exhibit H.
"Certificate": Any Regular Certificate, Class N Certificate,
Class X Certificate or Residual Certificate.
"Certificate Custodian": Initially, U.S. Bank National
Association; thereafter any other Certificate Custodian acceptable to the
Depository and selected by the Trustee.
"Certificate Owner": With respect to each Book-Entry
Certificate, any beneficial owner thereof.
"Certificate Principal Balance": With respect to any Class of
Certificates (other than the Class N, Class X and Residual Certificates) and any
Distribution Date, the Original Class Certificate Principal Balance, reduced by
the sum of (i) all amounts actually distributed in respect of principal of such
Class on all prior Distribution Dates (taking into account any increases in the
Certificate Principal Balance thereof due to the receipt of any Subsequent
Recoveries as provided in Section 4.02) and (ii) Applied Realized Loss Amounts
allocated thereto. The Class N, Class X and Residual Certificates do not have a
Certificate Principal Balance. With respect to any Certificate (other than a
Class N, Class X or a Residual Certificate) of a Class and any Distribution
Date, the portion of the Certificate Principal Balance of such Class represented
by such Certificate equal to the product of the Percentage Interest evidenced by
such Certificate and the Certificate Principal Balance of such Class.
- 10 -
"Certificate Register" and "Certificate Registrar": The
register maintained and registrar appointed pursuant to Section 5.02 hereof.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or non-U.S. Person shall not be a Holder of a Residual
Certificate for any purpose hereof.
"Class": Collectively, Certificates or REMIC Regular Interests
which have the same priority of payment and bear the same class designation and
the form of which is identical except for variation in the Percentage Interest
evidenced thereby.
"Class A Applied Realized Loss Amount": As to any Class of
Class A Certificates and as of any Distribution Date, the lesser of (x) the
Certificate Principal Balance thereof (after taking into account the
distribution of the Principal Remittance Amount and the Extra Principal
Distribution Amount, as applicable, on such Distribution Date, but prior to the
application of the Class A Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class M-1 Applied Realized
Loss Amount, the Class M-2 Applied Realized Loss Amount, the Class M-3 Applied
Realized Loss Amount, the Class B-1 Applied Realized Loss Amount, the Class B-2
Applied Realized Loss Amount, the Class B-3 Applied Realized Loss Amount and the
Class B-4 Applied Realized Loss Amount, in each case as of such Distribution
Date.
"Class A Certificate": Any one of the Class AV-1 Certificates,
the Class AV-2A Certificates, the Class AV-2B Certificates, the Class AV-2C
Certificates, the Class AF-1 Certificates, the Class AF-2 Certificates, the
Class AF-3 Certificates, the Class AF-4 Certificates or the Class AF-5
Certificates.
"Class A Realized Loss Amortization Amount": As to any Class
of Class A Certificates and as of any Distribution Date, the lesser of (x) the
Unpaid Realized Loss Amount for such Class of Class A Certificates as of such
Distribution Date and (y) the excess of (i) the Monthly Excess Cashflow Amount
over (ii) the sum of the amounts described in Section 4.02(B)(II)(i) hereof, in
each case for such Distribution Date.
"Class AF-1 Certificate": Any one of the Certificates with an
"AF-1" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-5, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AF-1 Interest Carry Forward Amount": For any
Distribution Date, the Interest Carry Forward Amount for the Class AF-1
Certificates for such Distribution Date.
"Class AF-1 Pass-Through Rate": For each Distribution Date,
the lesser of (i) prior to the Optional Termination Date, 3.128% per annum and
on or after the Optional Termination Date, 3.628% per annum and (ii) the related
Rate Cap for such Distribution Date.
"Class AF-2 Certificate": Any one of the Certificates with an
"AF-2" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-6, executed by the
- 11 -
Trustee on behalf of the Trust and authenticated and delivered by the
Certificate Registrar, representing the right to distributions as set forth
herein and therein.
"Class AF-2 Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AF-2 Certificates for such Distribution Date.
"Class AF-2 Pass-Through Rate": For each Distribution Date,
the lesser of (i) prior to the Optional Termination Date, 3.887% per annum and
on or after the Optional Termination Date, 4.387% per annum and (ii) the related
Rate Cap for such Distribution Date.
"Class AF-3 Certificate": Any one of the Certificates with an
"AF-3" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-7, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AF-3 Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AF-3 Certificates for such Distribution Date.
"Class AF-3 Pass-Through Rate": For each Distribution Date,
the lesser of (i) prior to the Optional Termination Date, 4.644% per annum and
on or after the Optional Termination Date, 5.144% per annum and (ii) the related
Rate Cap for such Distribution Date.
"Class AF-4 Certificate": Any one of the Certificates with an
"AF-4" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-8, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AF-4 Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AF-4 Certificates for such Distribution Date.
"Class AF-4 Pass-Through Rate": For each Distribution Date,
the lesser of (i) prior to the Optional Termination Date, 5.118% per annum and
on or after the Optional Termination Date, 5.618% per annum and (ii) the related
Rate Cap for such Distribution Date.
"Class AF-5 Certificate": Any one of the Certificates with an
"AF-5" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-9, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AF-5 Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AF-5 Certificates for such Distribution Date.
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"Class AF-5 Pass-Through Rate": For each Distribution Date,
the lesser of (i) prior to the Optional Termination Date, 4.585% per annum and
on or after the Optional Termination Date, 5.085% per annum and (ii) the related
Rate Cap for such Distribution Date.
"Class AV-1 Certificate": Any one of the Certificates with an
"AV-1" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-1, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AV-1 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
0.380% per annum, and (ii) on or after the Optional Termination Date, 0.760% per
annum.
"Class AV-1 Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AV-1 Certificates for such Distribution Date.
"Class AV-1 Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-1 Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.
"Class AV-2A Certificate": Any one of the Certificates with an
"AV-2A" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AV-2A Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
0.180% per annum, and (ii) on or after the Optional Termination Date, 0.360% per
annum.
"Class AV-2A Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AV-2A Certificates for such Distribution Date.
"Class AV-2A Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-2A Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.
"Class AV-2B Certificate": Any one of the Certificates with an
"AV-2B" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-3, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AV-2B Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
0.330% per annum, and (ii) on or after the Optional Termination Date, 0.660% per
annum.
"Class AV-2B Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AV-2B Certificates for such Distribution Date.
"Class AV-2B Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-2B Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.
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"Class AV-2C Certificate": Any one of the Certificates with an
"AV-2C" designated on the face thereof substantially in the form annexed hereto
as Exhibit A-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class AV-2C Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
0.520% per annum, and (ii) on or after the Optional Termination Date, 1.040% per
annum.
"Class AV-2C Interest Carry Forward Amount": For the Interest
Accrual Period for any Distribution Date, the Interest Carry Forward Amount for
the Class AV-2C Certificates for such Distribution Date.
"Class AV-2C Pass-Through Rate": For each Distribution Date,
the lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the
Class AV-2C Certificate Margin and (ii) the related Rate Cap for such
Distribution Date.
"Class B Certificate": Any one of the Class B-1 Certificates,
the Class B-2 Certificates, the Class B-3 Certificates or the Class B-4
Certificates.
"Class B-1 Applied Realized Loss Amount": As to the Class B-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-1 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class B-2 Applied Realized Loss Amount, the Class B-3 Applied
Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in each
case as of such Distribution Date.
"Class B-1 Certificate": Any one of the Certificates with a
"B-1" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-1, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class B-1 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
1.750% per annum, and (ii) on or after the Optional Termination Date, 2.625% per
annum.
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"Class B-1 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-1 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class B-1 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates on such
Distribution Date) and (v) the Certificate Principal Balance of the Class B-1
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 87.10% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date, but in no event less than zero.
"Class B-1 Realized Loss Amortization Amount": As to the Class
B-1 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(a) through (c) hereof, in each
case for such Distribution Date.
"Class B-2 Applied Realized Loss Amount": As to the Class B-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-2 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class B-3 Applied Realized Loss Amount and the Class B-4 Applied
Realized Loss Amount, in each case as of such Distribution Date.
"Class B-2 Certificate": Any one of the Certificates with a
"B-2" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class B-2 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
1.900% per annum, and (ii) on or after the Optional Termination Date, 2.850% per
annum.
"Class B-2 Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class B-2 Certificates and
representing a regular interest in REMIC 2.
- 15 -
"Class B-2 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-2 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class B-2 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates on such
Distribution Date), (v) the Certificate Principal Balance of the Class B-1
Certificates (after taking into account distributions of principal on the Class
B-1 Certificates on such Distribution Date) and (vi) the Certificate Principal
Balance of the Class B-2 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 89.30% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the Pool
Balance as of the last day of the related Collection Period minus the product of
0.50% and the Pool Balance on the Cut-off Date, but in no event less than zero.
"Class B-2 Realized Loss Amortization Amount": As to the Class
B-2 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(a) through (d) hereof, in each
case for such Distribution Date.
"Class B-3 Applied Realized Loss Amount": As to the Class B-3
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-3 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
Class B-4 Applied Realized Loss Amount, in each case, as of such Distribution
Date.
"Class B-3 Certificate": Any one of the Certificates with a
"B-3" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-3, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class B-3 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
2.000% per annum, and (ii) on or after the Optional Termination Date, 3.000% per
annum.
"Class B-3 Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class B-3 Certificates and
representing a regular interest in REMIC 2.
- 16 -
"Class B-3 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-3 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class B-3 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates on such
Distribution Date), (v) the Certificate Principal Balance of the Class B-1
Certificates (after taking into account distributions of principal on the Class
B-1 Certificates on such Distribution Date), (vi) the Certificate Principal
Balance of the Class B-2 Certificates (after taking into account distributions
of principal on the Class B-2 Certificates on such Distribution Date) and (vi)
the Certificate Principal Balance of the Class B-3 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
91.30% and (ii) the Pool Balance as of the last day of the related Collection
Period and (B) the Pool Balance as of the last day of the related Collection
Period minus the product of 0.50% and the Pool Balance on the Cut-off Date, but
in no event less than zero.
"Class B-3 Realized Loss Amortization Amount": As to the Class
B-3 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(a) through (e) hereof, in each
case for such Distribution Date.
"Class B-4 Applied Realized Loss Amount": As to the Class B-4
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class B-4 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the Applied
Realized Loss Amount as of such Distribution Date.
"Class B-4 Certificate": Any one of the Certificates with a
"B-4" designated on the face thereof substantially in the form annexed hereto as
Exhibit B-4, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class B-4 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
2.000% per annum, and (ii) on or after the Optional Termination Date, 3.000% per
annum.
- 17 -
"Class B-4 Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class B-4 Certificates and
representing a regular interest in REMIC 2.
"Class B-4 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
B-4 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class B-4 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the sum of the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account distributions of principal on the Class A Certificates on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account distributions of principal on the Class
M-1 Certificates on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account distributions
of principal on the Class M-2 Certificates on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account distributions of principal on the Class M-3 Certificates on such
Distribution Date), (v) the Certificate Principal Balance of the Class B-1
Certificates (after taking into account distributions of principal on the Class
B-1 Certificates on such Distribution Date), (vi) the Certificate Principal
Balance of the Class B-2 Certificates (after taking into account distributions
of principal on the Class B-2 Certificates on such Distribution Date), (vii) the
Certificate Principal Balance of the Class B-3 Certificates (after taking into
account distributions of principal on the Class B-3 Certificates on such
Distribution Date) and (viii) the Certificate Principal Balance of the Class B-4
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 94.40% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date, but in no event less than zero.
"Class B-4 Realized Loss Amortization Amount": As to the Class
B-4 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(a) through (f) hereof, in each
case for such Distribution Date.
"Class M Certificate": Any one of the Class M-1 Certificates,
the Class M-2 Certificates or the Class M-3 Certificates.
"Class M-1 Applied Realized Loss Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class M-1 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class M-2 Applied Realized Loss Amount, the Class M-3 Applied
Realized Loss Amount, the Class B-1 Applied Realized Loss Amount, the Class B-2
Applied Realized Loss Amount, the Class B-3
- 18 -
Applied Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in
each case as of such Distribution Date.
"Class M-1 Certificate": Any one of the Certificates with an
"M-1" designated on the face thereof substantially in the form annexed hereto as
Exhibit C-2, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class M-1 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
0.670% per annum, and (ii) on or after the Optional Termination Date, 1.005% per
annum.
"Class M-1 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
M-1 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class M-1 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account
distributions of principal on the Class A Certificates on such Distribution
Date) and (ii) the Certificate Principal Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 72.50% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date, but in no event less than zero.
"Class M-1 Realized Loss Amortization Amount": As to the Class
M-1 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(i) hereof, in each case for such
Distribution Date.
"Class M-2 Applied Realized Loss Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class M-2 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class M-3 Applied Realized Loss Amount, the Class B-1 Applied
Realized Loss Amount, the Class B-2 Applied Realized Loss Amount, the Class B-3
Applied Realized Loss Amount and the Class B-4 Applied Realized Loss Amount, in
each case as of such Distribution Date.
"Class M-2 Certificate": Any one of the Certificates with an
"M-2" designated on the face thereof substantially in the form annexed hereto as
Exhibit C-3, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
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"Class M-2 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
1.150% per annum, and (ii) on or after the Optional Termination Date, 1.725% per
annum.
"Class M-2 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
M-2 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class M-2 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account
distributions of principal on the Class A Certificates on such Distribution
Date), (ii) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account distributions of principal on the Class M-1
Certificates on such Distribution Date) and (iii) the Certificate Principal
Balance of the Class M-2 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 82.00% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the Pool
Balance as of the last day of the related Collection Period minus the product of
0.50% and the Pool Balance on the Cut-off Date, but in no event less than zero.
"Class M-2 Realized Loss Amortization Amount": As to the Class
M-2 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(iii)(a) through (viii) hereof,
in each case for such Distribution Date.
"Class M-3 Applied Realized Loss Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Remittance Amount and the Extra Principal Distribution Amount on such
Distribution Date, but prior to the application of the Class M-3 Applied
Realized Loss Amount, if any, on such Distribution Date) and (y) the excess of
(i) the Applied Realized Loss Amount as of such Distribution Date over (ii) the
sum of the Class B-1 Applied Realized Loss Amount, the Class B-2 Applied
Realized Loss Amount, the Class B-3 Applied Realized Loss Amount and the Class
B-4 Applied Realized Loss Amount, in each case as of such Distribution Date.
"Class M-3 Certificate": Any one of the Certificates with an
"M-3" designated on the face thereof substantially in the form annexed hereto as
Exhibit C-4, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class M-3 Certificate Margin": For the Interest Accrual
Period for each Distribution Date (i) prior to the Optional Termination Date,
1.250% per annum, and (ii) on or after the Optional Termination Date, 1.875% per
annum.
- 20 -
"Class M-3 Pass-Through Rate": For each Distribution Date, the
lesser of (i) LIBOR as of the related LIBOR Determination Date, plus the Class
M-3 Certificate Margin and (ii) the related Rate Cap for such Distribution Date.
"Class M-3 Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the sum of (i) the aggregate Certificate
Principal Balance of the Class A Certificates (after taking into account
distributions of principal on the Class A Certificates on such Distribution
Date), (ii) the Certificate Principal Balance of the Class M-1 Certificates
(after taking into account distributions of principal on the Class M-1
Certificates on such Distribution Date), (iii) the Certificate Principal Balance
of the Class M-2 Certificates (after taking into account distributions of
principal on the Class M-2 Certificates on such Distribution Date) and (iv) the
Certificate Principal Balance of the Class M-3 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 84.60% and
(ii) the Pool Balance as of the last day of the related Collection Period and
(B) the Pool Balance as of the last day of the related Collection Period minus
the product of 0.50% and the Pool Balance on the Cut-off Date, but in no event
less than zero.
"Class M-3 Realized Loss Amortization Amount": As to the Class
M-3 Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(B)(II)(iii)(a) through (b) hereof, in
each case for such Distribution Date.
"Class N Certificate": Any one of the Class N Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-6, representing
the right to distributions as set forth herein and therein. The Class N
Certificates shall not represent an interest in any REMIC.
"Class R Certificate": The Class R Certificate executed by the
Trustee, and authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit C-1-1 and evidencing the
ownership of the Class R-1 Interest and the Class R-2 Interest.
"Class R-X Certificate": The Class R-X Certificate executed by
the Trustee, and authenticated and delivered by the Certificate Registrar,
substantially in the form annexed hereto as Exhibit C-1-2 and evidencing the
ownership of the Class R-3 Interest, the Class R-4 Interest, the Class R-5
Interest and the Class R-6 Interest.
"Class R-1 Interest": The uncertificated residual interest in
REMIC 1.
"Class R-2 Interest": The uncertificated residual interest in
REMIC 2.
"Class R-3 Interest": The uncertificated residual interest in
REMIC 3.
"Class R-4 Interest": The uncertificated residual interest in
REMIC 4.
"Class R-5 Interest": The uncertificated residual interest in
REMIC 5.
- 21 -
"Class R-6 Interest": The uncertificated residual interest in
REMIC 6.
"Class X Certificate": Any one of the Class X Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-5, representing
the right to distributions as set forth herein and therein.
"Class X/N Certificate": An uncertificated certificate in
REMIC 5 held by the Trustee on behalf of the holders of the Class X and Class N
Certificates and representing a regular interest in REMIC 6.
"Class X/N Interest": An uncertificated interest in REMIC 2
held by the Trustee on behalf of the holders of the Class X and Class N
Certificates and representing a regular interest in REMIC 2.
"Class X Distributable Amount": With respect to any
Distribution Date, the excess of (i) the aggregate of amounts distributable on
the Class X/N Certificates for such Distribution Date, over (ii) the aggregate
of amounts distributable to the Class N Certificates pursuant to Section
4.02(B).
"Closing Date": October 29, 2004.
"Code": The Internal Revenue Code of 1986, as it may be
amended from time to time.
"Collection Account": The account or accounts created and
maintained by the Servicer pursuant to Section 3.04, which shall be entitled
"Collection Account, ▇▇▇▇▇▇ Loan Servicing LP, as Servicer for the Trust under
the Pooling and Servicing Agreement dated as of October 1, 2004 among Citigroup
Mortgage Loan Trust Inc., as Depositor, Credit-Based Asset Servicing and
Securitization LLC, as Seller, ▇▇▇▇▇▇ Loan Servicing LP, as Servicer and U.S.
Bank National Association, as Trustee, in trust for registered Holders of
2004-CB7 Trust, C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7," and which must be an Eligible Account.
"Collection Period": With respect to any Distribution Date,
the period from the second day of the calendar month preceding the month in
which such Distribution Date occurs through the first day of the month in which
such Distribution Date occurs.
"Combined Loan-to-Value Ratio": As of any date and Mortgage
Loan, the fraction, expressed as a percentage, the numerator of which is the
Principal Balance of the Mortgage Loan plus the principal balance of any related
senior mortgage loan, and the denominator of which is the Value of the related
Mortgaged Property.
"Compensating Interest": As defined in Section 3.23 hereof.
"Condemnation Proceeds": All awards or settlements in respect
of a taking of a Mortgaged Property by exercise of the power of eminent domain
or condemnation.
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"Conventional Mortgage Loan": Any Mortgage Loan that is not an
FHA Loan.
"Corporate Trust Office": With respect to the Trustee, the
principal corporate trust office of the Trustee at which at any particular time
its corporate trust business in connection with this Agreement shall be
administered, which office at the date of the execution of this instrument is
located at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Structured Finance, CMLT C-BASS 2004-CB7, or at such other address as the
Trustee may designate from time to time by notice to the Certificateholders, the
Depositor, the Servicer and the Seller.
"Corresponding Certificate": With respect to each REMIC 1
Regular Interest or REMIC II Regular Interest set forth below, the corresponding
Regular Certificate set forth in the table below:
REMIC 1 REGULAR INTEREST REGULAR CERTIFICATE
LT1AV1 Class AV-1
LT1AV2 Class AV-2A
LT1AV3 Class AV-2B
LT1AV4 Class AV-2C
LTAF1 Class AF-1
LTAF2 Class AF-2
LTAF3 Class AF-3
LTAF4 Class AF-4
LTAF5 Class AF-5
LT1M1 Class M-1
LT1M2 Class M-2
LT1M3 Class M-3
LT1B1 Class B-1
LT1B2, Class B-2 Interest Class B-2
LT1B3, Class B-3 Interest Class B-3
LT1B4, Class B-4 Interest Class B-4
Class X/N Interest Class X/N Certificates
"Custodial Agreement": The Custodial Agreement, dated as of
October 1, 2004, among the Trustee, the Servicer and the Custodian, as the same
may be amended or supplemented pursuant to the terms thereof.
"Custodian": The Bank of New York, a New York banking
corporation, or any successor custodian appointed pursuant to the terms of the
Custodial Agreement.
"Cut-off Date": October 1, 2004.
"Cut-off Date Principal Balance": With respect to any Mortgage
Loan, the unpaid principal balance thereof as of the Cut-off Date after
application of funds received or advanced on or before such date (or as of the
applicable date of substitution with respect to an Eligible Substitute Mortgage
Loan).
- 23 -
"DBRS": Dominion Bond Rating Service, Inc. and its successors,
and if such company shall for any reason no longer perform the functions of a
securities rating agency, "DBRS" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Securities and Exchange
Commission.
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be
replaced by one or more Eligible Substitute Mortgage Loans.
"Deferred Interest": With respect to any Mortgage Loan
identified on the Mortgage Loan Schedule as having the possibility of negative
amortization, the current portion of interest not currently paid by the
Mortgagor that is added to the principal balance of such Mortgage Loan.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, which valuation results from a proceeding initiated under the Bankruptcy
Code.
"Definitive Certificates": As defined in Section 5.02(c)
hereof.
"Delinquent": Any Mortgage Loan, the Monthly Payment due on a
Due Date with respect to which such monthly payment is not made by the close of
business on the next scheduled Due Date for such Mortgage Loan.
"Depositor": Citigroup Mortgage Loan Trust Inc., a Delaware
corporation, or any successor in interest.
"Depository": The initial depository shall be The Depository
Trust Company, whose nominee is Cede & Co., or any other organization registered
as a "clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(3) of the Uniform Commercial Code of
the State of New York.
"Depository Agreement": With respect to any Book-Entry
Certificates, the agreement among the Depositor, the Trustee and the initial
Depository, to be dated on or about the Closing Date.
"Depository Participant": A broker, dealer, bank or other
financial institution or other person for whom from time to time a Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
- 24 -
"Determination Date": With respect to any Distribution Date,
the 10th day of the calendar month in which such Distribution Date occurs or, if
such 10th day is not a Business Day, the Business Day immediately preceding such
10th day.
"Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the tenants thereof, the management or
operation of such REO Property, the holding of such REO Property primarily for
sale to customers, the performance of any construction work thereon or any use
of such REO Property in a trade or business conducted by the Trust other than
through an Independent Contractor; provided, however, that the Trustee (or the
Servicer under this Agreement) shall not be considered to Directly Operate an
REO Property solely because the Trustee (or the Servicer under this Agreement)
establishes rental terms, chooses tenants, enters into or renews leases, deals
with taxes and insurance, or makes decisions as to repairs or capital
expenditures with respect to such REO Property.
"Disqualified Organization": A "disqualified organization"
under Section 860E of the Code, which as of the Closing Date is any of: (i) the
United States, any state or political subdivision thereof, any possession of the
United States, any foreign government, any international organization, or any
agency or instrumentality of any of the foregoing, (ii) any organization (other
than a cooperative described in Section 521 of the Code) which is exempt from
the tax imposed by Chapter 1 of the Code unless such organization is subject to
the tax imposed by Section 511 of the Code, (iii) any organization described in
Section 1381(a)(2)(C) of the Code, or (iv) any other Person so designated by the
Trustee based upon an Opinion of Counsel provided by nationally recognized
counsel to the Trustee that the holding of an ownership interest in a Residual
Certificate by such Person may cause the Trust Fund or any Person having an
ownership interest in any Class of Certificates (other than such Person) to
incur liability for any federal tax imposed under the Code that would not
otherwise be imposed but for the transfer of an ownership interest in a Residual
Certificate to such Person. A corporation will not be treated as an
instrumentality of the United States or of any state or political subdivision
thereof if all of its activities are subject to tax and a majority of its board
of directors is not selected by a governmental unit. The term "United States,"
"state" and "international organization" shall have the meanings set forth in
Section 7701 of the Code.
"Distribution Account": The trust account or accounts created
and maintained by the Trustee pursuant to Section 3.04(b) which shall be
entitled "Distribution Account, U.S. Bank National Association, as Trustee, in
trust for the registered Holders of 2004-CB7 Trust, C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB7" and which must be an Eligible
Account.
"Distribution Date": The 25th day of any calendar month, or if
such 25th day is not a Business Day, the Business Day immediately following such
25th day, commencing in November 2004.
"Distribution Information": The items calculated and reported
by the Trustee pursuant to Section 4.06(a)(i), (ii), (iii) and (xiv) through
(xxii) and any other information included in the Monthly Statement aggregated
and/or calculated by the Trustee from (a) information contained in the
Remittance Report or (b) other information furnished to the Trustee by the
Servicer pursuant to Section 4.07.
- 25 -
"Due Date": With respect to each Mortgage Loan and any
Distribution Date, the day of the calendar month in which such Distribution Date
occurs on which the Monthly Payment for such Mortgage Loan was due, exclusive of
any grace period.
"Eligible Account": Any of (i) an account or accounts
maintained with a federal or state chartered depository institution or trust
company the short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the short-term unsecured debt obligations of such holding
company) are rated "A-1" (or the equivalent) by each of the Rating Agencies at
the time any amounts are held on deposit therein, (ii) an account or accounts
the deposits in which are fully insured by the FDIC (to the limits established
by such corporation), the uninsured deposits in which account are otherwise
secured such that, as evidenced by an Opinion of Counsel delivered to the
Trustee and to each Rating Agency, the Certificateholders will have a claim with
respect to the funds in such account or a perfected first priority security
interest against such collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution with which such account is
maintained, (iii) a trust account or accounts maintained with the trust
department of a federal or state chartered depository institution, national
banking association or trust company acting in its fiduciary capacity or (iv) an
account otherwise acceptable to each Rating Agency without reduction or
withdrawal of their then current ratings of the Certificates as evidenced by a
letter from each Rating Agency to the Trustee. Eligible Accounts may bear
interest.
"Eligible Substitute Mortgage Loan": A mortgage loan
substituted for a Defective Mortgage Loan pursuant to the terms of this
Agreement which must, on the date of such substitution, (i) have an outstanding
principal balance, after application of all scheduled payments of principal and
interest due during or prior to the month of substitution, not in excess of, and
not more than 5% less than, the outstanding principal balance of the Defective
Mortgage Loan as of the Due Date in the calendar month during which the
substitution occurs, (ii) have a Mortgage Interest Rate, with respect to a
Fixed-Rate Mortgage Loan, not less than the Mortgage Interest Rate of the
Defective Mortgage Loan and not more than 1% in excess of the Mortgage Interest
Rate of such Defective Mortgage Loan, (iii) if an Adjustable-Rate Mortgage Loan,
have a Maximum Loan Rate not less than the Maximum Loan Rate for the Defective
Mortgage Loan, (iv) if an Adjustable-Rate Mortgage Loan, have a Minimum Loan
Rate not less than the Minimum Loan Rate of the Defective Mortgage Loan, (v) if
an Adjustable-Rate Mortgage Loan, have a Gross Margin equal to or greater than
the Gross Margin of the Defective Mortgage Loan, (vi) if an Adjustable-Rate
Mortgage Loan, have a next Adjustment Date not more than two months later than
the next Adjustment Date on the Defective Mortgage Loan, an Eligible Substitute
Mortgage Loan must have all Adjustment Dates occurring during the same Interest
Accrual Period during which Adjustment Dates occur with respect to the
substituted Mortgage Loan, (vii) have a remaining term to maturity not greater
than (and not more than one year less than) that of the Defective Mortgage Loan,
(viii) be current as of the date of substitution, (ix) have a Combined
Loan-to-Value Ratio as of the date of substitution equal to or lower than the
Combined Loan-to-Value Ratio of the Defective Mortgage Loan as of such date, (x)
have a risk grading determined by the Seller at least equal to the risk grading
assigned on the Defective Mortgage Loan, (xi) have been reunderwritten by the
Seller in accordance with the same underwriting criteria and guidelines as the
Defective Mortgage Loan and (xii) conform to each representation and warranty
set forth in Section 2.04 hereof applicable to the Defective Mortgage
- 26 -
Loan. In the event that one or more mortgage loans are substituted for one or
more Defective Mortgage Loans, the amounts described in clause (i) hereof shall
be determined on the basis of aggregate principal balances, the Mortgage
Interest Rates described in clause (ii) hereof shall be determined on the basis
of weighted average Mortgage Interest Rates, the risk gradings described in
clause (x) hereof shall be satisfied as to each such mortgage loan, the terms
described in clause (vii) hereof shall be determined on the basis of weighted
average remaining term to maturity, the Combined Loan-to-Value Ratios described
in clause (ix) hereof shall be satisfied as to each such mortgage loan and,
except to the extent otherwise provided in this sentence, the representations
and warranties described in clause (xii) hereof must be satisfied as to each
Eligible Substitute Mortgage Loan or in the aggregate, as the case may be.
"ERISA": The Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Restricted Certificates": Any of the Mezzanine
Certificates, Class N, Class X and Residual Certificates.
"Escrow Account": The account or accounts created and
maintained pursuant to Section 3.06.
"Escrow Payments": The amounts constituting ground rents,
taxes, assessments, water rates, mortgage insurance premiums, fire and hazard
insurance premiums and other payments required to be escrowed by the Mortgagor
with the mortgagee pursuant to any Mortgage Loan.
"Estate in Real Property": A fee simple estate in a parcel of
real property.
"Expense Fee Rate": The sum of (i) the Trustee Fee Rate and
(ii) the Servicing Fee Rate.
"Extended Period": As defined in Section 9.04(b).
"Extra Principal Distribution Amount": As of any Distribution
Date, the lesser of (x) the Monthly Excess Cashflow Amount for such Distribution
Date and (y) the Overcollateralization Deficiency for such Distribution Date.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"FHA": The Federal Housing Administration, an agency within
HUD.
"FHA Approved Mortgagee": Those institutions which are
approved by FHA to act as servicer and mortgagee of record pursuant to FHA
Regulations.
"FHA Insurance Contract" or "FHA Insurance": The contractual
obligation of FHA respecting the insurance of an FHA Loan pursuant to the
National Housing Act, as amended.
"FHA Loan": A Mortgage Loan which is the subject of an FHA
Insurance Contract as evidenced by a Mortgage Insurance Certificate.
- 27 -
"FHA Regulations": Regulations promulgated by HUD under the
National Housing Act, codified in 24 Code of Federal Regulations, and other HUD
issuances relating to FHA Loans, including the related handbooks, circulars,
notices and mortgagee letters.
"Fidelity Bond": Shall have the meaning assigned thereto in
Section 3.12.
"Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Seller or the Servicer pursuant to or as contemplated by
Section 2.03 or 10.01), a determination made by the Servicer that all Insurance
Proceeds, Liquidation Proceeds and other payments or recoveries which the
Servicer, in its reasonable good faith judgment, expects to be finally
recoverable in respect thereof have been so recovered. The Servicer shall
maintain records, prepared by a Servicing Officer, of each Final Recovery
Determination made thereby.
"Fitch": Fitch Ratings and its successors, and if such company
shall for any reason no longer perform the functions of a securities rating
agency, "Fitch" shall be deemed to refer to any other "nationally recognized
statistical rating organization" as set forth on the most current list of such
organizations released by the Securities and Exchange Commission.
"Fixed-Rate Mortgage Loan": A Group I Mortgage Loan or Group
II Mortgage Loan which has a constant annual rate at which interest accrues in
accordance with the provisions of the related Mortgage Note.
"Fixed Rate Certificates": The Group II Certificates.
"Floating Rate Certificates": The Group I Certificates and the
Mezzanine Certificates.
"Foreclosure Price": The amount reasonably expected to be
received from the sale of the related Mortgaged Property net of any expenses
associated with foreclosure proceedings.
"Gross Margin": With respect to each Adjustable-Rate Mortgage
Loan, the fixed percentage set forth in the related Mortgage Note that is added
to the Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Interest Rate for such Mortgage
Loan.
"Group I Certificates": The Class AV-1 Certificates, the Class
AV-2A Certificates, the Class AV-2B Certificates and the Class AV-2C
Certificates.
"Group I Enhancement Amount": As of any Distribution Date, an
amount equal to the excess of (x) the aggregate Principal Balance of the Group I
Mortgage Loans as of the last day of the related Collection Period over (y) the
aggregate Certificate Principal Balance of the Group I Certificates.
"Group I Interest Remittance Amount": As of any Determination
Date, the sum, without duplication, of (i) all interest due and collected or
advanced with respect to the related Collection Period on the Group I Mortgage
Loans (less the Servicing Fee, amounts available for
- 28 -
reimbursement of Advances and Servicing Advances pursuant to Section 3.05 and
expenses reimbursable pursuant to Section 6.03), (ii) all Compensating Interest
paid by the Servicer on such Determination Date with respect to the Group I
Mortgage Loans and (iii) the portion of any payment in connection with any
substitution, Purchase Price, Termination Price or Net Liquidation Proceeds
relating to interest with respect to the Group I Mortgage Loans received during
the related Prepayment Period.
"Group I Mortgage Loans": A Fixed-Rate Mortgage Loan or
Adjustable-Rate Mortgage Loan assigned to Loan Group I.
"Group I Principal Remittance Amount": With respect to any
Distribution Date, the sum (less amounts available for reimbursement of Advances
and Servicing Advances pursuant to Section 3.05 and expenses reimbursable
pursuant to Section 6.03) of: (i) each payment of principal on a Group I
Mortgage Loan due during the related Collection Period and received by the
Servicer on or prior to the related Determination Date, and any Advances with
respect thereto, (ii) all full and partial Principal Prepayments on the Group I
Mortgage Loans received by the Servicer during the related Prepayment Period,
(iii) the Net Liquidation Proceeds allocable to principal on the Group I
Mortgage Loans and any Subsequent Recoveries on the Group I Mortgage Loans
actually collected by the Servicer during the related Prepayment Period, (iv)
with respect to Defective Mortgage Loans in Loan Group I repurchased with
respect to such Prepayment Period, the portion of the Purchase Price allocable
to principal, (v) any Substitution Adjustment Amounts with respect to the Group
I Mortgage Loans received on or prior to the previous Determination Date and not
yet distributed and (vi) on the Distribution Date on which the Trust is to be
terminated in accordance with Section 10.01 hereof, that portion of the
Termination Price in respect of principal on the Group I Mortgage Loans.
"Group I Senior Excess Interest Amount": With respect to any
Distribution Date, an amount equal to the excess, if any, of (x) the Group I
Interest Remittance Amount multiplied by a fraction, the numerator of which is
the aggregate Certificate Principal Balance of the Group I Certificates
(immediately prior to such Distribution Date) and the denominator of which is
the Principal Balance of the Group I Mortgage Loans as of the last day of the
preceding Collection Period over (y) the sum of (i) the amount of any
distributions of interest pursuant to Section 4.01(II) and (ii) the portion
allocated to the Group I Senior Excess Interest Amount of the excess, if any, of
(a) the aggregate Accrued Certificate Interest for the Mezzanine Certificates
over (b) the Interest Remittance Amount multiplied by a fraction, the numerator
of which is the sum of the aggregate Certificate Principal Balance of the
Mezzanine Certificates (immediately prior to such Distribution Date) and the
Overcollateralization Amount and the denominator of which is the Principal
Balance of the Mortgage Loans as of the last day of the preceding Collection
Period. For purposes of the foregoing, the shortfall described in clause (y)(ii)
will be allocated in the following order: first, to the Group II Senior Excess
Interest Amount and second, to the Group I Senior Excess Interest Amount.
"Group I Senior Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the aggregate Certificate Principal Balance
of the Group I Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 61.00% and (ii) the Principal Balance of
the Group I Mortgage Loans as of the last day of the related Collection Period
and
- 29 -
(B) the Principal Balance of the Group I Mortgage Loans as of the last day of
the related Collection Period minus the product of (i) 0.50% and (ii) the
Principal Balance of the Group I Mortgage Loans on the Cut-off Date, but in no
event less than zero.
"Group I Targeted Enhancement Amount": With respect to any
Distribution Date (i) prior to the Stepdown Date, $66,570,337.45, (ii) on or
after the Stepdown Date and on which a Trigger Event is in effect, the Group I
Targeted Enhancement Amount for the immediately preceding Distribution Date and
(iii) on or after the Stepdown Date and on which a Trigger Event is not in
effect, an amount equal to the Group I Enhancement Amount assuming the entire
Group I Senior Principal Distribution Amount had been distributed in full.
"Group II Certificates": The Class AF-1 Certificates, the
Class AF-2 Certificates, the Class AF-3 Certificates, the Class AF-4
Certificates and the Class AF-5 Certificates.
"Group II Enhancement Amount": As of any Distribution Date, an
amount equal to the excess of (x) the aggregate Principal Balance of the Group
II Mortgage Loans as of the last day of the related Collection Period over (y)
the aggregate Certificate Principal Balance of the Group II Certificates.
"Group II Interest Remittance Amount": As of any Determination
Date, the sum, without duplication, of (i) all interest due and collected or
advanced with respect to the related Collection Period on the Group II Mortgage
Loans (less the Servicing Fee, amounts available for reimbursement of Advances
and Servicing Advances pursuant to Section 3.05 and expenses reimbursable
pursuant to Section 6.03), (ii) all Compensating Interest paid by the Servicer
on such Determination Date with respect to the Group II Mortgage Loans and (iii)
the portion of any payment in connection with any substitution, Purchase Price,
Termination Price or Net Liquidation Proceeds relating to interest with respect
to the Group II Mortgage Loans received during the related Prepayment Period.
"Group II Mortgage Loans": A Fixed-Rate Mortgage Loan assigned
to Loan Group II.
"Group II Principal Remittance Amount": With respect to any
Distribution Date, the sum (less amounts available for reimbursement of Advances
and Servicing Advances pursuant to Section 3.05 and expenses reimbursable
pursuant to Section 6.03) of: (i) each payment of principal on a Group II
Mortgage Loan due during the related Collection Period and received by the
Servicer on or prior to the related Determination Date, and any Advances with
respect thereto, (ii) all full and partial Principal Prepayments on the Group II
Mortgage Loans received by the Servicer during the related Prepayment Period,
(iii) the Net Liquidation Proceeds allocable to principal on the Group II
Mortgage Loans and any Subsequent Recoveries on the Group II Mortgage Loans
actually collected by the Servicer during the related Prepayment Period, (iv)
with respect to Defective Mortgage Loans in Loan Group II repurchased with
respect to such Prepayment Period, the portion of the Purchase Price allocable
to principal, (v) any Substitution Adjustment Amounts with respect to the Group
II Mortgage Loans received on or prior to the previous Determination Date and
not yet distributed and (vi) on the Distribution Date on which the Trust is to
be terminated in accordance with Section 10.01 hereof, that portion of the
Termination Price in respect of principal on the Group II Mortgage Loans.
- 30 -
"Group II Senior Excess Interest Amount": With respect to any
Distribution Date, an amount equal to the excess, if any, of (x) the Group II
Interest Remittance Amount multiplied by a fraction, the numerator of which is
the aggregate Certificate Principal Balance of the Group II Certificates
(immediately prior to such Distribution Date) and the denominator of which is
the Principal Balance of the Group II Mortgage Loans as of the last day of the
preceding Collection Period over (y) the sum of (i) the amount of any
distributions of interest pursuant to Section 4.01(I) and (ii) the portion
allocated to the Group II Senior Excess Interest Amount of the excess, if any,
of (a) the aggregate Accrued Certificate Interest for the Mezzanine Certificates
over (b) the Interest Remittance Amount multiplied by a fraction, the numerator
of which is the sum of the aggregate Certificate Principal Balance of the
Mezzanine Certificates (immediately prior to such Distribution Date) and the
Overcollateralization Amount and the denominator of which is the Principal
Balance of the Mortgage Loans as of the last day of the preceding Collection
Period. For purposes of the foregoing, the shortfall described in clause (y)(ii)
will be allocated in the following order: first, to the Group II Senior Excess
Interest Amount and second, to the Group I Senior Excess Interest Amount.
"Group II Senior Principal Distribution Amount": As of any
Distribution Date on or after the Stepdown Date and as long as a Trigger Event
is not in effect, the excess of (x) the aggregate Certificate Principal Balance
of the Group II Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) the product of (i) 61.00% and (ii) the Principal Balance
of the Group II Mortgage Loans as of the last day of the related Collection
Period and (B) the Principal Balance of the Group II Mortgage Loans as of the
last day of the related Collection Period minus the product of (i) 0.50% and
(ii) the Principal Balance of the Group II Mortgage Loans on the Cut-off Date,
but in no event less than zero.
"Group II Targeted Enhancement Amount": With respect to any
Distribution Date, (i) prior to the Stepdown Date, $27,092,928.16, (ii) on or
after the Stepdown Date and on which a Trigger Event is in effect, the Group II
Targeted Enhancement Amount for the immediately preceding Distribution Date and
(iii) on or after the Stepdown Date and on which a Trigger Event is not in
effect, an amount equal to the Group II Enhancement Amount assuming the entire
Group II Senior Principal Distribution Amount had been distributed in full.
"Highest Priority": As of any date of determination, the Class
of Mezzanine Certificates or Class A Certificates then outstanding with a
Certificate Principal Balance greater than zero, with the highest priority for
payments pursuant to Section 4.02, in the following order: Class A, Class M-1,
Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4.
"HUD": The United States Department of Housing and Urban
Development, or any successor thereto and including the Federal Housing
Commissioner and the Secretary of Housing and Urban Development where
appropriate under the FHA Regulations.
"Independent": When used with respect to any specified Person,
any such Person who (i) is in fact independent of the Depositor, the Servicer
and their respective Affiliates, (ii) does not have any direct financial
interest in or any material indirect financial interest in the Depositor or the
Servicer or any Affiliate thereof, and (iii) is not connected with the Depositor
or the Servicer or any Affiliate thereof as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions;
provided, however, that a Person shall
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not fail to be Independent of the Depositor or the Servicer or any Affiliate
thereof merely because such Person is the beneficial owner of 1% or less of any
Class of securities issued by the Depositor or the Servicer or any Affiliate
thereof, as the case may be.
"Independent Contractor": Either (i) any Person (other than
the Servicer) that would be an "independent contractor" with respect to the
Trust Fund within the meaning of Section 856(d)(3) of the Code if the Trust Fund
were a real estate investment trust (except that the ownership tests set forth
in that section shall be considered to be met by any Person that owns, directly
or indirectly, 35 percent or more of any Class of Certificates), so long as the
Trust Fund does not receive or derive any income from such Person and provided
that the relationship between such Person and the Trust Fund is at arm's length,
all within the meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any
other Person (including the Servicer) if the Trustee has received an Opinion of
Counsel, which Opinion of Counsel shall be an expense of the Trust Fund, to the
effect that the taking of any action in respect of any REO Property by such
Person, subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code), or cause any income
realized in respect of such REO Property to fail to qualify as Rents from Real
Property.
"Index": With respect to each Adjustable-Rate Mortgage Loan
and with respect to each related Adjustment Date, the index as specified in the
related Mortgage Note.
"Initial Certificate Principal Balance": With respect to any
Certificate of a Class other than a Class N, Class X or Residual Certificate,
the amount designated "Initial Certificate Principal Balance" on the face
thereof.
"Initial Notional Amount": With respect to any Class N
Certificate, the amount designated "Initial Notional Amount" on the face
thereof.
"Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a Mortgage Loan, to the extent such
proceeds are not to be applied to the restoration of the related Mortgaged
Property or released to the Mortgagor in accordance with the procedures that the
Servicer would follow in servicing mortgage loans held for its own account,
subject to the terms and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution
Date and (i) with respect to the Floating Rate Certificates, the period from the
preceding Distribution Date to the day prior to the current Distribution Date
(or, in the case of the first Distribution Date, the period from the Closing
Date through November 25, 2004), and (ii) with respect to the Fixed Rate
Certificates, the Class N Certificates and the Class X Certificates, the
calendar month immediately preceding the month in which such Distribution Date
occurs.
"Interest Carry Forward Amount": For any Class of Certificates
(other than the Class X and Residual Certificates) and any Distribution Date,
the sum of (a) the excess, if any, of the Accrued Certificate Interest and any
Interest Carry Forward Amount for the prior Distribution Date, over the amount
in respect of interest actually distributed on such Class on
- 32 -
such prior Distribution Date and (b) interest on such excess at the applicable
Pass-Through Rate (i) with respect to the Floating Rate Certificates, for the
actual number of days elapsed on the basis of a 360-day year since the prior
Distribution Date and (ii) with respect to the Fixed Rate Certificates, on the
basis of a 360-day year consisting of twelve 30-day months.
"Interest Percentage": With respect to any Class of
Certificates, the Class B-2 Interest, the Class B-3 Interest, the Class B-4
Interest and the Class X/N Interest and any Distribution Date, the ratio
(expressed as a decimal carried to six places) of the Accrued Certificate
Interest for such Class to the sum of the Accrued Certificate Interest for all
such Classes, in each case with respect to such Distribution Date.
"Interest Remittance Amount": For any Distribution Date, the
sum of (i) the Group I Interest Remittance Amount and (ii) the Group II Interest
Remittance Amount for such Distribution Date.
"Late Collections": With respect to any Mortgage Loan, all
amounts received subsequent to the Determination Date immediately following any
related Collection Period, whether as late payments of Monthly Payments or as
Insurance Proceeds, Liquidation Proceeds or otherwise, which represent late
payments or collections of principal and/or interest due (without regard to any
acceleration of payments under the related Mortgage and Mortgage Note) but
delinquent on a contractual basis for such Collection Period and not previously
recovered.
"LIBOR": With respect to the Floating Rate Certificates and
each Interest Accrual Period, the rate determined by the Trustee on the related
LIBOR Determination Date on the basis of the offered rate for one month United
States dollar deposits, as such rate appears on the Telerate Page 3750, as of
11:00 a.m. (London time) on such LIBOR Determination Date. If no such quotations
are available on an LIBOR Determination Date, LIBOR for the related Interest
Accrual Period will be established by the Trustee as follows:
(i) If on such LIBOR Determination Date two or more
Reference Banks provide such offered quotations, LIBOR for the
related Interest Accrual Period shall be the arithmetic mean of
such offered quotations (rounded upwards if necessary to the
nearest whole multiple of 0.001%);
(ii) If on such LIBOR Determination Date fewer than two
Reference Banks provide such offered quotations, LIBOR for the
related Interest Accrual Period shall be the arithmetic mean of
the rates quoted by one or more major banks in New York City,
selected by the Trustee after consultation with the Depositor, as
of 11:00 A.M., New York City time, on such date for loans in U.S.
Dollars to leading European banks for a period of one month in
amounts approximately equal to the aggregate Certificate
Principal Balance of the Floating Rate Certificates; and
(iii) If no such quotations can be obtained, LIBOR for the
related Interest Accrual Period shall be LIBOR for the prior
Distribution Date.
"LIBOR Business Day": Any day on which banks in London,
England and The City of New York are open and conducting transactions in foreign
currency and exchange.
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"LIBOR Determination Date": With respect to any Interest
Accrual Period for the Floating Rate Certificates, the second LIBOR Business Day
preceding the first day of such Interest Accrual Period.
"Liquidated Mortgage Loan": As to any Distribution Date, any
Mortgage Loan in respect of which the Servicer has determined, in accordance
with the servicing procedures specified herein, as of the end of the related
Prepayment Period, that all Liquidation Proceeds and Insurance Proceeds which it
expects to recover with respect to the liquidation of the Mortgage Loan or
disposition of the related REO Property have been recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of
the following events: (i) such Mortgage Loan is paid in full; (ii) a Final
Recovery Determination is made as to such Mortgage Loan; or (iii) such Mortgage
Loan is removed from the Trust Fund by reason of its being purchased, sold or
replaced pursuant to or as contemplated by Section 2.03 or Section 10.01. With
respect to any REO Property, either of the following events: (i) a Final
Recovery Determination is made as to such REO Property; or (ii) such REO
Property is removed from the Trust Fund by reason of its being sold or purchased
pursuant to Section 3.13 or Section 10.01.
"Liquidation Proceeds": The amount (other than amounts
received in respect of the rental of any REO Property prior to REO Disposition)
received by the Servicer in connection with (i) the taking of all or a part of a
Mortgaged Property by exercise of the power of eminent domain or condemnation or
(ii) the liquidation of a defaulted Mortgage Loan by means of a trustee's sale,
foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated
Mortgage Loan in such form and containing such information as is agreed to by
the Servicer and the Trustee.
"Loan Group": Either Loan Group I or Loan Group II, as the
context requires.
"Loan Group I": The Group I Mortgage Loans.
"Loan Group II": The Group II Mortgage Loans.
"Lockout Certificate Percentage": With respect to the Class
AF-5 Certificates and any Distribution Date, the percentage equal to the
Certificate Principal Balance of the Class AF-5 Certificates immediately prior
to such Distribution Date divided by the aggregate Certificate Principal Balance
of the Group II Certificates immediately prior to such Distribution Date.
"Lockout Distribution Percentage": With respect to the Class
AF-5 Certificates and any Distribution Date, the indicated percentage of the
Lockout Certificate Percentage for such Distribution Date:
Distribution Date Occurring In Percentage
-------------------------------------------------------------
November 2004 through October 2007 0%
November 2007 through October 2009 45%
November 2009 through October 2010 80%
November 2010 through October 2011 100%
November 2011 and thereafter 300%
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"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to
which the original Mortgage Note has been permanently lost or destroyed and has
not been replaced, an affidavit from the Seller certifying that the original
Mortgage Note has been lost, misplaced or destroyed (together with a copy of the
related Mortgage Note and indemnifying the Trust against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note) in
the form of Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates
evidencing at least 51% of the Voting Rights.
"Majority Class R Certificateholders": The Holders of Residual
Certificates evidencing at least a 51% Percentage Interest in the applicable
Class of Residual Certificates.
"Marker Rate": With respect to the Class X/N Interest and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the Uncertificated REMIC 1 Pass-Through Rates for REMIC 1 Regular Interest
LT1AV1, REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2B,
REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1
Regular Interest LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1 Regular
Interest LT1AF4, REMIC 1 Regular Interest LT1AF5, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest
LT1B3, REMIC 1 Regular Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ, with
the rate on each such REMIC 1 Regular Interest (other than REMIC 1 Regular
Interest LT1ZZ) subject to a cap equal to the lesser of (i) (a) LIBOR as of the
related LIBOR Determination Date, plus the related Certificate Margin for the
Corresponding Certificate or (b) the fixed pass-through rate for the related
Corresponding Certificate, as applicable, and (ii) the related Rate Cap for such
Distribution Date, and with the rate on REMIC 1 Regular Interest LT1ZZ subject
to a cap of zero for the purpose of this calculation; provided, however, that
for this purpose, calculations of the Uncertificated REMIC 1 Pass-Through Rate
and the related caps with respect to REMIC 1 Regular Interest LT1AV1, REMIC 1
Regular Interest LTIAV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular
Interest LT1AV2B, REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC I
Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest
LT1B3 and REMIC 1 Regular Interest LT1B4 shall be multiplied by a fraction, the
numerator of which is the actual number of days elapsed in the related Interest
Accrual Period and the denominator of which is 30.
"Maximum Loan Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
maximum Mortgage Interest Rate thereunder.
"Maximum LT1ZZ Uncertificated Accrued Interest Deferral
Amount": With respect to any Distribution Date, the excess of (a) accrued
interest at the Uncertificated REMIC 1 Pass-Through Rate applicable to REMIC 1
Regular Interest LT1ZZ for such Distribution Date
- 35 -
on a balance equal to the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1ZZ minus the REMIC 1 Overcollateralized Amount, in each case for
such Distribution Date, over (b) Uncertificated Accrued Interest on REMIC 1
Regular Interest LT1AV1, REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular
Interest LT1AV2B, REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular Interest
LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC
1 Regular Interest LT1AF4, REMIC 1 Regular Interest LT1AF5, REMIC 1 Regular
Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular
Interest LT1B3 and REMIC 1 Regular Interest LT1B4 with the rate on each such
REMIC 1 Regular Interest subject to a cap equal to the lesser of (i) (a) LIBOR
as of the related LIBOR Determination Date, plus the related Certificate Margin
for the Corresponding Certificate or (b) the fixed pass-through rate for the
related Corresponding Certificate, as applicable, and (ii) the related Rate Cap
for such Distribution Date for the purpose of this calculation; provided,
however, that for this purpose, calculations of the Uncertificated REMIC 1
Pass-Through Rate and the related caps with respect to REMIC 1 Pass-Through Rate
and the related caps with respect to REMIC 1 Regular Interest LT1AV1, REMIC 1
Regular Interest LTIAV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular
Interest LT1AV2B, REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC I
Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest
LT1B3 and REMIC 1 Regular Interest LT1B4 shall be multiplied by a fraction, the
numerator of which is the actual number of days elapsed in the related Interest
Accrual Period and the denominator of which is 30.
"Mezzanine Certificates": Together, the Class M Certificates
and the Class B Certificates.
"Minimum Loan Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Interest Rate thereunder.
"Monthly Excess Cashflow Amount": The sum of (i) the Monthly
Excess Interest Amount and (ii) the Overcollateralization Release Amount.
"Monthly Excess Interest Amount": With respect to each
Distribution Date, the amount, if any, by which the Interest Remittance Amount
for such Distribution Date exceeds the aggregate amount distributed on such
Distribution Date pursuant to Section 4.01(I) through Section 4.01(III)(i)
through (vii).
"Monthly Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and interest on such Mortgage Loan which
is payable by the related Mortgagor from time to time under the related Mortgage
Note, determined: (a) after giving effect to (i) any Deficient Valuation and/or
Debt Service Reduction with respect to such Mortgage Loan and (ii) any reduction
in the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Servicer pursuant to Section 3.01; and (c) on the assumption that all other
amounts, if any, due under such Mortgage Loan are paid when due.
- 36 -
"Monthly Statement": The statement prepared and distributed by
the Trustee pursuant to Section 4.06(a).
"Moody's": ▇▇▇▇▇'▇ Investors Service, Inc. and its successors,
and if such company shall for any reason no longer perform the functions of a
securities rating agency, "Moody's" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Securities and Exchange
Commission.
"Mortgage": The mortgage, deed of trust or other instrument
creating a first or second lien on, or first or second priority security
interest in, a Mortgaged Property securing a Mortgage Note.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
"Mortgage Insurance Certificate": The certificate evidencing
an FHA Insurance Contract.
"Mortgage Interest Rate": With respect to each Mortgage Loan,
the annual rate at which interest accrues on such Mortgage Loan from time to
time in accordance with the provisions of the related Mortgage Note, which rate
(i) in the case of each Fixed-Rate Mortgage Loan shall remain constant at the
rate set forth in the Mortgage Loan Schedule as the Mortgage Interest Rate in
effect immediately following the Cut-off Date and (ii) in the case of each
Adjustable-Rate Mortgage Loan (A) as of any date of determination until the
first Adjustment Date following the Cut-off Date shall be the rate set forth in
the Mortgage Loan Schedule as the Mortgage Interest Rate in effect immediately
following the Cut-off Date and (B) as of any date of determination thereafter
shall be the rate as adjusted on the most recent Adjustment Date, to equal the
sum, rounded to the nearest 0.125% as provided in the Mortgage Note, of the
Index, determined as set forth in the related Mortgage Note, plus the related
Gross Margin subject to the limitations set forth in the related Mortgage Note.
With respect to each Mortgage Loan that becomes an REO Property, as of any date
of determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO Property.
"Mortgage Loan": Each mortgage loan transferred and assigned
to the Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to time
held as a part of the Trust Fund, the Mortgage Loans so held being identified in
the Mortgage Loan Schedule.
"Mortgage Loan Purchase Agreement": The agreement between the
Seller and the Depositor, dated as of October 28, 2004, regarding the transfer
of the Mortgage Loans by the Seller to or at the direction of the Depositor.
"Mortgage Loan Schedule": As of any date (i) with respect to
the Mortgage Loans, the list of such Mortgage Loans included in the Trust Fund
on such date, separately identifying the Group I Mortgage Loans and the Group II
Mortgage Loans, attached hereto as
- 37 -
Exhibit D. The Mortgage Loan Schedule shall be prepared by the Seller and
shall set forth the following information with respect to each Mortgage Loan:
(1) the Seller's Mortgage Loan identifying number;
(2) the city, state, and zip code of the Mortgaged Property;
(3) the type of Residential Dwelling constituting the
Mortgaged Property or a designation that the Mortgaged Property is a
multi-family property;
(4) the occupancy status of the Mortgaged Property at
origination;
(5) the original months to maturity;
(6) the date of origination;
(7) the first payment date;
(8) the stated maturity date;
(9) the stated remaining months to maturity;
(10) the original principal amount of the Mortgage Loan;
(11) the Principal Balance of each Mortgage Loan as of the
Cut-off Date;
(12) [reserved];
(13) the Mortgage Interest Rate of the Mortgage Loan as of the
Cut-off Date;
(14) the current principal and interest payment of the
Mortgage Loan as of the Cut-off Date;
(15) the contractual interest paid to date of the Mortgage
Loan;
(16) if the Mortgage Loan is not owner-financed, the Combined
Loan-to-Value Ratio at origination;
(17) a code indicating the loan performance status of the
Mortgage Loan as of the Cut-off Date;
(18) a code indicating whether the Mortgage Loan is a Simple
Interest Mortgage Loan or an Actuarial Mortgage Loan;
(19) a code indicating whether the Mortgaged Property is in
bankruptcy or in its forbearance period as of the Cut-off Date;
(20) a code indicating whether the Mortgage Loan is
conventional or insured by the FHA;
- 38 -
(21) with respect to each Adjustable-Rate Mortgage Loan, a
code indicating the Index that is associated with such Mortgage Loan,
the Gross Margin, the Periodic Rate Cap, the Minimum Loan Rate, the
Maximum Loan Rate, the first Adjustment Date immediately following the
Cut-off Date, the rate adjustment frequency and the payment adjustment
frequency;
(22) a code indicating whether the Mortgage Loan has a
Prepayment Charge and the type of Prepayment Charge;
(23) a code indicating whether the Mortgage Loan is
owner-financed;
(24) a code indicating whether the Mortgage Loan is subject to
negative amortization; and
(25) a code indicating whether the Mortgage Loan is a second
lien.
The Mortgage Loan Schedule shall set forth the following
information, as of the Cut-off Date, with respect to the Mortgage Loans in the
aggregate, for the Group I Mortgage Loans and for the Group II Mortgage Loans:
(1) the number of Mortgage Loans; (2) the current Principal Balance of the
Mortgage Loans; (3) the weighted average Mortgage Interest Rate of the Mortgage
Loans; and (4) the weighted average maturity of the Mortgage Loans. The Mortgage
Loan Schedule shall be amended from time to time by the Seller in accordance
with the provisions of this Agreement. With respect to any Eligible Substitute
Mortgage Loan, Cut-off Date shall refer to the related Cut-off Date for such
Mortgage Loan, determined in accordance with the definition of Cut-off Date
herein.
"Mortgage Note": The original executed note or other evidence
of indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage
Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on
Exhibit D from time to time, and any REO Properties acquired in respect thereof.
"Mortgaged Property": The underlying property securing a
Mortgage Loan, including any REO Property, consisting of an Estate in Real
Property improved by a Residential Dwelling or multi-family dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated
Mortgage Loan or any other disposition of related Mortgaged Property (including
REO Property) the related Liquidation Proceeds net of Advances, Servicing
Advances, Servicing Fees and any other accrued and unpaid servicing fees
received and retained in connection with the liquidation of such Mortgage Loan
or Mortgaged Property.
"Net Mortgage Interest Rate": With respect to any Mortgage
Loan, the Mortgage Interest Rate borne by such Mortgage Loan minus the Expense
Fee Rate.
- 39 -
"Net WAC Rate Carryover Amount": For any Distribution Date and
any Class A Certificate or Mezzanine Certificate, the excess of (i) the amount
of interest accrued on such Certificate based on the related Pass-Through Rate
(without regard to the related Rate Cap), over (ii) the amount of interest
accrued on such Certificate based on the related Rate Cap, together with the
unpaid portion of any such excess from prior Distribution Dates (and interest
accrued thereon at the then applicable Pass-Through Rate (without regard to the
related Rate Cap) on such Certificate.
"Net WAC Rate Carryover Reserve Account": The reserve account
established and maintained pursuant to Section 3.29.
"New Lease": Any lease of REO Property entered into on behalf
of the Trust, including any lease renewed or extended on behalf of the Trust if
the Trust has the right to renegotiate the terms of such lease.
"Nonrecoverable Advance": Any Advance or Servicing Advance
previously made or proposed to be made in respect of a Mortgage Loan that, in
the good faith business judgment of the Servicer, will not or, in the case of a
proposed Advance or Servicing Advance, would not be ultimately recoverable from
Late Collections on such Mortgage Loan as provided herein.
"Notional Amount": Immediately prior to any Distribution Date,
with respect to the Class X/N Interest, the aggregate Uncertificated Principal
Balance of the REMIC 1 Regular Interests. With respect to the Class N
Certificates, an amount equal to the Original Class N Notional Amount reduced by
the aggregate distributions made to the Class N Certificates pursuant to Section
4.02(B)(II)(v).
"Offered Certificates": The Class A Certificates and the
Mezzanine Certificates (other than the Class B-2, Class B-3 and Class B-4
Certificates).
"Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), or by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries of the Servicer, the Seller or the
Depositor, as applicable.
"Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be a salaried counsel for the Depositor or the Servicer
except that any opinion of counsel relating to (a) the qualification of any
REMIC as a REMIC or (b) compliance with the REMIC Provisions must be an opinion
of Independent counsel.
"Optional Termination Date": The first Distribution Date on
which the Servicer or an Affiliate of the Servicer may opt to terminate the
Mortgage Pool pursuant to Section 10.01.
"Original Class N Notional Amount": The Notional Amount of the
Class N Certificates on the Closing Date, as set forth opposite such Class in
the Preliminary Statement.
"Original Class Certificate Principal Balance": With respect
to each Class of Certificates, the Certificate Principal Balance thereof on the
Closing Date, as set forth opposite
- 40 -
such Class in the Preliminary Statement, except with respect to the Class N,
Class X and Residual Certificates, which have an Original Class Certificate
Principal Balance of zero.
"Overcollateralization Amount": As of any Distribution Date,
the excess of (x) the Pool Balance as of the last day of the immediately
preceding Collection Period over (y) the aggregate Certificate Principal Balance
of the Class A Certificates and the Mezzanine Certificates (after taking into
account all distributions of principal on such Distribution Date).
"Overcollateralization Deficiency": As of any Distribution
Date, the excess, if any, of (x) the Targeted Overcollateralization Amount for
such Distribution Date over (y) the Overcollateralization Amount for such
Distribution Date, calculated for this purpose after taking into account the
reduction on such Distribution Date of the aggregate Certificate Principal
Balance of the Class A Certificates and the Mezzanine Certificates resulting
from the distribution of the Principal Remittance Amount on such Distribution
Date, but prior to taking into account any Applied Realized Loss Amounts on such
Distribution Date.
"Overcollateralization Release Amount": With respect to any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, the lesser of (x) the Principal Remittance Amount for such Distribution
Date and (y) the excess, if any, of (i) the Overcollateralization Amount for
such Distribution Date (assuming that 100% of the Principal Remittance Amount is
applied as a principal distribution on the Class A Certificates and the
Mezzanine Certificates on such Distribution Date), over (ii) the Targeted
Overcollateralization Amount for such Distribution Date.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof and any other interest therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate": Any of the Class AV-1 Pass-Through Rate,
the Class AV-2A Pass-Through Rate, the Class AV-2B Pass-Through Rate, the Class
AV-2C Pass-Through Rate, the Class AF-1 Pass-Through Rate, the Class AF-2
Pass-Through Rate, the Class AF-3 Pass-Through Rate, the Class AF-4 Pass-Through
Rate, the Class AF-5 Pass-Through Rate, the Class M-1 Pass-Through Rate, the
Class M-2 Pass-Through Rate, the Class M-3 Pass-Through Rate, the Class B-1
Pass-Through Rate, the Class B-2 Pass-Through Rate, the Class B-3 Pass-Through
Rate and the Class B-4 Pass-Through Rate. With respect to the Class N
Certificates, the Pass-Through Rate is 10.00% per annum. With respect to the
Class X/N Interest and any Distribution Date, a per annum rate equal to the
percentage equivalent of a fraction, the numerator of which is the sum of the
amounts calculated pursuant to clauses (A) through (R) below, and the
denominator of which is the aggregate Uncertificated Principal Balance of REMIC
1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular
Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular Interest
LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC
1 Regular Interest LT1AF3, REMIC 1 Regular Interest LT1AF4, REMIC 1 Regular
Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular Interest LT1B4
and REMIC 1 Regular
- 41 -
Interest LT1ZZ. For purposes of calculating the Pass-Through Rate for the Class
X/N Interest, the numerator is equal to the sum of the following components:
(A) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AA minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AA;
(B) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV1;
(C) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV2A minus the Marker Rate, applied to an amount equal to
the Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV2A;
(D) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV2B minus the Marker Rate, applied to an amount equal to
the Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV2B;
(E) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AV2C minus the Marker Rate, applied to an amount equal to
the Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AV2C;
(F) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AF1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AF1;
(G) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AF2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AF2;
(H) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AF3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AF3;
(I) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AF4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AF4;
(J) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1AF5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1AF5;
(K) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1M1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M1;
- 42 -
(L) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1M2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M2;
(M) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1M3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M3;
(N) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B1;
(O) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B2;
(P) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B3;
(Q) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1B4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B4; and
(R) the Uncertificated REMIC 1 Pass-Through Rate for REMIC 1
Regular Interest LT1ZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ.
"Paying Agent": Any paying agent appointed pursuant to Section
5.05.
"Percentage Interest": With respect to any Certificate (other
than a Class N, Class X or Residual Certificate), a fraction, expressed as a
percentage, the numerator of which is the Initial Certificate Principal Balance,
as the case may be, represented by such Certificate and the denominator of which
is the Original Class Certificate Principal Balance of the related Class. With
respect to a Class N Certificate, the undivided percentage interest obtained by
dividing the Initial Notional Amount evidenced by such Certificate by the
Original Class N Notional Amount. With respect to a Class X or Residual
Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%.
"Periodic Rate Cap": With respect to each Adjustable-Rate
Mortgage Loan and any Adjustment Date therefor, the fixed percentage set forth
in the related Mortgage Note, which is the maximum amount by which the Mortgage
Interest Rate for such Mortgage Loan may increase or decrease (without regard to
the Maximum Loan Rate or the Minimum Loan Rate) on such Adjustment Date from the
Mortgage Interest Rate in effect immediately prior to such Adjustment Date.
- 43 -
"Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued or managed by the Depositor, the Servicer, the
Trustee or any of their respective Affiliates or for which an Affiliate of the
Trustee serves as an advisor:
(i) direct obligations of, or obligations fully guaranteed
as to timely payment of principal and interest by, the United
States or any agency or instrumentality thereof, provided such
obligations are backed by the full faith and credit of the United
States;
(ii) (A) demand and time deposits in, certificates of
deposit of, bankers' acceptances issued by or federal funds sold
by any depository institution or trust company (including the
Trustee or its agents 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 and/or state authorities, so long as, at
the time of such investment or contractual commitment providing
for such investment, such depository institution or trust company
or its ultimate parent has a short term uninsured debt rating in
one of the two highest available rating categories of S&P (i.e.,
A-1+ and A-1) and Moody's and the highest available rating
category of Fitch and DBRS provided that each such investment has
an original maturity of no more than 365 days and (B) any other
demand or time deposit or deposit which is fully insured by the
FDIC;
(iii) repurchase obligations with a term not to exceed 30
days with respect to any security described in clause (i) above
and entered into with a depository institution or trust company
(acting as principal) rated A-1 or higher by S&P, Fitch and DBRS
and rated A2 or higher by Moody's, provided, however, that
collateral -------- ------- transferred pursuant to such
repurchase obligation must be of the type described in clause (i)
above and must (A) be valued daily at current market prices plus
accrued interest or (B) pursuant to such valuation, be equal, at
all times, to 105% of the cash transferred by the Trustee in
exchange for such collateral and (C) be delivered to the Trustee
or, if the Trustee is supplying the collateral, an agent for the
Trustee, in such a manner as to accomplish perfection of a
security interest in the collateral by possession of certificated
securities;
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of the
United States of America or any State thereof and that are rated
by each Rating Agency in its highest long-term unsecured rating
categories at the time of such investment or contractual
commitment providing for such investment;
- 44 -
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on
demand or on a specified date not more than 30 days after the
date of acquisition thereof) that is rated by each Rating Agency
in its highest short-term unsecured debt rating available at the
time of such investment;
(vi) units of money market funds registered under the
Investment Company Act of 1940 including funds managed or advised
by the Trustee or affiliates thereof having the highest rating
category by the applicable Rating Agency; and
(vii) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other
obligation, security or investment, as may be acceptable to the
Rating Agencies in writing as a permitted investment of funds
backing securities having ratings equivalent to its highest
initial rating of the Class A Certificates;
provided, that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of the
yield to maturity at par of the underlying obligations.
"Permitted Transferee": Any transferee of a Residual
Certificate other than a Disqualified Organization or a non-U.S. Person.
"Person": 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.
"Pool Balance": As of any date of determination, the aggregate
Principal Balance of the Mortgage Loans.
"Prepayment Assumption": As set forth in the Prospectus
Supplement.
"Prepayment Charge": With respect to any Prepayment Period,
any prepayment premium, fee or charge payable by the a Mortgagor in connection
with any Principal Prepayment pursuant to the terms of the related Mortgage
Note.
"Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan that was during the related Prepayment
Period the subject of a Principal Prepayment in full that was applied by the
Servicer to reduce the outstanding principal balance of such loan on a date
preceding the related Due Date, an amount equal to interest at the applicable
Mortgage Interest Rate (net of the Servicing Fee Rate) on the amount of such
Principal Prepayment for the number of days commencing on the date on which the
prepayment is applied and ending on the last day of the related Prepayment
Period.
"Prepayment Period": With respect to any Distribution Date,
the calendar month preceding the month in which such Distribution Date occurs.
"Principal Balance": As to any Mortgage Loan and any day,
other than a Liquidated Mortgage Loan, the related Cut-off Date Principal
Balance, minus all collections credited against the principal balance of any
such Mortgage Loan and the principal portion of Advances plus, Deferred
Interest, if any. For purposes of this definition, a Liquidated Mortgage Loan
shall be deemed to have a Principal Balance equal to the Principal Balance of
the related Mortgage Loan as of the final recovery of related Liquidation
Proceeds and a Principal Balance
- 45 -
of zero thereafter. As to any REO Property and any day, the Principal Balance of
the related Mortgage Loan immediately prior to such Mortgage Loan becoming REO
Property minus any REO Principal Amortization received with respect thereto on
or prior to such day.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.
"Principal Remittance Amount": With respect to any
Distribution Date, the sum of (i) the Group I Principal Remittance Amount and
(ii) the Group II Principal Remittance Amount for such Distribution Date.
"Private Certificates": Any of the Class B-2, Class B-3, Class
B-4, Class N, Class X and Residual Certificates.
"Property Insurance Proceeds": Proceeds of any title policy,
hazard policy or other insurance policy covering a Mortgage Loan, to the extent
such proceeds are received by the Servicer and are not to be applied to the
restoration of the related Mortgaged Property or released to the Mortgagor in
accordance with the Servicer's servicing procedures, subject to the terms and
conditions of the related Mortgage Note and Mortgage.
"Prospectus Supplement": That certain Prospectus Supplement
dated October 28, 2004 relating to the public offering of the Offered
Certificates.
"Purchase Price": With respect to any Mortgage Loan or REO
Property to be purchased pursuant to or as contemplated by Section 2.03 or
10.01, and as confirmed by an Officers' Certificate from the Servicer to the
Trustee, an amount equal to the sum of (i) 100% of the Principal Balance thereof
as of the date of purchase (or such other price as provided in Section 10.01),
(ii) in the case of (x) a Mortgage Loan, accrued interest on such Principal
Balance at the applicable Mortgage Interest Rate in effect from time to time
from the Due Date as to which interest was last covered by a payment by the
Mortgagor or an Advance by the Servicer, which payment or Advance had as of the
date of purchase been distributed pursuant to Section 4.01 and Section 4.02,
through the end of the calendar month in which the purchase is to be effected,
and (y) an REO Property, its fair market value, determined in good faith by the
Servicer, (iii) any unreimbursed Servicing Advances and Advances and any unpaid
Servicing Fees allocable to such Mortgage Loan or REO Property, (iv) any amounts
previously withdrawn from the Collection Account in respect of such Mortgage
Loan or REO Property pursuant to Section 3.13, and (v) in the case of a Mortgage
Loan required to be purchased pursuant to Section 2.03, expenses reasonably
incurred or to be incurred by the Servicer or the Trustee in respect of the
breach or defect giving rise to the purchase obligation, including any costs and
damages incurred by the Trust Fund in connection with any violation by such loan
of any predatory or abusive lending law.
"Qualified Insurer": Any insurance company acceptable to
▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac.
- 46 -
"Rate Cap": With respect to the Group I Certificates and any
Distribution Date, a per annum rate equal to the product of (i) the average of
the Net Mortgage Interest Rates of the Group I Mortgage Loans, weighted on the
basis of the Principal Balances of the Group I Mortgage Loans as of the first
day of the related Collection Period (or, in the case of the first Distribution
Date, the Cut-off Date) and (ii) a fraction, the numerator of which is 30 and
the denominator of which is the actual number of days elapsed in the related
Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the
Uncertificated REMIC 1 Pass-Through Rate on REMIC 1 Regular Interest LT1GRP,
weighted on the basis of the Uncertificated Principal Balance of such REMIC 1
Regular Interest.
With respect to the Class AF-1 Certificates and any
Distribution Date, a per annum rate equal to the product of (i) the average of
the Net Mortgage Interest Rates of the Group II Mortgage Loans, weighted on the
basis of the Principal Balances of the Group II Mortgage Loans as of the first
day of the related Collection Period (or, in the case of the first Distribution
Date, the Cut-off Date) and (ii) a fraction, the numerator of which is 30 and
the denominator of which is the actual number of days elapsed in the related
Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the
Uncertificated REMIC 1 Pass-Through Rate on REMIC 1 Regular Interest LT2GRP,
weighted on the basis of the Uncertificated Principal Balance of such REMIC 1
Regular Interest.
With respect to the Group II Certificates (other than the
Class AF-1 Certificates) and any Distribution Date, a per annum rate equal to
the average of the Net Mortgage Interest Rates of the Group II Mortgage Loans,
weighted on the basis of the Principal Balances of the Group II Mortgage Loans
as of the first day of the related Collection Period (or, in the case of the
first Distribution Date, the Cut-off Date). For federal income tax purposes, the
economic equivalent of such rate shall be expressed as the weighted average of
the Uncertificated REMIC 1 Pass-Through Rate on REMIC 1 Regular Interest LT2SUB,
weighted on the basis of the Uncertificated Principal Balance of such REMIC 1
Regular Interest.
With respect to the Mezzanine Certificates and any
Distribution Date, a per annum rate equal to the product of (i) the average of
the Net Mortgage Interest Rates of the Mortgage Loans, weighted in proportion to
the results of subtracting from the aggregate Principal Balance of each Loan
Group the current Certificate Principal Balance of the related Class of Class A
Certificates, and (ii) a fraction, the numerator of which is 30 and the
denominator of which is the actual number of days elapsed in the related
Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the
Uncertificated REMIC 1 Pass-Through Rates on (a) REMIC 1 Regular Interest
LT1SUB, subject to a cap and a floor equal to the Expense Fee Rates of the Group
I Mortgage Loans and (b) REMIC 1 Regular Interest LT2SUB, subject to a cap and a
floor equal to the Expense Fee Rates of the Group II Mortgage Loans, weighted on
the basis of the Uncertificated Principal Balance of each such REMIC 1 Regular
Interest.
"Rating Agency or Rating Agencies": Fitch, Moody's, S&P and
DBRS, or their respective successors. If such agencies or their successors are
no longer in existence, "Rating Agencies" shall be such nationally recognized
statistical rating organizations as set forth on the
- 47 -
most current list of such organizations released by the Securities and Exchange
Commission and designated by the Depositor, notice of which designation shall be
given to the Trustee and the Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan,
the amount by which the remaining unpaid principal balance of the Mortgage Loan
exceeds the amount of Net Liquidation Proceeds applied to the principal balance
of the related Mortgage Loan.
"Realized Loss Amortization Amount": Any of the Class M-1
Realized Loss Amortization Amount, the Class M-2 Realized Loss Amortization
Amount, the Class M-3 Realized Loss Amortization Amount, the Class B-1 Realized
Loss Amortization Amount, the Class B-2 Realized Loss Amortization Amount, the
Class B-3 Realized Loss Amortization Amount and the Class B-4 Realized Loss
Amortization Amount.
"Record Date": With respect to the Floating Rate Certificates,
the Business Day immediately preceding such Distribution Date; provided,
however, that if any such Certificate becomes a Definitive Certificate, the
Record Date for such Certificate shall be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
With respect to the Fixed Rate Certificates, the Class X Certificates, the Class
N Certificates and the Residual Certificates and the first Distribution Date,
the Closing Date, and with respect to each Distribution Date following the first
Distribution Date, the last Business Day of the month immediately preceding the
month in which the related Distribution Date occurs.
"Reference Banks": Those banks (i) with an established place
of business in London, England, (ii) not controlling, under the control of or
under common control with the Depositor or the Trustee, (iii) whose quotations
appear on the Telerate Page 3750 on the relevant LIBOR Determination Date and
(iv) which have been designated as such by the Trustee; provided, however, that
if fewer than two of such banks provide a LIBOR rate, then any leading banks
selected by the Trustee which are engaged in transactions in United States
dollar deposits in the international Eurocurrency market.
"Regular Certificate": Any of the Class A Certificates, the
Mezzanine Certificates and Class X/N Certificates.
"Related Documents": With respect to any Mortgage Loan, the
related Mortgage Note, Mortgage and other documents required by Section 2.01.
"Relief Act": The Servicemembers Civil Relief Act.
"Relief Act Interest Shortfall": With respect to any
Distribution Date, for any Mortgage Loan with respect to which there has been a
reduction in the amount of interest collectible thereon for the most recently
ended Collection Period as a result of the application of the Relief Act, the
amount by which (i) interest collectible on such Mortgage Loan during such
Collection Period is less than (ii) one month's interest on the Principal
Balance of such Mortgage Loan at the Mortgage Interest Rate for such Mortgage
Loan before giving effect to the application of the Relief Act.
- 48 -
"REMIC": A "real estate mortgage investment conduit" within
the meaning of Section 860D of the Code.
"REMIC 1": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to which a REMIC election is to be made consisting of: (i) such
Mortgage Loans as from time to time are subject to this Agreement, together with
the Mortgage Files relating thereto, and together with all collections thereon
and proceeds thereof, (ii) any REO Property, together with all collections
thereon and proceeds thereof, (iii) the Trustee's rights with respect to the
Mortgage Loans under all insurance policies, required to be maintained pursuant
to this Agreement and any proceeds thereof, (iv) the Depositor's rights under
the Mortgage Loan Purchase Agreement (including any security interest created
thereby) and (v) the Collection Account, the Distribution Account (subject to
the last sentence of this definition) and any REO Account and such assets that
are deposited therein from time to time and any investments thereof, together
with any and all income, proceeds and payments with respect thereto.
Notwithstanding the foregoing, however, a REMIC election will not be made with
respect to the Net WAC Rate Carryover Reserve Account or the Cap Contracts.
"REMIC 1 Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a) the product of (i) the sum of the
aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) the Uncertificated REMIC 1 Pass-Through Rate for REMIC
1 Regular Interest LT1AA minus the Marker Rate, divided by (b) 12.
"REMIC 1 Marker Allocation Percentage": 50% of any amount
payable or loss attributable from the Mortgage Loans, which shall be allocated
to REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AV1, REMIC 1
Regular Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular
Interest LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular Interest
LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1 Regular Interest LT1AF4, REMIC
1 Regular Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular
Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1,
REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular
Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Overcollateralization Target Amount": 0.50% of the
Targeted Overcollateralization Amount.
"REMIC 1 Overcollateralized Amount": With respect to any date
of determination, (i) 0.50% of the aggregate Uncertificated Principal Balance of
the REMIC 1 Regular Interests minus (ii) the aggregate Uncertificated Principal
Balance of REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest LT1AV2A,
REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular Interest LT1AV2C, REMIC 1
Regular Interest LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC 1 Regular
Interest LT1AF3, REMIC 1 Regular Interest LT1AF4, REMIC 1 Regular Interest
LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1
Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest
LT1B2, REMIC 1 Regular Interest LT1B3 and REMIC 1 Regular Interest LT1B4, in
each case as of such date of determination.
- 49 -
"REMIC 1 Principal Loss Allocation Amount": With respect to
any Distribution Date, an amount equal to (a) the product of (i) 50% of the
aggregate Principal Balance of the Mortgage Loans and related REO Properties
then outstanding and (ii) 1 minus a fraction, the numerator of which is two
times the aggregate Uncertificated Principal Balance of REMIC 1 Regular Interest
LT1AV1, REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2B,
REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1
Regular Interest LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1 Regular
Interest LT1AF4, REMIC 1 Regular Interest LT1AF5, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1
Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest
LT1B3 and REMIC 1 Regular Interest LT1B4 and the denominator of which is the
aggregate Uncertificated Principal Balance REMIC 1 Regular Interest LT1AV1,
REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1
Regular Interest LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular
Interest LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1 Regular Interest
LT1AF4, REMIC 1 Regular Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest
LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1
Regular Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Regular Interests": Any of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a "regular interest" in REMIC I. Each REMIC I Regular Interest
shall accrue interest at the related REMIC I Remittance 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 its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto. The
following is a list of each of the REMIC I Regular Interests: REMIC 1 Regular
Interest LT1AA, REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest
LT1AV2A, REMIC 1 Regular Interest LT1AFV2B, REMIC 1 Regular Interest LT1AV2C,
REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC 1
Regular Interest LT1AF3, REMIC 1 Regular Interest LT1AF4, REMIC 1 Regular
Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular Interest LT1B4,
REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1
Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP, REMIC 1 Regular
Interest LT1XX and REMIC 1 Regular Interest LT1ZZ.
"REMIC 1 Sub WAC Allocation Percentage": 50% of any amount
payable or loss attributable from the Mortgage Loans, which shall be allocated
to REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1
Regular Interest LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1 Regular
Interest LT1XX.
"REMIC 1 Subordinated Balance Ratio": The ratio among the
Uncertificated Principal Balances of each REMIC 1 Regular Interest ending with
the designation "SUB,", equal to the ratio among, with respect to each such
REMIC 1 Regular Interest, the excess of (x) the aggregate Principal Balance of
the Mortgage Loans in the related Loan Group over (y) the current aggregate
Certificate Principal Balance of the Class A Certificates in the related Loan
Group.
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"REMIC 2": The segregated pool of assets consisting of all of
the REMIC 1 Regular Interests conveyed in trust to the Trustee, for the benefit
of the Holders of the regular interests and the Class R Certificate (in respect
of the Class R-2 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC 2 Regular Interests": The Class B-2 Interest, the Class
B-3 Interest, the Class B-4 Interest and the Class X/N Interest.
"REMIC 3": The segregated pool of assets consisting of the
Class B-2 Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class B-2 Certificates and the Class R-X Certificate (in respect
of the Class R-3 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC 4": The segregated pool of assets consisting of the
Class B-3 Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class B-3 Certificates and the Class R-X Certificate (in respect
of the Class R-4 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC 5": The segregated pool of assets consisting of the
Class B-4 Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class B-4 Certificates and the Class R-X Certificate (in respect
of the Class R-5 Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC 6": The segregated pool of assets consisting of the
Class X/N Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Class N Certificates and the Class X Certificates and the Class
R-X Certificate (in respect of the Class R-6 Interest), pursuant to Article II
hereunder, and all amounts deposited therein, with respect to which a separate
REMIC election is to be made.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits which appear at Section
860A through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions, and regulations and rulings promulgated thereunder, as the foregoing
may be in effect from time to time.
"REMIC Regular Interests": The REMIC 1 Regular Interests and
the REMIC 2 Regular Interests.
"Remittance Report": A report prepared by the Servicer and
delivered to the Trustee pursuant to Section 4.07, containing the information
attached hereto as Exhibit M.
"Rents from Real Property": With respect to any REO Property,
gross income of the character described in Section 856(d) of the Code.
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"REO Disposition": The sale or other disposition of an REO
Property on behalf of the Trust Fund.
"REO Principal Amortization": With respect to any REO
Property, for any calendar month, the aggregate of all amounts received in
respect of such REO Property during such calendar month, whether in the form of
rental income, sale proceeds (including, without limitation, that portion of the
Termination Price paid in connection with a purchase of all of the Mortgage
Loans and REO Properties pursuant to Section 10.01 that is allocable to such REO
Property) or otherwise, net of any portion of such amounts (i) payable pursuant
to Section 3.13 in respect of the proper operation, management and maintenance
of such REO Property or (ii) payable or reimbursable to the Servicer pursuant to
Section 3.13 for unpaid Servicing Fees in respect of the related Mortgage Loan
and unreimbursed Servicing Advances and Advances in respect of such REO Property
or the related Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Servicer
on behalf of the Trust Fund through foreclosure or deed-in-lieu of foreclosure,
as described in Section 3.13.
"Request for Release": A release signed by a Servicing
Officer, in the form of Exhibit E attached hereto.
"Residential Dwelling": Any one of the following: (i) a
one-family dwelling, (ii) a two- to four-family dwelling, (iii) a one-family
dwelling unit in a ▇▇▇▇▇▇ ▇▇▇ eligible condominium project, (iv) a one-family
dwelling in a planned unit development, which is not a co-operative, or (v) a
mobile or manufactured home (as defined in ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, Section
5402(6)).
"Residual Certificates": The Class R Certificates and the
Class R-X Certificates.
"Residual Interest": The sole Class of "residual interests" in
each REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": Any officer assigned to the Corporate
Trust Division (or any successor thereto) of the Trustee, including any Vice
President, Assistant Vice President, Trust Officer, any Assistant Secretary, any
trust officer or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
in each case having direct responsibility for the administration of this
Agreement.
"S&P": Standard & Poor's, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc., and its successors, and if such company shall for any reason no
longer perform the functions of a securities rating agency, "S&P" shall be
deemed to refer to any other "nationally recognized statistical rating
organization" as set forth on the most current list of such organizations
released by the Securities and Exchange Commission.
"Seller": Credit-Based Asset Servicing and Securitization LLC,
or its successor in interest, in its capacity as seller under the Mortgage Loan
Purchase Agreement.
"Senior Enhancement Percentage": For any Distribution Date,
the percentage obtained by dividing (x) the sum of (i) the aggregate Certificate
Principal Balance of the
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Mezzanine Certificates and (ii) the Overcollateralization Amount, in each case
before taking into account the distribution of the Principal Remittance Amount
and the Extra Principal Distribution Amount on such Distribution Date by (y) the
Pool Balance as of the last day of the related Collection Period.
"Senior Principal Distribution Amount": As of any Distribution
Date on or after the Stepdown Date and as long as a Trigger Event is not in
effect, the excess of (x) the aggregate Certificate Principal Balance of the
Class A Certificates immediately prior to such Distribution Date over (y) the
lesser of (A) the product of (i) 61.00% and (ii) the Principal Balance of the
Mortgage Loans as of the last day of the related Collection Period and (B) the
Principal Balance of the Mortgage Loans as of the last day of the related
Collection Period minus the product of (i) 0.50% and (ii) the Principal Balance
of the Mortgage Loans on the Cut-off Date, but in no event less than zero. Any
distribution of the Group I Senior Principal Distribution Amount or the Group II
Senior Principal Distribution Amount to the Holders of the related Class of
Class A Certificates will be deemed to also be a distribution in respect of the
Senior Principal Distribution Amount but in no event will the Senior Principal
Distribution Amount be less than the sum of the Group I Senior Principal
Distribution Amount and the Group II Senior Principal Distribution Amount.
"Servicer": ▇▇▇▇▇▇ Loan Servicing LP, a Delaware limited
partnership, or any successor servicer appointed as herein provided, in its
capacity as Servicer hereunder.
"Servicer Affiliate": A Person (i) controlling, controlled by
or under common control with the Servicer or which is 50% or more owned by the
Servicer and (ii) which is qualified to service residential mortgage loans.
"Servicer Event of Termination": One or more of the events
described in Section 7.01.
"Servicer Remittance Date": With respect to any Distribution
Date, one Business Day prior to such Distribution Date.
"Servicing Advances": All customary, reasonable and necessary
"out of pocket" costs and expenses incurred by the Servicer in the performance
of its servicing obligations, including, but not limited to, the cost of (i) the
preservation, restoration and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property, (iv) compliance with the
obligations under Section 3.08 and (v) rebating any points and fees that are to
be reimbursed to a Mortgagor due to a Principal Prepayment.
"Servicing Fee": With respect to each Mortgage Loan (including
each REO Property) and for any calendar month, an amount equal to one month's
interest (or in the event of any payment of interest which accompanies a
Principal Prepayment in full made by the Mortgagor during such calendar month,
interest for the number of days covered by such payment of interest) at the
Servicing Fee Rate on the same principal amount on which interest on such
Mortgage Loan accrues for such calendar month.
"Servicing Fee Rate": With respect to each Mortgage Loan,
0.50% per annum.
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"Servicing Officer": Any officer of the Servicer involved in,
or responsible for, the administration and servicing of Mortgage Loans, whose
name and specimen signature appear on a list of servicing officers furnished by
the Servicer to the Trustee and the Depositor on the Closing Date, as such list
may from time to time be amended.
"Servicing Rights Pledgee": One or more lenders, selected by
the Servicer, to which the Servicer may pledge and assign all of its right,
title and interest in, to and under this Agreement, including Wachovia Bank,
National Association as the representative of certain lenders.
"Servicing Standard": Shall mean the standards set forth in
Section 3.01.
"Special Hazard Losses": Realized Losses that result from
direct physical damage to Mortgaged Properties caused by natural disasters and
other hazards (i) which are not covered by hazard insurance policies (such as
earthquakes) and (ii) for which claims have been submitted and rejected by the
related hazard insurer and any shortfall in insurance proceeds for partial
damage due to the application of the co-insurance clauses contained in hazard
insurance policies.
"Startup Day": As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the
terms of the Certificates and this Agreement but which is not remitted by the
Servicer because the Servicer is the subject of a proceeding under the
Bankruptcy Code and the making of such remittance is prohibited by Section 362
of the Bankruptcy Code.
"Stepdown Date": The earlier to occur of (x) the Distribution
Date on which the aggregate Certificate Principal Balance of the Class A
Certificates is zero and (y) the later to occur of (A) the Distribution Date in
November 2007 and (B) the first Distribution Date on which the Senior
Enhancement Percentage is greater than or equal to 39.00%.
"Subordinate Principal Distribution Amount": The Class M-1
Principal Distribution Amount, Class M-2 Principal Distribution Amount, Class
M-3 Principal Distribution Amount, Class B-1 Principal Distribution Amount,
Class B-2 Principal Distribution Amount, Class B-3 Principal Distribution Amount
or Class B-4 Principal Distribution Amount, as applicable
"Subsequent Recoveries": As of any Distribution Date, amounts
received by the Servicer (net of any expenses permitted to be reimbursed
pursuant to Section 3.05) or surplus amounts held by the Servicer to cover
estimated expenses (including, but not limited to, recoveries in respect of the
representations and warranties made by the Seller pursuant to the Mortgage Loan
Purchase Agreement) specifically related to a Mortgage Loan that was the subject
of a Final Recover Determination or an REO Disposition prior to the related
Prepayment Period that resulted in a Realized Loss.
"Substitution Adjustment Amount": As defined in Section
2.03(d) hereof.
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"Targeted Overcollateralization Amount": As of any
Distribution Date, (x) prior to the Stepdown Date, 2.80% of the aggregate
Cut-off Date Principal Balance of the Mortgage Loans, (y) on and after the
Stepdown Date provided that a Trigger Event is not in effect, the lesser of (i)
2.80% of the aggregate Cut-off Date Principal Balance of the Mortgage Loans and
(ii) the greater of (A) 5.60% of the Pool Balance as of the last day of the
related Collection Period and (B) 0.50% of the aggregate Cut-off Date Principal
Balance of the Mortgage Loans and (z) on or after the Stepdown Date and if a
Trigger Event is in effect, the Targeted Overcollateralization Amount for the
immediately preceding Distribution Date.
"Tax Matters Person": The tax matters person appointed
pursuant to Section 9.01(e) hereof.
"Tax Returns": The federal income tax returns on Internal
Revenue Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income
Tax Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any successor
forms, to be filed on behalf of the Trust for each of the eight REMICs created
pursuant to this Agreement under the REMIC Provisions, together with any and all
other information reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.
"Telerate Page 3750": The display page currently so designated
on the Bridge Telerate Service (or such other page as may replace the Telerate
Page 3750 page on that service for the purpose of displaying London interbank
offered rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
"Trigger Event": With respect to any Distribution Date a
Trigger Event is in effect, if (i) the three-month rolling average of 60+ Day
Delinquent Loans (divided by the aggregate Principal Balance of the Mortgage
Loans as of the last day of the previous calendar month) equals or exceeds
43.00% of the Senior Enhancement Percentage or (ii) the aggregate amount of
Realized Losses incurred since the Cut-off Date through the last day of the
related Collection Period (reduced by the amount of Subsequent Recoveries
received since the Cut-off Date through the last day of the related Collection
Period) divided by the initial Pool Balance exceeds the applicable percentages
set forth below with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
------------------------------ ----------
November 2006 through October 2007 2.00%
November 2007 through October 2008 3.00%
November 2008 through October 2009 4.75%
November 2009 through October 2010 6.25%
November 2010 and thereafter 7.25%
"Trust": 2004-CB7 Trust, the trust created hereunder.
"Trust Fund": All of the assets of the Trust, which is the
trust created hereunder consisting of REMIC 1, REMIC 2, REMIC 3, REMIC 4, REMIC
5, REMIC 6, the CAP Contracts and the Net WAC Rate Carryover Reserve Account.
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"Trustee": U.S. Bank National Association, a national banking
association, or any successor Trustee appointed as herein provided.
"Trustee Fee": With respect to any Distribution Date, the
product of (x) one twelfth of the Trustee Fee Rate and (y) the aggregate of the
Principal Balances of all Mortgage Loans as of the opening of business on the
first day of the related Collection Period.
"Trustee Fee Rate": With respect to any Distribution Date,
0.006% per annum.
"Uncertificated Accrued Interest": With respect to each REMIC
Regular Interest on each Distribution Date, an amount equal to one month's
interest at the related Uncertificated Pass-Through Rate on the Uncertificated
Principal Balance of such REMIC Regular Interest. In each case, Uncertificated
Accrued Interest will be reduced by any Prepayment Interest Shortfalls and
Relief Act Interest Shortfalls (allocated to such REMIC Regular Interests based
on their respective entitlements to interest irrespective of any Prepayment
Interest Shortfalls and Relief Act Interest Shortfalls for such Distribution
Date).
"Uncertificated Principal Balance": With respect to each REMIC
Regular Interest, the amount of such REMIC Regular Interest outstanding as of
any date of determination. As of the Closing Date, the Uncertificated Principal
Balance of each REMIC Regular Interest shall equal the amount set forth in the
Preliminary Statement hereto as its initial Uncertificated Principal Balance. On
each Distribution Date, the Uncertificated Principal Balance of each REMIC
Regular Interest shall be reduced by all distributions of principal made on such
REMIC Regular Interest on such Distribution Date pursuant to Section 4.03 and,
if and to the extent necessary and appropriate, shall be further reduced on such
Distribution Date by Realized Losses as provided in Section 4.03, and the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1ZZ shall be
increased by interest deferrals as provided in Section 4.03. The Uncertificated
Principal Balance of each REMIC Regular Interest that has an Uncertificated
Principal Balance shall never be less than zero.
"Uncertificated REMIC 1 Pass-Through Rate": With respect to
REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular
Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular Interest
LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC
1 Regular Interest LT1AF3, REMIC 1 Regular Interest LT1AF4, REMIC 1 Regular
Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular Interest LT1M2,
REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest LT1B1, REMIC 1 Regular
Interest LT1B2, REMIC 1 Regular Interest LT1B3, REMIC 1 Regular Interest LT1B4,
REMIC 1 Regular Interest LT1ZZ, REMIC 1 Regular Interest LT1SUB, REMIC 1 Regular
Interest LT2SUB and REMIC 1 Regular Interest LT1XX, the weighted average of the
Net Mortgage Interest Rates of the Mortgage Loans. With respect to REMIC 1
Regular Interest LT1GRP, the weighted average of the Net Mortgage Interest Rates
of the Group I Mortgage Loans. With respect REMIC 1 Regular Interest LT2GRP, the
weighted average of the Net Mortgage Interest Rates of the Group II Mortgage
Loans.
"Underwriters": Citigroup Global Markets Inc. and Greenwich
Capital Markets, Inc., as underwriters with respect to the Offered Certificates.
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"United States Person" or "U.S. Person": (i) A citizen or
resident of the United States, (ii) a corporation, partnership or other entity
treated as a corporation or partnership for United States federal income tax
purposes organized in or under the laws of the United States or any state
thereof or the District of Columbia (unless, in the case of a partnership,
Treasury regulations provide otherwise) or (iii) an estate the income of which
is includible in gross income for United States tax purposes, regardless of its
source, or (iv) a trust if a court within the United States is able to exercise
primary supervision over the administration of the trust and one or more United
States persons have authority to control all substantial decisions of the trust.
Notwithstanding the preceding sentence, to the extent provided in Treasury
regulations, certain Trusts in existence on August 20, 1996, and treated as
United States persons prior to such date, that elect to continue to be treated
as United States persons will also be a U.S. Person.
"Unpaid Realized Loss Amount": For any Class of Class A
Certificate or Mezzanine Certificate and as to any Distribution Date, the excess
of (x) the aggregate Applied Realized Loss Amounts applied with respect to such
Class for all prior Distribution Dates over (y) the aggregate Realized Loss
Amortization Amounts with respect to such Class for all prior Distribution Dates
and reduced by the amount of the increase in the related Certificate Principal
Balance due to the receipt of Subsequent Recoveries as provided in Section 4.02.
"Value": With respect to any Mortgaged Property, the value
thereof as determined by an independent appraisal made at the time of the
origination of the related Mortgage Loan or the sale price, if the appraisal is
not available; except that, with respect to any Mortgage Loan that is a purchase
money mortgage loan, the lesser of (i) the value thereof as determined by an
independent appraisal made at the time of the origination of such Mortgage Loan,
if any, and (ii) the sales price of the related Mortgaged Property.
"Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any Certificate. The Voting Rights
allocated among Holders of the Offered Certificates and the Mezzanine
Certificates shall be 98%, and shall be allocated among each such Class
according to the fraction, expressed as a percentage, the numerator of which is
the aggregate Certificate Principal Balance of all the Certificates of such
Class then outstanding and the denominator of which is the aggregate Certificate
Principal Balance of all the Class A Certificates and the Mezzanine Certificates
then outstanding. The Voting Rights allocated to each such Class of Certificates
shall be allocated among all holders of each such Class in proportion to the
outstanding Certificate Principal Balance of such Certificates; provided,
however, that any Certificate registered in the name of the Servicer, the
Depositor, the Trustee or any of its respective affiliates shall not be included
in the calculation of Voting Rights; provided that only such Certificates as are
known by a Responsible Officer of the Trustee to be so registered will be so
excluded. The percentage of all the Voting Rights allocated among the Holders of
the Class X Certificate shall be 2%. The Class N and Residual Certificates shall
have no Voting Rights.
"Written Order to Authenticate": A written order by which the
Depositor directs the Trustee to execute, authenticate and deliver the
Certificates.
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Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any
definition or calculation, whenever amounts are required to be netted,
subtracted or added or any distributions are taken into account such definition
or calculation and any related definitions or calculations shall be determined
without duplication of such functions.
Section 1.03 Allocation of Certain Interest Shortfalls.
For purposes of calculating the amount of the Accrued
Certificate Interest for the Class A Certificates, the Mezzanine Certificates
and the Class X/N Interest for any Distribution Date, (1) the aggregate amount
of any Prepayment Interest Shortfalls and any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, among the Class X/N Interest on a PRO RATA basis based on, and
to the extent of, one month's interest at the then applicable Pass-Through Rate
on the Notional Amount thereof and, thereafter, among the Class A Certificates
and the Mezzanine Certificates on a PRO RATA basis based on, and to the extent
of, one month's interest at the then applicable respective Pass-Through Rate on
the respective Certificate Principal Balance of each such Certificate and (2)
the aggregate amount of any Realized Losses and Net WAC Rate Carryover Amounts
incurred for any Distribution Date shall be allocated among the Class X/N
Interest on a PRO RATA basis based on, and to the extent of, one month's
interest at the then applicable Pass-Through Rate on the Notional Amount
thereof.
For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC 1 Regular Interests for any Distribution Date:
(A) the REMIC 1 Marker Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls and the REMIC 1 Marker Allocation
Percentage of the aggregate amount of any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated among REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LTAV1,
REMIC 1 Regular Interest LTAV2A, REMIC 1 Regular Interest LTAV2B, REMIC 1
Regular Interest LTAV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular
Interest LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1 Regular Interest
LT1AF4, REMIC 1 Regular Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1
Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest
LT1B1, REMIC 1 Regular Interest LTB2, REMIC 1 Regular Interest LT1B3, REMIC 1
Regular Interest LTB4 and REMIC I Regular Interest LT1ZZ PRO RATA based on, and
to the extent of, one month's interest at the then applicable respective
Uncertificated REMIC 1 Pass-Through Rate on the respective Uncertificated
Principal Balance of each such REMIC 1 Regular Interest; and
(B) the REMIC I Sub WAC Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls and the REMIC I Sub WAC Allocation
of the aggregate amount of any Percentage Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall be
allocated first, to Uncertificated Accrued Interest payable to REMIC 1 Regular
Interest LT1SUB, REMIC 1 Regular Interest LT1GRP, REMIC 1 Regular Interest
LT2SUB, REMIC 1 Regular Interest LT2GRP and REMIC 1 Regular Interest LT1XX, PRO
RATA based on, and to the extent of, one month's interest at the then
- 58 -
applicable respective Uncertificated REMIC 1 Pass-Through Rate on the respective
Uncertificated Principal Balance of each such REMIC 1 Regular Interest.
For purposes of calculating the amount of Uncertificated
Accrued Interest for the REMIC 1 Regular Interests for any Distribution Date,
the aggregate amount of any Prepayment Interest Shortfalls and any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated to the Class B-2 Interest to the extent
allocated to the Class B-2 Certificates, to the Class B-3 Interest to the extent
allocated to the Class B-3 Certificates, to the Class B-4 Interest to the extent
allocated to the Class B-4 Certificates and to the Class X/N Certificates to the
extent allocated to the Class X/N Interest.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey to the
Trustee, on behalf of the Trust, without recourse for the benefit of the
Certificateholders all the right, title and interest of the Depositor, including
any security interest therein for the benefit of the Depositor, in and to (i)
each Mortgage Loan identified on the Mortgage Loan Schedule, including the
related Cut-off Date Principal Balance, all interest accruing thereon after the
Cut-off Date and all collections in respect of interest and principal due after
the Cut-off Date; (ii) property which secured each such Mortgage Loan and which
has been acquired by foreclosure or deed in lieu of foreclosure; (iii) its
interest in any insurance policies in respect of the Mortgage Loans; (iv) all
proceeds of any of the foregoing; (v) the rights of the Depositor under the
Mortgage Loan Purchase Agreement and (vi) all other assets included or to be
included in the Trust Fund; provided, however, so long as the Servicer is an FHA
Approved Mortgagee, the Commissioner of HUD shall have no obligation to
recognize or deal with any person other than the Servicer with respect to FHA
Insurance. Such assignment includes all interest and principal due to the
Depositor or the Servicer after the Cut off Date with respect to the Mortgage
Loans.
In connection with such transfer and assignment, the Seller,
on behalf of the Depositor, does hereby deliver or cause to be delivered to, and
deposit with the Trustee, or its designated agent (the "Custodian"), the
following documents or instruments with respect to each Mortgage Loan (a
"Mortgage File") so transferred and assigned:
(i) the original Mortgage Note, endorsed either (A) in blank or
(B) in the following form: "Pay to the order of U.S. Bank
National Association, as Trustee--C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB7, without recourse,"
or with respect to any lost Mortgage Note, an original Lost
Note Affidavit, together with a copy of the related Mortgage
Note;
(ii) the original Mortgage with evidence of recording thereon, and
the original recorded power of attorney, if the Mortgage was
executed pursuant to a power of attorney, with evidence of
recording thereon or, if such Mortgage or power of attorney
has been submitted for recording but has not been returned
from the applicable public recording office, has been lost or
is not otherwise available, a copy of such Mortgage or power
of attorney, as the case may be, certified to be a true and
complete copy of the original submitted for recording;
(iii) an original Assignment of Mortgage, in form and substance
acceptable for recording. The Mortgage shall be assigned
either (A) in blank or (B) to "U.S. Bank National Association,
as Trustee as Trustee--C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB7, without recourse";
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(iv) an original or a certified copy of any intervening assignment
of Mortgage showing a complete chain of assignments;
(v) the original or a certified copy of lender's title insurance
policy;
(vi) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(vii) for each FHA Loan, the original Mortgage Insurance
Certificate.
If any of the documents referred to in Section 2.01(ii), (iii)
or (iv) above has as of the Closing Date been submitted for recording but either
(x) has not been returned from the applicable public recording office or (y) has
been lost or such public recording office has retained the original of such
document, the obligations of the Seller to deliver such documents shall be
deemed to be satisfied upon (1) delivery to the Trustee or the Custodian no
later than the Closing Date, of a copy of each such document certified by the
Seller in the case of (x) above or the applicable public recording office in the
case of (y) above to be a true and complete copy of the original that was
submitted for recording and (2) if such copy is certified by the Seller,
delivery to the Trustee or the Custodian, promptly upon receipt thereof of
either the original or a copy of such document certified by the applicable
public recording office to be a true and complete copy of the original. The
Seller shall deliver or cause to be delivered to the Trustee or the Custodian
promptly upon receipt thereof any other documents constituting a part of a
Mortgage File received with respect to any Mortgage Loan, including, but not
limited to, any original documents evidencing an assumption or modification of
any Mortgage Loan.
Upon discovery or receipt of notice of any materially
defective document in, or that a document is missing from, a Mortgage File, the
Seller shall have 120 days to cure such defect or 150 days following the Closing
Date, in the case of missing Mortgages or Assignments or deliver such missing
document to the Trustee or the Custodian. If the Seller does not cure such
defect or deliver such missing document within such time period, the Seller
shall either repurchase or substitute for such Mortgage Loan in accordance with
Section 2.03.
The Servicer shall cause the Assignments of Mortgage which
were delivered in blank to be completed and shall cause all Assignments referred
to in Section 2.01(iii) hereof and, to the extent necessary, in Section 2.01(iv)
hereof to be recorded. The Servicer shall be required to deliver such
assignments for recording within 30 days of the Closing Date. The Servicer shall
furnish the Trustee, or its designated agent, with a copy of each Assignment of
Mortgage submitted for recording. In the event that any such Assignment is lost
or returned unrecorded because of a defect therein, the Servicer shall promptly
have a substitute Assignment prepared or have such defect cured, as the case may
be, and thereafter cause each such Assignment to be duly recorded.
In the event that any Assignments of Mortgage are not recorded
or are improperly recorded, the Servicer shall have no liability for its failure
to receive or act on notices not received related to such Assignment of
Mortgage.
In the event that any Mortgage Note is endorsed in blank as of
the Closing Date, promptly following the Closing Date the Servicer shall cause
to be completed such endorsements
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in the following form: "Pay to the order of U.S. Bank National Association, as
Trustee--C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB7,
without recourse."
The Depositor herewith delivers to the Trustee executed copies
of the Mortgage Loan Purchase Agreement.
The parties hereto understand and agree that it is not
intended that any Mortgage Loan be included in the Trust that is a "High-Cost
Home Loan" as defined by the Homeownership and Equity Protection Act of 1994 or
any other applicable predatory or abusive lending laws.
Section 2.02 Acceptance by the Trustee.
The Trustee acknowledges the receipt of, subject to the
provisions of Section 2.01 and subject to the review described below and any
exceptions noted on the exception report described in the next paragraph below,
the documents referred to in Section 2.01 above and all other assets included in
the definition of "Trust Fund" and declares that it holds and will hold such
documents and the other documents delivered to it constituting a Mortgage File,
and that it holds or will hold all such assets and such other assets included in
the definition of "Trust Fund" in trust for the exclusive use and benefit of all
present and future Certificateholders.
The Trustee agrees to execute and deliver (or cause the
Custodian to execute and deliver) to the Depositor on or prior to the Closing
Date an acknowledgment of receipt of the original Mortgage Note (with any
exceptions noted), substantially in the form attached as Exhibit F-3 hereto.
The Trustee agrees, for the benefit of the Certificateholders,
to review (or cause the Custodian to review) each Mortgage File within 60 days
after the Closing Date (or, with respect to any document delivered after the
Startup Day, within 60 days of receipt and with respect to any Qualified
Substitute Mortgage, within 60 days after the assignment thereof) and to certify
(or cause the Custodian to certify) in substantially the form attached hereto as
Exhibit F-1 that, as to each Mortgage Loan listed in the Mortgage Loan Schedule
(other than any Mortgage Loan paid in full or any Mortgage Loan specifically
identified in the exception report annexed thereto as not being covered by such
certification), (i) all documents required to be delivered to it pursuant to
Section 2.01 of this Agreement are in its possession, (ii) such documents have
been reviewed by it and have not been mutilated, damaged or torn and relate to
such Mortgage Loan, (iii) based on its examination and only as to the foregoing,
the information set forth in the Mortgage Loan Schedule that corresponds to
items (1), (2), (3), (5) (13) and (26) (but only as to whether the Mortgage Loan
as a Prepayment Charge) of the Mortgage Loan Schedule accurately reflects
information set forth in the Mortgage File, (iv) all Assignments of Mortgage or
intervening assignments of mortgage, as applicable, have been submitted for
recording and (v) each Mortgage Note has been endorsed as provided in Section
2.01(i) of this Agreement and each Mortgage has been assigned in accordance with
Section 2.01(iii) of this Agreement. It is herein acknowledged that, in
conducting such review, the Trustee (or the Custodian, as applicable) is under
no duty or obligation to inspect, review or examine any such documents,
instruments, certificates or other papers to determine that they are genuine,
enforceable, or
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appropriate for the represented purpose or that they have actually been recorded
or that they are other than what they purport to be on their face.
Prior to the first anniversary date of this Agreement the
Trustee shall deliver (or cause the Custodian to deliver) to the Depositor and
the Servicer a final certification in the form annexed hereto as Exhibit F-2
evidencing the completeness of the Mortgage Files, with any applicable
exceptions noted thereon.
If in the process of reviewing the Mortgage Files and making
or preparing, as the case may be, the certifications referred to above, the
Trustee (or the Custodian, as applicable) finds any document or documents
constituting a part of a Mortgage File to be missing or defective in any
material respect, at the conclusion of its review the Trustee, upon its
notification by the Custodian, if applicable, shall so notify the Seller, the
Depositor and the Servicer. In addition, upon the discovery by the Seller,
Depositor, the Trustee or the Servicer (or upon receipt by the Trustee of
written notification of such breach) of a breach of any of the representations
and warranties made by the Seller in the related Mortgage Loan Purchase
Agreement in respect of any Mortgage Loan which materially adversely affects
such Mortgage Loan or the interests of the related Certificateholders in such
Mortgage Loan, the party discovering such breach shall give prompt written
notice to the other parties.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a sale of the Mortgage Loans and the
Related Documents, conveying good title thereto free and clear of any liens and
encumbrances, from the Depositor to the Trustee and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee, on behalf
of the Trust, a first priority perfected security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans and the
Related Documents, and that this Agreement shall constitute a security agreement
under applicable law.
Section 2.03 Repurchase or Substitution of Mortgage Loans by
the Seller.
(a) Upon discovery or receipt of written notice of any
materially defective document in, or that a document is missing from, a Mortgage
File or of the breach by the Seller of any representation, warranty or covenant
under the Mortgage Loan Purchase Agreement or in Section 2.04 in respect of any
Mortgage Loan which materially adversely affects the value of such Mortgage Loan
or the interest therein of the Certificateholders, the Trustee (or the
Custodian, as applicable) shall promptly notify the Seller and the Servicer of
such defect, missing document or breach and request that the Seller deliver such
missing document or cure such defect or breach within 120 days or 150 days
following the Closing Date, in the case of missing Mortgages or Assignments from
the date the Seller was notified of such missing document, defect or breach, and
if the Seller does not deliver such missing document or cure such defect or
breach in all material respects during such period, the Trustee shall enforce
the Seller's obligation under the Mortgage Loan Purchase Agreement and inform
the Seller of its obligation to repurchase such Mortgage Loan from the Trust
Fund at the Purchase Price on or prior to the Determination Date following the
expiration of such 120 day period (subject to
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Section 2.03(e)); provided that, in connection with any such breach that could
not reasonably have been cured within such 120 day or 150 day period, if the
Seller shall have commenced to cure such breach within such 120 day or 150 day
period, the Seller shall be permitted to proceed thereafter diligently and
expeditiously to cure the same within the additional period provided under the
Mortgage Loan Purchase Agreement. The Purchase Price for the repurchased
Mortgage Loan shall be deposited in the Collection Account, and the Trustee,
upon receipt of written certification from the Servicer of such deposit, shall
release to the Seller the related Mortgage File and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse,
representation or warranty, as the Seller shall furnish to it and as shall be
necessary to vest in the Seller any Mortgage Loan released pursuant hereto and
the Trustee shall have no further responsibility with regard to such Mortgage
File. In lieu of repurchasing any such Mortgage Loan as provided above, the
Seller may cause such Mortgage Loan to be removed from the Trust Fund (in which
case it shall become a Defective Mortgage Loan) and substitute one or more
Eligible Substitute Mortgage Loans in the manner and subject to the limitations
set forth in Section 2.03(d). It is understood and agreed that the obligation of
the Seller to cure or to repurchase (or to substitute for) any Mortgage Loan as
to which a document is missing, a material defect in a constituent document
exists or as to which such a breach has occurred and is continuing shall
constitute the sole remedy against the Seller respecting such omission, defect
or breach available to the Trustee on behalf of the Certificateholders.
(b) [Reserved].
(c) Within 90 days of the earlier of discovery by the Servicer
or receipt of notice by the Servicer of the breach of any representation,
warranty or covenant of the Servicer set forth in Section 2.05 which materially
and adversely affects the interests of the Certificateholders in any Mortgage
Loan, the Servicer shall cure such breach in all material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the last Business Day that is within two years after the Closing Date. As to
any Defective Mortgage Loan for which the Seller substitutes an Eligible
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Seller delivering to the Trustee, for such Eligible Substitute Mortgage Loan or
Loans, the Mortgage Note, the Mortgage, the Assignment to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon, as are
required by Section 2.01, together with an Officers' Certificate providing that
each such Eligible Substitute Mortgage Loan satisfies the definition thereof and
specifying the Substitution Adjustment Amount (as described below), if any, in
connection with such substitution. The Trustee shall acknowledge receipt for
such Eligible Substitute Mortgage Loan or Loans and, within ten Business Days
thereafter, shall review such documents as specified in Section 2.02 and deliver
(or cause the Custodian to deliver) to the Servicer, with respect to such
Eligible Substitute Mortgage Loan or Loans, a certification substantially in the
form attached hereto as Exhibit F-1, with any applicable exceptions noted
thereon. Within one year of the date of substitution, the Trustee shall deliver
(or cause the Custodian to deliver) to the Servicer a certification
substantially in the form of Exhibit F-2 hereto with respect to such Eligible
Substitute Mortgage Loan or Loans, with any applicable exceptions noted thereon.
Monthly Payments due with respect to Eligible Substitute Mortgage Loans in the
month of substitution are not part of the Trust Fund and will be
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retained by the Seller. For the month of substitution, distributions to
Certificateholders will reflect the collections and recoveries in respect of
such Defective Mortgage Loan in the Collection Period preceding the month of
substitution and the Depositor or the Seller, as the case may be, shall
thereafter be entitled to retain all amounts subsequently received in respect of
such Defective Mortgage Loan. The Seller shall give or cause to be given written
notice to the Certificateholders that such substitution has taken place, shall
amend the Mortgage Loan Schedule to reflect the removal of such Defective
Mortgage Loan from the terms of this Agreement and the substitution of the
Eligible Substitute Mortgage Loan or Loans and shall deliver a copy of such
amended Mortgage Loan Schedule to the Trustee and the Custodian. Upon such
substitution, such Eligible Substitute Mortgage Loan or Loans shall constitute
part of the Mortgage Pool and shall be subject in all respects to the terms of
this Agreement and, in the case of a substitution effected by the Seller, the
Mortgage Loan Purchase Agreement, including, in the case of a substitution
effected by the Seller all applicable representations and warranties thereof
included in the Mortgage Loan Purchase Agreement and all applicable
representations and warranties thereof set forth in Section 2.04, in each case
as of the date of substitution.
For any month in which the Seller substitutes one or more
Eligible Substitute Mortgage Loans for one or more Defective Mortgage Loans, the
Servicer will determine the amount (the "Substitution Adjustment Amount"), if
any, by which the aggregate Purchase Price of all such Defective Mortgage Loans
exceeds the aggregate, as to each such Eligible Substitute Mortgage Loan, of the
principal balance thereof as of the date of substitution, together with one
month's interest on such principal balance at the applicable Net Mortgage
Interest Rate. On the date of such substitution, the Seller will deliver or
cause to be delivered to the Servicer for deposit in the Collection Account an
amount equal to the Substitution Adjustment Amount, if any, and the Trustee,
upon receipt of the related Eligible Substitute Mortgage Loan or Loans and
certification by the Servicer of such deposit, shall release to the Seller the
related Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, representation or
warranty, as the Seller shall deliver to it and as shall be necessary to vest
therein any Defective Mortgage Loan released pursuant hereto.
In addition, the Seller shall obtain at its own expense and
deliver to the Trustee an Opinion of Counsel to the effect that such
substitution will not cause (a) any federal tax to be imposed on the Trust Fund,
including without limitation, any federal tax imposed on "prohibited
transactions" under Section 860F(a)(l) of the Code or on "contributions after
the startup date" under Section 860G(d)(l) of the Code, or (b) any REMIC to fail
to qualify as a REMIC at any time that any Certificate is outstanding. If such
Opinion of Counsel can not be delivered, then such substitution may only be
effected at such time as the required Opinion of Counsel can be given.
(e) Upon discovery by the Seller, the Servicer or the Trustee
that any Mortgage Loan does not constitute a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code, the party discovering such fact shall
within two Business Days give written notice thereof to the other parties. In
connection therewith, the Seller shall repurchase or, subject to the limitations
set forth in Section 2.03(d), substitute one or more Eligible Substitute
Mortgage Loans for the affected Mortgage Loan within 90 days of the earlier of
discovery or receipt of such notice with respect to such affected Mortgage Loan.
In addition, upon discovery that a Mortgage Loan is defective in a manner that
would cause it to be a "defective obligation"
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within the meaning of Treasury regulations relating to REMICs, the Seller shall
cure the defect or make the required purchase or substitution no later than 90
days after the discovery of the defect. Any such repurchase or substitution
shall be made in the same manner as set forth in Section 2.03(a), if made by the
Seller. The Trustee shall reconvey to the Seller the Mortgage Loan to be
released pursuant hereto in the same manner, and on the same terms and
conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
Notwithstanding anything to the contrary contained herein, the
parties hereto acknowledge that the functions of the Trustee with respect to the
custody, acceptance, inspection and release of the Mortgage Files pursuant to
Sections 2.01, 2.02 and 2.03 and preparation and delivery of the certifications
in the form of Exhibit F-1, Exhibit F-2 and Exhibit F-3 shall be performed by
the Custodian pursuant to the terms and conditions of the Custodial Agreement.
The fees and expenses of the Custodian shall be paid by the Servicer.
Section 2.04 Representations and Warranties of the Seller with
Respect to the Mortgage Loans.
The Seller hereby represents and warrants to the Trustee for
the benefit of the Certificateholders and the Depositor that as of the Closing
Date or as of such other date specifically provided herein:
(a) The representations and warranties made by the Seller
pursuant to Section 3.01 of the Mortgage Loan Purchase Agreement are hereby
being made to the Trustee and are true and correct as of the Closing Date.
(b) Any written agreement between the Mortgagor in respect of
a Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved the application of the Seller's underwriting standards
or some assessment of the Mortgagor's ability to repay the Modified Mortgage
Loan.
With respect to the representations and warranties set forth
in this Section 2.04 that are made to the best of the Seller's knowledge or as
to which the Seller has no knowledge, if it is discovered by the Depositor, the
Seller, the Servicer, the Trustee or the Custodian that the substance of such
representation and warranty is inaccurate and such inaccuracy materially and
adversely affects the value of the related Mortgage Loan or the interest therein
of the Certificateholders then, notwithstanding the Seller's lack of knowledge
with respect to the substance of such representation and warranty being
inaccurate at the time the representation or warranty was made, such inaccuracy
shall be deemed a breach of the applicable representation or warranty.
Upon discovery by the Depositor, the Seller, the Servicer, the
Trustee or the Custodian of a breach of any of the representations and
warranties contained in this Section that materially and adversely affects the
value of any Mortgage Loan or the interest therein of the Certificateholders,
the party discovering the breach shall give prompt written notice to the others
and in no event later than two Business Days from the date of such discovery.
Within ninety days of its discovery or its receipt of notice of any such missing
or materially defective
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documentation or any such breach of a representation or warranty, the Seller
shall promptly deliver such missing document or cure such defect or breach in
all material respects, or in the event such defect or breach cannot be cured,
the Seller shall repurchase the affected Mortgage Loan or cause the removal of
such Mortgage Loan from the Trust Fund and substitute for it one or more
Eligible Substitute Mortgage Loans, in either case, in accordance with Section
2.03.
It is understood and agreed that the representations and
warranties set forth in this Section 2.04 shall survive delivery of the Mortgage
Files to the Trustee and shall inure to the benefit of the Certificateholders
and the Depositor notwithstanding any restrictive or qualified endorsement or
assignment. It is understood and agreed that the obligations of the Seller set
forth in Section 2.03(a) to cure, substitute for or repurchase a Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement constitute the sole remedies
available to the Depositor and to the Certificateholders or to the Trustee on
their behalf respecting a breach of the representations and warranties contained
in this Section 2.04.
Section 2.05 Representations, Warranties and Covenants of the
Servicer.
The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of the Certificateholders and to the Depositor that as
of the Closing Date or as of such date specifically provided herein:
(i) The Servicer is duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its formation
and has all licenses necessary to carry on its business as now
being conducted, except for such licenses, certificates and
permits the absence of which, individually or in the aggregate,
would not have a material adverse effect on the ability of the
Servicer to conduct its business as it is presently conducted,
and is licensed, qualified and in good standing in the states
where the Mortgaged Property is located if the laws of such state
require licensing or qualification in order to conduct business
of the type conducted by the Servicer or to ensure the
enforceability or validity of each Mortgage Loan; the Servicer
has the power and authority to execute and deliver this Agreement
and to perform in accordance herewith; the execution, delivery
and performance of this Agreement (including all instruments of
transfer to be delivered pursuant to this Agreement) by the
Servicer and the consummation of the transactions contemplated
hereby have been duly and validly authorized; this Agreement
evidences the valid, binding and enforceable obligation of the
Servicer, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally; and all requisite
corporate action has been taken by the Servicer to make this
Agreement valid and binding upon the Servicer in accordance with
its terms;
(ii) The consummation of the transactions contemplated by
this Agreement are in the ordinary course of business of the
Servicer and will not result in the breach of any term or
provision of the certificate of formation or the partnership
agreement of the Servicer or result in the breach of any term or
provision of, or conflict with or constitute a default under or
result in the acceleration of any obligation under, any
agreement, indenture or loan or credit agreement or other
instrument to which the Servicer or its
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property is subject, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Servicer or
its property is subject;
(iii) The Servicer is an approved seller/servicer of
conventional mortgage loans for ▇▇▇▇▇▇ ▇▇▇, and is an FHA
Approved Mortgagee in good standing to service mortgages and has
not been suspended as a mortgagee or servicer by the FHA and has
the facilities, procedures and experienced personnel necessary
for the sound servicing of mortgage loans of the same type as the
Mortgage Loans. The Servicer is, and shall remain for as long as
it is servicing the Mortgage Loans hereunder, in good standing as
a FHA Approved Mortgagee and to service mortgage loans for HUD,
▇▇▇▇▇▇ Mae or ▇▇▇▇▇▇▇ Mac, and no event has occurred, including
but not limited to a change in insurance coverage, which would
make the Servicer unable to comply with HUD, ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇
Mac or FHA eligibility requirements or which would require
notification to any of HUD, ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or FHA;
(iv) This Agreement, and all documents and instruments
contemplated hereby which are executed and delivered by the
Servicer, constitute and will constitute valid, legal and binding
obligations of the Servicer, enforceable in accordance with their
respective terms, except as the enforcement thereof may be
limited by applicable bankruptcy laws and general principles of
equity;
(v) The Servicer does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and every
covenant contained in this Agreement;
(vi) There is no action, suit, proceeding or investigation
pending or, to its knowledge, threatened against the Servicer
that, either individually or in the aggregate, may result in any
material adverse change in the business, operations, financial
condition, properties or assets of the Servicer, or in any
material impairment of the right or ability of the Servicer to
carry on its business substantially as now conducted, or in any
material liability on the part of the Servicer, or that would
draw into question the validity or enforceability of this
Agreement or of any action taken or to be taken in connection
with the obligations of the Servicer contemplated herein, or that
would be likely to impair materially the ability of the Servicer
to perform under the terms of this Agreement;
(vii) No consent, approval or order of any court or
governmental agency or body is required for the execution,
delivery and performance by the Servicer of or compliance by the
Servicer with this Agreement or the consummation of the
transactions contemplated by this Agreement, except for such
consents, approvals, authorizations and orders, if any, that have
been obtained;
(viii) Neither this Agreement nor any information,
certificate of an officer, statement furnished in writing or
report delivered to the Trustee by the Servicer in connection
with the transactions contemplated hereby contains or will
contain any untrue statement of a material fact or omits or will
omit to state a material fact necessary in order to make the
statements contained therein, in light of the circumstances under
which they were made, not misleading; and
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(ix) The Servicer has accurately and fully reported, and
will continue to accurately and fully report, its borrower credit
files to each of the credit repositories in a timely manner.
It is understood and agreed that the representations,
warranties and covenants set forth in this Section 2.05 shall survive delivery
of the Mortgage Files to the Trustee and shall inure to the benefit of the
Trustee, the Depositor and the Certificateholders. Upon discovery by any of the
Depositor, the Servicer, the Seller or the Trustee of a breach of any of the
foregoing representations, warranties and covenants which materially and
adversely affects the value of any Mortgage Loan or the interests therein of the
Certificateholders, the party discovering such breach shall give prompt written
notice (but in no event later than two Business Days following such discovery)
to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The Depositor represents and warrants to the Trust and the
Trustee on behalf of the Certificateholders as follows:
(i) This Agreement constitutes a legal, valid and binding
obligation of the Depositor, enforceable against the Depositor in
accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general and
except as such enforceability may be limited by general
principles of equity (whether considered in a proceeding at law
or in equity);
(ii) Immediately prior to the sale and assignment by the
Depositor to the Trustee on behalf of the Trust of each Mortgage
Loan, the Depositor had good and marketable title to each
Mortgage Loan (insofar as such title was conveyed to it by the
Seller) subject to no prior lien, claim, participation interest,
mortgage, security interest, pledge, charge or other encumbrance
or other interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred
all right, title interest in the Mortgage Loans to the Trustee on
behalf of the Trust;
(iv) The Depositor has not transferred the Mortgage Loans to
the Trustee on behalf of the Trust with any intent to hinder,
delay or defraud any of its creditors;
(v) The Depositor has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware, with full corporate power and authority to own
its assets and conduct its business as presently being conducted;
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or
observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Depositor
is a party or by which it or its properties may be bound, which
default might result in any material adverse changes in the
financial condition, earnings, affairs or business of the
Depositor or which
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might materially and adversely affect the properties or assets,
taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this
Agreement by the Depositor, and the consummation of the
transactions contemplated thereby, do not and will not result in
a material breach or violation of any of the terms or provisions
of, or, to the knowledge of the Depositor, constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Depositor is a party
or by which the Depositor is bound or to which any of the
property or assets of the Depositor is subject, nor will such
actions result in any violation of the provisions of the articles
of incorporation or by-laws of the Depositor or, to the best of
the Depositor's knowledge without independent investigation, any
statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the
Depositor or any of its properties or assets (except for such
conflicts, breaches, violations and defaults as would not have a
material adverse effect on the ability of the Depositor to
perform its obligations under this Agreement);
(viii) To the best of the Depositor's knowledge without any
independent investigation, no consent, approval, authorization,
order, registration or qualification of or with any court or
governmental agency or body of the United States or any other
jurisdiction is required for the issuance of the Certificates, or
the consummation by the Depositor of the other transactions
contemplated by this Agreement, except such consents, approvals,
authorizations, registrations or qualifications as (a) may be
required under State securities or Blue Sky laws, (b) have been
previously obtained or (c) the failure of which to obtain would
not have a material adverse effect on the performance by the
Depositor of its obligations under, or the validity or
enforceability of, this Agreement; and
(ix) There are no actions, proceedings or investigations
pending before or, to the Depositor's knowledge, threatened by
any court, administrative agency or other tribunal to which the
Depositor is a party or of which any of its properties is the
subject: (a) which if determined adversely to the Depositor would
have a material adverse effect on the business, results of
operations or financial condition of the Depositor; (b) asserting
the invalidity of this Agreement or the Certificates; (c) seeking
to prevent the issuance of the Certificates or the consummation
by the Depositor of any of the transactions contemplated by this
Agreement, as the case may be; (d) which might materially and
adversely affect the performance by the Depositor of its
obligations under, or the validity or enforceability of, this
Agreement.
Section 2.07 Representations and Warranties of the Seller.
The Seller hereby represents and warrants to the Trust and the
Trustee on behalf of the Certificateholders that as of the Closing Date or as of
such date specifically provided herein:
(i) The Seller is duly organized, validly existing and in
good standing as a limited liability company under the laws of
the State of Delaware and has the power and
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authority to own its assets and to transact the business in which
it is currently engaged. The Seller is duly qualified to do
business and is in good standing in each jurisdiction in which
the character of the business transacted by it or properties
owned or leased by it requires such qualification and in which
the failure to so qualify would have a material adverse effect on
(a) its business, properties, assets or condition (financial or
other), (b) the performance of its obligations under this
Agreement, (c) the value or marketability of the Mortgage Loans,
or (d) its ability to foreclose on the related Mortgaged
Properties.
(ii) The Seller has the power and authority to make,
execute, deliver and perform this Agreement and to consummate all
of the transactions contemplated hereunder and has taken all
necessary action to authorize the execution, delivery and
performance of this Agreement. When executed and delivered, this
Agreement will constitute the Seller's legal, valid and binding
obligations enforceable in accordance with its terms, except as
enforcement of such terms may be limited by (1) bankruptcy,
insolvency, reorganization, receivership, moratorium or similar
laws affecting the enforcement of creditors' rights generally and
by the availability of equitable remedies, (2) general equity
principles (regardless of whether such enforcement is considered
in a proceeding in equity or at law) or (3) public policy
considerations underlying the securities laws, to the extent that
such policy considerations limit the enforceability of the
provisions of this Agreement which purport to provide
indemnification from securities laws liabilities.
(iii) The Seller holds all necessary licenses, certificates
and permits from all governmental authorities necessary for
conducting its business as it is presently conducted, except for
such licenses, certificates and permits the absence of which,
individually or in the aggregate, would not have a material
adverse effect on the ability of the Seller to conduct its
business as it is presently conducted. It is not required to
obtain the consent of any other party or any consent, license,
approval or authorization from, or registration or declaration
with, any governmental authority, bureau or agency in connection
with the execution, delivery, performance, validity or
enforceability of this Agreement, except for such consents,
licenses, approvals or authorizations, or registrations or
declarations as shall have been obtained or filed, as the case
may be, prior to the Closing Date.
(iv) The execution, delivery and performance of this
Agreement by the Seller will not conflict with or result in a
breach of, or constitute a default under, any provision of any
existing law or regulation or any order or decree of any court
applicable to the Seller or any of its properties or any
provision of its Limited Liability Company Agreement, or
constitute a material breach of, or result in the creation or
imposition of any lien, charge or encumbrance upon any of its
properties pursuant to any mortgage, indenture, contract or other
agreement to which it is a party or by which it may be bound.
(v) No certificate of an officer, written statement or
report delivered pursuant to the terms hereof by the Seller
contains any untrue statement of a material fact or omits to
state any material fact necessary to make the certificate,
statement or report not misleading.
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(vi) The transactions contemplated by this Agreement are in
the ordinary course of the Seller's business.
(vii) The Seller is not insolvent, nor will the Seller be
made insolvent by the transfer of the Mortgage Loans to the
Depositor, nor is the Seller aware of any pending insolvency.
(viii) The Seller is not in violation of, and the execution
and delivery of this Agreement by it and its performance and
compliance with the terms of this Agreement will not constitute a
violation with respect to any order or decree of any court, or
any order or regulation of any federal, state, municipal or
governmental agency having jurisdiction, which violation would
materially and adversely affect the Seller's condition (financial
or otherwise) or operations or any of the Seller's properties, or
materially and adversely affect the performance of any of its
duties hereunder.
(ix) There are no actions or proceedings against, or
investigations of, the Seller pending or, to its knowledge,
threatened, before any court, administrative agency or other
tribunal (i) that, if determined adversely, would prohibit the
Seller from entering into this Agreement, (ii) seeking to prevent
the consummation of any of the transactions contemplated by this
Agreement or (iii) that, if determined adversely, would prohibit
or materially and adversely affect the Seller's performance of
any of its respective obligations under, or the validity or
enforceability of, this Agreement.
(x) The Seller did not transfer the Mortgage Loans to the
Depositor with any intent to hinder, delay or defraud any of its
creditors.
(xi) The Seller acquired title to the Mortgage Loans in good
faith, without notice of any adverse claims.
(xii) The transfer, assignment and conveyance of the
Mortgage Notes and the Mortgages by the Seller to the Depositor
are not subject to the bulk transfer laws or any similar
statutory provisions in effect in any applicable jurisdiction.
Section 2.08 Covenants of the Seller.
(a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Depositor, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Depositor, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; provided, however, that nothing in this Section 2.09 shall prevent
or be deemed to prohibit the Seller from suffering to exist upon any of the
Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
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(b) The Seller hereby covenants that neither it nor any
Affiliate of the Seller will directly solicit any Mortgagor hereunder to
refinance the related Mortgage Loan. For the purposes of the foregoing, neither
the Seller nor any Affiliate of the Seller shall be deemed to directly solicit
any Mortgagor if the Seller responds to a request from a Mortgagor regarding a
refinancing or if the Mortgagor receives marketing materials which are generally
disseminated.
Section 2.09 Conveyance of REMIC 1 Regular Interests and
Acceptance of REMIC 1 by the Trustee; Issuance of Certificates.
(a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the assets described in the definition of REMIC 1 for the
benefit of the holders of the REMIC 1 Regular Interests (which are
uncertificated) and the Class R Certificates (in respect of the Class R-1
Interest). The Trustee acknowledges receipt of the assets described in the
definition of REMIC 1 and declares that it holds and will hold the same in trust
for the exclusive use and benefit of the holders of the REMIC 1 Regular
Interests and the Class R Certificates (in respect of the Class R-1 Interest).
The interests evidenced by the Class R-1 Interest, together with the REMIC 1
Regular Interests, constitute the entire beneficial ownership interest in REMIC
1.
(b) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the REMIC 1 Regular Interests for the benefit of the holders
of the Regular Certificates, the REMIC 2 Regular Interests (which are
uncertificated) and the Class R Certificates (in respect of the Class R-2
Interest). The Trustee acknowledges receipt of the REMIC 1 Regular Interests and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of the holders of the Regular Certificates, the REMIC 2 Regular
Interests and the Class R Certificates (in respect of the Class R-2 Interest).
The interests evidenced by the Class R-2 Interest, together with the
Certificates and the REMIC 2 Regular Interests, constitute the entire beneficial
ownership interest in REMIC 2.
(c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 1 and the acceptance by the Trustee thereof, pursuant to
Section 2.01 and Section 2.02 and (ii) the assignment and delivery to the
Trustee of REMIC 2 (including the Residual Interest therein represented by the
Class R-2 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.10(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R Certificates in
authorized denominations evidencing the Class R-1 Interest and the Class R-2
Interest, the Class A Certificates, the Class M-1 Certificates, the Class M-2
Certificates, the Class M-3 Certificates, the Class B-2 Interest, the Class B-3
Interest, the Class B-4 Interest and the Class X/N Interest.
Section 2.10 Conveyance of Class B-2 Interest and Acceptance
of REMIC 3 by the Trustee; Issuance of the Class B-2 Certificates.
(a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all
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the right, title and interest of the Depositor in and to the Class B-2 Interest
for the benefit of the holders of the Class B-2 Certificates. The Trustee
acknowledges receipt of the Class B-2 Interest (which is uncertificated) and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of the holders of the Class B-2 Certificates. The Class R-3 Interest,
together with the Class B-2 Certificates, constitute the entire beneficial
ownership interest in REMIC 3.
(b) In exchange for the Class B-2 Interest and, concurrently
with the assignment to the Trustee thereof, pursuant to the written request of
the Depositor executed by an officer of the Depositor, the Trustee has executed,
authenticated and delivered to or upon the order of the Depositor, the Class B-2
Certificates in authorized denominations evidencing (together with the Class R-3
Interest) the entire beneficial ownership interest in REMIC 3.
(c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 3 (including the Residual Interest therein represented by the
Class R-3 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.10(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R-3 Interest.
Section 2.11 Conveyance of Class B-3 Interest and Acceptance
of REMIC 4 by the Trustee; Issuance of the Class B-3 Certificates.
(a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the Class B-3 Interest for the benefit of the holders of the
Class B-3 Certificates. The Trustee acknowledges receipt of the Class B-3
Interest (which is uncertificated) and declares that it holds and will hold the
same in trust for the exclusive use and benefit of the holders of the Class B-3
Certificates. The Class R-4 Interest, together with the Class B-3 Certificates,
constitute the entire beneficial ownership interest in REMIC 4.
(b) In exchange for the Class B-3 Interest and, concurrently
with the assignment to the Trustee thereof, pursuant to the written request of
the Depositor executed by an officer of the Depositor, the Trustee has executed,
authenticated and delivered to or upon the order of the Depositor, the Class B-3
Certificates in authorized denominations evidencing (together with the Class R-4
Interest) the entire beneficial ownership interest in REMIC 4.
(c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 4 (including the Residual Interest therein represented by the
Class R-3 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.11(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R-4 Interest.
Section 2.12 Conveyance of Class B-4 Interest and Acceptance
of REMIC 5 by the Trustee; Issuance of the Class B-4 Certificates.
(a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all
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the right, title and interest of the Depositor in and to the Class B-5 Interest
for the benefit of the holders of the Class B-4 Certificates. The Trustee
acknowledges receipt of the Class B-4 Interest (which is uncertificated) and
declares that it holds and will hold the same in trust for the exclusive use and
benefit of the holders of the Class B-4 Certificates. The Class R-5 Interest,
together with the Class B-4 Certificates, constitute the entire beneficial
ownership interest in REMIC 5.
(b) In exchange for the Class B-4 Interest and, concurrently
with the assignment to the Trustee thereof, pursuant to the written request of
the Depositor executed by an officer of the Depositor, the Trustee has executed,
authenticated and delivered to or upon the order of the Depositor, the Class B-4
Certificates in authorized denominations evidencing (together with the Class R-5
Interest) the entire beneficial ownership interest in REMIC 5.
(c) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 5 (including the Residual Interest therein represented by the
Class R-5 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.12(b), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R-5 Interest.
Section 2.13 Conveyance of Class X/N Interest and Acceptance
of REMIC 6 by the Trustee; Issuance of the Class X/N Certificates.
(a) The Depositor, concurrently with the execution and
delivery hereof, does hereby transfer, assign, set over and otherwise convey in
trust to the Trustee without recourse all the right, title and interest of the
Depositor in and to the Class X/N Interest for the benefit of the holders of the
Class X/N Certificates. The Trustee acknowledges receipt of the Class X/N
Interest (which is uncertificated) and declares that it holds and will hold the
same in trust for the exclusive use and benefit of the holders of the Class X/N
Certificates. The Class R-6 Interest, together with the Class X Certificates,
constitute the entire beneficial ownership interest in REMIC 6.
(b) Concurrently with (i) the assignment and delivery to the
Trustee of REMIC 6 (including the Residual Interest therein represented by the
Class R-6 Interest) and the acceptance by the Trustee thereof, pursuant to
Section 2.13(a), the Trustee, pursuant to the written request of the Depositor
executed by an officer of the Depositor, has executed, authenticated and
delivered to or upon the order of the Depositor, the Class R-6 Interest.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.
The Servicer, as independent contract servicer, shall service
and administer the Mortgage Loans in accordance with this Agreement and the
normal and usual standards of practice of prudent mortgage servicers, 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 the
Servicer may deem necessary or desirable and consistent with the terms of this
Agreement including, in the case of FHA Loans, taking all actions that a
mortgagee is permitted or required to take by the FHA (the "Servicing
Standards").
Consistent with the terms of this Agreement, the Servicer may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor if in the Servicer's reasonable and prudent
determination such waiver, modification, postponement or indulgence is not
materially adverse to the Certificateholders; provided, however, that the
Servicer shall not make future advances and (unless the Mortgagor is in default
with respect to the Mortgage Loan or such default is, in the judgment of the
Servicer, reasonably foreseeable) the Servicer shall not permit any modification
with respect to any Mortgage Loan that would (i) change the Mortgage Interest
Rate, defer or forgive the payment thereof of any principal or interest
payments, reduce the outstanding principal amount (except for actual payments of
principal) or extend the final maturity date with respect to such Mortgage Loan,
(ii) in the case of FHA Loans, affect the FHA Insurance Contract with respect to
such Mortgage Loan, (iii) affect adversely the status of any REMIC as a REMIC or
(iv) cause any REMIC to be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions. Notwithstanding the foregoing,
the Servicer shall not permit any modification with respect to any Mortgage Loan
that would both (x) effect an exchange or reissuance of such Mortgage Loan under
Section 1.860G-2(b) of the Treasury Regulations and (y) cause any REMIC
constituting part of the Trust Fund to fail to qualify as a REMIC under the Code
or the imposition of any tax on "prohibited transactions" or "contributions"
after the Startup Day under the REMIC Provisions. Without limiting the
generality of the foregoing, the Servicer shall continue, and is hereby
authorized and empowered to execute and deliver on behalf of itself, and the
Trustee, all instruments of satisfaction or cancellation, or of partial or full
release, discharge and all other comparable instruments, with respect to the
Mortgage Loans and with respect to the Mortgaged Property. The Servicer shall
make all required Servicing Advances and shall service and administer the
Mortgage Loans in accordance with Applicable Regulations, and shall provide to
the Mortgagor any reports required to be provided to them thereby. If reasonably
required by the Servicer, the Trustee shall furnish the Servicer with a power of
attorney substantially in the form of Exhibit P hereto and other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties under this Agreement and the Trustee shall have no
liability with respect to any misuse of such power of attorney and shall be
indemnified by the Servicer for any costs, liabilities or expenses incurred by
the Trustee in connection therewith.
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Notwithstanding anything in this Agreement to the contrary,
the Servicer shall be prohibited from foreclosing on any Mortgage Loan based on
the delinquency status thereof as of the Cut-off Date.
In servicing and administering FHA Loans, the Servicer shall
comply strictly with the National Housing Act and the FHA Regulations, and
administrative guidelines issued thereunder or pursuant thereto (insofar as the
same apply to any Mortgage Loan) and, to the extent permitted hereunder,
promptly discharge all of the obligations of the mortgagee thereunder and under
each Mortgage including the timely giving of notices, the essence hereof being
that the full benefits of each FHA Insurance Contract inure to the Trustee, on
behalf of the Certificateholders.
In servicing and administering the Mortgage Loans, the
Servicer shall employ procedures including collection procedures and exercise
the same care that it customarily employs and exercises in servicing and
administering mortgage loans for its own account giving due consideration to
accepted mortgage servicing practices of prudent lending institutions, the FHA
Insurance Contracts, where applicable, and the Certificateholders' reliance on
the Servicer.
The Servicer shall give prompt notice to the Trustee of any
action, of which the Servicer has actual knowledge, which action purports to (i)
assert a claim against the Trust Fund or (ii) assert jurisdiction over the Trust
Fund.
Notwithstanding anything in this Agreement to the contrary, in
the event of a Principal Prepayment in full of a Mortgage Loan, the Servicer may
not waive any Prepayment Charge or portion thereof required by the terms of the
related Mortgage Note unless (i) the Servicer determines that such waiver would
maximize recovery of Liquidation Proceeds for such Mortgage Loan, taking into
account the value of such Prepayment Charge, (ii) (A) the enforceability thereof
is limited (1) by bankruptcy, insolvency, moratorium, receivership, or other
similar law relating to creditors' rights generally or (2) due to acceleration
in connection with a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by applicable law or (iii) the
Servicer has not been provided with information sufficient to enable it to
collect the Prepayment Charge. In the event of a Principal Prepayment in full
with respect to any Mortgage Loan, the Servicer shall deliver to the Trustee an
Officer's Certificate substantially in the form of Exhibit N no later than the
date on which the Servicer delivers the Remittance Report to the Trustee and the
Trustee will make such Officer's Certificate available on its website to the
Class X Certificateholders. If the Servicer has waived or does not collect all
or a portion of a Prepayment Charge relating to a Principal Prepayment in full
due to any action or omission of the Servicer, other than as provided above, the
Servicer shall, within 90 days of the date on which the Principal Prepayment in
full is remitted to the Trustee, deliver to the Trustee the amount of such
Prepayment Charge (or such portion thereof as had been waived for deposit) into
the Distribution Account for distribution in accordance with the terms of this
Agreement.
The Trustee shall make available on its website to the
Depositor and the owner of the Class N and Class X Certificates, on a monthly
basis, a statement setting forth the amounts received with respect to Prepayment
Charges.
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Section 3.02 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and
interest on all Mortgage Loans are paid in full, the Servicer will diligently
collect all payments due under each Mortgage Loan when the same shall become due
and payable and shall, to the extent such procedures shall be consistent with
this Agreement and Applicable Regulations, follow such collection procedures as
it follows with respect to mortgage loans comparable to the Mortgage Loans and
held for its own account. Further, the Servicer will take special care in
ascertaining and estimating annual ground rents, taxes, assessments, water
rates, fire and hazard insurance premiums, mortgage insurance premiums, and all
other charges that, as provided in the Mortgage, will become due and payable to
that end that the installments payable by the Mortgagors will be sufficient to
pay such charges as and when they become due and payable.
Section 3.03 Realization Upon Defaulted Mortgage Loans.
In the event that any payment due under any Conventional
Mortgage Loan is not paid when the same becomes due and payable, or in the event
the Mortgagor fails to perform any other covenant or obligation under the
Mortgage Loan and such failure continues beyond any applicable grace period, the
Servicer shall take such action as it shall deem to be in the best interest of
the Certificateholders. In the event that any payment due under any FHA Loan
becomes delinquent, the Servicer shall take all such actions as are in the best
interests of the Certificateholders and permitted under any applicable FHA loss
mitigation proceedings, including, but not limited to, requesting the FHA to
accept an assignment of such FHA Loan, and, upon the Servicer's determination
that foreclosure is in the best interest of the Certificateholders, commencing
foreclosure proceedings. With respect to any defaulted Mortgage Loan, the
Servicer shall have the right to review the status of the related forbearance
plan and, subject to the second paragraph of Section 3.01, may modify such
forbearance plan; including, extending the Mortgage Loan repayment date for a
period of one year or reducing the Mortgage Interest Rate up to 50 basis points.
In connection with a foreclosure or other conversion, the
Servicer shall exercise such rights and powers vested in it hereunder and use
the same degree of care and skill in its exercise as prudent mortgage servicers
would exercise or use under the circumstances in the conduct of their own
affairs and consistent with Applicable Regulations and the servicing standards
set forth in the ▇▇▇▇▇▇ ▇▇▇ Guide, including, without limitation, advancing
funds for the payment of taxes and insurance premiums with respect to first lien
Mortgage Loans.
Notwithstanding the foregoing provisions of this Section 3.03,
with respect to any Mortgage Loan as to which the Servicer has received actual
notice of, or has actual knowledge of, the presence of any toxic or hazardous
substance on the related Mortgaged Property, the Servicer shall not either (i)
obtain title to such Mortgaged Property as a result of or in lieu of foreclosure
or otherwise, or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property if, as a result of any such action, the
Trust Fund would be considered to hold title to, to be a mortgagee-in-possession
of, or to be an owner or operator of such Mortgaged Property within the meaning
of the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or any comparable law, unless the Servicer
has also previously determined, based on its reasonable judgment
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and a prudent report prepared by a Person who regularly conducts environmental
audits using customary industry standards, that:
A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic interest of
the Certificateholders to take such actions as are necessary to bring the
Mortgaged Property into compliance therewith; and
B. there are no circumstances present at such Mortgaged
Property relating to the use, management or disposal of any hazardous
substances, hazardous materials, hazardous wastes, or petroleum-based materials
for which investigation, testing, monitoring, containment, clean-up or
remediation could be required under any federal, state or local law or
regulation, or that if any such materials are present for which such action
could be required, that it would be in the best economic interest of the
Certificateholders to take such actions with respect to the affected Mortgaged
Property.
The cost of the environmental audit report contemplated by
this Section 3.03 shall be advanced by the Servicer, subject to the Servicer's
right to be reimbursed therefor from the Collection Account as provided in
Section 3.05(ii).
If the Servicer determines, as described above, that it is in
the best economic interest of the Certificateholders to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Servicer shall take such action as it deems to be in the best economic
interest of the Certificateholders. The cost of any such compliance,
containment, cleanup or remediation shall be advanced by the Servicer, subject
to the Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.05(ii).
Section 3.04 Collection Account and Distribution Account.
(a) The Servicer shall segregate and hold all funds collected
and received pursuant to each Mortgage Loan separate and apart from any of its
own funds and general assets and shall establish and maintain one or more
Collection Accounts. Each Collection Account shall be an Eligible Account.
The Servicer shall deposit in the Collection Account on a
daily basis within two Business Days of receipt, and retain therein, the
following payments and collections received or made by it after the Cut-off Date
with respect to the Mortgage Loans:
(i) all payments on account of principal, including
Principal Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage
Loans adjusted to the Mortgage Interest Rate less the Servicing
Fee Rate;
(iii) all proceeds from a Final Recovery Determination;
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(iv) all Insurance Proceeds including amounts required to be
deposited pursuant to Section 3.10, other than proceeds to be
held in the Escrow Account and applied to the restoration or
repair of the Mortgaged Property or released to the Mortgagor in
accordance with the Servicer's normal servicing procedures, the
loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged
Property which are not released to the Mortgagor in accordance
with the Servicer's normal servicing procedures, the loan
documents or applicable law;
(vi) all Subsequent Recoveries; and
(vii) any amounts required to be deposited by the Servicer
in connection with any REO Property pursuant to Section 3.13.
Any interest paid on funds deposited in the Collection
Account, subject to Section 3.25, shall accrue to the benefit of the Servicer
and the Servicer shall be entitled to retain and withdraw such interest from the
Collection Account pursuant to Section 3.05(v). The foregoing requirements for
deposit from the Collection Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of late payment charges, prepayment charges that are not Prepayment
Charges, and assumption fees need not be deposited by the Servicer in the
Collection Account.
(b) On behalf of the Trust Fund and the Trustee, the Trustee
shall establish and maintain one or more accounts (such account or accounts, the
"Distribution Account"), held in trust for the benefit of the
Certificateholders. On behalf of the Trust Fund, the Servicer shall deliver to
the Trustee in immediately available funds for deposit in the Distribution
Account by the close of business New York time on the Servicer Remittance Date,
that portion of the Available Funds (calculated without regard to the references
in the definition thereof to amounts that may be deposited to the Distribution
Account from a different source as provided herein) then on deposit in the
Collection Account.
(c) Funds in the Collection Account and the Distribution
Account may be invested in Permitted Investments in accordance with the
provisions set forth in Section 3.25. The Servicer shall give notice to the
Trustee of the location of the Collection Account maintained by it when
established and prior to any change thereof. The Trustee shall give notice to
the Servicer and the Depositor of the location of the Distribution Account when
established and prior to any change thereof.
(d) In the event the Servicer shall deliver to the Trustee for
deposit in the Distribution Account any amount not required to be deposited
therein, it may at any time request that the Trustee withdraw such amount from
the Distribution Account and remit to the Servicer any such amount, any
provision herein to the contrary notwithstanding. In addition, the Servicer
shall deliver to the Trustee from time to time for deposit, and the Trustee
shall so deposit, in the Distribution Account in respect of REMIC 1:
(i) any Advances, as required pursuant to Section 4.07;
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(ii) any Stayed Funds, as soon as permitted by the federal
bankruptcy court having jurisdiction in such matters;
(iii) any Prepayment Charges or amounts in connection with
the waiver of such Prepayment Charges, in each case required to
be deposited pursuant to Section 3.01;
(iv) any amounts required to be deposited in the
Distribution Account pursuant to Sections 2.03, 3.04, 3.15, 3.16,
3.23 or 4.07; and
(v) any amounts required to be deposited by the Servicer
pursuant to Section 3.11 in connection with the deductible clause
in any blanket hazard insurance policy, such deposit being made
from the Servicer's own funds, without reimbursement therefor.
(e) Promptly upon receipt of any Stayed Funds, whether from
the Servicer, a trustee in bankruptcy, or federal bankruptcy court or other
source, the Trustee shall notify the Servicer of such receipt and deposit such
funds in the Distribution Account, subject to withdrawal thereof as permitted
hereunder.
Section 3.05 Permitted Withdrawals From the Collection
Account.
The Servicer may, from time to time, withdraw from the
Collection Account for the following purposes:
(i) to remit to the Trustee for deposit in the Distribution
Account the amounts required to be so remitted pursuant to
Section 3.04(b) or permitted to be so remitted pursuant to the
first sentence of Section 3.04(d);
(ii) to reimburse itself for (x) Advances and Servicing
Advances; the Servicer's right to reimburse itself pursuant to
this subclause (ii) being limited to amounts received on the
related Mortgage Loan which represent payments of (a) principal
and/or interest respecting which any such Advance was made or (b)
Condemnation Proceeds, Insurance Proceeds or Liquidation Proceeds
respecting which any such Servicing Advance was made or (y) any
unreimbursed Advances made pursuant to Section 4.07(b) to the
extent of funds held in the Collection Account for future
distribution that were not included in Available Funds for the
preceding Distribution Date;
(iii) to reimburse itself for unreimbursed Servicing
Advances, any unpaid Servicing Fees and for unreimbursed Advances
to the extent that such amounts are deemed to be Nonrecoverable
Advances, and to reimburse itself for such amounts to the extent
that such amounts are nonrecoverable from the disposition of REO
Property pursuant to Section 3.03 or Section 3.13 hereof;
(iv) to reimburse itself for any amounts paid pursuant to
Section 3.03 (and not otherwise previously reimbursed);
(v) to pay to itself as servicing compensation (a) any
interest earned on funds in the Collection Account (all such
interest to be withdrawn monthly not later than each Servicer
Remittance Date) and (b) the Servicing Fee from that portion of
any payment or
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recovery as to interest to a particular Mortgage Loan to the
extent not retained pursuant to Section 3.04(ii);
(vi) to pay or reimburse itself or any other party for any
amounts payable or paid pursuant to Section 3.26 or Section 6.03
(and not otherwise previously reimbursed); and
(vii) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Servicer shall deposit in the
Collection Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Collection Account, any provision herein
to the contrary notwithstanding.
Section 3.06 Establishment of Escrow Accounts; Deposits in
Escrow Accounts.
The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan which constitute Escrow Payments
separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Escrow Accounts, in the form of time deposit
or demand accounts. A copy of such letter agreement shall be furnished to the
Trustee upon request. The Escrow Account shall be an Eligible Account.
The Servicer shall deposit in the Escrow Account or Accounts
on a daily basis within two Business Days of receipt, and retain therein, (i)
all Escrow Payments collected on account of the Mortgage Loans, for the purpose
of effecting timely payment of any such items as required under the terms of
this Agreement, and (ii) all Insurance Proceeds which are to be applied to the
restoration or repair of any Mortgaged Property. The Servicer shall make
withdrawals therefrom only to effect such payments as are required under this
Agreement, and for such other purposes as shall be set forth in, or in
accordance with, Section 3.07. The Servicer shall be entitled to retain any
interest paid on funds deposited in the Escrow Account by the depository
institution other than interest on escrowed funds required by law to be paid to
the Mortgagor and, to the extent required by the related Mortgage Loan or
Applicable Regulations, the Servicer shall pay interest on escrowed funds to the
Mortgagor notwithstanding that the Escrow Account is non-interest bearing or
that interest paid thereon is insufficient for such purposes.
Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account may be made by the
Servicer (i) to effect timely payments of ground rents, taxes, assessments,
water rates, fire, flood and hazard insurance premiums, and comparable items,
(ii) to reimburse the Servicer for any Servicing Advance made by the Servicer
with respect to a related Mortgage Loan but only from amounts received on the
related Mortgage Loan which represent late payments or Late Collections of
Escrow Payments thereunder, (iii) to refund to the Mortgagor any funds as may be
determined to be overages, (iv) for transfer to the Collection Account in
accordance with the terms of this Agreement, (v) for application to restoration
or repair of the Mortgaged Property, (vi) to pay to the Servicer, or to the
Mortgagor to the extent required by the related Mortgage Loan or Applicable
Regulations,
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any interest paid on the funds deposited in the Escrow Account, (vii) to clear
and terminate the Escrow Account on the termination of this Agreement, (viii) to
transfer to the Collection Account any insurance proceeds, or (ix) in the case
of FHA Loans, for transfer to the Collection Account, fire and hazard insurance
proceeds and Escrow Payments with respect to any Mortgage Loan where the FHA has
directed application of such funds as a credit against the proceeds of the FHA
Insurance Contract. As part of its servicing duties, the Servicer shall pay to
the Mortgagor interest on funds in the Escrow Account, to the extent required by
the related Mortgage Loan or Applicable Regulations, and to the extent that
interest earned on funds in the Escrow Account is insufficient, shall pay such
interest from its own funds, without any reimbursement therefor.
In the event the Servicer shall deposit in the Escrow Account
any amount not required to be deposited therein, it may at any time withdraw
such amount from the Escrow Account, any provision herein to the contrary
notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges;
Collections Thereunder.
With respect to each first lien Mortgage Loan, the Servicer
shall maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates and other charges which are or may become a lien upon
the Mortgaged Property and fire, flood and hazard insurance coverage and shall
obtain, from time to time, all bills for the payment of such charges (including
renewal premiums) and shall effect payment thereof prior to the applicable
penalty or termination date and at a time appropriate for securing maximum
discounts allowable, employing for such purpose deposits of the Mortgagor in the
Escrow Account which shall have been estimated and accumulated by the Servicer
in amounts sufficient for such purposes, as allowed under the terms of the
Mortgage or Applicable Regulations. To the extent that a Mortgage does not
provide for Escrow Payments, the Servicer (i) shall determine whether any such
payments are made by the Mortgagor in a manner and at a time that is necessary
to avoid the loss of the Mortgaged Property due to a tax sale or the foreclosure
as a result of a tax lien and (ii) shall ensure that all insurance required to
be maintained on the Mortgaged Property pursuant to this Agreement is
maintained. If any such payment has not been made and the Servicer receives
notice of a tax lien with respect to the Mortgage Loan being imposed, the
Servicer will, to the extent required to avoid loss of the Mortgaged Property,
advance or cause to be advanced funds necessary to discharge such lien on the
Mortgaged Property. The Servicer assumes full responsibility for the payment of
all such bills and shall effect payments of all such bills irrespective of the
Mortgagor's faithful performance in the payment of same or the making of the
Escrow Payments and shall make Servicing Advances from its own funds to effect
such payments.
Section 3.09 Transfer of Accounts.
The Servicer may transfer the Collection Account or the Escrow
Account to a different depository institution from time to time. Upon such
transfer, the Servicer shall deliver to the Trustee and the Depositor, a
certification or letter agreement, as the case may be, as required pursuant to
Sections 3.04 and 3.06.
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Section 3.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each first lien
Mortgage Loan fire and hazard insurance with extended coverage as is customary
in the area where the Mortgaged Property is located in an amount which is at
least equal to the lesser of (i) the amount necessary to fully compensate for
any damage or loss to the improvements which are a part of such property on a
replacement cost basis, (ii) the Principal Balance of the Mortgage Loan, in each
case in an amount not less than such amount as is necessary to prevent the
Mortgagor and/or the Mortgagee from becoming a co-insurer or (iii) the amount
required under applicable HUD/FHA regulations. If the Mortgaged Property is in
an area identified in the Federal Register by the Flood Emergency Management
Agency as having special flood hazards and flood insurance has been made
available, the Servicer will cause to be maintained a flood insurance policy
meeting the requirements of the current guidelines of the Federal Insurance
Administration with a generally acceptable insurance carrier, in an amount
representing coverage not less than the least of (i) the Principal Balance of
the Mortgage Loan, (ii) the maximum insurable value of the improvements securing
such Mortgage Loan or (iii) the maximum amount of insurance which is available
under the Flood Disaster Protection Act of 1973, as amended. The Servicer shall
also maintain on the REO Property for the benefit of the Certificateholders, (x)
fire and hazard insurance with extended coverage in an amount which is at least
equal to the replacement cost of the improvements which are a part of such
property, (y) public liability insurance and, (z) to the extent required and
available under the Flood Disaster Protection Act of 1973, as amended, flood
insurance in an amount as provided above. Any amounts collected by the Servicer
under any such policies other than amounts to be deposited in the Escrow Account
and applied to the restoration or repair of the Mortgaged Property or REO
Property, or released to the Mortgagor in accordance with the Servicer's normal
servicing procedures, shall be deposited in the Collection Account, subject to
withdrawal pursuant to Section 3.05. It is understood and agreed that no
earthquake or other additional insurance is required to be maintained by the
Servicer or the Mortgagor or maintained on property acquired in respect of the
Mortgage Loan, other than pursuant to such Applicable Regulations as shall at
any time be in force and as shall require such additional insurance. All such
policies shall be endorsed with standard mortgagee clauses with loss payable to
the Servicer and shall provide for at least thirty days prior written notice of
any cancellation, reduction in the amount of or material change in coverage to
the Servicer. The Servicer shall not interfere with the Mortgagor's freedom of
choice in selecting either his insurance carrier or agent, provided, however,
that the Servicer shall not accept any such insurance policies from insurance
companies unless such companies currently reflect a general policy rating of
B:VI or better in Best's Key Rating Guide and are licensed to do business in the
state wherein the property subject to the policy is located.
Section 3.11 Maintenance of Mortgage Impairment Insurance
Policy.
In the event that the Servicer shall obtain and maintain a
blanket policy issued by an insurer that has a general policy rating of B:VI or
better in Best's Key Rating Guide insuring against hazard losses on all of the
Mortgage Loans, then, to the extent such policy provides coverage in an amount
equal to the amount required pursuant to Section 3.10 and otherwise complies
with all other requirements of Section 3.10, it shall conclusively be deemed to
have satisfied its obligations as set forth in Section 3.10, it being understood
and agreed that such policy may contain a deductible clause, in which case the
Servicer shall, in the event that there
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shall not have been maintained on the related Mortgaged Property or REO Property
a policy complying with Section 3.10, and there shall have been a loss which
would have been covered by such policy, deliver to the Trustee for deposit in
the Distribution Account the amount not otherwise payable under the blanket
policy because of such deductible clause, which amount shall not be reimbursable
to the Servicer from the Trust Fund. In connection with its activities as
servicer of the Mortgage Loans, the Servicer agrees to prepare and present, on
behalf of the Trustee, claims under any such blanket policy in a timely fashion
in accordance with the terms of such policy. Upon request of the Trustee, the
Servicer shall cause to be delivered to the Trustee a certified true copy of
such policy and a statement from the insurer thereunder that such policy shall
in no event be terminated or materially modified without thirty days prior
written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket
fidelity bond (the "Fidelity Bond") and an errors and omissions insurance
policy, with broad coverage with financially responsible companies on all
officers, employees or other persons acting in any capacity with regard to the
Mortgage Loans to handle funds, money, documents and papers relating to the
Mortgage Loans. The Fidelity Bond and errors and omissions insurance shall be in
the form of the Mortgage Banker's Blanket Bond and shall protect and insure the
Servicer against losses, including forgery, theft, embezzlement, fraud, errors
and omissions and negligent acts of such persons. Such Fidelity Bond shall also
protect and insure the Servicer against losses in connection with the failure to
maintain any insurance policies required pursuant to this Agreement and the
release or satisfaction of a Mortgage Loan without having obtained payment in
full of the indebtedness secured thereby. No provision of this Section 3.12
requiring the Fidelity Bond and errors and omissions insurance shall diminish or
relieve the Servicer from its duties and obligations as set forth in this
Agreement. The minimum coverage under any such bond and insurance policy shall
be at least equal to the corresponding amounts required by ▇▇▇▇▇▇ ▇▇▇ in the
▇▇▇▇▇▇ Mae MBS Selling and Servicing Guide or by ▇▇▇▇▇▇▇ Mac in the ▇▇▇▇▇▇▇ Mac
Servicer's Guide. Upon request of the Trustee, the Servicer shall cause to be
delivered to the requesting party a certified true copy of the Fidelity Bond and
errors and omissions insurance policy and a statement from the surety and the
insurer that such Fidelity Bond and errors and omissions insurance policy shall
in no event be terminated or materially modified without thirty days' prior
written notice to the Trustee.
Section 3.13 Title, Management and Disposition of REO
Property.
(a) In the event that title to a Mortgaged Property is
acquired in foreclosure or by deed in lieu of foreclosure, the deed or
certificate of sale shall be taken (pursuant to a limited power of attorney to
be provided by the Trustee to the Servicer) in the name of the Trustee, on
behalf of the Certificateholders, or in the event the Trustee is not authorized
or permitted to hold title to real property in the state where the REO Property
is located, or would be adversely affected under the "doing business" or tax
laws of such state by so holding title, the deed or certificate of sale shall be
taken in the name of such Person or Persons as shall be consistent with an
Opinion of Counsel obtained by the Servicer from an attorney duly licensed to
practice law in the state where the REO Property is located. Any Person or
Persons holding such title other than the
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Trustee shall acknowledge in writing that such title is being held as nominee
for the benefit of the Trustee.
(b) In the event that the Trust Fund acquires any REO Property
as aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such REO Property before the end of
the third calendar year beginning after the year of its acquisition by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or, at the expense of the
Trust Fund, request from the Internal Revenue Service, more than 60 days before
the day on which the above-mentioned grace period would otherwise expire, an
extension of the above-mentioned grace period, unless the Servicer obtains an
Opinion of Counsel, addressed to the Servicer and the Trustee, to the effect
that the holding by the Trust Fund of such REO Property subsequent to such
period will not: (i) result in the imposition of any tax on "prohibited
transactions" as defined in Section 860F of the Code; or (ii) cause any REMIC
constituting any part of the Trust Fund to fail to qualify as a REMIC at any
time that any Certificates are outstanding, in which case the Trust Fund may
continue to hold such REO Property (subject to any conditions contained in such
Opinion of Counsel). The Servicer shall be entitled to be reimbursed from the
Collection Account for any costs incurred in obtaining such Opinion of Counsel,
as provided in Section 3.05.
Subject to compliance with applicable laws and regulations as
shall at any time be in force, and notwithstanding any other provisions of this
Agreement, no REO Property acquired by the Trust Fund shall be rented (or
allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would: (i) cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code; or (ii) subject any REMIC constituting part of
the Trust Fund to the imposition of any federal income taxes on the income
earned from such REO Property, including any taxes imposed by reason of Sections
860F or 860G(c) of the Code, unless the Servicer has agreed to indemnify and
hold harmless the Trust Fund with respect to the imposition of any such taxes.
The Servicer shall manage, conserve, protect and operate each
REO Property for the Certificateholders and the Trust Fund 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
Section 860G(a)(8) of the Code or result in the receipt by the related REMIC of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure property" which
is subject to taxation under the REMIC Provisions. The Servicer shall cause each
REO Property to be inspected promptly upon the acquisition of title thereto and
shall cause each REO Property to be inspected at least annually thereafter. The
Servicer shall make or cause to be made a written report of each such
inspection. Such reports shall be retained in the Mortgage Servicing File and
copies thereof shall be forwarded by the Servicer to the Trustee upon request.
The Servicer shall attempt to sell the same (and may temporarily rent the same)
on such terms and conditions as the Servicer deems to be in the best interest of
the Certificateholders and the Trust Fund.
With respect to each REO Property, the Servicer shall account
separately for each REO Property with respect to all funds collected and
received in connection with the operation of such REO Property.
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The Servicer shall deposit or cause to be deposited, on a
daily basis, within two Business Days of receipt, in the Collection Account, all
revenues received with respect to each REO Property and shall withdraw therefrom
funds necessary for the proper operation, management and maintenance of the
related REO Property, including the cost of maintaining any hazard insurance
pursuant to Section 3.10 hereof and the fees of any managing agent acting on
behalf of the Servicer.
The Servicer shall furnish to the Trustee, on each Servicer
Remittance Date, an operating statement for each REO Property covering the
operation of each REO Property for the previous month. Such operating statement
shall be accompanied by such other information as the Trustee shall reasonably
request.
The Servicer shall use its best efforts to dispose of the REO
Property as promptly as is practically consistent with protecting the
Certificateholders' interests.
Each REO Disposition shall be carried out by the Servicer at
such price and upon such terms and conditions as the Servicer deems to be in the
best interest of the Certificateholders. If as of the date title to any REO
Property was acquired by the Servicer there were outstanding unreimbursed
Servicing Advances with respect to the REO Property, the Servicer, upon an REO
Disposition of such REO Property, shall be entitled to reimbursement for any
related unreimbursed Servicing Advances from proceeds received in connection
with such REO Disposition. The proceeds from the REO Disposition, net of any
payment to the Servicer as provided above, shall be deposited in the Collection
Account for distribution on the succeeding Servicer Remittance Date in
accordance with Section 4.01 and Section 4.02.
Any REO Disposition shall be for cash only (unless changes in
the REMIC Provisions made subsequent to the Startup Day allow a sale for other
consideration and an Opinion of Counsel is obtained by the Servicer to the
effect that such sale shall not cause any REMIC constituting part of the Trust
Fund to fail to qualify as a REMIC).
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements.
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
shall not exercise any such right if the "due-on-sale" clause, in the reasonable
belief of the Servicer, is not enforceable under applicable law. An Opinion of
Counsel at the expense of the Servicer (which expense shall constitute a
Servicing Advance) delivered to the Trustee and the Depositor to the foregoing
effect shall conclusively establish the reasonableness of such belief. In such
event, the Servicer shall make reasonable efforts to enter into an assumption
and modification agreement with the Person to whom such property has been or is
about to be conveyed, pursuant to which such Person becomes liable under the
Mortgage Note and, unless prohibited by applicable law or the Mortgage, the
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 Person, pursuant to which the original Mortgagor
is released from liability and such Person is substituted as Mortgagor and
becomes liable under the
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Note. The Mortgage Loan, as assumed, shall conform in all respects to the
requirements, representations and warranties of this Agreement. The Servicer
shall notify the Trustee that any such assumption or substitution agreement has
been completed by forwarding to the Trustee (or the Custodian, as the case may
be) the original copy of such assumption or substitution agreement (indicating
the Mortgage File to which it relates) which copy shall be added by the Trustee
(or the Custodian, as the case may be) 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 recording any such assumption or substitution
agreements. In connection with any such assumption or substitution agreement,
the Monthly Payment on the related Mortgage Loan shall not be changed but shall
remain as in effect immediately prior to the assumption or substitution, the
stated maturity or outstanding principal amount of such Mortgage Loan shall not
be changed nor shall any required monthly payments of principal or interest be
deferred or forgiven. Any fee collected by the Servicer 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 by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.
Section 3.15 Notification of Adjustments.
On each Adjustment Date, the Servicer shall make Mortgage
Interest Rate adjustments for each Adjustable-Rate Mortgage Rate Loan in
compliance with the requirements of the related Mortgage and Mortgage Note and
Applicable Regulations. The Servicer shall execute and deliver the notices
required by each Mortgage and Mortgage Note and Applicable Regulations regarding
Mortgage Interest Rate adjustments. The Servicer also shall provide timely
notification to the Trustee of all applicable data and information regarding
such Mortgage Interest Rate adjustments and the Servicer's methods of
implementing such Mortgage Interest Rate adjustments. Upon the discovery by the
Servicer or the Trustee that the Servicer has failed to adjust or has
incorrectly adjusted a Mortgage Interest Rate or a Monthly Payment pursuant to
the terms of the related Mortgage Note and Mortgage, the Servicer shall deliver
to the Trustee for deposit in the Distribution Account from its own funds the
amount of any interest loss caused thereby without reimbursement therefor;
provided, however, the Servicer shall be held harmless with respect to any
Mortgage Interest Rate adjustments made by any servicer prior to the Servicer.
Section 3.16 Optional Purchases of Mortgage Loans by Servicer.
The Servicer (or an affiliate of the Servicer) may, at its
option, repurchase a Mortgage Loan or REO Property which becomes 120 or more
days Delinquent or for which the Servicer has accepted a deed in lieu of
foreclosure, during the period commencing on the first day of the calendar
quarter succeeding the calendar quarter in which the Initial Delinquency Date
occurred with respect to such Mortgage Loan and ending on the last Business Day
of such
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calendar quarter. If the Servicer (or an affiliate of the Servicer) does not
exercise its purchase right with respect to a Mortgage Loan during the period
specified in the preceding sentence, such Mortgage Loan shall thereafter again
become eligible for purchase pursuant to the preceding sentence only after the
Mortgage Loan ceases to be 120 days or more Delinquent and thereafter becomes
120 days Delinquent again. The "Initial Delinquency Date" of a Mortgage Loan
shall mean the date on which the Mortgage Loan first became 120 days Delinquent.
Prior to repurchase pursuant to this Section 3.16, the Servicer shall be
required to continue to make monthly advances pursuant to Section 4.07. The
Servicer shall not use any procedure in selecting Mortgage Loans to be
repurchased which is materially adverse to the interests of the
Certificateholders. The Servicer shall purchase such (i) delinquent Mortgage
Loan at a price equal to the Principal Balance of the Mortgage Loan plus accrued
interest thereon at the Mortgage Interest Rate from the date to which interest
has last been paid to the Trust Fund to the date of purchase plus any
unreimbursed Servicing Advances and Advances or (ii) REO Property at its fair
market value as determined in good faith by the Servicer. Any such repurchase of
a Mortgage Loan or REO Property pursuant to this Section 3.16 shall be
accomplished by delivery to the Trustee for deposit in the Distribution Account
of the amount of the purchase price. The Trustee shall immediately effectuate
the conveyance of such delinquent Mortgage Loan or REO Property to the Servicer
to the extent necessary, including the prompt delivery of all documentation to
the Servicer.
Section 3.17 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
Trustee (or the Custodian as the case may be) two executed copies of a completed
"Request for Release" in the form of Exhibit E. Upon receipt of such Request for
Release of Documents, the Trustee (or the Custodian as the case may be) shall
promptly release the related Mortgage File, in trust to (i) the Servicer, or
(ii) such other party identified in the related Request for Release. Upon any
such payment in full, or the receipt of such notification that such funds have
been placed in escrow, the Servicer shall direct the Trustee in writing to
execute an instrument of satisfaction (or assignment of Mortgage without
recourse) regarding the Mortgaged Property relating to such Mortgage, which
instrument of satisfaction or assignment, as the case may be, shall be delivered
to the Person or Persons entitled thereto against receipt therefor of payment in
full, it being understood and agreed that no expense incurred in connection with
such instrument of satisfaction or assignment, as the case may be, shall be
chargeable to the Collection Account. In lieu of executing any such satisfaction
or assignment, as the case may be, 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.
(b) From time to time and as appropriate in the servicing of
any Mortgage Loan, including, without limitation, foreclosure or other
comparable conversion of a Mortgage Loan or collection under any insurance
policy relating to a Mortgage Loan, the Trustee shall (except in the case of the
payment or liquidation pursuant to which the related Mortgage File is
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released to an escrow agent or an employee, agent or attorney of the Trustee),
upon written request of the Servicer and delivery to the Trustee (or the
Custodian, as the case may be) of two executed copies of a "Request for Release"
in the form of Exhibit E signed by a Servicing Officer, release the related
Mortgage File to the Servicer and shall execute such documents as shall be
necessary to the prosecution of any such proceedings, including, without
limitation, an assignment without recourse, representation or warranty of the
related Mortgage to the Servicer. Such receipt shall obligate the Servicer to
return the Mortgage File to the Trustee (or the Custodian, as the case may be)
when the need therefor by the Servicer no longer exists unless the Mortgage Loan
shall be liquidated, in which case, upon receipt of a Request for Release
evidencing such liquidation, the receipt shall be released by the Trustee (or
the Custodian, as the case may be) to the Servicer.
(c) Subject to Section 3.01, the Servicer shall have the right
to accept applications of Mortgagors for consent to (i) partial releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division of properties
subject to Mortgages and (iv) second mortgage subordination agreements. No
application for approval shall be considered by the Servicer unless: (w) it has
received an Opinion of Counsel, addressed to the Trustee (which opinion shall
not be an expense of the Trustee or the Trust Fund) that such sale, disposition,
substitution, acquisition or contribution will not affect adversely the status
of any REMIC constituting part of the Trust Fund as a REMIC or cause any REMIC
constituting part of the Trust Fund to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions; (x) the
provisions of the related Note and Mortgage have been complied with; (y) the
Combined Loan-to-Value Ratio and debt-to-income ratio after any release does not
exceed the maximum Combined Loan-to-Value Ratio and debt-to-income ratio
established in accordance with the underwriting standards of the Mortgage Loans;
and (z) the lien priority of the related Mortgage is not affected. Upon receipt
by the Trustee of a Servicing Officer's certificate setting forth the action
proposed to be taken in respect of a particular Mortgage Loan and certifying
that the criteria set forth in the immediately preceding sentence have been
satisfied, the Trustee shall execute and deliver to the Servicer the consent or
partial release so requested by the Servicer. A proposed form of consent or
partial release, as the case may be, shall accompany any Servicing Officer's
certificate delivered by the Servicer pursuant to this paragraph.
Section 3.18 Servicing Compensation.
As compensation for its activities hereunder, the Servicer
shall be entitled to retain the amount of the Servicing Fee with respect to each
Mortgage Loan (including REO Properties). The Servicer shall be entitled to
retain additional servicing compensation in the form of release fees, bad check
charges, assumption fees, modification or extension fees, late payment charges,
customary real estate referral fees or any other service-related fees, Insurance
Proceeds and Liquidation Proceeds not required to be deposited in the Collection
Account and similar items, to the extent collected from Mortgagors.
Section 3.19 Annual Statement as to Compliance.
(a) The Servicer, at its own expense, will deliver to the
Trustee and the Depositor, not later than March 15th of each calendar year
commencing in 2005, a Servicing Officer's certificate stating, as to each signer
thereof, that (i) a review of the activities of the
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Servicer during such preceding calendar year (or such shorter period in the case
of the first such report) and of performance under this Agreement has been made
under such officers' supervision, and (ii) to the best of such officers'
knowledge, based on such review, the Servicer has fulfilled all its obligations
under this Agreement for such year, or, if there has been a default in the
fulfillment of all such obligations, specifying each such default known to such
officers and the nature and status thereof including the steps being taken by
the Servicer to remedy such default.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and their receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 3.20 Annual Independent Certified Public Accountants'
Reports.
(a) Not later than March 15th of each calendar year commencing
in 2005, the Servicer, at its expense, shall cause a nationally recognized firm
of independent certified public accountants to furnish to the Trustee and the
Depositor a report stating that (i) it has obtained a letter of representation
regarding certain matters from the management of the Servicer which includes an
assertion that the Servicer has complied with certain minimum residential
mortgage loan servicing standards, identified in either the Uniform Single
Attestation Program for Mortgage Bankers established by the Mortgage Bankers
Association of America or the Audit Program for Mortgages serviced by ▇▇▇▇▇▇▇
Mac, with respect to the servicing of residential mortgage loans during the most
recently completed calendar year and (ii) on the basis of an examination
conducted by such firm in accordance with standards established by the American
Institute of Certified Public Accountants, such representation is fairly stated
in all material respects, subject to such exceptions and other qualifications
that may be appropriate. Immediately upon receipt of such report, the Servicer
shall furnish a copy of such report to the Trustee, the Depositor and each
Rating Agency. Copies of such statement shall be provided by the Trustee to any
Certificateholder upon request at the Servicer's expense, provided that such
statement is delivered by the Servicer to the Trustee.
(b) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and its receipt of such shall not
constitute constructive notice of any information contained therein or
determinable, from information contained therein, including the Servicer's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 3.21 Access to Certain Documentation and Information
Regarding the Mortgage Loans.
The Servicer shall provide to the Trustee, Certificateholders
or Certificate Owners that are federally insured savings and loan associations,
the Office of Thrift Supervision, the FDIC and the supervisory agents and
examiners of each of the foregoing (which, in the case of supervisory agents and
examiners, may be required by applicable state and federal regulations) access
to the documentation regarding the Mortgage Loans, such access being afforded
without
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charge but only upon reasonable request and during normal business hours at the
offices of the Servicer designated by it.
Section 3.22 Commission Reporting.
(a) The Trustee and the Servicer shall reasonably cooperate
with the Depositor in connection with satisfying the reporting requirements
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The
Trustee shall prepare and file (via the Securities and Exchange Commission's
Electronic Data Gathering and Retrieval System) on behalf of the Trust Fund any
Forms 8-K and 10-K (and the Servicer shall sign any Form 10-K) customary for
similar securities as required by the Exchange Act and the Rules and Regulations
of the Securities and Exchange Commission thereunder.
(b) Each Form 8-K shall be filed by the Trustee within 15 days
after each Distribution Date, with a copy of the statement to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
March 30th of each year (or such earlier date as may be required by the Exchange
Act and the Rules and Regulations of the Securities and Exchange Commission),
the Trustee shall file a Form 10-K, in substance as required by applicable law
or applicable Security and Exchange Commission staff's interpretations. Such
Form 10-K shall include as exhibits the Servicer's annual statement of
compliance described under Section 3.19 and the accountant's report described
under Section 3.20, in each case to the extent they have been timely delivered
to the Trustee. The Trustee shall have no liability with respect to (a) any
failure to properly prepare or file such periodic reports resulting from or
relating to the Trustee's inability or failure to obtain any information not
resulting from its own negligence, willful misconduct or bad faith or (b) any
inaccuracy in such periodic reports resulting from incorrect information
provided to the Trustee by the Servicer in a Remittance Report or otherwise. The
Form 10-K shall also include a certification in the form attached hereto as
Exhibit O-1 (the "Certification"), which shall be signed by the senior officer
of the Servicer in charge of servicing.
(c) In addition, the Trustee shall sign a certification (in
the form attached hereto as Exhibit O-2) for the benefit of the Servicer and its
officers, directors and Affiliates regarding certain aspects of the
Certification (the "Trustee Certification") (provided, however, that the Trustee
shall not undertake an analysis of the accountant's report attached as an
exhibit to the Form 10-K). Such certification shall be delivered to the Servicer
no later than the 20th day prior to the latest date on which the Form 10-K is
permitted to be filed, without regard to extension (or if such day is not a
Business Day, the immediately preceding Business Day) and the Servicer shall
deliver the Certification to be filed to the Trustee no later than the 10th day
prior to the latest date on which the Form 10-K is permitted to be filed,
without regard to extension (or if such day is not a Business Day, the
immediately preceding Business Day).
In addition, (i) the Trustee shall, subject to the provisions
of Sections 8.01 and 8.02 hereof, indemnify and hold harmless the Depositor, the
Servicer and each of its officers, directors and Affiliates from and against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of or
based upon (a) a breach of the Trustee's obligations under this Section 3.22(b),
(b) the Trustee's negligence, bad faith or willful misconduct in connection
therewith or (c) any
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inaccuracy in the Trustee Certification and (ii) the Servicer shall indemnify
and hold harmless the Depositor, the Trustee and their respective officers,
directors and Affiliates from and against any actual losses, damages, penalties,
fines, forfeitures, reasonable and necessary legal fees and related costs,
judgments and other costs and expenses arising out of or based upon (a) the
failure of the Servicer to timely deliver the Certification or (b) any material
misstatement in the Certification. If the indemnification provided for herein is
unavailable or insufficient to hold harmless the Depositor, then (i) the Trustee
agrees that it shall contribute to the amount paid or payable by the Depositor
as a result of the losses, claims, damages or liabilities of the Depositor in
such proportion as is appropriate to reflect the relative fault of the Depositor
on the one hand and the Trustee on the other in connection with a breach of the
Trustee's obligations under this Section 3.22(b) or the Trustee's negligence,
bad faith or willful misconduct in connection therewith and (ii) the Servicer
agrees that it shall contribute to the amount paid or payable by the Depositor
as a result of the losses, claims, damages or liabilities of the Depositor in
such proportion as is appropriate to reflect the relative fault of the Depositor
on the one hand and the Servicer on the other in connection with a breach of the
Servicer's obligations under this Section 3.22(b) or the Servicer's negligence,
bad faith or willful misconduct in connection therewith.
(d) Upon any filing with the Securities and Exchange
Commission, the Trustee shall promptly deliver to the Depositor and the Servicer
a copy of any executed report, statement or information.
(e) Prior to January 30th of the first year in which the
Trustee is able to do so under applicable law, the Trustee shall file a Form 15
Suspension Notification with respect to the Trust Fund.
(f) To the extent that, following the Closing Date, the
Depositor certifies that reports and certifications differing from those
required under this Section 3.22 comply with the reporting requirements under
the Exchange Act, the Trustee and the Servicer hereby agree that they will
reasonably cooperate to amend the provisions of this Section 3.22 in order to
comply with such amended reporting requirements and such amendment of this
Section 3.22. Any such amendment may result in the reduction of the reports
filed by the Depositor under the Exchange Act. Notwithstanding the foregoing,
the parties hereto shall not be obligated to enter into any amendment pursuant
to this Section 3.22 that adversely affects its obligations and immunities under
this Agreement.
Section 3.23 Obligations of the Servicer in Respect of
Compensating Interest.
Not later than the close of business on each Servicer
Remittance Date, the Servicer shall deliver to the Trustee for deposit in the
Distribution Account an amount ("Compensating Interest") equal to the lesser of
(A) the aggregate of the Prepayment Interest Shortfalls on the Mortgage Loans
for the related Distribution Date resulting from Principal Prepayments in full
on the Mortgage Loans during the related Prepayment Period and (B) 50% of its
aggregate Servicing Fee received in the related Collection Period. Compensating
Interest shall be applied to offset any Prepayment Interest Shortfalls on the
Mortgage Loans. The Servicer shall not have the right to reimbursement for any
amounts remitted to the Trustee in respect of Compensating Interest. Such
amounts so remitted shall be included in the Available
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Funds and distributed therewith on the next Distribution Date. The Servicer
shall not be obligated to pay Relief Act Interest Shortfalls.
Section 3.24 Obligations of the Servicer in Respect of
Mortgage Interest Rates and Monthly Payments.
In the event that a shortfall in any collection on or
liability with respect to any Mortgage Loan results from or is attributable to
adjustments to Mortgage Interest Rates, Monthly Payments or Principal Balances
that were made by the Servicer in a manner not consistent with the terms of the
related Mortgage Note and this Agreement, the Servicer, upon discovery or
receipt of notice thereof, immediately shall deliver to the Trustee for deposit
in the Distribution Account from its own funds the amount of any such shortfall
and shall indemnify and hold harmless the Trust Fund, the Trustee, the Depositor
and any successor servicer in respect of any such liability. Such indemnities
shall survive the termination or discharge of this Agreement.
Section 3.25 Investment of Funds in the Collection Account and
the Distribution Account.
(a) The Servicer may direct any depository institution
maintaining the Collection Account (for purposes of this Section 3.25, an
"Investment Account"), to invest the funds in such Investment Account in one or
more Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if a Person other than the Trustee is the
obligor thereon, and (ii) no later than the date on which such funds are
required to be withdrawn from such account pursuant to this Agreement, if the
Trustee is the obligor thereon. All such Permitted Investments shall be held to
maturity, unless payable on demand. Any investment of funds in an Investment
Account shall be made in the name of the Trustee or the Servicer, as applicable
(in its capacity as such) or in the name of a nominee of the Trustee. The
Trustee shall be entitled to sole possession (except with respect to investment
direction of funds held in the Collection Account) over each such investment and
the income thereon, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the Trustee or its agent, together
with any document of transfer necessary to transfer title to such investment to
the Trustee or its nominee. In the event amounts on deposit in an Investment
Account are at any time invested in a Permitted Investment payable on demand,
the Trustee shall at the direction of the Servicer:
(x) consistent with any notice required to be given
thereunder, demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an amount equal
to the lesser of (1) all amounts then payable thereunder and (2) the
amount required to be withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly upon
determination by a Responsible Officer of the Trustee that such
Permitted Investment would not constitute a Permitted Investment in
respect of funds thereafter on deposit in the Investment Account.
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(b) All income and gain realized from the investment of funds
in the Collection Account shall be for the benefit of the Servicer. The Servicer
shall deposit in the Collection Account the amount of any loss incurred in
respect of any such Permitted Investment made with funds in such account
immediately upon realization of such loss.
(c) Except as otherwise expressly provided in this Agreement,
if any default occurs in the making of a payment due under any Permitted
Investment, or if a default occurs in any other performance required under any
Permitted Investment, the Trustee may and, subject to Section 8.01 and Section
8.02(a)(v), upon the request of the Holders of Certificates representing more
than 50% of the Voting Rights allocated to any Class of Certificates, shall take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate proceedings.
The Trustee shall not in any way be held liable by reason of
any insufficiency in any Account held by the Trustee resulting from any
investment loss on any Permitted Investment included therein (except to the
extent that the Trustee is the obligor and has defaulted thereon).
Section 3.26 Liability of Servicer; Indemnification.
(a) Subject to clause (b) below and Section 6.03, the Servicer
(except the Trustee if it is required to succeed the Servicer hereunder)
indemnifies and holds the Trustee, the Seller, the Depositor and each
Certificateholder harmless against any and all claims, losses, penalties, fines,
forfeitures, reasonable legal fees and related costs, judgments, and any other
costs, fees and expenses that the Trustee, the Depositor and any
Certificateholder may sustain in any way related to the failure of the Servicer
to perform its duties and service the Mortgage Loans in compliance with the
Servicing Standards. The Servicer shall immediately notify the Trustee, the
Depositor and each Certificateholder if a claim is made that may result in such
claims, losses, penalties, fines, forfeitures, legal fees or related costs,
judgments, or any other costs, fees and expenses, and the Servicer shall assume
(with the consent of the Trustee) the defense of any such claim and pay all
expenses in connection therewith, including reasonable counsel fees, and
promptly pay, discharge and satisfy any judgment or decree which may be entered
against the Servicer, the Trustee, the Depositor and/or Certificateholder in
respect of such claim. The provisions of this Section 3.26 shall survive the
termination of this Agreement and the payment of the outstanding Certificates.
(b) None of the Depositor, the Seller, the Servicer, or any of
the directors, officers, employees or agents of the Depositor, the Seller or the
Servicer 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, in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the
Seller or the Servicer or any such Person against any breach of warranties or
representations made herein, or against any specific liability imposed on the
Servicer for a breach of the Servicing Standard, or against any liability which
would otherwise be imposed by reason of its respective willful misfeasance, bad
faith, fraud or negligence in the performance of its duties or by reasons of
negligent disregard of its respective obligations or duties hereunder.
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The Depositor, the Servicer, the Seller and any director,
officer, employee or agent of the Depositor, the Seller or the Servicer, may
rely in good faith on any document of any kind which, prima facie, is properly
executed and submitted by any appropriate Person with respect to any matters
arising hereunder. The Depositor, the Servicer, the Seller, and any director,
officer, employee or agent of the Depositor, the Seller or the Servicer shall be
indemnified and held harmless by the Trust Fund against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement
or the Certificates, other than any loss, liability or expense incurred in
connection with any legal action incurred by reason of its respective
misfeasance, bad faith, fraud or negligence, a breach of a representation or
warranty hereunder or (in the case of the Servicer) a breach of the Servicing
Standard in the performance of its respective duties or by reason of negligent
disregard of its respective obligations or duties hereunder. Neither the
Depositor, the Seller nor the Servicer shall be under any obligation to appear
in, prosecute or defend any legal action unless such action is related to its
respective duties under this Agreement and in its opinion does not expose it to
any expense or liability; provided, however, that the Depositor, the Seller or
the Servicer may in its discretion undertake any action related to its
obligations hereunder which it may deem necessary or desirable with respect to
this Agreement and the rights and duties of the parties hereto and the interests
of the Certificateholders hereunder.
Section 3.27 Reports of Foreclosure and Abandonment of
Mortgaged Properties.
On or before the last day of February of each year beginning
in 2005, the Servicer shall file the reports of foreclosure and abandonment of
any Mortgaged Property required by Section 6050J of the Code with the Internal
Revenue Service and provide an Officer's Certificate certifying its compliance
with this Section 3.27 to the Trustee. The reports from the Servicer shall be in
form and substance sufficient to meet the reporting requirements imposed by such
Section 6050J.
Section 3.28 Protection of Assets.
(a) Except for transactions and activities entered into in
connection with the securitization that is the subject of this Agreement, the
Trust is not authorized and has no power to:
(1) borrow money or issue debt;
(2) merge with another entity, reorganize, liquidate or sell
assets; or
(3) engage in any business or activities.
(b) Each party to this Agreement agrees that it will not file an involuntary
bankruptcy petition against the Trustee or the Trust Fund or initiate any other
form of insolvency proceeding until after the Certificates have been paid.
Section 3.29 Net WAC Rate Carryover Reserve Account.
No later than the Closing Date, the Trustee shall establish
and maintain with itself a separate, segregated trust account titled, "Net WAC
Rate Carryover Reserve Account, U.S.
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Bank National Association, as Trustee, in trust for the registered Holders of
2004-CB7 Trust, C-BASS Mortgage Loan Asset-Backed Certificates, Series ▇▇▇▇-▇▇▇.
▇▇ each Distribution Date as to which there is a Net WAC Rate
Carryover Amount payable to the Offered Certificates and/or the Class B-4
Certificates, the Trustee has been directed by the Class X/N Certificateholders
to, and therefore shall, deposit into the Net WAC Rate Carryover Reserve Account
the amounts described in Section 4.02(B)(v) and (vi), rather than distributing
such amounts to the Class X/N Certificateholders. On each such Distribution
Date, the Trustee shall hold all such amounts for the benefit of the Holders of
the Class A Certificates and the Mezzanine Certificates, and shall distribute
such amounts to the Holders of the Class A Certificates and/or the Mezzanine
Certificates in the amounts and priorities set forth in Section 4.02(B).
For federal and state income tax purposes, the Class X/N
Certificateholders will be deemed to be the owners of the Net WAC Rate Carryover
Reserve Account and all amounts deposited into the Net WAC Rate Carryover
Reserve Account (other than amounts paid to the Net WAC Rate Carryover Reserve
Amount by the Cap Contracts) shall be treated as amounts distributed by REMIC 6
to the Holders of the Class X/N Certificates. Upon the termination of the Trust,
or the payment in full of the Offered Certificates and the Class B-2, Class B-3
and Class B-4 Certificates, all amounts remaining on deposit in the Net WAC Rate
Carryover Reserve Account shall be released by the Trust and distributed to the
Class X/N Certificateholders or their designees. The Net WAC Rate Carryover
Reserve Account shall be part of the Trust but not part of any REMIC and any
payments to the Holders of the Offered Certificates or the Class B-4
Certificates of Net WAC Rate Carryover Amounts shall not be payments with
respect to a "regular interest" in a REMIC within the meaning of Code Section
860(G)(a)(1).
By accepting a Class X/N Certificate, each Class X/N
Certificateholder hereby agrees to direct the Trustee, and the Trustee hereby is
directed, to deposit into the Net WAC Rate Carryover Reserve Account the amounts
described above on each Distribution Date as to which there is any Net WAC Rate
Carryover Amount rather than distributing such amounts to the Class X/N
Certificateholders. By accepting a Class X/N Certificate, each Class X/N
Certificateholder further agrees that such direction is given for good and
valuable consideration, the receipt and sufficiency of which is acknowledged by
such acceptance.
Amounts on deposit in the Net WAC Rate Carryover Reserve
Account shall remain uninvested.
For federal tax return and information reporting, the value of
the right of the (i) Group I Certificates, (ii) Group II Certificates, (iii)
Mezzanine Certificates (other than the Class B-2, Class B-3 and Class B-4
Certificates) and (iv) the Class B-2, Class B-3 and Class B-4 Certificates
Certificateholders to receive payments from the Net WAC Rate Carryover Reserve
Account in respect of any Net WAC Rate Carryover Amount shall be (i) $60,000.00,
(ii) $0.00, (iii) $70,000 and (iv) $0.00, respectively.
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Section 3.30 Advance Facility.
(a) The Servicer is hereby authorized to enter into a
financing or other facility (any such arrangement, an "Advance Facility"), the
documentation for which complies with Section 3.30(e) below, under which (1) the
Servicer assigns or pledges its rights under this Agreement to be reimbursed for
any or all Advances and/or Servicing Advances to (i) a Person, which may be a
special-purpose bankruptcy-remote entity (an "SPV"), (ii) a Person, which may
simultaneously assign or pledge such rights to an SPV or (iii) a lender (a
"Lender"), which, in the case of any Person or SPV of the type described in
either of the preceding clauses (i) or (ii), may directly or through other
assignees and/or pledgees, assign or pledge such rights to a Person, which may
include a trustee acting on behalf of holders of debt instruments (any such
Person or any such Lender, an "Advance Financing Person"), and/or (2) an Advance
Financing Person agrees to fund all the Advances and/or Servicing Advances
required to be made by the Servicer pursuant to this Agreement. No consent of
the Trustee, Certificateholders or any other party shall be required before the
Servicer may enter into an Advance Facility nor shall the Trustee or the
Certificateholders be a third party beneficiary of any obligation of an Advance
Financing Person to the Servicer. Notwithstanding the existence of any Advance
Facility under which an Advance Financing Person agrees to fund Advances and/or
Servicing Advances, (A) the Servicer (i) shall remain obligated pursuant to this
Agreement to make Advances and/or Servicing Advances pursuant to and as required
by this Agreement and (ii) shall not be relieved of such obligations by virtue
of such Advance Facility and (B) neither the Advance Financing Person nor any
Servicer's Assignee (as hereinafter defined) shall have any right to proceed
against or otherwise contact any Mortgagor for the purpose of collecting any
payment that may be due with respect to any related Mortgage Loan or enforcing
any covenant of such Mortgagor under the related Mortgage Loan documents.
(b) If the Servicer enters into an Advance Facility, the
Servicer and the related Advance Financing Person shall deliver to the Trustee
at the address set forth in Section 11.05 hereof a written notice (an "Advance
Facility Notice"), stating (a) the identity of the Advance Financing Person and
(b) the identity of the Person (the "Servicer's Assignee") that will, subject to
Section 3.30(c) hereof, have the right to make withdrawals from the Collection
Account pursuant to Section 3.05 hereof to reimburse previously unreimbursed
Advances and/or Servicing Advances ("Advance Reimbursement Amounts"). Advance
Reimbursement Amounts (i) shall consist solely of amounts in respect of Advances
and/or Servicing Advances for which the Servicer would be permitted to reimburse
itself in accordance with Section 3.05 hereof, assuming the Servicer had made
the related Advance(s) and/or Servicing Advance(s) and (ii) shall not consist of
amounts payable to a successor Servicer in accordance with Section 3.05 hereof
to the extent permitted under Section 3.30(e) below.
(c) Notwithstanding the existence of an Advance Facility, the
Servicer, on behalf of the Advance Financing Person, shall be entitled to
receive reimbursements of Advances and/or Servicing Advances in accordance with
Section 3.05 hereof, which entitlement may be terminated by the Advance
Financing Person pursuant to a written notice to the Trustee in the manner set
forth in Section 11.05 hereof. Upon receipt of such written notice, the Servicer
shall no longer be entitled to receive reimbursement for any Advance
Reimbursement Amounts and the Servicer's Assignee shall immediately have the
right to receive from the Collection Account all Advance Reimbursement Amounts.
Notwithstanding the foregoing, and for the avoidance of
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doubt, (i) the Servicer and/or the Servicer's Assignee shall only be entitled to
reimbursement of Advance Reimbursement Amounts hereunder pursuant to Section
3.05 of this Agreement and shall not otherwise be entitled to make withdrawals
of, or receive, Advance Reimbursement Amounts that shall be deposited in the
Distribution Account pursuant to Section 3.04(b) hereof, and (ii) none of the
Trustee or the Certificateholders shall have any right to, or otherwise be
entitled to, receive any Advance Reimbursement Amounts to which the Servicer or
Servicer's Assignee, as applicable, shall be entitled pursuant to Section 3.05
hereof. An Advance Facility may be terminated by the joint written direction of
the Servicer and the related Advance Financing Person. Written notice of such
termination shall be delivered to the Trustee in the manner set forth in Section
11.05 hereof. The Trustee shall have no duty or liability with respect to the
calculation of any Advance Reimbursement Amount and shall be entitled to rely
without independent investigation on the Advance Facility Notice and on such
Servicer's report of the amount of Advance Reimbursement Amounts and Servicing
Advance Reimbursement Amounts that were included in the remittance from such
Servicer to the Trustee pursuant to Section 4.07. Such Servicer shall maintain
and provide to any successor Servicer a detailed accounting on a loan-by-loan
basis as to amounts advanced by, pledged or assigned to, and reimbursed to any
Advance Financing Person. The successor Servicer shall be entitled to rely on
any such information provided by the predecessor Servicer, and the successor
Servicer shall not be liable for any errors in such information.
(d) [Reserved].
(e) As between a predecessor Servicer and its Advance
Financing Person, on the one hand, and a successor Servicer and its Advance
Financing Person, if any, on the other hand, Advance Reimbursement Amounts on a
loan-by-loan basis with respect to each Mortgage Loan as to which a Advance
and/or Servicing Advance shall have been made and be outstanding shall be
allocated on a "first-in, first out" basis. In the event the Servicer's Assignee
shall have received some or all of an Advance Reimbursement Amount related to
Advances and/or Servicing Advances that were made by a Person other than such
predecessor Servicer or its related Advance Financing Person in error, then such
Servicer's Assignee shall be required to remit any portion of such Advance
Reimbursement Amount to each Person entitled to such portion of such Advance
Reimbursement Amount. Without limiting the generality of the foregoing, the
Servicer shall remain entitled to be reimbursed by the Advance Financing Person
for all Advances and/or Servicing Advances funded by the Servicer to the extent
the related Advance Reimbursement Amounts have not been assigned or pledged to
such Advance Financing Person or Servicer's Assignee.
(f) For purposes of any certification of a Servicing Officer
of the Servicer made pursuant to Section 4.07(d), any Nonrecoverable Advance
referred to therein may have been made by the Servicer or any predecessor
Servicer. In making its determination that any Advance or Servicing Advance
theretofore made has become a Nonrecoverable Advance, the Servicer shall apply
the same criteria in making such determination regardless of whether such
Advance or Servicing Advance shall have been made by the Servicer or any
predecessor Servicer
(g) The Trustee shall not, as a result of the existence of any
Advance Facility, have any additional responsibility to track or monitor Advance
Reimbursement Amounts or any Advance Facility, and, except as expressly provided
in Section 3.30(c) above, is not and shall not
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be obligated to make any payment with respect to any Advance Reimbursement
Amount. The Servicer hereby indemnifies the Trustee, the Trust Fund and any
successor Servicer, as applicable, from and against any claims, losses,
liabilities or damages resulting from any claim by the related Advancing Person,
except to the extent that such claim, loss, liability or damage resulted from or
arose out of negligence, recklessness or willful misconduct on the part of the
Trustee or the successor Servicer, or failure by the successor Servicer or the
Trustee to remit funds as required by this Agreement or the commission of an act
or omission to act by the successor Servicer or the Trustee, and the passage of
any applicable cure or grace period, such that a Servicer Event of Termination
under this Agreement occurs or such entity is subject to termination for cause
under this Agreement
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ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions.
I. On each Distribution Date, the Trustee shall withdraw from
the Distribution Account the Group I Interest Remittance Amount and apply it in
the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Trustee may conclusively
rely):
(i) to the Trustee, the portion of the Trustee Fee related to
the Group I Mortgage Loans for such Distribution Date;
(ii) concurrently, to the Holders of the Group I Certificates,
on a PRO RATA basis based on the entitlement of each such Class, the applicable
Accrued Certificate Interest for such Distribution Date;
(iii) concurrently, to the Holders of the Group I
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Interest Carry Forward Amount for the Class AV-1 Certificates;
(iv) concurrently, to the Holders of the Group II
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Accrued Certificate Interest for such Classes for such
Distribution Date, to the extent remaining undistributed after the distribution
of the Group II Interest Remittance Amount as set forth in Section 4.01(II); and
(v) concurrently, to the Holders of the Group II Certificates,
on a PRO RATA basis based on the entitlement of each such Class, the applicable
Interest Carry Forward Amount for the Group II Certificates, to the extent
remaining undistributed after the distribution of the Group II Interest
Remittance Amount as set forth in Section 4.01(II).
II. On each Distribution Date, the Trustee shall withdraw from
the Distribution Account the Group II Interest Remittance Amount and apply it in
the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Trustee may conclusively
rely):
(i) to the Trustee, the portion of the Trustee Fee related to
the Group II Mortgage Loans for such Distribution Date;
(ii) concurrently, to the Holders of the Group II
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Accrued Certificate Interest for such Distribution Date;
(iii) concurrently, to the Holders of the Group II
Certificates, on a PRO RATA basis based on the entitlement of each such Class,
the applicable Interest Carry Forward Amount for the Group II Certificates;
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(iv) concurrently, to the Holders of the Group I Certificates,
on a PRO RATA basis based on the entitlement of each such Class, the applicable
Accrued Certificate Interest for such Class for such Distribution Date, to the
extent remaining undistributed after the distribution of the Group I Interest
Remittance Amount as set forth in Section 4.01(I); and
(v) concurrently, to the Holders of the Group I Certificates,
on a PRO RATA basis based on the entitlement of each such Class, the applicable
Interest Carry Forward Amount for the Group I Certificates, to the extent
remaining undistributed after the distribution of the Group I Interest
Remittance Amount as set forth in Section 4.01(I).
III. On each Distribution Date, the Trustee shall withdraw
from the Distribution Account the remaining Interest Remittance Amount and apply
it in the following order of priority (based upon the Mortgage Loan information
provided to it in the Remittance Report, upon which the Trustee may conclusively
rely):
(i) to the Holders of the Class M-1 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
(ii) to the Holders of the Class M-2 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
(iii) to the Holders of the Class M-3 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
(iv) to the Holders of the Class B-1 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
(v) to the Holders of the Class B-2 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
(vi) to the Holders of the Class B-3 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
(vii) to the Holders of the Class B-4 Certificates, the
Accrued Certificate Interest thereon for such Distribution Date;
and
(viii) the amount, if any, of the Interest Remittance Amount
remaining after application with respect to the priorities set
forth above will be applied as described under Section 4.02(B)
hereof.
With respect to any distributions to be made on the Class B-2
Certificates, the Class B-3 Certificates or the Class B-4 Certificates pursuant
to this Section 4.01, such distributions will be made first, on the Class B-2
Interest, the Class B-3 Interest or the Class B-4 Interest, as applicable, and
then, on the related Class of Certificates.
Section 4.02 Distributions of Principal and Monthly Excess
Cashflow Amounts.
(A) Distributions of Principal:
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I. On each Distribution Date (a) prior to the Stepdown Date or
(b) on which a Trigger Event is in effect, distributions in respect of principal
to the extent of the Group I Principal Remittance Amount will be made to the
Holders of the Group I Certificates (allocated among the Group I Certificates in
the priority described below), until the Certificate Principal Balances thereof
have been reduced to zero.
II. On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the Group II Principal Remittance Amount will be made
to the Holders of the Group II Certificates (allocated among the Group II
Certificates in the priority described below), until the Certificate Principal
Balances thereof have been reduced to zero.
III. On each Distribution Date (a) prior to the Stepdown Date
or (b) on which a Trigger Event is in effect, distributions in respect of
principal to the extent of the Principal Remittance Amount remaining
undistributed for such Distribution Date will be made in the following amounts
and order of priority:
(i) if, following the distribution of the Group I Principal
Remittance Amount as set forth in Section 4.02(A)(I), the Group I Enhancement
Amount is less than the Group I Targeted Enhancement Amount, to the Holders of
the Group I Certificates (allocated among the Group I Certificates in the
priority described below), until the Group I Enhancement Amount is equal to the
Group I Targeted Enhancement Amount;
(ii) if, following the distribution of the Group II Principal
Remittance Amount as set forth in Section 4.02(A)(II), the Group II Enhancement
Amount is less than the Group II Targeted Enhancement Amount, to the Holders of
the Group II Certificates (allocated among the Group II Certificates in the
priority described below), until the Group II Enhancement Amount is equal to the
Group II Targeted Enhancement Amount;
(iii) to the Holders of the Group I Certificates (allocated
among the Group I Certificates in the priority described below) and the Group II
Certificates (allocated among the Group II Certificates in the priority
described below), in that order, until the Certificate Principal Balances
thereof have been reduced to zero; and
(iv) sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates, in that
order, until the Certificate Principal Balances thereof have been reduced to
zero.
IV. On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the Group I Principal Remittance Amount shall be
made to the Holders of the Group I Certificates (allocated among the Group I
Certificates in the priority described below) in an amount equal to the Group I
Senior Principal Distribution Amount, until the Certificate Principal Balances
thereof have been reduced to zero.
V. On each Distribution Date (a) on or after the Stepdown Date
and (b) on which a Trigger Event is not in effect, distributions in respect of
principal to the extent of the Group II Principal Remittance Amount shall be
made to the Holders of the Group II Certificates
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(allocated among the Group II Certificates in the priority described below) in
an amount equal to the Group II Senior Principal Distribution Amount, until the
Certificate Principal Balances thereof have been reduced to zero.
VI. On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, distributions in respect
of principal to the extent of the Principal Remittance Amount (as reduced by the
amount of Overcollateralization Release Amount, if any) remaining undistributed
for such Distribution Date shall be made in the following amounts and order of
priority:
(i) if, following the distribution of the Group I Principal
Remittance Amount as set forth in Section 4.02(A)(IV), any portion of the Group
I Senior Principal Distribution Amount remains undistributed, to the Holders of
the Group I Certificates (allocated among the Group I Certificates in the
priority described below), until the Group I Senior Principal Distribution
Amount has been distributed in full;
(ii) if, following the distribution of the Group II Principal
Remittance Amount as set forth in Section 4.02(A)(V), any portion of the Group
II Senior Principal Distribution Amount remains undistributed, to the Holders of
the Group II Certificates (allocated among the Group II Certificates in the
priority described below), until the Group II Senior Principal Distribution
Amount has been distributed in full;
(iii) to the Holders of the Group I Certificates (allocated
among the Group I Certificates in the priority described below) and the Group II
Certificates (allocated among the Group II Certificates in the priority
described below), in that order, until the Senior Principal Distribution Amount
has been distributed in full; and
(iv) sequentially, to the Holders of the Class M-1, Class M-2,
Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates, the
related Subordinate Principal Distribution Amount, until the Certificate
Principal Balances thereof have been reduced to zero.
With respect to the Group I Certificates, all principal
distributions shall be distributed concurrently, on a PRO RATA basis (based on
(i) the Certificate Principal Balance of the Class AV-1 Certificates and (ii)
the aggregate Certificate Principal Balance of the Class AV-2A, Class AV-2B and
Class AV-2C Certificates, respectively) to (a) the Class AV-1 Certificates and
(b) sequentially, to the Class AV-2A, Class AV-2B and Class AV-2C Certificates,
in that order, until their respective Certificate Principal Balances have been
reduced to zero; provided, however, on any Distribution Date on which the
aggregate Certificate Principal Balance of the Mezzanine Certificates and the
Overcollateralization Amount has been reduced to zero, notwithstanding anything
contained herein to the contrary, all distributions of principal to the Group II
Certificates will be distributed concurrently, on a PRO RATA basis based on the
Certificate Principal Balance of each such Class.
With respect to the Group II Certificates, all principal
distributions will be distributed first, to the Holders of the Class AF-5
Certificates, the Lockout Distribution Percentage of such principal
distributions, until the Certificate Principal Balance of the Class AF-5
Certificates has been reduced to zero and second, sequentially, to the Holders
of the Class
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AF-1, Class AF-2, Class AF-3, Class AF-4 and Class AF-5 Certificates, in that
order, until their respective Certificate Principal Balances have been reduced
to zero; provided, however, on any Distribution Date on which the aggregate
Certificate Principal Balance of the Mezzanine Certificates and the
Overcollateralization Amount has been reduced to zero, notwithstanding anything
contained herein to the contrary, all distributions of principal to the Group I
Certificates will be distributed concurrently, on a PRO RATA basis based on the
Certificate Principal Balance of each such Class.
(B) On each Distribution Date, any Monthly Excess Cashflow
Amount shall be distributed, to the extent available, in the following order of
priority on such Distribution Date:
I. to the extent of the Extra Principal Distribution Amount:
(i) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(I) and Section 4.02(A)(III), the Group I
Enhancement Amount is less than the Group I Targeted Enhancement Amount, to the
Holders of the Group I Certificates (allocated among the Group I Certificates
the priority described under Section 4.02(A)), to the extent of the Group I
Senior Excess Interest Amount, until the Group I Enhancement Amount is equal to
the Group I Targeted Enhancement Amount and (B) if, on any Distribution Date
after the Stepdown Date on which a Trigger Event is not in effect, following the
distribution of the Principal Remittance Amount as set forth in Section
4.02(A)(IV) and Section 4.02(A)(VI), any portion of the Group I Senior Principal
Distribution Amount remains undistributed, to the Holders of the Group I
Certificates (allocated among the Group I Certificates the priority described
under Section 4.02(A)), to the extent of the Group I Senior Excess Interest
Amount, until the Group I Senior Principal Distribution Amount has been
distributed in full;
(ii) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(II) and Section 4.02(A)(III), the Group II
Enhancement Amount is less than the Group II Targeted Enhancement Amount, to the
Holders of the Group II Certificates (allocated among the Group II Certificates
in the priority described under Section 4.02(A)), to the extent of the Group II
Senior Excess Interest Amount, until the Group II Enhancement Amount is equal to
the Group II Targeted Enhancement Amount and (B) if, on any Distribution Date
after the Stepdown Date on which a Trigger Event is not in effect, following the
distribution of the Principal Remittance Amount as set forth in Section
4.02(A)(V) and Section 4.02(A)(VI), any portion of the Group II Senior Principal
Distribution Amount remains undistributed, to the Holders of the Group II
Certificates (allocated among the Group II Certificates in the priority
described under Section 4.02(A)), to the extent of the Group II Senior Excess
Interest Amount, until the Group II Senior Principal Distribution Amount has
been distributed in full;
(iii) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(I) and Section
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4.02(A)(III) and the distribution in Section 4.02(B)(I)(i), the Group I
Enhancement Amount is less than the Group I Targeted Enhancement Amount, to the
Holders of the Group I Certificates (allocated among the Group I Certificates
the priority described under Section 4.02(A)), until the Group I Enhancement
Amount is equal to the Group I Targeted Enhancement Amount and (B) if, on any
Distribution Date after the Stepdown Date on which a Trigger Event is not in
effect, following the distribution of the Principal Remittance Amount as set
forth in Section 4.02(A)(IV) and Section 4.02(A)(VI) and the distribution in
Section 4.02(B)(I)(i), any portion of the Group I Senior Principal Distribution
Amount remains undistributed, to the Holders of the Group I Certificates
(allocated among the Group I Certificates the priority described under Section
4.02(A)) until the Group I Senior Principal Distribution Amount has been
distributed in full;
(iv) (A) if, on any Distribution Date prior to the Stepdown
Date or any Distribution Date after the Stepdown Date on which a Trigger Event
is in effect, following the distribution of the Principal Remittance Amount as
set forth in Section 4.02(A)(II) and Section 4.02(A)(III) and the distribution
in Section 4.02(B)(I)(ii) above, the Group II Enhancement Amount is less than
the Group II Targeted Enhancement Amount, to the Holders of the Group II
Certificates (allocated among the Group II Certificates in the priority
described under Section 4.02(A)), until the Group II Enhancement Amount is equal
to the Group II Targeted Enhancement Amount and (B) if, on any Distribution Date
after the Stepdown Date on which a Trigger Event is not in effect, following the
distribution of the Principal Remittance Amount as set forth in Section
4.02(A)(V) and Section 4.02(A)(VI) and the distribution in Section
4.02(B)(I)(ii), any portion of the Group II Senior Principal Distribution Amount
remains undistributed, to the Holders of the Group II Certificates (allocated
among the Group II Certificates in the priority described under Section
4.02(A)), until the Group II Senior Principal Distribution Amount has been
distributed in full;
(v) (A) on any Distribution Date prior to the Stepdown Date or
any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, to the Holders of the Group I Certificates (allocated among the Group I
Certificates in the priority described under Section 4.02(A)) and the Group II
Certificates (allocated among the Group II Certificates the priority described
under Section 4.02(A)), in that order, until the Certificate Principal Balances
thereof have been reduced to zero and (B) on any Distribution Date after the
Stepdown Date on which a Trigger Event is not in effect, to the Holders of the
Group I Certificates (allocated among the Group I Certificates in the priority
described under Section 4.02(A)) and the Group II Certificates (allocated among
the Group II Certificates the priority described under Section 4.02(A)), in that
order, until the Senior Principal Distribution Amount has been distributed in
full; and
(vi) (A) on any Distribution Date prior to the Stepdown Date
or any Distribution Date after the Stepdown Date on which a Trigger Event is in
effect, sequentially, to the Holders of the Class M-1, Class M-2, Class M-3,
Class B-1, Class B-2, Class B-3 and Class B-4 Certificates, in that order, until
the Certificate Principal Balances thereof have been reduced to zero and (B) if,
on any Distribution Date after the Stepdown Date on which a Trigger Event is not
in effect, following the distributions in Section 4.02(A)(VI), any portion of
the related Subordinate Principal Distribution Amount remains undistributed, to
the Holders of the Class M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class
B-3 and Class B-4 Certificates, until the related Subordinate Principal
Distribution Amount has been distributed in full;
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II. to the extent of any remaining Monthly Excess Cashflow
Amount:
(i) sequentially, to fund the Interest Carry Forward Amount
for the Class M-1, Class M-2, Class M-3, Class B-1, Class B-2, Class B-3 and
Class B-4 Certificates, in that order, if any;
(ii) to each Class of Class A Certificates, on a PRO RATA
basis based on the Certificate Principal Balance of each such Class (after
taking into account all distributions of principal to the Class A Certificates
on such Distribution Date), to fund the Class A Realized Loss Amortization
Amount for such Distribution Date;
(iii) sequentially, to fund (a) the Class M-1 Realized Loss
Amortization Amount, (b) Class M-2 Realized Loss Amortization Amount, (c) Class
M-3 Realized Loss Amortization Amount, (d) Class B-1 Realized Loss Amortization
Amount, (e) Class B-2 Realized Loss Amortization Amount, (f) Class B-3 Realized
Loss Amortization Amount and (g) Class B-4 Realized Loss Amortization Amount, in
that order, for such Distribution Date;
(iv) to the Net WAC Rate Carryover Reserve Account for
distribution to the Offered Certificates and the Mezzanine Certificates, the
aggregate amount of any Net WAC Rate Carryover Amount, after taking into account
amounts received under the Cap Contracts;
(v) from amounts distributed on the Class X/N Certificates, to
the Class N Certificates, (A) the Accrued Certificate Interest for the Class N
Certificates, (B) the unpaid Interest Carry Forward Amount for the Class N
Certificates and (C) any remaining Monthly Excess Cashflow Amount to reduce the
Class N Notional Amount, until the Class N Notional Amount has been reduced to
zero;
(vi) from amounts distributed on the Class X/N Certificates,
to the Class X Certificates, the Class X Distributable Amount for such
Distribution Date; and
(vii) any remaining amounts to the Holders of the Residual
Certificates (in respect of the Class R-1 Interest, the Class R-2 Interest, the
Class R-3 Interest, the Class R-4 Interest, the Class R-5 Interest and the Class
R-6 Interest, as applicable).
Following the foregoing distributions, an amount equal to the
amount of Subsequent Recoveries deposited into the Collection Account pursuant
to Section 3.04(a) shall be applied to increase the Certificate Principal
Balance of the Class of Certificates with the Highest Priority up to the extent
of such Realized Losses previously allocated to that Class of Certificates
pursuant to Section 4.03. An amount equal to the amount of any remaining
Subsequent Recoveries shall be applied to increase the Certificate Principal
Balance of the Class of Certificates with the next Highest Priority, up to the
amount of such Realized Losses previously allocated to that Class of
Certificates pursuant to Section 4.03. Holders of such Certificates will not be
entitled to any distribution in respect of interest on the amount of such
increases for any Interest Accrual Period preceding the Distribution Date on
which such increase occurs. Any such increases shall be applied to the
Certificate Principal Balance of each Certificate of such Class in accordance
with its respective Percentage Interest.
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With respect to any distributions to be made on the Class B-2
Certificates, the Class B-3 Certificates, the Class B-4 Certificates, the Class
N Certificates or the Class X Certificates pursuant to this Section 4.02, such
distributions will be made first, on the Class B-2 Interest, the Class B-3
Interest, the Class B-4 Interest or the Class X/N Interest, as applicable, and
then, on the related Class of Certificates.
(C) On each Distribution Date, all Prepayment Charges
(including amounts deposited in connection with the full or partial waiver of
such Prepayment Charges pursuant to Section 3.01) shall be allocated to the
Class N Certificates in the priority set forth under Section 4.02(B)(xxix) for
so long as the Notional Amount of the Class N Certificates is greater than zero,
and to the Class X Certificates after the Class N Notional Amount has been
reduced to zero.
(D) On each Distribution Date, after making the distributions
of the Available Funds as set forth above, the Trustee will withdraw from the
Net WAC Rate Carryover Reserve Account, to the extent of amounts remaining on
deposit therein, the amount of any Net WAC Rate Carryover Amount for such
Distribution Date and distribute such amount in the following order of priority:
(1) any amounts received by the Trustee in respect of the Cap
Contract related to the Group I Certificates shall be distributed to
the Group I Certificates, on a PRO RATA basis based on the Net WAC
Rate Carryover Amount for each such Class, to the extent of the Net
WAC Rate Carryover Amount for such Class for such Distribution Date;
(2) any amounts received by the Trustee in respect of the Cap
Contract related to the Class AF-1 Certificates shall be distributed
to the Class AF-1 Certificates to the extent of the Net WAC Rate
Carryover Amount for such Class for such Distribution Date;
(3) any amounts received by the Trustee in respect of the Cap
Contract related to the Mezzanine Certificates shall be distributed to
the Mezzanine Certificates, on a PRO RATA basis based on the Net WAC
Rate Carryover Amount for each such Class, to the extent of the Net
WAC Rate Carryover Amount for each such Class for such Distribution
Date;
(4) any remaining amounts paid under the Cap Contracts (to the
extent not distributed pursuant to (1), (2) or (3) above) and amounts
deposited in the Net WAC Rate Carryover Reserve Account from the
Monthly Excess Cashflow Amount shall be distributed as follows, in
each case to the extent of the applicable Net WAC Rate Carryover
Amount:
(a) concurrently, to each Class of Class A
Certificates, on a PRO RATA basis based on the Net WAC Rate
Carryover Amount for each such Class; and
(b) sequentially, to the Class M-1 Certificates, the
Class M-2 Certificates, the Class M-3 Certificates, the Class
B-1 Certificates, the Class B-2 Certificates, the Class B-3
Certificates and the Class B-4 Certificates, in that
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order, to the extent of any remaining Net WAC Rate Carryover
Amount for such Class.
Section 4.03 Allocation of Losses.
(a) All Realized Losses on the Mortgage Loans allocated to any
Regular Certificate shall be allocated by the Trustee on each Distribution Date
as follows: first, to the Accrued Certificate Interest on the Class X/N Interest
as provided in Section 1.03 (after the allocation thereto of any Prepayment
Interest Shortfalls or Relief Act Interest Shortfalls as provided in Section
1.03); second, to the Overcollateralization Amount, until the
Overcollateralization Amount has been reduced to zero; third, to the Class B-4
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; fourth, to the Class B-3 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; fifth, to the Class B-2 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero; sixth,
to the Class B-1 Certificates, until the Certificate Principal Balance thereof
has been reduced to zero; seventh, to the Class M-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero; eighth, to the
Class M-2 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero, ninth, to the Class M-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero and tenth, to each Class of
Class A Certificates, on a PRO RATA basis based on the Certificate Principal
Balance of each such Class, until the Certificate Principal Balances thereof
have been reduced to zero. All Realized Losses to be allocated to the
Certificate Principal Balances of all Classes on any Distribution Date shall be
so allocated after the actual distributions to be made on such date as provided
above. All references above to the Certificate Principal Balance of any Class of
Certificates shall be to the Certificate Principal Balance of such Class
immediately prior to the relevant Distribution Date, before reduction thereof by
any Realized Losses, in each case to be allocated to such Class of Certificates,
on such Distribution Date.
Any allocation of Realized Losses to a Class A Certificate and
a Mezzanine Certificate on any Distribution Date shall be made by reducing the
Certificate Principal Balance thereof by the amount so allocated.
(b) (i) The REMIC 1 Marker Percentage of all Realized Losses
on the Mortgage Loans shall be allocated by the Trustee on each Distribution
Date to the following REMIC 1 Regular Interests in the specified percentages, as
follows: first, to Uncertificated Accrued Interest payable to REMIC 1 Regular
Interest LT1AA and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount
equal to the REMIC 1 Interest Loss Allocation Amount, 98% and 2%, respectively;
second, to the Uncertificated Principal Balances of REMIC 1 Regular Interest
LT1AA and REMIC 1 Regular Interest LT1ZZ up to an aggregate amount equal to the
REMIC 1 Principal Loss Allocation Amount, 98% and 2%, respectively; third, to
the Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1B4 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1B4 has been reduced to zero; fourth, to the Uncertificated Principal
Balances of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1B3 and
REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B3 has been
reduced to zero; fifth, to the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AA,
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REMIC 1 Regular Interest LT1B2 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and
1%, respectively, until the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1B2 has been reduced to zero; sixth to the Uncertificated Principal
Balances of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1B1 and
REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1B1 has been
reduced to zero; seventh, to the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AA, REMIC 1 Regular Interest LT1M3 and REMIC 1 Regular
Interest LT1ZZ, 98%, 1% and 1%, respectively, until the Uncertificated Principal
Balance of REMIC 1 Regular Interest LT1M3 has been reduced to zero; eighth to
the Uncertificated Principal Balances of REMIC 1 Regular Interest LT1AA, REMIC 1
Regular Interest LT1M2 and REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Principal Balance of REMIC 1 Regular
Interest LT1M2 has been reduced to zero; ninth to the Uncertificated Principal
Balances of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular Interest LT1M1 and
REMIC 1 Regular Interest LT1ZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Principal Balance of REMIC 1 Regular Interest LT1M1 has been
reduced to zero and tenth, to the Uncertificated Principal Balances of REMIC 1
Regular Interest LT1AA, 98%, REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular
Interest LT1AV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular Interest
LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC
1 Regular Interest LT1AF3, REMIC 1 Regular Interest LT1AF4 and REMIC 1 Regular
Interest LT1AF5, 1% on a PRO RATA basis and REMIC 1 Regular Interest LT1ZZ, 1%,
respectively, until the Uncertificated Principal Balances of REMIC 1 Regular
Interest LT1AV1, REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular Interest
LT1AV2B, REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular Interest LT1AF1,
REMIC 1 Regular Interest LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1
Regular Interest LT1AF4 and REMIC 1 Regular Interest LT1AF5 have been reduced to
zero.
(ii) The REMIC 1 Sub WAC Allocation Percentage of all Realized
Losses shall be applied after all distributions have been made on each
Distribution Date first, so as to keep the Uncertificated Principal Balance of
each REMIC 1 Regular Interest ending with the designation "GRP" equal to 0.01%
of the aggregate Principal Balance of the Mortgage Loans in the related Loan
Group; second, to each REMIC 1 Regular Interest ending with the designation
"SUB," so that the Uncertificated Principal Balance of each such REMIC 1 Regular
Interest is equal to 0.01% of the excess of (x) the aggregate Principal Balance
of the Mortgage Loans in the related Loan Group over (y) the current Certificate
Principal Balance of the Class A Certificate in the related Loan Group (except
that if any such excess is a larger number than in the preceding distribution
period, the least amount of Realized Losses shall be applied to such REMIC 1
Regular Interests such that the REMIC 1 Subordinated Balance Ratio is
maintained); and third, any remaining Realized Losses shall be allocated to
REMIC 1 Regular Interest LT1XX.
(c) Special Hazard Losses will be allocated as described
above, except that if the aggregate amount of such losses, as of any date of
determination, exceeds the greatest of (i) 1.0% of the Principal Balance of the
Mortgage Loans as of the Cut-off Date, (ii) two times the amount of the
Principal Balance of the largest Mortgage Loan as of the date of determination
and (iii) an amount equal to the current Principal Balances of the Mortgage
Loans in the largest zip-code concentration in the State of California as of the
date of determination, such excess losses will be allocated among all the
outstanding Classes of Certificates, including the Class B-2
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Interest, the Class B-3 Interest, the Class B-4 Interest and the Class X/N
Interest, PRO RATA, based on their respective Certificate Principal Balances or
Notional Amount, as applicable.
Section 4.04 Method of Distribution.
The Trustee shall make distributions in respect of a
Distribution Date to each Certificateholder of record on the related Record Date
(other than as provided in Section 10.01 respecting the final distribution), in
the case of Certificateholders of the Certificates, by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Trustee in writing at least five Business
Days prior to the Record Date immediately prior to such Distribution Date and is
the registered owner of such Certificates the aggregate initial Certificate
Principal Balance or Notional Amount of which is in excess of $5,000,000, or by
check mailed by first class mail to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, provided that
the Trustee may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Distributions among Certificateholders shall be made in
proportion to the Percentage Interests evidenced by the Certificates held by
such Certificateholders.
Section 4.05 Distributions on Book-Entry Certificates.
Each distribution with respect to a Book-Entry Certificate
shall be paid to the Depository, which shall credit the amount of such
distribution to the accounts of its Depository Participants in accordance with
its normal procedures. Each Depository Participant shall be responsible for
disbursing such distribution to the Certificate Owners that it represents and to
each indirect participating brokerage firm (a "brokerage firm" or "indirect
participating firm") for which it acts as agent. Each brokerage firm shall be
responsible for disbursing funds to the Certificate Owners that it represents.
All such credits and disbursements with respect to a Book Entry Certificate are
to be made by the Depository and the Depository Participants in accordance with
the provisions of the Certificates. None of the Trustee, the Depositor, the
Servicer or the Seller shall have any responsibility therefor except as
otherwise provided by applicable law.
Section 4.06 Statements.
(a) On each Distribution Date, based, as applicable, on the
Mortgage Loan information contained in the Remittance Report, the Trustee shall
(i) prepare and forward by mail to each Holder of the Regular Certificates and
(ii) make available on its website at ▇▇▇.▇▇▇▇▇▇.▇▇▇/▇▇▇ for access by each
Holder of the Regular Certificates, a statement as to the distributions made on
such Distribution Date:
(i) the amount of the distribution made on such Distribution Date
to the Holders of each Class of Certificates allocable to principal or
reduction of Notional Amount, separately identified;
(ii) the amount of the distribution made on such Distribution
Date to the Holders of each Class of Certificates allocable to
interest or Class X Distributable Amount, separately identified;
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(iii) the Overcollateralization Amount, the Overcollateralization
Release Amount, the Overcollateralization Deficiency and the
Overcollateralization Target Amount as of such Distribution Date and
the Monthly Excess Interest Amount and Monthly Excess Cashflow Amount
for such Distribution Date;
(iv) [reserved];
(v) the aggregate amount of Advances for the related Collection
Period;
(vi) the Pool Balance at the close of business at the end of the
related Collection Period;
(vii) the number, weighted average remaining term to maturity and
weighted average Mortgage Interest Rate of the Mortgage Loans as of
the related Due Date;
(viii) the number and aggregate unpaid Principal Balance of
Mortgage Loans (a) 30 to 59 days past due on a contractual basis, (b)
60 to 89 days past due on a contractual basis, (c) 90 or more days
past due on a contractual basis, (d) as to which foreclosure
proceedings have been commenced and (e) in bankruptcy as of the close
of business on the last day of the calendar month preceding such
Distribution Date;
(ix) with respect to any Mortgage Loan that became an REO
Property during the preceding calendar month, the loan number of such
Mortgage Loan, the unpaid principal balance and the Principal Balance
of such Mortgage Loan as of the date it became an REO Property;
(x) the book value of any REO Property as of the close of
business on the last Business Day of the calendar month preceding the
Distribution Date, and, cumulatively, the total number and cumulative
principal balance of all REO Properties as of the close of business of
the last day of the preceding Collection Period;
(xi) the aggregate amount of Principal Prepayments made during
the related Prepayment Period;
(xii) the aggregate amount of Prepayment Charges collected
(including amounts deposited in connection with the full or partial
waiver of such Prepayment Charges pursuant to Section 3.01) during the
related Collection Period and the amounts thereof allocable to the
Class N Certificates and the Class X Certificates;
(xiii) the aggregate amount of Realized Losses incurred during
the related Collection Period and the cumulative amount of Realized
Losses;
(xiv) the Certificate Principal Balance or Notional Amount, as
applicable, of each Class of Certificates, after giving effect to the
distributions, and allocations of Realized Losses or Applied Realized
Loss Amounts, as applicable, made on such Distribution Date,
separately identifying any reduction thereof due to allocations of
Realized Losses or Applied Realized Loss Amounts;
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(xv) the Accrued Certificate Interest in respect of each Class of
Class A Certificates and the Mezzanine Certificates for such
Distribution Date, and the respective portions thereof, if any,
remaining unpaid following the distributions made in respect of such
Certificates on such Distribution Date and the amount of any Net WAC
Rate Carryover Amounts;
(xvi) the aggregate amount of any Prepayment Interest Shortfalls
for such Distribution Date, to the extent not covered by payments by
the Servicer pursuant to Section 3.23;
(xvii) the amount of the Trustee Fee paid;
(xviii) the Net WAC Rate Carryover Amounts distributed on such
Distribution Date and the amounts remaining after giving effect to
distributions thereof on such Distribution Date;
(xix) any Overcollateralization Deficiency after giving effect to
the distribution of principal on such Distribution Date;
(xx) whether a Trigger Event has occurred and is continuing, and
the cumulative Realized Losses, as a percentage of the original Pool
Balance;
(xxi) the Available Funds;
(xxii) the rate at which interest accrues for each Class of
Certificates for such Distribution Date;
(xxiii) the Liquidation Report for such Distribution Date;
(xxiv) the aggregate Principal Balance of Mortgage Loans
purchased by the Servicer or Seller during the related Collection
Period and indicating the Section of this Agreement requiring or
allowing the purchase of each such Mortgage Loan; and
(xxv) the aggregate Principal Balance of the Mortgage Loans
repurchased by the Servicer (or an affiliate) during the related
Collection Period in connection with Section 3.16.
The Trustee may fully rely upon and shall have no liability
with respect to information with respect to the Mortgage Loans provided by the
Servicer.
In the case of information furnished pursuant to subclauses
(i) through (iii) above, the amounts shall be expressed in a separate section of
the report as a dollar amount for each Class for each $1,000 original dollar
amount as of the Cut-off Date.
(b) Within a reasonable period of time after the end of each
calendar year, the Trustee shall furnish to each Person who at any time during
the calendar year was a Certificateholder of a Regular Certificate, if requested
in writing by such Person, such information as is reasonably necessary to
provide to such Person a statement containing the
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information set forth in subclauses (i), (ii), (xv) and (xx) above, aggregated
for such calendar year or applicable portion thereof during which such Person
was a Certificateholder. Such obligation of the Trustee shall be deemed to have
been satisfied to the extent that substantially comparable information shall be
prepared and furnished by the Trustee to Certificateholders pursuant to any
requirements of the Code as are in force from time to time.
(c) On each Distribution Date, the Trustee shall forward to
the Residual Certificateholders a copy of the reports forwarded to the Regular
Certificateholders in respect of such Distribution Date with such other
information as the Trustee deems necessary or appropriate. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be prepared and furnished to Residual
Certificateholders by the Trustee pursuant to any requirements of the Code as
from time to time in force.
Section 4.07 Remittance Reports; Advances.
(a) On the second Business Day following each Determination
Date but in no event less than four Business Days prior to the related
Distribution Date, the Servicer shall deliver to the Trustee by telecopy (or by
such other means as the Servicer and the Trustee may agree from time to time) a
Remittance Report with respect to the related Distribution Date. On the same
date, the Servicer shall forward to the Trustee by overnight mail a computer
readable magnetic tape or diskette or in such other medium as may be agreed
between the Servicer and the Trustee containing the information set forth in
such Remittance Report with respect to the related Distribution Date. Not later
than the close of business New York time on the Servicer Remittance Date, the
Servicer shall deliver or cause to be delivered to the Trustee in addition to
the information provided on the Remittance Report, such other information
reasonably available to it with respect to the Mortgage Loans as the Trustee may
reasonably request or order in order for the Trustee to perform the calculations
necessary to make the distributions contemplated by Section 4.01, 4.02 and 4.03
and to prepare the statements to Certificateholders contemplated by Section
4.06. The Trustee shall not be responsible to recompute, recalculate or verify
any information provided to it by the Servicer.
(b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.07(d), (i) the aggregate
amount of Monthly Payments (net of the related Servicing Fee and other than the
portion of the Monthly Payment representing principal on any second lien
Mortgage Loan), due during the related Collection Period in respect of the
Actuarial Mortgage Loans, which Monthly Payments were delinquent on a
contractual basis as of the close of business on the related Determination Date
and (ii) with respect to each REO Property, which REO Property was acquired
during or prior to the related Prepayment Period and as to which such REO
Property an REO Disposition did not occur during the related Prepayment Period,
an amount equal to the excess, if any, of only the interest portion of the
Monthly Payments (net of the related Servicing Fee) that would have been due on
the related Due Date in respect of the related Mortgage Loans, over the net
income from such REO Property deposited in the Collection Account pursuant to
Section 3.13 for distribution on such Distribution Date. For purposes of the
preceding sentence, the Monthly Payment on each Balloon Mortgage Loan with a
delinquent Balloon Payment is equal to the assumed monthly
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payment that would have been due on the related Due Date based on the original
principal amortization schedule for the such Balloon Mortgage Loan.
On or before the close of business New York time on the
Servicer Remittance Date, the Servicer shall remit in immediately available
funds to the Trustee for deposit in the Distribution Account an amount equal to
the aggregate amount of Advances, if any, to be made in respect of the Mortgage
Loans and REO Properties for the related Distribution Date either (i) from its
own funds or (ii) from the Collection Account, to the extent of funds held
therein for future distribution (in which case it will cause to be made an
appropriate entry in the records of the Collection Account that amounts held for
future distribution have been, as permitted by this Section 4.07, used by the
Servicer in discharge of any such Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of Advances to be made
by the Servicer with respect to the Mortgage Loans and REO Properties. In
addition, the Servicer shall have the right to reimburse itself for any Advances
previously made from the Collection Account, to the extent of funds held therein
for future distribution. Any amounts held for future distribution and so used
shall be appropriately reflected in the Servicer's records and replaced by the
Servicer by deposit in the Collection Account on or before any future Servicer
Remittance Date to the extent that the Available Funds for the related
Distribution Date (determined without regard to Advances to be made on the
Servicer Remittance Date) shall be less than the total amount that would be
distributed to the Classes of Certificateholders pursuant to Section 4.01 and
4.02 on such Distribution Date if such amounts held for future distributions had
not been so used to make Advances. The Trustee will provide notice to the
Servicer by telecopy by the close of business on any Servicer Remittance Date in
the event that the amount remitted by the Servicer to the Trustee on such date
is less than the Advances required to be made by the Servicer for the related
Distribution Date, as set forth in the related Remittance Report.
(c) The obligation of the Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until the earlier of such time as such Mortgage Loan is paid in full by
the Mortgagor or disposed of by the Trust, or until the recovery of all
Liquidation Proceeds thereon.
(d) Notwithstanding anything herein to the contrary, no
Advance or Servicing Advance shall be required to be made hereunder by the
Servicer if such Advance would, if made, constitute a Nonrecoverable Advance.
The determination by the Servicer that it has made a Nonrecoverable Advance or
that any proposed Advance, if made, would constitute a Nonrecoverable Advance,
shall be evidenced by an Officers' Certificate of the Servicer delivered to the
Depositor and the Trustee.
Section 4.08 REMIC Distributions.
(a) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 1
to REMIC 2 on account of the REMIC 1 Regular Interests or withdrawn from the
Distribution Account and distributed to the Holders of the Class R Certificates
(in respect of the Class R-1 Interest), as the case may be:
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(i) to Holders of REMIC 1 Regular Interest LT1AA, REMIC 1 Regular
Interest LT1AV1, REMIC 1 Regular Interest LT1AV2A, REMIC 1 Regular
Interest LT1AV2B, REMIC 1 Regular Interest LT1AV2C, REMIC 1 Regular
Interest LT1AF1, REMIC 1 Regular Interest LT1AF2, REMIC 1 Regular
Interest LT1AF3, REMIC 1 Regular Interest LT1AF4, REMIC 1 Regular
Interest LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular
Interest LT1M2, REMIC 1 Regular Interest LT1M3, REMIC 1 Regular
Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular
Interest LT1B3, REMIC 1 Regular Interest LT1B4 and REMIC 1 Regular
Interest LT1ZZ, PRO RATA, in an amount equal to (A) the Uncertificated
Accrued Interest for such Distribution Date, plus (B) any amounts in
respect thereof remaining unpaid from previous Distribution Dates.
Amounts payable as Uncertificated Accrued Interest in respect of REMIC
1 Regular Interest LT1ZZ shall be reduced and deferred when the REMIC
1 Overcollateralized Amount is less than the REMIC 1
Overcollateralization Target Amount, by the lesser of (x) the amount
of such difference and (y) the Maximum LT1ZZ Uncertificated Accrued
Interest Deferral Amount and such amount will be payable to the
Holders of REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest
LT1AV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular Interest
LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1 Regular Interest
LT1AF2, REMIC 1 Regular Interest LT1AF3, REMIC 1 Regular Interest
LT1AF4, REMIC 1 Regular Interest LT1AF5, REMIC 1 Regular Interest
LT1M1, REMIC 1 Regular Interest LT1M2, REMIC 1 Regular Interest LT1M3,
REMIC 1 Regular Interest LT1B1, REMIC 1 Regular Interest LT1B2, REMIC
1 Regular Interest LT1B3 and REMIC 1 Regular Interest LT1B4 in the
same proportion as the Overcollateralization Deficiency is allocated
to the Corresponding Certificates and the Uncertificated Principal
Balance of REMIC 1 Regular Interest LT1ZZ shall be increased by such
amount;
(ii) to Holders of REMIC 1 Regular Interest LT1SUB, REMIC 1
Regular Interest LT1GRP, REMIC 1 Regular Interest LT2SUB, REMIC 1
Regular Interest LT2GRP and REMIC 1 Regular Interest LT1XX, PRO RATA,
in an amount equal to (A) the Uncertificated Accrued Interest for such
Distribution Date, plus (B) any amounts in respect thereof remaining
unpaid from previous Distribution Dates;
(iii) to the Holders of REMIC 1 Regular Interests, in an amount
equal to the remainder of the REMIC 1 Marker Allocation Percentage of
Available Funds for such Distribution Date after the distributions
made pursuant to clause (i) above, allocated as follows:
(a) 98.00% of such remainder to the Holders of REMIC
1 Regular Interest LT1AA until the Uncertificated Principal
Balance of such Uncertificated REMIC 1 Regular Interest is
reduced to zero;
(b) 2.00% of such remainder, first, to the Holders of
REMIC 1 Regular Interest LT1AV1, REMIC 1 Regular Interest
LT1AV2A, REMIC 1 Regular Interest LT1AV2B, REMIC 1 Regular
Interest LT1AV2C, REMIC 1 Regular Interest LT1AF1, REMIC 1
Regular Interest LT1AF2, REMIC 1 Regular Interest LT1AF3,
REMIC 1 Regular Interest LT1AF4, REMIC 1 Regular Interest
LT1AF5, REMIC 1 Regular Interest LT1M1, REMIC 1 Regular
Interest LT1M2,
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REMIC 1 Regular Interest LT1M3, REMIC 1 Regular Interest
LT1B1, REMIC 1 Regular Interest LT1B2, REMIC 1 Regular
Interest LT1B3 and REMIC 1 Regular Interest LT1B4, in the
same proportion as principal payments are allocated to the
Corresponding Certificates, until the Uncertificated
Principal Balances of such REMIC 1 Regular Interests are
reduced to zero; and second, to the Holders of REMIC 1
Regular Interest LT1ZZ until the Uncertificated Principal
Balance of such REMIC 1 Regular Interest is reduced to zero;
provided, however, that (i) 98.00% and (ii) 2.00% of any principal payments that
are attributable to an Overcollateralization Release Amount shall be allocated
to Holders of (i) REMIC 1 Regular Interest LT1AA and (ii) REMIC 1 Regular
Interest LT1ZZ, respectively; and
(iv) to the Holders of REMIC 1 Regular Interests, in an amount
equal to the remainder of the REMIC 1 Sub WAC Allocation Percentage of
Available Funds for such Distribution Date after the distributions
made pursuant to clause (i) above, such that distributions of
principal shall be deemed to be made to the REMIC 1 Regular Interests
first, so as to keep the Uncertificated Principal Balance of each
REMIC 1 Regular Interest ending with the designation "GRP" equal to
0.01% of the aggregate Principal Balance of the Mortgage Loans in the
related Loan Group; second, to each REMIC 1 Regular Interest ending
with the designation "SUB," so that the Uncertificated Principal
Balance of each such REMIC 1 Regular Interest is equal to 0.01% of the
excess of (x) the aggregate Principal Balance of the Mortgage Loans in
the related Loan Group over (y) the current Certificate Principal
Balance of the Class A Certificate in the related Loan Group (except
that if any such excess is a larger number than in the preceding
distribution period, the least amount of principal shall be
distributed to such REMIC 1 Regular Interests such that the REMIC 1
Subordinated Balance Ratio is maintained); and third, any remaining
principal to REMIC 1 Regular Interest LT1XX.
Notwithstanding the distributions pursuant to this Section
4.08, distribution of funds shall be made only in accordance with Section 4.01
and Section 4.02.
(b) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 3 on account of the Class B-2 Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-3 Interest), as the case may be:
(i) to the Holders of the Class B-2 Interest, in an amount equal
to (A) the Accrued Certificate Interest for such Distribution Date,
plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates; and
(ii) to the Holders of the Class B-2 Interest, until the
Certificate Principal Balance of the Class B-2 Interest is reduced to
zero.
(c) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 4 on account of the Class B-3 Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-4 Interest), as the case may be:
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(i) to the Holders of the Class B-3 Interest, in an amount equal
to (A) the Accrued Certificate Interest for such Distribution Date,
plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates; and
(ii) to the Holders of the Class B-3 Interest, until the
Certificate Principal Balance of the Class B-3 Interest is reduced to
zero.
(d) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 5 on account of the Class B-4 Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-5 Interest), as the case may be:
(i) to the Holders of the Class B-4 Interest, in an amount equal
to (A) the Accrued Certificate Interest for such Distribution Date,
plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates; and
(ii) to the Holders of the Class B-4 Interest, until the
Certificate Principal Balance of the Class B-4 Interest is reduced to
zero.
(e) On each Distribution Date, the Trustee shall cause in the
following order of priority, the following amounts to be distributed by REMIC 2
to REMIC 6 on account of the Class X/N Interest or withdrawn from the
Distribution Account and distributed to the Holders of the Class R-X
Certificates (in respect of the Class R-6 Interest), as the case may be:
(i) to the Holders of the Class X/N Interest, in an amount equal
to (A) the Accrued Certificate Interest for such Distribution Date,
plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates; and
(ii) to the Holders of the Class X/N Interest, until the
Certificate Principal Balance of the Class X/N Interest is reduced to
zero.
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ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
Each of the Class A Certificates, the Mezzanine Certificates,
the Class N Certificates, the Class X Certificates and the Residual Certificates
shall be substantially in the forms annexed hereto as exhibits, and shall, on
original issue, be executed by the Trustee and authenticated and delivered by
the Certificate Registrar to or upon the receipt of a Written Order to
Authenticate from the Depositor concurrently with the sale and assignment to the
Trustee of the Trust Fund. Each Class of the Class A Certificates and the
Mezzanine Certificates shall be initially evidenced by one or more Certificates
representing a Percentage Interest with a minimum dollar (or notional amount)
denomination of $25,000 and integral multiples of $1 in excess thereof. The
Class N, Class X and Residual Certificates are issuable only in minimum
Percentage Interests of 10%.
The Certificates shall be executed on behalf of the Trust by
manual or facsimile signature on behalf of the Trustee by a Responsible Officer.
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
the Trustee shall bind the Trust, 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
Certificate. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless such Certificate shall have been
manually authenticated by the Certificate Registrar substantially in the form
provided for herein, and such authentication 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. Subject to Section 5.02(c), the Class A Certificates
and the Mezzanine Certificates shall be Book-Entry Certificates. The Class N,
Class X and Residual Certificates shall not be Book-Entry Certificates but shall
be issued in fully registered certificate form.
Section 5.02 Registration of Transfer and Exchange of
Certificates.
(a) The Certificate Registrar shall cause to be kept at the
Corporate Trust Office of the Trustee a Certificate Register in which, subject
to such reasonable regulations as it may prescribe, the Certificate Registrar
shall provide for the registration of Certificates and of transfers and
exchanges of Certificates as herein provided. The Trustee shall initially serve
as Certificate Registrar for the purpose of registering Certificates and
transfers and exchanges of Certificates as herein provided. The Trustee as
Certificate Registrar shall be subject to the same standards of care,
limitations on liability and rights to indemnity as the Trustee, and the
provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05, 8.14, 8.15 and 8.16 shall
apply to the Certificate Registrar to the same extent as they apply to the
Trustee. Any Certificate Registrar appointed in accordance with this Section
5.02(a) may at any time resign by giving at least 30 days' advance written
notice of resignation to the Trustee, the Servicer and the Depositor, such
resignation to become effective upon appointment of a successor Certificate
Registrar.
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Upon surrender for registration of transfer of any Certificate
at any office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of a Residual Certificate,
upon satisfaction of the conditions set forth below, the Trustee on behalf of
the Trust shall execute and the Certificate Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of the same aggregate Percentage Interest.
At the option of the Certificateholders, Certificates may be
exchanged for other Certificates in authorized denominations and the same
aggregate Percentage Interests, upon surrender of the Certificates to be
exchanged at any such office or agency. Whenever any Certificates are so
surrendered for exchange, the Trustee shall execute on behalf of the Trust and
the Certificate Registrar 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 (if so required by the Trustee or the Certificate Registrar) be duly
endorsed by, or be accompanied by a written instrument of transfer satisfactory
to the Trustee and the Certificate Registrar duly executed by, the Holder
thereof or his attorney duly authorized in writing.
(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 Depository, the initial Depository, by, or on behalf of, the Depositor;
or to, and deposited with the Certificate Custodian, on behalf of the
Depository, if directed to do so pursuant to instructions from the Depository.
Except as provided in paragraph (c) below, the Book-Entry Certificates shall at
all times remain registered in the name of the Depository or its nominee and at
all times: (i) registration of such Certificates may not be transferred by the
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Certificates; (iii) ownership and transfers of
registration of such Certificates on the books of the Depository shall be
governed by applicable rules established by the Depository; (iv) the Depository
may collect its usual and customary fees, charges and expenses from its
Depository Participants; (v) the Trustee shall for all purposes deal with the
Depository as representative of the Certificate Owners of the Certificates for
purposes of exercising the rights of Holders under this Agreement, and requests
and directions for and votes of such representative shall not be deemed to be
inconsistent if they are made with respect to different Certificate Owners; (vi)
the Trustee may rely and shall be fully protected in relying upon information
furnished by the Depository with respect to its Depository Participants and
furnished by the Depository Participants with respect to indirect participating
firms and Persons shown on the books of such indirect participating firms as
direct or indirect Certificate Owners; and (vii) the direct participants of the
Depository shall have no rights under this Agreement under or with respect to
any of the Certificates held on their behalf by the Depository, and the
Depository may be treated by the Trustee and its agents, employees, officers and
directors as the absolute owner of the Certificates for all purposes whatsoever.
All transfers by Certificate Owners of Book-Entry Certificates
shall be made in accordance with the procedures established by the Depository
Participant or brokerage firm representing such Certificate Owners. Each
Depository Participant shall only transfer Book Entry Certificates of
Certificate Owners that it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures. The parties hereto
are hereby
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authorized to execute a Letter of Representations with the Depository or take
such other action as may be necessary or desirable to register a Book-Entry
Certificate to the Depository.
(c) If (i)(x) the Depository or the Depositor advises the
Trustee in writing that the Depository is no longer willing or able to discharge
properly its responsibilities as Depository and (y) the Trustee or the Depositor
is unable to locate a qualified successor or (ii) after the occurrence of a
Servicer Event of Termination, the Certificate Owners of each Class of
Book-Entry Certificates representing Percentage Interests of such Classes
aggregating not less than 51% advises the Trustee and Depository through the
Financial Intermediaries and the Depository Participants in writing that the
continuation of a book-entry system through the Depository to the exclusion of
definitive, fully registered certificates (the "Definitive Certificates") to
Certificate Owners is no longer in the best interests of the Certificate Owners.
Upon surrender to the Certificate Registrar of the Book-Entry Certificates by
the Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall, at the Depositor's expense, in the case of (ii)
above, or the Seller's expense, in the case of (i) and (iii) above, execute on
behalf of the Trust and the Certificate Registrar shall authenticate the
Definitive Certificates. Neither the Depositor nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates, the Trustee, the Certificate Registrar, the Servicer,
any Paying Agent and the Depositor shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.
(d) Except with respect to the initial transfer of the Private
Certificates by the Depositor, no transfer, sale, pledge or other disposition of
any Private Certificate shall be made unless such disposition is exempt from the
registration requirements of the Securities Act of 1933, as amended (the "1933
Act"), and any applicable state securities laws or is made in accordance with
the 1933 Act and laws. In the event of any such transfer, (i) unless such
transfer is made in reliance upon Rule 144A (as evidenced by the investment
letter delivered to the Certificate Registrar, in substantially the form
attached hereto as Exhibit J-2) under the 1933 Act, the Certificate Registrar
and the Depositor shall require a written Opinion of Counsel (which may be
in-house counsel) acceptable to and in form and substance reasonably
satisfactory to the Certificate Registrar and the Depositor that such transfer
may be made pursuant to an exemption, describing the applicable exemption and
the basis therefor, from the 1933 Act or is being made pursuant to the 1933 Act,
which Opinion of Counsel shall not be an expense of the Certificate Registrar or
the Depositor or (ii) the Certificate Registrar shall require the transferor to
execute a transferor certificate (in substantially the form attached hereto as
Exhibit L) and the transferee to execute an investment letter (in substantially
the form attached hereto as Exhibit J-1) acceptable to and in form and substance
reasonably satisfactory to the Depositor and the Certificate Registrar
certifying to the Depositor and the Certificate Registrar the facts surrounding
such transfer, which investment letter shall not be an expense of the
Certificate Registrar or the Depositor. The Holder of a Private Certificate
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Certificate Registrar and the Depositor against any liability that may result if
the transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of an ERISA Restricted Certificate shall be made
unless the Certificate Registrar shall have received either (i) a representation
from the transferee of such
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Certificate, acceptable to and in form and substance satisfactory to the
Certificate Registrar and the Depositor, (such requirement is satisfied only by
the Certificate Registrar's receipt of a representation letter from the
transferee substantially in the form of Exhibit I hereto, as appropriate), to
the effect that such transferee is not an employee benefit plan or arrangement
subject to Section 406 of ERISA or a plan subject to Section 4975 of the Code,
nor a person acting on behalf of any such plan or arrangement nor using the
assets of any such plan or arrangement to effect such transfer or (ii) (except
in the case of a Residual, Class X or Class N Certificate) if the purchaser is
an insurance company, a representation that the purchaser is an insurance
company which is purchasing such Certificates with funds contained in an
"insurance company general account" (as such term is defined in Section V(e) of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60") and that the
purchase and holding of such Certificates are covered under Sections I and III
of PTCE 95-60 or (iii) (except in the case of a Residual Certificate) in the
case of any such ERISA Restricted Certificate presented for registration in the
name of an employee benefit plan subject to ERISA or a plan or arrangement
subject to Section 4975 of the Code (or comparable provisions of any subsequent
enactments), or a trustee of any such plan or any other person acting on behalf
of any such plan or arrangement or using such plan's or arrangement's assets, an
Opinion of Counsel satisfactory to the Certificate Registrar, to the effect that
the purchase and holding of such ERISA Restricted Certificate will not result in
a non-exempt prohibited transaction under ERISA and the Code and will not
subject the Servicer, the Trustee or the Certificate Registrar to any obligation
in addition to those expressly undertaken in this Agreement or to any liability.
For purposes of the preceding sentence, the representation in (i) or (ii) shall
be deemed to have been made to the Certificate Registrar by the acceptance by a
Certificate Owner of the beneficial interest in any such Class of ERISA
Restricted Certificates, unless the Certificate Registrar shall have received
from the transferee an alternative representation acceptable in form and
substance to the Depositor. Notwithstanding anything else to the contrary
herein, any purported transfer of an ERISA Restricted Certificate to or on
behalf of an employee benefit plan subject to ERISA in violation of this
paragraph as described above shall be void and of no effect.
Each Person who has or who acquires any Ownership Interest in
a Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably appointed the Depositor or its designee as its attorney-in-fact
to negotiate the terms of any mandatory sale under clause (v) below and to
execute all instruments of transfer and to do all other things necessary in
connection with any such sale, and the rights of each Person acquiring any
Ownership Interest in a Residual Certificate are expressly subject to the
following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall
promptly notify the Certificate Registrar of any change or impending
change in its status as a Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in a Residual
Certificate unless such Ownership Interest is a PRO RATA undivided
interest.
(iii) In connection with any proposed transfer of any Ownership
Interest in a Residual Certificate, the Certificate Registrar shall as
a condition to registration of the
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transfer, require delivery to it, in form and substance satisfactory
to it, of each of the following:
A. an affidavit in the form of Exhibit K hereto from the
proposed transferee to the effect that, among other things, such transferee is a
Permitted Transferee and that it is not acquiring its Ownership Interest in the
Residual Certificate that is the subject of the proposed transfer as a nominee,
trustee or agent for any Person who is not a Permitted Transferee; and
B. a covenant of the proposed transferee to the effect that
the proposed transferee agrees to be bound by and to abide by the transfer
restrictions applicable to the Residual Certificates.
(iv) Any attempted or purported transfer of any Ownership
Interest in a Residual Certificate in violation of the provisions of
this Section shall be absolutely null and void and shall vest no
rights in the purported transferee. If any purported transferee shall,
in violation of the provisions of this Section, become a Holder of a
Residual Certificate, then the prior Holder of such Residual
Certificate that is a Permitted Transferee shall, upon discovery that
the registration of transfer of such Residual Certificate was not in
fact permitted by this Section, be restored to all rights as Holder
thereof retroactive to the date of registration of transfer of such
Residual Certificate. The Certificate Registrar shall be under no
liability to any Person for any registration of transfer of a Residual
Certificate that is in fact not permitted by this Section or for
making any distributions due on such Residual 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 Certificate
Registrar received the documents specified in clause (iii). The
Trustee shall be entitled to recover from any Holder of a Residual
Certificate that was in fact not a Permitted Transferee at the time
such distributions were made all distributions made on such Residual
Certificate. Any such distributions so recovered by the Trustee shall
be distributed and delivered by the Trustee to the prior Holder of
such Residual Certificate that is a Permitted Transferee.
(v) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section, then the Certificate Registrar shall
have the right but not the obligation, without notice to the Holder of
such Residual Certificate or any other Person having an Ownership
Interest therein, to notify the Depositor to arrange for the sale of
such Residual Certificate. The proceeds of such sale, net of
commissions (which may include commissions payable to the Depositor or
its affiliates in connection with such sale), expenses and taxes due,
if any, will be remitted by the Trustee to the previous Holder of such
Residual Certificate that is a Permitted Transferee, except that in
the event that the Trustee determines that the Holder of such Residual
Certificate may be liable for any amount due under this Section or any
other provisions of this Agreement, the Trustee may withhold a
corresponding amount from such remittance as security for such claim.
The terms and conditions of any sale under this clause (v) shall be
determined in the sole discretion of the Trustee and it shall not be
liable to any Person having an Ownership Interest in a Residual
Certificate as a result of its exercise of such discretion.
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(vi) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the
restrictions in this Section, then the Trustee will provide to the
Internal Revenue Service, and to the persons specified in Sections
860E(e)(3) and (6) of the Code, information needed to compute the tax
imposed under Section 860E(e)(5) of the Code on transfers of residual
interests to disqualified organizations. The Trustee shall be entitled
to reasonable compensation for providing such information from the
person to whom it is provided.
The foregoing provisions of this Section shall cease to apply
to transfers occurring on or after the date on which there shall have been
delivered to the Certificate Registrar, in form and substance satisfactory to
the Certificate Registrar, (i) written notification from each Rating Agency that
the removal of the restrictions on Transfer set forth in this Section will not
cause such Rating Agency to downgrade its rating of the Certificates and (ii) an
Opinion of Counsel to the effect that such removal will not cause any REMIC
hereunder to fail to qualify as a REMIC.
(e) No service charge shall be made for any registration of
transfer or exchange of Certificates of any Class, 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 or
exchange shall be cancelled by the Certificate Registrar and disposed of
pursuant to its standard procedures.
Section 5.03 Mutilated, Destroyed, Lost or Stolen
Certificates.
If (i) 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 (ii) there
is delivered to the Trustee, the Depositor and the Certificate Registrar such
security or indemnity as may be required by them to save each of them harmless,
then, in the absence of notice to the Trustee or the Certificate Registrar that
such Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute on behalf of the Trust, and the Certificate Registrar shall authenticate
and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost
or stolen Certificate, a new Certificate of like tenor and Percentage Interest.
Upon the issuance of any new Certificate under this Section, the Trustee or 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) in connection therewith. Any duplicate Certificate issued
pursuant to this Section, shall constitute complete and indefeasible evidence of
ownership in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners.
The Servicer, the Depositor, the Trustee, the Certificate
Registrar, any Paying Agent and any agent of the Servicer, the Depositor, the
Certificate Registrar, any Paying Agent or the Trustee may treat the Person,
including a Depository, in whose name any Certificate is registered as the owner
of such Certificate for the purpose of receiving distributions pursuant to
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Section 4.01 and Section 4.02 and for all other purposes whatsoever, and none of
the Servicer, the Trust, the Trustee nor any agent of any of them shall be
affected by notice to the contrary.
Section 5.05 Appointment of Paying Agent.
The Paying Agent shall make distributions to
Certificateholders from the Distribution Account pursuant to Section 4.01 and
Section 4.02 and shall report the amounts of such distributions to the Trustee.
The duties of the Paying Agent may include the obligation (i) to withdraw funds
from the Collection Account pursuant to Section 3.05 and for the purpose of
making the distributions referred to above and (ii) to distribute statements and
provide information to Certificateholders as required hereunder. The Paying
Agent hereunder shall at all times be an entity duly incorporated and validly
existing under the laws of the United States of America or any state thereof,
authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by federal or state authorities. The Paying Agent
shall initially be the Trustee. The Trustee may appoint a successor to act as
Paying Agent, which appointment shall be reasonably satisfactory to the
Depositor and the Rating Agencies. The Trustee as Paying Agent shall be subject
to the same standards of care, limitations on liability and rights to indemnity
as the Trustee, and the provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05,
8.14, 8.15 and 8.16 shall apply to the Paying Agent to the same extent as they
apply to the Trustee. Any Paying Agent appointed in accordance with this Section
5.02(a) may at any time resign by giving at least 30 days' advance written
notice of resignation to the Trustee, the Servicer and the Depositor, such
resignation to become effective upon appointment of a successor Paying Agent.
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ARTICLE VI
THE SELLER, THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Seller, the Servicer and the
Depositor.
The Seller and the Servicer shall be liable in accordance
herewith only to the extent of the obligations specifically imposed upon and
undertaken by the Seller or Servicer, as the case may be, herein. The Depositor
shall be liable in accordance herewith only to the extent of the obligations
specifically imposed upon and undertaken by the Depositor.
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Seller, the Servicer or the Depositor.
Any entity into which the Seller, the Servicer or the
Depositor may be merged or consolidated, or any entity resulting from any
merger, conversion or consolidation to which the Seller, the Servicer or the
Depositor shall be a party, or any corporation succeeding to the business of the
Seller, the Servicer or the Depositor, shall be the successor of the Seller, the
Servicer or the Depositor, as the case may be, 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, however, that
the successor Servicer shall satisfy all the requirements of Section 7.02 with
respect to the qualifications of a successor Servicer.
Section 6.03 Limitation on Liability of the Servicer and
Others.
Neither the Servicer, the Depositor nor any of the directors
or officers or employees or agents of the Servicer or the Depositor shall be
under any liability to the Trust or the Certificateholders for any action taken
or for refraining from the taking of any action by the Servicer in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Servicer, the Depositor or any such Person
against any liability which would otherwise be imposed by reason of its willful
misfeasance, bad faith or gross negligence in the performance of duties of the
Servicer or the Depositor or by reason of its reckless disregard of its
obligations and duties of the Servicer or the Depositor hereunder; provided,
further, that this provision shall not be construed to entitle the Servicer to
indemnity in the event that amounts advanced by the Servicer to retire any
senior lien exceed Liquidation Proceeds (in excess of related liquidation
expenses) realized with respect to the related Mortgage Loan. The Servicer, the
Depositor and any director or officer or employee or agent of the Servicer or
the Depositor 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. The Servicer, the Depositor and any director or officer or employee
or agent of the Servicer or the Depositor shall be indemnified by the Trust and
held harmless against any loss, liability or expense incurred in connection with
any legal action relating to this Agreement or the Certificates, other than any
loss, liability or expense incurred by reason of its willful misfeasance, bad
faith or negligence in the performance of duties hereunder or by reason of its
reckless disregard of obligations and duties hereunder. The Servicer or the
Depositor may 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
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Certificateholders hereunder. In such event, the reasonable legal expenses and
costs of such action and any liability resulting therefrom shall be expenses,
costs and liabilities of the Trust and the Servicer or the Depositor shall be
entitled to pay such expenses from the proceeds of the Trust or to be reimbursed
therefor pursuant to Section 3.05 upon presentation to the Trustee of
documentation of such expenses, costs and liabilities. The Servicer's right to
indemnity or reimbursement pursuant to this Section shall survive any
resignation or termination of the Servicer pursuant to Section 6.04 or 7.01 with
respect to any losses, expenses, costs or liabilities arising prior to such
resignation or termination (or arising from events that occurred prior to such
resignation or termination). This paragraph shall apply to the Servicer and the
Depositor solely in their capacities as Servicer and Depositor hereunder and in
no other capacities.
Section 6.04 Servicer Not to Resign.
Subject to the provisions of Section 7.01 and Section 6.02,
the Servicer shall not resign from the obligations and duties hereby imposed on
it except (i) upon determination that the performance of its obligations or
duties hereunder are no longer permissible under applicable law or are in
material conflict by reason of applicable law with any other activities carried
on by it or its subsidiaries or Affiliates, the other activities of the Servicer
so causing such a conflict being of a type and nature carried on by the Servicer
or its subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of the following conditions: (a) the Servicer has proposed a
successor servicer to the Trustee in writing and such proposed successor
servicer is reasonably acceptable to the Trustee; and (b) each Rating Agency
shall have delivered a letter to the Trustee prior to the appointment of the
successor servicer stating that the proposed appointment of such successor
servicer as Servicer hereunder will not result in the reduction or withdrawal of
the then current rating of the Regular Certificates or the ratings that are in
effect; provided, however, that no such resignation by the Servicer shall become
effective until such successor servicer or, in the case of (i) above, the
Trustee shall have assumed the Servicer's responsibilities and obligations
hereunder or the Trustee shall have designated a successor servicer in
accordance with Section 7.02. Any such resignation shall not relieve the
Servicer of responsibility for any of the obligations specified in Sections 7.01
and 7.02 as obligations that survive the resignation or termination of the
Servicer. Any such determination permitting the resignation of the Servicer
pursuant to clause (i) above shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. Any such determination permitting the
resignation of the Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee.
The Trustee and the Depositor hereby specifically (i) consent
to the pledge and assignment by the Servicer of all the Servicer's right, title
and interest in, to and under this Agreement to the Servicing Rights Pledgee,
for the benefit of certain lenders, and (ii) provided that no Servicer Event of
Termination exists, agree that upon delivery to the Trustee by the Servicing
Rights Pledgee of a letter signed by the Servicer whereunder the Servicer shall
resign as Servicer under this Agreement, the Trustee shall appoint the Servicing
Rights Pledgee or its designee as successor Servicer, provided that at the time
of such appointment, the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer pursuant to Section 7.02(a) and agrees to
be subject to the terms of this Agreement. If, pursuant to any provision hereof,
the duties of the Servicer are transferred to a successor, the entire amount of
the
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Servicing Fee and other compensation payable to the Servicer pursuant hereto
shall thereafter be payable to such successor.
Section 6.05 Delegation of Duties.
In the ordinary course of business, the Servicer at any time
may delegate any of its duties hereunder to any Person, including any of its
Affiliates, who agrees to conduct such duties in accordance with standards
comparable to those set forth in Section 3.01. Such delegation shall not relieve
the Servicer of its liabilities and responsibilities with respect to such duties
and shall not constitute a resignation within the meaning of Section 6.04. The
Servicer shall provide the Trustee and the Rating Agencies with 60 days prior
written notice prior to the delegation of any of its duties to any Person other
than any of the Servicer's Affiliates or their respective successors and
assigns.
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ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination.
(a) If any one of the following events ("Servicer Events of
Termination") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any Advance; or (B)
any other failure by the Servicer to deposit in the Collection Account
or Distribution Account any deposit required to be made under the
terms of this Agreement which continues unremedied for a period of one
Business Day after the date upon which written notice of such failure
shall have been given to the Servicer by the Trustee or by any Holder
of a Regular Certificate evidencing at least 25% of the Voting Rights;
or
(ii) The failure by the Servicer to make any required Servicing
Advance which failure continues unremedied for a period of 30 days, or
the failure by the Servicer duly to observe or perform, in any
material respect, any other covenants, obligations or agreements of
the Servicer as set forth in this Agreement, which failure continues
unremedied for a period of 30 days, after the date (A) on which
written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Trustee or by any Holder
of a Regular Certificate evidencing at least 25% of the Voting Rights
or (B) actual knowledge of such failure by a Servicing Officer of the
Servicer; or
(iii) The entry against the Servicer of a decree or order by a
court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a trustee, conservator, receiver or
liquidator in any insolvency, conservatorship, receivership,
readjustment of debt, marshalling 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 days; or
(iv) The Servicer shall voluntarily go into liquidation, consent
to the appointment of a conservator or receiver or liquidator or
similar person in any insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings of or relating to the
Servicer or of or relating to all or substantially all of its
property; or a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
conservator, receiver, liquidator or similar person in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Servicer and such decree or order
shall have remained in force undischarged, unbonded or unstayed for a
period of 60 days; 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
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(v) The aggregate amount of cumulative Realized Losses incurred
since the Cut-off Date through the last day of the related Collection
Period divided by the initial Pool Balance exceeds the applicable
percentages set forth below with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
------------------------------ ----------
November 2006 through October 2007 3.75%
November 2007 through October 2008 4.20%
November 2008 through October 2009 6.00%
November 2009 through October 2010 7.50%
November 2010 and thereafter 9.00%
(b) Then, and in each and every such case, so long as a
Servicer Event of Termination shall not have been remedied within the applicable
grace period, (x) with respect solely to clause (i)(A) above, if such Advance is
not made by 2:00 P.M., New York time, on the Business Day immediately following
the Servicer Remittance Date, the Trustee may terminate all of the rights and
obligations of the Servicer under this Agreement and the Trustee, or a successor
servicer appointed in accordance with Section 7.02, shall immediately make such
Advance and assume, pursuant to Section 7.02, the duties of a successor Servicer
and (y) in the case of (i)(B), (ii), (iii), (iv) and (v) above, the Trustee
shall, at the direction of the Holders of each Class of Regular Certificates
evidencing Percentage Interests aggregating not less than 51%, by notice then
given in writing to the Servicer and the Trustee, terminate all of the rights
and obligations of the Servicer as servicer under this Agreement. Any such
notice to the Servicer shall also be given to each Rating Agency, the Depositor
and the Seller. On or after the receipt by the Servicer and the Trustee of such
written notice, all authority and power of the Servicer under this Agreement,
whether with respect to the Certificates or the Mortgage Loans or otherwise,
shall pass to and be vested in the Trustee pursuant to and under this Section;
and, without limitation, the Trustee is hereby authorized and empowered to
execute and deliver, on behalf of the Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and endorsement of each
Mortgage Loan and Related Documents or otherwise. The Servicer agrees to
cooperate with the Trustee (or the applicable successor Servicer) in effecting
the termination of the responsibilities and rights of the Servicer hereunder,
including, without limitation, the delivery to the successor Servicer of all
documents and records requested by it to enable it to assume the Servicer's
functions under this Agreement within ten Business Days subsequent to such
notice, the transfer within one Business Day subsequent to such notice to the
Trustee (or the applicable successor Servicer) for the administration by it of
all cash amounts that shall at the time be held by the Servicer and to be
deposited by it in the Collection Account, the Distribution Account, any REO
Account or any Escrow Account or that have been deposited by the Servicer in
such accounts or thereafter received by the Servicer with respect to the
Mortgage Loans or any REO Property received by the Servicer. All reasonable
costs and expenses (including attorneys' fees) incurred in connection with
transferring the servicing to the successor Servicer and amending this Agreement
to reflect such succession as Servicer pursuant to this Section shall be paid by
the predecessor Servicer (or if the predecessor Servicer is the Trustee, the
initial Servicer) upon presentation of reasonable documentation of such costs
and expenses.
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Section 7.02 Trustee to Act; Appointment of Successor.
(a) Within 90 days of the time the Servicer and the Trustee
receives a notice of termination or resignation pursuant to Section 7.01 or
6.04, the Trustee (or such other successor Servicer as is approved in accordance
with this Agreement) shall be the successor in all respects to the Servicer in
its capacity as servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof arising on and after its succession. As compensation therefor, the
Trustee (or such other successor Servicer) shall be entitled to such
compensation as the Servicer would have been entitled to hereunder if no such
notice of termination had been given. Notwithstanding the above, (i) if the
Trustee is unwilling to act as successor Servicer or (ii) if the Trustee is
legally unable so to act, the Trustee shall appoint or petition a court of
competent jurisdiction to appoint, any established housing and home finance
institution, bank or other mortgage loan or home equity loan servicer having a
net worth of not less than $50,000,000 as the successor to the Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder; provided, that the appointment of any
such successor Servicer will not result in the qualification, reduction or
withdrawal of the ratings assigned to the Certificates or the ratings that are
in effect by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The successor servicer shall be
entitled to withdraw from the Collection Account all costs and expenses
associated with the transfer of the servicing to the successor servicer. The
appointment of a successor servicer shall not affect any liability of the
predecessor Servicer which may have arisen under this Agreement prior to its
termination as Servicer to pay any deductible under an insurance policy pursuant
to Section 3.12 or to indemnify the parties indicated in Section 3.26 pursuant
to the terms thereof, nor shall any successor Servicer be liable for any acts or
omissions of the predecessor Servicer or for any breach by such Servicer of any
of its representations or warranties contained herein or in any related document
or agreement. The Trustee and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.
In the event of a Servicer Event of Termination,
notwithstanding anything to the contrary above, the Trustee and the Depositor
hereby agree that upon delivery to the Trustee by the Servicing Rights Pledgee
of a letter signed by the Servicer within ten Business Days of when notification
of such event shall have been provided to the Trustee, whereunder the Servicer
shall resign as Servicer under this Agreement, the Servicing Rights Pledgee or
its designee shall be appointed as successor Servicer (provided that at the time
of such appointment the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer set forth above) and the Servicing Rights
Pledgee agrees to be subject to the terms of this Agreement.
(b) Any successor, including the Trustee, to the Servicer as
servicer shall during the term of its service as servicer continue to service
and administer the Mortgage Loans
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for the benefit of Certificateholders, and maintain in force a policy or
policies of insurance covering errors and omissions in the performance of its
obligations as Servicer hereunder and a Fidelity Bond in respect of its
officers, employees and agents to the same extent as the Servicer is so required
pursuant to Section 3.12.
Section 7.03 Waiver of Defaults.
The Majority Certificateholders may, on behalf of all
Certificateholders, waive any events permitting removal of the Servicer as
servicer pursuant to this Article VII, provided, however, that the Majority
Certificateholders may not waive a default in making a required distribution on
a Certificate without the consent of the Holder of such Certificate. Upon any
waiver of a past default, such default shall cease to exist and any Servicer
Event of Termination arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereto except to the extent
expressly so waived. Notice of any such waiver shall be given by the Trustee to
the Rating Agencies.
Section 7.04 Notification to Certificateholders.
(a) On any termination or appointment of a successor the
Servicer pursuant to this Article VII or Section 6.04, the Trustee shall give
prompt written notice thereof to the Certificateholders at their respective
addresses appearing in the Certificate Register and each Rating Agency.
(b) No later than 60 days after the occurrence of any event
which constitutes or which, with notice or a lapse of time or both, would
constitute a Servicer Event of Termination for five Business Days after a
Responsible Officer of the Trustee becomes aware of the occurrence of such an
event, the Trustee shall transmit by mail to all Certificateholders notice of
such occurrence unless such default or Servicer Event of Termination shall have
been waived or cured. Such notice shall be given to the Rating Agencies promptly
after any such occurrence.
Section 7.05 Survivability of Servicer Liabilities.
Notwithstanding anything herein to the contrary, upon
termination of the Servicer hereunder, any liabilities of the Servicer which
accrued prior to such termination shall survive such termination.
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ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of Trustee.
The Trustee, prior to the occurrence of a Servicer Event of
Termination of which a Responsible Officer of the Trustee shall have actual
knowledge and after the curing of all Servicer Events of Termination which may
have occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. If a Servicer Event of Termination has
occurred (which has not been cured) of which a Responsible Officer has actual
knowledge, 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 person would exercise or use under the circumstances in the conduct
of such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee 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; provided, however, that the
Trustee shall not be responsible for the accuracy or content of any resolution,
certificate, statement, opinion, report, document, order or other instrument
furnished by the Servicer, the Seller or the Depositor hereunder. If any such
instrument is found not to conform in any material respect to the requirements
of this Agreement, the Trustee shall notify the Certificateholders of such
instrument in the event that the Trustee, after so requesting, does not receive
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:
(i) prior to the occurrence of a Servicer Event of Termination,
and after the curing of all such Servicer Events of Termination 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 or opinions furnished to the Trustee and conforming
to the requirements of this Agreement;
(ii) the Trustee shall not be 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 or
investigating the facts related thereto;
(iii) the Trustee shall not be 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 Majority
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Certificateholders relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee or
exercising or omitting to exercise any trust or power conferred upon
the Trustee under this Agreement; and
(iv) the Trustee shall not be charged with knowledge of any
failure by the Servicer to comply with the obligations of the Servicer
referred to in clauses (i) and (ii) of Section 7.01(a) or any Servicer
Event of Termination unless a Responsible Officer of the Trustee at
the applicable Corporate Trust Office obtains actual knowledge of such
failure or the Trustee receives written notice of such failure from
the Servicer or the Majority Certificateholders. In the absence of
such receipt of such notice, the Trustee may conclusively assume that
there is no Servicer Event of Termination.
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
none of the provisions contained 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 with respect to
the Trustee 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.
The Trustee shall not have any duty (A) to see any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation statement evidencing a security
interest, or to see to the maintenance of any such recording or filing or
depositing or to any rerecording, refiling or redepositing of any thereof, (B)
to see to any insurance or (C) to see to the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of any kind
owing with respect to, assessed or levied against, any part of the Trust Fund
other than from funds available in the Distribution Account.
Section 8.02 Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) the Trustee may request and rely upon, and shall be protected
in acting or refraining from acting upon, any resolution, Officer's
Certificate, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond or other paper or document reasonably believed
by it to be genuine and to have been signed or presented by the proper
party or parties;
(ii) the Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(iii) the Trustee shall not be under any obligation to exercise
any of the rights or powers vested in it by this Agreement, or to
institute, conduct or defend any litigation
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hereunder or in relation hereto, at the request, order or direction 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; the right of the
Trustee to perform any discretionary act enumerated in this Agreement
shall not be construed as a duty, and the Trustee shall not be
answerable for other than its negligence or willful misconduct in the
performance of any such act;
(iv) the Trustee shall not be 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;
(v) prior to the occurrence of a Servicer Event of Termination
and after the curing of all Servicer Events of Termination 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 documents, unless
requested in writing to do so by the Majority Certificateholder;
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 indemnity against such cost, expense or liability as a
condition to such proceeding. The reasonable expense of every such
examination shall be paid by the Servicer or, if paid by the Trustee,
shall be reimbursed by the Servicer upon demand. Nothing in this
clause (v) shall derogate from the obligation of the Servicer to
observe any applicable law prohibiting disclosure of information
regarding the Mortgagors;
(vi) the Trustee shall not be accountable, shall have any
liability or make any representation as to any acts or omissions
hereunder of the Servicer until such time as the Trustee may be
required to act as Servicer pursuant to Section 7.02;
(vii) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian and the Trustee shall not
be responsible for any misconduct or negligence on the part of any
such agent, attorney or custodian appointed by it with due care; and
(viii) the right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of such act.
(b) The Depositor hereby directs the Trustee to execute,
deliver and perform its obligations under the Cap Contracts on the Closing Date
and thereafter on behalf of the Holders of the Group I Certificates, the Class
AF-1 Certificates and the Mezzanine Certificates. The Seller, the Depositor, the
Servicer and the Holders of the Group I Certificates, the Class AF-1
Certificates and the Mezzanine Certificates by their acceptance of such
Certificates, acknowledge and agree that the Trustee shall execute, deliver and
perform its obligations under
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the Cap Contracts and shall do so solely in its capacity as Trustee of the Trust
Fund and not in its individual capacity.
Section 8.03 Trustee Not Liable for Certificates or Mortgage
Loans.
The recitals contained herein and in the Certificates (other
than the authentication of the Trustee on the Certificates) shall be taken as
the statements of the Seller, 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 or of the Certificates (other than the
signature of the Trustee and authentication of the Trustee on the Certificates)
or of any Mortgage Loan or Related Document. The Trustee shall not be
accountable for the use or application by the Servicer, 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 by the Servicer. The
Trustee shall not at any time have any responsibility or liability for or with
respect to the legality, validity and enforceability of any Mortgage or any
Mortgage Loan, or the perfection and priority of any Mortgage or the maintenance
of any such perfection and priority, or for or with respect to the sufficiency
of the Trust or its ability to generate the payments to be distributed to
Certificateholders under this Agreement, including, without limitation: the
existence, condition and ownership of any Mortgaged Property; the existence and
enforceability of any hazard insurance thereon (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 7.02); the validity of the
assignment of any Mortgage Loan to the Trustee or of any intervening assignment;
the completeness of any Mortgage Loan; the performance or enforcement of any
Mortgage Loan (other than if the Trustee shall assume the duties of the Servicer
pursuant to Section 7.02); the compliance by the Depositor, the Seller or the
Servicer with any warranty or representation made under this Agreement or in any
related document or the accuracy of any such warranty or representation prior to
the Trustee's receipt of notice or other discovery of any non-compliance
therewith or any breach thereof; any investment of monies by or at the direction
of the Servicer or any loss resulting therefrom, it being understood that the
Trustee shall remain responsible for any Trust property that it may hold in its
individual capacity; the acts or omissions of any of the Servicer (other than if
the Trustee shall assume the duties of the Servicer pursuant to Section 7.02),
or any Mortgagor; any action of the Servicer (other than if the Trustee shall
assume the duties of the Servicer pursuant to Section 7.02), taken in the name
of the Trustee; the failure of the Servicer to act or perform any duties
required of it as agent of the Trustee hereunder; or any action by the Trustee
taken at the instruction of the Servicer (other than if the Trustee shall assume
the duties of the Servicer pursuant to Section 7.02); provided, however, that
the foregoing shall not relieve the Trustee of its obligation to perform its
duties under this Agreement. The Trustee shall not have any responsibility for
filing any financing or continuation statement in any public office at any time
or to otherwise perfect or maintain the perfection of any security interest or
lien granted to it hereunder.
Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Certificates with the same rights as it would have if it
were not Trustee and may transact any banking and trust business with the
Seller, the Servicer, the Depositor or their Affiliates.
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Section 8.05 Seller to Pay Trustee Fees and Expenses.
The Trustee shall withdraw from the Distribution Account on
each Distribution Date and pay to itself its fees in an aggregate amount equal
to the Trustee Fee pursuant to Section 4.01 and, to the extent the sum of the
Group I Interest Remittance Amount and the Group II Interest Remittance Amount
is at any time insufficient for such purpose, the Seller shall pay such fees as
reasonable compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trusts hereby created and in the exercise
and performance of any of the powers and duties hereunder of the Trustee, and
the Seller will pay or reimburse the Trustee upon their request for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from such party's negligence or bad faith or which is
the responsibility of Certificateholders or the Trustee hereunder.
Notwithstanding any other provision of this Agreement, including Section 2.03(a)
and Section 2.04, to the contrary, the Seller covenants and agrees to indemnify
the Trustee and its respective officers, directors, employees and agents from,
and hold each of them harmless against, any and all losses, liabilities,
damages, claims or expenses incurred in connection with any legal action
relating to this Agreement, the Certificates or incurred in connection with the
administration of the Trust, other than with respect to a party, any loss,
liability or expense incurred by reason of willful misfeasance, bad faith or
negligence of such party in the performance of their respective duties hereunder
or by reason of such party's reckless disregard of obligations and duties
hereunder. Anything in this Agreement to the contrary notwithstanding, in no
event shall the Trustee be liable for special, indirect or consequential loss or
damage of any kind whatsoever (including but not limited to lost profits), even
if the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action. The Trustee and any director, officer,
employee or agent of the Trustee shall be indemnified, to the extent not paid by
the Seller pursuant to this Section, by the Trust Fund and held harmless against
any loss, liability or expense (not including expenses, disbursements and
advances incurred or made by the Trustee, in the ordinary course of the
Trustee's performance in accordance with the provisions of this Agreement)
incurred by the Trustee or such party arising out of or in connection with the
acceptance or administration of its duties under this Agreement, other than any
loss, liability or expense incurred by reason of willful misfeasance, bad faith
or negligence in the performance by the Trustee of its duties under this
Agreement or by reason of the reckless disregard of the Trustee's obligations
and duties under this Agreement. This section shall survive termination of this
Agreement or the resignation or removal of any Trustee hereunder.
Section 8.06 Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a Department of
Housing and Urban Development and Federal Housing Administration approved
mortgagee, an entity duly organized and validly existing under the laws of the
United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 and a minimum long-term debt rating of BBB by Fitch and S&P
and a long term debt rating of at least A1 or better by ▇▇▇▇▇'▇, and subject to
supervision or
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examination by federal or state authority. If such entity 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 entity shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. The principal office of the Trustee (other than the
initial Trustee) shall be in a state with respect to which an Opinion of Counsel
has been delivered to such Trustee at the time such Trustee is appointed Trustee
to the effect that the Trust will not be a taxable entity under the laws of such
state. 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, the
Servicer and each Rating Agency. 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 the provisions of 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 their property shall be appointed, or any public
officer shall take charge or control of the Trustee or of their property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor may remove the Trustee. If the Depositor or the Servicer removes the
Trustee under the authority of the immediately 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 Majority Certificateholders may at any time remove the
Trustee by written instrument or instruments delivered to the Servicer, the
Depositor and the Trustee and any expenses incurred by the Trustee in connection
with such removal shall be reimbursed to it by the Majority Certificateholders
promptly upon demand therefor; the Depositor shall thereupon use its best
efforts to appoint a successor Trustee in accordance with this Section.
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, the Rating Agencies,
the Servicer and to its
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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 Depositor, the Servicer and the predecessor Trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for fully and certainly vesting and confirming in the successor
Trustee all such rights, powers, duties and obligations.
No successor Trustee shall accept appointment as provided in
this Section 8.08 unless at the time of such acceptance such successor Trustee
shall be eligible under the provisions of Section 8.06 and the appointment of
such successor Trustee shall not result in a downgrading of the Regular
Certificates by any Rating Agency, as evidenced by a letter from each Rating
Agency.
Upon acceptance of appointment by a successor Trustee as
provided in this Section 8.08, the successor Trustee shall mail notice of the
appointment of a successor Trustee hereunder to all Holders of Certificates at
their addresses as shown in the Certificate Register and to each Rating Agency.
Section 8.09 Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted
or with which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such entity shall be eligible under the provisions of
Section 8.06 and 8.08, 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.
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 or any Mortgaged Property 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, and to vest in such Person or Persons, in such capacity and for the
benefit of the Certificateholders, such title to the Trust, or any part thereof,
and, subject to the other provisions of this Section 8.10, such powers, duties,
obligations, rights and trusts as the Servicer and the Trustee may consider
necessary or desirable. Any such co-trustee or separate trustee shall be subject
to the written approval of the Servicer. If the Servicer 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 Servicer Event of Termination 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
Certificateholders of the appointment of any co-trustee or separate trustee
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shall be required under Section 8.08. The Servicer shall be responsible for the
fees of any co-trustee or separate trustee appointed hereunder.
Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) 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 in 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 hereunder 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 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;
(ii) no trustee hereunder shall be held personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Servicer and the Trustee, acting jointly may at any
time accept the resignation of or remove any separate trustee or
co-trustee except that following the occurrence of a Servicer Event of
Termination, the Trustee acting alone may accept the resignation 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 the provisions
of this Agreement, specifically including every provision 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, the Rating Agencies and the Servicer.
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 Limitation of Liability.
The Certificates are executed by the Trustee, not in its
individual capacity but solely as Trustee of the Trust, in the exercise of the
powers and authority conferred and vested in it by this Agreement. Each of the
undertakings and agreements made on the part of the Trustee
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in the Certificates is made and intended not as a personal undertaking or
agreement by the Trustee but is made and intended for the purpose of binding
only the Trust.
Section 8.12 Trustee May Enforce Claims Without Possession of
Certificates.
(a) All rights of action and claims under this Agreement or
the Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee for the benefit of all
Holders of such Certificates, subject to the provisions of this Agreement. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursement and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.
(b) The Trustee shall afford the Seller, the Depositor, the
Servicer and each Certificateholder upon reasonable notice during normal
business hours, access to all records maintained by the Trustee in respect of
its duties hereunder and access to officers of the Trustee responsible for
performing such duties. The Trustee shall cooperate fully with the Seller, the
Servicer, the Depositor and such Certificateholder and shall make available to
the Seller, the Servicer, the Depositor and such Certificateholder for review
and copying at the expense of the party requesting such copies, such books,
documents or records as may be requested with respect to the Trustee's duties
hereunder. The Seller, the Depositor, the Servicer and the Certificateholders
shall not have any responsibility or liability for any action or failure to act
by the Trustee and are not obligated to supervise the performance of the Trustee
under this Agreement or otherwise.
Section 8.13 Suits for Enforcement.
In case a Servicer Event of Termination or other default by
the Servicer or the Seller hereunder shall occur and be continuing, the Trustee
may proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy, as the Trustee, being advised by counsel, and subject
to the foregoing, shall deem most effectual to protect and enforce any of the
rights of the Trustee and the Certificateholders.
Section 8.14 Waiver of Bond Requirement.
The Trustee shall be relieved of, and each Certificateholder
hereby waives, any requirement of any jurisdiction in which the Trust, or any
part thereof, may be located that the Trustee post a bond or other surety with
any court, agency or body whatsoever.
Section 8.15 Waiver of Inventory, Accounting and Appraisal
Requirement.
The Trustee shall be relieved of, and each Certificateholder
hereby waives, any requirement of any jurisdiction in which the Trust, or any
part thereof, may be located that the
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Trustee file any inventory, accounting or appraisal of the Trust with any court,
agency or body at any time or in any manner whatsoever.
Section 8.16 Compliance with National Housing Act of 1934.
In performing its duties hereunder with respect to FHA Loans,
the Trustee shall comply with all requirements of the National Housing Act of
1934, as amended.
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ARTICLE IX
REMIC ADMINISTRATION
Section 9.01 REMIC Administration.
(a) REMIC elections as set forth in the Preliminary Statement
shall be made by the Trustee on Form 1066 or other appropriate federal tax or
information return for the taxable year ending on the last day of the calendar
year in which the Certificates are issued. The regular interests and residual
interest in each REMIC shall be as designated in the Preliminary Statement.
(b) The Closing Date is hereby designated as the "Startup Day"
of each REMIC within the meaning of section 860G(a)(9) of the Code.
(c) The Servicer shall pay any and all tax related expenses
(not including taxes) of each REMIC, including but not limited to any
professional fees or expenses related to audits or any administrative or
judicial proceedings with respect to each REMIC that involve the Internal
Revenue Service or state tax authorities, but only to the extent that (i) such
expenses are ordinary or routine expenses, including expenses of a routine audit
but not expenses of litigation (except as described in (ii)); or (ii) such
expenses or liabilities (including taxes and penalties) are attributable to the
negligence or willful misconduct of the Servicer in fulfilling its duties
hereunder. The Servicer shall be entitled to reimbursement of expenses to the
extent provided in clause (i) above from the Collection Account.
(d) The Trustee shall prepare, sign and file, all of the
REMICs' federal and state tax and information returns as the direct
representative each REMIC created hereunder. The expenses of preparing and
filing such returns shall be borne by the Trustee.
(e) The Holder of the Residual Certificate at any time holding
the largest Percentage Interest thereof shall be the "tax matters person" as
defined in the REMIC Provisions (the "Tax Matters Person") with respect to each
REMIC and shall act as Tax Matters Person for each REMIC. The Trustee, as agent
for the Tax Matters Person, shall perform on behalf of each REMIC all reporting
and other tax compliance duties that are the responsibility of such REMIC under
the Code, the REMIC Provisions, or other compliance guidance issued by the
Internal Revenue Service or any state or local taxing authority. Among its other
duties, if required by the Code, the REMIC Provisions, or other such guidance,
the Trustee, as agent for the Tax Matters Person, shall provide (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate to
any disqualified person or organization and (ii) to the Certificateholders such
information or reports as are required by the Code or REMIC Provisions. The
Trustee, as agent for the Tax Matters Person, shall represent each REMIC in any
administrative or judicial proceedings relating to an examination or audit by
any governmental taxing authority, request an administrative adjustment as to
any taxable year of any REMIC, enter into settlement agreements with any
government taxing agency, extend any statute of limitations relating to any item
of any REMIC and otherwise act on behalf of any REMIC in relation to any tax
matter involving the Trust.
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(f) The Trustee, the Servicer and the Holders of Certificates
shall take any action or cause the REMIC to take any action necessary to create
or maintain the status of each REMIC as a REMIC under the REMIC Provisions and
shall assist each other as necessary to create or maintain such status. Neither
the Trustee, the Servicer nor the Holder of any Residual Certificate shall take
any action, cause any REMIC created hereunder to take any action or fail to take
(or fail to cause to be taken) any action that, under the REMIC Provisions, if
taken or not taken, as the case may be, could (i) endanger the status of such
REMIC as a REMIC or (ii) result in the imposition of a tax upon such REMIC
(including but not limited to the tax on prohibited transactions as defined in
Code Section 860F(a)(2) and the tax on prohibited contributions set forth on
Section 860G(d) of the Code) (either such event, an "Adverse REMIC Event")
unless the Trustee and the Servicer have received an Opinion of Counsel (at the
expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such status or result in the imposition of
such a tax. In addition, prior to taking any action with respect to any REMIC
created hereunder or the assets therein, or causing such REMIC to take any
action, which is not expressly permitted under the terms of this Agreement, any
Holder of a Residual Certificate will consult with the Trustee and the Servicer,
or their respective designees, in writing, with respect to whether such action
could cause an Adverse REMIC Event to occur with respect to any REMIC, and no
such Person shall take any such action or cause any REMIC to take any such
action as to which the Trustee or the Servicer has advised it in writing that an
Adverse REMIC Event could occur.
(g) Each Holder of a Residual Certificate shall pay when due
any and all taxes imposed on each REMIC created hereunder by federal or state
governmental authorities. To the extent that such Trust taxes are not paid by a
Residual Certificateholder, the Trustee shall pay any remaining REMIC taxes out
of current or future amounts otherwise distributable to the Holder of the
Residual Certificate in the REMICs or, if no such amounts are available, out of
other amounts held in the Distribution Account, and shall reduce amounts
otherwise payable to Holders of regular interests in the related REMIC.
(h) The Trustee, as agent for the Tax Matters Person, shall,
for federal income tax purposes, maintain books and records with respect to each
REMIC created hereunder on a calendar year and on an accrual basis.
(i) No additional contributions of assets shall be made to any
REMIC created hereunder, except as expressly provided in this Agreement with
respect to Eligible Substitute Mortgage Loans.
(j) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any REMIC created hereunder will receive a fee or other
compensation for services.
(k) On or before April 15th of each calendar year beginning in
2005, the Servicer shall deliver to the Trustee and each Rating Agency an
Officers' Certificate stating the Servicer's compliance with the provisions of
this Section 9.01.
(l) The Trustee will apply for an Employee Identification
Number from the Internal Revenue Service via a Form SS-4 or other acceptable
method for all tax entities and shall complete the Form 8811.
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(m) For federal income tax purposes, in the event that the
beneficial ownership of the Class N Certificates and the Class X Certificates is
held by separate persons for tax purposes, the Trustee shall treat the Class N
Certificates as debt of the Class X Certificateholders for federal income tax
purposes and shall not treat such Class of Certificates as an interest in any
REMIC created hereunder. In the event that the beneficial ownership of the Class
N Certificates and the Class X Certificates is held by the same person, the
Trustee shall treat the Class N Certificates as not having been issued for
federal income tax purposes so that the entire economic entitlement of the Class
N Certificates and Class X Certificates (excluding the Class X Certificates
right to receive amounts from the Net WAC Rate Carryover Reserve Account) will
represent a "regular interest" in REMIC 6.
Section 9.02 Prohibited Transactions and Activities.
Neither the Seller, the Depositor, the Servicer nor the
Trustee shall sell, dispose of, or substitute for any of the Mortgage Loans,
except in a disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii)
the bankruptcy of the Trust Fund, (iii) the termination of any REMIC created
hereunder pursuant to Article X of this Agreement, (iv) a substitution pursuant
to Article II of this Agreement or (v) a repurchase of Mortgage Loans pursuant
to Article II of this Agreement, nor acquire any assets for any REMIC, nor sell
or dispose of any investments in the Distribution Account for gain, nor accept
any contributions to either REMIC after the Closing Date, unless it has received
an Opinion of Counsel (at the expense of the party causing such sale,
disposition, or substitution) that such disposition, acquisition, substitution,
or acceptance will not (a) affect adversely the status of any REMIC created
hereunder as a REMIC or of the interests therein other than the Residual
Certificates as the regular interests therein, (b) affect the distribution of
interest or principal on the Certificates, (c) result in the encumbrance of the
assets transferred or assigned to the Trust Fund (except pursuant to the
provisions of this Agreement) or (d) cause any REMIC created hereunder to be
subject to a tax on prohibited transactions or prohibited contributions pursuant
to the REMIC Provisions.
Section 9.03 Indemnification with Respect to Certain Taxes and
Loss of REMIC Status.
In the event that any REMIC fails to qualify as a REMIC, loses
its status as a REMIC, or incurs federal, state or local taxes as a result of a
prohibited transaction or prohibited contribution under the REMIC Provisions due
to the negligent performance by the Servicer of its duties and obligations set
forth herein, the Servicer shall indemnify the Holder of the related Residual
Certificates against any and all losses, claims, damages, liabilities or
expenses ("Losses") resulting from such negligence; provided, however, that the
Servicer shall not be liable for any such Losses attributable to the action or
inaction of the Trustee, the Depositor or the Holder of such Residual
Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which the
Servicer has relied. The foregoing shall not be deemed to limit or restrict the
rights and remedies of the Holder of such Residual Certificate now or hereafter
existing at law or in equity. Notwithstanding the foregoing, however, in no
event shall the Servicer have any liability (1) for any action or omission that
is taken in accordance with and in compliance with the express terms of, or
which is expressly permitted by the terms of, this Agreement, (2) for any Losses
other than arising out of a negligent performance by the Servicer of its duties
and obligations set forth
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herein, and (3) for any special or consequential damages to Certificateholders
(in addition to payment of principal and interest on the Certificates).
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ARTICLE X
TERMINATION
Section 10.01 Termination.
(a) The respective obligations and responsibilities of the
Seller, the Servicer, the Depositor, the Trustee and the Certificate Registrar
created hereby (other than the obligation of the Trustee to make certain
payments to Certificateholders after the final Distribution Date and the
obligation of the Servicer to send certain notices as hereinafter set forth)
shall terminate upon notice to the Trustee upon the earliest of (i) the
Distribution Date on which the Certificate Principal Balance of each Class of
Certificates has been reduced to zero, (ii) the final payment or other
liquidation of the last Mortgage Loan in the Trust, and (iii) the optional
purchase by the Servicer or an Affiliate of the Servicer of the Mortgage Loans
as described below. Notwithstanding the foregoing, in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late ambassador of
the United States to the Court of St. ▇▇▇▇▇, living on the date hereof.
The Servicer or an Affiliate of the Servicer may, at its
option, terminate the Mortgage Loans in the Trust Fund and retire the Class A
Certificates and the Mezzanine Certificates on the next succeeding Distribution
Date upon which the current Pool Balance is less than 10% of the Pool Balance of
the Mortgage Loans as of the Cut-off Date by purchasing all of the outstanding
(i) Mortgage Loans in the Trust Fund at a price equal to the sum of the
outstanding Principal Balance of the Mortgage Loans and except to the extent
previously advanced by the Servicer, accrued and unpaid interest thereon at the
weighted average of the Mortgage Interest Rates through the end of the
Collection Period preceding the final Distribution Date plus unreimbursed
Servicing Advances, Advances and any unpaid Servicing Fees allocable to such
Mortgage Loans and (ii) REO Properties in the Trust Fund at a price equal to
their fair market value as determined in good faith by the Servicer (the
"Termination Price").
In connection with any such purchase pursuant to the preceding
paragraph, the Servicer shall deliver to the Trustee for deposit in the
Distribution Account all amounts then on deposit in the Collection Account (less
amounts permitted to be withdrawn by the Servicer pursuant to Section 3.07),
which deposit shall be deemed to have occurred immediately following such
purchase.
Any such purchase shall be accomplished by delivery to the
Trustee for deposit into the Distribution Account as part of Available Funds on
the Determination Date before such Distribution Date of the Termination Price.
(b) Notice of any termination, specifying the Distribution
Date (which shall be a date that would otherwise be a Distribution Date) upon
which the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee upon the Trustee receiving notice of such date from the Servicer, by
letter to the Certificateholders mailed not earlier than the 15th day of the
month preceding the month of such final distribution and not later than the 15th
day of the month of
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such final distribution specifying (1) the Distribution Date upon which final
distribution of the Certificates will be made upon presentation and surrender of
such Certificates at the office or agency of the Trustee therein designated, (2)
the amount of any such final distribution and (3) that the Record Date otherwise
applicable to such Distribution Date is not applicable, distributions being made
only upon presentation and surrender of the Certificates at the office or agency
of the Trustee therein specified.
(c) Upon presentation and surrender of the Certificates, the
Trustee shall cause to be distributed to the Holders of the Certificates on the
Distribution Date for such final distribution, in proportion to the Percentage
Interests of their respective Class and to the extent that funds are available
for such purpose, an amount equal to the amount required to be distributed to
such Holders in accordance with the provisions of Sections 4.01 and Section 4.02
for such Distribution Date.
(d) In the event that all Certificateholders shall not
surrender their Certificates for final payment and cancellation on or before
such final Distribution Date, the Trustee shall promptly following such date
cause all funds in the Distribution Account not distributed in final
distribution to Certificateholders to be withdrawn therefrom and credited to the
remaining Certificateholders by depositing such funds in a separate escrow
account for the benefit of such Certificateholders, and the Servicer (if the
Servicer has exercised its right to purchase the Mortgage Loans) or the Trustee
(in any other case) 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 nine months after the
second notice all the Certificates shall not have been surrendered for
cancellation, the Residual Certificateholders shall be entitled to all unclaimed
funds and other assets which remain subject hereto and the Trustee upon transfer
of such funds shall be discharged of any responsibility for such funds, and such
Certificateholders shall look to the Residual Certificateholders for payment.
Section 10.02 Additional Termination Requirements.
(a) In the event that the Servicer exercises its purchase
option as provided in Section 10.01, the Trust shall be terminated in accordance
with the following additional requirements, unless the Trustee shall have been
furnished with an Opinion of Counsel to the effect that the failure of the Trust
to comply with the requirements of this Section will not (i) result in the
imposition of taxes on "prohibited transactions" of the Trust as defined in
Section 860F of the Code or (ii) cause any REMIC constituting part of the Trust
Fund to fail to qualify as a REMIC at any time that any Certificates are
outstanding:
(i) The Trustee shall designate a date within 90 days prior to
the final Distribution Date as the date of adoption of plans of
complete liquidation of each REMIC and shall specify such date in the
final federal income tax return of each REMIC;
(ii) After the date of adoption of such plans of complete
liquidation and at or prior to the final Distribution Date, the
Trustee shall sell all of the assets of the Trust to the Servicer for
cash; and
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(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited in the following order of priority (A) (i) to
the Holders of the Class A Certificates and (ii) to the Class M-1,
Class M- 2, Class M-3, Class B-1, Class B-2, Class B-3 and Class B-4
Certificates, the related Certificate Principal Balance, as
applicable, plus one month's interest thereon at the applicable
Pass-Through Rate, (B) to the Class N and Class X Certificates in
respect of the Class X/N Interest, the amount of any remaining Monthly
Excess Cash Flow Amounts not previously distributed thereon, (C) to
the remaining REMIC Regular Interests the amounts allocable thereto
pursuant to Section 4.08 and (D) to the Class R and Class R-X
Certificateholders, all cash on hand in respect of the related REMIC
or REMICs after such payment (other than cash retained to meet claims)
and the Trust shall terminate at such time.
(b) By their acceptance of Certificates, the Holders thereof
hereby agree to appoint the Trustee as their attorney in fact to: (i) designate
such date of adoption of plans of complete liquidation and (ii) to take such
other action in connection therewith as may be reasonably required to carry out
such plans of complete liquidation all in accordance with the terms hereof.
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ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.
This Agreement may be amended from time to time by the Seller,
the Depositor, the Servicer and the Trustee; and without the consent of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or inconsistent with any other
provisions herein, (iii) to amend the provisions of Section 3.22, (iv) to make
any other provisions with respect to matters or questions arising under this
Agreement, which shall not be inconsistent with the provisions of this Agreement
or (v) to comply with any rules of the Securities and Exchange Commission
promulgated following the date hereof which apply to the Certificates; provided,
however, that any such action listed in clause (i) through (iv) above shall not
adversely affect in any respect the interests of any Certificateholder, as
evidenced by (i) notice in writing to the Depositor, the Servicer and the
Trustee from the Rating Agencies that such action will not result in the
reduction or withdrawal of the rating of any outstanding Class of Certificates
with respect to which it is a Rating Agency, or (ii) an Opinion of Counsel
delivered to the Servicer and the Trustee.
In addition, this Agreement may be amended from time to time
by Seller, the Depositor, the Servicer and the Trustee, with the consent of the
Majority Certificateholders 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 Certificates; provided,
however, that no such amendment or waiver shall (x) reduce in any manner the
amount of, or delay the timing of, payments on the Certificates which are
required to be made on any Certificate without the consent of the Holder of such
Certificate, (y) adversely affect in any material respect the interests of the
Holders of any Class of Certificates (as evidenced by (i) notice in writing to
the Depositor, the Servicer and the Trustee from the Rating Agencies that such
action will not result in the reduction or withdrawal of the rating of any
outstanding Class of Certificates with respect to which it is a Rating Agency,
or (ii) an Opinion of Counsel delivered to the Servicer and the Trustee) in a
manner other than as described in clause (x) above, without the consent of the
Holders of Certificates of such Class evidencing at least a 66% Percentage
Interest in such Class, or (z) reduce the percentage of Voting Rights required
by clause (y) above without the consent of the Holders of all Certificates of
such Class then outstanding. Upon approval of an amendment, a copy of such
amendment shall be sent to the Rating Agencies. Prior to the execution of any
amendment to this Agreement, the Trustee shall be entitled to receive and rely
upon an Opinion of Counsel (at the expense of the Person seeking such amendment)
stating that the execution of such amendment is authorized or permitted by this
Agreement. The Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Trustee's own rights, duties or immunities under
this Agreement.
Notwithstanding any provision of this Agreement to the
contrary, the Trustee shall not consent to any amendment to this Agreement
unless it shall have first received an Opinion of Counsel, delivered by (and at
the expense of) the Person seeking such Amendment, to the effect that such
amendment will not result in the imposition of a tax on any REMIC constituting
part of the Trust Fund pursuant to the REMIC Provisions or cause any REMIC
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constituting part of the Trust to fail to qualify as a REMIC at any time that
any Certificates are outstanding and that the amendment is being made in
accordance with the terms hereof.
Promptly after the execution of any such amendment the Trustee
shall furnish, at the expense of the Person that requested the amendment if such
Person is the Seller or the Servicer (but in no event at the expense of the
Trustee), otherwise at the expense of the Trust, a copy of such amendment and
the Opinion of Counsel referred to in the immediately preceding paragraph to the
Servicer and each Rating Agency.
It shall not be necessary for the consent of
Certificateholders under this Section 11.01 to approve the particular form of
any proposed amendment; instead 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 Certificateholders
shall be subject to such reasonable regulations as the Trustee may prescribe.
Section 11.02 Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, 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 any other
appropriate public recording office or elsewhere, such recordation to be
effected by the Servicer at the expense of the Trust, but only upon direction of
Certificateholders, accompanied by an Opinion of Counsel to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders.
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
together constitute but one and the same instrument.
Section 11.03 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not (i)
operate to terminate this Agreement or the Trust, (ii) entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust, or (iii) otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
Except as expressly provided for herein, no Certificateholder
shall have any right to vote or in any manner otherwise control the operation
and management of the Trust, 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 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 of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with
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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 herein
provided, and unless also the Holders of Certificates entitled to at least 25%
of the Voting Rights 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 15 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 is understood and intended, and 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 of any provision of this Agreement to affect, disturb
or prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
which priority or preference is not otherwise provided for herein, 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 11.03 each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 11.04 Governing Law; Jurisdiction.
This Agreement shall be construed in accordance with the laws
of the State of New York, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws (without
regard to the conflicts of laws provisions thereof). With respect to any claim
arising out of this Agreement, each party irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York and the United States
District Court located in the Borough of Manhattan in The City of New York, and
each party irrevocably waives any objection which it may have at any time to the
laying of venue of any suit, action or proceeding arising out of or relating
hereto brought in any such courts, irrevocably waives any claim that any such
suit, action or proceeding brought in any such court has been brought in any
inconvenient forum and further irrevocably waives the right to object, with
respect to such claim, suit, action or proceeding brought in any such court,
that such court does not have jurisdiction over such party, provided that
service of process has been made by any lawful means.
Section 11.05 Notices.
All directions, demands and notices hereunder shall be in
writing and shall be deemed to have been duly given if personally delivered at
or mailed by first class mail, postage prepaid, or by express delivery service,
to (a) in the case of the Seller, Credit-Based Asset Servicing and
Securitization LLC, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇,
Attention: Director - Mortgage Finance (telecopy number (▇▇▇) ▇▇▇-▇▇▇▇), or such
other address or telecopy number as may hereafter be furnished to the Depositor
and the Trustee in writing by the Seller, (b) in the case of the Trustee, U.S.
Bank National Association, ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇-▇▇▇▇, ▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, Attn: Structured Finance--Citigroup C-BASS 2004-CB7, or such other
address as may hereafter be furnished to the Depositor, the Seller and the
Servicer in writing by the Trustee, (c) in the case of the Depositor, Citigroup
Mortgage Loan Trust Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ Attention: Mortgage Finance, or such other address as may be furnished to
the
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Seller, the Servicer and the Trustee in writing by the Depositor, and (d) in the
case of the Servicer, ▇▇▇▇▇▇ Loan Servicing LP, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, or such other address as may be
furnished to the Seller, the Depositor and the Trustee in writing by the
Servicer. 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. Notice of any Servicer Event of
Termination shall be given by telecopy and by certified mail. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have duly been given when mailed, whether or not the
Certificateholder receives such notice. A copy of any notice required to be
telecopied hereunder shall also be mailed to the appropriate party in the manner
set forth above.
Section 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall for any reason whatsoever be held invalid, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions of
this Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.07 Article and Section References.
All article and section references used in this Agreement,
unless otherwise provided, are to articles and sections in this Agreement.
Section 11.08 Notice to the Rating Agencies.
(a) Each of the Trustee and the Servicer shall be obligated to
use its best reasonable efforts promptly to provide notice to the Rating
Agencies with respect to each of the following of which a Responsible Officer of
the Trustee or the Servicer, as the case may be, has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Servicer Event of Termination that has
not been cured or waived;
(iii) the resignation or termination of the Servicer or the
Trustee;
(iv) the final payment to Holders of the Certificates of any
Class;
(v) any change in the location of any Account; and
(vi) if the Trustee is acting as successor Servicer pursuant to
Section 7.02 hereof, any event that would result in the inability of
the Trustee to make Advances.
(vii) In addition, the Servicer shall promptly furnish to each
Rating Agency copies of the following:
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(A) each annual statement as to compliance described in
Section 3.19 hereof;
(B) each annual independent public accountants' servicing
report described in Section 3.20 hereof; and
(C) each notice delivered pursuant to Section 7.01(a) hereof
which relates to the fact that the Servicer has not made an Advance.
Any such notice pursuant to this Section 11.08 shall be in
writing and shall be deemed to have been duly given if personally delivered or
mailed by first class mail, postage prepaid, or by express delivery service to
▇▇▇▇▇'▇ Investors Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Managing Director, Residential Mortgage-Backed Securities; Fitch
Ratings, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Managing
Director, Residential Mortgage-Backed Securities; Standard & Poor's, a division
of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Mortgage Surveillance Group; and Dominion Bond Rating Service, Inc.,
▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
Section 11.09 Further Assurances.
Notwithstanding any other provision of this Agreement, neither
the Regular Certificateholders nor the Trustee shall have any obligation to
consent to any amendment or modification of this Agreement unless they have been
provided reasonable security or indemnity against their out-of-pocket expenses
(including reasonable attorneys' fees) to be incurred in connection therewith.
Section 11.10 Benefits of Agreement.
Nothing in this Agreement or in the Certificates, expressed or
implied, shall give to any Person, other than the Certificateholders and the
parties hereto and their successors hereunder, any benefit or any legal or
equitable right, remedy or claim under this Agreement.
Section 11.11 Acts of Certificateholders.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given or taken
by the Certificateholders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Certificateholders in
person or by agent duly appointed in writing; and such action shall become
effective when such instrument or instruments are delivered to the Trustee, the
Seller and the Servicer. Such instrument or instruments (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "act" of
the Certificateholders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee and the Trust, if made in the manner provided in this Section 11.11.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of a
- 154 -
notary public or other officer authorized by law to take acknowledgments of
deeds, certifying that the individual signing such instrument or writing
acknowledged to him the execution thereof. Whenever such execution is by a
signer acting in a capacity other than his or her individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority.
(c) Any request, demand, authorization, direction, notice,
consent, waiver or other action by any Certificateholder shall bind every future
Holder of such Certificate and the Holder of every Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Trustee or the
Trust in reliance thereon, whether or not notation of such action is made upon
such Certificate.
- 155 -
IN WITNESS WHEREOF, the Seller, the Depositor, the Servicer
and the Trustee have caused their names to be signed hereto by their respective
officers thereunto duly authorized, all as of the day and year first above
written.
CITIGROUP MORTGAGE LOAN TRUST INC., as Depositor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Asst. Vice President
CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC,
as Seller
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇▇ LOAN SERVICING LP, as Servicer
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
U.S. BANK NATIONAL
ASSOCIATION, as Trustee
By: /s/ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
-------------------------------------------------
Name: ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 29th day of October, 2004 before me, a notary public in
and for said State, personally appeared ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, known to me to be an
Asst. Vice President of Citigroup Mortgage Loan Trust Inc., a Delaware
corporation that executed the within instrument, and also known to me to be the
person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
Notary Public
Commission Expires Sept. 13, ▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
) ss.:
COUNTY OF NEW YORK )
On the 29th day of October 2004 before me, a notary public in
and for said State, personally appeared ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ known to me to be a
Vice President of Credit-Based Asset Servicing and Securitization LLC, a limited
liability company that executed the within instrument, and also known to me to
be the person who executed it on behalf of said limited liability company, and
acknowledged to me that such limited liability company executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Notary Public
Commission Expires Jan. 31, ▇▇▇▇
▇▇▇▇▇ ▇▇ )
▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ) ss.:
COUNTY OF ▇▇▇▇▇▇ )
On the 29th day of October 2004 before me, a notary public in
and for said State, personally appeared ▇. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇, known to me to be a
Vice President of U.S. Bank National Association, a national banking association
that executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
-------------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
Notary Public
Commission Expires Jan. 31, ▇▇▇▇
▇▇▇▇▇ ▇▇ ▇▇▇▇▇ )
) ss.:
COUNTY OF ▇▇▇▇▇▇ )
On the 29th day of October 2004 before me, a notary public in
and for said State, personally appeared ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, known to me to be a Vice
President of ▇▇▇▇▇▇ Loan Servicing LP, a Delaware limited partnership, that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said limited partnership, and acknowledged to me that
such limited partnership executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ ▇. ▇▇▇▇▇▇
-------------------------------------------------
A. Mille
Notary Public- State of Texas
Commission Expires Apr. 28, 2006
EXHIBIT A-1
FORM OF CLASS AV-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
A-1-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AV-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AV-1 Original Class Certificate Principal
Balance of the Class AV-1 Certificates
as of the Closing
Pass-Through Rate: Variable Date: $137,409,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $137,409,000.00
First Distribution Date: Servicer: ▇▇▇▇▇▇ Loan Servicing LP
November 26, 2004
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LE 6 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-1-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AV-1 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AV-1 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-1 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AV-1 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class AV-1 Certificate Margin and (ii) the related Rate Cap for the such
Distribution Date. Interest will accrue on the Class AV-1 Certificates during
each Interest Accrual Period at the Class AV-1 Pass-Through Rate.
A-1-3
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AV-1 Certificates.
The Class AV-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the
A-1-4
Depositor, the Servicer, the Trustee, the Certificate Registrar nor any such
agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
-----------------------------
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
------------------------------------------------------------------------------
Dated:
--------------------------------------
Signature by or on behalf of assignor
--------------------------------------
Signature Guaranteed
A-1-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to
______________________________________________________________________________
for the account of _________________________________ , account number
_______________, of, if mailed by check, to
______________________________________________________________________________
This information is provided by ___________________________, the assignee named
above, or ______________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AV-2A CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
A-2-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AV-2A
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AV-2A Original Class Certificate Principal
Balance of the Class AV-2A Certificates
as of the Closing
Pass-Through Rate: Variable Date: $82,422,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $82,422,000.00
First Distribution Date: Servicer: ▇▇▇▇▇▇ Loan Servicing LP
November 26, 2004
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LF 6 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-2-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AV-2A Certificates) in that certain beneficial ownership interest evidenced by
all the Class AV-2A Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-2A Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-2A Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-2A
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AV-2A Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class AV-2A Certificate Margin and (ii) the related Rate Cap for the such
Distribution Date. Interest will accrue on the Class AV-2A Certificates during
each Interest Accrual Period at the Class AV-2A Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof
A-2-3
(herein called the "Certificates") and representing a Percentage Interest in the
Class AV-2A Certificates.
The Class AV-2A Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
A-2-4
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.
A-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
-----------------------------
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____%
evidenced by the within asset-backed Certificate and hereby authorize(s) the
registration of transfer of such interest to assignee on the Certificate
Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
------------------------------------------------------------------------------
Dated:
--------------------------------------
Signature by or on behalf of assignor
--------------------------------------
Signature Guaranteed
A-2-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to
_____________________________________________________________________________
for the account of _______________________________, account number
, or, if mailed by check, to ____________________________________
Applicable statements should be mailed to
______________________________________________________________________________
This information is provided by _________________________________ ,the assignee
named above, or_______________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AV-2B CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
A-3-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AV-2B
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AV-2B Original Class Certificate Principal
Balance of the Class AV-2B Certificates
as of the Closing
Pass-Through Rate: Variable Date: $28607,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $28,607,000.00
First Distribution Date: Servicer: ▇▇▇▇▇▇ Loan Servicing LP
November 26, 2004
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LG 1 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-3-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AV-2B Certificates) in that certain beneficial ownership interest evidenced by
all the Class AV-2B Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-2B Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-2B Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-2B
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AV-2B Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class AV-2B Certificate Margin and (ii) the related Rate Cap for the such
Distribution Date. Interest will accrue on the Class AV-2B Certificates during
each Interest Accrual Period at the Class AV-2B Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof
A-3-3
(herein called the "Certificates") and representing a Percentage Interest in the
Class AV-2B Certificates.
The Class AV-2B Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
A-3-4
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-3-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and
Taxpayer Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
________________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of assignor
_____________________________________
Signature Guaranteed
A-3-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to ___________________________________________________.
_______________________________________________________________________________
Applicable statements should be mailed to _____________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AV-2C CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO 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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
A-4-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AV-2C
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AV-2C Original Class Certificate Principal Balance of
the Class AV-2C Certificates as of the Closing
Pass-Through Rate: Variable Date: $26,379,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $26,379,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LH 9 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-4-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AV-2C Certificates) in that certain beneficial ownership interest evidenced by
all the Class AV-2C Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AV-2C Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV-2C Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AV-2C
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AV-2C Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class AV-2C Certificate Margin and (ii) the related Rate Cap for the such
Distribution Date. Interest will accrue on the Class AV-2C Certificates during
each Interest Accrual Period at the Class AV-2C Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof
A-4-3
(herein called the "Certificates") and representing a Percentage Interest in the
Class AV-2C Certificates.
The Class AV-2C Certificates are limited in right of payment to
certain collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
A-4-4
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-4-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
A-4-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
____________________________________________________or, if mailed by check, to.
Applicable statements should be mailed to______________________________________
This information is provided by _________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
A-5-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AF-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by CITIGROUP
MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AF-1 Original Class Certificate Principal Balance of
the Class AF-1 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 54,510,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $ 54,510,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LJ 5 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-5-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-1 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-1 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AF-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AF-1 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AF-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-1 Pass-Through Rate on each Distribution Date will be a
fixed rate per annum equal to 3.128%, subject to a rate cap and subject to
increase by 0.50% for each interest accrual period following the distribution
date on which the aggregate principal balance of the mortgage loans remaining in
the trust is reduced to less than 10% of the aggregate principal balance of the
mortgage loans as of the cut-off date. Interest will accrue on the Class AF-1
Certificates during each Interest Accrual Period at the Class AF-1 Pass-Through
Rate.
A-5-3
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-1 Certificates.
The Class AF-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the
A-5-4
Depositor, the Servicer, the Trustee, the Certificate Registrar nor any such
agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-5-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s)
unto___________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
A-5-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________
_______________________________________________________________________________
for the account of __________________________, account number_________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
A-6-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AF-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by CITIGROUP
MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AF-2 Original Class Certificate Principal Balance of
the Class AF-2 Certificates as of the Closing
Pass-Through Rate: Fixed Date: $ 25,657,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $ 25,657,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LK 2 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-6-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-2 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-2 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AF-2 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AF-2 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AF-2
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-2 Pass-Through Rate on each Distribution Date will be a
fixed rate per annum equal to 3.887%, subject to a rate cap and subject to
increase by 0.50% for each interest accrual period following the distribution
date on which the aggregate principal balance of the mortgage loans remaining in
the trust is reduced to less than 10% of the aggregate principal balance of the
mortgage loans as of the cut-off date. Interest will accrue on the Class AF-2
Certificates during each Interest Accrual Period at the Class AF-2 Pass-Through
Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof
A-6-3
(herein called the "Certificates") and representing a Percentage Interest in the
Class AF-2 Certificates.
The Class AF-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
A-6-4
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-6-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
A-6-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of __________________________, account number_________________,
or, if mailed by check, to_____________________________________________________
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-3 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
A-7-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AF-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AF-3 Original Class Certificate Principal Balance of
the Class AF-3 Certificates as of the Closing
Pass-Through Rate: Fixed Date: $ 7,000,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $ 7,000,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LL 0 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-7-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-3 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-3 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AF-3 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AF-3 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AF-3
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-3 Pass-Through Rate on each Distribution Date will be a
fixed rate per annum equal to 4.644%, subject to a rate cap and subject to
increase by 0.50% for each interest accrual period following the distribution
date on which the aggregate principal balance of the mortgage loans remaining in
the trust is reduced to less than 10% of the aggregate
A-7-3
principal balance of the mortgage loans as of the cut-off date. Interest will
accrue on the Class AF-3 Certificates during each Interest Accrual Period at the
Class AF-3 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-3 Certificates.
The Class AF-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any
A-7-4
tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-7-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto (Please print or typewrite name, address including postal zip
code, and Taxpayer Identification Number of assignee) a Percentage Interest
equal to ____% evidenced by the within asset-backed Certificate and hereby
authorize(s) the registration of transfer of such interest to assignee on the
Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
A-7-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
for the account of ________________________, account number___________________,
or, if mailed by check, to_____________________________________________________
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-4 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
A-8-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AF-4
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AF-4 Original Class Certificate Principal Balance of
the Class AF-4 Certificates as of the Closing
Pass-Through Rate: Fixed Date: $ 10,784,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $ 10,784,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LM 8 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-8-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-4 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-4 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AF-4 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AF-4 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AF-4
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-4 Pass-Through Rate on each Distribution Date will be a
fixed rate per annum equal to 5.118%, subject to a rate cap and subject to
increase by 0.50% for each interest accrual period following the distribution
date on which the aggregate principal balance of the mortgage loans remaining in
the trust is reduced to less than 10% of the aggregate principal balance of the
mortgage loans as of the cut-off date. Interest will accrue on the Class AF-4
Certificates during each Interest Accrual Period at the Class AF-4 Pass-Through
Rate.
A-8-3
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-4 Certificates.
The Class AF-4 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
A-8-4
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-8-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on
Ithe face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_____________________________________
Signature by or on behalf of assignor
_____________________________________
Signature Guaranteed
A-8-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of ___________________________, account number _______________,
or, if mailed by check, to . Applicable statements should be mailed
to_________________________________________________ This information is provided
by __________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS AF-5 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
A-9-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS AF-5
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class AF-5 Original Class Certificate Principal Balance of
the Class AF-5 Certificates as of the Closing Date: $
Pass-Through Rate: Fixed 13,893,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $ 13,893,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LN 6 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
A-9-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-5 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-5 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
AF-5 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AF-5 Certificate becomes a Definitive Certificate,
the Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class AF-5
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class AF-5 Pass-Through Rate on each Distribution Date will be a
fixed rate per annum equal to 4.585%, subject to a rate cap and subject to
increase by 0.50% for each interest accrual period following the distribution
date on which the aggregate principal balance of the mortgage loans remaining in
the trust is reduced to less than 10% of the aggregate principal balance of the
mortgage loans as of the cut-off date. Interest will accrue on the Class AF-5
Certificates during each Interest Accrual Period at the Class AF-5 Pass-Through
Rate.
A-9-3
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-5 Certificates.
The Class AF-5 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer and the Trustee
with the consent of the Holders of Certificates entitled to the Voting Rights
identified in the agreement. Any such consent by the Holder of this Certificate
shall be conclusive and binding on such Holder and upon all future Holders of
this Certificate and of any Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Certificate. The Agreement also permits the amendment thereof, in
certain limited circumstances, without the consent of the Holders of any of the
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
A-9-4
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-9-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October __, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
A-9-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of __________________________, account number_________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AND THE MEZZANINE CERTIFICATES AS DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
B-1-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS B-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class B-1 Original Class Certificate Principal Balance of
the Class B-1 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 6,004,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date:October 1, 2004 $ 6,004,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LS 5 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
B-1-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-1 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class B-1 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class B-1 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class B-1 Certificates during each Interest
Accrual Period at the Class B-1 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof
B-1-3
(herein called the "Certificates") and representing a Percentage Interest in the
Class B-1 Certificates.
The Class B-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates and the Class M Certificates as described in the Pooling and
Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
B-1-4
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
B-1-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of ____________________________, account number ______________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, THE MEZZANINE CERTIFICATES AND THE CLASS B-1
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY
OR TRANSFERRED TO ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION
LETTER STATING EITHER (A) THAT THE TRANSFEREE IS NOT AN EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT 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"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON BEHALF OF OR
INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF
FUNDS USED TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY
GENERAL ACCOUNT." EACH PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY
INTEREST THEREIN SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS
REQUIRED BY THE REPRESENTATION LETTER REFERRED TO IN THE PRECEDING
SENTENCE, UNLESS SUCH PERSON SHALL HAVE PROVIDED SUCH REPRESENTATION
LETTER REFERRED TO IN THE PRECEDING SENTENCE TO THE CERTIFICATE
REGISTRAR. THE POOLING AND SERVICING AGREEMENT PROVIDES THAT ANY
ATTEMPTED OR PURPORTED TRANSFER IN VIOLATION OF THESE TRANSFER
RESTRICTIONS WILL BE NULL AND VOID AND WILL VEST NO RIGHTS IN ANY
PURPORTED TRANSFEREE.
B-2-1
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
B-2-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS B-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class B-2 Original Class Certificate Principal Balance of
the Class B-2 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 5,283,000.00
Date of Pooling and Servicing Agreement Initial Certificate Principal Balance:
and Cut-off Date: October 1, 2004 $ 5,283,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LT 3 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
B-2-3
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-2 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-2 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-2
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class B-2 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class B-2 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class B-2 Certificates during each Interest
Accrual Period at the Class B-2 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-2 Certificates.
B-2-4
The Class B-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates, the Class M Certificates and the Class B-1 Certificates as
described in the Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the
B-2-5
Depositor, the Servicer, the Trustee, the Certificate Registrar nor any such
agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-2-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on
Ithe face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
B-2-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of ___________________________, account number _______________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-3 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO 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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, THE MEZZANINE CERTIFICATES, THE CLASS B-1 CERTIFICATES AND THE
CLASS B-2 CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN, THIS CERTIFICATE MAY NOT BE PURCHASED BY OR TRANSFERRED TO
ANY PERSON THAT HAS NOT DELIVERED A REPRESENTATION LETTER STATING EITHER (A)
THAT THE TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT 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"), (COLLECTIVELY, A "PLAN"), AND IS NOT ACTING ON
BEHALF OF OR INVESTING THE ASSETS OF A PLAN OR (B) SUBJECT TO CERTAIN CONDITIONS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT, THAT THE SOURCE OF FUNDS USED
TO PURCHASE THIS CERTIFICATE IS AN "INSURANCE COMPANY GENERAL ACCOUNT." EACH
PERSON WHO ACQUIRES THIS CERTIFICATE OR ANY INTEREST THEREIN SHALL BE DEEMED TO
HAVE MADE THE REPRESENTATIONS REQUIRED BY THE REPRESENTATION LETTER REFERRED TO
IN THE PRECEDING SENTENCE, UNLESS SUCH PERSON SHALL HAVE PROVIDED SUCH
REPRESENTATION LETTER REFERRED TO IN THE PRECEDING SENTENCE TO THE CERTIFICATE
REGISTRAR. THE POOLING AND SERVICING AGREEMENT PROVIDES THAT ANY ATTEMPTED OR
PURPORTED TRANSFER IN VIOLATION OF THESE TRANSFER RESTRICTIONS WILL BE NULL AND
VOID AND WILL VEST NO RIGHTS IN ANY PURPORTED TRANSFEREE.
B-3-1
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
B-3-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS B-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class B-3 Original Class Certificate Principal Balance of
the Class B-3 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 4,804,000.00
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance:
Cut-off Date: October 1, 2004 $ 4,804,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LU 0 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
B-3-3
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-3 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-3 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-3
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class B-3 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class B-3 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class B-3 Certificates during each Interest
Accrual Period at the Class B-3 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-3 Certificates.
B-3-4
The Class B-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates, the Class M Certificates, the Class B-1 Certificates and the Class
B-2 Certificates as described in the Pooling and Servicing Agreement referred to
herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the
B-3-5
Depositor, the Servicer, the Trustee, the Certificate Registrar nor any such
agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-3-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
B-3-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
for the account of __________________________, account number ________________,
or, if mailed by check, to ___________________________________________________.
Applicable statements should be mailed to _____________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF CLASS B-4 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, THE MEZZANINE CERTIFICATES, THE CLASS B-1 CERTIFICATES,
THE CLASS B-2 CERTIFICATES AND THE CLASS B-3 CERTIFICATES AS DESCRIBED
IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS B-4 CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER
DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE
SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED
EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
B-4-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS B-4
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class B-4 Original Class Certificate Principal Balance of
the Class B-4 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 7,445,000.00
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance:
Cut-off Date: October 1, 2004 $ 7,445,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LV 8 Closing Date: October 29, 2004
B-4-2
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-4
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-4 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
B-4 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class B-4 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class B-4
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class B-4 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class B-4 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class B-4 Certificates during each Interest
Accrual Period at the Class B-4 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-4 Certificates.
B-4-3
The Class B-4 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates, the Class M Certificates, the Class B-1 Certificates, the Class
B-2 Certificates and the Class B-3 Certificates as described in the Pooling and
Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) that the Depositor and the Certificate Registrar shall require an Opinion
of
B-4-4
Counsel satisfactory to them that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositor, the Trustee or the Certificate Registrar, in their respective
capacities as such. None of the Depositor, the Certificate Registrar nor the
Trustee is obligated to register or qualify the Class of Certificates specified
on the face hereof under the 1933 Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositor, the Certificate Registrar and any Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
No transfer of this Certificate or any interest herein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing this Certificate or interest herein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan unless the
opinion letter in section 5.02 of the Pooling and Servicing Agreement is
provided.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
B-4-5
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-4-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October , 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
B-4-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________
for the account of ___________________________, account number _______________,
or, if mailed by check, to ___________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
B-4-8
EXHIBIT C-1-1
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN SIX SEPARATE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE").
THIS CLASS R CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES
AND THE CLASS B-4 CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED
HEREIN AND IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER
DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE
SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED
EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT
TO THE CERTIFICATE REGISTRAR THAT SUCH TRANSFEREE IS NOT (A) THE
UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS
EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION
C-1-1-1
IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE, (C) ANY
ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH
PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C) BEING
HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D) AN
AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH
TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (3)
SUCH TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO
THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING
THE REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR
OTHER DISPOSITION OF THIS CLASS R CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT
WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT
LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH
HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH
AND THE PROVISIONS OF SECTION 5.02(D) OF THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED
ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS
CLASS R CERTIFICATE.
C-1-1-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS R
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class R Servicer: ▇▇▇▇▇▇ Loan Servicing LP
Date of Pooling and Servicing Agreement and Trustee: U.S. Bank National Association
Cut-off Date: October 1, 2004
Closing Date: October 29, 2004
First Distribution Date: November 26, 2004
No. 1
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
C-1-1-3
This certifies that CMI Investors 2, LP is the registered owner of a
Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class R Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class R
Certificates the aggregate Percentage Interest of which is in excess of a 66%
Percentage Interest of the Class R Certificates, or by check mailed by first
class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Certificate
Registrar may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose as provided in the
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class R Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
C-1-1-4
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer and the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) that the Depositor and the Certificate Registrar shall require an Opinion
of Counsel satisfactory to them that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositor, the Trustee or the Certificate Registrar, in their respective
capacities as such. None of the Depositor, the Certificate Registrar nor the
Trustee is obligated to register or qualify the Class of Certificates specified
on the face hereof under the 1933 Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositor, the Certificate Registrar and any Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
C-1-1-5
No transfer of this Certificate or any interest herein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing this Certificate or interest herein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed for all purposes to have consented to the provisions of Section 5.02 of
the Agreement and to any amendment of the Agreement deemed necessary by counsel
of the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause the Trust
to cease to qualify as eight separate REMICs or cause the imposition of a tax
upon the Trust.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-1-1-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October , 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT -Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s)
unto___________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-1-1-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of ___________________________, account number________________,
or, if mailed by check, to ___________________________________________________.
Applicable statements should be mailed to
_______________________________________________________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
C-1-1-9
EXHIBIT C-1-2
FORM OF CLASS R-X CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN SIX SEPARATE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE").
THIS CLASS R-X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES,
THE CLASS B-2 CERTIFICATES, THE CLASS B-3 CERTIFICATES AND THE CLASS
B-4 CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS R-X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CLASS R-X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER
DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE
SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED
EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R-X
CERTIFICATE MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1)
AN AFFIDAVIT TO THE CERTIFICATE REGISTRAR THAT SUCH TRANSFEREE IS NOT
(A) THE UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY
FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
THAN A COOPERATIVE DESCRIBED IN
C-1-2-1
SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY
CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX
IMPOSED BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN
SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE
FOREGOING CLAUSES (A), (B) OR (C) BEING HEREINAFTER REFERRED TO AS A
"DISQUALIFIED ORGANIZATION"), OR (D) AN AGENT OF A DISQUALIFIED
ORGANIZATION AND (2) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE
ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF
THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE
CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF
THIS CLASS R-X CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT
OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO
BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE
DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING,
BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE.
EACH HOLDER OF A CLASS R-X CERTIFICATE BY ACCEPTANCE OF THIS
CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF
THIS PARAGRAPH AND THE PROVISIONS OF SECTION 5.02(D) OF THE POOLING
AND SERVICING AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A
DISQUALIFIED ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL
OWNERSHIP OF THIS CLASS R-X CERTIFICATE.
C-1-2-2
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS R-X
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class R-X Servicer: ▇▇▇▇▇▇ Loan Servicing LP
Date of Pooling and Servicing Agreement and Trustee: U.S. Bank National Association
Cut-off Date: October 1, 2004
Closing Date: October 29, 2004
First Distribution Date: November 26, 2004
No. 1
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
C-1-2-3
This certifies that ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ is the registered owner of a
Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R-X Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Citigroup Mortgage Loan Trust Inc. (hereinafter called the
"Depositor," which term includes any successor entity under the Agreement), the
Servicer, the Seller and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date, in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class R-X Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class R-X
Certificates the aggregate Percentage Interest of which is in excess of a 66%
Percentage Interest of the Class R-X Certificates, or by check mailed by first
class mail to the address of the Person entitled thereto, as such name and
address shall appear on the Certificate Register, provided that the Certificate
Registrar may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose as provided in the
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class R-X Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
C-1-2-4
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer and the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) that the Depositor and the Certificate Registrar shall require an Opinion
of Counsel satisfactory to them that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositor, the Trustee or the Certificate Registrar, in their respective
capacities as such. None of the Depositor, the Certificate Registrar nor the
Trustee is obligated to register or qualify the Class of Certificates specified
on the face hereof under the 1933 Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositor, the Certificate Registrar and any Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
C-1-2-5
No transfer of this Certificate or any interest herein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing this Certificate or interest herein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan unless the
opinion letter in Section 5.02 of the Pooling and Servicing Agreement is
provided.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed for all purposes to have consented to the provisions of Section 5.02 of
the Agreement and to any amendment of the Agreement deemed necessary by counsel
of the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause the Trust
to cease to qualify as eight separate REMICs or cause the imposition of a tax
upon the Trust.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-1-2-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:____________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October , 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _____________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-1-2-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of _______________________, account number____________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to _____________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
C-1-2-9
EXHIBIT C-2
FORM OF CLASS M-1 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
C-2-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS M-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class M-1 Original Class Certificate Principal Balance of
the Class M-1 Certificates as of the Closing Date:
Pass-Through Rate: Variable $ 27,618,000.00
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance:
Cut-off Date: October 1, 2004 $ 27,618,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LP 1 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
C-2-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-1 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class M-1 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class M-1
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class M-1 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class M-1 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class M-1 Certificates during each Interest
Accrual Period at the Class M-1 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-1 Certificates.
C-2-3
The Class M-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates as described in the Pooling and Servicing Agreement referred to
herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
C-2-4
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-2-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of __________________________, account number ________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to _____________________________________
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
C-2-8
EXHIBIT C-3
FORM OF CLASS M-2 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AND THE CLASS M-1 CERTIFICATES AS DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
C-3-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS M-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class M-2 Original Class Certificate Principal Balance of
the Class M-2 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 22,816,000.00
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance:
Cut-off Date: October 1, 2004 $ 22,816,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LQ 9 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
C-3-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-2 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class M-2 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class M-2
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class M-2 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class M-2 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class M-2 Certificates during each Interest
Accrual Period at the Class M-2 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-2 Certificates.
C-3-3
The Class M-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates and the Class M-1 Certificates as described in the Pooling and
Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the
C-3-4
Depositor, the Servicer, the Trustee, the Certificate Registrar nor any such
agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-3-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-3-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________
_______________________________________________________________________________
for the account of __________________________, account number_________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to
_______________________________________________________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
C-3-8
EXHIBIT C-4
FORM OF CLASS M-3 CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
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.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES, THE CLASS M-1 CERTIFICATES AND THE CLASS M-2
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS
BENEFICIAL OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE
MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER PROPERTY.
C-4-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS M-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class M-3 Original Class Certificate Principal Balance of
the Class M-3 Certificates as of the Closing
Pass-Through Rate: Variable Date: $ 6,244,000.00
Date of Pooling and Servicing Agreement and Initial Certificate Principal Balance:
Cut-off Date: October 1, 2004 $ 6,244,000.00
First Distribution Date: November 26, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
No. 1 Trustee: U.S. Bank National Association
CUSIP: 17307G LR 7 Closing Date: October 29, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY,
THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY
BE LESS THAN THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
C-4-2
This certifies that Cede & Co. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Citigroup
Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Servicer, the Seller and
the Trustee, a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-3 Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class M-3 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class M-3
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of $5,000,000, or by check mailed by first class mail to the address of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Class M-3 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the lesser of (i) the sum of one month LIBOR plus the
Class M-3 Certificate Margin and (ii) the related Rate Cap for such Distribution
Date. Interest will accrue on the Class M-3 Certificates during each Interest
Accrual Period at the Class M-3 Pass-Through Rate.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-3 Certificates.
C-4-3
The Class M-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This certificate is subordinated in right of payment to the Class A
Certificates, the Class M-1 Certificates and the Class M-2 Certificates as
described in the Pooling and Servicing Agreement referred to herein.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the
C-4-4
Depositor, the Servicer, the Trustee, the Certificate Registrar nor any such
agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of
the Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been
executed by the Certificate Registrar, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.
C-4-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-4-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of _______________________________, account number____________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to______________________________________
_______________________________________________________________________________
This information is provided by __________________,the assignee named above, or
________________________________________, as its agent.
C-4-8
EXHIBIT C-5
FORM OF CLASS X CERTIFICATES
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
DIRECT OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A
"REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND IN CERTAIN OTHER PROPERTY.
THIS CLASS X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES,
THE CLASS B-2 CERTIFICATES, THE CLASS B-3 CERTIFICATES AND THE CLASS
B-4 CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CLASS X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER
DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE
SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED
EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
C-5-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS X
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class X Servicer: ▇▇▇▇▇▇ Loan Servicing LP
Date of Pooling and Servicing Agreement and Cut-off Date: Trustee: U.S. Bank National Association
October 1, 2004
Closing Date: October 29, 2004
First Distribution Date: November 26, 2004
No. 1
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
ASSET BACKED FUNDING CORPORATION, THE SERVICER, THE TRUSTEE OR ANY OF
THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
C-5-2
This certifies that NIM I LLC is the registered owner of a Percentage
Interest set forth above in that certain beneficial ownership interest evidenced
by all the Class X Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Citigroup Mortgage Loan Trust Inc. (hereinafter called the "Depositor," which
term includes any successor entity under the Agreement), the Servicer, the
Seller and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class X Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class X
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of a 66% Percentage Interest of the Class X Certificates, or by check
mailed by first class mail to the address of the Person entitled thereto, as
such name and address shall appear on the Certificate Register, provided that
the Certificate Registrar may deduct a reasonable wire transfer fee from any
payment made by wire transfer. Notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Trustee for that purpose as
provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class X Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
C-5-3
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) that the Depositor and the Certificate Registrar shall require an Opinion
of Counsel satisfactory to them that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositor, the Trustee or the Certificate Registrar, in their respective
capacities as such. None of the Depositor, the Certificate Registrar nor the
Trustee is obligated to register or qualify the Class of Certificates specified
on the face hereof under the 1933 Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositor, the Certificate Registrar and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
C-5-4
No transfer of this Certificate or any interest herein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing this Certificate or interest herein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan unless the
opinion letter in section 5.02 of the Pooling and Servicing Agreement is
provided.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee and the Certificate Registrar
and any agent of the Depositor, the Servicer, the Trustee or the Certificate
Registrar may treat the Person in whose name this Certificate is registered as
the owner hereof for all purposes, and none of the Depositor, the Servicer, the
Trustee, the Certificate Registrar nor any such agent shall be affected by
notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-5-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October , 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust)(Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-5-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
for the account of ______________________, account number_____________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to
_______________________________________________________________________________
This information is provided by___________________,the assignee named above, or
________________________________________, as its agent.
C-5-8
EXHIBIT C-6
FORM OF CLASS N CERTIFICATE
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
DIRECT OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A
"REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE "CODE") AND IN CERTAIN OTHER PROPERTY.
THIS CLASS N CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES
AND THE CLASS B-4 CERTIFICATES OF THIS SERIES TO THE EXTENT DESCRIBED
HEREIN AND IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CLASS N CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
THIS CLASS N CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER
DISPOSITION OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE
SUCH REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 5.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR THE CODE WILL BE REGISTERED
EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
C-6-1
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2004-CB7, CLASS N
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of fixed-rate and adjustable-rate one- to
four-family first and second lien mortgage loans formed and sold by
CITIGROUP MORTGAGE LOAN TRUST INC.
Series 2004-CB7, Class N Original Class N Notional Amount as of the
Closing Date: $13,449,265.61
Pass-Through Rate: 10.00 % per annum
Initial Notional Amount: $13,449,265.61
Date of Pooling and Servicing Agreement and
Cut-off Date: October 1, 2004 Servicer: ▇▇▇▇▇▇ Loan Servicing LP
First Distribution Date: November 26, 2004 Trustee: U.S. Bank National Association
No. 1 Closing Date: October 29, 2004
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
CITIGROUP MORTGAGE LOAN TRUST INC., THE SERVICER, THE TRUSTEE OR ANY
OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY
OR INSTRUMENTALITY OF THE UNITED STATES.
C-6-2
This certifies that Citigroup Global Markets Inc. is the registered
owner of a Percentage Interest (obtained by dividing the Initial Notional Amount
of this Certificate by the Original Class N Notional Amount) in that certain
beneficial ownership interest evidenced by all the Class N Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Citigroup Mortgage Loan Trust Inc.
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), the Servicer, the Seller and the Trustee, a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class N Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Certificate Registrar
in writing at least five Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Class N
Certificates the aggregate Initial Certificate Principal Balance of which is in
excess of a 66% Percentage Interest of the Class N Certificates, or by check
mailed by first class mail to the address of the Person entitled thereto, as
such name and address shall appear on the Certificate Register, provided that
the Certificate Registrar may deduct a reasonable wire transfer fee from any
payment made by wire transfer. Notwithstanding the above, the final distribution
on this Certificate will be made after due notice by the Trustee of the pendency
of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Trustee for that purpose as
provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as C-BASS Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class N Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
C-6-3
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee and the rights of the Certificateholders
under the Agreement at any time by the Depositor, the Servicer, the Seller and
the Trustee with the consent of the Holders of Certificates entitled to the
Voting Rights identified in the agreement. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification, the Certificate Registrar shall require, in order to assure
compliance with such laws, either (i) that the Certificateholder desiring to
effect the transfer and such Certificateholder's prospective transferee each
execute a representation letter in the form described by the Agreement
certifying to the Certificate Registrar the facts surrounding the transfer, or
(ii) that the Depositor and the Certificate Registrar shall require an Opinion
of Counsel satisfactory to them that such transfer may be made without such
registration or qualification, which Opinion of Counsel shall not be an expense
of the Depositor, the Trustee or the Certificate Registrar, in their respective
capacities as such. None of the Depositor, the Certificate Registrar nor the
Trustee is obligated to register or qualify the Class of Certificates specified
on the face hereof under the 1933 Act or any other securities law or to take any
action not otherwise required under the Agreement to permit the transfer of such
Certificates without registration or qualification. Any such Certificateholder
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Depositor, the Certificate Registrar and the Servicer against any
liability that may result if the transfer is not so exempt or is not made in
accordance with such federal and state laws.
C-6-4
No transfer of this Certificate or any interest herein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, ▇▇▇▇▇ plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing this Certificate or interest herein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan unless the
opinion letter in section 5.02 of the Pooling and Servicing Agreement is
provided.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer and the Trustee and the Certificate
Registrar and any agent of the Depositor, the Servicer, the Trustee or the
Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Servicer, the Trustee, the Certificate Registrar nor any such agent shall be
affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Principal Balance of the Mortgage Loans.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-6-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: October ___, 2004
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Certificate Registrar
By:________________________________
Authorized Signatory
Date of authentication: October ___, 2004
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
(Cust) (Minor)
TEN ENT -as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN -as joint tenants with right ________________
of survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above
list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto_______________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
_______________________________________________________________________________
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
C-6-7
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
_______________________________________________________________________________
for the account of ___________________________, account number________________,
or, if mailed by check, to____________________________________________________.
Applicable statements should be mailed to
_______________________________________________________________________________
This information is provided by____________________,the assignee named above, or
________________________________________, as its agent.
C-6-8
EXHIBIT D
MORTGAGE LOAN SCHEDULE
(Available Upon Request)
D-1
EXHIBIT E
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Pooling and Servicing Agreement dated as of
October 1, 2004 amongCitigroup Mortgage Loan Trust
Inc., as depositor, Credit-Based Asset Servicing
and Securitization LLC, as seller, ▇▇▇▇▇▇ Loan
Servicing LP, as servicer and U.S. Bank National
Association, as trustee
All capitalized terms used herein shall have the means ascribed to
them in the Pooling and Servicing Agreement (the "Agreement") referenced above.
In connection with the administration of the Mortgage Loans held by
you as Trustee pursuant to the Agreement, we request the release, and hereby
acknowledge receipt, of the Trustee's Mortgage File for the Mortgage Loan
described below, for the reason indicated.
Mortgage Loan Number:
Mortgagor Name, Address & Zip Code:
Reason for Requesting Documents (check one):
_____ 1. Mortgage Paid in Full
_____ 2. Foreclosure
_____ 3. Substitution
_____ 4. Other Liquidation (Repurchases, etc.)
_____ 5. Nonliquidation Reason:
E-1
By:________________________
(authorized signer)
Issuer:
Address:
Date:
Custodian
The Bank of New York
Please acknowledge the execution of the above request by your
signature and date below:
Signature Date
Documents returned to Custodian:
Custodian Date
E-2
EXHIBIT F-1
FORM OF TRUSTEE'S OR CUSTODIAN'S INITIAL CERTIFICATION
AVAILABLE UPON REQUEST
F-1-1
EXHIBIT F-2
FORM OF TRUSTEE'S FINAL CERTIFICATION
AVAILABLE UPON REQUEST
F-2-1
EXHIBIT F-3
FORM OF RECEIPT OF MORTGAGE NOTE
[BANK OF NEW YORK LETTERHEAD]
ACKNOWLEDGMENT OF RECEIPT
October 29, 2004
U.S. Bank National Association,
as Trustee for C-BASS
Mortgage Loan Asset-Backed
Certificates, Series 2004-CB7
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Custodial Agreement dated as of October 1, 2004 among U.S.
Bank National Association, as Trustee, ▇▇▇▇▇▇ Loan Servicing
LP, as Servicer, and The Bank of New York, as Custodian
Ladies and Gentlemen:
In accordance with the provisions of Section 4 of the above-referenced
Custodial Agreement, the undersigned, as the Custodian, hereby certifies as to
each Mortgage Loan in the Mortgage Schedule that (i) it has received the
original Mortgage Note with respect to each Mortgage Loan identified in the
Mortgage Loan Schedule attached hereto as Exhibit A and (ii) such Mortgage Note
has been reviewed by it and appears regular on its face and relates to such
Mortgage Loan. The Custodian makes no representations as to (i) the validity,
legality, enforceability, sufficiency, due authorization or genuineness of any
of the documents contained in each Custodial File or of any of the Mortgage
Loans or (ii) the collectability, insurability, effectiveness or suitability of
any such Mortgage Loan.
The Custodian hereby confirms that it is holding each such Mortgage
Note as agent and bailee of, and custodian for the exclusive use and benefit,
and subject to the sole direction of the Trustee pursuant to the terms and
conditions of the Custodial Agreement.
This Acknowledgment of Receipt is not divisible or negotiable.
The Custodian will accept and act on instructions with respect to the
Mortgage Loans subject hereto upon surrender of this Trust Receipt and Initial
Certification at the office of the Subcustodian at Bank of New York Western
Trust Company, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
Capitalized terms used herein shall have the meaning ascribed tot hem
in the Custodial Agreement.
▇-▇-▇
▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇,
as Custodian
By: _________________________
F-3-2
EXHIBIT G
FORM OF MORTGAGE LOAN PURCHASE AGREEMENT
G-1
================================================================================
CITIGROUP MORTGAGE LOAN TRUST INC.
as Purchaser
and
CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC
as Seller
MORTGAGE LOAN PURCHASE AGREEMENT
Fixed Rate and Adjustable Rate Mortgage Loans
Citigroup Mortgage Loan Trust, Series 2004-CB7
C-BASS Mortgage Loan Asset-Backed Certificates
Dated as of October 28, 2004
================================================================================
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS
Section 1.01 Definitions......................................................................................1
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01 Sale of Mortgage Loans...........................................................................2
Section 2.02 Obligations of Seller Upon Sale..................................................................2
Section 2.03 Payment of Purchase Price for the Mortgage Loans.................................................4
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01 Seller Representations and Warranties Relating to the Mortgage Loans.............................5
Section 3.02 Seller Representations and Warranties...........................................................15
ARTICLE IV
SELLER'S COVENANTS
Section 4.01 Covenants of the Seller.........................................................................18
ARTICLE V
OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS
ARTICLE VI
TERMINATION
Section 6.01 Termination.....................................................................................19
i
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 Amendment.......................................................................................19
Section 7.02 Governing Law...................................................................................19
Section 7.03 Notices.........................................................................................19
Section 7.04 Severability of Provisions......................................................................19
Section 7.05 Counterparts....................................................................................20
Section 7.06 Further Agreements..............................................................................20
Section 7.07 Intention of the Parties........................................................................20
Section 7.08 Successors and Assigns; Assignment of this Agreement............................................20
Section 7.09 Survival........................................................................................21
Schedule Mortgage Loan Schedule
ii
MORTGAGE LOAN PURCHASE AGREEMENT, dated as of October 28, 2004, (the
"AGREEMENT"), between CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC
("C-BASS" or the "SELLER") and CITIGROUP MORTGAGE LOAN TRUST INC. (the
"PURCHASER").
W I T N E S S E T H:
WHEREAS, the Seller is the owner of either the notes or other evidence
of indebtedness (the "MORTGAGE NOTES") or other evidence of ownership so
indicated on Schedule I hereto, and the other documents or instruments
constituting the Mortgage File (collectively, the "MORTGAGE LOANS"); and
WHEREAS, the Seller, as of the date hereof, owns the mortgages (the
"MORTGAGES") on the properties (the "MORTGAGED PROPERTIES") securing such
Mortgage Loans, including rights (a) to any property acquired by foreclosure or
deed in lieu of foreclosure or otherwise and (b) to the proceeds of any
insurance policies covering the Mortgage Loans or the Mortgaged Properties or
the obligors on the Mortgage Loans; and
WHEREAS, the parties hereto desire that the Seller sell the Mortgage
Loans to the Purchaser and the Purchaser purchase the Mortgage Loans from the
Seller pursuant to the terms of this Agreement; and
WHEREAS, pursuant to the terms of a Pooling and Servicing Agreement,
dated as of October 1, 2004 (the "POOLING AND SERVICING AGREEMENT"), among the
Seller as seller, the Purchaser, as depositor, ▇▇▇▇▇▇ Loan Servicing LP
("▇▇▇▇▇▇"), as servicer, and U.S. Bank National Association, as trustee (the
"Trustee"), the Purchaser will convey the Mortgage Loans to Citigroup Mortgage
Loan Trust, Series 2004-CB7.
NOW, THEREFORE, in consideration of the mutual covenants
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 DEFINITIONS. All capitalized terms used but not defined
herein and below shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
"CUSTODIAN": A custodian acceptable to the Trustee, which may be the
Trustee and which shall not be the Seller or any affiliate of the Seller. The
initial Custodian shall be The Bank of New York.
"INSURANCE AGREEMENT": With respect to any FHA Mortgage Loan, the
insurance contract issued by the FHA.
1
ARTICLE II
SALE OF MORTGAGE LOANS; PAYMENT OF PURCHASE PRICE
Section 2.01 SALE OF MORTGAGE LOANS.
(a) The Seller does hereby agree to and does hereby sell, assign, set
over, and otherwise convey to the Purchaser, without recourse, on the Closing
Date, all its right, title and interest, in and to (i) each Mortgage Loan and
the related Cut-off Date Principal Balance thereof, including any Related
Documents, (ii) all payments on or collections in respect of the Mortgage Loans
due after the Cut-off Date; (iii) property which secured such Mortgage Loan and
which has been acquired by foreclosure or deed in lieu of foreclosure; (iv) its
interest in any insurance policies in respect of the Mortgage Loans; and (v) all
proceeds of any of the foregoing.
(b) The Seller, concurrently with the execution and delivery of this
Agreement does hereby sell, and in connection therewith hereby assigns to the
Purchaser, effective as of the Closing Date, without recourse, all proceeds of
the foregoing.
Section 2.02 OBLIGATIONS OF SELLER UPON SALE.
(a) In connection with any transfer pursuant to Section 2.01 hereof,
the Seller further agrees, at its own expense, on or prior to the Closing Date,
(x) to indicate in its books and records that the Mortgage Loans have been sold
to the Purchaser pursuant to this Agreement and (y) to deliver to the Purchaser
and the Trustee a computer file containing a true and complete list of all the
Mortgage Loans specifying, among other things, for each Mortgage Loan, as of the
Cut-off Date, its account number and Cut-off Date Principal Balance. Such file
(the "MORTGAGE LOAN SCHEDULE") which is included as Exhibit D to the Pooling and
Servicing Agreement, shall also be marked as Schedule I to this Agreement and is
hereby incorporated into and made a part of this Agreement.
In connection with such transfer and assignment, the Seller, on behalf
of the Purchaser, does hereby deliver or cause to be delivered to, and deposit
with the Trustee, or its designated agent (the "Custodian"), the following
documents or instruments with respect to each Mortgage Loan (a "Mortgage File")
so transferred and assigned:
(i) the original Mortgage Note, endorsed either (A) in blank
or (B) in the following form: "Pay to the order of U.S. Bank National
Association, as Trustee, C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB7, without recourse," or with respect to
any lost Mortgage Note, an original lost note affidavit, together with
a copy of the related Mortgage Note;
(ii) the original Mortgage with evidence of recording
thereon, and the original recorded power of attorney, if the Mortgage
was executed pursuant to a power of attorney, with evidence of
recording thereon or, if such Mortgage or power of attorney has been
submitted for recording but has not been returned from the applicable
public
2
recording office, has been lost or is not otherwise available, a copy
of such Mortgage or power of attorney, as the case may be, certified
to be a true and complete copy of the original submitted for
recording;
(iii) an original Assignment of Mortgage, in form and
substance acceptable for recording. The Mortgage shall be assigned
either (A) in blank or (B) to "U.S. Bank National Association, as
Trustee, C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7, without recourse";
(iv) an original or a certified copy of any intervening
assignment of Mortgage showing a complete chain of assignments;
(v) the original or a certified copy of lender's title
insurance policy;
(vi) the original or copies of each assumption,
modification, written assurance or substitution agreement, if any; and
(vii) for each FHA Loan, the original Mortgage Insurance
Certificate.
If any of the documents referred to in Section 2.02(ii), (iii) or (iv)
above has as of the Closing Date been submitted for recording but either (x) has
not been returned from the applicable public recording office or (y) has been
lost or such public recording office has retained the original of such document,
the obligations of the Seller to deliver such documents shall be deemed to be
satisfied upon (1) delivery to the Trustee or the Custodian no later than the
Closing Date, of a copy of each such document certified by the Seller in the
case of (x) above or the applicable public recording office in the case of (y)
above to be a true and complete copy of the original that was submitted for
recording and (2) if such copy is certified by the Seller, delivery to the
Trustee or the Custodian, promptly upon receipt thereof of either the original
or a copy of such document certified by the applicable public recording office
to be a true and complete copy of the original. The Seller shall deliver or
cause to be delivered to the Trustee or the Custodian promptly upon receipt
thereof any other documents constituting a part of a Mortgage File received with
respect to any Mortgage Loan, including, but not limited to, any original
documents evidencing an assumption or modification of any Mortgage Loan.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File, the Seller
shall have 120 days to cure such defect or 150 days following the Closing Date,
in the case of missing Mortgages or Assignments or deliver such missing document
to the Trustee or the Custodian. If the Seller does not cure such defect or
deliver such missing document within such time period, the Seller shall either
repurchase or substitute for such Mortgage Loan in accordance with Section 3.01
hereof.
The Purchaser hereby acknowledges its acceptance of all right, title
and interest to the Mortgage Loans and other property, now existing and
hereafter created, conveyed to it pursuant to Section 2.01.
3
The parties hereto intend that the transaction set forth herein be a
sale by the Seller to the Purchaser of all the Seller's right, title and
interest in and to the Mortgage Loans and other property described above. In the
event the transaction set forth herein is deemed not to be a sale, the Seller
hereby grants to the Purchaser a security interest in all of the Seller's right,
title and interest in, to and under the Mortgage Loans and other property
described above, whether now existing or hereafter created, to secure all of the
Seller's obligations hereunder; and this Agreement shall constitute a security
agreement under applicable law. The Seller and the Purchaser shall, to the
extent consistent with this Agreement, take such actions as may be necessary to
ensure that, if this Agreement were deemed to create a security interest in the
Mortgage Loans, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of this Agreement.
(b) The Seller shall cause the Assignments of Mortgage which were
delivered in blank to be completed and shall cause all Assignments referred to
in Section 2.02(iii) hereof and, to the extent necessary, in Section 2.02(iv)
hereof to be recorded. The Seller shall be required to deliver such assignments
for recording within 30 days of the Closing Date. The Seller shall furnish the
Trustee, or its designated agent, with a copy of each assignment of Mortgage
submitted for recording. In the event that any such Assignment is lost or
returned unrecorded because of a defect therein, the Seller shall promptly have
a substitute Assignment prepared or have such defect cured, as the case may be,
and thereafter cause each such Assignment to be duly recorded.
In the event that any Mortgage Note is endorsed in blank as of the
Closing Date, promptly following the Closing Date the Seller shall cause to be
completed such endorsements in the following form: "Pay to the order of U.S.
Bank National Association, as Trustee--C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB7, without recourse."
Section 2.03 PAYMENT OF PURCHASE PRICE FOR THE MORTGAGE LOANS. In
consideration of the sale of the Mortgage Loans from the Seller to the Purchaser
on the Closing Date, the Purchaser agrees to pay to the Seller on the Closing
Date by transfer of immediately available funds, as directed by the Seller, an
amount equal to $453,452,154.49 in respect of the Mortgage Loans (the "PURCHASE
Price"), net of an expense reimbursement amount of $44,934.30 (the "EXPENSE
REIMBURSEMENT AMOUNT"), and to transfer to the Seller or its designee on the
Closing Date, (i) the Class B-2, Class B-3, Class B-4 and Residual Certificates
(collectively, the "Retained Certificates"). The Expense Reimbursement Amount
shall reimburse the Purchaser for the Purchaser's Securities and Exchange
Commission registration statement fees and the Purchaser's registration
statement administration fees allocable to the Trust. The Seller shall pay, and
be billed directly for, all expenses incurred by the Purchaser in connection
with the issuance of the Certificates, including, without limitation, printing
fees incurred in connection with the prospectus relating to the Certificates,
blue sky registration fees and expenses, fees and reasonable expenses of
Purchaser's counsel, fees of the rating agencies requested to rate the
Certificates, accountant's fees and expenses and the fees and expenses of the
Trustee and other out-of-pocket costs, if any. If the Purchaser shall determine
that the Expense Reimbursement
4
Amount is not sufficient to reimburse the Purchaser for all expenses incurred by
it that are subject to reimbursement by the Seller hereunder as described above,
the Seller shall promptly reimburse the Purchaser for such additional amounts
upon written notice by the Purchaser to the Seller.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; REMEDIES FOR BREACH
Section 3.01 SELLER REPRESENTATIONS AND WARRANTIES RELATING TO THE
MORTGAGE LOANS. The Seller hereby represents and warrants to the Purchaser, with
respect to the Mortgage Loans, that as of the Closing Date or as of such date
specifically provided herein:
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct as of the Cut-off Date.
(b) There are no delinquent taxes, ground rents, water charges, sewer
rents, assessments, including assessments payable in future installments, or
other outstanding charges affecting the related Mortgaged Property.
(c) The terms of the Mortgage Note and the Mortgage have not been
impaired, waived, altered or modified in any respect, except by written
instruments, recorded in the applicable public recording office if necessary to
maintain the lien priority of the Mortgage and the interests of the
Certificateholders, and which have been delivered to the Trustee; the substance
of any such waiver, alteration or modification has been approved by the title
insurer, to the extent required by the related policy, and is reflected on the
Mortgage Loan Schedule. No instrument of waiver, alteration or modification has
been executed, and no Mortgagor has been released, in whole or in part, except,
in connection with an assumption agreement approved by the title insurer, to the
extent required by the policy and, in the case of an FHA Loan, to the extent
required by the Insurance Agreement, and which assumption agreement has been
delivered to the Trustee and the terms of which are reflected in the Mortgage
Loan Schedule.
(d) The Mortgage Note and the Mortgage are not subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
nor will the operation of any of the terms of the Mortgage Note and the
Mortgage, or the exercise of any right thereunder, render the Mortgage
unenforceable, in whole or in part, or subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury and no such
right of rescission, set-off, counterclaim or defense has been asserted with
respect thereto.
(e) All buildings upon the Mortgaged Property are insured by a
generally acceptable insurer against loss by fire, hazards of extended coverage
and such other hazards as are customary in the area where the Mortgaged Property
is located, pursuant to insurance policies conforming to the requirements of the
Pooling and Servicing Agreement. All such insurance policies contain a standard
mortgagee clause naming the Seller, its successors and
5
assigns as mortgagee and all premiums thereon have been paid. If upon
origination of the Mortgage Loan, the Mortgaged Property was in an area
identified on a Flood Hazard Map or Flood Insurance Rate Map issued by the
Federal Emergency Management Agency as having special flood hazards (and such
flood insurance has been made available) a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
is in effect which policy conforms to the requirements of the Federal National
Mortgage Association ("FNMA") and the Federal Home Loan Mortgage Corporation
("FHLMC"). The Mortgage obligates the Mortgagor thereunder to maintain all such
insurance at the Mortgagor's cost and expense, and on the Mortgagor's failure to
do so, authorizes the holder of the Mortgage to maintain such insurance at the
Mortgagor's cost and expense and to seek reimbursement therefor from the
Mortgagor. All acts required to be performed to preserve the rights and remedies
of the Trustee in any such insurance policies have been performed, including,
without limitation, any necessary notifications of insurers and assignments of
policies or interests therein.
(f) As of the date of origination of the Mortgage Loan, any and all
requirements of any federal, state or local law, including, without limitation,
usury, truth in lending, real estate settlement procedures, consumer credit
protection, equal credit opportunity or disclosure laws applicable to the
origination of the Mortgage Loans have been complied with. Any and all
requirements of any federal, state or local law, including, without limitation,
usury, truth in lending, real estate settlement procedures, consumer credit
protection, equal credit opportunity or disclosure laws applicable to the
servicing of the Mortgage Loans have been complied with.
(g) The Mortgage has not been satisfied, canceled, subordinated (other
than with respect to second lien loans, the subordination to the first lien
loan) rescinded, in whole or in part, and the Mortgaged Property has not been
released from the lien of the Mortgage, in whole or in part, nor has any
instrument been executed that would effect any such satisfaction, cancellation,
subordination, rescission or release.
(h) The Mortgage is a valid, existing and enforceable first or second
lien on the Mortgaged Property, including all improvements on the Mortgaged
Property subject only to (1) the lien of current real property taxes and
assessments not yet due and payable, (2) covenants, conditions and restrictions,
rights of way, easements and other matters of the public record as of the date
of recording being acceptable to mortgage lending institutions generally and, in
the case of FHA Loans, to the FHA, and specifically referred to in the lender's
title insurance policy delivered to the originator of the Mortgage Loan, (3)
other matters to which like properties are commonly subject which do not
materially interfere with the benefits of the security intended to be provided
by the Mortgage or the use, enjoyment, value or marketability of the related
Mortgaged Property and which may not in any way prevent realization of the
benefits of the related Insurance Agreement, if applicable and (4) with respect
to any second lien mortgage loan, the lien of the related first mortgage loan.
Any security agreement, chattel mortgage or equivalent document related to and
delivered in connection with the Mortgage Loan establishes and creates a valid,
existing and enforceable first or second lien and first or second priority
6
security interest on the property described therein and the Seller has full
right to sell and assign the same to the Purchaser.
(i) The Mortgage Note and the related Mortgage are genuine and each is
the legal, valid and binding obligation of the maker thereof, enforceable in
accordance with its terms.
(j) The proceeds of the Mortgage Loan have been fully disbursed to or
for the account of the Mortgagor and there is no obligation for the mortgagee to
advance additional funds thereunder and any and all requirements as to
completion of any on-site or off-site improvement and as to disbursements of any
escrow funds therefor have been complied with. All costs, fees and expenses
incurred in making or closing the Mortgage Loan and the recording of the
Mortgage have been paid, and the Mortgagor is not entitled to any refund of any
amounts paid or due to the mortgagee pursuant to the Mortgage Note or Mortgage.
(k) Immediately prior to the transfer and assignment contemplated
herein, the Seller was the sole owner and holder of the Mortgage Loans and has
good and marketable title to each Mortgage Loan, free and clear of any and all
liens, pledges, charges, claims, participation interests, mortgages, security
interests or encumbrances or other interests of any nature and has full right
and authority to sell and assign the same.
(l) Each Mortgage Loan is covered by an ALTA mortgagee title insurance
policy acceptable to FNMA or FHLMC, issued by a title insurer acceptable to (1)
FNMA and FHLMC, in the case of a conventional Mortgage Loan and (2) the FHA, in
the case of an FHA Loan, and qualified to do business in the jurisdiction where
the Mortgaged Property is located, insuring (subject to the exceptions contained
in (h)(1) and (2) above) the Seller, its successors and assigns as to the first
or second priority lien of the Mortgage in the original principal amount of the
Mortgage Loan and against any loss by reason of the invalidity or
unenforceability of the lien resulting from the provisions of the Mortgage
providing for adjustment in the mortgage interest rate and/or monthly payment
including any negative amortization thereunder. Additionally, such mortgagee
title insurance policy affirmatively insures ingress and egress to and from the
Mortgaged Property, and against encroachments by or upon the Mortgaged Property
or any interest therein. The Seller is the sole insured of such mortgagee title
insurance policy, and such lender's title insurance policy is in full force and
effect and will be in full force and effect upon the consummation of the
transactions contemplated by this Agreement. No claims have been made under such
mortgagee title insurance policy, and no prior holder of the related Mortgage,
including the Seller, has done, by act or omission, anything which would impair
the coverage of such mortgagee title insurance policy.
(m) There are no mechanics' or similar liens or claims which have been
filed for work, labor or material (and no rights are outstanding that under law
could give rise to such lien) affecting the related Mortgaged Property which are
or may be liens prior to, or equal or coordinate with, the lien of the related
Mortgage.
7
(n) The collection practices used by the Servicer with respect to each
Mortgage Note and Mortgage have been in all respects legal, proper, prudent and
customary in the mortgage servicing industry.
(o) The Mortgage and related Mortgage Note contain customary and
enforceable provisions such as to render the rights and remedies of the holder
thereof adequate for the realization against the Mortgaged Property of the
benefits of the security provided thereby, including, (1) in the case of a
Mortgage designated as a deed of trust, by trustee's sale, and (2) otherwise by
judicial foreclosure. There is no homestead or other exemption available to the
Mortgagor which would interfere with the right to sell the Mortgaged Property at
a trustee's sale or the right to foreclose the Mortgage. The Mortgagor has not
notified the Seller and the Seller has no knowledge of any relief requested or
allowed to the Mortgagor under the Servicemembers Civil Relief Act of 1940, as
amended.
(p) The Mortgage Note is not and has not been secured by any
collateral except the lien of the corresponding Mortgage on the Mortgaged
Property and the security interest of any applicable security agreement or
chattel mortgage.
(q) In the event the Mortgage constitutes a deed of trust, a trustee,
duly qualified under applicable law to serve as such, has been properly
designated and currently so serves and is named in the Mortgage, and no fees or
expenses are or will become payable by the Purchaser to the trustee under the
deed of trust, except in connection with a trustee's sale after default by the
Mortgagor.
(r) No Mortgage Loan contains provisions pursuant to which monthly
payments are (1) paid or partially paid with funds deposited in any separate
account established by the Seller, the Mortgagor, or anyone on behalf of the
Mortgagor, (2) paid by any source other than the Mortgagor or (3) contains any
other similar provisions which may constitute a "buydown" provision. The
Mortgage Loan is not a graduated payment mortgage loan and the Mortgage Loan
does not have a shared appreciation or other contingent interest feature.
(s) The Mortgage Note, the Mortgage, the Assignment and any other
documents required to be delivered with respect to each Mortgage Loan pursuant
to Section 2.02 hereof have been delivered to the Purchaser or its designee, all
in compliance with the specific requirements of Section 2.02 hereof.
(t) If the residential dwelling on the Mortgaged Property is a
condominium unit or a unit in a planned unit development (other than a de
minimis planned unit development) such condominium or planned unit development
project meets FNMA's eligibility requirements.
(u) None of the Mortgage Loans are secured by a leasehold estate or
constitute other than real property under applicable state law.
8
(v) The rights with respect to each Mortgage Loan are assignable by
the Seller without the consent of any Person other than consents which will have
been obtained on or before the Closing Date.
(w) The Mortgage Loans are not being transferred by the Seller with
any intent to hinder, delay or defraud any creditors of the Seller.
(x) All parties which have had any interest in each Mortgage Loan,
whether as mortgagee, assignee, pledgee or otherwise, and including, without
limitation, the Seller, are (or during the period in which they held and
disposed such interest, were) in compliance with any and all applicable
licensing requirements of the laws of the state wherein the property securing
the Mortgage is located to the extent that any noncompliance thereunder would
affect the value or marketability of the Mortgage Loans.
(y) To the best of Seller's knowledge, the Mortgaged Property is free
from any and all toxic or hazardous substances and there exists no violation of
any local, state or federal environmental law, rule or regulation.
(z) The Mortgaged Property is free from material damage.
(aa) Each Mortgage Loan has been serviced by the Servicer in
accordance with the terms thereof and Applicable Regulations.
(bb) [Reserved]
(cc) [Reserved]
(dd) There is no proceeding pending for the total or partial
condemnation and no eminent domain proceedings pending affecting any Mortgaged
Property.
(ee) There was no fraud involved in the origination of any Mortgage
Loan by the applicable mortgagee or Mortgagor, and to the best of the Seller's
knowledge, there was no fraud by the appraiser or any other party involved in
the origination of any such Mortgage Loan.
(ff) Each mortgage file contains an appraisal of or a broker's price
opinion regarding the related Mortgaged Property indicating an appraised value
equal to the appraised value identified for such Mortgaged Property on the
Mortgage Loan Schedule. Each appraisal has been prepared on FNMA or FHLMC forms.
(gg) No improvements on any Mortgaged Property encroach on adjoining
properties (and in the case of a condominium unit, such improvements are within
the project with respect to that unit), and no improvements on adjoining
properties encroach upon such Mortgaged Property unless there exists in the
applicable Mortgage File a title policy with endorsements which insure against
losses sustained by the insured as a result of such encroachments.
9
(hh) Each Insurance Agreement is in full force and effect and will be
in full force and effect upon the consummation of the transactions contemplated
by this Agreement.
(ii) With respect to escrow deposits, if any, all such payments are in
the possession of, or under the control of, the Servicer and there exists no
deficiencies in connection therewith for which customary arrangements for
repayment thereof have not been made. No escrow deposits or escrow advances or
other charges or payments due the Servicer have been capitalized under any
Mortgage or the related Note.
(jj) No Mortgage Loan, other than a Bankruptcy Plan Mortgage Loan, is
subject to any pending bankruptcy or insolvency proceeding. To the Seller's best
knowledge, no material litigation or lawsuit relating to any Mortgage Loan is
pending.
(kk) The Seller used no selection procedures that identified the
Mortgage Loans as being less desirable or valuable than other comparable
mortgage loans acquired by the Seller.
(ll) The sale, transfer, assignment and conveyance of Mortgage Loans
by the Seller pursuant to this Agreement will not result in any tax, fee or
governmental charge (other than income taxes and related taxes) payable by the
Seller, the Depositor or the Trustee to any federal, state or local government
other than taxes which have or will be paid by the Seller as due ("TRANSFER
TAXES"). In the event that the Depositor or the Trustee receives actual notice
of any Transfer Taxes arising out of the transfer, assignment and conveyance of
the Mortgage Loans, other than any taxes to be paid by the creditor, on written
demand by the Depositor, or the Trustee, or upon the Seller's otherwise being
given notice thereof by the Depositor or the Trustee, the Seller shall pay, and
otherwise indemnify and hold the Depositor and the Trustee harmless, on an
after-tax basis, from and against any and all such Transfer Taxes (it being
understood that the Certificateholders, the Trustee and the Depositor shall have
no obligation to pay such Transfer Taxes).
(mm) With respect to each Mortgage Loan that is a "mortgage" as such
term is defined in 15 U.S.C. 1602(aa), no obligor has or will have a claim or
defense under such Mortgage Loan as a result of a violation of the Home
Ownership and Equity Protection Act of 1994.
(nn) With respect to the Mortgage Loans, the Mortgaged Properties
securing repayment of the related Mortgage Note, consists of a fee simple
interest in a single parcel or two contiguous parcels of real property (i)
improved by a (A) detached or semi-detached one-family dwelling, (B) detached or
semi-detached two-to four family dwelling, (C) one-family unit in a FNMA
eligible condominium project, (D) detached or semi-detached one-family dwelling
in a planned unit development, (E) multi-family dwelling or townhouse or (F)
mobile home or manufactured dwelling which constitutes real property or (ii)
unimproved by any residential dwelling.
10
(oo) Except for the Mortgage Loans identified on the Mortgage Loan
Schedule as delinquent, there is no default, breach, violation or event of
acceleration existing under the Mortgage or the Mortgage Note and no event
which, with the passage of time or with notice and the expiration of any grace
or cure period, would constitute a default, breach, violation or event of
acceleration, and the Seller has not waived any default, breach, violation or
event of acceleration except, in the case of an FHA Loan, by written
instruments, and the substance of which waiver has been approved by the FHA to
the extent required by the applicable Insurance Agreement.
(pp) The Seller has no actual knowledge that with respect to any
Mortgage Loan (1) the Servicer has sent a notice of default to the related
Mortgagor which the Servicer is currently seeking to enforce, or (2) any
foreclosure proceedings have been commenced or acceleration been declared which
is currently pending. The Seller is not transferring any Mortgage Loan to the
Purchaser with the intention or knowledge that the Purchaser or the Trust will
acquire the related Mortgaged Property.
(qq) With respect to any Mortgage Loan that is secured by a second
lien on the related Mortgaged Property, either (i) no consent for the Mortgage
Loan is required by the holder of any related senior lien or (ii) such consent
has been obtained and is contained in the Mortgage File.
(rr) In any case in which a Mortgage Loan is secured by a second lien
and a senior lien on the related Mortgaged Property provides for negative
amortization or deferred interest, the balance of such senior lien on the
related Mortgaged Property used to calculate the Combined Loan to Value Ratio
for the Mortgage Loan is based on the maximum amount of negative amortization
possible under such senior loan.
(ss) With respect to a Mortgage Loan which is a second lien, as of the
date hereof, the Seller has not received a notice of default of a senior lien on
the related Mortgaged Property which has not been cured.
(tt) No Mortgage Loan is delinquent (other than Mortgage Loans subject
to a bankruptcy plan or forbearance plan). The Seller has not waived any
default, breach, violation or event of acceleration, and the Seller has not
taken any action to waive any default, breach, violation or event of
acceleration, with respect to any Mortgage Loan.
(uu) Each Mortgage Loan is a "qualified Mortgage" within the meaning
of Section 860 G(a)(3) of the Code.
(vv) With respect to any Adjustable-Rate Mortgage Loan, all rate
adjustments have been performed in accordance with the terms of the related
Mortgage Note or subsequent modifications, if any.
(ww) At the time of their origination, all FHA Loans conformed to HUD
origination guidelines.
11
(xx) Each Mortgage Loan is directly secured by a Mortgage on a
residential property, and either (1) substantially all of the proceeds of the
Mortgage Loan were used to acquire, improve or protect the portion of the
residential property that consists of an interest in real property (within the
meaning of Treasury Regulations Sections 1.856-3(c) and 1.856-3(d)) and the
interest in real property was the only security for the Mortgage Loan as of the
Testing Date (as defined below), or (2) the fair market value of the interest in
real property which secures the Mortgage Loan was at least equal to 80% of the
principal amount of the Mortgage Loan (a) as of the Testing Date, or (b) as of
the Closing Date. For purposes of the previous sentence, (1) the fair market
value of the referenced interest in real property shall first be reduced by (a)
the amount of any lien on the interest in real property that is senior to the
Mortgage Loan, unless the Mortgage Loan includes both a first lien loan and a
second lien loan on the same Mortgaged Property, in which case the 80% test
shall be applied in the aggregate, and (b) a proportionate amount of any lien on
the interest in real property that is on a parity with the Mortgage Loan, and
(2) the "TESTING DATE" shall be the date on which the referenced Mortgage Loan
was originated unless (a) the Mortgage Loan was modified after the date of its
origination in a manner that would cause "significant modification" of the
Mortgage Loan within the meaning of Treasury Regulations Section 1.1001-3, and
(b) the "significant modification" did not occur at a time when the Mortgage
Loan was in default or when default with respect to the Mortgage Loan was
reasonably foreseeable.
(yy) With respect to each Mortgage Loan that is a mobile or
manufactured housing unit, such unit is a "single family residence" within the
meaning of Section 25(e)(1) of the Code, and has a minimum of 400 square feet of
living space, a minimum width of 102 inches and is of a kind customarily used at
a fixed location.
(zz) Any written agreement between the Mortgagor in respect of a
Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved some assessment of the Mortgagor's ability to repay the
Modified Mortgage Loan.
(aaa) No Mortgage Loan is covered by the Home Ownership and Equity
Protection Act of 1994 ("HOEPA") and no Mortgage Loan is in violation of any
state law or ordinance similar to HOEPA.
(bbb) No proceeds from any Mortgage Loan were used to finance
single-premium credit insurance policies.
(ccc) No Mortgage Loan originated on or after October 1, 2002 will
impose a Prepayment Charge for a term in excess of three years. Any Mortgage
Loan originated prior to such date will not impose a Prepayment Charge in excess
of five years.
(ddd) The Servicer has fully furnished and will continue to fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (e.g., favorable and unfavorable)
on its borrower credit files to Equifax,
12
Experian and Trans Union Credit Information Company (three of the credit
repositories), on a monthly basis.
(eee) There is no Mortgage Loan in the Trust Fund that was originated
on or after October 1, 2002 and before March 7, 2003, which is secured by
property located in the State of Georgia.
(fff) There is no Mortgage Loan in the Trust Fund that was originated
on or after March 7, 2003, which is a "high cost home loan" as defined under the
Georgia Fair Lending Act.
(ggg) (a) No Mortgage Loan is classified as a high cost mortgage loan
under HOEPA; and (b) no Mortgage Loan in the Trust Fund is a "high cost home,"
"covered" (excluding home loans defined as "covered home loans" pursuant to
clause (1) of the definition of that term in the New Jersey Home Ownership
Security Act of 2002), "high risk home" or "predatory" loan under any other
applicable state, federal or local law (or a similarly classified loan using
different terminology under a law imposing heightened regulatory scrutiny or
additional legal liability for residential mortgage loans having high interest
rates, points and/or fees).
(hhh) None of the Mortgage Loans are High Cost as defined by the
applicable predatory and abusive lending laws or any federal, state or local
law.
(iii) No Mortgage Loans are subject to the Georgia Fair Lending act
("GFLA") effective from October 1, 2002 to ▇▇▇▇▇ ▇, ▇▇▇▇.
(▇▇▇) The Prepayment Charges included in the transaction are
enforceable and were originated in compliance with all federal, state and local
laws.
(kkk) All Mortgage Loans were originated in compliance with all
applicable laws, including, but not limited to all applicable anti-predatory
lending laws.
(lll) Information provided to the rating agencies, including the loan
level detail, is true and correct according to the rating agency requirements.
(mmm) No Mortgage Loan is a High Cost Loan or a Covered Loan, as
applicable, as such terms are defined in Appendix E of the Standard & Poor's
Glossary For File Format For LEVELS(R) Version 5.6 Revised (attached hereto as
Exhibit 1), with the exception of any Mortgage Loan secured by property located
in the states of Kansas or West Virginia.
With respect to the representations and warranties set forth in this
Section 3.01 that are made to the best of the Seller's knowledge or as to which
the Seller has no knowledge, if it is discovered by the Depositor, the Seller,
the Servicer or the Trustee, as set forth in Section 2.04 of the Pooling and
Servicing Agreement, that the substance of such representation and warranty is
inaccurate and such inaccuracy materially and adversely affects the value of the
related Mortgage Loan or the interest therein of the Purchaser or the
Purchaser's assignee, transferee or designee for the benefit of the
Certificateholders then, notwithstanding the Seller's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.
Upon discovery by the Depositor, the Seller, the Servicer, the
Purchaser or any assignee, transferee or designee of the Purchaser of a breach
of any of the representations and warranties contained in this Article III or
Section 2.04 of the Pooling and Servicing Agreement that materially and
adversely affects the value of any Mortgage Loan or the interest therein of the
Purchaser or the Purchaser's assignee, transferee or designee for the benefit of
the Certificateholders, the party discovering the breach shall give prompt
written notice to the others and in no event later than two Business Days from
the date of such discovery. It is understood by the parties hereto that a breach
of the representations and warranties made in this Section 3.01(aaa), (bbb),
(ccc), (ddd), (eee), (fff) and (ggg) will be deemed to materially and adversely
affect the value of the related
13
Mortgage Loan or the interest therein of the Purchaser or the Purchaser's
assignee. Within 90 days of the earlier of its discovery or its receipt of
notice of any such breach of a representation or warranty, the Seller shall
promptly cure such breach in all material respects, or in the event such defect
or breach cannot be cured, the Seller shall repurchase the affected Mortgage
Loan or cause the removal of such Mortgage Loan from the Trust Fund and
substitute for it one or more Eligible Substitute Mortgage Loans, in either
case, in accordance with Section 2.03 of the Pooling and Servicing Agreement.
Upon discovery or receipt of written notice by the Seller of any
materially defective document in, or that a document is missing from, a Mortgage
File, the Seller shall have 120 days to cure such defect or 150 days following
the Closing Date, in the case of missing Mortgages or Assignments (or within 90
days of the earlier of the Seller's discovery or receipt of notification if such
defect would cause the Mortgage Loan not to be a "qualified mortgage" for REMIC
purposes), or in the event such defect cannot be cured, the Seller shall
repurchase the affected Mortgage Loan or cause the removal of such Mortgage Loan
from the Trust Fund and substitute for it one or more Eligible Substitute
Mortgage Loans, in either case, within such time periods and in accordance with
Section 2.03 of the Pooling and Servicing Agreement.
It is understood and agreed that the representations and warranties
set forth in this Section 3.01 shall survive delivery of the respective Mortgage
Files to the Trustee or its agent, on behalf of the Purchaser and shall inure to
the benefit of the Certificateholders notwithstanding any restrictive or
qualified endorsement or assignment.
It is understood and agreed that the obligations of the Seller set
forth in this Section 3.01 to cure, repurchase or substitute for a defective
Mortgage Loan constitute the sole remedies of the Purchaser, the
Certificateholders or the Trustee on their behalf respecting a missing or
defective document or a breach of the representations or warranties contained in
this Section 3.01.
14
Section 3.02 SELLER REPRESENTATIONS AND WARRANTIES. The Seller hereby
represents and warrants to the Purchaser that as of the Closing Date or as of
such date specifically provided herein:
(i) The Seller is duly organized, validly existing and in good
standing as a limited liability company under the laws of the State of Delaware
and has the power and authority to own its assets and to transact the business
in which it is currently engaged. The Seller is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the
business transacted by it or properties owned or leased by it requires such
qualification and in which the failure to so qualify would have a material
adverse effect on (a) its business, properties, assets or condition (financial
or other), (b) the performance of its obligations under this Agreement, (c) the
value or marketability of the Mortgage Loans, or (d) its ability to foreclose on
the related Mortgaged Properties.
(ii) The Seller has the power and authority to make, execute, deliver
and perform this Agreement and to consummate all of the transactions
contemplated hereunder and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the Seller's legal, valid and binding
obligations enforceable in accordance with its terms, except as enforcement of
such terms may be limited by (1) bankruptcy, insolvency, reorganization,
receivership, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by the availability of equitable remedies, (2) general
equity principals (regardless of whether such enforcement is considered in a
proceeding in equity or at law) or (3) public policy considerations underlying
the securities laws, to the extent that such policy considerations limit the
enforceability of the provisions of this Agreement which purport to provide
indemnification from securities laws liabilities.
(iii) The Seller holds all necessary licenses, certificates and
permits from all governmental authorities necessary for conducting its business
as it is presently conducted, except for such licenses, certificates and permits
the absence of which, individually or in the aggregate, would not have a
material adverse effect on the ability of the Seller to conduct its business as
it is presently conducted. It is not required to obtain the consent of any other
party or any consent, license, approval or authorization from, or registration
or declaration with, any governmental authority, bureau or agency in connection
with the execution, delivery, performance, validity or enforceability of this
Agreement, except for such consents, licenses, approvals or authorizations, or
registrations or declarations as shall have been obtained or filed, as the case
may be, prior to the Closing Date.
(iv) The execution, delivery and performance of this Agreement by the
Seller will not conflict with or result in a breach of, or constitute a default
under, any provision of any existing law or regulation or any order or decree of
any court applicable to the Seller or any of its properties or any provision of
its Limited Liability Company Agreement, or constitute a material breach of, or
result in the creation or imposition of any lien, charge or encumbrance upon any
of
15
its properties pursuant to any mortgage, indenture, contract or other agreement
to which it is a party or by which it may be bound.
(v) No certificate of an officer, written statement or report
delivered pursuant to the terms hereof by the Seller contains any untrue
statement of a material fact or omits to state any material fact necessary to
make the certificate, statement or report not misleading.
(vi) The transactions contemplated by this Agreement are in the
ordinary course of the Seller's business.
(vii) The Seller is not insolvent, nor will the Seller be made
insolvent by the transfer of the Mortgage Loans, nor is the Seller aware of any
pending insolvency.
(viii) The Seller is not in violation of, and the execution and
delivery of this Agreement by it and its performance and compliance with the
terms of this Agreement will not constitute a violation with respect to any
order or decree of any court, or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction, which violation would
materially and adversely affect the Seller's condition (financial or otherwise)
or operations or any of the Seller's properties, or materially and adversely
affect the performance of any of its duties hereunder.
(ix) There are no actions or proceedings against, or investigations
of, the Seller pending or, to its knowledge, threatened, before any court,
administrative agency or other tribunal (i) that, if determined adversely, would
prohibit the Seller from entering into this Agreement and the Pooling and
Servicing Agreement, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or (iii) that, if determined
adversely, would prohibit or materially and adversely affect the Seller's
performance of any of its respective obligations under, or the validity or
enforceability of, this Agreement and the Pooling and Servicing Agreement.
(x) The Seller is not transferring the Mortgage Loans to the Purchaser
hereunder with any intent to hinder, delay or defraud any of its creditors.
(xi) The Seller acquired title to the Mortgage Loans in good faith,
without notice of any adverse claims.
(xii) The transfer, assignment and conveyance of the Mortgage Notes
and the Mortgages by the Seller pursuant to this Agreement are not subject to
the bulk transfer laws or any similar statutory provisions in effect in any
applicable jurisdiction.
(xiii) The Seller understands that (a) the Retained Certificates have
not been and will not be registered or qualified under the Securities Act of
1933, as amended (the "SECURITIES ACT") or any state securities law, (b) the
Purchaser is not required to so register or qualify the Retained Certificates,
(c) the Retained Certificates may be resold only if registered and qualified
pursuant to the provisions of the Act or any state securities law, or if an
exemption from such
16
registration and qualification is available, (d) the Pooling and Servicing
Agreement contains restrictions regarding the transfer of the Retained
Certificates and (e) the Retained Certificates will bear a legend to the
foregoing effect.
(xiv) The Seller is acquiring the Retained Certificates for its own
account for investment only and not with a view to or for sale in connection
with any distribution thereof in any manner that would violate the Securities
Act or any applicable state securities laws.
(xv) The Seller is (a) a substantial, sophisticated institutional
investor having such knowledge and experience in financial and business matters,
and, in particular, in such matters related to securities similar to the
Retained Certificates, such that it is capable of evaluating the merits and
risks of investment in the Retained Certificates, (b) able to bear the economic
risks of such an investment and (c) an "accredited investor" within the meaning
of Rule 501 (a) promulgated pursuant to the Securities Act.
(xvi) The Seller has been furnished with such information concerning
the Retained Certificates and the Purchaser as has been requested by the Seller
from the Purchaser and is relevant to the Seller's decision to purchase the
Retained Certificates. The Seller has had any questions arising from such review
answered by the Purchaser to the satisfaction of the Seller.
(xvii) The Seller has not and will not nor has it authorized or will
it authorize any person to (a) offer, pledge, sell, dispose of or otherwise
transfer any Retained Certificate, any interest in any Retained Certificate or
any other similar security to any person in any manner, (b) solicit any offer to
buy or to accept a pledge, disposition of other transfer of any Retained
Certificate, any interest in any Retained Certificate or any other similar
security from any person in any manner, (c) otherwise approach or negotiate with
respect to any Retained Certificate, any interest in any Retained Certificate or
any other similar security with any person in any manner, (d) make any general
solicitation by means of general advertising or in any other manner or (e) take
any other action, that (as to any of (a) through (e) above) would constitute a
distribution of any Retained Certificate under the Securities Act, that would
render the disposition of any Retained Certificate a violation of Section 5 of
the Securities Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not sell or
otherwise transfer any of the Retained Certificates, except in compliance with
the provisions of the Pooling and Servicing Agreement.
(xviii) The Seller is not an employee benefit plan or other retirement
arrangement subject to 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"), (collectively, an "ERISA Plan"), and is not acting on
behalf of, as named fiduciary of, as trustee of, or investing the assets of an
ERISA Plan.
17
ARTICLE IV
SELLER'S COVENANTS
Section 4.01 COVENANTS OF THE SELLER.
(a) The Seller hereby covenants that except for the transfer
hereunder, the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Seller will notify the Trustee, as
assignee of the Purchaser, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Seller will defend the right, title
and interest of the Trust, as assignee of the Purchaser, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Seller; PROVIDED, HOWEVER, that nothing in this Section 4.01 shall prevent
or be deemed to prohibit the Seller from suffering to exist upon any of the
Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Seller shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(b) The Seller hereby covenants that neither it nor any affiliate of
the Seller will directly solicit any Mortgagor hereunder to refinance the
related Mortgage Loan. For the purposes of the foregoing, neither the Seller nor
any affiliate of the Seller shall be deemed to directly solicit any Mortgagor if
the Seller responds to a request from a Mortgagor regarding a refinancing or if
the Mortgagor receives marketing materials which are generally disseminated.
ARTICLE V
OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS
(a) In accordance with the terms of Section 3.16 of the Pooling and
Servicing Agreement, as to any Mortgage Loan which is Delinquent in payment by
120 days or more or any REO Property, an Affiliate of the Seller may, at its
option, purchase such Mortgage Loan from the Trust Fund at the Purchase Price
for such Mortgage Loan provided that an Affiliate of the Seller may exercise the
purchase right during the period commencing on the first day of the calendar
quarter succeeding the calendar quarter in which the Initial Delinquency Date
occurred and ending on the last Business Day of such calendar quarter. The
"Initial Delinquency Date" of a Mortgage Loan shall mean the date on which the
Mortgage Loan first became 120 days Delinquent.
(b) If an Affiliate of the Seller does not exercise the purchase right
with respect to a Mortgage Loan during the period specified in the preceding
paragraph, such Mortgage Loan shall thereafter again become eligible for
purchase pursuant to the preceding paragraph only after the Mortgage Loan ceases
to be 120 days or more Delinquent and thereafter becomes 120 day Delinquent
again.
18
ARTICLE VI
TERMINATION
Section 6.01 TERMINATION. The respective obligations and
responsibilities of the Seller and the Purchaser created hereby shall terminate
upon the termination of the Trust as provided in Section 8.01 of the Trust
Agreement.
ARTICLE VII
MISCELLANEOUS PROVISIONS
Section 7.01 AMENDMENT. This Agreement may be amended from time to
time by the Seller and the Purchaser, by written agreement signed by the Seller
and the Purchaser.
Section 7.02 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
Section 7.03 NOTICES. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, postage prepaid, addressed
as follows:
if to the Seller:
Credit-Based Asset Servicing and Securitization LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
or such other address as may hereafter be furnished to the Purchaser in writing
by the Seller.
if to the Purchaser:
Citigroup Mortgage Loan Trust Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Mortgage Finance Group
or such other address as may hereafter be furnished to the Seller in writing by
the Purchaser.
Section 7.04 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be held
invalid for any reason whatsoever, then such covenants, agreements, provisions
or terms shall be deemed severable
19
from the remaining covenants, agreements, provisions or terms of this Agreement
and shall in no way affect the validity or enforceability of the other
provisions of this Agreement.
Section 7.05 COUNTERPARTS. This Agreement may be executed in one or
more counterparts by the different parties hereto on separate counterparts, each
of which, when so executed, shall be deemed to be an original and such
counterparts, together, shall constitute one and the same agreement.
Section 7.06 FURTHER AGREEMENTS. The Purchaser and the Seller each
agree to execute and deliver to the other such additional documents, instruments
or agreements as may be necessary or reasonable and appropriate to effectuate
the purposes of this Agreement or in connection with the issuance of any Series
of Certificates representing interests in the Mortgage Loans.
Without limiting the generality of the foregoing, as a further
inducement for the Purchaser to purchase the Mortgage Loans from the Seller, the
Seller will cooperate with the Purchaser in connection with the sale of any of
the securities representing interests in the Mortgage Loans. In that connection,
the Seller will provide to the Purchaser any and all information and appropriate
verification of information, whether through letters of its auditors and counsel
or otherwise, as the Purchaser shall reasonably request and will provide to the
Purchaser such additional representations and warranties, covenants, opinions of
counsel, letters from auditors, and certificates of public officials or officers
of the Seller as are reasonably required in connection with such transactions
and the offering of investment grade securities rated by the Rating Agencies.
Section 7.07 INTENTION OF THE PARTIES. It is the intention of the
parties that the Purchaser is purchasing, and the Seller is selling, the
Mortgage Loans rather than the pledging of the Mortgage Loans by the Seller to
secure a loan by the Purchaser to the Seller. Accordingly, the parties hereto
each intend to treat the transaction for Federal income tax purposes and all
other purposes as a sale by the Seller and a purchase by the Purchaser of the
Mortgage Loans. The Purchaser will have the right to review the Mortgage Loans
and the related Mortgage Files to determine the characteristics of the Mortgage
Loans which will affect the Federal income tax consequences of owning the
Mortgage Loans and the Seller will cooperate with all reasonable requests made
by the Purchaser in the course of such review.
Section 7.08 SUCCESSORS AND ASSIGNS; ASSIGNMENT OF THIS AGREEMENT.
This Agreement shall bind and inure to the benefit of and be enforceable by the
Seller, the Purchaser and the Trustee. The obligations of the Seller under this
Agreement cannot be assigned or delegated to a third party without the consent
of the Purchaser and which consent shall be at the Purchaser's sole discretion,
except that the Purchaser acknowledges and agrees that the Seller may assign its
obligations hereunder to any Person into which the Seller is merged or any
corporation resulting from any merger, conversion or consolidation to which the
Seller is a party or any Person succeeding to the business of the Seller. The
parties hereto acknowledge that the Purchaser is acquiring the Mortgage Loans
for the purpose of contributing them to a trust that
20
will issue a series of certificates representing undivided interests in such
Mortgage Loans. As an inducement to the Purchaser to purchase the Mortgage
Loans, the Seller acknowledges and consents to the assignment by the Purchaser
to the Trustee of all of the Purchaser's rights against the Seller pursuant to
this Agreement insofar as such rights relate to Mortgage Loans transferred to
the Trustee and to the enforcement or exercise of any right or remedy against
the Seller pursuant to this Agreement by the Trustee. Such enforcement of a
right or remedy by the Trustee shall have the same force and effect as if the
right or remedy had been enforced or exercised by the Purchaser directly.
Section 7.09 SURVIVAL. The representations and warranties set forth in
Sections 3.01 and 3.02 hereof shall survive the purchase of the Mortgage Loans
hereunder.
21
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed to this Mortgage Loan Purchase Agreement by their respective
officers thereunto duly authorized as of the day and year first above written.
CITIGROUP MORTGAGE LOAN TRUST
INC.,
as Purchaser
By:____________________________________
Name:
Title:
CREDIT-BASED ASSET SERVICING
AND SECURITIZATION LLC, as Seller
By:____________________________________
Name:
Title:
22
SCHEDULE I
MORTGAGE LOAN SCHEDULE
EXHIBIT 1
EXHIBIT H
FORM OF LOST NOTE AFFIDAVIT
Personally appeared before me the undersigned authority to administer
oaths, ______________________ who first being duly sworn deposes and says:
Deponent is ______________________ of ______________________________, successor
by merger to _________________________________________ ("Seller") and who has
personal knowledge of the facts set out in this affidavit.
On ___________________, _________________________ did execute and
deliver a promissory note in the principal amount of $__________.
That said note has been misplaced or lost through causes unknown and
is presently lost and unavailable after diligent search has been made. Seller's
records show that an amount of principal and interest on said note is still
presently outstanding, due, and unpaid, and Seller is still owner and holder in
due course of said lost note.
Seller executes this Affidavit for the purpose of inducing U.S. Bank
National Association, as trustee on behalf of C-BASS Mortgage Loan Asset-Backed
Certificates, Series 2004-CB7, to accept the transfer of the above described
loan from Seller.
Seller agrees to indemnify and hold harmless U.S. Bank National
Association, Citigroup Mortgage Loan Trust Inc., Citigroup Global Markets Inc.
and Greenwich Capital Markets, Inc. for any losses incurred by such parties
resulting from the above described promissory note has been lost or misplaced.
By:
Name:
Title:
H-1
STATE OF )
) SS:
COUNTY OF )
On this ____ day of _______ 20__, before me, a Notary Public, in and
for said County and State, appeared ________________________, who acknowledged
the extension of the foregoing and who, having been duly sworn, states that any
representations therein contained are true.
Witness my hand and Notarial Seal this ____ day of _______ 20__.
My commission expires .
H-2
EXHIBIT I
FORM OF ERISA REPRESENTATION
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Citigroup Mortgage Loan Trust Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7
Ladies and Gentlemen:
1. [The undersigned is the ______________________ of (the
"Transferee") a [corporation duly organized] and existing under the laws of
__________, on behalf of which he makes this affidavit.] [The undersigned,
___________________, is the transferee (the "Transferee").]
2. The Transferee hereby acknowledges that under the terms of the
Pooling and Servicing Agreement (the "Agreement") among Citigroup Mortgage Loan
Trust Inc., as depositor (the "Depositor"), Credit-Based Asset Servicing and
Securitization LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as servicer and U.S.
Bank National Association, as trustee (the "Trustee"), no transfer of the
ERISA-Restricted Certificates shall be permitted to be made to any person unless
the Depositor and the Certificate Registrar (as defined in the Agreement) have
received a certificate from such transferee in the form hereof.
3. The Transferee either (x) (i) is not an employee benefit plan
subject to Section 406 or Section 407 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"), the Trustee of any such plan or a person
acting on behalf of any such plan nor a person using the assets of any such plan
or (ii) (except in the case of the Residual, Class X or Class N Certificates) is
an insurance company which is purchasing such Certificates with funds contained
in an "insurance company general account" (as such term is defined in Section
V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60") and that the
purchase and holding of such Certificates are covered under Sections I and III
of PTCE 95-60 or (y) (except in the case of a Mezzanine or Residual Certificate)
shall deliver to the Certificate Registrar and the Depositor an opinion of
counsel (a "Benefit Plan Opinion") satisfactory to the Certificate Registrar,
and upon which the Certificate Registrar and the Depositor shall be entitled to
rely, to the effect that the purchase and holding of such Certificate by the
Transferee will not result in the assets of the Trust Fund being deemed to be
plan assets and subject to the prohibited transaction provisions of ERISA or the
Code and will not subject the Trustee, the Certificate Registrar or the
Depositor to any obligation in addition to those undertaken by such entities in
the Pooling and
I-1
Servicing Agreement, which opinion of counsel shall not be an expense of the
Trustee or the Depositor.
I-2
Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Agreement.
IN WITNESS WHEREOF, the Transferee has executed this certificate.
[Transferee]
By:
Name:
Title:
▇-▇
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF INVESTMENT LETTER [NON-RULE 144A]
[DATE]
Citigroup Mortgage Loan Trust Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7
Ladies and Gentlemen:
In connection with our acquisition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB7 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are acquiring the Certificates for investment
for our own account and not with a view to any distribution of such Certificates
(but without prejudice to our right at all times to sell or otherwise dispose of
the Certificates in accordance with clause (g) below), (e) we agree that the
Certificates must be held indefinitely by us and we acknowledge that we are able
to bear the economic risk of investment in the Certificates, (f) we have not
offered or sold any Certificates to, or solicited offers to buy any Certificates
from, any person, or otherwise approached or negotiated with any person with
respect thereto, or taken any other action which would result in a violation of
Section 5 of the Act, (g) we will not sell, transfer or otherwise dispose of any
Certificates unless (1) such sale, transfer or other disposition is made
pursuant to an effective registration statement under the Act or is exempt from
such registration requirements, and if requested, we will at our expense provide
an opinion of counsel satisfactory to the addressees of this Certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this
certificate, and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Pooling and Servicing Agreement and (h)
we acknowledge that the Certificates will bear a legend setting forth the
applicable restrictions on transfer.
J-1-1
Very truly yours,
[NAME OF TRANSFEREE]
By:
Authorized Officer
J-1-2
EXHIBIT J-2
FORM OF INVESTMENT LETTER [RULE 144A]
[DATE]
Citigroup Mortgage Loan Trust Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7
Ladies and Gentlemen:
In connection with our acquisition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB7 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have had the
opportunity to ask questions of and receive answers from the Depositor
concerning the purchase of the Certificates and all matters relating thereto or
any additional information deemed necessary to our decision to purchase the
Certificates, (c) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Certificates, any
interest in the Certificates or any other similar security to, or solicited any
offer to buy or accept a transfer, pledge or other disposition of the
Certificates, any interest in the Certificates or any other similar security
from, or otherwise approached or negotiated with respect to the Certificates,
any interest in the Certificates or any other similar security with, any person
in any manner, or made any general solicitation by means of general advertising
or in any other manner, or taken any other action, that would constitute a
distribution of the Certificates under the Securities Act or that would render
the disposition of the Certificates a violation of Section 5 of the Securities
Act or require registration pursuant thereto, nor will act, nor has authorized
or will authorize any person to act, in such manner with respect to the
Certificates, (d) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2. We
are aware that the sale to us is being made in reliance on Rule 144A. We are
acquiring the Certificates for our own account or for resale pursuant to Rule
144A and further, understand that such Certificates may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the Securities Act.
J-2-1
Very truly yours,
[NAME OF TRANSFEREE]
By:
Authorized Officer
J-2-2
ANNEX 1 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
i. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
ii. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned
and/or invested on a discretionary basis $ 1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts or
similar business trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal Revenue Code of 1986,
as amended.
___ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or
similar official or is a foreign bank or equivalent institution, and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is attached
hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead association
or similar institution, which is supervised and examined by a State or
Federal authority having supervision over any such institutions or is
a foreign savings and loan association or equivalent institution and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is attached
hereto.
___ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
----------
1 Buyer must own and/or invest on a discretionary basis at least $__________
in securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $__________ in securities.
J-2-3
___ Insurance Company. The Buyer is an insurance company whose primary
and predominant business activity is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and which is
subject to supervision by the insurance commissioner or a similar
official or agency of a State, territory or the District of Columbia.
___ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Buyer is an investment advisor registered
under the Investment Advisors Act of 1940.
___ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business Administration
under Section 301(c) or (d) of the Small Business Investment Act of
1958.
___ Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisors
Act of 1940.
iii. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned but
subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
iv. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer is a
majority-owned, consolidated subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
v. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will
J-2-4
continue to rely on the statements made herein because one or more sales to the
Buyer may be in reliance on Rule 144A.
vi. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
Print Name of Buyer
By:
Name:
Title:
Date:
J-2-5
ANNEX 2 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
___ The Buyer owned $ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule
144A).
___ The Buyer is part of a Family of Investment Companies which owned
in the aggregate $ in securities (other than the excluded securities
referred to below) as of the end of the Buyer's most recent fiscal
year (such amount being calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) securities issued or guaranteed by
the U.S. or any instrumentality thereof, (iii) bank deposit notes and
certificates of deposit, (iv) loan participations, (v) repurchase agreements,
(vi) securities owned but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps.
J-2-6
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the undersigned
will notify the parties listed in the Rule 144A Transferee Certificate to which
this certification relates of any changes in the information and conclusions
herein. Until such notice is given, the Buyer's purchase of the Certificates
will constitute a reaffirmation of this certification by the undersigned as of
the date of such purchase.
Print Name of Buyer or Adviser
By:
Name:
Title:
IF AN ADVISER:
Print Name of Buyer
Date:
J-2-7
EXHIBIT K
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2004-CB7
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is [an officer of] , the proposed Transferee of an
Ownership Interest in a [Class R and/or Class R-X Certificates] (the
"Certificates") issued pursuant to the Pooling and Servicing Agreement, (the
"Agreement"), relating to the above-referenced Certificates, among Citigroup
Mortgage Loan Trust Inc., as depositor, Credit-Based Asset Servicing and
Securitization LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as servicer and U.S.
Bank National Association, as trustee. Capitalized terms used, but not defined
herein shall have the meanings ascribed to such terms in the Agreement. The
Transferee has authorized the undersigned to make this affidavit on behalf of
the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificates either (i) for its own account or (ii) as
nominee, trustee or agent for another Person and has attached hereto an
affidavit from such Person in substantially the same form as this affidavit. The
Transferee has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Certificates to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax will
be imposed on a "pass-through entity" holding the Certificates if at any time
during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a partnership, trust or estate,
and certain cooperatives and, except as may be provided in Treasury Regulations,
persons holding interests in pass-through entities as a nominee for another
Person.)
K-1
5. The Transferee has reviewed the provisions of Section 5.02(d) of
the Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificates including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(d) of the Agreement and the
restrictions noted on the face of the Certificates. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificates, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth in this Exhibit K to the Agreement (a "Transferor Certificate")
to the effect that such Transferee has no actual knowledge that the Person to
which the Transfer is to be made is not a Permitted Transferee.
7. The Transferee does not have the intention to impede the assessment
or collection of any tax legally required to be paid with respect to the
Certificates.
8. The Transferee's taxpayer identification number is .
9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
10. The Transferee is aware that the Certificates may be a
"noneconomic residual interest" within the meaning of proposed Treasury
regulations promulgated pursuant to the Code and that the transferor of a
noneconomic residual interest will remain liable for any taxes due with respect
to the income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.
11. The Transferee is not an employee benefit plan that is subject to
ERISA or a plan that is subject to Section 4975 of the Code, nor are we acting
on behalf of such a plan.
K-2
IN WITNESS WHEREOF, the Transferee has caused this instrument
to be executed on its behalf, pursuant to authority of its Board of Directors,
by its duly authorized officer and its corporate seal to be hereunto affixed,
duly attested, this day of , 20 .
[NAME OF TRANSFEREE]
By:
Name:
Title:
[Corporate Seal]
ATTEST:
[Assistant] Secretary
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
Transferee, and acknowledged that he executed the same as his free act and deed
and the free act and deed of the Transferee.
Subscribed and sworn before me this____ day of____ , 20__.
NOTARY PUBLIC
My Commission expires the day
of , 20 .
---------------- --
K-3
EXHIBIT L
FORM OF TRANSFEROR CERTIFICATE
[DATE]
U.S. Bank National Association
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Citigroup Mortgage Loan Trust Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7
Ladies and Gentlemen:
In connection with our disposition of the C-BASS Mortgage Loan
Asset-Backed Certificates, Series 2004-CB7 (the "Certificates"), we certify that
(a) we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act, (c) [in
the case of a Residual Certificate only] to the extent we are disposing of a
Class [R, or R-X] Certificate, we have no knowledge the Transferee is not a
Permitted Transferee and (d) [in the case of a Residual Certificate only] no
purpose of the proposed disposition of a Class [R, or R-X] Certificate is to
impede the assessment or collection of tax.
Very truly yours,
[TRANSFEROR]
By: ______________________________
Name:
Title:
L-1
EXHIBIT M
MONTHLY INFORMATION PROVIDED BY SERVICER
1. With respect to the Mortgage Pool, the number and Principal Balances
of all Mortgage Loans which were the subject of Principal Prepayments
during the related Due Period.
2. With respect to the Mortgage Pool, the amount of all curtailments
which were received during the related Due Period.
3. With respect to the Mortgage Pool, the aggregate amount of principal
portion of all Monthly Payments received during the related Due
Period.
4. With respect to the Mortgage Pool, the amount of interest received on
the Mortgage Loans during the related Due Period.
5. With respect to the Mortgage Pool, the aggregate amount of the
Advances made and recovered with respect to such Distribution Date.
6. With respect to the Mortgage Pool, the delinquency and foreclosure
information and the amount of Mortgage Loan Losses during the related
Due Period.
7. With respect to the Mortgage Pool, the weighted average maturity, the
weighted average Mortgage Interest Rate and the weighted average Net
Mortgage Interest Rate as of the last day of the Due Period preceding
of the related Interest Accrual Period.
8. The Servicing Fees paid and Servicing Fees accrued during the related
Due Period.
9. The amount of all payments or reimbursements to the Servicer paid or
to be paid since the prior Distribution Date (or in the case of the
first Distribution Date, since the Closing Date).
10. The Pool Balance.
11. With respect to the Mortgage Pool, the number of Mortgage Loans
outstanding at the beginning and at the end of the related Due Period.
12. The aggregate interest accrued on the Mortgage Loans at their
respective Mortgage Interest Rates for the related Due Period.
13. The amount deposited in the Collection Account which may not be
withdrawn therefrom pursuant to an Order of a United States Bankruptcy
Court of competent jurisdiction imposing a stay pursuant to Section
362 of U.S. Bankruptcy Code.
14. The aggregate Realized Losses since the Cut-off Date as of the end of
the related Due Period.
15. The LIBOR Carryover Amount for the Offered Certificates and the Class
B-2, Class B-3 and the Class B-4 Certificates, if any, with respect to
such Distribution Date.
M-1
16. The Overcollateralized Amount, the Targeted Overcollateralization
Amount and any Overcollateralization Deficiency, in each case after
giving effect to distributions on such Distribution Date.
M-2
EXHIBIT N
FORM OF OFFICER'S CERTIFICATE WITH RESPECT TO PREPAYMENTS
Officer's Certificate
C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB7
[DATE]
VIA FACSIMILE
U.S. Bank National Association, Trustee
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇-▇▇-▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Re: Prepayments
Dear Sir or Madam:
__________________ hereby certifies that he/she is an officer of the
Servicer, holding the office set forth beneath his/her name and hereby further
certifies as follows:
With respect to the Mortgage Loans set forth in the attached
schedule:
1. A Principal Prepayment in full was received during the
related Collection Period;
2. Any prepayment penalty due under the terms of the Mortgage
Note with respect to such Principal Prepayment in full was
received from the mortgagor and deposited in the Collection
Account: ____ Yes ____ No
3. As to each Mortgage Loan so noted on the attached schedule,
all or part of the prepayment penalty required in connection
with the Principal Prepayment in full was waived based upon
(Circle one):
(i) the Servicer's determination that such waiver would
maximize recovery of Liquidation Proceeds for such Mortgage
Loan, taking into account the value of such prepayment
penalty, or
(ii)(A) the enforceability thereof be limited (1) by
bankruptcy insolvency, moratorium, receivership, or other
similar law relating to creditors' rights generally or (2)
due to acceleration in connection with a foreclosure or
other involuntary payment, or (B) the enforceability is
otherwise limited or prohibited by applicable law;
N-1
4. We certify that all amounts due in connection with the
waiver of a prepayment penalty inconsistent with number 3
above which are required to be deposited by the Servicer
pursuant to Section 3.01 of the Pooling and Servicing
Agreement, have been or will be so deposited.
Capitalized terms used herein shall have the meanings ascribed to such
terms in the Pooling and Servicing Agreement, dated October 1, 2004, among
Citigroup Mortgage Loan Trust Inc., as depositor, Credit-Based Asset Servicing
and Securitization LLC, as seller, ▇▇▇▇▇▇ Loan Servicing LP, as servicer and
U.S. Bank National Association, as trustee.
▇▇▇▇▇▇ LOAN SERVICING LP
By:
Name:
Title:
N-2
EXHIBIT O-1
FORM OF CERTIFICATION TO BE PROVIDED BY THE SERVICER WITH FORM 10-K
Certification
1. I have reviewed this annual report on Form 10-K, and all reports on
Form 8-K containing distribution or servicing reports filed in respect of
periods included in the year covered by this annual report, of Citigroup
Mortgage Loan Trust, Series 2004-CB7, C-BASS Mortgage Loan Asset-Backed
Certificates;
2. Based on my knowledge, the information in these reports, taken as a
whole, does 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 as of the
last day of the period covered by this annual report;
3. Based on my knowledge, the distribution or servicing information
required to be provided to the trustee by the servicer under the pooling and
servicing, or similar, agreement, for inclusion in these reports is included in
these reports;
4. Based on my knowledge and upon the annual compliance statement
included in the report and required to be delivered to the trustee in accordance
with the terms of the pooling and servicing, or similar, agreement, and except
as disclosed in the reports, the servicer has fulfilled its obligations under
the servicing agreement; and
5. The reports disclose all significant deficiencies relating to the
servicer's compliance with the minimum servicing standards based upon the report
provided by an independent public accountant, after conducting a review in
compliance with the Uniform Single Attestation Program for Mortgage Bankers or
similar procedure, as set forth in the pooling and servicing, or similar,
agreement, that is included in these reports.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: U.S. Bank
National Association.
▇▇▇▇▇▇ LOAN SERVICING LP
By:____________________________________
Name:
Title:
Date:
O-1-1
EXHIBIT O-2
FORM OF CERTIFICATION TO BE
PROVIDED TO Servicer BY THE TRUSTEE
Re: C-BASS Mortgage Loan Asset-Backed Certificates, Series
2004-CB7
I, [identify the certifying individual], certify to ▇▇▇▇▇▇ Loan
Servicing LP (the "Servicer"), and its officers, directors and affiliates, and
with the knowledge and intent that they will rely upon this certification, that:
1. I have reviewed the annual report on Form 10 K for the fiscal year
[___], and all reports on Form 8-K containing Monthly Statements filed in
respect of periods included in the year covered by that annual report, of
Citigroup Mortgage Loan Trus, Inc. (the "Depositor") relating to the above
referenced trust;
2. Subject to paragraph 4 hereof, based on my knowledge, the
Distribution Information in the Monthly Statements prepared by the Trustee,
taken as a whole, does 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 as of
the last day of the period covered by that annual report; and
3. Based on my knowledge, the Distribution Information required to be
provided by the Trustee under the Pooling and Servicing Agreement is included in
these reports.
4. In compiling the Distribution Information and making the foregoing
certifications, the Trustee has relied upon information furnished to it by the
Servicer under the Pooling and Servicing Agreement. The Trustee shall have no
responsibility or liability for any inaccuracy in such reports resulting from
information so provided to it by the Servicer.
Capitalized terms used but not defined herein have the meanings
ascribed to them in the Pooling and Servicing Agreement, dated October 1, 2004
(the "Pooling and Servicing Agreement"), among the Depositor, Credit-Based Asset
Servicing and Securitization LLC, as seller, the Servicer, and U.S. Bank
National Association, as trustee.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:__________________________________
Name:
Title:
Date:
O-2-1
EXHIBIT P
FORM OF POWER OF ATTORNEY
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO
▇▇▇▇▇▇ LOAN SERVICING LP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: _________________________________
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that U.S. Bank National Association,
having its principal place of business at ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, as Trustee (the "Trustee") pursuant to that Pooling and
Servicing Agreement among Citigroup Mortgage Loan Trust Inc. as depositor (the
"Depositor"), ▇▇▇▇▇▇ Loan Servicing LP (the "Servicer"), Credit-Based Asset
Servicing and Securities LLC and the Trustee, dated as of October 1, 2004 (the
"Pooling and Servicing Agreement"), hereby constitutes and appoints the
Servicer, by and through the Servicer's officers, the Trustee's true and lawful
Attorney-in-Fact, in the Trustee's name, place and stead and for the Trustee's
benefit, in connection with all mortgage loans serviced by the Servicer pursuant
to the Pooling and Servicing Agreement for the purpose of performing all acts
and executing all documents in the name of the Trustee as may be customarily and
reasonably necessary and appropriate to effectuate the following enumerated
transactions in respect of any of the mortgages or deeds of trust (the
"Mortgages" and the "Deeds of Trust", respectively) and promissory notes secured
thereby (the "Mortgage Notes") for which the undersigned is acting as Trustee
for various certificateholders (whether the undersigned is named therein as
mortgagee or beneficiary or has become mortgagee by virtue of endorsement of the
Mortgage Note secured by any such Mortgage or Deed of Trust) and for which the
Servicer is acting as servicer, all subject to the terms of the Pooling and
Servicing Agreement.
This appointment shall apply to the following enumerated transactions
only:
1. The modification or re-recording of a Mortgage or Deed of Trust,
where said modification or re-recordings is for the purpose of correcting the
Mortgage or Deed of Trust to conform same to the original intent of the parties
thereto or to correct title errors discovered after such title insurance was
issued and said modification or re-recording, in either instance, does not
adversely affect the lien of the Mortgage or Deed of Trust as insured.
2. The subordination of the lien of a Mortgage or Deed of Trust to an
easement in favor of a public utility company of a government agency or unit
with powers of eminent domain; this section shall include, without limitation,
the execution of partial satisfactions/releases, partial reconveyances or the
execution or requests to trustees to accomplish same.
P-1
3. The conveyance of the properties to the mortgage insurer, or the
closing of the title to the property to be acquired as real estate owned, or
conveyance of title to real estate owned.
4. The completion of loan assumption agreements.
5. The full satisfaction/release of a Mortgage or Deed of Trust or
full conveyance upon payment and discharge of all sums secured thereby,
including, without limitation, cancellation of the related Mortgage Note.
6. The assignment of any Mortgage or Deed of Trust and the related
Mortgage Note, in connection with the repurchase of the mortgage loan secured
and evidenced thereby.
7. The full assignment of a Mortgage or Deed of Trust upon payment and
discharge of all sums secured thereby in conjunction with the refinancing
thereof, including, without limitation, the assignment of the related Mortgage
Note.
8. With respect to a Mortgage or Deed of Trust, the foreclosure, the
taking of a deed in lieu of foreclosure, or the completion of judicial or
non-judicial foreclosure or termination, cancellation or rescission of any such
foreclosure, including, without limitation, any and all of the following acts:
a. the substitution of trustee(s) serving under a Deed of
Trust, in accordance with state law and the Deed of Trust;
b. the preparation and issuance of statements of breach or
non-performance;
c. the preparation and filing of notices of default and/or
notices of sale;
d. the cancellation/rescission of notices of default and/or
notices of sale;
e. the taking of a deed in lieu of foreclosure; and
f. the preparation and execution of such other documents and
performance of such other actions as may be necessary under the terms
of the Mortgage, Deed of Trust or state law to expeditiously complete
said transactions in paragraphs 8.a. through 8.e., above.
The undersigned gives said Attorney-in-Fact full power and authority
to execute such instruments and to do and perform all and every act and thing
necessary and proper to carry into effect the power or powers granted by or
under this Limited Power of Attorney as fully as the undersigned might or could
do, and hereby does ratify and confirm to all that said Attorney-in-Fact shall
lawfully do or cause to be done by authority hereof.
P-2
Third parties without actual notice may rely upon the exercise of the
power granted under this Limited Power of attorney; and may be satisfied that
this Limited Power of Attorney shall continue in full force and effect and has
not been revoked unless an instrument of revocation has been made in writing by
the undersigned.
P-3
IN WITNESS WHEREOF, U.S. Bank National Association as Trustee pursuant to that
Pooling and Servicing Agreement among the Depositor, the Servicer, and the
Trustee, dated as of October 1, 2004 (Citigroup Mortgage Loan Trust, Series
2004-CB7, C-BASS Mortgage Loan Asset-Backed Certificates), has caused its
corporate seal to be hereto affixed and these presents to be signed and
acknowledged in its name and behalf by _______ its duly elected and authorized
Vice President this _____ day of ______, 200__.
As Trustee for Citigroup Mortgage Loan Trust,
Series 2004-CB7, C-BASS Mortgage Loan Asset-Backed Certificates
By __________________________________
STATE OF
----------------------------------------------
COUNTY OF
------------------------------------------
On ___________, 200__, before me, the undersigned, a Notary Public in and for
said state, personally appeared ___________, Vice President of U.S. Bank
National Association as Trustee for Citigroup Mortgage Loan Trust, Series
2004-CB7 C-BASS Mortgage Loan Asset-Backed Certificates, personally known to me
to be the person whose name is subscribed to the within instrument and
acknowledged to me that he/she executed that same in his/her authorized
capacity, and that by his/her signature on the instrument the entity upon behalf
of which the person acted and executed the instrument.
WITNESS my hand and official seal.
(SEAL)
================================================================================
Notary Public
My Commission Expires ________________________
P-4
EXHIBIT Q
FORM OF CAP CONTRACTS
AVAILABLE UPON REQUEST
Q-1