CITICORP MORTGAGE SECURITIES, INC.
Packager and Servicer
and
THE BANK OF NEW YORK
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 1996
REMIC PASS-THROUGH CERTIFICATES,
SERIES 1996-1
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TABLE OF CONTENTS
ARTICLE XII
TERMS FOR SERIES 1996-1 CERTIFICATES
Section 12.01. General Terms for Certificates 2
Section 12.02. Accrual Date 6
Section 12.03. Advance Account Trigger Applicability 6
Section 12.04. Assumed Reinvestment Rate 6
Section 12.05. Authenticating Agent 6
Section 12.06. Available PO Loss Funds 6
Section 12.07. Book-Entry Certificates 7
Section 12.08. Cash Deposited into Certificate Account 7
Section 12.09. Certificate Registrar 7
Section 12.10. Class A Optimal Principal Amount. 7
Section 12.11. Class A Percentage. 7
Section 12.12. Class A PO Principal Amount 7
Section 12.13. Class A Prepayment Percentage. 7
Section 12.14. Class A Principal Distribution Amount. 8
Section 12.15 Class A-IO Interest Amount. 8
Section 12.16. Class A-3 Notional Amount. 9
Section 12.17. Class B Percentage 9
Section 12.18 Class B Prepayment Percentage 9
Section 12.19. Clearing Agency. 9
Section 12.20. Corporate Trust Office 9
Section 12.21. Current Class B-1 Subordination Level. 9
Section 12.22. Current Class B-2 Subordination Level. 9
Section 12.23. Current Class B-3 Subordination Level. 9
Section 12.24. Current Class B-4 Subordination Level. 9
Section 12.25. Current Class M Subordination Level. 9
Section 12.26. Cut-Off Date 9
Section 12.27. Definitive Certificat 10
Section 12.28. Denominations 10
Section 12.29. Deposit Date 10
Section 12.30. Depository 10
Section 12.31. Designated Interest Accrual Date 10
Section 12.32. Determination Date 10
Section 12.33. Discount Mortgage Loans 10
Section 12.34. Distributable Class A-IO Interest Amount 10
Section 12.35. Distribution Date 10
Section 12.36. Group I Class A CitiCertificates 10
Section 12.37. Group I Final Distribution Date 10
Section 12.38. Group I Non-PO Principal Amount 10
Section 12.39. Group I Percentage 11
Section 12.40. Group I Prepayment Percentage 11
Section 12.41. Group I Reimbursement Percentage 12
Section 12.42 Group II Non-PO Principal Amount 12
Section 12.43. Group II Percentage 13
Section 12.44. Group II Prepayment Percentage 13
Section 12.45. Group II Reimbursement Percentage 13
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Section 12.46. Initial Bankruptcy Loss Amount 13
Section 12.47. Initial Fraud Loss Amount 13
Section 12.48. Initial Special Hazard Loss Amount 13
Section 12.49. Initial Special Hazard Percentage 13
Section 12.50. Initial Stated Amount 13
Section 12.51. Investment Account 13
Section 12.52. Investor Rate 13
Section 12.53. Issue Date 13
Section 12.54. Last Scheduled Distribution Date 13
Section 12.55. LIBOR 13
Section 12.56. LIBOR Accrual Date 13
Section 12.57. LIBOR CitiCertificates 13
Section 12.58. LIBOR Determination Date 13
Section 12.59. Lower-Tier Classes 13
Section 12.60. Lower-Tier REMIC. 14
Section 12.61. Mortgage Document Custodian 14
Section 12.62. Mortgage Loans 14
Section 12.63. Mortgage Note Custodian 14
Section 12.64. Net Note Rate 14
Section 12.65. Non-PO Percentage 14
Section 12.66. Notices 14
Section 12.67. Original Class A Percentage 14
Section 12.68. Original Class A Stated Amount 14
Section 12.69. Original Class B-1 Percentage 14
Section 12.70. Original Class B-1 Stated Amount 15
Section 12.71. Original Class B-1 Subordination Level 15
Section 12.72. Original Class B-2 Percentage 15
Section 12.73. Original Class B-2 Stated Amount 15
Section 12.74. Original Class B-2 Subordination Level 15
Section 12.75. Original Class B-3 Percentage 15
Section 12.76. Original Class B-3 Stated Amount 15
Section 12.77. Original Class B-3 Subordination Level 15
Section 12.78. Original Class B-4 Percentage 15
Section 12.79. Original Class B-4 Stated Amount 15
Section 12.80. Original Class B-4 Subordination Level 15
Section 12.81. Original Class B-5 Percentage 15
Section 12.82. Original Class B-5 Stated Amount 15
Section 12.83. Original Class B-5 Subordination Level 15
Section 12.84. Original Class M Stated Amount 15
Section 12.85. Original Class M Percentage 15
Section 12.86. Original Class M Subordination Level 16
Section 12.87. Original Subordinated Stated Amount 16
Section 12.88. Paying Agent 16
Section 12.89. PO Loss Amount 16
Section 12.90. PO Percentage 16
Section 12.91. Premium Mortgage Loan 16
Section 12.92. Pro Rata Allocation Test 16
Section 12.93. Rating Agencies 16
Section 12.94. Record Date 16
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Section 12.95. Reference Banks 17
Section 12.96. Right to Repurchase 17
Section 12.97. Servicing Fee 17
Section 12.98. Single Certificate 17
Section 12.99. Spread Percentage 17
Section 12.99A. Standard Accrual Period 17
Section 12.99B. Startup Day 17
Section 12.99C. Stated Rate 17
Section 12.99D. Trustee Advances 17
Section 12.99E. Unpaid PO Loss Amount 17
Section 12.99F. Upper-Tier Certificates 17
Section 12.99G. Upper-Tier REMIC. 17
Section 12.99H. Wire Transfer Eligibility 18
Section 12.99I. REMIC-Related Covenants 18
Section 12.99J. Expenses and Liabilities of the Trust Fund 18
Section 12.99K. Tax Matters Person 18
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ARTICLE XIII
SUBORDINATION; PRIORITIES; ALLOCATION OF LOSSES
Section 13.01. Subordination; Priority of Distributions. 20
Section 13.02. Allocation of Realized Losses; Recoveries 22
Section 13.03. Class L Regular Interest Allocations
and Distributions 24
Section 13.04. Distributions on the Residual Certificates 25
EXHIBITS
EXHIBIT A-1 Form of Class A-1 CitiCertificates................A-1-1
EXHIBIT A-2 Form of Class A-2 CitiCertificates................A-2-1
EXHIBIT A-3 Form of Class A-3 CitiCertificates................A-3-1
EXHIBIT A-4 Form of Class A-4 through A-8 CitiCertificates....A-4-1
EXHIBIT A-5 Form of Class A-9 CitiCertificates................A-5-1
EXHIBIT A-6 Form of Class B-1 through B-2 CitiCertificates....A-6-1
EXHIBIT A-7 Form of Class B-3 through B-5 CitiCertificates....A-7-1
EXHIBIT A-8 Form of Class LR Certificate......................A-8-1
EXHIBIT A-9 Form of Class R Certificate.......................A-9-1
EXHIBIT A-10 Form of Class M CitiCertificates.................A-10-1
EXHIBIT A-11 Form of Class A-IO Certificates..................A-11-1
EXHIBIT B-1 Schedule of Mortgage Loans - Deemed Incorporated....B-1
EXHIBIT C-1 Form of Mortgage Document Custodial Agreement.......C-1
EXHIBIT D Form of Subservicing Agreement......................D-1
EXHIBIT E Form of Purchaser Letter............................E-1
EXHIBIT F Form of ERISA Letter................................F-1
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THIS POOLING AND SERVICING AGREEMENT ("this Pooling Agreement" or
"this Agreement"), dated as of December 1, 1996 between CITICORP MORTGAGE
SECURITIES, INC., a corporation organized and existing under the laws of the
State of Delaware ("CMSI"), and THE BANK OF NEW YORK, a New York banking
corporation in its individual capacity and as trustee (the "Trustee").
WITNESSETH THAT:
In the regular course of their business, certain affiliates of CMSI
originate and acquire Mortgage Loans. CMSI and the Trustee wish to set forth the
terms and conditions pursuant to which the Trust Fund will acquire the Mortgage
Loans listed in Exhibit B hereto. Certificates will be issued to Holders
evidencing ownership interests in such Trust Fund and CMSI will manage and
service such Mortgage Loans. In consideration of the mutual agreements herein
contained, CMSI and the Trustee agree as follows:
ARTICLES I-XI
INCORPORATION BY REFERENCE
Those certain Standard Terms for Pooling and Servicing Agreements for
Single-Tier Three-Class A-IO CitiCertificates dated as of December 1, 1996 (the
"Standard Terms"), a copy of which is attached hereto, as amended hereby, are
incorporated by reference herein as if set forth in full. Such Standard Terms,
as so amended, are hereby affirmed by, and shall constitute a part of this
Agreement between, the parties hereto. For purposes of this Pooling Agreement
and the Certificates executed and delivered hereunder, the terms "this
Agreement," "herein," "hereof" and words of similar import shall refer to this
Pooling Agreement including the Standard Terms as incorporated herein with such
modifications or amendments with respect to the related series of Certificates
as may be set forth in this Pooling Agreement.
ARTICLE XII
TERMS FOR SERIES 1996-1 CERTIFICATES
On December 19, 1996 (the "Issue Date") there shall be established
pursuant to the terms of, and authenticated under, this Pooling Agreement a
series of certificates known and designated as "Citicorp Mortgage Securities,
Inc., REMIC Pass-Through Certificates, Series 1996-1" (the "Certificates").
Elections will be made pursuant to this Agreement to treat two segregated pools
within the Trust as REMICs for federal income tax purposes. The Certificates
shall consist of (u) one Class consisting of nine Subclasses of CitiCertificates
(each a "Class A Subclass") designated as "Citicorp Mortgage Securities, Inc.
REMIC Pass-Through Certificates, Series 1996-1, Senior Class A-1
CitiCertificates" (the "Class A-1 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-2 CitiCertificates" (the "Class A-2 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-3 CitiCertificates" (the "Class A-3 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-4 CitiCertificates" (the "Class A-4 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-5 CitiCertificates" (the "Class A-5 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-6 CitiCertificates" (the "Class A-6 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-7 CitiCertificates" (the "Class A-7 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior Class
A-8 CitiCertificates" (the "Class A-8 CitiCertificates"), and "Citicorp Mortgage
Securities, Inc., Inc. REMIC Pass-Through Certificates, Series 1996-1, Senior
Class A-9 CitiCertificates" (the "Class A-9 CitiCertificates") (collectively,
the "Class A CitiCertificates"); (v) one Class of CitiCertificates designated as
"Citicorp Mortgage Securities, Inc., REMIC Pass-Through Certificates, Series
1996-1, Senior Subordinated Class
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M CitiCertificates" (the "Class M CitiCertificates"); (w) one Class consisting
of five Subclasses of CitiCertificates (each a "Class B Subclass") designated as
"Citicorp Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
1996-1, Subordinated Class B-1 CitiCertificates" (the "Class B-1
CitiCertificates"), "Citicorp Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series 1996-1, Subordinated Class B-2 CitiCertificates" (the
"Class B-2 CitiCertificates"), "Citicorp Mortgage Securities, Inc. REMIC
Pass-Through Certificates, Series 1996-1, Subordinated Class B-3
CitiCertificates" (the "Class B-3 CitiCertificates"), "Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1, Subordinated
Class B-4 CitiCertificates" (the "Class B-4 CitiCertificates") and "Citicorp
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1,
Subordinated Class B-5 CitiCertificates" (the "Class B-5 CitiCertificates"),
(collectively, the "Class B CitiCertificates," and together with the Class A and
Class M CitiCertificates, the "CitiCertificates"); (x) one class of certificated
interests designated as "Citicorp Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series 1996-1, Class A-IO Certificates" (the "Class A-IO
Certificates"); (y) one class of uncertificated interests designated as
"Citicorp Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
1996-1, Class L Regular Interest" (the "Class L Regular Interest"), and (z) two
classes of residual interests designated as "Citicorp Mortgage Securities, Inc.
REMIC Pass-Through Certificates, Series 1996-1, Class R Certificate" (the "Class
R Certificate") and "Citicorp Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series 1996-1, Class LR Certificate" (the "Class LR Certificate"
and collectively with the Class R Certificate, the "Residual Certificates").
The Class A-1, Class A-4, Class A-5, Class A-6, Class A-7, Class A-8,
Class A-9, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
CitiCertificates, the Class A-IO Certificates and the Class L Regular Interest
are hereby designated as "regular interests" in the Lower-Tier REMIC and the
Class A-2 and Class A-3 CitiCertificates are hereby designated as "regular
interests" in the Upper-Tier REMIC within the meaning of Code Section
860G(a)(1). The Class LR Certificate is hereby designated as the "residual
interest" in the Lower-Tier REMIC and the Class R Certificate is hereby
designated as the "residual interest" in the Upper-Tier REMIC within the meaning
of Code Section 860G(a)(2). The CitiCertificates, the Class A-IO Certificates,
the Class L Regular Interest and the Residual Certificates shall have the terms
provided for in this Pooling Agreement (including the Standard Terms, as
modified, amended and supplemented hereby).
The Trustee acknowledges that it is holding the Class L Regular
Interest as assets of the Upper-Tier REMIC.
Distributions on the Class M CitiCertificates are subordinated to
distributions on the Class A CitiCertificates and the Class A-IO Certificates,
distributions on the Class B CitiCertificates are subordinated to distributions
on the Class A and Class M CitiCertificates and the Class A-IO Certificates and
distributions on each Subclass of the Class B CitiCertificates are subordinated
to distributions on each Subclass of the Class B CitiCertificates having a lower
numerical designation, in each case to the extent provided in Article XIII.
Section 12.01. General Terms for Certificates .
(a) The Class A CitiCertificates, the Class M CitiCertificates, the
Class B CitiCertificates, the Class A-IO Certificates and the Class L Regular
Interest shall have the following respective Initial Stated Amounts, initial
Notional Amounts, Stated Rates and Last Scheduled Distribution Dates:
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Initial Stated Stated Last Scheduled
Amount Rate Distribution Date(6)
Class A-1 CitiCertificates $112,172,507 7.25% December 25, 2026
Class A-2 CitiCertificates $18,695,417 (1) December 25, 2026
Class A-3 CitiCertificates (2) (3) December 25, 2026
Class A-4 CitiCertificates $13,900,000 7.50% December 25, 2026
Class A-5 CitiCertificates $4,925,000 7.50% December 25, 2026
Class A-6 CitiCertificates $19,338,625 7.50% December 25, 2026
Class A-7 CitiCertificates $ 6,250,000 7.50% December 25, 2026
Class A-8 CitiCertificates $13,387,942 7.50% December 25, 2026
Class A-9 CitiCertificates $381,912.66 (4) December 25, 2026
Class M CitiCertificates $ 4,001,088 7.50% December 25, 2026
Class B-1 CitiCertificates $ 2,500,680 7.50% December 25, 2026
Class B-2 CitiCertificates $ 2,000,544 7.50% December 25, 2026
Class B-3 CitiCertificates $ 1,000,272 7.50% December 25, 2026
Class B-4 CitiCertificates $ 500,136 7.50% December 25, 2026
Class B-5 CitiCertificates $ 1,000,272.38 7.50% December 25, 2026
Class A-IO Certificates 0 (5) December 25, 2026
Class L Regular Interest $18,695,417 7.50% December 25, 2026
(1) The Class A-2 CitiCertificates will accrue interest for the initial LIBOR
Accrual Period at the rate of 5.975% per annum and, for each LIBOR Accrual
Period thereafter, at the per annum rate equal to LIBOR plus 0.60%,
determined monthly as provided herein, subject to a maximum Stated Rate of
9.00% per annum and a minimum Stated Rate of 0.60% per annum.
(2) The Class A-3 CitiCertificates have no Stated Amount. The Class A-3 Notional
Amount on any Distribution Date will be equal to the Class A-2 Stated Amount
on such date, and initially will equal the Initial Stated Amount of the
Class A-2 CitiCertificates.
(3) The Class A-3 CitiCertificates will accrue interest for the
initial LIBOR Accrual Period at the rate of 3.025% per annum and,
for each LIBOR Accrual Period thereafter, at the per annum rate
on the Class A-3 Notional Amount equal to 8.40% minus LIBOR,
determined monthly as provided herein, subject to a minimum
Stated Rate of 0.00%.
(4) The Class A-9 CitiCertificates are principal only regular interests and do
not bear interest.
(5) The Class A-IO Certificates will accrue interest for each Standard Accrual
Period in an amount equal to the Class A-IO Interest Amount.
(6) The last scheduled distribution date is the "latest possible maturity date"
of the related Subclass or Class for purposes of Section 860G(a)(1) of the
Code and Treasury Regulations Section 1.860G-1(a)(4)(iii).
The Residual Certificates will not be issued with Initial Stated
Amounts or Stated Rates, but will be entitled to distributions to the extent set
forth herein.
Interest will accrue with respect to a Distribution Date on the Class
A (other than the Class A-2 and Class A-3), Class M and Class B CitiCertificates
and the Class A-IO Certificates during the related Standard Accrual Period and
on the Class A-2 and Class A-3 CitiCertificates during the related LIBOR Accrual
Period.
The Class A-9 CitiCertificates are principal only CitiCertificates and
do not bear interest.
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(b) Each of the Class A, Class M CitiCertificates and Class B
CitiCertificates and the Class L Regular Interest will bear interest on their
respective Stated Amounts (and, in the case of the Class A-3 CitiCertificates,
on the Class A-3 Notional Amount) at the applicable Stated Rate for such
Subclass or Class set forth or described in Section 12.01(a). Interest accrued
on the CitiCertificates (other than the LIBOR CitiCertificates) and the Class L
Regular Interest during any Standard Accrual Period will be calculated on the
assumption that distributions in reduction of Stated Amount on all
CitiCertificates and the Class L Regular Interest then entitled to such
distributions were made and allocations of any losses were made on the day
immediately following the last day of the preceding Standard Accrual Period, and
not on the following Distribution Date when actually made or allocated. Each
Class A Subclass Interest Amount, each Class B Subclass Interest Amount, the
Class M Interest Amount and the Class A-IO Interest Amount relating to a
Standard or LIBOR Accrual Period shall be distributable on the following
Distribution Date or, if such day is not a Business Day, on the next succeeding
Business Day. Each Subclass and Class of CitiCertificates, the Class A-IO
Certificates and the Class L Regular Interest shall accrue interest from the
applicable Accrual Date for such Subclass and Class of CitiCertificates, the
Class A-IO Certificates and the Class L Regular Interest.
On each Distribution Date, each Class A Subclass Interest Amount and
each Class B Subclass Interest Amount for such Subclass with respect to such
Distribution Date shall be distributable to such Subclass of CitiCertificates,
and the Class A-IO Interest Amount and the Class M Interest Amount with respect
to such Distribution Date shall be distributable to the Class A-IO Certificates
and the Class M CitiCertificates, respectively. In the event that on a
particular Distribution Date the Pool Distribution Amount is insufficient to pay
any of the Class A Subclass Interest Amounts, the Distributable Class A-IO
Interest Amount, the Class M Interest Amount or any of the Class B Subclass
Interest Amounts, the aggregate amount of the shortfall will be carried forward
and added pro rata to the amount distributable to holders of the applicable
Subclass of Class A or Class B CitiCertificates or the Class M CitiCertificates
or the Class A-IO Certificates, as applicable, until distribution thereof is
made as provided herein. On each Distribution Date, interest on each Class L
Regular Interest shall be distributable as provided in Section 13.03.
With respect to any LIBOR Accrual Period commencing on or after the
first Distribution Date, the determination of LIBOR shall be made in accordance
with the following provisions:
(i) On each LIBOR Determination Date, the Trustee will determine
LIBOR on the basis of LIBOR quotations provided by each of the
Reference Banks as of approximately 11:00 a.m. (London time) on the
LIBOR Determination Date in question, as such quotations appear on
the Reuters Screen LIBO Page or the Telerate Page 3750 (each as
defined by reference to the International Swap Dealers Association,
Inc. 1991 ISDA Definitions).
(ii) If, on any LIBOR Determination Date, at least two Reference
Banks provide quotations, LIBOR shall be determined as the
arithmetic mean of such offered quotations (rounded upward, if
necessary, to the nearest multiple of 1/16 of 1%).
(iii) If, on any LIBOR Determination Date, only one or none of
the Reference Banks provides quotations, LIBOR shall be the higher
of:
(x) LIBOR as determined on the previous LIBOR Determination
Date or, in the case of the first LIBOR Determination Date,
5.375%; or
(y) the Reserve Rate. The Reserve Rate shall be the rate
per annum (rounded upward, if necessary, to the nearest
multiple of 1/16 of 1%) that the Trustee determines to be
either (1) the arithmetic mean of the offered quotations
that the leading banks in New York City selected by the
Trustee (after consultation with CMSI) are quoting on the
relevant LIBOR
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Determination Date for one-month United States dollar deposits
to the principal London office of each of the Reference Banks
or those of them (being at least two in number) to which such
offered quotations are, in the opinion of the Trustee, being
so made or (2) in the event that the Trustee can determine no
such arithmetic mean, the arithmetic mean of the offered
quotations that leading banks in New York City selected by the
Trustee (after consultation with CMSI) are quoting on such
LIBOR Determination Date to leading European banks for
one-month United States dollar deposits; provided, however,
that if the banks selected by the Trustee are not quoting as
mentioned above, LIBOR for the next LIBOR Accrual Period shall
be LIBOR as specified in (i) above.
(c) Except as provided below and subject to the provisions of
Section 13.01, on each Distribution Date the Class A Principal Distribution
Amount will be applied to the distribution in reduction of Stated Amount of the
Subclasses of the Class A CitiCertificates in the following order of priority
after giving effect to any reduction of the Stated Amount thereof pursuant to
Section 13.02:
(A) to the Class A-9 CitiCertificates in an amount up to the
Class A PO Principal Amount, until the Stated Amount thereof has been reduced to
zero,
(B) concurrently, (x) an amount up to the Group I Non-PO
Principal Amount shall be allocated:
First, to the Class A-1 and Class A-2 CitiCertificates, pro rata
on the basis of their respective Class A Subclass Stated Amounts until each such
Class A Subclass Stated Amount has been reduced to zero,
Second, to the Class A-4 CitiCertificates until the Stated Amount
thereof has been reduced to zero, and
Third, concurrently, (i)79.9494702223% first to the Class A-7
CitiCertificates until the Stated Amount thereof has been reduced to zero, and
then to the Class A-8 CitiCertificates until the Stated Amount thereof has been
reduced to zero, and (ii) 20.0505297777% to the Class A-5 CitiCertificates until
the Stated Amount has been reduced to zero.
(y) the Group II Non-PO Principal Amount shall be allocated to
the Class A-6 CitiCertificates until the Stated Amount thereof has been reduced
to zero.
(d) On each Distribution Date, Available PO Loss Funds will be
allocated to the Class A-9 CitiCertificates in respect of any Unpaid PO Loss
Amounts.
On any Distribution Date on or after the Subordination Depletion
Date notwithstanding the priorities of Section 12.01(c), funds available for
distribution in reduction of Stated Amount of the Class A CitiCertificates will
be distributed to the Class A CitiCertificates (other than the Class A-9
CitiCertificates), on the one hand, and the Class A-9 CitiCertificates, on the
other, pro rata on the basis of (i) the sum of the Group I Non-PO Principal
Amount and the Group II Non-PO Principal Amount and (ii) the Class A PO
Principal Amount, respectively. On each Distribution Date on and after the
Subordination Depletion Date, the amount allocated to the Class A
CitiCertificates (other than the Class A-9 CitiCertificates) will be allocated
pro rata, based on outstanding Stated Amounts, among such Class A
CitiCertificates notwithstanding the priorities set forth in Section
12.01(c)(B). The amount allocated to each Class A Subclass will be distributed
pro rata among the holders of CitiCertificates of such Class A Subclass.
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On each Distribution Date, subject to the provisions of Section
13.01, a distribution in reduction of the Stated Amount of the Class L Regular
Interest will be made in an amount equal to the distribution in reduction of the
Stated Amount of the Class A-2 CitiCertificates.
On each Distribution Date, subject to the provisions of Section
13.01, distributions in reduction of Stated Amount of the Class M
CitiCertificates and the Subclasses of Class B CitiCertificates will be made in
an aggregate amount equal to the Class M Principal Distribution Amount and the
Class B Principal Distribution Amount, respectively, in accordance with the
priorities set forth in Section 13.01(b).
On each Distribution Date, the Distributable Class A-IO Interest
Amount will be distributed to the Class A-IO Certificates.
Any funds remaining in the Certificate Account on a Distribution
Date after distribution of funds pursuant to Section 3.03(b) shall be
distributed on such Distribution Date in accordance with Section 3.03(c).
Other distributions shall be made in respect of the
CitiCertificates and in respect of the Class L Regular Interest as provided in
Sections 13.01 and 13.03.
The CitiCertificates, the Class A-IO Certificates, the Class L
Regular Interest and the Residual Certificates shall have and be subject to the
following additional specific terms:
Section 12.02. Accrual Date . The Accrual Date is the Cut-Off
Date (in the case of the Class A-IO CitiCertificates and the CitiCertificates
that are not LIBOR CitiCertificates) and the Issue Date (in the case of the
LIBOR CitiCertificates and the Class L Regular Interest).
Section 12.03. Advance Account Trigger Applicability . There is
no Advance Account Trigger Applicability for the CitiCertificates.
Section 12.04. Assumed Reinvestment Rate . There is no Assumed
Reinvestment Rate for the Certificates.
Section 12.05. Authenticating Agent . As of the date hereof, the
Trustee has not appointed an Authenticating Agent. However, the Trustee may at
any time appoint an Authenticating Agent for all of the Certificates pursuant to
Section 8.12. Any such Authenticating Agent may be removed, and any other
Authenticating Agent appointed, as permitted by Section 8.12.
Section 12.06. Available PO Loss Funds . For any Distribution
Date, Available PO Loss Funds shall equal the Pool Distribution Amount for such
Distribution Date minus the sum of (a) the Class A Interest Amount and
Distributable Class A-IO Interest Amount, (b) any amounts in respect of Class A
Unpaid Interest Shortfalls and Class A-IO Unpaid Interest Shortfalls distributed
on such Distribution date, (c) the Class A Principal Distribution Amount, (d)
the Class M Interest Amount, and (e) the sum of the Class B-1 Subclass Interest
Amount, the Class B-2 Subclass Interest Amount, the Class B-3 Subclass Interest
Amount, the Class B-4 Subclass Interest Amount and the Class B-5 Subclass
Interest Amount. For purposes of this Agreement, any Available PO Loss Funds
needed on a Distribution Date to pay any Unpaid PO Loss Amounts will reduce the
amounts otherwise distributable on the Class B Subclasses and the Class M
CitiCertificates in the following order:
First, amounts distributable to the Class B-5, Class B-4, Class B-3,
Class B-2 and Class B-1 CitiCertificates, in that order, in reduction of Stated
Amount; and
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Second, amounts distributable to the Class M CitiCertificates in
reduction of Stated Amount.
Section 12.07. Book-Entry Certificates. Each Subclass of Class A
CitiCertificates (other than the Class A-9 CitiCertificates) are Book-Entry
Certificates.
Section 12.08. Cash Deposited into Certificate Account. There
will be an amount equal to $28,043.13 deposited into the Certificate Account on
the Issue Date to cover interest to accrue on the LIBOR CitiCertificates from
and including the Issue Date to and including December 24, 1996.
Section 12.09. Certificate Registrar. The Bank of New York,
having its principal offices located at 101 Barclay Street, Floor 12W, New York,
NY 10286, Attention: Mortgage Backed and Select Securities Group, is hereby
appointed as the Certificate Registrar for all of the Certificates, pursuant to
Section 6.05. The Bank of New York hereby accepts its appointment as Certificate
Registrar. The Certificate Registrar may be removed and any other Certificate
Registrar appointed as permitted by Section 6.05.
Section 12.10. Class A Optimal Principal Amount. For any
Distribution Date, the sum of the Group I Non-PO Principal Amount, the Group II
Non-PO Principal Amount and the Class A PO Principal Amount, each as of such
Distribution Date.
Section 12.11. Class A Percentage. As to any Distribution Date,
the percentage calculated by dividing the aggregate Class A Subclass Stated
Amounts (other than the Class A-9 CitiCertificates) by the Non-PO Pool Adjusted
Balance, both as of the immediately preceding Distribution Date (after taking
into account distributions in reduction of Stated Amount and allocation of any
losses on such date).
Section 12.12. Class A PO Principal Amount. With respect to any
Distribution Date, an amount equal to the sum of
(i) the applicable PO Percentage of (A) the principal portion of
all Monthly Payments due on the Due Date occurring in the month of
such Distribution Date on each Outstanding Mortgage Loan, less (B)
if the Bankruptcy Coverage Termination Date has occurred, the
principal portion of Debt Service Reductions;
(ii) the applicable PO Percentage of (a) all partial Principal
Prepayments received by the Servicer during the month preceding the
month in which such Distribution Date occurs and (b) the Adjusted
Balance of each Mortgage Loan which was the subject of a Principal
Prepayment in full during the month preceding the month in which
such Distribution Date occurs;
(iii) the applicable PO Percentage of the difference between (1)
the aggregate Net Liquidation Proceeds from each Mortgage Loan which
becomes a Liquidated Loan during the month preceding the month of
such Distribution Date minus any unreimbursed Voluntary Advances in
respect of principal previously made by the Servicer or the Trustee
and (2) the portion of such aggregate Net Liquidation Proceeds
allocable to interest;
(iv) the applicable PO Percentage of the Adjusted Balance of each
Mortgage Loan which was repurchased by CMSI during such preceding
month pursuant to Section 2.03; and
(v) the amount of Reimbursable Class A PO Losses.
Section 12.13. Class A Prepayment Percentage. The Class A
Prepayment Percentage shall be determined as follows: As to any Distribution
Date to and including the Distribution Date in the month in which
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the fifth anniversary of the Issue Date occurs, 100%.As to any Distribution Date
subsequent to such fifth anniversary to and including the Distribution Date in
the month in which the sixth anniversary of the Issue Date occurs, the Class A
Percentage as of such Distribution Date plus 70% of the Subordinated
CitiCertificate Percentage as of such Distribution Date. As to any Distribution
Date subsequent to such sixth anniversary to and including the Distribution Date
in the month in which the seventh anniversary of the Issue Date occurs, the
Class A Percentage as of such Distribution Date plus 60% of the Subordinated
CitiCertificate Percentage as of such Distribution Date. As to any Distribution
Date subsequent to such seventh anniversary to and including the Distribution
Date in the month in which the eighth anniversary of the Issue Date occurs, the
Class A Percentage as of such Distribution Date plus 40% of the Subordinated
CitiCertificate Percentage as of such Distribution Date. As to any Distribution
Date subsequent to such eighth anniversary to and including the Distribution
Date in the month in which the ninth anniversary of the Issue Date occurs, the
Class A Percentage as of such Distribution Date plus 20% of the Subordinated
CitiCertificate Percentage as of such Distribution Date. As to any Distribution
Date subsequent to such ninth anniversary, the Class A Percentage as of such
Distribution Date.
Notwithstanding the foregoing, (i) if the Class A Percentage on any
Distribution Date exceeds the initial Class A Percentage, the Class A Prepayment
Percentage for such Distribution Date will once again equal 100% and (ii)
following the Distribution Date on which the Stated Amount of each of the Group
I Class A CitiCertificates has been reduced to zero (the "Group I Final
Distribution Date"), the Class A Prepayment Percentage will equal (x) if such
Distribution Date occurs prior to January 2000, the Class A Percentage for such
Distribution Date plus 50% of the Subordinated CitiCertificate Percentage for
such Distribution Date, or (y) if such Distribution Date occurs on or after the
Distribution Date in January 2000, the Class A Percentage for such Distribution
Date, provided in each case that the Pro Rata Allocation Test for such
Distribution Date is met. The Pro Rata Allocation Test will not be applicable on
any Distribution Date on or after the Distribution Date in January 2006.
No reduction to the Class A Prepayment Percentage described in the
first paragraph of this definition of Class A Prepayment Percentage shall occur
unless (a) the Servicer certifies to the Trustee, as of the first Distribution
Date as to which any such reduction applies, that (1) the Adjusted Balance of
the Mortgage Loans delinquent 60 days or more (including, for this purpose,
Mortgage Loans in foreclosure and real estate owned by the Trust as a result of
Mortgagor default) averaged over the last six months, as a percentage of the sum
of the Class M Stated Amount and the Class B Stated Amount averaged over the
last six months, is less than 50% and (b) Realized Losses do not exceed (1) with
respect to each Distribution Date from January 2002 through December 2002,
inclusive, 30% of the Original Subordinated Stated Amount, (2) with respect to
each Distribution Date from January 2003 through December 2003, inclusive, 35%
of the Original Subordinated Stated Amount, (3) with respect to each
Distribution Date from January 2004 through December 2004, inclusive, 40% of the
Original Subordinated Stated Amount, (4) with respect to each Distribution Date
from January 2005 through December 2005, inclusive, 45% of the Original
Subordinated Stated Amount, and (5) with respect to the Distribution Date in
January 2006 and thereafter, 50% of the Original Subordinated Stated Amount.
Section 12.14. Class A Principal Distribution Amount. For any
Distribution Date, the lesser of (a) the Class A Optimal Principal Amount and
(b) the Pool Distribution Amount minus the sum of the Class A Interest Amount
and the Distributable Class A-IO Interest Amount and any Class A Unpaid Interest
Shortfalls and any Class A-IO Unpaid Interest Shortfall.
Section 12.15. Class A-IO Interest Amount. On each Distribution
Date, an amount equal to the excess of (a) interest accrued on the Premium
Mortgage Loans over (b) the sum of (x) the product of the Servicing Fee and the
aggregate Adjusted Balance of the Premium Mortgage Loans and (y) the product of
one-twelfth of the aggregate Adjusted Balance of the Premium Mortgage Loans and
7.50%.
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Section 12.16. Class A-3 Notional Amount . The Class A-3 Notional
Amount for any date shall be equal to the Stated Amount of the Class A-2
CitiCertificates on such date. Such notional amount does not entitle the Class
A-3 CitiCertificates to any distributions of principal.
Section 12.17. Class B Percentage. The Class B Percentage for any
Distribution Date shall be equal to (a) the Subordinated CitiCertificate
Percentage minus (b) the Class M Percentage.
Section 12.18. Class B Prepayment Percentage. The Class B
Prepayment Percentage for any Distribution Date will be equal to (a) the
Subordinated Prepayment Percentage minus (b) the Class M Prepayment Percentage.
Section 12.19. Clearing Agency. The initial Clearing Agency will
be The Depository Trust Company.
Section 12.20. Corporate Trust Office . The Corporate Trust
Office is located at The Bank of New York, having its principal offices located
at 101 Barclay Street, Floor 12W, New York, New York 10286, Attention:
Mortgage-Backed & Select Securities Group, or such other address as shall be
identified to CMSI and all Certificateholders by or on behalf of the Trustee in
writing.
Section 12.21. Current Class B-1 Subordination Level. As of any
Distribution Date, the Current Class B-1 Subordination Level is the percentage
obtained by dividing (a) the sum of the Class B-2, Class B-3, Class B-4 and
Class B-5 Subclass Stated Amounts by (b) the Pool Adjusted Balance, each as of
the immediately preceding Distribution Date (after giving effect to any
distributions in reduction of Stated Amount and the allocation of any losses on
such date).
Section 12.22. Current Class B-2 Subordination Level. As of any
Distribution Date, the Current Class B-2 Subordination Level is the percentage
obtained by dividing (a) the sum of the Class B-3, Class B-4 and Class B-5
Subclass Stated Amounts by (b) the Pool Adjusted Balance, each as of the
immediately preceding Distribution Date (after giving effect to any
distributions in reduction of Stated Amount and the allocation of any losses on
such date).
Section 12.23. Current Class B-3 Subordination Level. As of any
Distribution Date, the Current Class B-3 Subordination Level is the percentage
obtained by dividing (a) the sum of the Class B-4 and Class B-5 Subclass Stated
Amounts by (b) the Pool Adjusted Balance, each as of the immediately preceding
Distribution Date (after giving effect to any distributions in reduction of
Stated Amount and the allocation of any losses on such date).
Section 12.24. Current Class B-4 Subordination Level. As of any
Distribution Date, the Current Class B-4 Subordination Level is the percentage
obtained by dividing (a) the Class B-5 Subclass Stated Amount by (b) the Pool
Adjusted Balance, each as of the immediately preceding Distribution Date (after
giving effect to any distributions in reduction of Stated Amount and the
allocation of any losses on such date).
Section 12.25. Current Class M Subordination Level. As of any
Distribution Date, the Current Class M Subordination Level is the percentage
obtained by dividing (a) the Class B Stated Amount by (b) the Pool Adjusted
Balance, each as of the immediately preceding Distribution Date (after giving
effect to any distributions in reduction of Stated Amount and the allocation of
any losses on such date).
Section 12.26.Cut-Off Date. The Cut-Off Date is December 1, 1996.
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Section 12.27. Definitive Certificates . The Class A-9, Class M
and Class B CitiCertificates, Class A-IO Certificates and Residual Certificates
will be issued in fully registered certificated form.
Section 12.28. Denominations. The denominations of each Subclass
of the Class A CitiCertificates (other than the Class A-3 CitiCertificates),
Class M, Class B-1 and Class B-2 CitiCertificates are $1,000 Initial Stated
Amount and any whole dollar amount in excess thereof and the Class B-3, Class
B-4 and Class B-5 CitiCertificates are $100,000 Initial Stated Amount and
integral multiples of $1,000 in excess thereof (except that one Class A-9
CitiCertificate and one Class B-3, Class B-4 and Class B-5 CitiCertificate may
be issued in a different denomination). The denominations of the Class A-3
CitiCertificates will be an initial notional amount of $1,000 and any whole
dollar amount in excess thereof. The denominations of the Class A-IO
Certificates are 25 Single Certificates and any whole or fractional Single
Certificate in excess thereof. The denominations of the Class R and Class LR
Certificates are 100% Percentage Interest.
Section 12.29. Deposit Date. The Deposit Date with respect to the
Certificates is the Business Day prior to each Distribution Date.
Section 12.30. Depository. The initial Depository is Citibank
(New York State).
Section 12.31. Designated Interest Accrual Date. The Designated
Interest Accrual Date shall be (a) the last day of the calendar month preceding
each Distribution Date in the case of the CitiCertificates that are not LIBOR
CitiCertificates and the Class A-IO Certificates and (b) the day immediately
preceding each Distribution Date in the case of the LIBOR CitiCertificates and
the Class L Regular Interest.
Section 12.32. Determination Date. The Determination Date with
respect to each Distribution Date is the close of business on the 18th day (or,
if such day is not a Business Day, the preceding Business Day) of the month in
which the related Distribution Date occurs.
Section 12.33. Discount Mortgage Loan. Each Mortgage Loan having
a Net Note Rate of less than 7.50% per annum.
Section 12.34. Distributable Class A-IO Interest Amount. For any
Distribution Date, the Class A-IO Interest Amount minus (x) the Class A-IO
Prepayment Interest Shortfall Amount and minus (y) the Class A-IO Certificates
pro rata share of the interest portion of Excess Special Hazard Losses, Excess
Fraud Losses and Excess Bankruptcy Losses.
Section 12.35. Distribution Date. Each Distribution Date shall
be the 25th day of each month, commencing in January 1997 (or if such day is not
a Business Day, the next succeeding Business Day).
Section 12.36. Group I Class A CitiCertificates. The Class A-1,
Class A-2, Class A-4, Class A-5, Class A-7 and Class A-8 CitiCertificates will
compromise the Group I Class A CitiCertificates.
Section 12.37. Group I Final Distribution Date. The Distribution
Date on which the Stated Amounts of each Class of the Group I Class A
CitiCertificates has been reduced to zero.
Section 12.38. Group I Non-PO Principal Amount. With respect to
any Distribution Date, an amount equal to the sum of
(i) the Group I Percentage of the applicable Non-PO Percentage of
(A) the principal portion of all Monthly Payments due on the Due
Date occurring in the month of such Distribution Date
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on each Outstanding Mortgage Loan,less (B)if the Bankruptcy Coverage
Termination Date has occurred, the principal portion of Debt Service
Reductions;
(ii) the Group I Prepayment Percentage of the applicable Non-PO
Percentage of (a) all Partial Prepayments received by the Servicer
during the month preceding the month in which such Distribution Date
occurs and (b) the Adjusted Balance of each Mortgage Loan which was
the subject of a Principal Prepayment in full during the month
preceding the month in which such Distribution Date occurs;
(iii) the Group I Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net
Liquidation Proceeds from each Mortgage Loan which becomes a
Liquidated Loan during the month preceding the month of such
Distribution Date minus any unreimbursed Voluntary Advances in
respect of principal previously made by the Servicer or the Trustee
and (2) the portion of such aggregate Net Liquidation Proceeds
allocable to interest;
(iv) the Group I Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was
repurchased by CMSI during such preceding month pursuant to Section
2.03; and
(v) the Group I Reimbursement Percentage of the amount of
Reimbursable Class A Non-PO Losses.
Section 12.39. Group I Percentage. The "Group I Percentage" on
any Distribution Date will equal the percentage obtained by dividing the
aggregate Stated Amounts of all the Group I Class A CitiCertificates by the
aggregate Non-PO Adjusted Balance, both as of the immediately preceding
Distribution Date (after taking into account distributions in reduction of
Stated Amount and allocation of any losses on such date).
Section 12.40. Group I Prepayment Percentage. The "Group I
Prepayment Percentage" on any Distribution Date occurring during the periods set
forth below will be as follows:
- ---------------------------------- ---------------------------------------------
Period (dates inclusive) Group I Prepayment Percentage
- ---------------------------------- ---------------------------------------------
January 1997 - December 2001 100%
- ---------------------------------- ---------------------------------------------
January 2002- December 2002 Group I Percentage plus 70% of the sum of the
Group II Percentage and the Subordinated
CitiCertificate Percentage
- ---------------------------------- ---------------------------------------------
January 2003 - December 2003 Group I Percentage plus 60% of the sum of the
Group II Percentage and the Subordinated
CitiCertificate Percentage
- ---------------------------------- ---------------------------------------------
January 2004 - December 2004 Group I Percentage plus 40% of the sum of the
Group II Percentage and the Subordinated
CitiCertificate Percentage
- ---------------------------------- ---------------------------------------------
January 2005 - December 2005 Group I Percentage plus 20% of the sum of the
Group II Percentage and the Subordinated
CitiCertificate Percentage
- ---------------------------------- ---------------------------------------------
January 2006 - and thereafter Group I Percentage;
- ---------------------------------- ---------------------------------------------
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provided, that if on the Group I Final Distribution Date the amount available
for distribution in respect of the Group I Class A CitiCertificates would
otherwise exceed the remaining aggregate Stated Amount of the Group I Class A
CitiCertificates, (1) the Group I Prepayment Percentage on such date will be
limited to the percentage necessary to reduce the Stated Amounts of the Group
I Class A CitiCertificates to zero, and (2) any amounts that would have been
allocable to the Group I Class A CitiCertificates absent the limitation in
clause (1) above will be distributable to the Class A-6 CitiCertificates,
provided that if the Pro Rata Allocation Test is met on such date, such
amounts will be distributable to the Class A-6 CitiCertificates and to the
Subordinated CitiCertificates, as a group, as follows: (x) if such
Distribution Date occurs prior to January 2000, in such proportion that the
Subordinated CitiCertificates, as a group, receive 50% of their pro rata
share of such amounts and the Class A-6 CitiCertificates receive the
remainder, and (y) if such Distribution Date occurs on or after the
Distribution Date in January 2000, pro rata, on the basis of the aggregate
Stated Amount of the Class A-6 CitiCertificates and the aggregate Stated
Amount of the Subordinated CitiCertificates (subject, in each case, to the
preferential right of the Class A-6 CitiCertificates to receive distributions
on such Distribution Date). The Pro Rata Allocation Test will not be
applicable on any Distribution Date on or after the Distribution Date in
January 2006. The Group I Prepayment Percentage on any Distribution Date
after the Group I Final Distribution Date will be zero.
Section 12.41. Group I Reimbursement Percentage. For any
Distribution Date, a percentage equal to the ratio of (a) Realized Losses
allocated to the Group I Class A CitiCertificates to (b) Realized Losses
allocated to the Class A CitiCertificates (other than the Class A-9
CitiCertificates), in each case net of all reimbursements thereof on prior
Distribution Dates.
Section 12.42. Group II Non-PO Principal Amount. With respect to
any Distribution Date, an amount equal to the sum of
(i) the Group II Percentage of the applicable Non-PO
Percentage of (A) the principal portion of all Monthly
Payments due on the Due Date occurring in the month of such
Distribution Date on each Outstanding Mortgage Loan, less
(B) if the Bankruptcy Coverage Termination Date has
occurred, the principal portion of Debt Service Reductions;
(ii) the Group II Prepayment Percentage of the applicable
Non-PO Percentage of (a) all Partial Prepayments received by
the Servicer during the month preceding the month in which
such Distribution Date occurs and (b) the Adjusted Balance
of each Mortgage Loan which was the subject of a Principal
Prepayment in full during the month preceding the month in
which such Distribution Date occurs;
(iii) the Group II Prepayment Percentage of the
applicable Non-PO Percentage of the difference between (1)
the aggregate Net Liquidation Proceeds from each Mortgage
Loan which becomes a Liquidated Loan during the month
preceding the month of such Distribution Date minus any
unreimbursed Voluntary Advances in respect of principal
previously made by the Servicer or the Trustee and (2) the
portion of such aggregate Net Liquidation Proceeds allocable
to interest;
(iv) the Group II Prepayment Percentage of the applicable
Non-PO Percentage of the Adjusted Balance of each Mortgage
Loan which was repurchased by CMSI during such preceding
month pursuant to Section 2.03; and
(v) the Group II Reimbursement Percentage of the amount
of Reimbursable Class A Non-PO Losses.
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Section 12.43. Group II Percentage. The "Group II Percentage" on
any Distribution Date will equal the Class A Percentage minus the Group I
Percentage for such Distribution Date.
Section 12.44. Group II Prepayment Percentage. The "Group II
Prepayment Percentage" on any Distribution Date will equal the Class A
Prepayment Percentage minus the Group I Prepayment Percentage (without regard to
clause (1) in the proviso to the definition of Group I Prepayment Percentage)
for such Distribution Date, except that on any Distribution Date after the Group
I Final Distribution Date, the Group II Prepayment Percentage will equal the
Class A Prepayment Percentage.
Section 12.45. Group II Reimbursement Percentage. For any
Distribution Date, 100% minus the Group I Reimbursement Percentage for such
Distribution Date.
Section 12.46. Initial Bankruptcy Loss Amount. The Initial
Bankruptcy Loss Amount is $100,000.
Section 12.47. Initial Fraud Loss Amount. The Initial Fraud Loss
Amount is $4,001,087.92.
Section 12.48. Initial Special Hazard Loss Amount. The Initial
Special Hazard Loss Amount is $2,000,543.96.
Section 12.49. Initial Special Hazard Percentage . The Initial
Special Hazard Percentage is 1.00%.
Section 12.50. Initial Stated Amount . The Initial Stated Amount
for each Subclass of the Class A CitiCertificates (or, in the case of the Class
A-3 CitiCertificates, the initial notional amount thereof), for the Class M
CitiCertificates and for each Subclass of the Class B CitiCertificates and the
Class L Regular Interest is as set forth in Section 12.01(a).
Section 12.51. Investment Account . The Certificate Account will
be an Investment Account.
Section 12.52. Investor Rate. For the purposes of Section 9.01,
the Investor Rate for each Mortgage Loan will be applicable Net Note Rate
therefor.
Section 12.53. Issue Date . The Issue Date is December 19, 1996.
Section 12.54. Last Scheduled Distribution Date . The Last
Scheduled Distribution Dates for the CitiCertificates, the Class A-IO
Certificates and the Class L Regular Interest as set forth in Section 12.01(a).
Section 12.55. LIBOR. LIBOR is the arithmetic mean of London
interbank offered quotations for one-month Eurodollar deposits.
Section 12.56. LIBOR Accrual Period . The LIBOR Accrual Period
in respect of any Distribution Date is the period from the 25th day of the month
preceding the month of such Distribution Date (or from December 19, 1996, in the
case of the first Distribution Date) through the 24th day of the month of such
Distribution Date.
Section 12.57. LIBOR CitiCertificates. The Class A-2 and Class
A-3 CitiCertificates are LIBOR CitiCertificates.
Section 12.58. LIBOR Determination Date. The LIBOR Determination
Date in respect of any
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LIBOR Accrual Period is the second business day on which banks in London and New
York City are open for the transaction of international business prior to the
Distribution Date on which such LIBOR Accrual Period commences.
Section 12.59. Lower-Tier Classes . The Lower-Tier Classes shall
consist of the Class A-1, Class A-4, Class A-5, Class A-6, Class A-7, Class A-8,
Class A-9, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
CitiCertificates, the Class A-IO Certificates, the Class L Regular Interest and
the Class LR Certificate.
Section 12.60. Lower-Tier REMIC. The Lower-Tier REMIC is one of
the two separate REMICs comprising the Trust Fund, the assets of which consist
of the Mortgage Loans, such amounts as shall from time to time be held in the
Certificate Account, the insurance policies, if any, relating to a Mortgage
Loan, and property which secured a Mortgage Loan and which has been acquired by
foreclosure or deed in lieu of foreclosure and all proceeds thereof.
Section 12.61. Mortgage Document Custodian. The initial Mortgage
Document Custodian is Mercantile Bank of St. Louis N.A.
Section 12.62. Mortgage Loans . The Mortgage Loans will consist
primarily of 20- to 30-year fixed-rate conventional one- to four-family mortgage
loans.
Section 12.63. Mortgage Note Custodian . Mercantile Bank of St.
Louis N.A. is the initial Mortgage Note Custodian. At any time that the Rating
Agencies respective rating of Citicorp's long-term senior debt is below the
respective rating assigned by each such Rating Agency to the CitiCertificates,
the Mortgage Note Custodian may not be an Affiliate of CMSI.
Section 12.64. Net Note Rate . For a Mortgage Loan, the related
Mortgage Note Rate less the Servicing Fee.
Section 12.65. Non-PO Percentage . For any Mortgage Loan, the
difference between (a) 100% and (b) the applicable PO Percentage.
Section 12.66. Notices . The address of the Trustee to which
notices should be sent is The Bank of New York, having its principal offices
located at 101 Barclay Street, Floor 12W, New York, New York 10268, Attention:
Mortgage-Backed & Select Securities Group, or such other address of which the
Trustee shall notify CMSI in writing. The address of CMSI to which notices
should be sent is Citicorp Mortgage Securities, Inc., 909 Third Avenue, 30th
Floor, New York, NY 10043, Attention: Andrew E. LaBarbera, or such other address
of which CMSI shall notify the Trustee in writing. The address of S&P to which
notices should be sent is 25 Broadway, New York, NY 10004. The address of Fitch
to which notices should be sent is Residential Mortgage Pass-Through Monitoring,
Fitch Investors Service, L.P., One State Street Plaza, 32nd Floor, New York, New
York 10004.
Section 12.67. Original Class A Percentage . The Original Class
A Percentage is 94.499999701181%.
Section 12.68. Original Class A Stated Amount . The Original
Class A Stated Amount is $189,051,403.66.
Section 12.69. Original Class B-1 Percentage . The Original
Class B-1 Percentage is 1.250000024743%.
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<PAGE>
Section 12.70. Original Class B-1 Stated Amount . The Original
Class B-1 Stated Amount is $2,500,680.00.
Section 12.71. Original Class B-1 Subordination Level . The
Original Class B-1 Subordination Level is equal to 2.250000234487%.
Section 12.72. Original Class B-2 Percentage . The Original
Class B-2 Percentage is 1.000000019795%
Section 12.73. Original Class B-2 Stated Amount . The Original
Class B-2 Stated Amount is $2,000,544.00.
Section 12.74. Original Class B-2 Subordination Level . The
Original Class B-2 Subordination Level is equal to 1.250000214692%.
Section 12.75. Original Class B-3 Percentage . The Original
Class B-3 Percentage is 0.500000009897%.
Section 12.76. Original Class B-3 Stated Amount . The Original
Class B-3 Stated Amount is $1,000,272.00.
Section 12.77. Original Class B-3 Subordination Level . The
Original Class B-3 Subordination Level is equal to 0.750000204795%.
Section 12.78. Original Class B-4 Percentage . The Original
Class B-4 Percentage is 0.250000004949%.
Section 12.79. Original Class B-4 Stated Amount . The Original
Class B-4 Stated Amount is $500,136.00.
Section 12.80. Original Class B-4 Subordination Level . The
Original Class B-4 Subordination Level is equal to 0.500000199846%.
Section 12.81. Original Class B-5 Percentage. The Original Class
B-5 Percentage is 0.500000199846%.
Section 12.82. Original Class B-5 Stated Amount . The Original
Class B-5 Stated Amount is $1,000,272.38.
Section 12.83. Original Class M Percentage . The Original Class
M Percentage is 2.000000039589%.
Section 12.84. Original Class M Stated Amount . The Original
Class M Stated Amount is $4,001,088.00.
Section 12.85. Original Class M Subordination Level. The
Original Class M Subordination Level is equal to 3.500000259230%.
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Section 12.86. Original Subordinated Stated Amount . The
Original Subordinated Stated Amount is the sum of the Original Class M, Class
B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Stated Amounts. The Original
Subordinated Stated Amount is equal to $11,002,992.38.
Section 12.87. Participant . A participating organization in the
Clearing Agency.
Section 12.88. Paying Agent . The Trustee shall act as the
initial Paying Agent. However, the Servicer may at any time appoint a Paying
Agent for all of the Certificates. Any such Paying Agent may be removed, and any
other Paying Agent appointed.
Section 12.89. PO Loss Amount. With respect to each Distribution
Date, the sum of (i) the difference, if any, between the Class A PO Principal
Amount for such Distribution Date and the amount distributed in reduction of the
Stated Amount of the Class A-9 CitiCertificates on such Distribution Date
pursuant to Paragraph third of Section 13.01(b) and (ii) the PO Percentage of
each Realized Loss (other than Excess Special Hazard Losses, Excess Fraud Losses
and Excess Bankruptcy Losses).
Section 12.90. PO Percentage. A fraction, expressed as a
percentage, (a) for each Discount Mortgage Loan, the numerator of which is 7.50%
minus the Net Note Rate and the denominator of which is 7.50% and (b) for each
Premium Mortgage Loan, 0.0%.
Section 12.91. Premium Mortgage Loan. Each Mortgage Loan having
a Net Note Rate of 7.50% per annum or greater.
Section 12.92. Pro Rata Allocation Test. The "Pro Rata
Allocation Test" will be satisfied on any Distribution Date if all of the
following conditions are satisfied: (i) the Subordinated CitiCertificate
Percentage on such Distribution Date is at least double the Subordinated
CitiCertificate Percentage on the Closing Date, (ii) the aggregate Adjusted
Balance of Mortgage Loans delinquent 60 days or more (including, for this
purpose, Mortgage Loans in foreclosure and real estate owned by the Trust as a
result of Mortgagor default) averaged over the last six months, as a percentage
of the sum of the Class M Stated Amount and the Class B Stated Amount averaged
over the last six months, is less than 50% and (iii) cumulative Realized Losses
do not exceed 30% of the Original Subordinated Stated Amount.
Section 12.93. Rating Agencies . The Rating Agencies for the
Class A CitiCertificates are S&P and Fitch, and for the Class M and Class B
CitiCertificates, Fitch.
Section 12.94. Record Date . The Record Date for each
Distribution Date will be the close of business (a) on the last day of the month
preceding the month of the applicable Distribution Date in the case of
CitiCertificates that are not LIBOR CitiCertificates and (b) on the 15th day of
the month of the applicable Distribution Date in the case of the LIBOR
CitiCertificates.
Section 12.95. Reference Banks. Each Reference Bank (i) shall be
a leading bank engaged in transactions in Eurodollar deposits in the
International Eurocurrency Market; (ii) shall not control, be controlled by, or
be under common control with CMSI; and (iii) shall have an established place of
business in London. If any such Reference Bank should be unwilling or unable to
act as such or if CMSI should terminate the appointment of any such Reference
Bank, CMSI will promptly appoint another leading bank meeting the criteria
specified above and notify the Trustee in writing of such appointment. The
initial Reference Banks shall be Barclays PLC, Bankers Trust Company and The
Bank of Tokyo, Ltd.
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Section 12.96. Right to Repurchase . The right of CMSI to
repurchase all of the Mortgage Loans pursuant to Section 9.01 hereof shall be
conditioned upon, among other things, the aggregate Adjusted Balance of such
Mortgage Loans being less than $10,002,719.80 at the time of any such
repurchase.
Section 12.97. Servicing Fee . The Servicing Fee is a monthly
fee equal to 0.25% per annum of the aggregate Adjusted Balance of each Mortgage
Loan as of the close of business on the first day of the month next preceding
the month in which the related Distribution Date occurs, payable to the Servicer
out of each payment received by it on account of interest on such Mortgage Loan
during the related Due Period, to the extent that the amount of such payment of
interest exceeds the amount of interest with respect to such Mortgage Loan to be
deposited in the Certificate Account.
Section 12.98. Single Certificate . A Single Certificate
evidences, in the case of a Class A-1, Class A-2, Class A-4, Class A-5, Class
A-6, Class A-7 and Class A-8 CitiCertificates, $1.00 Initial Stated Amount, in
the case of a Class A-3 CitiCertificates, $1.00 initial notional amount, in the
case of a Class A-9 CitiCertificate, a Class M CitiCertificate or a Class B
CitiCertificate, $1,000 Initial Stated Amount, in the case of a Class A-IO
Certificate, a 1% undivided interest and, in the case of a Residual Certificate,
1% Percentage Interest.
Section 12.99. Spread Percentage . The Spread Percentage shall
be 0%.
Section 12.99A. Standard Accrual Period. The Standard Accrual
Period in respect of any Distribution Date is the first day of the month
preceding the month of such Distribution Date (or, in the case of the first
Distribution Date, the Cut-Off Date) through the last day of the month preceding
the month of such Distribution Date.
Section 12.99B. Startup Day . The Startup Day will be December
19, 1996.
Section 12.99C. Stated Rate . The Stated Rate for the
CitiCertificates is as set forth or described in Section 12.01(a).
Section 12.99D. Trustee Advances . The Trustee (in its
individual capacity) hereby undertakes to make Trustee Advances in accordance
with Section 8.13.
Section 12.99E. Unpaid PO Loss Amount. For any Distribution
Date, the difference between (a) the sum of the PO Loss Amount for that and
prior Distribution Dates and (b) amounts distributed to the Class A-9
CitiCertificates pursuant to Paragraph fourth of Section 13.01(b).
Section 12.99F. Upper-Tier Certificates . The Upper-Tier
Certificates shall consist of the Class A-2 and Class A-3 CitiCertificates and
the Class R Certificate.
Section 12.99G. Upper-Tier REMIC. The Upper-Tier REMIC is one of
the two separate REMICs comprising the Trust Fund, the assets of which consist
of the Class L Regular Interest and such amounts as shall from time to time be
held in the Upper-Tier REMIC Account.
Section 12.99H. Wire Transfer Eligibility . The minimum number
of Single Certificates eligible for wire transfer on each Distribution Date, in
the case of CitiCertificates, is 1,000,000 (representing a $1,000,000 Initial
Stated Amount or initial notional amount) and, in the case of each Class of
Residual Certificates, a 100% Percentage Interest.
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Section 12.99I. REMIC-Related Covenants . For as long as the
Trust Fund shall exist, CMSI and the Trustee shall act in accordance herewith to
assure continuing treatment of the Trust Fund for federal income tax purposes as
two segregated asset pools, and the treatment of each such segregated asset pool
as a REMIC and to avoid the imposition of tax on the Trust Fund, the Upper-Tier
REMIC or the Lower-Tier REMIC.
(a) CMSI shall maintain books with respect to each such REMIC on
a calendar year taxable year and on the accrual method of accounting.
(b) The Trustee shall not create, or permit the creation of, any
"interests" in either REMIC within the meaning of Code Section 860D(a)(2) other
than the interests represented by the Certificates, and (with respect to the
Lower-Tier REMIC) the Class L Regular Interest.
(c) Except as otherwise provided in the Code, CMSI shall not
grant, and the Trustee shall not accept, property unless (i) substantially all
of the property held by each such REMIC constitutes either "qualified mortgages"
or "permitted investments" as defined in Code Sections 860G(a)(3) and (5),
respectively, and (ii) no property shall be granted to either REMIC after the
Startup Day, unless such grant would not subject either REMIC to the 100% tax on
contributions to a REMIC after the Startup Day imposed by Code Section 860G(d).
(d) The Trustee shall not accept on behalf of the Trust Fund or
either of the Upper-Tier REMIC or the Lower-Tier REMIC any fee or other
compensation for services and shall not accept on behalf of the Trust Fund any
income from assets other than those permitted to be held by a REMIC.
(e) The Trustee shall not sell or permit the sale of all or any
portion of the Mortgage Loans, or of an Eligible Investment held in the
Certificate Account or the Upper-Tier REMIC Account (other than in accordance
with Sections 2.02, 2.03, 2.04 and 3.02(d)) unless such sale is pursuant to a
"qualified liquidation" as defined in Code Section 860F(a)(4)(A) and is in
accordance with Section 9.01 and Section 12.96.
Section 12.99J. Expenses and Liabilities of the Trust Fund .
CMSI, as Servicer, shall be liable for all expenses, liabilities and obligations
of the Trust Fund (other than the obligation to make distributions in reduction
of Stated Amount of the CitiCertificates and the Class L Regular Interest, the
obligation to make distributions of interest on the CitiCertificates and the
Class L Regular Interest and the obligation to make distributions to the Class
A-IO Certificates) including those set forth in Section 8.05 hereof. To the
extent such expenses, liabilities or obligations consist of federal income
taxes, including, without limitation, prohibited transaction taxes, taxes on net
income from foreclosure property and taxes on certain contributions to a REMIC
after the Startup Day, nothing shall prevent the Servicer from contesting any
such tax, if permitted by law, pending the outcome of such proceedings. If the
Trustee determines that on any Distribution Date the amount in the Certificate
Account due CMSI as its Servicing Fee, after the distribution of all amounts
required to be distributed to the Holders of the Certificates has been made, is
insufficient to pay expenses or meet any obligation of the Trust Fund, the
Trustee shall give notice of any shortfall to CMSI setting forth the basis for
such expenses. Within ten Business Days of such notice, CMSI shall deliver to
the Trustee immediately available funds in the amount of such expenses.
Section 12.99K. Tax Matters Person . If in any taxable year
there shall be more than one Holder of the Class LR or Class R Certificates, a
tax matters person may be designated with respect to the Lower-Tier REMIC or
Upper-Tier REMIC, respectively, who shall have the same duties with respect to
the respective REMIC as those of a "tax matters partner" under Subchapter C of
Chapter 63 of Subtitle F of the Code, and who shall be, in order of priority,
(i) the Servicer or an Affiliate of the Servicer, if the Servicer or such
Affiliate is the Holder of a Class LR or Class R Certificate, as the case may
be, at any time during the taxable year or at the time such designation is made,
(ii) if the Servicer is not a Holder of a Class LR or Class R Certificate at the
relevant
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time, the Servicer as agent for the Holders of the Class LR or Class R
Certificates, if such designation is permitted to be made under the Code or
(iii) such Holder of a Class LR or Class R Certificate or person who may be
designated a tax matters person in the same manner in which a tax matters
partner may be designated under applicable Treasury Regulations, including
Treasury Regulations ss. 1.860F-4(d) and temporary Treasury Regulations ss.
301.6231(a)(7)-1T.
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ARTICLE XIII
SUBORDINATION; PRIORITIES; ALLOCATION OF LOSSES
Section 13.01. Subordination; Priority of Distributions.
(a) The rights of the holders of the Class M CitiCertificates to
receive distributions in respect thereof on any Distribution Date shall be
subordinated to the rights of the Class A CitiCertificateholders and the Class
A-IO Certificateholders to receive distributions (and to distributions on the
Class L Regular Interest) to the extent, and only to the extent, described
herein. The rights of the holders of any Class B Subclass to receive
distributions in respect of such Class B Subclass on any Distribution Date shall
be subordinated to the rights of the Class A and Class M CitiCertificateholders,
the Class A-IO Certificateholders and the holders of each Class B Subclass
having a lower numerical designation to receive distributions (and to
distributions on the Class L Regular Interest) to the extent, and only to the
extent, described herein. The right of CMSI to receive its Servicing Fee shall
not be subordinated to the rights of the Class A or Class M
CitiCertificateholders, the Class A-IO Certificateholders or the Class B
CitiCertificateholders.
(b) On each Distribution Date, the Pool Distribution Amount will
be applied in the following amounts, to the extent the Pool Distribution Amount
is sufficient therefor, in the manner and in the order of priority as follows:
first, to the Subclasses of Class A CitiCertificates and to the
Class A-IO Certificates, pro rata, based upon their respective Class A Subclass
Interest Amounts and the Distributable Class A-IO Interest Amount, in an
aggregate amount up to the Class A Interest Amount plus the Distributable Class
A-IO Interest Amount;
second, to the Subclasses of Class A CitiCertificates and the
Class A-IO Certificates, pro rata, based upon their respective Class A Subclass
Interest Shortfall Amounts and the Class A-IO Unpaid Interest Shortfall, in an
aggregate amount up to the Class A Unpaid Interest Shortfall plus the Class A-IO
Unpaid Interest Shortfall;
third, to the Subclasses of Class A CitiCertificates, in an
aggregate amount up to the Class A Principal Distribution Amount, such
distribution to be allocated among such Subclasses in accordance with Section
12.01(c) or Section 13.01(c), as applicable;
fourth, to the Class A-9 CitiCertificates, in an aggregate
amount equal to the lesser of (a) Available PO Loss Funds and (b) any Unpaid PO
Loss Amounts;
fifth, to the Class M CitiCertificates in an amount up to the
Class M Interest Amount;
sixth, to the Class M CitiCertificates in an amount up to the
Class M Unpaid Interest Shortfall Amount;
seventh, to the Class M CitiCertificates in an amount up to the
Class M Optimal Principal Amount less any amount applied to payment of any
Unpaid PO Loss Amount;
eighth, to the Class B-1 CitiCertificates in an amount up to
their Class B Subclass Interest Amount;
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ninth, to the Class B-1 CitiCertificates in an amount up to the
Class B-1 Unpaid Interest Shortfall Amount;
tenth, to the Class B-1 CitiCertificates in an amount up to the
Class B-1 Optimal Principal Amount less any amount applied to payment of any
Unpaid PO Loss Amount;
eleventh, to the Class B-2 CitiCertificates in an amount up to
their Class B Subclass Interest Amount;
twelfth, to the Class B-2 CitiCertificates in an amount up to
the Class B-2 Unpaid Interest Shortfall;
thirteenth, to the Class B-2 CitiCertificates in an amount up to
the Class B-2 Optimal Principal Amount less any amount applied to payment of any
Unpaid PO Loss Amount;
fourteenth, to the Class B-3 CitiCertificates in an amount up to
their Class B Subclass Interest Amount;
fifteenth, to the Class B-3 CitiCertificates in an amount up to
the Class B-3 Unpaid Interest Shortfall;
sixteenth, to the Class B-3 CitiCertificates in an amount up to
the Class B-3 Optimal Principal Amount less any amount applied to payment of any
Unpaid PO Loss Amount;
seventeenth, to the Class B-4 CitiCertificates in an amount up
to their Class B Subclass Interest Amount;
eighteenth, to the Class B-4 CitiCertificates in an amount up to
the Class B-4 Unpaid Interest Shortfall;
nineteenth, to the Class B-4 CitiCertificates in an amount up to
the Class B-4 Optimal Principal Amount less any amount applied to payment of any
Unpaid PO Loss Amount;
twentieth, to the Class B-5 CitiCertificates in an amount up to
their Class B Subclass Interest Amount;
twenty-first, to the Class B-5 CitiCertificates in an amount up
to the Class B-5 Unpaid Interest Shortfalls;
twenty-second, to the Class B-5 CitiCertificates in an amount up
to the Class B-5 Optimal Principal Amount less any amount applied to payment of
any Unpaid PO Loss Amount; and
twenty-third, to the Holder of the Class LR Certificate.
(c) On each Distribution Date occurring on or subsequent to the
Subordination Depletion Date, the Class A Principal Distribution Amount shall be
distributed among the Subclasses of Class A CitiCertificates as set forth in
Section 12.01(d) and the Class A Interest Amount shall be distributed among the
Class A Subclasses pro rata in accordance with their respective Class A Subclass
Interest Amounts.
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(d) (i) if on any Distribution Date the Current Class M
Subordination Level is less than the Original Class M Subordination Level, then
the Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5 CitiCertificates
shall not be eligible to receive any distributions in reduction of Stated Amount
and the Class B-1 Percentage, Class B-2 Percentage, the Class B-3 Percentage,
the Class B-4 Percentage, the Class B-5 Percentage, the Class B-1 Prepayment
Percentage, the Class B-2 Prepayment Percentage, the Class B-3 Prepayment
Percentage, the Class B-4 Prepayment Percentage and the Class B-5 Prepayment
Percentage shall each be equal to zero with respect to such Distribution Date;
(ii) if on any Distribution Date the Current Class B-1
Subordination Level is less than the Original Class B-1 Subordination Level,
then the Class B-2, Class B-3, Class B-4 and Class B-5 CitiCertificates shall
not be eligible to receive distributions in reduction of Stated Amount and the
Class B-2 Percentage, the Class B-3 Percentage, the Class B-4 Percentage, the
Class B-5 Percentage, the Class B-2 Prepayment Percentage, the Class B-3
Prepayment Percentage, the Class B-4 Prepayment Percentage and the Class B-5
Prepayment Percentage shall each be equal to zero with respect to such
Distribution Date;
(iii) if on any Distribution Date the Current Class B-2
Subordination Level is less than the Original Class B-2 Subordination Level,
then the Class B-3, Class B-4 and Class B-5 CitiCertificates shall not be
eligible to receive distributions in reduction of Stated Amount and the Class
B-3 Percentage, the Class B-4 Percentage, the Class B-5 Percentage, the Class
B-3 Prepayment Percentage, the Class B-4 Prepayment Percentage and the Class B-5
Prepayment Percentage shall each be equal to zero with respect to such
Distribution Date;
(iv) if on any Distribution Date the Current Class B-3
Subordination Level is less than the Original Class B-3 Subordination Level,
then the Class B-4 and Class B-5 CitiCertificates shall not be eligible to
receive distributions in reduction of Stated Amount and the Class B-4
Percentage, the Class B-5 Percentage, the Class B-4 Prepayment Percentage and
the Class B-5 Prepayment Percentage shall each be equal to zero with respect to
such Distribution Date; and
(v) if on any Distribution Date the Current Class B-4
Subordination Level is less than the Original Class B-4 Subordination Level,
then the Class B-5 CitiCertificates shall not be eligible to receive
distributions in reduction of Stated Amount and the Class B-5 Percentage and the
Class B-5 Prepayment Percentage shall each be equal to zero with respect to such
Distribution Date.
(f) No Class A Subclass Interest Shortfall, Class A Unpaid
Interest Shortfall, Unpaid PO Loss Amount, Class A-IO Unpaid Interest Shortfall,
Class M Unpaid Interest Shortfall, Class B-1, Class B-2, Class B-3, Class B-4 or
Class B-5 Interest Shortfall or Class B-1, Class B-2, Class B-3, Class B-4 or
Class B-5 Unpaid Interest Shortfall will itself bear interest.
Section 13.02. Allocation of Realized Losses; Recoveries .
(a) With respect to any Distribution Date, prior to the
Subordination Depletion Date, the applicable Non-PO Percentage of the principal
portion of Realized Losses (other than Debt Service Reductions, Excess Special
Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses) will be
allocated as follows:
first, to the Class B-5 CitiCertificates until their Class B
Subclass Stated Amount has been reduced to zero;
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second, to the Class B-4 CitiCertificates until their Class B
Subclass Stated Amount has been reduced to zero;
third, to the Class B-3 CitiCertificates until their Class B
Subclass Stated Amount has been reduced to zero;
fourth, to the Class B-2 CitiCertificates until their Class B
Subclass Stated Amount has been reduced to zero;
fifth, to the Class B-1 CitiCertificates until their Class B
Subclass Stated Amount has been reduced to zero; and
sixth, to the Class M CitiCertificates until their Stated Amount
has been reduced to zero.
With respect to any Distribution Date, the applicable PO
Percentage of such losses will be allocated to the Stated Amount of the Class
A-9 CitiCertificates.
With respect to any Distribution Date on or after the
Subordination Depletion Date, the applicable Non-PO Percentage of such losses
will be allocated to the Class A CitiCertificates (other than the Class A-9
CitiCertificates), pro rata among such Subclasses on the basis of their
respective Class A Subclass Stated Amounts.
This allocation of Realized Losses will be effected through the
reduction of the applicable Subclass Stated Amount.
Losses and delinquencies resulting from Extraordinary Events
will be allocated in the same manner as Excess Special Hazard Losses, Excess
Fraud Losses and Excess Bankruptcy Losses as set forth in Section 13.02(b).
(b) The principal portion of Excess Special Hazard Losses,
Excess Fraud Losses and Excess Bankruptcy Losses shall be allocated as follows:
The applicable PO Percentage of such Realized Losses shall be allocated to the
Class A-9 CitiCertificates and the applicable Non-PO Percentage of such Realized
Losses shall be allocated on a pro rata basis among the Class A Subclasses
(other than the Class A-9 CitiCertificates), Class M CitiCertificates and Class
B Subclasses based on the Stated Amount of each such Subclass or Class, prior to
giving effect to distributions in reduction of Stated Amount on the relevant
Distribution Date.
(c) Any Realized Losses allocated to a Subclass of Class A or
Class B CitiCertificates or the Class M CitiCertificates pursuant to Section
13.02(a) or Section 13.02(b) shall be allocated among the CitiCertificates of
such Subclass or Class based on their respective Stated Amounts.
(d) In the event that there is a recovery of an amount in
respect of principal which had previously been allocated as a Realized Loss to
any one or more Subclasses of Class A CitiCertificates, the Class M
CitiCertificates or any one or more Subclasses of Class B CitiCertificates, the
amount of such recovery shall be distributed to the Class A CitiCertificates in
the same manner as such loss was allocated to such Class A Subclass, but only if
and to the extent the Class A CitiCertificates had theretofore been allocated
any Realized Losses in respect of principal. The amount of such recovery
allocated to the Class A CitiCertificates (other than the Class A-9
CitiCertificates) is referred to as the "Reimbursable Class A Non-PO Losses".
The amount of such recovery allocated to the Class A-9 CitiCertificates
(exclusive of amounts in respect of such a Realized Loss previously distributed
in respect of the Class A-9 CitiCertificates as reimbursement of Unpaid PO Loss
Amounts)
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is referred to as the "Reimbursable Class A PO Losses". Any remaining amount of
any such recovery shall be distributed to the Class M CitiCertificates but only
if and to the extent that the Class M CitiCertificates had theretofore been
allocated any Realized Losses ("Reimbursable Class M Losses"), then to the Class
B-1 CitiCertificates but only if and to the extent that the Class B-1
CitiCertificates had theretofore been allocated any Realized Losses and then to
the Class B-2, Class B-3, Class B-4 and Class B-5 CitiCertificates in like
manner (collectively, the "Reimbursable Class B Losses"). A Subclass or Class of
CitiCertificates that is no longer outstanding shall not be entitled to any
share of any such recovery.
(e) The interest portion of Excess Special Hazard Losses, Excess
Fraud Losses and Excess Bankruptcy Losses shall be allocated proportionately
between the CitiCertificates and the Class A-IO Certificates based on (in the
case of the CitiCertificates) the sum of (i) the interest accrued at the Net
Note Rate of the Discount Mortgage Loans and (ii) the product of 7.50% per annum
and the aggregate Adjusted Balance of the Premium Mortgage Loans and (in the
case of Class A-IO Certificates) the Class A-IO Interest Amount, and among the
Class A, Class M and Class B CitiCertificates, pro rata based on the Class A
Interest Amount, the Class M Interest Amount and the Class B Interest Amount.
Any such loss allocated to the Class A CitiCertificates shall be allocated among
the outstanding Subclasses of Class A CitiCertificates based on their Class A
Subclass Interest Percentages. Any such loss allocated to the Class B
CitiCertificates will be allocated between the outstanding Subclasses of Class B
CitiCertificates based on their Class B Subclass Interest Percentages. After the
Subordination Depletion Date, the interest portion of Realized Losses will be
allocated among the outstanding Subclasses of Class A CitiCertificates and the
Class A-IO Certificates as described above. The amount of such losses allocated
to the Class A-IO Certificates will reduce the Class A-IO Interest Amount for
such Distribution Date.
(f) Realized Losses allocated in accordance with this Section
13.02 will be allocated on the Distribution Date in the month following the
month in which such loss was incurred and, in the case of the principal portion
thereof, (x) in the case of Excess Special Hazard Losses, Excess Fraud Losses
and Excess Bankruptcy Losses, prior to giving effect to distributions made under
Section 13.01 on such Distribution Date and (y) in the case of all other
Realized Losses, giving effect to distributions made under Section 13.01 on such
Distribution Date.
(g) On each Distribution Date occurring subsequent to the
Subordination Depletion Date, the interest portion of Realized Losses and the
interest portion of Remittance Delinquencies not covered by Voluntary Advances,
Trustee Advances, Advance Account Advances or Certificate Account Advances with
respect to such Distribution Date will be allocated pro rata between the
CitiCertificates and the Class A-IO Certificates. The pro rata allocation of
such losses and delinquencies between the Class A CitiCertificates and the Class
A-IO Certificates will be made in the same manner as Prepayment Interest
Shortfalls are allocated between the CitiCertificates and the Class A-IO
Certificates. The amount allocated to the Class A-IO Certificates will reduce
the Distributable Class A-IO Interest Amount for such Distribution Date.
Section 13.03. Class L Regular Interest Allocations and
Distributions.
(a) On each Distribution Date, the Class L Regular Interest
shall receive a distribution in respect of principal equal to the amount
distributed in reduction of Stated Amount of the Class A-2 CitiCertificates.
As of any date, the Stated Amount of the Class L Regular
Interest will equal the Stated Amount of the Class A-2 CitiCertificates.
On each Distribution Date, the Class L Regular Interest shall
receive a distribution in respect of interest equal to the amount distributed in
respect of interest to the Class A-2 and Class A-3 CitiCertificates.
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(b) With respect to any Distribution Date, the principal portion
of Realized Losses and recoveries attributable to previously allocated Realized
Losses will be allocated to the Class L Regular Interest in an amount equal to
the amount allocated to the Class A-2 CitiCertificates.
With respect to any Distribution Date, the interest portion of
Realized Losses will be allocated to the Class L Regular Interest in the same
manner as interest is allocated to such Class L Regular Interest.
(c) No interest shortfall amount or unpaid interest shortfall on
the Class L Regular Interest will bear interest.
(d) The Distribution Date Statement prepared by the Servicer
pursuant to Section 3.03(f) shall include the following additional information:
(i) the distributions of principal in reduction of the Stated
Amount of the Class L Regular Interest and the Stated Amount of the
Class L Regular Interest that will remain outstanding after giving
effect to such distribution;
(ii) the amount of interest that has accrued on the Class L
Regular Interest and any Non-Supported Interest Shortfall allocated
thereto;
(iii) the amount of interest to be distributed on the Class L
Regular Interest;
(iv) the amount of the principal portion of Excess Special
Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses
allocable to the Class L Regular Interest; and
(v) the interest portion of Excess Special Hazard Losses,
Excess Fraud Losses and Excess Bankruptcy Losses allocable to the
Class L Regular Interest.
Section 13.04 Distributions on the Residual Certificates . Upon a
termination of the Trust in accordance with Section 9.01, the Class LR
Certificate shall receive all amounts remaining in the Certificate Account and
the Class R Certificate shall receive any amounts remaining in the Upper-Tier
REMIC Account after all required distributions on the CitiCertificates, the
Class A-IO Certificates and the Class L Regular Interest have been made.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective officers and their respective
seals to be hereunto affixed, all as of the day and year first above written.
CITICORP MORTGAGE SECURITIES, INC.
[SEAL]
By____________________
John Outland
Senior Vice President
THE BANK OF NEW YORK, in its individual capacity and as
Trustee
[SEAL]
By____________________
Vice President
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<PAGE>
State of New York )
) ss.:
County of New York )
On the 19th day of December 1996 before me, a notary public in
and for the State of New York, personally appeared John Outland known to me who,
being by me duly sworn, did depose and say that he resides at New York, New
York; that he is a Vice President of Citicorp Mortgage Securities, Inc., one of
the parties that executed the foregoing instrument; that he knows the seal of
said corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by authority of the Board of Directors of said
corporation; and that he signed his name thereto by like authority.
-----------------------------------
Notary Public
[Notarial Seal]
State of New York )
) ss.:
County of New York )
On the 19th day of December 1996 before me, a notary public in
and for the State of New York, personally appeared ________________ known to me
who, being by me duly sworn, did depose and say that he resides at ____________,
New York, New York 10016, that she is a Vice President of The Bank of New York,
a New York banking corporation, one of the parties that executed the foregoing
instrument; that he knows the seal of said New York banking corporation; that
the seal affixed to said instrument is such seal; that it was so affixed by
authority of the Board of Directors of said New York banking corporation; and
that he signed his name thereto by like authority.
-----------------------------------
Notary Public
[Notarial Seal]
27
<PAGE>
----------------------------------------------------
STANDARD TERMS FOR POOLING AND
SERVICING AGREEMENTS
FOR SINGLE-TIER THREE-CLASS
CITICERTIFICATES
----------------------------------------------------
Dated as of December 1, 1996
REMIC Pass-Through Certificates, Series 1996-1
-----------------------------------------------------
<PAGE>
THESE STANDARD TERMS FOR POOLING AND SERVICING AGREEMENTS FOR
SINGLETIER THREE-CLASS CITICERTIFICATES, dated as of December 1, 1996 (the
"Standard Terms Document"), declare the basic terms and conditions upon which
one or more series of pass-through certificates packaged and serviced by
Citicorp Mortgage Securities, Inc. are to be issued, authenticated and delivered
from time to time pursuant to, with respect to each such series, a Pooling and
Servicing Agreement (a "Pooling Agreement") between CMSI as packager, servicer
and master servicer, and the institution named therein as trustee establishing
such series.
This Standard Terms Document as incorporated in a Pooling Agreement
shall apply to the series of pass-through certificates established thereby to
the extent provided therein. Hereinafter, references to the "Pooling Agreement"
and the pass-through certificates executed and delivered thereunder and to terms
such as "this Agreement", "herein", "hereof" and words of similar import shall
refer only to a particular Pooling Agreement, including as and to the extent
incorporated therein this Standard Terms Document, and the series of
pass-through certificates established thereby.
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases, unless die context otherwise requires, shall have
the following meanings, and the definitions of such terms are applicable to the
singular as well as the plural form of such terms and to the masculine as well
as to the feminine and neuter genders of such terms. Whenever any reference is
made to an amount the determination or calculation of which is governed by
Section 1.02, the provisions of Section 1.02 shall be applicable to such
determination or calculation, whether or not reference is specifically made to
Section 1.02, unless some other method of calculation or determination is
expressly specified in the particular provision.
Accountant: A Person engaged in the practice of accounting who (except
when this Pooling Agreement provides that an Accountant must be independent) may
be employed by or affiliated with CMSI or an Affiliate of CMSI.
Act: The Securities Act of 1933, as amended.
Adjusted Balance: With respect to any Mortgage Loan as of any date, the
scheduled principal balance thereof as of the close of business on the first day
of the month in which such date falls (whether or not any scheduled principal
payments have been received), without regard to any adjustments thereof in
connection with Mortgagor bankruptcies (other than a Deficient Valuation), less
any Principal Prepayments thereon or in respect thereof received or posted prior
to the close of business on the business day preceding such first day (or, in
the case of the Cut-Off Date, any Principal Prepayments thereon or in respect
thereof received or posted prior to the close of business on the Cut-Off Date).
Advance Account: The account established and maintained pursuant to
the Advance Account Depository Agreement. Such account shall meet the
requirements stated in Section 11.02 hereto for the Certificate Account or shall
be held in the corporate trust department of a depository institution with trust
powers.
Advance Account Advances: The aggregate of the Trustee Failure
Advances made from the Advance Account pursuant to Section 8.14, and deposited
into the Certificate Account, the amount of any such Advance Account Advance
with respect to a Distribution Date being no more than the Advance Account
Available Advance Amount.
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Advance Account Available Advance Amount: As defined in the Advance
Account Depository Agreement.
Advance Account Depository Agreement: The Advance Account Depository
Agreement to be executed by the Advance Account Depository, the Trustee, in its
individual capacity and as Trustee, and the Servicer. substantially in the form
attached hereto on or before an Advance Account Funding Date.
Advance Account Depository: The depository institution with which the
Advance Account will be maintained pursuant to the Advance Account Depository
Agreement.
Advance Account Funding Date: The tenth Business Day following the
Advance Account Trigger Date.
Advance Account Reimbursement Amount: As defined in Section 8.14.
Advance Account Trigger Applicability: As specified in Article XII.
Advance Account Trigger Date: The date upon which the senior long
ten-n debt of Citicorp or the Trustee is downgraded by Moody's below Baa3 and
Al, respectively; provided, however, if Moody's has advised the Servicer that
such downgrade would not cause the Class A CitiCertificates or the Class B
CitiCertificates to be downgraded then such date shall not be considered an
Advance Account Trigger Date for purposes of this Agreement. If Moody's advises
the Servicer pursuant to the above proviso, Moody's may also specify the new
rating levels at which a downgrade would result in an Advance Account Trigger
Date and such rating levels shall replace the rating levels specified in the
preceding sentence.
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Affiliated Certificate Account Advance: With respect to any
Distribution Date, the amount of any Affiliated Uncommitted Cash to be
distributed to Certificateholders to cover Remittance Delinquencies related to
any Affiliated Mortgage Loan on such Distribution Date.
Affiliated Mortgage Loans: The Mortgage Loans listed in Exhibit B-2
hereto.
Affiliated Prepayment Interest Shortfall Amount: With respect to any
Distribution Date and the CitiCertificates or the Class A-IO Certificates, the
pro rata share of the Prepayment Interest Shortfalls for the Affiliated Mortgage
Loans allocated thereto based on (in the case of the CitiCertificates) the sum
of (1) the interest accrued at the Net Note Rates of the Discount Mortgage Loans
which are Affiliated Mortgage Loans during the related Due Period and (ii) the
product of (x) 7.50% per annum and (y) the aggregate Adjusted Balance of the
Premium Mortgage Loans or (in the case of the Class A-IO Certificates) the Class
A-IO Interest Amount.
Affiliated Trustee Advances: The aggregate of the advances with
respect to any Affiliated Mortgage Loans made by the Trustee pursuant to Section
8.13, and deposited into the Certificate Account, the amount of any such
Affiliated Trustee Advance with respect to a Distribution Date being no more
than (a) the aggregate of Remittances on the Affiliated Mortgage Loans that were
due on the preceding Due Date and delinquent as of the related Determination
Date less (b) the sum of Voluntary Advances in respect of Affiliated Mortgage
Loans and the amount of Affiliated Uncommitted Cash.
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Affiliated Uncommitted Cash: Any Uncommitted Cash relating to an
Affiliated Mortgage Loan.
Agent: As defined in Section 5.02.
Aggregate Outstanding Advances: As of any Determination Date, the
aggregate of Net Voluntary Advances, Net Trustee Advances and Net Advance
Account Advances made by CMSI, as Servicer or Master Servicer, as the case may
be, or the Trustee (in its individual capacity, pursuant to Section 8.13) for
the period from the Cut-Off Date to such Determination Date (plus any Voluntary
Advances, Trustee Advances, Advance Account Advances, Affiliated Certificate
Account Advances and Conduit Certificate Account Advances to be made on the next
succeeding Distribution Date).
Aggregate Pool Value Change: With respect to any Determination Date, an
amount equal to
(a) the aggregate of the Pool Values of all Mortgage Loans, determined
as of the preceding Determination Date (or, in the case of the first
Determination Date, the aggregate of the Pool Values of all Mortgage Loans as of
the Cut-Off Date), less
(b) the aggregate of the Pool Values of all such Mortgage Loans
determined as of such Determination Date.
Appraisal : With respect to a Mortgage Loan, the appraisal conducted in
connection with the origination of such Mortgage Loan, whether originated upon
the purchase of the related Mortgaged Property or in connection with a
refinancing.
Assumed Reinvestment Rate : The respective percentage or percentages
per annum specified in Article XII, compounded monthly unless otherwise
specified in Article XII.
Authenticating Agent : The Authenticating Agent appointed pursuant to
Section 8.12 and identified in Article XII which is authorized by the Trustee to
authenticate the Certificates on behalf of the Trustee. The Authenticating Agent
may be an Affiliate of CMSI.
Authorized Officer : With respect to CMSI, the Chairman of the Board of
Directors, the President, any Executive Vice President, Senior Vice President,
Vice President, Controller, Assistant Controller, Secretary, Assistant
Secretary, Treasurer or Assistant Treasurer, or any other natural person
designated in an Officer's Certificate signed by any of the foregoing officers
and furnished to the Trustee.
Available PO Loss Funds : As defined in Article XII.
Bankruptcy Code: The United States Bankruptcy Code of 1978, as amended.
Bankruptcy Coverage Termination Date : The Distribution Date upon which
the Bankruptcy Loss Amount has been reduced to zero or a negative number (or the
Subordination Depletion Date, if earlier).
Bankruptcy Loss : With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction; provided however, that a Bankruptcy Loss
shall not be deemed a Bankruptcy Loss hereunder so long as the Servicer has
notified the Trustee in writing that the Servicer is diligently pursuing any
remedies that may exist in connection with the representations and warranties
made regarding the related Mortgage Loan and either (A) the related Mortgage
Loan is not in default with regard to payments due thereunder or (B) delinquent
payments of principal and interest under the related Mortgage Loan and any
premiums on any applicable primary hazard
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insurance policy and any related escrow payments in respect of such Mortgage
Loan are being advanced on a current basis by the Servicer without giving effect
to any Debt Service Reduction.
Bankruptcy Loss Amount : As of any Distribution Date prior to the first
anniversary of the Cut-Off Date, the Bankruptcy Loss Amount will equal the
Initial Bankruptcy Loss Amount minus the aggregate amount of Bankruptcy Losses
since the Cut-Off Date. As of any Distribution Date on or after the first
anniversary of the Cut-Off Date, an amount equal to (1) the lesser of (a) the
Bankruptcy Loss Amount calculated as of the close of business on the Business
Day immediately preceding the most recent anniversary of the Cut-Off Date
coinciding with or preceding the such Distribution Date (the "Relevant
Anniversary") and (b) $100,000 minus (2) the aggregate amount of Bankruptcy
Losses since the Relevant Anniversary.
The Bankruptcy Loss Amount may be further reduced by CMSI (including
accelerating the manner in which such coverage is reduced) provided that prior
to any such reduction, CMSI shall obtain written confirmation from each Rating
Agency that such reduction shall not adversely affect the then-current rating
assigned to the CitiCertificates by each Rating Agency and shall provide a copy
of such written confirmation to the Trustee.
Beneficial Owner : With respect to a Certificate held by a Clearing
Agency, the Person who is the beneficial owner of such Certificate as reflected
on the books of such Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly or as an indirect participant, in
accordance with the rules of such Clearing Agency).
Book-Entry Certificates: The Classes or Subclasses of CitiCertificates
specified as such in Article XII.
Business Day: Any day other than a Saturday, a Sunday or a day on which
banking institutions in New York, New York or in the cities where the Trustee,
any Paying Agent, the Servicer and the Subservicer, if any, are located are
authorized or obligated by law or executive order to be closed or, if there are
Book-Entry Certificates, any day on which the relevant Clearing Agency is
closed.
Buydown Account: The deposit account or accounts, which may bear
interest, created and maintained by CMSI in the name of the Trustee for the
benefit of the Mortgagors, subject to the rights of the Trustee pursuant to the
Buydown Subsidy Agreements.
Buydown Funds: Funds contributed at origination by the seller or buyer
of a property subject to a Buydown Mortgage Loan, or by any other source, plus
interest earned thereon, in order to reduce the payments required from the
Mortgagor for a specified period in specified amounts.
Buydown Mortgage Loan: Any Mortgage Loan in respect of which, pursuant
to a Buydown Subsidy Agreement, (i) the Mortgagor pays less than the full
monthly payments specified the Mortgage Note for a specified period and (ii) the
difference between the payments required under such Buydown Subsidy Agreement
and the Mortgage Note is provided from Buydown Funds.
Buydown Subsidy Agreement: The agreement relating to a Buydown
Mortgage Loan pursuant to which an Originator may apply the Buydown Funds to a
Mortgagor's payments.
Calculated Class A Distribution Amount: With respect to any
Distribution Date, the sum of (a) the Class A Interest Amount, (b) any Class A
Unpaid Interest Shortfall, (c) the Class A Optimal Principal Amount and (d) the
PO Loss Amount.
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Calculated Servicing Fee: With respect to any Distribution Date, the
Servicing Fee for each Affiliated Mortgage Loan as set forth in Article XII
without regard to whether the Servicer has received a payment on account of
interest with respect to such Mortgage Loan.
Certificate: Any CitiCertificate, Class A-IO Certificate or Residual
Certificate.
Certificate Account: The account or accounts created and maintained
pursuant to Sections 3.02 and 3.04. The term Certificate Account shall be deemed
to include an Alternative Certificate Account (as defined in Section 11.02).
Certificate Account Deposit Date: As to any Distribution Date, the
Business Day preceding such Distribution Date.
Certificate Register and Certificate Registrar: The register
maintained pursuant to Section 5.02 and the Certificate Registrar identified in
Article XII.
Certificateholder or Holder: The Person in whose name a
Certificate is registered in the Certificate Register.
Citibank: Citibank, N.A., a national banking association.
CitiCertificateholder: A Holder of a CitiCertificate.
CitiCertificates: The certificates defined as such pursuant to
Article XII.
CitiMae Mortgage Loans: The Mortgage Loans (if any) listed in Exhibit
B-1 hereto.
CitiMae Prepayment Interest Shortfall Amount: With the respect to any
Distribution Date and the CitiCertificates or the Retained Fixed Yield, the pro
rata share of the Prepayment Interest Shortfall for the CitiMae Mortgage Loans
allocated thereto based on (in the case of the CitiCertificates) the interest
accrued at the NNRs of the CitiMae Mortgage Loans during the related Due Period
or (in the case of the Retained Fixed Yield the aggregate Retained Fixed Yield
Amount) for such Distribution Date.
Class: With respect to CitiCertificates, any group of CitiCertificates
designated as a Class in Article XII, with respect to the Class A-IO
Certificates, all Class A-IO Certificates, with respect to the Class L Regular
Interest, the regular interest in the Lower-Tier REMIC designated as such in
Article XII and with respect to Residual Certificates, all Residual Certificates
having the same Class designation.
Class A Certificateholder: A registered holder of a Class A
CitiCertificate.
Class A CitiCertificate: A Certificate of any Class or Subclass
designated as a Class A CitiCertificate in Article XII.
Class A Interest Amount: With respect to any Distribution Date prior to
the Subordinated Depletion Date, the sum of the Class A Subclass Interest
Amounts with respect to such Distribution Date.
Class A Optimal Principal Amount: As defined in Article XII.
Class A Prepayment Percentage: As defined in Article XII.
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Class A Percentage: As defined in Article XII.
Class A Principal Distribution Amount: As defined in Article XII.
Class A PO Principal Amount: As defined in Article XII.
Class A Stated Amount: The sum of the Class A Subclass Stated Amounts
of the Class A Subclasses.
Class A Subclass: As specified in Article XII.
Class A Subclass Interest Amount: As to any Distribution Date and any
Class A Subclass (other than the Class A-9 CitiCertificates), (i) the amount of
interest accrued during the related Interest Accrual Period at the applicable
Stated Rate on the Class A Subclass Stated Amount (or in the case of the Class
A-3 CitiCertificates, the Class A-3 Notional Amount) of such Class A Subclass as
of the Determination Date preceding such Distribution Date minus (ii) the Class
A Subclass Interest Percentage of such Class A Subclass of (x) any Non-Supported
Interest Shortfall allocated to the Class A CitiCertificates (other than the
Class A-9 CitiCertificates) with respect to such Distribution Date and (y) the
interest portion of any Excess Special Hazard Losses, Excess Fraud Losses and
Excess Bankruptcy Losses allocated to the Class A CitiCertificates (other than
the Class A-9 CitiCertificates) with respect to such Distribution Date pursuant
to Section 13.02(e).
Class A Subclass Interest Percentage: As to any Distribution Date and
any Class A Subclass (other than the Class A-9 CitiCertificates), the percentage
calculated by dividing the Class A Subclass Interest Amount of such Class A
Subclass (determined without regard to clause (ii) of the definition thereof by
the Class A Interest Amount (determined without regard to clause (ii) of the
definition of each Class A Subclass Interest Amount).
Class A Subclass Interest Shortfall Amount: As to any Distribution Date
and Class A Subclass (other than the Class A-9 CitiCertificates), any amount by
which the Class A Subclass Interest Amount of such Class A Subclass with respect
to such Distribution Date exceeds the amount distributed in respect of such
Class A Subclass on such Distribution Date pursuant to Paragraph first of
Section 13.01(b).
Class A Subclass Loss Denominator: As to any Distribution Date, an
amount equal to the sum of (1) the Class A Subclass Stated Amounts of the Class
A Subclasses (other than the Class A-9 CitiCertificates) determined as of the
preceding Distribution Date (after giving effect to distributions in reduction
of Stated Amounts and allocations of losses on such date).
Class A Subclass Loss Percentage: As to any Distribution Date and any
Class A Subclass (other than the Class A-9 CitiCertificates), the percentage
calculated by dividing the Class A Subclass Stated Amount of such Class A
Subclass by the Class A Subclass Loss Denominator, in each case determined as of
the preceding Distribution Date (after giving effect to distributions in
reduction of Stated Amount and allocations of losses on such date); provided
that in the case of the Class A-3 CitiCertificates, such percentage shall be
zero for all Distribution Dates.
Class A Subclass Stated Amount: As of the first Distribution Date and
as to any Class A Subclass, the Initial Stated Amount of such Class A Subclass
as set forth in Section 12.01(a). As of any subsequent Distribution Date prior
to the Subordination Depletion Date and as to any Class A Subclass (other than
the Class A-9 CitiCertificates), the Initial Stated Amount of such Class A
Subclass less the sum of (a) all amounts previously distributed in respect of
such Class A Subclass on prior Distribution Dates pursuant to Paragraph third of
Section 13.01(b) and (b) the Class A Subclass Loss Percentage of such Class A
Subclass of the principal portion of Excess Special Hazard Losses, Excess Fraud
Losses and Excess Bankruptcy Losses previously
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allocated to the Class A CitiCertificates (other than the Class A-9
CitiCertificates) pursuant to Section 13.02. On each Distribution Date on or
after the Subordination Depletion Date, each Class A Subclass Stated Amount
(other than with respect to the Class A-9 CitiCertificates) will also be reduced
on each Distribution Date by an amount equal to the product of the Class A
Subclass Loss Percentage of such Class A Subclass and the difference if any
between (1) the Class A Stated Amount (after subtracting the Stated Amount of
the Class A-9 CitiCertificates) for such Distribution Date without regard to
this sentence and (2) the Non-PO Pool Adjusted Balance for the preceding
Distribution Date. As of any Distribution Date the Class A Subclass Stated
Amount of the Class A-9 CitiCertificates will equal the difference between the
Pool Adjusted Balance and the Non-PO Pool Adjusted Balance as of such date.
Class A Subclass Unpaid Interest Shortfall: As to any Distribution Date
and Class A Subclass, the amount, if any, by which the aggregate of the Class A
Subclass Interest Shortfall Amounts for such Class A Subclass for prior
Distribution Dates is in excess of the amounts distributed in respect of such
Class A Subclass on prior Distribution Dates pursuant to Paragraph second of
Section 13.01(b) or, after the Subordination Depletion Date, pursuant to
13.01(c).
Class A Unpaid Interest Shortfall: As to any Distribution Date prior to
the Subordination Depletion Date, an amount equal to the sum of the Class A
Subclass Unpaid Interest Shortfall for the Class A Subclasses.
Class A-IO Interest Amount: As defined in Article XII.
Class A-IO Interest Shortfall Amount: As to any Distribution Date, any
amount by which the Distributable Class A-IO Interest Amount with respect to
such Distribution Date exceeds the amount distributed in respect of the Class
A-IO Certificates pursuant to Paragraph first of Section 13.01(b).
Class A-IO Prepayment Interest Shortfall Amount: With respect to any
Distribution Date, the aggregate of (x) the excess, if any, of (A) the
Prepayment Interest Shortfall Amount allocated to the Class A-IO Certificates
over (B) the Compensating Cap, less the portion of the Compensating Cap
allocated to the CitiCertificates in respect of Prepayment Interest Shortfall
Amounts.
Class A-IO Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class A-IO Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class A-IO Certificates in prior Distribution Dates pursuant to
Paragraph second of Section 13.01(b).
Class A-3 Notional Amount: As defined in Article XII.
Class A-3 Voting Interest: So long as the Class A-3 Certificates are
Outstanding, 2.0%; thereafter
0%.
Class B Certificateholder: A registered holder of a Class B
CitiCertificate.
Class B CitiCertificate: A Certificate of any Class or Subclass
designated as a Class B CitiCertificate in Article XII.
Class B Interest Amount: As to any Distribution Date, the sum of the
Class B Subclass Interest Amounts with respect to such Distribution Date.
Class B Percentage: As defined in Article XII.
Class B Prepayment Percentage: As defined in Article XII.
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Class B Principal Distribution Amount: With respect to any Distribution
Date the sum of the Class B-1 Principal Distribution Amount, Class B-2 Principal
Distribution Amount, Class B-3 Principal Distribution Amount, Class B-4
Principal Distribution Amount and Class B-5 Principal Distribution Amount.
Class B Stated Amount: As to any Distribution Date, the sum of the
Class B Subclass Stated Amounts of the Class B Subclasses.
Class B Subclasses: As specified in Article XII.
Class B Subclass Interest Amount: As to any Distribution Date and any
Class B Subclass, (i) the amount of interest accrued during the related Interest
Accrual Period at the applicable Stated Rate on the Class B Subclass Stated
Amount of such Class B Subclass as of the Determination Date preceding such
Distribution Date minus (ii) the Class B Subclass Interest Percentage of such
Class B Subclass of (x) any Non-Supported Interest Shortfall allocated to the
Class B CitiCertificates with respect to such Distribution Date and (y) the
interest portion of any Excess Special Hazard Losses, Excess Fraud Losses and
Excess Bankruptcy Losses allocated to the Class B CitiCertificates with respect
to such Distribution Date pursuant to Section 13.02(e).
Class B Subclass Interest Percentage: As to any Distribution Date and
any Class B Subclass, the percentage calculated by dividing the Class B Subclass
Interest Amount of such Class B Subclass (determined without regard to clause
(ii) of the definition thereof) by the Class B Interest Amount (determined
without regard to clause (ii) of the definition of each Class B Subclass
Interest Amount).
Class B Subclass Stated Amount: As to the first Distribution Date and
any Class B Subclass, the Initial Stated Amount of such Class B Subclass as set
forth in Section 12.01(a). As of any subsequent Distribution Date, the lesser of
(i) such Initial Stated Amount less the sum of (a) all amounts previously
distributed in respect of such Class B Subclass on prior Distribution Dates
pursuant to Paragraphs tenth, thirteenth, sixteenth, nineteenth and
twenty-second, as applicable, of Section 13.01(b) and (b) the Excess Special
Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses previously
allocated to such Class B Subclass pursuant to Section 13.02 and (ii) the Pool
Adjusted Balance less the sum of the Class A Stated Amount, the Class M Stated
Amount and the Class B Subclass Stated Amounts of the Class B Subclasses with
lower numerical designations each as of the preceding Distribution Date (after
taking into account distributions in reduction of Stated Amount and the
allocation of any Excess Special Hazard Losses, Excess Fraud Losses and Excess
Bankruptcy Losses on such date).
Class B Unpaid Interest Shortfall: With respect to any Distribution
Date, the sum of the Class B-1 Unpaid Interest Shortfall, Class B-2 Unpaid
Interest Shortfall, Class B-3 Unpaid Interest Shortfall, Class B-4 Unpaid
Interest Shortfall and Class B-5 Unpaid Interest Shortfall.
Class B-1 Interest Shortfall Amount: As to any Distribution Date any
amount by which the Class B Subclass Interest Amount of the Class B-1
CitiCertificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-1 CitiCertificates pursuant to Paragraph
eighth of Section 13.01(b).
Class B-1 Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum of
(i) the Class B-1 Percentage of the applicable Non-PO Percentage of (A)
the principal portion of all Monthly Payments due on the Due Date occurring in
the month of such Distribution Date on each Outstanding Mortgage Loan, less (B)
if the Bankruptcy Coverage Termination Date has occurred, the principal portion
of Debt Service Reductions;
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(ii) the Class B-1 Prepayment Percentage of the applicable Non-PO
Percentage of all partial Principal Prepayments received by the Servicer during
the month preceding the month in which such Distribution Date occurs, together
with the Class B-1 Prepayment Percentage of the applicable Non-PO Percentage of
the Adjusted Balance of each Mortgage Loan which was the subject of a Principal
Prepayment in full during the month preceding the month of such Distribution
Date;
(iii) the Class B-1 Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net Liquidation Proceeds
from each Mortgage Loan which became a Liquidated Loan during the month
preceding the month of such Distribution Date minus any unreimbursed Voluntary
Advances in respect of principal previously made by the Servicer and (2) the
portion of such aggregate Net Liquidation Proceeds allocable to interest;
(iv) the Class B-1 Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was repurchased
by CMSI during such preceding month pursuant to Section 2.03; and
(v) the amount of any recovery in respect of a Realized Loss
allocated to the Class B-1 CitiCertificates pursuant to Section 13.02(d).
Class B-1 Percentage: As to any Distribution Date. the percentage
calculated by multiplying (i) the Class B Percentage by (ii) a fraction, the
numerator of which is the Class B Subclass Stated Amount of the Class B-1
CitiCertificates and the denominator of which is the sum of the Class B Subclass
Stated Amounts of the Class B Subclasses (eligible to receive principal
distributions for such Distribution Date in accordance with Section 13.01(d)),
each as of the immediately preceding Distribution Date (after giving effect to
any distributions in reduction of Stated Amount and the allocation of any losses
on such date).
Class B-1 Prepayment Percentage: As to any Distribution Date, the
percentage calculated by multiplying (i) the Class B Prepayment Percentage by
(ii) a fraction, the numerator of which is the Class B Subclass Stated Amount of
the Class B- 1 CitiCertificates and the denominator of which is the sum of the
Class B Subclass Stated Amounts of the Class B Subclasses (eligible to receive
principal distributions for such Distribution Date in accordance with Section
13.01(d)), each as of the immediately preceding Distribution Date (after giving
effect to any distributions in reduction of Stated Amount and the allocation of
any losses on such date).
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the amount distributed in respect of the Class B-1
CitiCertificates pursuant to Paragraph tenth of Section 13.01(b).
Class B-1 Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class B-1 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-1 CitiCertificates in prior Distribution Dates pursuant
to Paragraph ninth of Section 13.01(b).
Class B-2 Interest Shortfall Amount: As to any Distribution Date, any
amount by which the Class B Subclass Interest Amount of the Class B-2
CitiCertificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-2 CitiCertificates on such Distribution
Date pursuant to Paragraph eleventh of Section 13.01(b).
Class B-2 Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum of:
(i) the Class B-2 Percentage of the applicable Non-PO Percentage of
(A) the principal portion of all Monthly Payments due on the Due Date occurring
in the month of such Distribution Date on each Outstanding
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Mortgage Loan, less (B) if the Bankruptcy Coverage Termination Date has
occurred, the principal portion of Debt Service Reductions;
(ii) the Class B-2 Prepayment Percentage of the applicable Non-PO
Percentage of all partial Principal Prepayments received by the Servicer during
the month preceding the month in which such Distribution Date occurs, together
with the Class B-2 Prepayment Percentage of the applicable Non-PO Percentage of
the Adjusted Balance of each Mortgage Loan which was the subject of a Principal
Prepayment in full during the month preceding the month of such Distribution
Date;
(iii) the Class B-2 Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net Liquidation Proceeds
from each Mortgage Loan winch became a Liquidated Loan during the month
preceding the month of such Distribution Date minus any unreimbursed Voluntary
Advances in respect of principal previously made by the Servicer and (2) the
portion of such aggregate Net Liquidation Proceeds allocable to interest;
(iv) the Class B-2 Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was repurchased
by CMSI during such preceding month pursuant to Section 2.03; and
(v) the amount of any recovery in respect of a Realized Loss
allocated to the Class B-2 CitiCertificates pursuant to Section 13.02(d).
Class B-2 Percentage: As to any Distribution Date, except as set forth
in the next sentence, the Percentage calculated by multiplying (i) the Class B
Percentage by (ii) a fraction, the numerator of which is the Class B Subclass
Stated Amount of the Class B-2 CitiCertificates and the denominator of which is
the sum of the Class B Subclass Stated Amounts of the Class B Subclasses
(eligible to receive principal distributions for such Distribution Date in
accordance with Section 13. 0 1 (d)), each as of the immediately preceding
Distribution Date (after giving effect to any distributions in reduction of
Stated Amount and the allocation of any losses on such date). In the event that
the Class B-2 CitiCertificates are not eligible to receive distributions of
principal in accordance with Section 13.01(d), the Class B-2 Percentage for such
Distribution Date will be zero.
Class B-2 Prepayment Percentage: As to any Distribution Date, except as
set forth in the next sentence. the percentage calculated by multiplying (i) the
Class B Prepayment Percentage by (ii) a fraction, the numerator of which is the
Class B Subclass Stated Amount of the Class B-2 CitiCertificates and the
denominator of which is the sum of the Class B Subclass Stated Amounts of the
Class B Subclasses (eligible to receive principal distributions for such
Distribution Date in accordance with Section 13.01(d)), each as of the
immediately preceding Distribution Date (after giving effect to any
distributions in reduction of Stated Amount and the allocation of any losses on
such date), In the event that the Class B-2 CitiCertificates are not eligible to
receive distributions of principal in accordance with Section 13.01(d), the
Class B-2 Prepayment Percentage for such Distribution Date will be zero.
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date the amount distributed in respect of the Class B-2
CitiCertificates pursuant to Paragraph thirteenth of Section 13.01(b).
Class B-2 Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class B-2 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-2 CitiCertificates on prior Distribution Dates pursuant
to Paragraph twelfth of Section 13.01(b).
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Class B-3 Interest Shortfall Amount: As to any Distribution Date, any
amount by which the Class B Subclass Interest Amount of the Class B-3
CitiCertificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-3 CitiCertificates on such Distribution
Date pursuant to Paragraph fourteenth of Section 13.01(b).
Class B-3 Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum of:
(i) the Class B-3 Percentage of the applicable Non-PO Percentage of
(A) the principal portion of all Monthly Payments due on the Due Date occurring
in the month of such Distribution Date on each Outstanding Mortgage Loan, less
(B) if the Bankruptcy Coverage Termination Date has occurred, the principal
portion of Debt Service Reductions;
(ii) the Class B-3 Prepayment Percentage of the applicable Non-PO
Percentage of all partial Principal Prepayments received by the Servicer during
the month preceding the month in which such Distribution Date occurs, together
with the Class B-3 Prepayment Percentage of the applicable Non-PO Percentage of
the Adjusted Balance of each Mortgage Loan which was die subject of a Principal
Prepayment in full during the month preceding the month of such Distribution
Date;
(iii) the Class B-3 Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net Liquidation Proceeds
from each Mortgage Loan which became a Liquidated Loan during the month
preceding the month of such Distribution Date minus any unreimbursed Voluntary
Advances in respect of principal previously made by the Servicer and (2) the
portion of such aggregate Net Liquidation Proceeds allocable to interest;
(iv) the Class B-3 Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was repurchased
by CMSI during such preceding month pursuant to Section 2.03; and
(v) the amount of any recovery in respect of a Realized Loss
allocated to the Class B-3 CitiCertificates pursuant to Section 13.02(d).
Class B-3 Percentage: As to any Distribution Date. except as set forth
in the next sentence, the percentage calculated by multiplying (i) the Class B
Percentage by (ii) a fraction, the numerator of which is the Class B Subclass
Stated Amount of the Class B-3 CitiCertificates and the denominator of which is
the sum of the Class B Subclass Stated Amounts of the Class B Subclasses
(eligible to receive principal distributions for such Distribution Date in
accordance with Section 13.01(d)), each as of the immediately preceding
Distribution Date (after giving effect to any distributions in reduction of
Stated Amount and the allocation of any losses on such date). In the event that
the Class B-3 CitiCertificates are not eligible to receive distributions of
principal in accordance with Section 13.01(d), the Class B-3 Percentage for such
Distribution Date will be zero.
Class B-3 Prepayment Percentage: As to any Distribution Date, except as
set forth in the next sentence, the percentage calculated by multiplying (i) the
Class B Prepayment Percentage by (ii) a fraction, the numerator of which is the
Class B Subclass Stated Amount of the Class B-3 CitiCertificates and the
denominator of which is the sum of the Class B Subclass Stated Amounts of the
Class B Subclasses (eligible to receive principal distributions for such
Distribution Date in accordance with Section 13.01(d)), each as of the
immediately preceding Distribution Date (after giving effect to any
distributions in reduction of Stated Amount and the allocation of any losses on
such date). In the event that the Class B-3 CitiCertificates are not eligible to
receive distributions of principal in accordance with Section 13.01(d), the
Class B-3 Prepayment Percentage for such Distribution Date will be zero.
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Class B-3 Principal Distribution Amount: With respect to any
Distribution Date, the amount distributed in respect of the Class B-3
CitiCertificates pursuant to Paragraph sixteenth of Section 13.01(b).
Class B-3 Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class B-3 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-3 CitiCertificates on prior Distribution Dates pursuant
to Paragraph fifteenth of Section 13.01(b).
Class B-4 Interest Shortfall Amount: As to any Distribution Date, any
amount by which the Class B Subclass Interest Amount of the Class B-4
CitiCertificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-4 CitiCertificates on such Distribution
Date pursuant to Paragraph seventeenth of Section 13.01(b).
Class B-4 Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum of:
(i) the Class B-4 Percentage of the applicable Non-PO Percentage of
(A) the principal portion of all Monthly Payments due on the Due Date occurring
in the month of such Distribution Date on each Outstanding Mortgage Loan, less
(B) if the Bankruptcy Coverage Termination Date has occurred, the principal
portion of Debt Service Reductions;
(ii) the Class B-4 Prepayment Percentage of the applicable Non-PO
Percentage of all partial Principal Prepayments received by the Servicer during
the month preceding the month in which such Distribution Date occurs, together
with the Class B-4 Prepayment Percentage of the applicable Non-PO Percentage of
the Adjusted Balance of each Mortgage Loan which was subject of a Principal
Prepayment in full during
the month preceding the month of such Distribution Date;
(iii) the Class B-4 Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net Liquidation Proceeds
from each Mortgage Loan which became a Liquidated Loan during the month
preceding the month of such Distribution Date minus any unreimbursed Voluntary
Advances in respect of principal previously made by the Servicer and (2) the
portion of such aggregate Net Liquidation Proceeds allocable to interest;
(iv) the Class B-4 Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was repurchased
by CMSI during such preceding month pursuant to Section 2.03; and
(v) the amount of any recovery in respect of a Realized Loss
allocated to the Class B-4 CitiCertificates pursuant to Section 13.02(d).
Class B-4 Percentage: As to any Distribution Date, except as set forth
in the next sentence, the percentage calculated by multiplying (i) the Class B
Percentage by (ii) a fraction, the numerator of which is the Class B Subclass
Stated Amount of the Class B-4 CitiCertificates and the denominator of which is
the sum of the Class B Subclass Stated Amounts of the Class B Subclasses
(eligible to receive principal distributions for such Distribution Date in
accordance with Section 13.01(d)), each as of the immediately preceding
Distribution Date (after giving effect to any distributions in reduction of
Stated Amount and the allocation of any losses on such date). In the event that
the Class B-4 CitiCertificates are not eligible to receive distributions of
principal in accordance with Section 13.01(d), the Class B-4 Percentage for such
Distribution Date will be zero.
Class B-4 Prepayment Percentage: As to any Distribution Date, except as
set forth in the next sentence, the percentage calculated by multiplying (i) the
Class B Prepayment Percentage by (ii) a fraction, the numerator
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of which is the Class B Subclass Stated Amount of the Class B-4 CitiCertificates
and the denominator of which is the sum of the Class B Subclass Stated Amounts
of the Class B Subclasses (eligible to receive principal distributions for such
Distribution Date in accordance with Section 13.01(d)), each as of the
immediately preceding Distribution Date (after giving effect to any
distributions in reduction of Stated Amount and the allocation of any losses on
such date). In the event that the Class B-4 CitiCertificates are not eligible to
receive distributions of principal in accordance with Section 13.01(d), the
Class B-4 Prepayment Percentage for such Distribution Date will be zero.
Class B-4 Principal Distribution Amount: With respect to any
Distribution Date, the amount distributed in respect of the Class B-4
CitiCertificates pursuant to Paragraph nineteenth of Section 13.01(b).
Class B-4 Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class B-4 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-4 CitiCertificates on prior Distribution Dates pursuant
to Paragraph eighteenth of Section 13.01(b).
Class B-5 Interest Shortfall Amount: As to any Distribution Date, any
amount by which the Class B Subclass Interest Amount of the Class B-5
CitiCertificates with respect to such Distribution Date exceeds the amount
distributed in respect of the Class B-5 CitiCertificates on such Distribution
Date pursuant to Paragraph twentieth of Section 13.01(b).
Class B-5 Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum of:
(i) the Class B-5 Percentage of the applicable Non-PO Percentage of (A)
the principal portion of all Monthly Payments due on the Due Date occurring in
the month of such Distribution Date on each Outstanding Mortgage Loan, less (B)
if the Bankruptcy Coverage Termination Date has occurred, the principal portion
of Debt Service Reductions;
(ii) the Class B-5 Prepayment Percentage of the applicable Non-PO
Percentage of all partial Principal Prepayments received by the Servicer during
the month preceding the month in which such Distribution Date occurs, together
with the Class B-5 Prepayment Percentage of the applicable Non-PO Percentage of
the adjusted Balance of each Mortgage Loan which was subject of a Principal
Prepayment in full during the month preceding the month of such Distribution
Date;
(iii) the Class B-5 Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net Liquidation Proceeds
from each Mortgage Loan which became a Liquidated Loan during the month
preceding the month of such Distribution Date minus any unreimbursed Voluntary
Advances in respect of principal previously made by the Servicer and (2) the
portion of such aggregate Net Liquidation Proceeds allocable to interest;
(iv) the Class B-5 Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was repurchased
by CMSI during such preceding month pursuant to Section 2.03; and
(v) the amount of any recovery in respect of a Realized Loss
allocated to the Class B-5 CitiCertificates pursuant to Section 13.02(d).
Class B-5 Percentage: As to any Distribution Date, except as set forth
in the next sentence, the percentage calculated by multiplying (i) the Class B
Percentage by (ii) a fraction, the numerator of which is the Class B Subclass
Stated Amount of the Class B-5 CitiCertificates and the denominator of which is
the sum of
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the Class B Subclass Stated Amounts of the Class B Subclasses (eligible to
receive principal distributions for such Distribution Date in accordance with
Section 13.01(d)), each as of the immediately preceding Distribution Date (after
giving effect to any distributions in reduction of Stated Amount and the
allocation of any losses on such date). in the event that the Class B-5
CitiCertificates are not eligible to receive distributions of principal in
accordance with Section 13.01(d), the Class B-5 Percentage for such Distribution
Date will be zero.
Class B-5 Prepayment Percentage: As to any Distribution Date, except as
set forth in the next sentence, the percentage calculated by multiplying (i) the
Class B Prepayment Percentage by (ii) a fraction, the numerator of which is the
Class B Subclass Stated Amount of the Class B-5 CitiCertificates and the
denominator of which is the sum of the Class B Subclass Stated Amounts of the
Class B Subclasses (eligible to receive principal distributions for such
Distribution Date in accordance with Section 13.01(d)), each as of the
immediately preceding Distribution Date (after giving effect to any
distributions in reduction of Stated Amount and the allocation of any losses on
such date). In the event that the Class B-5 CitiCertificates are not eligible to
receive distributions of principal in accordance with Section 13.01(d), the
Class B-5 Prepayment Percentage for such Distribution Date will be zero.
Class B-5 Principal Distribution Amount: With respect to any
Distribution Date, the amount distributed in respect of the Class B-5
CitiCertificates pursuant to Paragraph twenty-second of Section 13.0 l(b).
Class B-5 Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class B-5 Interest Shortfall
Amounts for prior Distribution Dates is in excess of the amounts distributed in
respect of the Class B-5 CitiCertificates on prior Distribution Dates pursuant
to Paragraph twenty-first of Section 13.01(b).
Class M Interest Amount: As to any Distribution Date, the amount of
interest accrued during the related Interest Accrual Period at the applicable
Stated Rate on the Class M Stated Amount minus (x) any Non-Supported Interest
Shortfall allocated to the Class M CitiCertificates with respect to such
Distribution Date and (y) the interest portion of any Excess Special Hazard
Losses, Excess Fraud Losses and Excess Bankruptcy Losses allocated to the Class
M CitiCertificates with respect to such Distribution Date pursuant to Section
13.02(e).
Class M Interest Shortfall Amount: As to any Distribution Date, any
amount by which the Class M Interest Amount with respect to such Distribution
Date exceeds the amount distributed in respect of the Class M CitiCertificates
on such Distribution Date pursuant to Paragraph fifth of Section 13.01(b).
Class M Optimal Principal Amount: As to any Distribution Date, an
amount equal to the sum of:
(i) the Class M Percentage of the applicable Non-PO Percentage of (A)
the principal portion of all Monthly Payments due on the Due Date occurring in
the month of such Distribution Date on each Outstanding Mortgage Loan, less (B)
if the Bankruptcy Coverage Termination Date has occurred, the principal portion
of Debt Service Reductions;
(ii) the Class M Prepayment Percentage of the applicable Non-PO
Percentage of all partial Principal Prepayments received by the Servicer during
the month preceding the month in which such Distribution Date occurs, together
with the Class M Prepayment Percentage of the applicable Non-PO Percentage of
the Adjusted Balance of each Mortgage Loan which was subject of a Principal
Prepayment in full during the month preceding the month of such Distribution
Date;
(iii) the Class M Prepayment Percentage of the applicable Non-PO
Percentage of the difference between (1) the aggregate Net Liquidation Proceeds
from each Mortgage Loan which became a Liquidated Loan during the month
preceding the month of such Distribution Date minus any unreimbursed Voluntary
Advances
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in respect of principal previously made by the Servicer and (2) the portion of
such aggregate Net Liquidation Proceeds allocable to interest;
(iv) the Class M Prepayment Percentage of the applicable Non-PO
Percentage of the Adjusted Balance of each Mortgage Loan which was repurchased
by CMSI during such preceding month pursuant to Section 2.03; and
(v) the amount of any recovery in respect of a Realized Loss
allocated to the Class M CitiCertificates pursuant to Section 13.02(d).
Class M Percentage: (a) as to any Distribution Date on which any Class
B Subclass is eligible to receive distributions in reduction of Stated Amount,
the percentage calculated by multiplying (i) the Subordinated Percentage by (ii)
a fraction, the numerator of which is the Class M Stated Amount and the
denominator of which is the sum of the Class M Stated Amount and the Class B
Subclass Stated Amounts of the Class B Subclasses eligible to receive principal
distributions for such Distribution Date in accordance with Section 13.01(d),
each as of the immediately preceding Distribution Date (after giving effect to
any distributions in reduction of Stated Amount and the allocation of any losses
on such date) or (b) on all other Distribution Dates, the Subordinated
Percentage.
Class M Prepayment Percentage: (a) as to any Distribution Date on which
any Class B Subclass is eligible to receive distributions in reduction of Stated
Amount, the percentage calculated by multiplying (i) the Subordinated Prepayment
Percentage by (ii) a fraction, the numerator of which is the Class M Stated
Amount and the denominator of which is the sum of the Class M Stated Amount and
the Class B Subclass Stated Amounts of the Class B Subclasses eligible to
receive principal distributions for such Distribution Date in accordance with
Section 13.01(d), each as of the immediately preceding Distribution Date (after
giving effect to any distributions in reduction of Stated Amount and the
allocation of any losses on such date) or (b) on all other Distribution Dates,
the Subordinated Prepayment Percentage.
Class M Principal Distribution Amount: With respect to any Distribution
Date, the amount distributed in respect of the Class M CitiCertificates pursuant
to Paragraph seventh of Section 13.01(b).
Class M Stated Amount: As of any Distribution Date the lesser of (a)
the Initial Stated Amount of the Class M CitiCertificates less (i) all amounts
previously distributed to holders thereof in reduction of Stated Amount and (ii)
such Class's pro rata share of the Non-PO Percentage of the principal portion of
Excess Special Hazard Losses, Excess Fraud Losses and Excess Bankruptcy Losses
previously allocated to the Class M CitiCertificates and (b) the Pool Adjusted
Balance minus the Class A Stated Amount, each as of the immediately preceding
Distribution Date (after taking into account distributions in reduction of
Stated Amount and the allocation of any Excess Special Hazard Losses, Excess
Fraud Losses and Excess Bankruptcy Losses on such date).
Class M Unpaid Interest Shortfall: As to any Distribution Date, the
amount, if any, by which the aggregate of the Class M Interest Shortfall Amounts
for prior Distribution Dates is in excess of the amounts distributed in respect
of the Class M CitiCertificates on prior Distribution Dates pursuant to
Paragraph sixth of Section 13.01(b).
Class L Regular Interest: The uncertificated Lower-Tier REMIC
regular interest designated as such pursuant to Article XII.
Class LR Certificate: The Lower-Tier REMIC Residual Certificate
designated as such in Article XII.
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Class R Certificate: The Upper-Tier REMIC Residual Certificate
designated as such in Article XII.
Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act and the regulations of the
Commission thereunder. The initial Clearing Agency is as designated in Article
XII.
Clearing Agency Participant: A broker, dealer, bank other financial
institution or other person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
CMSI: Citicorp Mortgage Securities, Inc., a corporation organized and
existing under the laws of the State of Delaware, or its successors in interest.
CMSI Fee: The aggregate amount of Expenses and Servicing Fee.
CMSI Order: A written order or request signed in the name of CMSI by an
Authorized Officer thereof.
Code: The Internal Revenue Code of 1986, as it may be amended from time
to time, any successor statutes thereto, and applicable U.S. Department of the
Treasury temporary or final regulations issued pursuant thereto.
Commission: The Securities and Exchange Commission.
Compensating Cap: With respect to any Distribution Date, the lesser of
(a) the aggregate amount of the Servicing Fee actually received on the Mortgage
Loans for such Distribution Date and (b) the product of (x) 0.125% and (y)
one-twelfth of the Pool Adjusted Balance as of the preceding Distribution Date.
Conduit Certificate Account Advance: With respect to any Distribution
Date, the amount of any Conduit Uncommitted Cash to be distributed to
Certificateholders to cover Remittance Delinquencies related to any CitiMae
Mortgage Loan on such Distribution Date.
Conduit Servicer: Any person with which the Master Servicer has entered
into a Conduit Servicing Agreement and which satisfies the requirements set
forth herein. Each CitiMae Mortgage Loan shall have a Conduit Servicer.
Conduit Servicing Agreement: The written contract between the Master
Servicer and any Conduit Servicer relating to servicing and/or administration of
certain CitiMae Mortgage Loans as provided in Section 3.12.
Conduit Servicing Fee: The amount payable to the Conduit Servicers
pursuant to Section 3.23 hereof.
Conduit Servicing Fee Rate: With respect to any CitiMae Mortgage Loan,
the rate specified as such on Exhibit B-1 hereto under the heading "Sub Fee".
Conduit Subservicer: CitiMae, Inc., a Delaware corporation and wholly
owned subsidiary of Citibank, N.A.
Conduit Subservicer Agreement: The servicing agreement (if any) between
the Master Servicer and the Conduit Subservicer, substantially in the form of
Exhibit D-2 hereto.
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Conduit Trustee Advances: The aggregate of the advances with respect to
the CitiMae Mortgage Loans made by the Trustee pursuant to Section 8.13, and
deposited into the Certificate Account, the amount of any such Conduit Trustee
Advance with respect to a Distribution Date being no more than (a) the aggregate
of Remittances on the CitiMae Mortgage Loans that were due on the preceding Due
Date and delinquent as of the related Determination Date, less (b) the sum of
Voluntary Advances in respect of CitiMae Mortgage Loans and the amount of
Conduit Uncommitted Cash.
Conduit Uncommitted Cash: Any Uncommitted Cash relating to a CitiMae
Mortgage Loan. Corporate Trust Office: The principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of the execution of this Agreement is located at the
address set forth in Article XII.
Custodial Account for P&I: The custodial account for principal and
interest established and maintained as a separate account by each Conduit
Servicer pursuant to its Conduit Servicing Agreement and caused to be
established and maintained by the Conduit Servicer, pursuant to Section 3.03.
Cut-Off Date: As defined in Article XII.
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 or any other similar
state law, except such a reduction constituting a Deficient Valuation.
Deficient Valuation: With respect to any Mortgage Loan, a valuation by
a court of competent jurisdiction of the Mortgaged Property in an amount less
than the then-outstanding indebtedness under the Mortgage Loan, or any reduction
in the amount of principal to be paid in connection with any scheduled Monthly
Payment that results in a permanent forgiveness of principal, which valuation or
reduction results from a proceeding under the Bankruptcy Code, or any other
similar state law.
Definitive Securities: Any Class or Subclass of CitiCertificates, the
Class A-IO Certificates or the Residual Certificates issued in definitive, fully
registered form in accordance with the provisions of Section 5.06 hereof.
Delinquent Amount: As of any Determination Date, an amount equal to (a)
the sum of (i) all Remittance Delinquencies (net of Uncovered Remittance
Delinquencies) as of such date, (ii) the aggregate amount of all previous
Conduit Certificate Account Advances and Affiliated Certificate Account Advances
not vet reimbursed to the Certificate Account and (iii) Net Voluntary Advances
from the Cut-Off Date through such Determination Date, minus (b) the sum of (i)
the Voluntary Advance, if any, for the Distribution Date next following such
Determination Date and (ii) the Conduit Uncommitted Cash and Affiliated
Uncommitted Cash, if any, as of such Determination Date.
Deposit Date: Except as otherwise defined in Article XII, the Business
Day preceding each Distribution Date or if a Certificate Account is held at
Citibank, such Distribution Date.
Depository: The bank or banks (which may be Citibank, N.A. or Citibank
(New York State)) or savings and loan association or associations or trust
company or companies (which may be the Trustee or which may be, directly or
indirectly, controlled by or under common control with CMSI) at which the
Certificate Account, Buydown Account, Escrow Account, Custodial Account for P&I
and Servicing Account are established or maintained pursuant to Section 3.02,
3.03 or 3.15. Each Depository must meet the requirements set forth in Section
11.02,
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Designated Interest Accrual Date: As defined in Article XII.
Determination Date: The date or dates specified in Article XII.
Disqualified Organization: As defined in Section 5.02.
Distribution Date: The date or dates specified in Article XII.
Distribution Date Statement: The statement required to be delivered
pursuant to Section 3.04(f).
Due Date: The first day of each calendar month.
Due Period: With respect to any Determination Date, the period
beginning at the close of business on the first day of the month next preceding
the month of such Determination Date (or, in the case of the Due Period that is
applicable to the first Determination Date, beginning at the close of business
on the Cut-Off Date) and ending at the close of business on the first day of the
month of such Determination Date.
Eligible Account: Either (A) a segregated account or accounts
maintained at Citibank, N.A., provided that the short-term unsecured debt
obligations of Citibank, N.A. are rated at least "A-1" by S&P if S&P is a Rating
Agency, "F-l" by Fitch if Fitch is a Rating Agency, and "P-1" by Moody's if
Moody's is a Rating Agency, or (B) a segregated account or accounts maintained
with an institution whose deposits are insured by the Bank Insurance Fund or the
Savings Association Insurance Fund of the FDIC, the unsecured and
uncollateralized debt obligations of which shall be rated at least in the
category of "AA" by S&P if S&P is a Rating Agency, in the category of "AA" by
Fitch if Fitch is a Rating Agency, and in the category of "AA" by Moody's if
Moody's is a Rating Agency, and which has a short term rating of at least "A-1"
by S&P if S&P is a Rating Agency, "F-1" by Fitch if Fitch is a Rating Agency,
and "P-1" by Moody's if Moody's is a Rating Agency and which is either (i) a
federal savings and loan association duly organized, validly existing and in
good standing under the federal banking laws, (ii) an institution duly
organized, validly existing and in good standing under the applicable banking
laws of any state, (iii) a national banking association duly organized, validly
existing and in good standing under the federal banking laws and (iv) a
principal subsidiary of a bank holding company or (C) a trust account (which
shall be a "special deposit account") maintained with the trust department of a
federal or state chartered depository institution or of a trust company, having
capital and surplus of not less than $50,000,000, acting in its fiduciary
capacity. Any Eligible Accounts maintained with the Trustee shall conform to the
preceding clause (C).
Eligible Investments: Any one or more of the following obligations or
securities:
(i) direct obligations of, and obligations fully guaranteed by, the
United States of America, FHLMC, FNMA, the Farm Credit Banks, the Federal Home
Loan Banks, the Student Loan Marketing Association (but only with respect to
obligations backed by letters of credit or senior obligations) or any agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America; provided,
however, that any obligation of, or guaranteed by, the Federal Home Low Banks or
the Farm Credit Banks or any obligation of. or guaranteed by, FHLMC or FNMA,
other than a senior debt obligation of FHLMC or FNMA or a mortgage participation
or pass-through certificate guaranteed by FHLMC or FNMA, excluding stripped
mortgage securities which are valued greater than par on the portion of unpaid
principal, shall be an Eligible Investment only if, at the time of investment,
such investment is acceptable to each Rating Agency;
(ii) Federal Funds, demand and time deposits in, certificates of
deposits of, or bankers' acceptances issued by, any depository institution or
trust company (including the Trustee or any agent of the Trustee, acting
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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 banking authorities, so long as at the time
of such investment or contractual commitment providing for such investment the
certificate of deposit or other unsecured short-term debt obligations of such
depository institution or trust company have a credit rating of not less than
"A-1"by S&P if S&P is a Rating Agency, "P-1" by Moody's if Moody's is a Rating
Agency, and "F-1" by Fitch if Fitch is a Rating Agency; each such investment
being expressly authorized and deemed authorized by a Certificateholder's
purchase and/or acceptance of any Residual Certificate when acting in the
capacity of a fiduciary (including a "fiduciary" of an "employee benefit plan"
subject to ERISA, as those term are defined in Sections 3(21) and 3(3) of ERISA,
respectively) which purchase and/or acceptance shall also evidence and be deemed
to evidence any such Certificateholder's representation and warranty to CMSI and
the Trustee that such Certificateholder is duly authorized by and empowered
under appropriate governing instruments (for example, an employee benefit plan,
in the case of an ERISA fiduciary) to give such authorization; and money market
funds investing exclusively in any of the investments discussed in this
definition of Eligible Investments with a rating of not less than "A-1" by S&P
if S&P is a Rating Agency, "F-1" by Fitch if Fitch is a Rating Agency and "P-1"
by Moody's if Moody's is a Rating Agency.
(iii) repurchase obligations with respect to (A) any security
described in clause (i) above or (B) any other security issued or guaranteed by
an agency or instrumentality of the United States of America the obligations of
which are backed by the full faith and credit of the United States of America
(collectively, "Eligible Collateral"), in either case where such security has a
remaining maturity of one year or less and where such repurchase obligation has
been entered into with a depository institution or trust company (acting as
principal) with a rating of not less than "A-1" by S&P if S&P is a Rating
Agency, "P-1" by Moody's -if Moody's is a Rating Agency and "F-1" by Fitch if
Fitch is a Rating Agency;
(iv) securities bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America or any
state thereof which have an unsecured long-term debt rating, in the event that
S&P is one of the Rating Agencies, of at least in the category of AA, in the
event that Fitch is one of the Rating Agencies, of at least in the category of
AA and in the event Moody's is one of the Rating Agencies, of at least in the
category of Aa, or an unsecured short-term debt rating, in the event that S&P is
one of the Rating Agencies, of at least A-1, in the event that Fitch is one of
the Rating Agencies, of at least F-1 and in the event Moody's is one of the
Rating Agencies, of at least P-1, at the time of such investment or contractual
commitment providing for such investment; provided, however, that securities
issued by any particular corporation will not be Eligible Investments to the
extent that investment therein will cause the then outstanding principal amount
of securities issued by such corporation and held as part of the Trust Fund to
exceed 10% of the aggregate current Stated Amount of CitiCertificates
Outstanding and of the current Percentage Interest of the Residual Certificates
Outstanding, and the aggregate principal amount of all cash and Eligible
Investments, held in the Trust Fund;
(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 one year after the date of issuance thereof) having at the
time of such investment a rating of not less than "A-1" by S&P if S& P is a
Rating Agency, "F-1" by Fitch if Fitch is a Rating Agency and "P-1" by Moody's
if Moody's is a Rating Agency;
(vi) a Qualified GIC;
(vii) certificates or receipts representing direct ownership interests
in future interest or principal payments on obligations of the United States of
America or its agencies or instrumentalities (which obligations are backed by
the full faith and credit of the United States of America) held by a custodian
on behalf of the holders of such receipts;
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(viii) any other money market deposit, obligation, security or
investment bearing interest or sold at a discount which has an unsecured
short-term debt rating, in the event that S&P is one of the Rating Agencies, of
at least "A-1", in the event that Fitch is one of the Rating Agencies, of at
least "F-1" and, in the event that Moody's is one of the Rating Agencies, of at
least "P-1", or if such investment relates to a money market fund, such fund
must be rated in the highest rating category by each Rating Agency; and
(ix) any other demand or time deposit, obligation, security or
investment bearing interest or sold at a discount as may be acceptable to each
Rating Agency;
provided, that each such Eligible Investment is a "permitted investment" as
defined in Code Section 860G(a)(5).
Eligible Substitute Mortgage Loan: With respect to any Mortgage Loan or
Mortgage Loans included in the Trust Fund for which such Eligible Substitute
Mortgage Loan is being substituted, a Mortgage Loan for which all payments of
principal and interest due on or before the Substitution Day have been received
and which has the following characteristics:
(a) a Mortgage Note Rate equal to or greater than that of such Mortgage
Loan or, if there is more than one such Mortgage Loan, equal to or greater than
the highest Mortgage Note Rate among them;
(b) a date of maturity no later than, and no more than one year
prior to, that of any such Mortgage Loan or Mortgage Loans;
(c)an original term to maturity equal to that of such Mortgage Loan or
Mortgage Loans; and
(d) an aggregate Adjusted Balance, together with any other Eligible
Substitute Mortgage Loans being substituted for such Mortgage Loan or Mortgage
Loans, equal to or greater than that of such Mortgage Loan or Mortgage Loans;
provided, (i) that CMSI may satisfy clause (d) hereof by depositing in the
Certificate Account sufficient funds so that the Adjusted Balance (calculated by
including such funds) of such Eligible Substitute Mortgage Loan satisfies such
clause (the "Substitute Adjustment Amount"), which funds shall be separately
accounted for as a reserve fund in such Certificate Account and will be remitted
to Certificateholders in the month following receipt when such repurchase
proceeds are remitted to compensate for the resulting shortfall incurred in
connection with such substitution of Mortgage Loans and (ii) that the Trustee
shall receive, not later than the Substitution Day, an Opinion of Counsel (who
may not be an employee of CMSI or of an Affiliate of CMSI), dated the
Substitution Day to the effect:
(A) that all documents delivered to the Trustee in connection with such
substitution comply as to form with the requirements of Section 2.04(a);
(B) that all conditions to such substitution specified in Section
2.04(a) have been satisfied;
(C) that the Eligible Substitute Mortgage Loans are "qualified
replacement mortgages" as defined in Code Section 860G(a)(4); and
(D) that the substitution of such Eligible Substitute Mortgage Loans
and the deposit of cash in the Certificate Account, if any, will not constitute
a "prohibited transaction" within the meaning of Code Section 860F(a), will not
adversely affect the status of the Trust Fund as a REMIC and will not otherwise
subject the Trust Fund to any tax.
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ERISA: The applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended from time to time and any applicable rule,
regulation or order promulgated thereunder.
ERISA Prohibited Holder: As defined in Section 5.02.
Escrow Account: The Escrow Account or Accounts established and
maintained as separate accounts by each Conduit Servicer pursuant to its Conduit
Servicing Agreement or otherwise and caused to be established and maintained by
the Master Servicer, pursuant to Section 3.03.
Event of Default: An event described in Section 7.01.
Excess Bankruptcy Loss: Any Bankruptcy Loss, or portion thereof, which
exceeds the then-applicable Bankruptcy Loss Amount.
Excess Fraud Loss: Any Fraud Loss, or portion thereof, which exceeds
the then-applicable Fraud Loss Amount.
Excess Special Hazard Loss: Any Special Hazard Loss, or portion
thereof, that exceeds the then-applicable Special Hazard Loss Amount.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Expense Rate: As to each CitiMae Mortgage Loan, the sum of the
related Conduit Servicing Fee Rate, Master Servicing Fee Rate and the Trustee
Fee Rate.
Expenses: As to each CitiMae Mortgage Loan, the Expense Rate multiplied
by the Adjusted Balance of such CitiMae Mortgage Loan on the Due Date in the
month preceding such Distribution Date.
Extraordinary Event: Any of the following events: (i) hostile or
warlike action in time of peace or war; (ii) the use of any weapon of war
employing atomic fission or radioactive force whether in time of peace or war;
or (iii) insurrection, rebellion, revolution, civil war or any usurped power or
action taken by any governmental authority in preventing such occurrences (but
not including looting or rioting occurring not in time or war).
FDIC: The Federal Deposit Insurance Corporation.
Federal Reserve Bank: The Federal Reserve Bank of New York or successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation.
Fitch: Fitch Investors Service, L.P.
FNMA: The Federal National Mortgage Association.
Foreclosure Profits: As to any Distribution Date, the excess, if any,
of Net Liquidation Proceeds in respect of each Mortgage Loan that became a
Liquidated Loan during the month next preceding the month of such Distribution
Date over the sum of the unpaid principal balance of each such Liquidated Loan
plus accrued and unpaid interest at the applicable Mortgage Note Rate on the
unpaid principal balance thereof from the Due Date to which interest was last
paid by the Mortgagor (or, in the case of a Liquidated Loan that had been an REO
Mortgage Loan, from the Due Date to which interest was last deemed to have been
paid pursuant to Section 3.14) to the first day of the month following the month
in which such Mortgage Loan became a Liquidated Loan.
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Fraud Coverage Termination Date: The Distribution Date upon which the
Fraud Loss Amount has been reduced to zero or a negative number (or the
Subordination Depletion Date, if earlier).
Fraud Loss Amount: As of any Distribution Date after the Cut-Off Date,
an amount equal to: (X) prior to the first anniversary of the Cut-Off Date, an
amount equal to the Initial Fraud Loss Amount minus the aggregate amount of
Fraud Losses since the Cut-Off Date, and (Y) from the first through fifth
anniversary of the Cut-Off Date, an amount equal to (1) the lesser of (a) the
Fraud Loss Amount as of the most recent anniversary of the Cut-Off Date and (b)
1.00% of the Pool Adjusted Balance as of the most recent anniversary of the
Cut-Off Date minus (2) the Fraud Losses since the most recent anniversary of the
Cut-Off Date. After the fifth anniversary of the Cut-Off Date the Fraud Loss
Amount shall be zero.
Fraud Loss: A Liquidated Loan Loss as to which there was fraud
in the origination of such Mortgage Loan.
GIC: A guaranteed investment contract or surety bond.
Group I Non-PO Principal Amount: As specified in Article XII.
Group II Non-PO Principal Amount: As specified in Article XII.
Guide: The CitiMae Sellers' Guide and the CitiMae Servicers' Guide,
being the manual relating to the mortgage loan purchase program of CitiMae,
Inc. as such manual may be amended or supplemented from time to time.
Holder: See Certificateholder.
Independent: When used with respect to any specified Person, means such
a Person who is "independent" within the meaning of Rule 2-01(b) of the
Commission's Regulation S-X under the Exchange Act.
Initial Bankruptcy Loss Amount: As specified in Article XII.
Initial Fraud Loss Amount: As specified in Article XII.
Initial Special Hazard Loss Amount: As specified in Article XII.
Initial Special Hazard Percentage: As specified in Article XII.
Initial Stated Amount: With respect to any Class or Subclass of
CitiCertificates, the amount specified in Article XII, with respect to any
Certificate, the amount specified thereon as the Initial Stated Amount per
Single Certificate multiplied by the number of Single Certificates represented
thereby, as specified in Article XII.
Insurance Proceeds: Proceeds paid in respect of a Mortgage Loan
pursuant to the Primary Mortgage Insurance Certificates, if any, amounts paid
pursuant to the primary hazard insurance policies to the extent not applied to
restore the related Mortgaged Property or released to the Mortgagor in
accordance with CMI's or the Conduit Subservicer's, as applicable, normal
servicing procedures, and amounts paid pursuant to any other insurance policy or
bond relating to the Mortgage Loans or the servicing thereof
Interest Accrual Period: For (x) any Class or Subclass of
CitiCertificates (other than LIBOR CitiCertificates and the Class L Regular
Interest) and the Class A-IO Certificates with respect to any Distribution
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Date, the Standard Accrual Period and (y) any Class or Subclass of LIBOR
CitiCertificates and the Class L Regular Interest with respect to any
Distribution Date, the LIBOR Accrual Period.
Investment Account: As and to the extent specified in Article XII, the
Certificate Account and any other account or any portion if any thereof which
consists of cash or Eligible Investments.
Investment Statement: A written statement prepared by CMSI and setting
forth its calculations made in connection with a determination pursuant to the
first paragraph of Section 3.02(a) with respect to a proposed investment of
funds in the Investment Account.
Investor Rate: As specified in Article XII.
Issue Date: The date on which Certificates are first executed,
authenticated and delivered, as specified in Article XII.
Issuer: CMSI.
Last Scheduled Distribution Date: With respect to each Class or
Subclass of CitiCertificates or Certificates, the date specified in Article XII.
LIBOR Accrual Period. As specified in Article XII.
LIBOR CitiCertificates: As specified in Article XII.
Liquidated Loan: A Mortgage Loan with respect to which the related
Mortgaged Property has been acquired, liquidated or foreclosed and with respect
to which the Servicer or the Master Servicer, as the case may be, determines
that all Liquidation Proceeds which it expects to recover have been recovered or
a Mortgage Loan with respect to which the related Mortgaged Property is retained
or sold by the Mortgagor and for which the Servicer or the Master Servicer, as
the case may be, has accepted payment from the Mortgagor in consideration for
the release of the Mortgage in an amount which is less than the outstanding
principal balance of such Mortgage Loan as a result of a determination by the
Servicer or the Master Servicer, as the case may be, that the potential
Liquidation Expenses with respect to such Mortgage Loan would exceed the amount
by which the cash portion of such payment is less than the outstanding principal
balance of such Mortgage Loan.
Liquidated Loan Loss: With respect to any Distribution Date, the
aggregate of the amount of losses with respect to each Mortgage Loan which
became a Liquidated Loan prior to the Due Date preceding such Distribution Date,
equal to the excess of (i) the unpaid principal balance of each such Liquidated
Loan, plus accrued interest thereon in accordance with the amortization schedule
at the time applicable thereto at the applicable Mortgage Note Rate net, in the
case of the CitiMae Mortgage Loans, the Conduit Servicing Fee from the Due Date
as to which interest was last paid with respect thereto through the last day of
the month in which such Mortgage Loan became a Liquidated Loan, over (ii) Net
Liquidation Proceeds with respect to such Liquidated Loan.
Liquidating Loan: A Mortgage Loan as to which (a) any right of any
person to terminate liquidation proceedings instituted with respect to such
Mortgage Loan by paying delinquent payment and foreclosure costs has expired or
(b) the Servicer (or Subservicer) or the Master Servicer (or Conduit Servicer or
Conduit Subservicer) as has accepted the deed to the property (or, in the case
of cooperative, the related stocks, shares, membership certificates and/or other
documents evidencing ownership thereof) subject to the related Mortgage in lieu
of foreclosure and in whole or partial satisfaction of such Mortgage Loan.
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Liquidation Expenses: With respect to any Liquidated Loan, expenses
paid or incurred by or for the account of the Servicer or the Master Servicer
(or the Subservicer or the Conduit Subservicer), or the Trust Fund for (a)
Property Protection Expenses, (b) property sales expenses, (c) foreclosure
costs, including court costs and reasonable attorneys' fees, (d) similar
expenses reasonably paid or incurred in connection with the liquidation of such
Liquidated Loan, and (e) any tax imposed on the Trust Fund with respect to a
Liquidated Loan or property received by deed in lieu of foreclosure.
Liquidation Proceeds: With regard to any Liquidated Loan, the amounts
received by the Servicer or the Master Servicer, (or the Subservicer or the
Conduit Subservicer) in connection with the liquidation of such Liquidated Loan,
whether through judicial foreclosure, non-judicial foreclosure, proceeds of
insurance policies, condemnation proceeds or otherwise, including payments
received from the Mortgagor in respect of such Liquidated Loan, other than
amounts required to be paid to the Mortgagor pursuant to the terms of such
Liquidated Loan or to be applied otherwise pursuant to law.
Lower-Tier Classes: As defined in Article XII.
Lower-Tier REMIC: As defined in Article XII.
Master Servicer: CMSI, or its successor in interest, or any successor
master servicer appointed as herein provided.
Master Servicing Fee: The amount payable to the Master Servicer
pursuant to Section 3.23 hereof.
Master Servicer Fee Rate: As to any CitiMae Mortgage Loan, .05% per
annum.
Monthly Payment: As to any Mortgage Low (including any REO Mortgage
Loan) and any Due Date, the payment of principal and interest due thereon in
accordance with the amortization schedule at the time applicable thereto (after
such adjustment for any partial Principal Prepayments and Deficient Valuations
occurring prior to such Due Date but before any adjustment to such amortization
schedule other than Deficient Valuations by reason of any bankruptcy, or similar
proceeding or any moratorium or similar waiver or grace period).
Moody's: Moody's Investors Service, Inc.
Mortgage: With respect to any Mortgage Loan, the mortgage or deed of
trust creating a first lien on and an interest (a) in the case of a Mortgage
Loan relating to a cooperative apartment in a cooperative housing corporation,
in the Mortgagor's interest therein securing a Mortgage Note and (b) in other
cases, in real property securing a Mortgage Note.
Mortgage Document Custodial Agreement: The Mortgage Document Custodial
Agreement from time to time in effect between the Mortgage Document Custodian
and the Trustee, substantially in the form of Exhibit C hereto, as the same may
be amended or modified from time to time in accordance with the terms thereof
Mortgage Document Custodian: The Mortgage Document Custodian or
Custodians identified in Article XII or their successors in interest named
pursuant to the Mortgage Document Custodial Agreement as from time to time in
effect. The Mortgage Document Custodian may be CMSI, the Trustee, any Affiliate
of either CMSI or the Trustee or an independent entity.
Mortgage Documents: All documents contained in the Mortgage Files.
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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 such documents pursuant to this Agreement.
Mortgage Loan: At any time, the indebtedness of a Mortgagor evidenced
by a Mortgage Note which is secured by real property (or shares evidencing
ownership interest in a cooperative apartment in a cooperative housing
corporation) and which is sold and assigned to the Trustee and held at such time
in the Trust Fund pursuant to this Agreement, the Mortgage Loans originally so
held being identified in Exhibits B-1 and B-2 hereto.
Mortgage Loan Schedule: The list of Mortgage Loans transferred to the
Trustee as part of the Trust Fund, attached hereto as Exhibits B-1 and B-2.
Mortgage Note: With respect to a Mortgage Loan. the promissory note or
other evidence of indebtedness of the Mortgagor.
Mortgage Note Rate: For a given Mortgage Loan, the annual rate per
annum at which interest accrues on such Mortgage Loan.
Mortgaged Property: Any real property subject to a Mortgage, or any
cooperative apartment in a cooperative housing corporation.
Mortgagor: The obligor on a Mortgage Note.
Net Liquidation Proceeds: For any period, with respect to any
Liquidated Loan the aggregate amount of interest payments, principal payments
and Liquidation Proceeds, net of related Liquidation Expenses and Insurance
Proceeds, received by the Servicer or the Master Servicer or deposited in or the
Certificate Account for distribution to Certificateholders or applied to
reduction of Aggregate Outstanding Advances, as the case may be, with respect to
any such Mortgage Loan, as proceeds of such Mortgage Loan. Net Liquidation
Proceeds shall be allocated first to accrued and unpaid interest on the related
Mortgage Loan (including any applicable Retained Fixed Yield) and then to the
unpaid principal balance thereof
Net Note Rate: As defined in Article XII
Net REO Proceeds: As to any REO Mortgage Loan, REO Proceeds net of any
related expenses of the Servicer.
Net Trustee Advances: For any period, the amount (which may be
negative) obtained by subtracting the amount of any reimbursements with respect
to Trustee Advances received in such period from the aggregate amount of Trustee
Advances made in such period.
Net Advances: For any period, the amount (which may be negative)
obtained by subtracting the amount of any reimbursements with respect to
Voluntary Advances received in such period from the aggregate amount of
Voluntary Advances made in such period.
Non-PO Percentage: As defined in Article XII.
Non-PO Pool Adjusted Balance: With respect to the Mortgage Loans as of
any date, the sum of the product as to each Mortgage Loan of (A) the Non-PO
Percentage for such Mortgage Loan and (B) the Adjusted Balance of such Mortgage
Loan.
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Nonrecoverable Advance: Any portion of a Voluntary Advance previously
made or proposed to be made in respect of a Mortgage Low which has not been
previously reimbursed to the Servicer or Master Servicer and which, in the good
faith judgment of the Servicer or Master Servicer would not be ultimately
recoverable from Liquidation Proceeds or other recoveries in respect of the
related Mortgage Loan. The determination by the Servicer or Master Servicer that
it has made a Nonrecoverable Advance or that any proposed advance, if made,
would constitute a Nonrecoverable Advance, shall be evidenced by a certificate
of a Servicing Officer delivered to the Trustee and detailing the mum for such
determination, but any delay or failure by the Servicer or Master Servicer to
send such Certificate shall not impair the Servicer's night to withhold or
recover such advance. The portion of any Nonrecoverable Advance with respect to
a CitiMae Mortgage Loan which constitutes Retained Fixed Yield will not be
reimbursable to the Servicer from assets in the Trust.
Non-Supported Interest Shortfall: With respect to any Distribution
Date, and any Class or Subclass of CitiCertificates, the pro rata share
allocated thereto based on (in the case of any Class or Subclass of the
CitiCertificates) the amount of interest accrued thereon during the related
Interest Accrual Period at the Stated Rate thereof of the sum of (x) with
respect to the Affiliated Mortgage Loans, the excess, if any, of the Affiliated
Prepayment Interest Shortfall Amount over the Compensating Cap (but not
including any Servicing Fee received because of a Voluntary Advance) and (y)
with respect to the CitiMae Mortgage Loans, the amount by which the CitiMae
Prepayment Interest Shortfall Amount exceeds the Master Servicing Fee for such
period received from the Conduit Servicers. Any Servicing Fee or Master
Servicing Fee advanced by the Servicer will not be applied to reduce either
Affiliated Prepayment Interest Shortfalls or CitiMae Prepayment Interest
Shortfalls.
Officer's Certificate: A certificate signed by an Authorized Officer of
CMSI and delivered to the Trustee.
Opinion of Counsel: A written opinion of counsel, who (unless otherwise
specified herein) may be counsel for, or an employee of, CMSI or an Affiliate of
CMSI, which counsel shall be reasonably acceptable to the Trustee.
Original Class A Stated Amount: As specified in Article XII.
Original Class B-1 Percentage: As specified in Article XII.
Original Class B-1 Stated Amount: As specified in Article XII.
Original Class B-1 Subordination Level: As specified in Article XII
Original Class B-2 Percentage: As specified in Article XII.
Original Class B-2 Stated Amount: As specified in Article XII.
Original Class B-2 Subordination Level: As specified in Article XII
Original Class B-3 Percentage: As specified in Article XII.
Original Class B-3 Stated Amount: As specified in Article XII.
Original Class B-3 Subordination Level: As specified in Article XII
Original Class B-4 Percentage: As specified in Article XII.
Original Class B-4 Stated Amount: As specified in Article XII.
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Original Class B-4 Subordination Level: As specified in Article XII
Original Class B-5 Percentage: As specified in Article XII.
Original Class B-5 Stated Amount: As specified in Article XII.
Original Class B Stated Amount: The sum of the Original Class B-1
Stated Amount, the Original Class B-2 Stated Amount, the Original Class B-3
Stated Amount, the Original Class B-4 Stated Amount and the Original Class B-5
Stated Amount. As specified in Article XII.
Original Class M Percentage: As specified in Article XIII.
Original Class M Stated Amount: As specified in Article XII.
Original Class M Subordination Level: As specified in Article XII.
Original Value: With respect to the Mortgaged Property underlying a
Mortgage Loan, the lesser of the sales price of such Mortgaged Property and the
appraisal value thereof determined pursuant to an appraisal made in connection
with origination of such Mortgage Loan, except that the original appraisal of
such Mortgaged Property may be used for a refinanced Mortgage Loan the unpaid
principal balance of which, after refinancing, does not exceed the unpaid
principal balance of the original mortgage loan at the time of refinancing by an
amount greater than the amount of the closing costs associated with such
refinancing.
Originator: The Affiliate or Affiliates of CMSI from which CMSI is
acquiring the Mortgage Loans.
Outstanding: As of any date, all Certificates theretofore authenticated
and delivered under this Agreement except:
(i) Certificates theretofore canceled by the Certificate Registrar or
delivered to the Certificate Registrar for cancellation;
(ii) CitiCertificates with respect to which money for a distribution in
the necessary amount to reduce the Stated Amount thereof to zero has been
theretofore deposited With the Trustee or any Paying Agent (other than CMSI) in
trust for the Holders of such CitiCertificates; provided, however, that if a
distribution in reduction of the Stated Amount of such CitiCertificates to zero
will be made, notice of such distribution has been duly given pursuant to this
Agreement or provision therefor, satisfactory to the Trustee, has been made;
(iii) Certificates in exchange for or in lieu of which other
Certificates have been authenticated and delivered pursuant to this Agreement
unless proof satisfactory to the Certificate Registrar is presented that any
such Certificates are held by a holder in due course; and
(iv) Certificates alleged to have been destroyed, lost or stolen for
which replacement Certificates have been issued as provided for in Section 5.03
and authorized and delivered pursuant to the Agreement;
provided, however, that in determining whether the Holders of the requisite
percentage of the aggregate Stated Amount or Percentage Interest of any
Outstanding Certificates or of the Outstanding Certificates of any one or more
Classes thereof have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, such percentage shall be based on the
Stated Amount of such Certificate and provided, further, Certificates owned by
CMSI or any other obligor upon the Certificates or any Affiliate of CMSI or such
other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee
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shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent, or waiver, only Certificates which the Trustee knows
to be so owned shall be so disregarded and except that where CMSI or any other
obligor upon the Certificates or any Affiliate of CMSI or such other obligor
shall be owner of 100% of the aggregate Stated Amount or Percentage Interest of
any Outstanding Certificates, CMSI or such other obligor or Affiliate shall be
permitted to give any request, demand, authorization, direction, notice, consent
or waiver hereunder. Certificates so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction of
the Trustee the pledgee's right so to act with respect to such Certificates and
that the pledgee is not CMSI or any other obligor upon the Certificates or any
Affiliate of CMSI or such other obligor.
Outstanding Mortgage Loan: With respect to any Due Date, a Mortgage
Loan which, prior to such Due Date, was not the subject of a Principal
Prepayment in full, did not become a Liquidated Mortgage Loan and was not
purchased pursuant to Sections 2.02 or 2.03.
Pass-Through Rate: With respect to a Mortgage Loan as of any date or
for any period, the applicable Mortgage Note Rate (i) less the Servicing Fee in
the case of an Affiliated Mortgage Loans, or (ii) less the Expense Rate and
Retained Fixed Yield, if any, in the case of CitiMae Mortgage Loans. Any regular
monthly remittance of interest at the Pass-Through Rate for a Mortgage Loan is
based upon annual interest at such rate on the Adjusted Balance as of the first
day of the month of such Mortgage Loan divided by twelve. Interest at the
Pass-Through Rate shall be computed on the basis of a 360-day year, each month
being assumed to have 30 days.
Any partial remittance of interest at such rate by reason of a full
Principal Prepayment is based upon annual interest at such rate on the prepaid
principal balance of the related Mortgage Loan multiplied by a fraction, the
numerator of which is the actual number of days elapsed in the month of such
prepayment to the date of such prepayment and the denominator of which is 360.
With respect to all of the Affiliated Mortgage Loans and some of the CitiMae
Mortgage Loans, the Mortgagors are not required to pay interest on any partial
Principal Prepayments on Mortgage Loans which are received by CMSI during any
calendar month. The amounts required to be paid by CMSI pursuant to Section 3.25
are in addition to any interest payments made by the Mortgagor and passed
through on full and partial prepayments.
Paying Agent: Each paying agent identified in Article XII which is
authorized to make distributions with respect to the Certificates on behalf of
the Trustee. A Paying Agent may be CMSI or an Affiliate of CMSI and, if not CMSI
or an Affiliate of CMSI, must be authorized to exercise corporate trust powers
under the laws of its jurisdiction of organization.
Percentage Interest: With respect to a Class of Residual Certificates,
if the Residual Certificate has a Stated Amount as specified in Article XII, the
Initial Stated Amount of such Residual Certificate (expressed as a percentage)
of the aggregate Initial Stated Amount of the Residual Certificates and, if the
Residual Certificate does not have a Stated Amount, the portion represented by
such Residual Certificate (expressed as a percentage) of the total ownership
interest in the applicable REMIC represented by all Residual Certificates of
such Class. With respect to a Class A-IO Certificates, the portion represented
by such Class A-IO Certificates (expressed as a percentage) of the total
ownership interest in the Lower-Tier REMIC represented by all Class A-IO
Certificates.
Person: Any legal person, including any individual, corporation,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof
Plan: As defined in Section 5.02.
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PO Loss Amount: As defined in Article XII.
PO Percentage: As defined in Article XII.
Pool Adjusted Balance: With respect to the Mortgage Loans as of any
date, the aggregate of the Adjusted Balances of all Mortgage Loans.
Pool Distribution Amount: As of any Distribution Date, the funds
eligible for distribution to the Holders of the Certificates on such
Distribution Date, being all amounts deposited into the Certificate Account, but
excluding the following:
(a) Affiliated Uncommitted Cash and Conduit Uncommitted Cash which will
not be used on such Distribution Date for an Affiliated Certificate Account
Advance or a Conduit Certificate Account Advance;
(b) all permitted withdrawals from the Certificate Account pursuant to
Section 3.16, and
(c) all income from Eligible Investments that are held in an Investment
Account.
Pool Value: Except as otherwise defined in Article XII, as of any
Determination Date or as of the Cut-Off Date, as applicable, with respect to any
Mortgage Loan, the Adjusted Balance of such Mortgage Loan as of the Due Date in
the month in which such Determination Date or Cut-Off Date occurs.
Pooling Agreement: The Pooling Agreement (as defined in the preamble to
this Standard Terms Document) entered into with respect to a particular series
of Certificates and into which this Standard Terms Document is incorporated by
reference.
Predecessor Certificates: With respect to any particular Certificate of
a Class or Subclass, every previous Certificate of that Class or Subclass
evidencing all or a portion of the same Stated Amount or Percentage Interest as
that evidenced by such particular Certificate; and for the purpose of this
definition, any Certificate authenticated and delivered under Section 5.03 in
lieu of a lost, destroyed or stolen Certificate shall be deemed to evidence the
same Stated Amount, notional amount or Percentage Interest, as the case may be,
as the lost, destroyed or stolen Certificate.
Prepaid Installment: With respect to any Mortgage Loan, any installment
of principal thereof and interest thereon received prior to the scheduled Due
Date for such installment, as an early payment thereof and not as a Principal
Prepayment with respect to such Mortgage Loan.
Prepayment Interest Shortfall: As to any Mortgage Loan that was the
subject of a Principal Prepayment applied during the prior calendar month, an
amount equal to the difference between (a) one month of interest on such
Principal Prepayment at the Mortgage Note Rate less in the case of the CitiMae
Mortgage Loans, the Conduit Servicing Fee, if any, on the Adjusted Balance
thereof and (b) the amount of interest, if any with respect to such month that
was actually received from the Mortgagor in connection with such Principal
Prepayment.
Prepayment Principal: With respect to any Distribution Date, the sum of
all amounts that constitute (x) full or partial Principal Prepayments received
in the month preceding the month in which such Distribution Date occurs and (y)
the Adjusted Balance of each Mortgage Loan which, in the month preceding the
month in which the Distribution Date occurs was repurchased pursuant to the
terms of this Pooling Agreement.
Primary Mortgage Insurance Certificate: The certificate of primary
mortgage insurance relating to a particular Mortgage Loan to the extent
initially set forth in the Mortgage Loan Schedule.
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Principal Prepayment: With regard to any particular Mortgage Loan, any
payment of principal on such Mortgage Loan which is received in advance of its
scheduled Due Date and is not accompanied by an amount as to interest
representing scheduled interest for any month subsequent to the month of
prepayment, excluding any proceeds of or advances on any Liquidated Loan.
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Property Protection Expenses: With respect to Mortgage Loans, expenses
paid or incurred by or for the account of CMSI or the Trust Fund in accordance
with the related Mortgages for (a) real estate property taxes and property
repair, replacement protection and preservation expenses and (b) similar
expenses reasonably paid or incurred to preserve or protect the value of such
Mortgages.
Qualified GIC: A GIC, assigned to the Trustee, or entered into by the
Trustee at the direction of CMSI, on or before the Issue Date, providing for the
investment of funds insuring a minimum or fixed rate of return on investments of
such funds, which contract or surety bond shall
(a) be an obligation of an insurance company, trust company, commercial
bank (which may be Citibank or Citibank (New York State)) or other entity whose
credit standing is acceptable to each Rating Agency;
(b) provide that the Trustee may exercise all of the rights of CMSI
under such contract or surety bond without the necessity of the taking of any
action by CMSI;
(c) provide that if at any time (subject to the second proviso of this
paragraph (c)) the then current credit standing of the obligor under such
guaranteed investment contract is such that continued investment pursuant to
such contract of funds included in the Trust Fund would result in a downgrading
of any rating of any Class or Subclass of the CitiCertificates, the Trustee may
terminate such contract and be entitled to the return of all funds previously
invested thereunder, together with accrued interest thereon at the interest rate
provided under such contract through the date of delivery of such funds to the
Trustee, provided that the Trustee shall not be charged with knowledge of any
such potential downgrading unless it shall have received written notice of such
potentiality from the provider of the GIC which must be obligated to give such
notice at least once per year; provided, further, that upon any such event CMSI,
by written notice to the Trustee, may replace such contract with a substitute
GIC having substantially the same terms (including without limitation a rate of
return at least as high as the contract being replaced) so long as such
substitute contract has an obligor with a credit standing no less than the
credit standing of the obligor under the contract to be replaced at the time the
contract was executed and such fact is certified by CMSI to the Trustee;
(d) provide that the Trustee's interest therein shall be transferable
to any successor trustee hereunder;
(e) provide that the funds invested thereunder and accrued interest
thereon be available not later than the day prior to any Distribution Date on
which such funds may be required for distribution hereunder; and
(f) meet such other standards as may be specified in Article XII.
Qualified Nominee: A Person (who may not be CMSI or an Affiliate of
CMSI) in whose name Eligible Investments held by the Trustee hereunder may be
registered as nominee of the Trustee in lieu of registration in the name of the
Trustee, provided that the following conditions shall be satisfied in connection
with such registration:
(a) the instruments governing the creation and operation of the nominee
provide that neither the nominee nor any owner of an interest in the nominee
(other than the Trustee) shall have any interest, beneficial
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or otherwise, in any Eligible Investments at any time held in the name of the
nominee, except for the purpose of transferring and holding legal title thereto;
(b) the nominee and the Trustee have entered into a binding agreement
in substantially the form to be provided by CMSI establishing that any Eligible
Investments held in the name of the nominee are to be held by the nominee as
agent (other than commission agent or broker) or nominee for the account of the
Trustee; and
(c) in connection with the registration of any Eligible Investment in
the name of the nominee, all requirements under applicable governmental
regulations necessary to effect a valid registration of transfer of such
Eligible Investment are complied with as evidenced to the Trustee upon its
request by an Opinion of Counsel.
Rating Agencies: The nationally recognized statistical rating
organization(s) identified in Article XII.
Realized Losses: With respect to any Distribution Date, Liquidated Loan
Losses (including Special Hazard Losses and Fraud Losses) and Bankruptcy Losses
incurred in the month preceding the month of such Distribution Date.
Record Date: As defined in Article XII.
Reimbursable Class A Non-PO Losses: An amount of principal allocated to
the Class A CitiCertificates (other than the Class A-9 CitiCertificates)
pursuant to Section 13.02.
Reimbursable Class A PO Losses: An amount of principal allocated to the
Class A-9 CitiCertificates pursuant to Section 13.02.
Reimbursable Class B Losses: An amount of principal allocated to the
Class B CitiCertificates pursuant to Section 13.02.
Reimbursable Class M Losses: An amount of principal allocated to the
Class M CitiCertificates pursuant to Section 13.02.
REMIC: A "real estate mortgage investment conduit" within the meaning
of Code Section 860D. References to "a REMIC" are to the REMICs constituted by
the Trust Fund.
REMIC Provisions: The provisions of the federal income tax law relating
to REMICs, which appear at Sections 860A through 860G of the Code, and related
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.
Remittance Delinquencies: With respect to any Determination Date, the
aggregate of the originally scheduled interest (which in the case of a Buydown
Mortgage Loan shall be deemed to be no less than the amount of accrued and
unpaid interest at die related Mortgage Note Rate) less, in the case of the
CitiMae Mortgage Loans, the aggregate amount of Conduit Servicing Fees and
principal installments (as adjusted for any Principal Prepayments) on Mortgage
Loans due from and payable by the Mortgagors (or, in the case of a Buydown
Mortgage Loan, the related Buydown Account) on (but not before) the Due Date
next preceding such Determination Date but not paid on or before such
Determination Date.
Remittances: All payments listed in Sections 3.03 and 3.14 which are
received by the Trust Fund with respect to Mortgage Loans.
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REO Mortgage Loan: Any Mortgage Loan which is not a Liquidated Loan and
as to which the related Mortgaged Property is held as part of the Trust Fund.
REO Proceeds: Proceeds, net of any related expenses of CMSI received in
respect of any REO Mortgage Loan (including, without limitation, proceeds from
the rental of the related Mortgaged Property).
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan or otherwise treated as having been acquired pursuant to the REMIC
Provisions.
Report Date: As defined in Section 3.09.
Required Amount of Certificates: (i) 66 2/3% or more of the aggregate
Voting Interest of the outstanding CitiCertificates if affected by the
occurrence of any Event of Default, (ii) 66 2/3% or more of the aggregate
Outstanding Percentage Interest of the Residual Certificates, if affected by
such an Event of Default and (iii) 66 2/3% or more of the aggregate Outstanding
Voting Interest of the Class A-IO Certificates, if affected by such an Event of
Default.
Residual Certificate: Residual Certificate has the meaning stated in
the first paragraph of Article XII.
Responsible Officer: With regard to any Person, the Chairman or any
Vice Chairman of the Board of Directors or Trustees, the Chairman or Vice
Chairman of the Executive or Standing Committee of the Board of Directors or
Trustees, the President, the Chairman of the committee on trust matters, any
executive vice president, senior vice president, first vice president, second
vice president, vice president, any assistant vice president, the Secretary, any
assistant secretary, the Treasurer, any assistant treasurer, the Cashier, any
assistant or deputy cashier, any trust officer or assistant trust officer, the
Controller and any assistant controller or any other officer of such Person
customarily performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular matter, any other
officer of such Person to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject; provided, however,
that in respect of the Trustee, "Responsible Officer" shall only mean any such
officer who is employed in the Corporate Trust Department or a similar group for
the Trustee.
S&P: Standard and Poor's Ratings Group, a division of McGraw Hill, Inc.
Servicer: CMSI, or its successor in interest, or any successor servicer
appointed as herein provided.
Servicing Account: The account, if any, created and maintained pursuant
to Section 3.15.
Servicing Fee: As defined in Article XII.
Servicing Officer: Any officer of CMSI any Subservicer or Conduit
Subservicer involved in, or responsible for, the administration and servicing of
the Trust Fund whose name appears on a list of servicing officers attached to an
Officer's Certificate furnished to the Trustee by CMSI, as such list may from
time to time be amended.
Similar Law: As defined in Section 5.02.
Single Certificate: As set forth in Article XII.
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Special Hazard Loss: (i) A Liquidated Loan Loss suffered by a Mortgaged
Property on account of direct physical loss, exclusive of (a) any loss covered
by a hazard policy or a flood insurance policy maintained in respect of such
Mortgaged Property pursuant to Section 3.18 and (b) any loss caused by or
resulting from:
(1) normal wear and tear;
(2) infidelity, conversion or other dishonest act on the part of
the Trustee, the Servicer or any of their agents or employees; or
(3) errors in design, faulty workmanship or faulty materials,
unless the collapse of the property or a part thereof ensues;
or, (ii) any Liquidated Loan Loss suffered by the Trust Fund arising from or
related to the presence or suspected presence of hazardous wastes or hazardous
substances on a Mortgaged Property unless such loss to a Mortgaged Property is
covered by a hazard policy or a flood insurance policy maintained in respect of
such Mortgaged Property pursuant to Section 3.18.
Special Hazard Loss Amount: As of any Distribution Date, an amount
equal to the Initial Special Hazard Loss Amount minus the sum of (i) the
aggregate amount of Special Hazard Losses and (ii) the Adjustment Amount (as
defined below) as most recently calculated. For each anniversary of the Cut-Off
Date, the Adjustment Amount shall be calculated and shall be equal to the
amount, if any, by which the amount calculated in accordance with the preceding
sentence (without giving effect to the deduction of the Adjustment Amount for
such anniversary) exceeds the greater of (A) the product of the Special Hazard
Percentage for such anniversary multiplied by the Pool Adjusted Balance on the
Distribution Date immediately preceding such anniversary and (B) twice the
Adjusted Balance of the Mortgage Loan in the Trust Fund which has the largest
Adjusted Balance on the Distribution Date immediately preceding such
anniversary.
Special Hazard Percentage: As of each anniversary of the Cut-Off Date,
the greater of (i) 1.00% and (ii) the largest percentage obtained by dividing
the aggregate Adjusted Balances (as of the immediately preceding Distribution
Date) of the Mortgage Loans secured by Mortgaged Properties located in a single,
five-digit ZIP code area in the State of California by the Pool Adjusted Balance
of all the Mortgage Loans as of such anniversary.
Special Hazard Termination Date: The Distribution Date upon which the
Special Hazard Loss Amount has been reduced to zero or a negative number (or the
Subordination Depletion Date, if earlier).
Spread: With respect to any Distribution Date, the difference between
(a) the sum of
(i) the total amount of Remittances received during the preceding
Due Period,
(ii) in the case of the first Due Period, the amount, if any,
deposited by CMSI in the Certificate Account on the Issue Date,
(iii) to the extent all or any portion of the Certificate Account
is designated as an Investment Account, the aggregate reinvestment
income earned in such Investment Account
(A) on each of the amounts described in the foregoing clauses (i) and
(ii) (from the Deposit Date or from the day on which such funds are deposited in
the Investment Account, as the case may be. in the case of
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Remittances with respect to Mortgage Loans pursuant to clause (i) above, from
the Issue Date, in the case of the amount described in clause (ii) above)
(I) received through the close of business on the Determination
Date in such Due Period, and
(II) receivable thereafter but before such Distribution Date
(or on such Distribution Date in the case of any investment which may mature on
such Distribution Date) in the case of any such amount invested in investments
scheduled to mature after the Determination Date in such Due Period and
(B) on each of the amounts described in the foregoing clauses (1)
through (111), at the Assumed Reinvestment Rate, from
(I) the first Business Day following such Determination Date, in
the case of any cash in such Investment Account at the close of
business on the Determination Date in such Due Period,
(II) the date funds are required to be deposited in such
Investment Account. if such deposit date is after the Determination
Date in such Due Period, or
(III) the scheduled maturity date of any investment in such
Investment Account scheduled to mature after the Determination Date
in such Due Period, in any case to but excluding the last Business
Day prior to the related Distribution Date, and
(b) the sum of
(i) the amount of interest accrued in respect of the
CitiCertificates then Outstanding during the preceding Interest
Accrual Period, whether or not required to be distributed,
(ii) the sum of the Class A Stated Amount, the Class M Stated
Amount and the Class B Amount, and
(iii) all fees payable pursuant to Section 3.04(c) with respect
to the related Due Period.
Spread Percentage: As defined in Article XII.
Standard Accrual Period: As defined in Article XII.
Startup Day: As defined in Article XII
Stated Amount: On any Distribution Date,
(i) with respect to a Class A CitiCertificate of any Subclass, its pro
rata share based on the Initial Stated Amount of the applicable Class A Subclass
Stated Amount;
(ii) with respect to a Class M CitiCertificate, its pro rata share
based on the Initial Stated Amount of the Class M CitiCertificates and
(iii) with respect to a Class B CitiCertificate of any Subclass, its
pro rata share based on the Initial Stated Amount of the applicable Class B
Subclass Stated Amount.
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Stated Rate: With respect to any Class or Subclass of CitiCertificates
or Certificates, the rate per annum, at which interest accrues on Certificates
of such Class or such Subclass, as specified in Article XII.
Subclass: With respect to a Class of CitiCertificates, any group of
such Class designated as a Subclass in Article XII.
Subordinated CitiCertificates: The Class M and Class B
CitiCertificates.
Subordinated CitiCertificate Percentage: With respect to any
Distribution Date, 100% less the Class A Percentage.
Subordinated Prepayment Percentage: With respect to any Distribution
Date, the difference between 100% and the Class A Prepayment Percentage for such
date.
Subordination Depletion Date: The first Distribution Date on which the
Stated Amount of the Subordinated CitiCertificates has been reduced to zero.
Subservicer: Any person or persons to which CMSI may delegate its
servicing obligations hereunder pursuant to Section 6.06.
Subservicing Agreement: The Subservicing Agreement between CMSI and
the Subservicer, substantially in the form of Exhibit D hereto.
Substitution Adjustment Amount: The meaning ascribed to such term in
the definition of Eligible Substitute Mortgage Loan.
Substitution Day: As defined in Section 2.04.
Transfer Instrument: A deed transferring an interest in property
subject to a mortgage.
Trustee Advances: The aggregate amount of Affiliated Trustee Advances
and Conduit Trustee Advances.
Trustee Fee: The amount accrued for fees payable to the Trustee in
respect of the CitiMae Mortgage Loans.
Trustee Fee Rate: With respect to any CitiMae Mortgage Loan, .01% pern
interest, or any annum.
Trust Fund: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans, the Certificate Account, any reinvestment
income earned on funds in an Investment Account, REO Property and the Primary
Mortgage Insurance Certificates and any other insurance policies with respect to
the Mortgage Loans.
Trustee: The Person executing this Agreement as Trustee, or its
successor in interest, or any successor trustee appointed as herein provided.
Trustee Failure: As to any Distribution Date, the failure of the
Trustee to deposit an Affiliated Trustee Advance or Conduit Trustee Advance in
the Certificate Account as required under Section 8.13.
Trustee Failure Advance: As to any Distribution Date subsequent to the
Advance Account Funding Date, the amount, if any, required to be deposited in
the Certificate Account from amounts withdrawn from the Advance Account on
account of a Trustee Failure, which amount is equal to the lesser of (i) the
amount of any Conduit
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Trustee Advance or Affiliated Trustee Advance required to be made by the Trustee
with respect to such Distribution Date but not made, and (ii) the then
applicable Advance Account Available Advance Amount.
Uncommitted Cash: As of any Determination Date, any cash in the
Certificate Account representing Principal Prepayments posted or Liquidation
Proceeds deposited on or after the Due Date immediately preceding such
Determination Date and all related payments of interest and all payments which
represent earl y receipt of scheduled payments of principal and interest due on
a date or dates subsequent to such Due Date.
Uncovered Remittance Delinquency: Any Remittance Delinquency
determined by the Servicer to be the result of the occurrence of an
Extraordinary Event (but not including a Remittance Delinquency determined by
the Servicer to be eligible for an advance pursuant to Section 3.03 (g)).
Unpaid PO Loss Amount: As defined in Article XII.
Underwriter: Donaldson, Lufkin & Jenrette Securities Corporation, or
its successor-in-interest.
Upper-Tier Certificates: As specified in Article XII.
Upper-Tier REMIC: As defined in Article XII.
Upper-Tier REMIC Account: The account or accounts established (in the
same manner as the Certificate Account is established) and maintained pursuant
to Section 3.28.
U.S. Person: A citizen or resident of the United States of America, a
corporation, partnership or other entity created or organized in or under the
laws of the United States of America or any political subdivision thereof, an
estate that is subject to U.S. federal income tax regardless of the source of
its income or a trust if (A) for taxable years beginning after December 31, 1996
(or for taxable years ending August 20, 1996, if the trust has made an
applicable election), a court within the United States is able to exercise
primary supervision over the administration of such trust, and one or more
United States fiduciaries have the authority to control all substantial
decisions of such trust, or (B) for all other taxable years, such trust is
subject to United States federal income tax regardless of the source of its
income.
Voluntary Advance: The aggregate of the advances made by the Servicer
or Master Servicer, and deposited into the Certificate Account pursuant to the
Agreement, the amount of any such Voluntary Advance with respect to a
Distribution Date being no more than (a) the aggregate of Remittances on the
Mortgage Loans that were due on the preceding Due Date and delinquent as of the
related Determination Date, after adjustment of delinquent interest payments to
interest at the Mortgage Note Rate less, in the case of the CitiMae Mortgage
Loans, the Conduit Servicing Fee Rate and plus the amount of any Affiliated
Certificate Account Advance and Conduit Certificate Account Advance with respect
to the preceding Distribution Date, less (b) the amounts to be used to make an
Affiliated Certificate Account Advance and Conduit Certificate Account Advance
on the next succeeding Distribution Date.
Voting Interest: As of any date, the Voting Interest of the Class A
CitiCertificates shall equal the sum of (i) (100% minus the Class A-3 Voting
Interest) multiplied by a fraction the numerator of which is the Class A Stated
Amount and the denominator of which is the sum of the Class A Stated Amount, the
Class M Stated Amount and the Class B Stated Amount and (ii) the Class A-3
Voting Interest. As of any date the Voting Interest of the Class M
CitiCertificates will equal (a) 100% minus the Class A Voting Interest
multiplied by (b) a fraction the numerator of which is the Class M Stated Amount
and the denominator of which is the sum of the Class M Stated Amount and the
Class B Stated Amount. As of any date the Voting Interest of the Class B
CitiCertificates will equal 100% less the sum of the Voting Interest of the
Class A and Class M CitiCertificates.
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The Voting Interest of the Class A CitiCertificates (other than the Class A-3
CitiCertificates) and the Class B CitiCertificates will be allocated among the
Subclasses of the Class A or Class B CitiCertificates, as the case may be, pro
rata based on each such Subclass' Stated Amount. The Voting Interest of the
Class A-IO Certificates shall be 100%.
Section 1.02. Calculations Respecting Mortgage Loans.
(a) In connection with all calculations required to be made pursuant to
this Agreement with respect to Remittances on any Mortgage Loan, any payments on
the Mortgage Loans or any payments on any other assets included in a Trust Fund,
the rules set forth in this Section 1.02 shall be applied.
(b) Calculations with respect to Remittances on Mortgage Loans shall be
made on a mortgage-loan-by-mortgage-loan basis, based upon current information
as to the terms of such Mortgage Loans and reports of payments received on such
Mortgage Loans supplied to CMSI by the Person responsible for the servicing
thereof and satisfying such requirement, if any, as may be set forth in Section
3.21.
(c) Each Remittance receivable with respect to a Mortgage Loan shall
be assumed to be received on the Due Date.
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ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. Conveyance of Trust Fund. CMSI, concurrently with the
execution and delivery of this Agreement, does hereby transfer, assign, set over
and otherwise convey to the Trustee without recourse all the right, title and
interest of CMSI in and to the Trust Fund, including without limitation all of
the right, title and interest of CMSI in the Mortgage Loans, including all
Remittances received or receivable by CMSI on or with respect to the Mortgage
Loans (other than payments of principal and interest due and payable on the
Mortgage Loans, and Principal Prepayments thereon received, on or before the
Cut-Off Date and any Retained Fixed Yield Amounts), together with all of its
right, title and interest in and to the proceeds of any title, hazard or other
insurance policies, or Primary Mortgage Insurance Certificates related to such
Mortgage Loans. The transfer of the Mortgage Loans accomplished hereby is
absolute and is intended by the parties hereto as a sale. CMSI shall not
transfer any property to the Trust Fund except as otherwise expressly permitted
by this Agreement.
(a) In connection with such transfer and assignment of Mortgage Loans
(other than Mortgage Loans secured by shares in a cooperative housing
corporation), CMSI does herewith deliver to the Trustee (or a custodian) to be
held in trust the following documents or instruments with respect to each
Mortgage Loan so transferred and assigned (except where, and to the extent, CMSI
is complying with Section 2.01(c)):
(i) The Mortgage Note, endorsed by manual or facsimile
signature without recourse by the Originator or an Affiliate of the
Originator in blank or to the Trustee showing a complete chain of
endorsements from the named payee to the Trustee or from the named
payee to the Affiliate of the Originator and from such Affiliate to
the Trustee;
(ii) The original recorded Mortgage, with evidence of recording
thereon or a copy of the Mortgage certified by the public recording
office in those jurisdictions where the public recording office
retains the original;
(iii) Any original assumption, modification, buydown or
conversion-to-fixed-interest-rate agreement applicable to the
Mortgage;
(iv) An assignment from the Originator or an Affiliate of the
Originator to the Trustee in recordable form of the Mortgage which
may be included, where permitted by local law, in a blanket
assignment or assignments of the Mortgage to the Trustee, including
any intervening assignments and showing a complete chain of title
from the original mortgagee named under the Mortgage to the
Originator or an Affiliate of the Originator and to the Trustee;
(v) The original or a copy of the title insurance policy (which
may be a certificate or a short form policy relating to a master
policy of tide insurance) pertaining to the Mortgaged Property, or
in the event such original title policy is unavailable, a copy of
the preliminary title report and the lender's recording
instructions, with the original to be delivered within 180 days of
the Closing Date or other evidence of title; and
(vi) Any related Primary Mortgage Insurance Certificate and
related policy or a copy thereof
(b) In connection with the transfer and assignment of Mortgage Loans
secured by shares in a cooperative housing corporation, CMSI does herewith
deliver to the Trustee ( or a custodian) to be held in trust the following
documents or instruments with respect to each Mortgage Loan secured by shares in
a cooperative
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housing corporation so transferred and assigned (except where, and to the
extent, CMSI is complying with Section 2.01(c)):
The Mortgage Note, endorsed by manual or facsimile signature without
recourse by the Originator or an Affiliate of the Originator in blank or to the
Trustee showing a complete chain of endorsements and assignments from the named
payee to the Trustee or from the named payee to the Affiliate of the Originator
and from such Affiliate to the Trustee;
(ii) The original Mortgage, with evidence of recording thereon
(if recordation was required under applicable law);
(iii) Any original assumption, modification, buydown or
conversion-to-fixed-interest-rate agreement applicable to the
Mortgage;
(iv) The original stocks, shares, membership certificate or
other contractual agreement evidencing ownership;
(v) The original stock power executed in blank;
(vi) The original executed security agreement or similar
document and all assignments thereof showing a complete chain of
assignment from the named secured party to the Trustee;
(vii) The original executed proprietary lease or occupancy
agreement and all assignments thereof showing a complete chain of
assignment from the named secured party to the Trustee;
(viii) The original executed recognition agreement and all
executed assignments of recognition agreement showing a complete
chain of assignment from the named secured party to the Trustee;
(ix) (Except for Mortgage Loans (x) secured by Mortgaged
Properties in the State of New Jersey or (y) originated prior to
October 1988 and secured by Mortgaged Properties in the State of
New York) the executed UCC-1 financing statement with evidence of
recording thereon and executed original UCC-3 financing statements
or other appropriate UCC financing statements required by state
law, evidencing a complete and unbroken chain from the mortgagee
to the Trustee with evidence of recording thereon (or in a form
suitable for recordation); and
(x) Any related Primary Mortgage Insurance Certificate and
related policy.
In addition, CMSI, concurrently with the execution and delivery of this
Agreement and in connection with such transfer and assignment of Mortgage Loans
shall deposit in the Certificate Account the amount of all payments received by
CMSI after the Cut-Off Date and prior to the Issue Date with respect to the
Mortgage Loans, to the extent such payments are being transferred and assigned
to the Trustee hereunder, except any portion of such payments on Mortgage Loans
(including servicing fees with respect thereto) of a type not required to be
deposited therein as specified in Article XI or Article XII.
(c) In instances where an original recorded Mortgage cannot be
delivered by CMSI to the Trustee prior to or concurrently with the execution and
delivery of this Agreement, due to a delay in connection with the recording of
such Mortgage, CMSI may, (a) in lieu of delivering such original recorded
Mortgage referred to in clause (a)(ii) or (b)(ii) above, deliver to the Trustee
a copy thereof, provided that CMSI certifies that the original Mortgage has been
delivered to a title insurance company for recordation after receipt of its
policy of title
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insurance or binder therefor (which may be a certificate relating to a master
policy of title insurance), and (b) in lieu of delivering the completed
assignment in recordable form referred to in clause (a)(iv) or (b)(ii) and
(b)(ix) above to the Trustee, deliver such assignment to the Trustee completed
except for recording information. In all such instances, CMSI will deliver the
original recorded Mortgage and completed assignment (if applicable) to the
Trustee promptly upon receipt of such Mortgage. In instances where an original
recorded Mortgage has been lost or misplaced, CMSI or the related title
insurance company may deliver, in lieu of such Mortgage, a copy of such Mortgage
bearing recordation information and certified as true and correct by the office
in which recordation thereof was made. In instances where the original or a copy
of the title insurance policy referred to in clause (a)(v) above (which may be a
certificate relating to a master policy of title insurance) pertaining to the
Mortgaged Property relating to a Mortgage Loan cannot be delivered by CMSI to
the Trustee prior to or concurrently with the execution and delivery of this
Agreement because such policy is not yet available, CMSI may. in lieu of
delivering the original or a copy of such title insurance referred to in clause
(a)(v) above, deliver to the Trustee a binder with respect to such policy (which
may be a certificate relating to a master policy of title insurance) and deliver
the original or a copy of such policy (which may be a certificate relating to a
master policy of title insurance) to the Trustee when available, In instances
where an original assumption, modification, buydown or
conversion-to-fixed-interest-rate agreement cannot be delivered by CMSI to the
Trustee prior to or concurrently with the execution and delivery of this
Agreement, CMSI may, in lieu of delivering the original of such agreement
referred to in clause (a)(iii) or (b)(iii) above, deliver a certified copy
thereof CMSI will deliver the original assumption, modification, buydown or
conversion-to-fixed-interest-rate agreement to the Trustee promptly upon receipt
thereof
CMSI agrees, at its own expense, to prepare and record (or to supply
the Trustee with evidence of recordation of) each assignment referred to in
clause (a)(vi) or (b)(vi) and (b)(ix) above. CMSI shall prepare and deliver a
copy of each such assignment to the Trustee as soon as practicable but not later
than 60 days after the date of initial issuance of the CitiCertificates, and
CMSI intends to effect such recordation as soon as practicable thereafter in the
appropriate public office for real property records except that CMSI need not
cause to be recorded any assignment which relates to a Mortgage Loan for which
the Mortgaged Property is located in a jurisdiction under the laws of which, on
the basis of an Opinion of Counsel delivered to the Trustee which is reasonably
satisfactory to the Trustee, recordation of such assignment is not necessary to
protect the Trustee and the Certificateholders' interest in the related Mortgage
Loan or Mortgage.
CMSI agrees, at its own expense, to record any UCC-3 financing
statements not previously recorded (and to supply the Trustee with evidence of
such recordation). CMSI intends to effect such recordation as soon as
practicable after the date of initial issuance of the CitiCertificates in the
appropriate public office.
In the case of Mortgage Loans which have been prepaid in full after the
Cut-Off Date and prior to the date of execution and delivery of this Agreement,
CMSI, in lieu of delivering the above documents to the Trustee, herewith
delivers to the Trustee a certification of a Servicing Officer as set forth in
Section 3.22
In connection with such transfer and delivery of the balance of the
Trust Fund, CMSI, concurrently with the execution and delivery of this
Agreement, shall deposit into the Certificate Account cash in the amount (if
any) specified in Article XII.
Section 2.02. Acceptance by Trustee. The Trustee, by execution and
delivery hereof, acknowledges receipt, subject to the review described in the
succeeding sentence, of the documents and other property referred to in Section
2.01 and declares that the Trustee holds and will hold such documents and other
property, including property yet to be received in the Trust Fund, in trust,
upon the trusts herein set forth, for the benefit of all present and future
Certificateholders. The Trustee agrees, for the benefit of such
Certificateholders, to review each Mortgage File within 90 days after execution
and delivery of this Agreement, to ascertain that all required documents have
been executed, received and recorded, if applicable, and that such documents
relate to the
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Mortgage Loans identified in Exhibit B-1 and B-2 hereto. If in the course of
such review the Trustee finds a document or documents constituting a part of a
Mortgage File to be defective in any material respect, the Trustee shall
promptly so notify CMSI, whereupon CMSI shall have a period of 180 days within
which to correct or cure any such defect (including correction or cure by
substitution of Mortgage Loans to the extent permitted by Section 2.04). If any
such material defect has not been corrected or cured, CMSI will, not later than
180 days after the Trustees notice respecting such defect, repurchase the
related Mortgage Loan from the Trustee at a price equal to (I) 100% of the
Adjusted Balance on such Mortgage Loan, after taking into account any principal
payable thereon on the Due Date in the month of repurchase, plus (ii) accrued
and unpaid interest thereon at the Mortgage Note Rate less in the case of the
CitiMae Mortgage Loan, the applicable Expense Rate and the Retained Fixed Yield,
if any, to the first day of the month in which proceeds of such repurchase are
distributed to the Certificateholders, plus (iii) any unreimbursed payments with
respect to such Mortgage Loan, to the extent not covered in (ii) above, as part
of a Voluntary Advance, a Trustee Advance or an Advance Account Advance
whereupon all Voluntary Advances, Trustee Advances and Advance Account Advances
will be reimbursed to the Trustee or deemed reimbursed to CMSI, as the case may
be, with respect to such Mortgage Loan by such respective amounts.
Notwithstanding the preceding two sentences, any material defect that causes a
Mortgage Loan to fail to constitute a "qualified mortgage" within the meaning of
Code Section 860G(a)(3) shall either be corrected or cured by CMSI or, failing
such correction or cure, CMSI shall repurchase such Mortgage Loan at the price
described in the preceding sentence (or, if within two years of the Startup Day,
or such other period as may be permitted by the REMIC Provisions, substitute an
Eligible Substitute Mortgage Loan therefor pursuant to Section 2.04) no later
than 90 days after the discovery of such material defect. Any such repurchase
shall be considered a prepayment in full of such Mortgage Loan on such Due Date
and shall be deposited (net of reimbursed Voluntary Advances, Trustee Advances
and Advance Account Advances) by CMSI in the Certificate Account and, upon
receipt by the Trustee of written notification of such deposit signed by an
Authorized Officer of CMSI, the Trustee shall release to CMSI the related
Mortgage File and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, as CMSI shall reasonably request, to
vest in CMSI any Mortgage Low released pursuant hereto. Any repurchase by CMSI
of a Mortgage Loan hereunder shall be deemed to include the right to receive any
Remittance thereon payable after the month of repurchase, and the Trustee shall,
upon receipt of any such Remittance, promptly remit the amount of such
Remittance to CMSI. It is understood and agreed that the obligation of CMSI to
repurchase any Mortgage Loan or make a substitution therefor pursuant to Section
2.04 as to which a material defect in a constituent document exists shall
constitute the sole remedy against CMSI with respect to such defect available to
the Certificateholders or the Trustee on behalf of the Certificateholders.
The Trustee may, concurrently with the execution and delivery hereof or
at any time thereafter, enter into a Mortgage Document Custodial Agreement
substantially in the form of Exhibit C hereto pursuant to which the Trustee
appoints a Mortgage Document Custodian to hold the Mortgage Documents in trust
for the Trustee and the benefit of the Trustee and all present and future
Certificateholders, which may provide that the Mortgage Document Custodian shall
conduct the review of each Mortgage File required under the first paragraph of
this Section 2.02, provided that, if the Mortgage Document Custodian so
appointed is CMSI or an Affiliate of CMSI, the Trustee shall conduct such
review.
Section 2.03. Representations and Warranties of CMSI. CMSI hereby
represents and warrants to the Trustee that:
(i) The information set forth in Exhibit B hereto was true and
correct in all material respects as of the date or dates respecting which such
information is furnished;
(ii) As of the Issue Date, each Mortgage will be a valid first
lien on the property securing the related Mortgage Note subject only to (a) the
lien of current real property taxes and assessments as limited in clause (vi)
below, (b) covenants, conditions and restrictions, rights of way, easements and
other matters of
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public record as of the date of recording of such Mortgage, such exceptions
appearing of record being acceptable to mortgage lending institutions generally
or specifically reflected in the appraisal obtained in connection with the
origination of the related Mortgage Loan, (c) other matters to which like
properties are commonly subject which do not in the aggregate materially
interfere with the benefits of the security intended to be provided by such
Mortgage and (d) in addition, in the case of a Mortgage on a cooperative
apartment in a cooperative housing corporation, the right of the related
cooperative to cancel the related shares and terminate the proprietary lease for
unpaid assessments (general and special) owed by the Mortgagor;
(iii) Immediately prior to the transfer of the Mortgage Loans
to the Trustee, CMSI has good title to, and is the sole legal owner of, each
Mortgage Loan (except as set forth in clause (v) below) and immediately upon the
transfer and assignment herein contemplated, CMSI will have taken all steps
necessary so that the Trustee will have good title to, and will be the sole
legal owner of, each Mortgage Loan (except as set forth in clause (v) below);
(iv) As of the Cut-Off Date, no payment of principal of or
interest on or in respect of any Mortgage Loan was 30 days or more past due (a
Mortgage Loan being considered 30 days past due in a given month when payment
due on the first day of the prior month has riot been made on or before the last
day of such prior month) or has been 30 days or more past due more than once for
the twelve months preceding the Cut-Off Date;
(v) As of the Issue Date, there is no mechanics' lien or claim
for work, labor or material affecting the premises subject to any Mortgage which
is or may be a lien prior to, or equal with, the lien of such Mortgage except
those which are insured against by the title insurance policy referred to in (x)
below;
(vi) As of the Issue Date, there is no delinquent tax or
assessment lien against any Mortgaged Property;
(vii) As of the Issue Date, there is no valid offset, defense
or counterclaim to any Mortgage Note or Mortgage, including the obligation of
the Mortgagor to pay the unpaid principal and interest on such Mortgage Note;
(viii) As of the Issue Date, each Mortgaged Property is free of
material damage and is in good repair;
(ix) Each Mortgage at the time it was originated complied in
all material respects with applicable state and federal laws, including, without
limitation, usury, equal credit opportunity, recording and disclosure laws;
(x) A lender's title insurance policy or binder (which shall
have been approved as such by either FNMA or the FHLMC) or other assurance of
title customary in the relevant jurisdiction therefor, was issued on the date of
the origination of each Mortgage Loan (other than a Mortgage Loan relating to a
cooperative apartment), and, as of the Issue Date, each such policy, binder or
assurance is valid and remains in full force and effect;
(xi) The Mortgage Loans conform in all material respects with
the descriptions thereof in the Prospectus and the Prospectus Supplement
relating to the Certificates;
(xii) Each Mortgage Loan having an original principal amount
exceeding 90% of its Original Value is covered by primary mortgage insurance at
least until the outstanding principal amount thereof is less than or equal to
80% of either the Original Value through principal payments by the Mortgagor or
the value
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thereof as determined by a new appraisal delivered subsequent to origination. So
long as it is in effect, such primary mortgage insurance covers the losses
arising from defaults in an amount equal to the excess, of the outstanding
principal amount of such Mortgage Loan over 75% of the Original Value of such
Mortgage Loan;
(xiii) The original principal amount of each Mortgage Loan was
not more than 95% of the Original Value of such Mortgage Loan; and
(xiv) With respect to each Buydown Mortgage Loan, the Buydown
Funds deposited in the Buydown Account, if any, will be sufficient, after
crediting interest at the rate per annum, if any, specified in the buydown
agreement compounded monthly to the Buydown Account and adding the amounts
required to be paid by the Mortgagor, to make the scheduled payments stated in
the Mortgage Note for the term of the Buydown Subsidy Agreement.
It is understood and agreed that the representations and warranties set
forth in this Section 2.03 shall survive delivery of the respective Mortgage
Files to the Trustee. Upon discovery by CMSI or the Trustee of a breach of any
of the foregoing representations and warranties which materially and adversely
affects the interests of the Certificateholders in the related Mortgage Loan
(including any Mortgage Loan substituted for a nonconforming Mortgage Loan
pursuant to Section 2.04), the party discovering such breach shall give prompt
written notice to the other parties hereto. If within 60 days of the date of
such notice of breach or, with the prior written consent of a Responsible
Officer of the Trustee, such longer period specified in such consent, CMSI does
not cure such breach in all material respects (including by substitution of one
or more Eligible Substitute Mortgage Loans if and to the extent permitted by
Section 2.04), CMSI shall repurchase such Mortgage Loan from the Trustee.
Any such repurchase of a Mortgage Loan by CMSI shall be accomplished in
the manner and at the repurchase price set forth in Section 2.02. Any such
repurchase shall be considered a prepayment in full of such Mortgage Loan on
such Due Date and shall be deposited (net of all Voluntary Advances, Trustee
Advances and Advance Amount Advances with respect to such Mortgage Loan, which
shall be reimbursed to the Trustee or deemed reimbursed to CMSI, as the case may
be) by CMSI in the Certificate Account and, upon receipt by the Trustee of
written notification of such deposit signed by an Authorized Officer of CMSI,
the Trustee shall release to CMSI the related Mortgage File and shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, as CMSI shall reasonably request, to vest in CMSI any Mortgage Loan
released pursuant hereto. Any repurchase by CMSI of a Mortgage Loan hereunder
shall be deemed to include the right to receive any Remittance thereon payable
after the month of repurchase, and the Trustee shall, upon receipt of any such
Remittance, promptly remit the amount of such Remittance to CMSI. It is
understood and agreed that the obligation of CMSI to repurchase any Mortgage
Loan as to which a breach occurred and is continuing and the limited indemnity
set forth in the following paragraph shall constitute the sole remedies against
CMSI respecting such breach available to the Certificateholders or the Trustee
on behalf of the Certificateholders.
Section 2.04. Substitution of Eligible Substitute Mortgage Loans for
Nonconforming Mortgage Loans.
(a) CMSI shall have the right, in an event requiring a repurchase
pursuant to Section 2.02 or 2.03, to substitute one or more Eligible Substitute
Mortgage Loans for any one or more nonconforming Mortgage Loans, any such
substitution to take place on the day designated by CMSI (the "Substitution
Day") occurring before a date two years after the Startup Day (or, if the
Substitution Day is not a Business Day, the next proceeding Business Day),
subject to the satisfaction of the conditions set forth in Section 2.01 and
subject to the satisfaction of the following conditions;
(i) no Event of Default shall have occurred and be continuing;
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(ii) the aggregate Adjusted Balance of all Eligible Substitute
Mortgage Loans substituted on the Substitution Day (determined with respect to
each Eligible Substitute Mortgage Loan as of the Substitution Day) shall not
exceed an amount equal to 40% of the aggregate Adjusted Balance of all Mortgage
Loans as of the Closing Date;
(iii) the Trustee shall have received an Officer's Certificate
(A) stating that all conditions precedent to such substitution specified in this
subsection (a) have been satisfied and attaching as an exhibit a supplemental
Mortgage Loan schedule (the "Supplemental Mortgage Loan Schedule") setting forth
the same type of information as appears on the Mortgage Loan Schedule and
representing as to the accuracy thereof and (B) confirming that the
representations and warranties contained in Section 2.03 (other than paragraphs
(i) and (xi) thereof) are true and correct in all material respects with respect
to the Eligible Substitute Mortgage Loans on and as of the Substitution Day,
provided that remedies for the inaccuracy of such representation are limited as
set forth in Sections 2.02, 2.03 and this 2.04; and
(iv) the Trustee shall have received, not later than the
Substitution Day, an Opinion of Counsel (who may not be an employee of CMSI or
of an Affiliate of CMSI) and, if required by such counsel, a letter from an
accountant, dated the Substitution Day, to the effect (A) that all conditions to
such substitution specified in this subsection (a) have been satisfied, (B) that
the Eligible Substitute Mortgage Loans are "qualified replacement mortgages"
within the meaning of Code Section 860G(a)(4), and (C) that the substitution of
such Eligible Substitute Mortgage Loans will not result in the disqualification
of the Trust Fund as two separate REMICs under the Code or otherwise subject
either REMIC to any tax.
(b) In the event that, on the Substitution Day, any Prepaid
Installments have been received in the Certificate Account with respect to such
Mortgage Loan, the full amount of such Prepaid Installment shall be paid on the
Substitution Day to CMSI from the Certificate Account.
(c) Concurrently with the satisfaction of the conditions set forth in
Section 2.04(a) above and the grant of such Eligible Substitute Mortgage Loans
to the Trustee pursuant to Section 2.04(a) above, (A) Exhibit B to this
Agreement shall be deemed to be amended to exclude all Mortgage Loans being
replaced by such Eligible Substitute Mortgage Loans and to include, pursuant to
Section 10.01, the information set forth on the Supplemental Mortgage Loan
Schedule with respect to such Eligible Substitute Mortgage Loans, and all
references in this Agreement to Mortgage Loans shall include such Eligible
Substitute Mortgage Loans and (B) the Trustee shall release to CMSI the
nonconforming Mortgage Loan or Loans and execute and deliver such instruments of
transfer or assignment as may be required to transfer, without recourse, to CMSI
such nonconforming Mortgage Loan or Loans.
Section 2.05. Authentication of Certificates. The Trustee has
authenticated and delivered or caused to be authenticated and delivered to or
upon the order of CMSI, in accordance with the CMSI Order, in exchange for the
Mortgage Loans, concurrently with the transfer and assignment to the Trustee of
the Mortgage Loans, Certificates duly authenticated by the Trustee in authorized
denominations evidencing the entire ownership of the Trust Fund. The Trustee
acknowledges issuance to it of the Class L Regular Interest on behalf of the
Upper-Tier REMIC.
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ARTICLE III
CERTIFICATE ACCOUNT; PAYMENTS AND STATEMENTS TO
CERTIFICATEHOLDERS; ADMINISTRATION AND SERVICING OF
MORTGAGE LOANS
Section 3.01. Collection of Moneys. Except as otherwise expressly
provided herein, the Trustee may demand or cause to be demanded payment or
delivery of, and shall receive and collect, directly and without intervention or
assistance of any fiscal agent or other intermediary, all money and other
property payable to or receivable by the Trustee pursuant to this Agreement. The
Trustee shall hold all money and property received by it as part of the Trust
Fund and shall apply it as provided in this Agreement.
CMSI shall make reasonable efforts to collect all payments called for
under the terms and provisions of the Mortgage Loans and shall, to the extent
such procedures shall be consistent with this Agreement, follow such normal
collection procedures as it deems necessary and advisable. CMSI shall not be
required to institute litigation with respect to collection of any payment if it
reasonably questions its ability to enforce the provision of the Mortgage Loan
under which such payment is required. Consistent with the foregoing, CMSI may in
its discretion (a) waive any late payment charge or any prepayment charge or
penalty interest in connection with the prepayment of a Mortgage Loan or any
assumption fees or other fees which may be collected in the ordinary course of
servicing such Mortgage Loan and (b) arrange with a Mortgagor a schedule for the
payment of principal and interest due and unpaid after the applicable Due Date,
provided, if the arrangement is for a period of more than 90 days, CMSI
reasonably believes that without such arrangement the Mortgagor would default on
the related Mortgage Loan. Regardless of whether any arrangement of the type
described in clause (b) above is made, any such Mortgage Loan shall be
considered delinquent for all purposes of this Pooling Agreement.
Section 3.02. Certificate Account. (a) On or before the Issue Date,
CMSI shall open or cause to be opened with a Depository, Depositories or the
Trustee one or more accounts in the name of the Trustee, which shall
collectively be the "Certificate Account". The Certificate Account will be an
Investment Account if so specified in Article XII; otherwise, the Certificate
Account with be a non-interest bearing account. CMSI, on behalf of the Trustee,
shall promptly deposit, or cause to be deposited, daily in the Certificate
Account, within one Business Day following receipt and posting, all Remittances
related to Affiliated Mortgage Loans received by it. Remittances related to the
CitiMae Mortgage Loans shall be deposited into the Custodial Accounts for P&I
and the Certificate Account in accordance with Section 3.03. All Remittances,
any amount required to be deposited in the Certificate Account pursuant to
Section 2.01, all other deposits therein pursuant to this Agreement, and all
investments made with such moneys, including all income or other gain from such
investments, shall be held by the Trustee in the Certificate Account as part of
the Trust Fund as herein provided, except for amounts from Buydown Funds
required to be deposited pursuant to Section 3.06, which shall be held by the
Trustee in the Buydown Account on behalf of the Mortgagors, subject to
withdrawal by the Trustee or CMSI as servicer for the purposes set forth in
subsections (b) and (c) of Section 3.04. All funds withdrawn from the
Certificate Account pursuant to subsection (b) of Section 3.04 for the purpose
of making distributions to the Certificateholders shall be applied in accordance
with said subsections. The Trustee shall take such steps as CMSI may reasonably
request in order to enable CMSI to make deposits to and withdrawals from the
Certificate Account in accordance with Sections 3.03, 3.14 and 3.16.
Funds in the Certificate Account shall be invested and reinvested by
the Trustee at CMSI's written direction (subject to subsections (d) of this
Section 3.02) in one or more Eligible Investments bearing interest or sold at
discount. Notwithstanding the foregoing, no investment of any amount held in the
Certificate Account may mature later than the Business Day immediately preceding
the next Distribution Date; provided, however, that investments (including
repurchase agreements) on which the Trustee, in its commercial capacity, is the
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obligor, may mature on a Distribution Date if, under this Section 3.02, such
investment could otherwise mature on the Business Day immediately preceding such
Distribution Date.
All income from investment of moneys deposited in a Certificate
Account, and all proceeds of disposition of any assets in the Certificate
Account, shall be deposited by the Trustee, the Servicer or the Master Servicer
in such Certificate Account immediately upon receipt, and any loss resulting
from such investment shall be charged to such Certificate Account. The Trustee
shall have no liability for any loss incurred in connection with any investment
or any sale or liquidation thereof pursuant hereto, unless caused by its
negligence or willful misconduct.
CMSI may deposit in each of the Certificate Account, Servicing Account
and Buydown Account the appropriate payments, collections and funds in respect
of one or more series of certificates issued under a registration statement
covering the CitiCertificates or similar certificates; provided that the senior
class of certificates of each such other series and the senior Class of
CitiCertificates are rated "AAA" or its equivalent or in the category "AA" or
its equivalent and the subordinated class of certificates of each such other
series and the subordinated Class of CitiCertificates are rated in the same
category by each Rating Agency, and provided further that separate accounting is
maintained.
(b) Funds and other property in the Certificate Account shall not be
commingled with any other moneys or property of the Trustee. Notwithstanding the
foregoing, the Trustee may hold any funds or other property received or held by
it as part of the Certificate Account in collective accounts maintained by it in
the normal course of its business and containing funds or property held by it
for other persons; provided that such accounts are under the sole control of the
Trustee and the Trustee maintains adequate records indicating the ownership of
all such funds or property and the portions thereof held for credit to the
Certificate Account.
(c) CMSI will not direct the Trustee to make any investment of any
funds in the Certificate Account or to sell any investment held in the
Investment Account except under the following terms and conditions:
(i) each such investment shall be made in the name of the
Trustee (in its capacity as such) or in the name of a Qualified Nominee of the
Trustee; and
(ii) each such investment shall be a "cash flow investment" as
defined in Code Section 860G(a)(6).
(d) Generally, no Eligible Investment shall be disposed of prior to Its
maturity; provided, however, if any amounts are needed for disbursement from the
Certificate Account and sufficient uninvested funds are not available therein to
make such disbursement, in the absence of a CMSI Order for the liquidation of
investments held therein in an amount sufficient to provide the required funds,
the Trustee shall cause to be sold or otherwise converted to cash a sufficient
amount of the investments in the Certificate Account; provided, further,
however, that prior to any such sale or conversion to cash, the Trustee shall
have received (i) an Opinion of Counsel (which opinion may not be provided by an
employee of CMSI or of an Affiliate of CMSI) that such sale or conversion to
cash shall not constitute a "prohibited transaction" under Code Section 860F(a),
or (ii) (a) if such sale or conversion to cash constitutes such a "prohibited
transaction", the consent of the Holders of 100% Percentage Interest of the
Residual Certificates to the prohibited transaction together with each such
Holder's proportionate share of any tax imposed on the Trust Fund attributable
to such transaction and (b) an Opinion of Counsel (which opinion may not be
provided by an employee of CMSI or of an Affiliate of CMSI) that such
transaction will not disqualify the Trust Fund as a REMIC.
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(e) The Trustee shall not in any way be held liable by reason of any
insufficiency in the Certificate Account or the Buydown Account except for
losses on investments which are liabilities of the Trustee in its commercial
capacity.
(f) Unless it shall have otherwise agreed in writing with CMSI, the
Trustee shall not be required to enter into repurchase obligations for the
investment of funds in the Investment Account with any Person whose repurchase
obligations would be Eligible Investments only if the requirements of subclause
(B) of clause (iii) of the definition of the term "Eligible Investments" were
complied with in connection with such investment.
Section 3.03. CitiMae Mortgage Loans; Custodial Accounts for P&I and
Certificate Account Deposits. (a) The Master Servicer shall cause to be
established and maintained segregated Custodial Accounts for P&I and segregated
Escrow Accounts in accordance with the requirements of the Guide and shall
deposit or cause to be deposited therein within two Business Days the amounts
related to the CitiMae Mortgage Loans required by the Servicing Agreements to be
so deposited except any Retained Fixed Yield Amounts. Proceeds received with
respect to individual CitiMae Mortgage Loans from any title, hazard or other
insurance policy covering such Mortgage Loan other than any Primary Mortgage
Insurance Certificate shall be deposited first in the applicable Escrow Account
if required for the restoration or repair of the related Mortgaged Property.
Proceeds from such insurance policies not so deposited in the applicable Escrow
Account and proceeds from any Primary Mortgage Insurance Certificate shall be
deposited in the Custodial Account for P&I and shall be applied to the balances
of the related CitiMae Mortgage Loans as payments of interest and principal.
Conduit Servicers are authorized to make withdrawals from the Custodial Accounts
for P&I for the purposes required or permitted by this Agreement and in
accordance with the Guide. The Trustee shall have no responsibility for
monitoring such withdrawals. The Custodial Accounts for P&I shall each bear a
designation clearly indicating that the funds deposited therein are held for the
benefit of the Certificateholders. Amounts deposited in any Custodial Account
for P&I shall be fully insured by the FDIC. To the extent amounts received for
deposit in any Custodial Account for P&I will not be fully insured, such excess
shall either, at the option of the Master Servicer, be secured by one or more
Eligible Investments maturing not later than the Determination Date with respect
to such amounts or in every other case be promptly remitted to the Certificate
Account or the account referred to in (d) below, such Eligible Investments as
evidenced by an Opinion of Counsel delivered and acceptable to the Trustee to
the effect that the Master Servicer has either a claim to the funds held by the
institution or a perfected first security interest against any such Eligible
Investments superior to the claims of any other depositor or general creditor of
such institution.
The Master Servicer shall advance the payment of property taxes and
insurance premiums and other similar payments relating to the CitiMae Mortgage
Loans that are not timely paid by the Mortgagors or advanced by the Conduit
Servicers on the date when such tax, premium or other cost for which such
payment is intended is due, but the Master Servicer shall be required to so
advance only to the extent that such advances, in the good faith judgment of the
Master Servicer, will be recoverable by the Master Servicer out of Insurance
Proceeds or Liquidation Proceeds or otherwise from the related CitiMae Mortgage
Loans.
Any amounts received by a Conduit Servicer with respect to a CitiMae
Mortgage Loan shall be deemed to have been received by the Master Servicer for
purposes of this Agreement. In the event a Conduit Servicer fails to remit any
amounts received by the Conduit Servicer and required to be remitted hereunder,
the Master Servicer shall be obligated to transmit the required amounts to the
Trustee regardless of the failure of the Conduit Servicer.
The Master Servicer shall keep, or cause to be kept, and maintain, or
cause to be maintained, separate accounting on a Mortgage Loan by Mortgage Loan
basis, for any remittances to or payments from the Custodial Accounts for P&I.
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(b) Within three days (or the next succeeding Business Day if the third
day is not a Business Day) after the receipt by a Conduit Servicer of Principal
Prepayments in full, Liquidation or Insurance Proceeds with respect to a CitiMae
Mortgage Loan (not required to be applied to the restoration or repair of the
related Mortgaged Property) or (ii) the Substitution Adjustment Amount in
connection with any substitution of a mortgage loan or proceeds from the
repurchase of a Mortgage Loan are deposited by the Conduit Servicer in the
Custodial Account for P&I, the Master Servicer shall withdraw or direct the
withdrawal from the Custodial Accounts for P&I of such amounts and deposit such
amounts in accordance with this paragraph (b); provided, that, so long as CMSI
or an Affiliate of CMSI is the Master Servicer, CMSI or the Conduit Subservicer
may consent to the withdrawal from the Custodial Accounts for PI in the month
following the month of receipt by a Conduit Servicer of amounts representing
Principal Prepayments in full, Liquidation Proceeds and Insurance Proceeds.
Not later than the Determination Date, the Master Servicer shall
withdraw or direct the withdrawal from any funds in the Custodial Accounts for
P&I and deposit into the Certificate Account the following amounts:
(i) Scheduled installments of principal and interest on the
CitiMae Mortgage Loans received or advanced by the Conduit
Servicers which were due the first day of the current month, net of
Conduit Servicing Fees due Conduit Servicers and any Retained Fixed
Yield Amounts, if any;
(ii) Principal Prepayments in full and Liquidation and
Insurance Proceeds (a) received by Conduit Servicers for CitiMae
Mortgage Loans but not yet withdrawn and remitted to the Servicer
in the current month, in those cases where Conduit Servicers must
remit such payments within three days or (b) received by Conduit
Servicers in the immediately preceding month in those cases where
the Master Servicer has consented thereto, net, in the case of
Liquidation Proceeds and Insurance Proceeds, of Conduit Servicing
Fees due Conduit Servicers;
(iii) Partial prepayments of principal received by the Conduit
Servicer for such Mortgage Loans in the immediately preceding
calendar month, or the current month in the case of partial
prepayments received with the scheduled installments of principal
and interest which were due on the first day of the current month;
and
(iv) Payments for repurchase of CitiMae Mortgage Loans by
Conduit Servicers.
(c) Except as otherwise provided herein, the following payments and
collections received or made by the Master Servicer shall be deposited into the
Certificate Account on the Certificate Account Deposit Date (other than in
respect of principal of and interest on the Mortgage Loans due on or before the
Cut-Off Date):
Not later than the Certificate Account Deposit Date. the foregoing
withdrawals and any amounts remitted to the Conduit Servicers pursuant to
paragraph (a) and (b) above shall be deposited into the Certificate Account;
provided, however, that (x) any Principal Prepayments in full, Liquidation or
Insurance Proceeds with respect to the CitiMae Mortgage Loans shall not be
required to be deposited in the Certificate Account earlier than the Certificate
Account Deposit Date in the month succeeding the month in which such amount was
received by the related Conduit Servicer and (y) the Substitution Adjustment
Amount in connection with any Substitute Mortgage Loan and the proceeds from the
repurchase of a CitiMae Mortgage Loan shall not be required to be deposited in
the Certificate Account earlier than the Certificate Account Deposit Date in the
month following the month during which the circumstances which gave rise to such
substitution or repurchase occurred.
In addition, the Master Servicer shall deposit in the Certificate
Account not later than the third Business Day preceding each Certificate Account
Deposit Date, in the case of clause (i) and in the case of clauses (ii) through
(iv) below on the Certificate Account Deposit Date:
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(i) Any Voluntary Advances with respect to the CitiMae
Mortgage Loans by the Master Servicer in respect of such
Distribution Date;
(ii) The amount, if any, with respect to a CitiMae Mortgage
Loan which was prepaid in full by the Mortgagor or for which a
final liquidation has occurred during the preceding calendar month
required to be deposited by the Master Servicer pursuant to Section
3.25 hereof;
(iii) All Liquidation Proceeds received in the preceding month
by the Master Servicer in connection with the liquidation of
defaulted CitiMae Mortgage Loans, net of related Liquidation
Expenses;
(iv) All Insurance Proceeds with respect to a CitiMae Mortgage
Loan received in the preceding month by the Master Servicer, other
than proceeds applied to the restoration or repair of the related
Mortgaged Property; and
(v) With respect to the CitiMae Mortgage Loans, any amount
required to be deposited pursuant to Section 3.21.
CMSI shall deposit in the Certificate Account not later than the
Certificate Account Deposit Date the Substitution Adjustment Amount in
connection with any Substitute Mortgage Loan being substituted and the amount
specified in Sections 2.02 and 2.03 paid by CMSI in respect of any CitiMae
Mortgage Loan or property acquired in respect thereof as to which the
circumstances giving rise to substitution or purchase occurred during the month
preceding such Certificate Account Deposit Date (and not substituted or
purchased by a Conduit Servicer for which a deposit has already been made to
such Conduit Servicer's Custodial Account for P&I or otherwise deposited by the
Master Servicer).
(d) Prior to the Certificate Account Deposit Date the Master Servicer
may deposit the amounts described in Section 3.03(b) in a separate account in
the name of the Master Servicer and the Trustee (such account shall be
maintained in the trust department of a Depositor and shall bear a designation
clearly indicating that the principal of all investments in such account is held
for the benefit of the Trustee on behalf of the Certificateholders) (the
"Investment Account") for investment only in one or more Eligible Investments.
The Master Servicer shall bear any and all losses incurred on any investments
made with such funds and shall be entitled to retain all gains realized on such
investments as additional compensation for its services as Master Servicer. The
amount of any losses incurred in respect of any such investments shall be
deposited in the Investment Account by the Master Servicer out of its own funds
immediately as realized. Any successor master servicer appointed pursuant to
this Agreement shall not be responsible for losses attributable to its
predecessor. No investments held in the Investment Account shall mature later
than the Certificate Account Deposit Date.
Section 3.04. Distributions. (a) By 11:00 a.m. (New York City time) on
each Distribution Date, the Trustee shall cause to be distributed from the
Certificate Account (or, to the extent provided in Sections 3.27 and 3.28 and
Articles XII and XIII, the Upper-Tier REMIC Account) or shall cause the Paying
Agent to distribute from a designated account to each Certificateholder of
record on the related Record Date (other than as provided in Section 9.01
respecting the final distribution) by check mailed to such Certificateholder at
the address appearing in the Certificate Register; if eligible for wire transfer
as set forth in Article XII and if the Trustee has received wiring instructions
from the Certificateholder by wire transfer; or by such other means of payment
as such Certificateholder, CMSI, the Paying Agent and the Trustee (if it is
making payments directly to the Certificateholders) shall agree, the amount
required to be distributed to such Certificateholder pursuant to the
Certificates and this Agreement. If wiring instructions are received by the
Trustee, such instructions will remain in effect until changed by such
Certificateholder by written notice to the Paying Agent and the Trustee at least
five Business Days prior to a subsequent Distribution Date.
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In the event CMSI appoints a Paying Agent, the Trustee will, on or
prior to each Distribution Date, deposit, in immediately available funds from
funds available in the Certificate Account, in an account designated by the
Paying Agent the amount required to be distributed to the Certificateholders on
such Distribution Date pursuant to subsections (b) and (c) of this Section 3.04
and, unless such Paying Agent is CMSI, the Trustee will promptly notify CMSI of
its deposit or its failure to make such deposit. CMSI will cause any Paying
Agent which is not the Trustee to execute and deliver to the Trustee an
instrument in which such Paving Agent agrees with the Trustee that such Paying
Agent will:
(1) hold all amounts deposited with it by CMS I or the Trustee for
payment on the Certificates in trust for the benefit of the Certificateholders
until such amounts are paid to such Certificateholders or otherwise disposed of
as herein provided;
(2) give the Trustee notice of any default by CMSI the making of any
such deposit; and
(3) at any time during the continuance of any default of CMSI in making
such a deposit, upon the written request of the Trustee, forthwith pay to the
Trustee all amounts so held in trust by such Paying Agent.
For each distribution to the Certificateholders or deposit with the
Paying Agent, the Servicer will use Affiliated Uncommitted Cash to make an
Affiliated Certificate Account Advance and the Master Servicer will use Conduit
Uncommitted Cash to make a Conduit Certificate Account Advance to cover any
Remittance Delinquencies relating to the Affiliated Mortgage Loans or CitiMae
Mortgage Loans, respectively, prior to making any Voluntary Advances or
requesting that the Trustee (in its individual capacity) make a Conduit Trustee
Advance or Affiliated Trustee Advance (or an Advance Account Advance).
(b) Based on payments received with respect to the Mortgage Loans, on
each Determination Date the Servicer shall determine:
(i) the Pool Distribution Amount;
(ii) the Class A Interest Amount, the Class A-IO Interest
Amount, the Class A Unpaid Interest Shortfall, the Class A-IO Unpaid Interest
Shortfall, the Class M Interest Amount, the Class M Unpaid Interest Shortfall,
the Class B Subclass Interest Amount for each Class B Subclass and the Class
B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Unpaid Interest Shortfall for
each Class B Subclass;
(iii) the Class A Optimal Principal Amount, the Group I Non-PO
Principal Amount, the Group II Non-PO Principal Amount, the Class A PO Principal
Amount, Class M Optimal Principal Amount and the Class B-1, Class B-2, Class
B-3, Class B-4 and Class B-5 Optimal Principal Amounts;
(iv) the Class A Principal Distribution Amount, the Class M
Principal Distribution Amount and the Class B-1, Class B-2, Class B-3, Class B-4
and Class B-5 Principal Distribution Amount;
(v) the PO Loss Amount;
(vi) the Available PO Loss Funds; and
(vii) Such other information as may be required to determine
the distributions to be made to Certificateholders in accordance with Article
XII.
On each Distribution Date, the Trustee shall distribute or cause to be
distributed from funds on deposit in the Certificate Account (or, to the extent
provided in Sections 3.27 and 3.28 and Articles XII and XIII, the
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Upper-Tier REMIC Account) to each Certificateholder of record on the preceding
Record Date such Certificateholder's share (based on the denomination
represented by Certificates of the applicable Class held by such Holder) of the
amounts distributable to such Class or Subclass in accordance with the
priorities set forth in Articles XII and XIII, each such amount being the amount
thereof set forth in the applicable Distribution Date Statement. Any such amount
withdrawn for application to amounts distributable in respect of interest or in
reduction of Stated Amount pursuant to subsection (d) of this Section 3.04, but
not distributed because of the non-presentation of the related Certificates, or
because the check for such payment is returned undelivered, shall be set aside
and held by the Trustee in a separate trust account for the benefit of the
Holders of such Certificates, and all such amounts will be deemed to have been
distributed to such Holders for the purpose of any calculations required by this
Agreement and will no longer be available for application to any other amounts
due under this Agreement; provided, that after two years, any such amount that
remains in such separate account shall be returned to the Certificate Account or
the Upper-Tier REMIC Account, as the case may be, or, upon termination of the
Trust Fund pursuant to Article IX, to the Holder of the Class LR Certificates or
the Class R Certificates, as appropriate, as of the Termination Date and after
such payment the Holders of such Certificates shall be required to seek payments
as unsecured general creditors from the Certificate Account or the Holder of the
Class LR or Class R Certificates, as the case may be.
(c) On each Distribution Date, so long as CMSI shall have prepared and
delivered to the Trustee a Distribution Date Statement in respect of such
Distribution Date and the Trustee (based on such statement) shall have made, or,
in accordance with this Section 3.03, set aside from amounts in the Certificate
Account an amount sufficient to make the distributions on the Certificates then
required to be made as indicated in such Distribution Date Statement, plus an
amount equal to the Affiliated Uncommitted Cash and the Conduit Uncommitted
Cash, if any, to be in the Certificate Account as of such Distribution Date (to
the extent not required for either a Conduit Certificate Account Advance or an
Affiliated Certificate Account Advance), the amount of which unremitted cash
shall have been certified to the Trustee by CMSI, the cash balance, if any, then
remaining in the related Certificate Account shall be withdrawn from such
Certificate Account by or on behalf of the Trustee and applied to the payment of
the CMSI Fee, if any (to the extent not already retained by the Servicer or
Master Servicer pursuant to Section 3.23), the amount of such payment being set
forth in a certificate of a Servicing Officer or a Responsible Officer, as the
case may be. The balance, if any, of the amount so withdrawn shall be paid on
such Distribution Date by or on behalf of the Trustee to the Holder of the Class
LR Certificate. The Trustee is hereby authorized by CMSI to authorize, and the
Trustee hereby authorizes, the Depository to withdraw the amount of such balance
from the Certificate Account and pay it to the Holder of the Class LR
Certificate, on its behalf in accordance with such Servicer's Certificate.
(d) All reductions in Stated Amount of a Certificate (or one or more
Predecessor Certificates) effected by distributions made on any Distribution
Date or reductions thereof without distributions pursuant to Article XIII or
otherwise in accordance with this Pooling Agreement shall be binding upon all
Holders of such Certificate and of any Certificate issued upon the registration
of transfer thereof or in exchange therefor or in lieu thereof, whether or not
such distribution is noted on such Certificate. The final distribution on each
Certificate (including the final distribution on any Certificate receiving a
distribution in connection with a termination pursuant to Section 9.01) shall be
payable only upon presentation and surrender thereof on or after the
Distribution Date therefor at the office or agency of the Trustee maintained by
the Trustee for such purpose pursuant to Article XII.
Whenever, on the basis of distributions on the Mortgage Loans received
and expected to be received since the preceding Determination Date, CMSI expects
that the Stated Amount of any Class of CitiCertificates will be reduced to zero
on the next Distribution Date it shall, not later than the third day preceding
such Distribution Date, mail or cause to be mailed to the Trustee and each such
Person in whose name a CitiCertificate to be so retired is registered at the
close of business on the applicable Record Date a notice to the effect that:
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(i) CMSI expects that funds sufficient to reduce such Stated
Amount to zero will be available in the Certificate Account on such Distribution
Date, and
(ii) if such funds are available, (A) such final distribution
will be made on such Distribution Date, but only upon presentation and surrender
of such CitiCertificate at the office or agency of the Trustee maintained for
such purpose pursuant to Article XII (the address of which shall be set forth in
such notice), and (B) no interest shall accrue on such CitiCertificate after the
end of the related Interest Accrual Period with respect to such Distribution
Date.
(e) Subject to the foregoing provisions of this Section, each
Certificate delivered under this Agreement upon registration of transfer of or
in exchange for or in lieu of any other Certificate shall carry the rights to
unpaid distributions that were carried by such other Certificate. Any checks
mailed pursuant to subsection (a) of this Section 3.04 and returned undelivered
shall be held in accordance with Section 3.04(b).
(f) Not later than the third Business Day next preceding each
Distribution Date, the Servicer shall prepare or cause to be prepared a
statement (a "Distribution Date Statement") with respect to such Distribution
Date setting forth:
(i) the Distribution Amount for such Distribution Date
(including the portion thereof which represents any Reimbursable Class A Non-PO
Losses, Reimbursable Class A PO Losses, Reimbursable Class M Losses and
Reimbursable Class B Losses for such Distribution Date);
(ii) the aggregate amount of interest accrued during the
related Interest Accrual Period on all Outstanding CitiCertificates and
Certificates and any Non-Supported Interest Shortfalls;
(iii) the aggregate amount of interest to be distributed on
each Class of CitiCertificates then Outstanding, identifying the portion thereof
attributable to Class A Unpaid Interest Shortfalls, Class A-IO Unpaid Interest
Shortfall, Class M Unpaid Interest Shortfalls or Class B Unpaid Interest
Shortfalls;
(iv) the aggregate distribution in reduction of Stated Amount
to be made in respect of each Class of CitiCertificates then Outstanding;
(v) the amount in reduction of Stated Amount of the
CitiCertificates not the result of distributions in reduction of Stated Amount;
(vi) whether the amount expected to be available in the
Certificate Account on such Distribution Date will be sufficient to pay on such
Distribution Date all amounts specified in clauses (iii) and (iv) above and, if
not, the percentages of each such amount which may be paid in accordance with
the priorities set forth in Section 3.04(b) from the amounts expected to be
available in the Certificate Account;
(vii) the amounts included in such statement pursuant to
clauses (iii) and (iv) above, expressed in each case per $1,000 Initial Stated
Amount to be paid on such Distribution Date,
(viii) the aggregate amounts of Servicing Fee and Master
Servicing Fee, if any, to be paid pursuant to Section 3.04(c);
(ix) the Special Hazard Loss Amount, Fraud Loss Amount and
Bankruptcy Loss Amount after giving effect to any changes thereto in respect of
the applicable Distribution Date;
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(x) the amount, if any, to be withdrawn from the Certificate
Account and paid over to the Holder of the Class LR Certificate on such
Distribution Date pursuant to Section 3.04(c); and
(xi) the Stated Amount of the CitiCertificates which will
remain Outstanding after giving effect to the distributions to be made on such
Distribution Date, expressed both on an aggregate basis and per $1,000 Initial
Stated Amount.
Each Distribution Date Statement shall be delivered, by 10:00 a.m. (New York
City time) on the date on which it is due to be prepared, by or on behalf of
CMSI, to the Trustee. The foregoing requirements shall be satisfied by timely
delivery of the reports to Certificateholders required pursuant to Section 3.05,
which collectively shall then be deemed a "Distribution Date Statement" for
purposes of this Agreement, with a copy to the Trustee and the Paying Agent.
(g) In the event that the Servicer determines to make a Voluntary
Advance with respect to the Affiliated Mortgage Loans or the Master Servicer
determines to make a Voluntary Advance with respect to the CitiMae Mortgage
Loans on any Distribution Date, it shall deposit, in the case of an Affiliated
Mortgage Loan, in the Certificate Account not later than the Business Day next
preceding the Distribution Date an amount equal to such Voluntary Advance or in
the case of a CitiMae Mortgage Loan an amount equal to such advance in
accordance with Section 3.03. It is understood and agreed that the election of
the Servicer or the Master Servicer to make any such advance as permitted by
this subsection (g) of Section 3.04 is based upon its good faith judgment that
the amount of such advance will be recoverable from future payments and proceeds
on the related Mortgage Loan, and that no obligation, express or implied, exists
respecting any such advance.
Section 3.05. Reports to Certificateholders. The Trustee will include,
or will cause to be included, with each distribution to Holders of
CitiCertificates and will send, or cause to be sent to the Rating Agencies and
the Underwriter, a statement, prepared or caused to be prepared by CMSI and
delivered to the Trustee, setting forth the following information (per $1,000
Initial Stated Amount or initial notional amount, as to (i) and (ii) below):
(i) to each Certificateholder of a Class of CitiCertificates on
which a distribution in reduction of the Stated Amount is then being made, the
amount of such distribution which represents a reduction in the Stated Amount
and the amount which represents interest, and the Stated Amount of a Single
Certificate after giving effect to the reduction of Stated Amount on such
Distribution Date;
(ii) to each Certificateholder of a Class of CitiCertificates
on which a distribution of interest only is then being made, the aggregate
Stated Amount of Certificates Outstanding of each Class after giving effect to
the distributions in reduction of Stated Amount, if any, made on such
Distribution Date occurring subsequent to the last such report and any reduction
in Stated Amount pursuant to Section 13.02;
(iii) the amount of Servicing Fee and Master Servicing Fee
received by CMSI during the calendar month preceding the month of such
distribution;
(iv) the book value of any real estate acquired by the Trust
Fund through foreclosure or otherwise;
(v) the aggregate Adjusted Balance of the Mortgage Loans as of
the last day of the month next preceding the month of such distribution after
giving effect to payments on the Mortgage Loans due on the related Due Date and
Principal Prepayments distributed on the Distribution Date;
(vi) the number and aggregate principal amount of Mortgage
Loans delinquent 30 days and 60 or more days (as determined by CMSI under the
FHLBB method);
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(vii) the aggregate amount of Remittances received on Mortgage
Loans during the related Due Period;
(viii) any Voluntary Advances, Trustee Advances, Advance
Account Advances, Certificate Account Advances and any other amounts charged
thereto in respect of the applicable Distribution Date;
(ix) the Class A Subclass Stated Amount of each Subclass of
Class A CitiCertificates, the Class M Stated Amount and the Class B Subclass
Stated Amount of each Subclass of the Class B CitiCertificates on such
Distribution Date;
(x) any Class A Unpaid Interest Shortfall, Class A-IO Unpaid
Interest Shortfall, Class M Unpaid Interest Shortfall and Class B Unpaid
Interest Shortfall applicable to the next succeeding Distribution Date;
(xi) the amount in reduction of Stated Amount of the
CitiCertificates not the result of distributions in reduction of Stated Amount;
(xii) the Class A Stated Amount, the Class M Stated Amount and
the Class B Stated Amount as of the following Determination Date after giving
effect to the distribution of principal made and losses allocated with respect
to such Distribution Date; and
(xiii) the Class A Percentage, the Class A Prepayment
Percentage, the Class M Percentage, the Class M Prepayment Percentage, the Class
B-1 Percentage, the Class B-1 Prepayment Percentage, the Class B-2 Percentage,
the Class B-2 Prepayment Percentage, the Class B-3 Percentage, the Class B-3
Prepayment Percentage, the Class B-4 Percentage, the Class B-4 Prepayment
Percentage, the Class B-5 Percentage and the Class B-5 Prepayment Percentage for
the following Distribution Date.
The Trustee will send, or will cause to be sent through the Certificate
Registrar, to Holders of each Class of Residual Certificates a statement setting
forth the information in paragraphs (i) through (viii).
CMSI will provide Certificateholders that are federally insured savings
and loan associations with certain reports, and will provide access to
information and documentation regarding the Mortgage Loans included in the Trust
Fund, sufficient to permit such associations to comply with applicable
regulations of the Office of Thrift Supervision.
In addition to the foregoing, CMSI, on behalf of the Trustee, shall
file with the Internal Revenue Service and furnish to Certificateholders such
statements or information at such times and in such manner as may
be required by the Code.
Section 3.06. Application of Buydown Funds. On or before the Issue Date
if there are any Buydown Mortgage Loans in the Trust Fund, CMSI shall open or
cause to be opened the Buydown Account with the Depository in the name of the
Trustee, on behalf of the Mortgagors. With respect to each Buydown Mortgage
Loan, on the Business Day next following receipt of the Mortgagor's required
monthly payment under the buydown agreement, CMSI will withdraw from the Buydown
Account and deposit, or cause to be deposited. in immediately available funds in
the Certificate Account an amount which, when added to such Mortgagor's payment,
will equal the full monthly payment due under the Mortgage Note. No later than
the fifth Business Day preceding the last Business Day of each calendar month,
CMSI will deposit, or cause to be deposited, in the Buydown Account in
immediately available funds an amount equal to interest at the rate per annum
specified in the buydown agreement compounded monthly on the Buydown Funds with
respect to each Buydown Mortgage Loan.
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If a Buydown Mortgage is fully prepaid while Buydown Funds remain in
the Buydown Account, the unpaid principal balance of such Buydown Mortgage Loan
will be reduced by the amount of such Buydown Funds (which reduction shall
constitute a Principal Prepayment) and, on the Business Day next following the
date of such Principal Prepayment, CMSI shall deposit, or cause to be deposited,
in the Certificate Account, such Buydown Funds. If the property securing a
Buydown Mortgage Loan is sold in liquidation of the Buydown Mortgage Loan
(either by CMSI or the insurer under any related Primary Mortgage Insurance
Certificate) while Buydown Funds remain in the Buydown Account, such Buydown
Funds shall be (i) deposited in the Certificate Account on the Business Day next
following such liquidation as a reduction of the unpaid principal balance of
such Buydown Mortgage Loan or (ii) if and to the extent required under any
applicable Primary Mortgage Insurance Certificate, paid to the insurer of the
Mortgage Loan.
Section 3.07. Tax Returns and Reports to Certificateholders.
(a) For federal income tax purposes, each of the Upper-Tier REMIC and
the Lower-Tier REMIC shall have a calendar year taxable year and shall maintain
its books on the accrual method of accounting.
(b) The Servicer shall prepare and file or cause to be prepared and
filed with the Internal Revenue Service and applicable state or local tax
authorities income tax or information returns for each taxable year with respect
to the Upper-Tier REMIC and the Lower-Tier REMIC, containing such information
and at the times and in the manner as may be required by the Code or state or
local tax laws, regulations, or rules, and shall furnish or cause to be
furnished to Certificateholders, the schedules, statements or information at
such times and in such manner as may be required thereby. Within 30 days of the
Startup Day, the Servicer shall furnish or cause to be furnished to the Internal
Revenue Service, on Form 8811 or as may otherwise be required by the Code, the
name, title, address, and telephone number of the person that the Holders of the
CitiCertificates may contact for tax information relating thereto, together with
such additional information as may be required by such Form, and shall update
such information at the time or times and in the manner required by the Code.
Such federal, state or local income tax or information returns shall be signed
by the Trustee or such other person as may be required to sign such returns by
the Code or state or local tax laws, regulations or rules.
(c) In the first federal income tax return of each of the Upper-Tier
REMIC and the Lower-Tier REMIC for its short taxable year ending December 31 in
the year in which the Startup Day occurs, REMIC status shall be elected for such
taxable year and all succeeding taxable years.
(d) The Servicer will maintain such records relating to each of the
Upper-Tier REMIC and the Lower-Tier REMIC, including but not limited to the
income, expenses, assets and liabilities thereof, and the adjusted basis of the
property thereof determined at such intervals as may be required by the Code, as
may be necessary to prepare the foregoing returns, schedules, statements or
information.
(e) Each Holder of a Residual Certificate shall be deemed to have
agreed, by acceptance thereof, to be bound by this Section 3.07 and by Section
5.02 and by the "REMIC-Related Covenants" set forth in Article XII.
Section 3.08. Intentionally Deleted.
Section 3.09. Reports by Independent Accountants. (a) CMSI hereby
appoints KPMG Peat Marwick LLP as its Independent Accountants for purposes of
preparing and delivering the reports or certificates required by this Section
3.09. Upon any resignation by such firm, CMSI shall promptly appoint a successor
thereto that shall also be a firm of Independent Accountants of recognized
national reputation. If CMSI shall fall to appoint a successor to a firm of
Independent Accountants which has resigned within 15 days after such
resignation, CMSI shall promptly notify the Trustee of such failure in writing.
If CMSI shall not have appointed a successor within
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10 days thereafter, the Trustee shall promptly appoint a successor firm of
Independent Accountants of recognized national reputation. The fees of such
Independent Accountants and any such successor shall be payable by CMSI as
Servicer, or any successor Servicer.
(b) On or before March 31 in relation to the Affiliated Mortgage Loans
and September 30 in relation to the CitiMae Mortgage Loans of each year (each, a
"Report Date"), beginning with the March 31 and September 30, respectively in
the year which begins not less than three months after the date of the initial
issuance of the Certificates, CMSI, at its expense, shall cause the firm of
Independent Accountants appointed pursuant to Section 3.09(a) (who may also
render other services to CMSI) to furnish a report to the Trustee to the effect
that such firm has examined certain documents and records relating to the
servicing of mortgage loans under pooling and servicing agreements substantially
similar to this Pooling Agreement (which agreements shall be described in a
schedule to such statement), and that such examination, which has been conducted
substantially in compliance with the audit guide for audits of non-supervised
mortgagees approved by the Department of Housing and Urban Development, the
Uniform Single Attestation Program for Mortgage Bankers or the Audit Program for
Mortgage serviced by FHLMC for use by independent public accountants (to the
extent that the procedures in such audit guide are applicable to the servicing
obligations set forth in such agreements), has disclosed no items of
noncompliance with the provisions of this Pooling Agreement which, in the
opinion of such firm, are material, except for such items of noncompliance as
shall be set forth in such report. For purposes of such report, such firm may
conclusively presume that any pooling and servicing agreement which governs
certificates offered under a common registration statement under the Act,
covering the CitiCertificates or similar certificates with the CitiCertificates
is substantially similar to the Pooling Agreement, unless such other pooling and
servicing agreement expressly states otherwise.
Section 3.10. CMSI to Act as Servicer of Affiliated Mortgage Loans.
CMSI (or any subservicer to whom such duties are delegated pursuant to Section
6.06 hereof) shall service and administer the Affiliated Mortgage Loans and
shall have the power and authority, acting alone, to do any and all things in
connection with such servicing and administration which it may deem necessary or
desirable. The Servicer shall service the Affiliated Mortgage Loans in
accordance with its normal servicing procedures for mortgage loans held in its
own portfolio. CMSI may perform its servicing responsibilities in connection
with the Affiliated Mortgage Loans through agents or independent contractors as
set forth in Section 6.06. Without limiting the generality of the foregoing,
CMSI shall continue, and is hereby authorized and empowered by the Trustee, to
execute and deliver, on behalf of itself, the Certificateholders and the Trustee
or any of them, any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge and all other comparable instruments, with
respect to the Affiliated Mortgage Loans and with respect to the properties
subject to their respective Mortgages. The Trustee shall furnish CMSI with any
powers of attorney and other documents necessary or appropriate to enable CMSI
to carry out its servicing and administrative duties hereunder.
All costs incurred by CMSI in effecting the timely payment of taxes and
assessments on the properties related to the Affiliated Mortgage Loans subject
to the Mortgages shall not, for the purpose of calculating monthly distributions
to the Certificateholders, be added to the amount owing under the related
Mortgage Loans, notwithstanding that the terms of such Mortgage Loans so permit,
and such costs shall be recoverable by CMSI pursuant to Sections 3.16.
The relationship of CMSI (and of any successor to CMSI as servicer or
Master Servicer under this Pooling Agreement) to the Trustee under this Pooling
Agreement is intended by the parties to be that of an independent contractor and
not that of a joint venturer, partner or agent.
Section 3.11. CMSI to Act as Master Servicer of CitiMae Mortgage Loans.
CMSI, as Master Servicer, shall service and administer the CitiMae Mortgage
Loans and shall have full power and authority, acting alone and/or through
Conduit Servicers, to do any and all things in connection with such servicing
and administration
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which it may de necessary or desirable in connection therewith. Without limiting
the generality of the foregoing, the Master Servicer in its own name is hereby
authorized and empowered by the Trustee, to execute and deliver, on behalf of
the Certificateholders and the Trustee or any of them, any and all instruments
of satisfaction or cancellation, or of partial or full release or discharge and
all other comparable instruments, with respect to the CitiMae Mortgage Loans and
other comparable instruments, with respect to the CitiMae Mortgage Loans and
with respect to the properties subject to the Mortgages. The Trustee shall
furnish the Master Servicer with any powers of attorney and other documents
reasonably necessary or appropriate to enable the Master Servicer to carry out
its servicing and administrative duties of the CitiMae Mortgage Loans.
Unless otherwise specified herein with respect to specific obligations
of the Master Servicer, the Master Servicer shall service and administer the
CitiMae Mortgage Loans in the best interests of, and for the benefit of, the
Certificateholders, in accordance with prudent mortgage loan servicing standards
and procedures accepted in the mortgage banking industry and in accordance with
the Guide. The Master Servicer shall promptly notify the Trustee in writing of
any event, circumstance or occurrence which may adversely affect the ability of
the Master Servicer to service any CitiMae Mortgage Loan or to otherwise perform
and carry our its duties, responsibilities and obligations under and accordance
with this Agreement. The Master Servicer shall at all times maintain accurate
records and books of account and an adequate system of audit and internal
controls. All accounting and loan servicing records pertaining to each CitiMae
Mortgage Loan shall be maintained in such manner as will permit the Trustee, or
its duly authorized representatives and designees to examine and audit and make
legible reproductions of records during reasonable business hours. All such
records shall be maintained for the period required by the Guide or such longer
period as is required by law.
The Master Servicer intends to perform its servicing and administration
functions, as Master Servicer, pursuant to this Agreement through the Conduit
Subservicer. All actions by the Conduit Subservicer with respect to the
servicing and administration of the CitiMae Mortgage Loans shall be treated as
though done by the Master Servicer itself. All documents, instruments or
contracts executed by the Conduit Subservicer on behalf of the Master Servicer
shall be treated by the Trustee as though executed by the Master Servicer
itself.
All costs incurred by the Master Servicer or by any Conduit Servicer in
effecting the timely payment of taxes and assessments on the properties subject
to the CitiMae Mortgage Loans shall not, for the purpose of calculating monthly
distributions to Certificateholders, be added to the amount owing under the
related CitiMae Mortgage Loans, notwithstanding that the terms of such CitiMae
Mortgage Loan so permit, and such costs shall be recoverable by the Master
Servicer to the extent permitted by Section 3.16.
Section 3.12. Servicing Agreements between Master Servicer and Conduit
Servicers; Enforcement of Conduit Servicers. (a) The Master Servicer may enter
into Conduit Servicing Agreements with Conduit Servicers for the servicing and
administration of certain of the CitiMae Mortgage Loans. References in this
Agreement to actions taken or to be taken by the Master Servicer in servicing
the CitiMae Mortgage Loans include actions taken or to be taken by a Conduit
Servicer on behalf of the Master Servicer. Each Servicing Agreement will be upon
such terms and conditions as are not inconsistent with this Agreement and as the
Master Servicer and the Conduit Servicer have agreed and shall be effective as
of the date of conveyance of the CitiMae Mortgage Loans by CMSI to the Trustee.
With the approval of the Master Servicer, a Conduit Servicer may delegate its
servicing obligations to third-party servicers, but such Conduit Servicers will
remain obligated under the related Servicing Agreement. The Master Servicer and
any Conduit Servicer may enter into amendments thereto; provided, however, that
any such amendments shall be consistent with and not violate the provisions of
this Agreement.
(b) As part of its servicing activities hereunder, the Master Servicer,
for the benefit of the Trustee and the Certificateholders, shall enforce the
obligations of each Conduit Servicer under the related Servicing Agreement
including, without limitation, the obligation to make advances in respect of
delinquent payments as required by a Servicing Agreement, to purchase a Mortgage
Loan on account of defective documentation, as
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described in Section 2.02, or on account of a breach of a representation or
warranty, as described in Section 2.03. Such enforcement, including, without
limitation, the legal prosecution of claims, termination of Servicing Agreements
and the pursuit of other appropriate remedies, shall be in such form and carried
out to such an extent and at such time as the Master Servicer, in its good faith
business judgment, would require were it the owner of the related Mortgage
Loans. The Master Servicer shall pay the costs of such enforcement at its own
expense, but shall be reimbursed therefor only (i) from a general recovery
resulting from such enforcement only to the extent. if any, that such recovery
exceeds all amounts due in respect of the related Mortgage Loans or (ii) from a
specific recovery of costs, expenses or attorneys fees against the party against
whom such enforcement is directed.
Section 3.13. Liability of the Master Servicer. Notwithstanding any
Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Master Servicer or a Conduit Servicer or
reference to actions taken through a Conduit Servicer or otherwise, the Master
Servicer shall remain obligated and liable to the Trustee and Certificateholders
for the servicing and administering of the CitiMae Mortgage Loans in accordance
with the provisions of Section 3.11 without diminution of such obligation or
liability by virtue of indemnification from the Conduit Servicer and to the same
extent and under the same terms and conditions as though the Master Servicer
alone were servicing and administering the CitiMae Mortgage Loans. For purposes
of making distributions to Certificateholders all amounts received by a Conduit
Servicer in connection with the CitiMae Mortgage Loans shall be deemed to have
been received by the Master Servicer, and with respect to any successor Master
Servicer from the time such successor Master Servicer becomes the Master
Servicer, whether or not such amounts are actually remitted by the Master
Servicer to the Master Servicer. The Master Servicer shall be entitled to enter
into any agreement with a Conduit Servicer and nothing contained in this
Agreement shall be deemed to limit or modify such indemnification.
Section 3.14. Collection of Certain Mortgage Loan Payments with respect
to an Affiliated Mortgage Loan; Certificate Account. The Servicer shall deposit
or cause to be deposited in the Certificate Account for Affiliated Mortgage
Loans the following amounts:
(i) All payments (other than payments due and payable, and Principal
Prepayments received, on or before the Cut-Off Date) on account of principal,
including Principal Prepayments, on the Affiliated Mortgage Loans;
(ii) All payments (other than those due and payable on or before the
Cut-Off Date) on account of interest on the Affiliated Mortgage Loans, net of
any Servicing Fee retained by it pursuant to Section 3.23;
(iii) Any Buydown Funds required to be deposited pursuant to Section
3.06;
(iv) All Liquidation Proceeds with respect to Affiliated Mortgage Loans
other than proceeds to be applied to the restoration or repair of the property
subject to the related Mortgage or released to the related Mortgagor in
accordance with normal servicing procedures;
(v) All proceeds of any Affiliated Mortgage Loans or property acquired
in respect thereof repurchased pursuant to Sections 2.02, 2.03, 2.04 or 9.01
(including any reserve funds established pursuant to Section 2.02);
(vi) Any Voluntary Advance with respect to an Affiliated Mortgage Loan
or Affiliated Trustee Advance;
(vii) Any Advance Account Advance with respect to an Affiliated
Mortgage Loan; and
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(viii) The amount the Servicer is required to pay into the Certificate
Account pursuant to Section 3.25 with respect to an Affiliated Mortgage Loan.
CMSI shall cause all amounts collected with respect to the Affiliated Mortgage
Loans to be deposited in immediately available funds on the Business Day
following CMSI's receipt of cash or a check or other instrument representing
payment of any such amount. In the event that CMSI must repay any such amount,
by reason of the reversal of a provisional credit owing to the dishonor of a
Mortgagor's check or otherwise, CMSI shall promptly (x) withhold (or cause to be
withheld) a corresponding amount from a subsequent deposit into the Certificate
Account, and (y) restate (or cause to be restated) its accounts appropriately.
The foregoing requirements for deposit in the Certificate Account shall be
exclusive (except with respect to payments of Voluntary Advances made with
respect to Affiliated Mortgages pursuant to Section 3.04(g) and any Advance
Account Advance pursuant to Section 8.14), it being understood and agreed that,
without limiting the generality of the foregoing, amounts required to be
deposited into the Servicing Account, amounts in the nature of prepayment
charges, late payment charges, assumption fees and other fees and proceeds of
reimbursements of Property Protection Expenses received with respect to
Affiliated Mortgage Loans need not be deposited by CMSI in the Certificate
Account.
Section 3.15. Collection of Taxes, Assessments and Other Items,
Servicing Account. In addition to the Certificate Account, Escrow Accounts,
Custodial Accounts for P&I and the Buydown Account, CMSI shall establish and
maintain or cause to be established and maintained with Depositories Servicing
Accounts and shall deposit therein all collections of taxes, assessments,
primary mortgage or hazard insurance premiums or comparable items for the
account of the Mortgagors. Withdrawals from the Servicing Account may be made
only to effect payment of taxes, assessments, primary mortgage or hazard
insurance premiums or comparable items, to reimburse CMSI out of related
collections for any payments made pursuant to Section 3.10 regarding taxes and
assessments, Section 3.17 regarding premiums on Primary Mortgage Insurance
Certificates and Section 3.18 regarding premiums on standard hazard insurance
policies, to refund to any Mortgagors any sums determined to be overages, or to
pay interest owed to Mortgagors on such account to the extent required by law or
to clear and terminate such accounts at the termination of this Agreement in
accordance with Section 9.01.
Section 3.16. Permitted Withdrawals from the Certificate Account. CMSI
may, from time to time, make (or cause to be made) payments from the Certificate
Account for the following purposes, in order of priority listed:
(i) To pay itself the Servicing Fee and Expenses (to the extent not
withheld from payments of interest received on the Mortgage Loans);
(ii) To reimburse itself for Liquidation Expenses theretofore incurred
in respect of any Mortgage Loan in an amount not to exceed the amount of
Liquidation Proceeds deposited in respect of such Mortgage Loan pursuant to
Sections 3.04 and 3.10, net of the Servicing Fee or, Expenses, as applicable, as
hereinafter specified, and, to the extent that Liquidation Proceeds after such
reimbursement are excess of the principal balance of the related Mortgage Loan
together with accrued and unpaid interest thereon at the Mortgage Note Rate to
the date of purchase at the foreclosure sale, liquidation proceeding or
otherwise, pay to itself an amount equal to such excess and to pay itself the
amounts due the Servicer under Section 3.21 relating to deficiency actions;
(iii) To reimburse the Servicer or Master Servicer for Voluntary
Advances made by the Servicer or the Master Servicer, as applicable, or to
reimburse the Trustee for Conduit Trustee Advances or Affiliated Trustee
Advances, with respect to Mortgage Loans the Servicer's, Master Servicer's or
Trustee's right to reimburse itself pursuant to this clause (iii) being limited
to amounts received on particular Mortgage Loans (including, for this purpose,
Insurance Proceeds and Liquidation Proceeds) that represent late recoveries of
payments of principal and/or interest respecting which any such advance was
made;
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(iv) To reimburse the Servicer, Master Servicer or Trustee for any
Voluntary Advances or Trustee Advance, as applicable (or portion thereof) that
the Servicer, Master Servicer or Trustee determines in good faith have become
Nonrecoverable Advances; provided, however, that the portion of Nonrecoverable
Advances in respect of CitiMae Mortgage Loans constituting Retained Fixed Yield
may only be reimbursed from funds in the Certificate Account constituting
Retained Fixed Yield and not from assets of the Trust;
(v) To reimburse itself for advances made with respect to any Mortgage
Loan as contemplated by Section 3.10 in payment of taxes or assessments,
pursuant to Section 3.17 in payment of premiums on Primary Mortgage Insurance
Certificates, and pursuant to Section 3.18 in payment of hazard insurance
premiums (except premiums on the blanket policy referred to in Section 3.18) in
any amount not heretofore reimbursed out of the Servicing Account, in each case
to the extent and only to the extent that reimbursements of such advances with
respect to such Mortgage Loans have been deposited in the Certificate Account
pursuant to Sections 3.03 or 3.14;
(vi) To make payments permitted pursuant to the last sentence of
Section 6.03;
(vii) To reimburse the Servicer or Master Servicer for Voluntary
Advances, to reimburse the Trustee for Conduit Trustee Advances and Affiliated
Trustee Advances, to reimburse the Advance Account for any Advance Account
Advances, theretofore made in respect of any Mortgage Loan in an amount not to
exceed at any time in the aggregate the amount of payments from time to time
deposited in the Certificate Account and not required to be distributed to the
Certificateholders (including, for this purpose, Liquidation Proceeds and
Insurance Proceeds covering the property subject to the related Mortgage);
(viii) To make payments in the amounts and in the manner provided in
Sections 3.04, 12.01 and 13.01;
(ix) To clear and terminate the Certificate Account pursuant to Section
9.01; and
(x) To pay to itself or the Seller, as the case may be, with respect to
each Mortgage Loan or property acquired in respect thereof that has been
purchased pursuant to Section 2.02, 2.03 or 9.01, all amounts received thereon
following such purchase and not distributed as of the date on which the related
Adjusted Balance or Purchase Price is determined.
CMSI shall keep and maintain (or cause to be kept and maintained)
separate accounting records, on a Mortgage Loan-by-Mortgage Loan basis, for the
purpose of accounting for withdrawals from the Certificate Account pursuant to
clauses (ii), (iii), (iv),(vi), (vii), (viii) and (xi) of this Section;
provided, however. that it is understood and agreed that such records need not
be retained by CMSI for a period longer than its five most recent fiscal years.
Section 3.17. Maintenance of Primary Mortgage Insurance Certificates.
CMSI covenants and agrees to exercise its best reasonable efforts to cause to be
maintained and kept in full force and effect each Primary Mortgage Insurance
Certificate in accordance with the terms of such Primary Mortgage Insurance
Certificate. CMSI agrees to effect the timely payment of the premium on each
Primary Mortgage Insurance Certificate, and such costs not otherwise recoverable
shall be recoverable by CMSI pursuant to Section 3.16. In connection with its
activities as administrator and servicer of the Mortgage Loans, CMSI agrees to
present, on behalf of itself, the Trustee and the Certificateholders, claims to
the insurer under each Primary Mortgage Insurance Certificate and, in this
regard, to take such reasonable action as shall be necessary to permit recovery
under any Primary Mortgage Insurance Certificate respecting a defaulted Mortgage
Loan. Pursuant to Section 3.16, any amounts collected by CMSI under any Primary
Mortgage Insurance Certificate shall be deposited in the Certificate Account,
subject to withdrawal pursuant to Section 3.16. CMSI shall have the power to
substitute for any Primary Mortgage Insurance Certificate another substantially
equivalent policy issued by another insurer, provided that
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no such substitution shall be made unless (i) CMSI shall have been advised by
each Rating Agency that such substitution will not negatively affect the
then-current rating by such Rating Agency of the CitiCertificates or (ii) the
claims-paying ability of the primary mortgage insurer is, at the time of such
substitution, rated by each Rating Agency rating the CitiCertificates at least
in the category of "AA" or its equivalent.
Section 3.18. Maintenance of Hazard Insurance, Property Protection
Expenses. CMSI shall cause to be maintained for each Mortgage Loan (other than a
Mortgage Loan relating to a cooperative apartment) hazard insurance with
extended coverage in an amount which is at least equal to (a) the maximum
insurable value of the improvements securing such Mortgage Loan if such amount
is less than the unpaid principal balance on the related Mortgage Loan, (b) the
principal balance owing on such Mortgage Loan if such amount is greater than or
equal to 80% but is less than or equal to 100% of the insurable value or (c) 80%
of the insurable value if principal balance the Mortgage Loan is less than 80%
of the insurable value. Except in the case of cooperative apartments, CMSI shall
also maintain on property acquired upon foreclosure, or by deed in lieu of
foreclosure, hazard fire insurance with extended coverage in an amount which is
at least equal to the lesser of (a) the maximum insurable value from time to
time of the improvements which are a part of such property or (b) the unpaid
principal balance from time to time on such Mortgage Loan at the time of such
foreclosure or deed in lieu of foreclosure plus accrued interest at the Mortgage
Note Rate and the good-faith estimate of CMSI of related Liquidation Expenses to
be incurred in connection therewith. To the extent provided in Sections 3.10 and
3.04, amounts collected by CMSI under any such policies shall be deposited in
the Certificate Account (other than in the case of CitiMae Mortgage Loans,
amounts to be applied to the restoration or repairs of the related Mortgaged
Property or property thus acquired or amounts released to the Mortgagor in
accordance with the Conduit Subservicer normal servicing procedures). Any cost
incurred by CMSI in maintaining any such insurance shall not, for the purpose of
calculating monthly distributions to the Certificateholders, be added to the
amount owing under the related Mortgage Loan, notwithstanding that the terms of
the Mortgage Loan may so permit. Such costs shall be recoverable by CMSI
pursuant to Sections 3.04 and 3.16. In cases in which property securing any
Mortgage Loan is located in a federally designated flood area, the hazard
insurance to be maintained for such Mortgage Low shaft include flood insurance.
It is understood and agreed that no earthquake or other additional insurance is
to be required of any Mortgagor or maintained on property acquired in respect of
a Mortgage Loan, other than pursuant to such applicable laws and regulations as
shall at any time be in force and as shall require such additional insurance. If
CMSI shall obtain and maintain a blanket policy insuring against hazard losses
on all of the Mortgage Loans, it shall conclusively be deemed to have satisfied
its obligations as set forth in the first sentence of this Section 3.16, it
being understood and agreed that such policy may contain a deductible clause, in
which case CMSI shall, in the event that there shall not have been maintained on
the related Mortgaged Property a policy complying with the first sentence of
this Section, and there shall have been a loss which would have been covered by
such policy, deposit in the Certificate Account the amount not otherwise payable
under the blanket policy because of such deductible clause.
Section 3.19. Assumption and Modification Agreements relating to
Affiliated Mortgage Loans. In any case in which property relating to an
Affiliated Mortgage Loan subject to a Mortgage has been or is about to be
conveyed by the Mortgagor, CMSI shall exercise its right to accelerate the
maturity of such Affiliated Mortgage Loan under any due-on-sale clause
applicable thereto to the extent of its contractual arrangements with such
Mortgagor. If it is prevented, as provided in the last paragraph of this
Section, from enforcing any such clause or if the Affiliated Mortgage Loan does
not contain an enforceable due-on-sale provision, CMSI is authorized to take or
enter into an assumption and modification agreement from or with the Person to
whom such property has been or is about to be conveyed, pursuant to which such
Person becomes liable under the related Mortgage Note and the Mortgagor remains
liable thereon; provided, that such Affiliated Mortgage Loan as assumed or
modified meets the requirements set forth in this Pooling Agreement with respect
to the Affiliated Mortgage Loans initially included in the Trust Fund and that
the Affiliated Mortgage Loan shall continue to be covered by my related Primary
Mortgage Insurance Certificate and hazard insurance policy. CMSI shall notify
the Trustee that any assumption and modification agreement has been completed by
forwarding to the Trustee the original
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copy thereof, which copy shall be added by the Trustee or the Mortgage Document
Custodian to the related Mortgage File and 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. In connection with any
such agreement, the interest rate of the related Mortgage Note shall not be
changed nor shall any other term affecting the amount or timing of payment on
the Affiliated Mortgage Loan be changed. Any fee collected by CMSI for entering
into any such agreement will be retained by CMSI as additional servicing
compensation.
Notwithstanding the foregoing paragraph of this Section or any other
provision of this Pooling Agreement, CMSI shall not be deemed to be in default,
breach or any other violation of its obligations hereunder by reason of any
assumption of an Affiliated Mortgage Loan, or transfer of the property subject
to a Mortgage without the assumption thereof, by operation of law or by reason
of any assumption or transfer which CMSI reasonably believes it may be
restricted by law from preventing or which would result in non-coverage of any
resulting loss that would otherwise be covered under the Mortgage Pool Insurance
Policy and any related Primary Mortgage Insurance Certificate, for any reason
whatsoever.
Section 3.20 Enforcement of Due-On-Sale Clauses, Assumption Agreements.
(a) When any Mortgaged Property relating to a CitiMae Mortgage Loan is conveyed
by the Mortgagor, the Master Servicer shall enforce any due-on-sale clause
contained in any Mortgage Note or Mortgage that becomes operative in accordance
with the terms of such Mortgage Note or Mortgage, as the case may be, to the
extent permitted under applicable law and governmental regulations, but only to
the extent that such enforcement will not adversely affect or jeopardize
coverage under any insurance policy. Notwithstanding the foregoing, (i) the
Master Servicer shall not be deemed to be in default wider this Section 3.20 (a)
by reason of any transfer or assumption which the Master Servicer is restricted
by law from preventing and (ii) if the Master Servicer determined that it is
reasonably likely that any Mortgagor will bring, or if any Mortgagor does bring,
legal action to declare invalid or otherwise avoid enforcement of a due-on-sale
clause contained in any Mortgage Note or Mortgage, the Master Servicer shall not
be required to enforce the due-on-sale clause or to contest such action.
(b) Subject to the Master Servicer's duty to enforce any due-on-sale
clause as provided above, if a CitiMae Mortgage Loan contains no due-on-sale
clause or the Master Servicer is prevented, as provided in Section 3.20(a), from
enforcing any such clause, the Master Servicer is authorized to take or enter
into an assumption and modification agreement from or 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 the Mortgagor remains liable thereon.
The Master Servicer shall not take or enter into any such assumption and
modification agreement, however, unless such transferee satisfies the
underwriting standards set forth in the Guide and provided that the coverage
required under any insurance policy will not be adversely affected or
jeopardized and unless (to the extent practicable in the circumstances) it shall
have received confirmation of the continued effectiveness of any applicable
Primary Mortgage Insurance Certificate or hazard insurance policy. The Master
Servicer shall notify the Trustee that any assumption and modification agreement
has been completed by forwarding to the Trustee the original copy thereof, which
copy shall be added by the Trustee to the related Mortgage File and 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. In connection
with any such agreement, no changes to the interest rate, principal balance, the
monthly installment or any material payment term of the Mortgage Loan shall be
made, and any fee collected by the Conduit Servicer for entering into any such
agreement will be retained by the Master Servicer as additional servicing
compensation.
Section 3.21. Realization on Defaulted Mortgage Loans. CMSI shall use
its best efforts, consistent with its customary servicing procedures, to
foreclose upon or otherwise comparably convert the ownership of properties
securing such of the Mortgage Loans as come into and continue in default and as
to which no satisfactory arrangements can be made for collection of delinquent
payments pursuant to Section 3.01. Consistent with the foregoing, CMSI shall use
reasonable efforts to realize upon defaulted Mortgage Loans in
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such manner as will maximize the receipt of principal and interest by the
Certificateholders, taking into account, among other things, the timing of
foreclosure proceedings. In the event a deficiency action is available against
the Mortgagor or any other person, CMSI may proceed for the deficiency. The
Servicer or Master Servicer may retain twenty-five percent of the net proceeds
received from a Mortgagor pursuant to a deficiency action as compensation for
entering into such deficiency action. Foreclosure on shares issued by
cooperative housing corporations shall be by sale in accordance with the
provisions of Article 9 of the Uniform Commercial Code in effect in the
applicable jurisdiction.
In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be issued to the Trustee, or to Its nominee on behalf of the Trust Fund.
Notwithstanding any such acquisition of title and cancellation of the related
Mortgage Loan, such Mortgage Low shall (except for purposes of Section 9.01) be
considered to be an Outstanding Mortgage Loan such time as the Mortgaged
Property shall be sold and such Mortgage Loan becomes a Liquidated Loan.
Consistent with the foregoing for purposes of all calculations hereunder so long
as such Mortgage Loan shall be considered to be an Outstanding Mortgage Loan, it
shall be assumed that the related Mortgage Note and its amortization schedule in
effect on and after such acquisition of title (after giving effect to any
previous Principal Prepayments, and before any adjustment thereto by reason of
any Deficient Valuations and Debt Service Reductions or any similar proceeding
or any moratorium or similar waiver or grace period) remain in effect
(notwithstanding that the indebtedness evidence by such Mortgage Note shall have
been discharged), subject to adjustment to reflect the application of REO
Proceeds received in any month. Net REO Proceeds received in any month shall be
deemed to have been received first in payment of the accrued interest that
remained unpaid on the date that such Mortgage Loan became an REO Mortgage Loan,
with the excess thereof, if any, being deemed to have been received in respect
of the delinquent principal installments that remained unpaid on such date.
Thereafter, Net REO Proceeds received in any month shall be applied to the
payment of installments of principal and accrued interest on such Mortgage Loan
deemed to be due and payable in accordance with the terms of such Mortgage Note
and such amortization schedule. If such Net REO Proceeds exceed the then
delinquent principal and interest installments on such Mortgage Loan, the excess
shall be treated as a Principal Prepayment received in respect of such Mortgage
Loan.
In connection with any Liquidated Loan as to which CMSI has accepted a
deed in lieu of foreclosure, CMSI shall dispose of such Mortgaged Property prior
to two years after its acquisition by the Lower-Tier REMIC unless (i) the
Trustee shall have been supplied with an Opinion of Counsel to the effect that
the holding by the Lower-Tier REMIC of such Mortgaged Property subsequent to
such two-year period (and specifying the period beyond such two-year period for
which the Mortgaged Property may be held) will not result in the imposition of
taxes on "prohibited transactions" of the Lower-Tier REMIC as defined in Code
Section 860F, or cause the Lower-Tier REMIC or the Upper-Tier REMIC to fail to
quality, as a REMIC at any time that any CitiCertificates are Outstanding, in
which case the Lower-Tier REMIC may continue to hold such until Mortgaged
Property (subject to any conditions contained in such Opinion of Counsel), or
(ii) CMSI shall have applied for, prior to the expiration of such two-year
period, an extension of such two-year period in the manner contemplated by Code
Section 856(e)(3), in which case the two-year period shall be extended by the
applicable period. Notwithstanding any other provision of this Agreement, unless
otherwise required pursuant to applicable state law, no Mortgaged Property
acquired by the Lower-Tier REMIC shall be (x) rented (or allowed to continue to
be rented) or otherwise used for the production of income by or on behalf of the
Lower-Tier REMIC in such a manner or pursuant to any terms that would (1) cause
such Mortgaged Property to fall to qualify at any time as "foreclosure property"
within the meaning of Code Section 860G(a)(8), (2) subject the Lower-Tier REMIC
to the imposition of any federal or state income taxes on "net income from
foreclosure property" earned from such Mortgaged Property within the meaning of
Code Section 860G(c), or (3) cause the sale of such Mortgaged Property to result
in the receipt by the Lower-Tier REMIC of any income from non-permitted assets
as described in Code Section 860F(a)(2)(B) or (y) sold in such manner or
pursuant to any terms that would subject the Lower-Tier REMIC or the Upper-Tier
REMIC to the imposition of any federal or state income taxes on "net income from
foreclosure property" within
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the meaning of Code Section 860G(c), unless CMSI has agreed to indemnify and
hold harmless the Lower-Tier REMIC and the Upper-Tier REMIC with respect to the
imposition of any such taxes.
The foregoing is subject to the provision that, in any case in which
property subject to a Mortgage shall have suffered damage, whether from an
Uninsured Cause or otherwise, CMSI shall not be required to expend its own funds
in connection with any foreclosure or towards the restoration of such property
unless it shall determine in its discretion (a) that such restoration and/or
foreclosure will increase the net proceeds of liquidation of the related
Mortgage Loan to the Certificateholders after reimbursement to itself for such
expenses and (b) that such expenses will be recoverable by CMSI through either
Liquidation Proceeds or Insurance Proceeds (with respect to each of which it
shall have priority for purposes of withdrawals from the Certificate Account
pursuant to Section 3.16 from the related property, as contemplated in Section
3.16.) CMSI shall be responsible for all other costs and expenses incurred by it
in any such proceedings; provided, however, that it shall be entitled to
reimbursement thereof from the related property, as contemplated in Section
3.16. Notwithstanding the above, CMSI shall not be entitled to recover legal
expenses incurred in connection with liquidation proceedings where the Mortgagor
pays all delinquent payments and expenses and such proceedings are terminated
prior to liquidation, other than sums received from the Mortgagor for such
expenses.
Notwithstanding anything to the contrary contained in this Section
3.21, the Servicer shall be under no obligation to foreclose upon or otherwise
convert the ownership of any Mortgaged Property which it believes may be
contaminated with or affected by pollutants, contamination, hazardous wastes or
hazardous substances. The Servicer shall not be liable to the Certificateholders
if, based on its belief that no such contamination or effect exists, the
Servicer forecloses on a Mortgaged Property and takes title to such Mortgaged
Property, and thereafter such Mortgaged Property is determined to be so
contaminated or affected.
In the event CMSI does not elect to foreclose on a Mortgaged Property,
CMSI may, in the exercise of its judgment, elect to accept a payment or
payments, in connection with the sale by the Mortgagor of such Mortgaged
Property or the retention by the Mortgagor of such Mortgaged Property, in
aggregate amount less than the outstanding balance of the related Mortgage Loan
and accrued interest thereon.
The Trustee shall furnish CMSI with any powers of attorney and other
documents necessary, or appropriate to enable CMSI to carry out its efforts in
realizing upon defaulted Mortgage Loans hereunder.
Section 3.22. Trustee to Cooperate; Release of Mortgage Files. Upon the
payment in full of any Mortgage Loan or upon the receipt by CMSI of a
notification that payment in full will be escrowed in a manner customary for
such purpose, CMSI will immediately notify the Trustee by a certification (which
certification shall include a statement to the effect that all amounts received,
and all amounts required to be paid by CMSI pursuant to either Section 3.03 or
3.14 hereof, in connection with such payment which are required to be deposited
to the Certificate Account pursuant to Section 3.03 or 3.14 have been or will be
so deposited) of a Servicing Officer and shall request delivery to it of the
Mortgage File. Upon receipt of such certification and request, the Trustee shall
promptly release or cause the Mortgage Document Custodian to release the related
Mortgage Documents to CMSI. Upon any such payment in full, CMSI is authorized to
execute, pursuant to the authorization contained in Section 3.10, 3.11 or 3.14
as applicable, an instrument of satisfaction regarding such Mortgage, which
instrument of satisfaction shall be recorded by CMSI if required by applicable
law and be delivered to the Person entitled thereto, it being understood and
agreed that no expenses incurred in connection with such instrument of
satisfaction shall be withdrawn from the Certificate Account. From time to time
and as appropriate for the servicing or foreclosure of any Mortgage Loan,
including for this purpose collection under any Primary Mortgage Insurance
Certificate, the Trustee shall, upon request of CMSI and delivery to the Trustee
of a receipt signed by a Servicing Officer, release or cause the Mortgage
Document Custodian to release the related Mortgage Documents to CMSI and shall
execute such documents as shall be necessary to the prosecution of any such
proceedings. Such receipt shall obligate CMSI to return the Mortgage Documents
to the Trustee or the Mortgage
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Document Custodian, as the case may be, when the need therefor by CMSI no longer
exists unless the Mortgage Loan shall have been prepaid or liquidated in the
interim, in which case, upon receipt of a certificate of a Servicing Officer
similar to that hereinabove specified to such effect, the receipt shall be
released by the Trustee to CMSI.
Section 3.23. Servicing Fee, Payment of Certain Expenses by CMSI. In
lieu of receiving the Servicing Fee for the Affiliated Mortgage Loans pursuant
to Section 3.04(c), CMSI as Servicer shall be entitled, prior to the payment of
the amounts described in Section 3.04(b), to withhold and pay to itself out of
each payment received by it on account of interest on each Affiliated Mortgage
Loan (subject to the other provisions of this Section) up to an amount which,
when deducted, will make the portion of interest on each Affiliated Mortgage
Loan being deposited in the Certificate Account for the applicable period equal
to the Pass-Through Rate. In addition, CMSI shall be entitled to receive the
Servicing Fee out of Liquidation Proceeds or Insurance Proceeds, in each case to
the extent permitted by Section 3.16. Any Servicing Fee payable to CMSI pursuant
to this Section shall be payable prior to any other distributions pursuant to
Article XII. Prepayment charges, assumption fees, late payment or other similar
charges shall be retained by CMSI as additional servicing compensation. Any
amounts that CMSI shall be required to deposit in the Certificate Account
pursuant to Section 3.25 shall be deemed to reduce the Servicing Fee to which
CMSI is entitled pursuant to this Section.
CMSI as Master Servicer for the CitiMae Mortgage Loans. as compensation
for its activities hereunder, shall be entitled to receive on each Distribution
Date an amount with respect to each CitiMae Mortgage Loan as to which a monthly
installment of principal and interest has been received equal to one-twelfth of
the Master Servicing Fee Rate for such Mortgage Loan multiplied by the Adjusted
Balance on which such installment of interest accrued.
As compensation for its activities under its Servicing Agreements, each
Conduit Servicer shall be entitled to an amount with respect to each CitiMae
Mortgage Loan as to which a monthly installment of principal and interest has
been received equal to one-twelfth of the Conduit Servicing Fee Rate for such
Mortgage Loan multiplied by the Adjusted Balance on which such installment of
interest accrued. Each Conduit Servicer is required to pay all expenses incurred
by it in connection with its servicing activities under its Servicing Agreement
(including advance payment of premiums for Primary Mortgage Insurance
Certificates, if required) and shall not be entitled to reimbursement therefor
except as specifically provided in the Servicing Agreement and not inconsistent
with this Agreement.
CMSI shall be required to pay all expenses incurred by it in connection
with its activities hereunder and shall not be entitled to reimbursement
therefor except as provided in Sections 3.15, 3.16 and 3.21.
Section 3.24. Reports to the Paying Agent and Trustee. (a) CMSI shall
provide (or cause to be provided) to the Paying Agent (if CMSI is not the Paying
Agent) and the Trustee (if the Trustee is not the Paying Agent) not later than
10:00 a.m. New York City time on the Business Day next preceding the
Distribution Date a statement of the information set forth in clauses (i)
through (viii) of Section 3.05, such information to be given in the aggregate.
(b) Not later than 15 Business Days after receipt of a written request
from the Trustee, CMSI shall forward (or cause to be forwarded) to the Trustee a
statement, certified by a Servicing Officer, of the aggregate of deposits in and
withdrawals from the Certificate Account for each category of deposit specified
in Section 3.03 and 3.14 and each category of withdrawal specified in Section
3.16 for the immediately preceding distribution period or any prior distribution
period or periods specified by the Trustee.
(c) The Trustee may at any time during normal business hours inspect
and copy at CMSI's expense CMSI's books, records and accounts with respect to
the Mortgage Loans.
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Section 3.25. Payments by CMSI. CMSI shall deposit in the Certificate
Account not later than the Distribution Date in the month next succeeding the
month in which Principal Prepayments are received the amount set forth in the
next paragraph.
For Affiliated Mortgage Loans CMSI as Servicer shall deposit an amount
equal to the difference between (a) the product of (i) all such Principal
Prepayments related to the Affiliated Mortgage Loans received in the month prior
to the month in which the Distribution Date for such Determination Date falls
and (ii) the Pass Through Rate divided by (iii) 12 (calculated on the basis of a
360-day year, each month being assured to have 30 days) less (b) the amount of
interest on such Principal Prepayments related to the Affiliated Mortgage Loans
required to be paid by the Mortgagors (adjusted to the Pass-Through Rate). Such
deposit shall be paid from, and limited to, the Servicing Fee received with
respect to scheduled interest payments due on the Affiliated Mortgage Loans on
the Due Date in the month in which such Distribution Date occurs or Principal
Prepayments related to the Affiliated Mortgage Loans received in the preceding
calendar month and other Servicing Fees received with respect to the calendar
month preceding the month in which such Distribution Date occurs. Such deposit
shall be applied first to interest with respect to partial Principal Prepayments
related to the Affiliated Mortgage Loans and second to interest with respect to
Principal Prepayments related to the Affiliated Mortgage Loans in full. No such
deposit shall be considered to be a Voluntary Advance by CMSI or be reimbursable
to CMSI, from cash in the Certificate Account or otherwise.
For each CitiMae Mortgage Loan CMSI, as Master Servicer shall deposit
an amount equal to (x) the amount by which the annual interest at the related
Mortgage Note Rate (net of the related Expense Rate) on the prepaid Adjusted
Balance of such CitiMae Mortgage Loan divided by twelve exceeds (y) the interest
required to be paid by Mortgagor from the due date of the last scheduled payment
of principal and interest on such Mortgage Low to the date of such prepayment
(adjusted to the Mortgage Note Rate (net of the related Expense Rate). Not later
than the Distribution Date immediately succeeding such Determination Date, the
Master Servicer shall deposit in the Certificate Account from its own funds the
amount determined by aggregating, for each such Mortgage Loan for which the
amount determined pursuant to (x) above exceeds the amount determined pursuant
to (y) above less any CitiMae Prepayment Interest Shortfall allocated to the
Retained Fixed Yield, the amount of each such excess, but only to the extent of
(and in reduction of) the Master Servicer Fee payable to it pursuant to Section
3.23 for the calendar month in which such prepaid principal balance is received.
Section 3.26 Refinancings of Mortgage Loans. In addition to waivers and
arrangements permitted by Section 3.01, CMSI reserves the right to offer
refinancings of any Affiliated Mortgage Loan or CitiMae Mortgage Loan, if such
refinancing arises out of a request by the related Mortgagor for a refinancing
or a modification, or for other relief from the provisions of the related
Mortgage Loan.
On the Deposit Date in the month next following the effective date of
the refinancing of any Mortgage Loan pursuant to this Section, CMSI shall
deposit, or cause to be deposited, into the Collection Account an amount equal
to the prepayment in full of such Mortgage Loan (net of all Voluntary Advances
and Trustee Advances with respect to such Mortgage Loan, which shall be
reimbursed to the Trustee or deemed reimbursed to CMSI, as the case may be) and,
upon receipt by the Trustee of written notification of such deposit signed by an
Authorized Officer of CMSI, the related Mortgage File shall be released, and the
Trustee shall comply with the provisions of Section 3.22.
For the purposes of this Section, a "refinancing" will include any
process with a Mortgagor that results in the refinanced Mortgage Loan be
identified and serviced as a "new mortgage loan" in the books, records and
servicing files of the Servicer.
Section 3.27. Two-Tier REMIC Structure; General. Elections shall be
made to treate the Trust Fund formed hereunder as, and the affairs of the Trust
Fund shall be conducted so as to qualify it as, two separate
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REMICs (the "Lower-Tier REMIC" and the "Upper-Tier REMIC", respectively), for
federal income tax purposes. CMSI and the Trustee agree to assure continuing
treatment of the Trust Fund as two separate REMICs and to carry out the
covenants set forth in Article XII and the elections and reporting required in
Section 3.07 on behalf of each of the Lower-Tier REMIC and Upper-Tier REMIC,
including making the appropriate elections to treat the Trust Fund as two
separate REMICs and maintaining two segregated accounts (the "Certificate
Account" and the "Upper-Tier REMIC Account", respectively).
Section 3.28. The Certificate Account and the Upper-Tier REMIC Account.
CMSI, on behalf of the Trustee, shall deposit daily in the Certificate Account
in accordance with Section 3.02 all Remittances received by it, any amounts
required to be deposited in the Certificate Account pursuant to Section 3.01,
all other deposits required to be made to the Certificate Account other than
those amounts specifically designated to be deposited in the Upper-Tier REMIC
Account in this Section 3.28 and all investments made with moneys on deposit in
the Certificate Account, including all income or gain from such investments, if
any. Funds on deposit in the Certificate Account shall be held and invested in
accordance with the applicable provisions of Section 3.02. Distributions from
the Certificate Account shall be made in accordance with the provisions of
Sections 3.04, 3.16 and Articles XII and XIII to make payments in respect of the
Lower-Tier Classes and to pay the Servicing Fee in accordance with Section
3.03(c).
Notwithstanding anything herein to the contrary, Upper-Tier
Certificates shall not receive distributions directly from the Certificate
Account. On each Distribution Date, CMSI, on behalf of the Trustee, shall
withdraw from the Certificate Account and deposit in the Upper-Tier REMIC
Account all distributions to be made on such Distribution Date in respect of
interest on and in reduction of Stated Amount of the Class L Regular Interest.
The Trustee shall cause to be distributed from the Upper-Tier REMIC Account, to
the extent funds are on deposit therefor, all amounts required to be distributed
with respect to the Upper-Tier Certificates as specified in Articles XII and
XIII.
To the extent that any part of the Upper-Tier REMIC Account is
designated in Article XII as an Investment Account, the provisions in Section
3.02 hereof applicable to the investment of funds shall apply to the Upper-Tier
REMIC Account. In addition, the provisions of Section 3.02(b) shall apply to the
Upper-Tier REMIC Account.
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ARTICLE IV
RESERVE FUND
[Reserved]
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ARTICLE V
THE CERTIFICATES
Section 5.01. The Certificates. The CitiCertificates, Class A-IO
Certificates and Residual Certificates shall be substantially in the forms set
forth as Exhibits hereto. The Class A-1, Class A-4, Class A-5, Class A-6, Class
A-7, Class A-8, Class A-9, Class M, Class B-1, Class B-2, Class B-3, Class B-4
and Class B-5 CitiCertificates, the Class A-IO Certificates and the Class L
Regular Interest shall be designated as "regular interest" in the Lower-Tier
REMIC,and the Class A-2 and Class A-3 CitiCertificates shall be designated as
"regular interests" in the Upper-Tier REMIC, in each case within the meaning of
Code Section 860G(a)(1). The Class LR Certificate shall be designated as the
"residual interest" in the Lower-Tier REMIC, and the Class R Certificate shall
be designated as the "residual interest" in the Upper-Tier REMIC, in each case
within the meaning of Code Section 860G(a)(2). The Certificates shall be issued
in the denominations specified in Article XII and shall be executed by manual or
facsimile signature on behalf of CMSI by its Chairman, President or one of its
Vice Presidents under its seal imprinted thereon and attested by the manual or
facsimile signature of its Secretary or one of its Assistant Secretaries.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures were affixed, authorized to sip on behalf of
CMSI shall bind CMSI, notwithstanding that such individuals or any of them have
ceased to be so authorized prior to the authentication and delivery of such
Certificates or did not hold such offices at the date of such Certificates. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless there appears on such Certificate a certificate of
authentication substantially in the form set forth in Exhibit A hereto or, if an
Authenticating Agent is appointed pursuant to Section 8.12, executed by the
Trustee or the Authenticating Agent by manual signature, and such certificate
upon any Certificate shall be conclusive evidence, and the only evidence, that
such Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication. The Class A, Class
M and Class B CitiCertificates shall be engraved, printed or lithographed in
such manner as to comply with the requirements of The Depository Trust Company
or other Clearing Agency if such CitiCertificates are book-entry securities.
Until such time as Definitive Certificates are issued pursuant to
Section 5.06, each CitiCertificate designated as a Book-Entry Certificate in
Article XII shall be held in book-entry form and shall bear a legend in
substantially the following form:
"Unless this certificate is presented by an authorized representative
of [the Clearing Agency] to the Issuer or its agent for registration of
transfer, exchange or payments and any certificate issued is registered in the
name of [the Clearing Agency] or such other name as requested by an authorized
representative of [the Clearing Agency] and any payment is made to [the Clearing
Agency], any transfer, pledge or other use hereof for value or otherwise by or
to any person is wrongful since the registered owner hereof, [the Clearing
Agency], has an interest herein."
(b) Upon original issuance, the Book-Entry Certificates shall be issued
in the form of one or more typewritten certificates, to be delivered to the
initial Clearing Agency, by, or on behalf of, the Issuer. Such CitiCertificates
shall initially be registered on the Certificate Register in the name of the
nominee of the initial Clearing Agency, and no Beneficial Owner will receive a
definitive certificate representing such Beneficial Owner's int in the
Book-Entry Certificates, except as provided in Section 5.06. Unless and until
definitive, fully registered certificates ("Definitive Certificates") have been
issued to Beneficial Owners pursuant to Section 5.06:
(i) the provisions of this Section 5.01(b) shall be in full
force and effect;
(ii) the Issuer, the Servicer, Master Servicer, the Certificate
Registrar and the Trustee may deal with the Clearing Agency for all purposes
(including the making of distributions on the Book-Entry
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Certificates and the taking of actions by the Holders of Book-Entry
Certificates) as the authorized representative of the Beneficial Owners;
(iii) to the extent that the provisions of this Section 5.01(b)
conflict with any other provisions of this Agreement, the provisions of this
Section 5.01(b) shall control;
(iv) the rights of Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by law,
the rules, regulations and procedures of the Clearing Agency and agreements
between such Beneficial Owners and the Clearing Agency and/or the Clearing
Agency Participants, and all references in this Agreement to actions by
Certificateholders shall, with respect to the Book-Entry Certificates, refer to
actions taken by the Clearing Agency upon instructions from the Clearing Agency
Participants, and all references in this Agreement to distributions, notices,
reports and statements to Certificateholders shall, With respect to the
Book-Entry Certificates, refer to distributions, notices, reports and statements
to the Clearing Agency or its nominee, as registered holder of the Book-Entry
Certificates, as the case may be, for the distribution to Beneficial Owners in
accordance with the procedures of the Clearing Agency; and
(v) the initial Clearing Agency will make book-entry transfers
among the Clearing Agency Participants and receive and transmit distributions of
principal and interest on the CitiCertificates to the Clearing Agency
Participants, for distribution by such Clearing Agency Participants to the
Beneficial Owners or their nominees.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing specified voting interests, such direction or consent
shall be given by Beneficial Owners having the requisite percentage interests.
Unless and until Definitive Certificates have been issued to Beneficial
Owners pursuant to Section 5.06, copies of the reports or statements referred to
in Section 3.05 shall be available to Beneficial Owners upon written request to
the Trustee at the Corporate Trust Office.
Section 5.02. Registration of Transfer and Exchange of Certificates.
CMSI shall maintain or cause to be maintained in accordance with the provisions
of Section 6.05 a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, CMSI shall provide for the registration of
Certificates and of transfers and exchanges of Certificates as herein provided.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained by CMSI set forth in Article XII, CMSI shall execute
and the Trustee or the Authenticating Agent shall authenticate and deliver, in
the name of the designated transferee or transferee, one or more new
Certificates in authorized denominations of the same aggregate number of Single
Certificates or the same aggregate Percentage Interest, as the case may be.
At the option of the Certificateholder, Certificates may, be exchanged
for other Certificates of authorized denominations evidencing the same aggregate
number of Single Certificates or the same aggregate Percentage Interest, as the
case may be, upon surrender of the Certificates to be exchanged at any such
office or agency. Whenever any Certificates are so surrendered for exchange,
CMSI shall execute and the Trustee or Authenticating Agent shall authenticate
and deliver the Certificates which the Certificateholder making the exchange is
entitled to receive. Every Certificate presented or surrendered for registration
of transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Trustee, CMSI and the Certificate Registrar duly
executed by the Holder thereof or his attorney duly authorized in writing.
Notwithstanding the foregoing, no transfer or exchange of any Residual
Certificate shall be made by the Trustee or Authenticating
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Agent unless the Certificateholder making the exchange has complied with the
provisions of this Agreement, the respective Certificate and applicable
securities laws.
No service charge shall be made for any registration of transfer or
exchange of the Certificates, but the Certificate Registrar may require payment
of a sum sufficient to cover any tax or governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer and exchange
shall be canceled and, subject to the record retention requirements of the
Exchange Act, subsequently destroyed by the Trustee or, at its direction, by the
Certificate Registrar.
CMSI and the Trustee will cause the Certificate Registrar to provide to
the Paying Agent, if the Paying Agent is not the Certificate Registrar, not
later than the third Business Day next preceding the Distribution Date, the
names and addresses of the Certificateholders as of the Record Date and the
number of Single Certificates or Percentage Interest held of record by each of
them.
Notwithstanding the foregoing, no legal or beneficial interest in all
or any portion of a Residual Certificate may be transferred, directly or
indirectly, to a "disqualified organization" win the meaning of Code Section
860E(e)(5), or to an agent of a disqualified organization (including a broker,
nominee, or other middleman) (an "Agent") and any such purported transfer shall
be void and of no effect. Further, no legal or beneficial interest in all or any
portion of a Residual Certificate may be registered in the name of a Plan or a
Person investing the assets of a Plan (such Plan or Person an "ERISA Prohibited
Holder") or in the name of a person that is not (i) a U.S. Person or (ii) a
non-U.S. Person that holds the Residual Certificate in connection with the
conduct of a trade or business within the United States and has furnished the
transferor and the Trustee with an effective Internal Revenue Service Form 4224
or (iii) a non-U.S. Person that has delivered to both the transferor and the
Trustee an opinion of a nationally recognized tax counsel to the effect that the
transfer of the Residual Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated thereunder and that
such transfer of the Residual Certificate will not be disregarded for federal
income tax purposes (any such person who is not described in clauses (i), (ii)
or (iii) above being referred to herein as a "Nonpermitted Foreign Holder").
CMSI shall not execute and the Trustee or Authenticating Agent shall not
authenticate and deliver, a new Residual Certificate in connection with any
transfer of a Residual Certificate. and neither CMSI nor the Trustee shall
accept a surrender for transfer or registration of transfer, or register the
transfer of, any Residual Certificate unless the transferor shall have provided
to CMSI and the Trustee an affidavit, substantially in the form marked as
Appendix 1 hereto, signed by the transferee, to the effect that the transferee
is not such a disqualified organization, an agent for any entity as to which the
transferee has not received a substantially similar affidavit, an ERISA
Prohibited Holder or a Non-permitted Foreign Holder, accompanied by a written
statement signed by the transferor to the effect that, as of the time of the
transfer. the transferor has no actual knowledge that such affidavit is false.
Upon notice by CMSI that any legal or beneficial interest in any portion of a
Residual Certificate has been transferred, directly or indirectly, to a
disqualified organization or an Agent in contravention of the foregoing
restrictions, the Trustee shall furnish to the Internal Revenue Service and the
transferor of such Residual Certificate or to such Agent, within 60 days of the
request therefor by such transferor or such Agent, and CMSI agrees to provide
the Trustee with the computation of. such information necessary to the
application of Code Section 860E(e) as may be required by the Code, including
but riot limited to the present value of the total anticipated excess inclusions
with respect to such Residual Certificate (or portion thereof) for periods after
such transfer. At the election of CMSI, the reasonable cost of computing and
furnishing such information may be charged to the transferor or such Agent;
however, the Trustee and CMSI shall in no event be excused from furnishing such
information. Every holder of a Residual Certificate shall be deemed to have
consented to such amendments to the Pooling Agreement as may be required to
further effectuate the restrictions on transfer of Residual Certificates to a
disqualified organization, an Agent, an ERISA Prohibited Holder or a
Non-permitted Foreign Holder.
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The affidavit described in the preceding paragraph shall also contain
the statement of the transferee that it (i) has historically paid its debts as
they have come due and intends to do so in the future, (ii) understands that it
may incur liabilities in excess of cash flows generated by the Residual
Certificate, (iii) intends to pay taxes associated with holding the Residual
Certificate as they become due and (iv) will not transfer the Residual
Certificate to any person or entity that does not provide a similar affidavit.
The transferor's statement to the Trustee accompanying the affidavit shall state
that the transferor has no knowledge or reason to know that the statements made
by the transferee with respect to clauses (i) and (iii) of the preceding
sentence are false. Each Residual Certificate shall bear a legend referring to
the restrictions contained in this paragraph and the preceding paragraph.
Notwithstanding the foregoing, no transfer of a Class A-IO Certificate
or a Class B-3, Class B-4 and Class B-5 CitiCertificate or Residual Certificate
may be made unless such Class A-IO Certificate, Class B-3, Class B-4 and Class
B-5 CitiCertificate or Residual Certificate has been registered under the Act
and applicable state securities or "blue sky" laws, or an exemption from the Act
and applicable state securities or "blue sky" laws is available. Upon surrender
for registration of transfer of any Class A-IO Certificate, Class B-3, Class B-4
and Class B-5 CitiCertificate or Residual Certificate, (1) the Trustee shall not
accept surrender for transfer or registration of transfer of, or register the
transfer of, any Class A-IO Certificate, Class B-3, Class B-4 and Class B-5
CitiCertificate or Residual Certificate and (2) CMSI shall not execute, and the
Trustee shall not authenticate and deliver, any new Class A-IO Certificate,
Class B-3, Class B-4 and Class B-5 CitiCertificate or Residual Certificate in
connection with the transfer of any Class A-IO Certificate, Class B-3, Class B-4
and Class B-5 CitiCertificate or Residual Certificate, unless either (A) such
Class A-IO Certificate, Class B-3, Class B-4 and Class B-5 CitiCertificate or
Residual Certificate has been registered under the Act and applicable state
securities or "blue sky" laws, or (B) exemptions from the registration
requirements of the Act and applicable state securities or "blue sky" laws are
available, and the transferee delivers to the Issuer and the Trustee a letter
substantially to the effect set forth in Exhibit E to this Agreement and (1) if
such transferee is not a "Qualified Institutional Buyer" within the meaning of
Rule 144A of the Act, and if so requested by CMSI, in its sole discretion, an
opinion of counsel acceptable to CMSI shall have been delivered to CMSI and the
Trustee to the effect that such transfer is in compliance with either subclause
(A) or subclause (B) of this clause (i) of this Section 5.02; or (2) if such
transfer is to a non-institutional investor, unless such investor is an
accredited investor (as defined in Regulation D under the Act), has a net worth
(exclusive of primary residence) of at least $1,000,000 as confirmed in writing
to the Trustee.
No transfer of a Class M CitiCertificate or a Class B CitiCertificate
may be made unless any proposed transferee (i) executes a representation letter
in substantially the form of Exhibit F hereto and in substance satisfactory to
the Trustee and the Issuer either stating (a) that it is not, and is not acting
on behalf of, any employee benefit plan subject to the fiduciary responsibility
provisions of ERISA or Section 4975 of the Code, or a governmental plan, as
defined in Section 3(32) of ERISA, subject to any federal, state or local law
("Similar Law") which is, to a material extent, similar to the foregoing
provisions of ERISA or the Code (collectively, a "Plan") or using the assets of
any such Plan to effect such purchase or (b) it is an insurance company and the
source of funds used to purchase the Class M CitiCertificates or the Class B
CitiCertificates is an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTE
95-60"), 60 Fed. Reg. 35925 (July 12, 1995) and there is no Plan with respect to
which the amount of such general accounts reserves and liabilities for the
contracts) held by or on behalf of such Plan and all other Plans maintained by
the same employer (or affiliate thereof as defined in Section V(a)(1) of PTE
95-60) or by the same employer (or affiliate thereof as defined in Section
V(a)(1) of PTE 95-60) or by the same employee organization, exceed 10% of the
total of all reserves and liabilities of such general account (as such amounts
are determined under Section I(a) of PTE 95-60) at the date of acquisition or
(ii) provides an opinion of counsel in form and substance satisfactory to the
Trustee and the Issuer that the purchase or holding of such Class M
CitiCertificate or Class B CitiCertificate, as the case may be. by or on behalf
of such Plan will not result in the assets of the Trust being deemed to be "plan
assets" and subject to the prohibited transaction provisions of
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ERISA and the Code or Similar Law and will not subject the Master Servicer,
Servicer, CMSI or the Trustee to any obligation in addition to those undertaken
in this Agreement.
No transfer of a Class A-IO Certificate may be made unless any proposed
transferee (i) executes a representation letter in form and substance
satisfactory to the Trustee and the Issuer either stating (a) that it is not,
and is not acting on behalf of, any employee benefit plan subject to the
fiduciary responsibility provisions of ERISA or Section 4975 of the Code, or a
governmental plan, as defined in Section 3(32) of ERISA, subject to any federal,
state or local law ("Similar Law") which is, to a material extent, similar to
the foregoing provisions of ERISA or the Code (collectively, a "Plan") or using
the assets of any such Plan to effect such purchase or (ii) provides an opinion
of counsel in form and substance satisfactory to the Trustee and the Issuer that
the purchase or holding of such Class A-IO Certificate by or on behalf of such
Plan will not result in the assets of the Trust being deemed to be "plan assets"
and subject to the prohibited transaction provisions of ERISA and the Code or
Similar Law and will not subject the Master Servicer, Servicer, CMSI or the
Trustee to any obligation in addition to those undertaken in this Agreement.
Section 5.03. Mutilated, Destroyed, Lost or Stolen Certificates. If (a)
any mutilated Certificate is surrendered to the Certificate Registrar or the
Certificate Registrar receives evidence to its satisfaction of the destruction,
loss or theft of any Certificate and (b) there is delivered to CMSI, the
Certificate Registrar and the Trustee such security or indemnity as may be
required by them to save each of them harmless, then, in the absence of notice
to the Certificate Registrar or the Trustee that such Certificate has been
acquired by a bona fide purchaser, CMSI shall execute and the Trustee or
Authenticating Agent shall authenticate and deliver, in exchange for or in lieu
of such mutilated, destroyed, lost or stolen Certificate, a new Certificate of
like tenor and Initial Stated Amount, initial notional amount or Percentage
Interest. In connection with the issuance of any new Certificate under this
Section 5.03, the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee and the Certificate Registrar) connected therewith. Any duplicate
Certificate issued pursuant to this Section 5.03 shall constitute complete and
indefeasible evidence of ownership in the Trust Fund, as if originally issued on
the Issue Date, whether or not the lost, stolen or destroyed Certificate shall
be found at any time.
Section 5.04. Persons Deemed Owners. Prior to due presentation of a
Certificate for registration of transfer, CMSI, the Trustee, the Certificate
Registrar and any agent of CMSI, the Trustee or the Certificate Registrar may
treat the Person in whose name such Certificate is registered as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
3.03 and for all other purposes whatsoever, and neither CMSI, the Trustee, the
Certificate Registrar nor any agent of CMSI, the Trustee or the Certificate
Registrar shall be affected by any notice to the contrary.
Section 5.05. Access to List of Certificateholders' Names and
Addresses. If the Trustee is not the Certificate Registrar and at any time
requests CMSI or the Certificate Registrar in writing to provide a list of the
names and addresses of Certificateholders, CMSI will furnish or (if the
Certificate Registrar is not CMSI) cause the Certificate Registrar to furnish to
the Trustee, within 15 days after receipt of a request, such list as of the most
recent Record Date, in such form as the Trustee may reasonably require. If three
or more Certificateholders (i) request such information in writing from die
Trustee, (ii) state that such Certificateholders desire to communicate with
other Certificateholders with respect to their rights under this Agreement or
under the Certificates and (iii) provide a copy of the communication which such
Certificateholders propose to transmit, then the Trustee shall, within five
Business Days after the receipt of such request, afford such Certificateholders
access during normal business hours to the most recent list held by the Trustee,
if any. If such list is as of a date more than 90 days prior to the date of
receipt of such Certificateholders' request, the Trustee shall promptly request
from CMSI or the Certificate Registrar a current list and shall afford such
Certificateholders access to such list promptly upon its receipt by the Trustee.
Every Certificateholder, by receiving and holding a Certificate, agrees that
neither
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CMSI, the Certificate Registrar nor the Trustee shall be held accountable by
reason of the disclosure of any such information as to the list of the
Certificateholders hereunder, regardless of the source from which such
information was derived.
Section 5.06. Definitive Certificates. If (i)(A) the Servicer advises
the Trustee in writing that the Clearing Agency is no longer willing or able
properly to discharge its responsibilities as depository with respect to the
Book-Entry Certificates, and (B) the Servicer is unable to locate a qualified
successor, (ii) the Servicer, at its option, advises the Trustee in writing that
it elects to terminate the book-entry system through the Clearing Agency or
(iii) after the occurrence of dismissal or resignation of the Servicer,
Beneficial Owners representing an aggregate Stated Amount of not less than 51%
of the aggregate Voting Interest of each outstanding Subclass of Book-Entry
Certificates advise the Trustee through the Clearing Agency and Clearing Agency
Participants in writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interests of the Beneficial Owners, the
Trustee shall notify the Beneficial Owners, through the Clearing Agency, of the
occurrence of any such event and of the availability of Definitive Certificates
to Beneficial Owners requesting the same. Upon surrender to the Trustee by the
Clearing Agency of the CitiCertificates held of record by its nominee,
accompanied by re-registration instructions and directions to execute and
authenticate new CitiCertificates from CMSI, the Trustee shall execute and
authenticate Definitive Certificates for deliver, at its Corporate Trust Office.
CMSI shall arrange for, and will bear all costs of, the printing and issuance of
such Definitive Certificates. Neither CMSI, the Servicer nor the Trustee shall
be liable for any delay in delivery of such instructions by the Clearing Agency
and may conclusively rely on, and shall be protected in relying on. such
instructions.
Section 5.07. Notices to Clearing Agency. Whenever notice or other
communication to the Holders of Book-Entry Certificates is required under this
Agreement, unless and until Definitive Certificates shall have been issued to
Beneficial Owners pursuant to Section 5.06, the Trustee shall have all such
notices and communications specified herein to be given to Holders of Book-Entry
Certificates to the Clearing Agency.
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ARTICLE VI
CMSI
Section 6.01. Liability of CMSI. CMSI shall be liable in accordance
herewith only to the extent of the obligations specifically undertaken by CMSI
herein.
Section 6.02. Merger or Consolidation of, or Assumption of the
Obligations of, CMSI. Any corporation into which CMSI may be merged or
consolidated, or any corporation resulting from an, merger, conversion or
consolidation to which CMSI shall be a party, or any corporation succeeding to
the business of CMSI, or any corporation, more than 50% of the voting stock of
which is, directly or indirectly, owned by Citicorp, which executes an agreement
of assumption to perform every obligation of CMSI hereunder, shall be the
successor of CMSI hereunder, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding; provided, that in the event that any such successor
corporation executes such agreement of assumption, CMSI shall not thereby be
released from any of its obligations or liabilities hereunder.
Section 6.03. Limitation on Liability of CMSI and Others. Neither CMSI
nor any of its directors, officers, employees and agents shall be under any
liability to the Trust Fund or the Certificateholders for any action taken or
for refraining from the taking of any action pursuant to this Agreement, or for
errors in judgment, provided, however, that neither CMSI nor any such person
will be protected against any liability which would otherwise be imposed by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder. CMSI and any director or officer or employee or agent of any of it
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. CMSI and
any of its directors, officers, employees or agents shall be indemnified and
held harmless by the Trust Fund against any loss, liability or expense incurred
in connection with any suit in equity, action at law or other proceedings
relating to this Agreement or the Certificates, other than any loss, liability
or expense incurred by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties hereunder or reckless disregard of
obligations and duties hereunder. CMSI shall not be under any obligation to
appear in, prosecute or defend any legal action which is not incidental to its
duties to service the Mortgage Loans in accordance with this Agreement and which
in its respective opinion may involve it in any expense or liability, provided,
however, that CMSI may in its sole discretion undertake any such action which it
may deem necessary or desirable in respect of this Agreement and the rights and
duties of the parties hereto and the interests of the Certificateholders
hereunder. In such event, the legal expenses and costs of such whom and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Trust Fund and CMSI shall be entitled to be reimbursed therefor out of the
Certificate Account.
Section 6.04. CMSI Not to Resign. Subject to the provisions of Sections
6.02 and 6.06, CMSI shall not resign from the obligations and duties hereby
imposed on it without the consent of the Trustee, the Holders of more than
66-2/3% of the Stated Amount of the CitiCertificates then Outstanding and
66-2/3% of the Percentage Interests of the Residual Certificates, except upon a
determination that the performance of its duties hereunder is no longer
permissible under applicable law. Any such determination permitting the
resignation of CMSI shall be evidenced by an Opinion of Counsel to such effect
delivered to the Trustee. No resignation by CMSI shall become effective until
the Trustee or a successor servicer and master servicer shall have assumed the
responsibilities and obligations of CMSI in accordance with Section 7.02.
Section 6.05. Maintenance of Office or Agency. CMSI shall maintain or
cause to be maintained at its expense an office or offices or agency or agencies
where the Certificates may be surrendered for registration of transfer or
exchange and where notices and demands to or upon CMSI in respect of the
Certificates and this Agreement may be served. CMSI initially appoints the
Certificate Registrar designated in Article XII as its office
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for purposes of receipt of notices and demands. CMSI will give prompt written
notice to the Trustee and to the Certificateholders of any change in the
location of the Certificate Register or any such office or agency.
Section 6.06. Delegation of Duties. CMSI may at any time without notice
or consent delegate any duties hereunder to any entity, including an entity more
than 50% of the stock of which is owned, directly or indirectly, by Citicorp;
provided that such entity has been approved as a seller/servicer by the Federal
Housing Administration, the Government National Mortgage Association ("GNMA"),
FNMA or FHLMC. Such delegation shall not, however, relieve CMSI of its
responsibility with respect to such duties.
Section 6.07. Insurance. CMSI shall, for so long as it acts as Servicer
and Master Servicer under this Agreement, maintain in force (i) a policy or
policies of insurance covering errors and omissions in the performance of its
obligations as servicer hereunder, and (ii) a fidelity bond in respect of its
officers, employees and agents. Each such policy or policies and bond shall,
together, comply with the requirements from time to time of FNMA or FHLMC for
persons performing servicing for mortgage loans purchased by such association.
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ARTICLE VII
DEFAULT
Section 7.01. Events of Default. If any one of the following events
("Events of Default") shall occur and be continuing:
(a) Any failure by CMSI, if CMSI is the Paying Agent, to distribute to
Certificateholders any payment required under the terms of this Agreement
(including any payment required to be made by CMSI pursuant to Section 3.25
hereof) or, if CMSI is not the Paving Agent, to pay over or to cause to be paid
over to the Paying Agent for such distribution, any payment so required or to
remit to the Trustee for deposit in the Certificate Account any payment required
to be made under the terms of this Agreement (including any payment required to
be made by CMSI pursuant to Section 3.25 hereof) which failure continues
unremedied for a period of (A) 10 Business Days after the date on which written
notice of such failure shall have been given to CMSI by or on behalf of the
Trustee, or to CMSI and the Trustee, by the Holders of the Required Amount of
the Certificates if CMSI falls to distribute or remit the full amount of a
required payment as the result of an error in calculating the amount of such
required payment or (B) 3 Business Days after written notice of such failure
shall have been given to CMSI as provided above if CMSI falls to distribute or
remit the full amount of a required payment for any reason other than as a
result of an error in calculation; or
(b) Failure on the part of CMSI to repurchase any Mortgage Loan as
required pursuant to Section 2.02 or 2.03 or to reimburse any Trustee Advance as
required pursuant to 8.13 hereof which continues unremedied for a period of 60
Business Days after the date upon which written notice of such failure shall
have been given to CMSI by or on behalf of the Trustee, or to CMSI and the
Trustee, by the Holders of the Required Amount of Certificates; or
(c) Failure on the part of CMSI duty to observe or perform in any
material respect any other covenants or agreements of CMSI set forth in the
Certificates or in this Agreement, which failure (A) materially affects the
rights of the Certificateholders and (B) continues unremedied for a period of 60
Business Days after the date on which written notice of such failure, requiring
the same to be remedied, shall have been given to CMSI by or on behalf of the
Trustee, or to CMSI and the Trustee, by the Holders of the Required Amount of
CitiCertificates; or
(d) The entry of a decree or order by a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
conservator, receiver or liquidator for CMSI in any insolvency, readjustment of
debt, marshaling of assets and liabilities or similar proceedings, or for the
winding up or liquidation of its affairs, and the continuance of any such decree
or order unstayed and in effect for a period of 60 consecutive days; or
(e) CMSI shall consent to the appointment of a conservator or receiver
or liquidator in any insolvency readjustment of debt, marshaling of assets and
liabilities or similar proceedings of or relating to CMSI or of or relating to
substantially all of its property, or CMSI 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;
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, the Trustee or the Holders of the Required Amount of
Certificates, by notice then given in writing to CMSI (and to the Trustee if
given by the Certificateholders) may terminate all of the rights and obligations
of CMSI as Servicer of the Affiliated Mortgage Loans and as Master Servicer of
the CitiMae Mortgage Loans under this Agreement. On and after the receipt by
CMSI of such written notice, all authority and power of CMSI under this
Agreement,
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whether with respect to the Certificates or the Mortgage Loans or otherwise,
shall pass to and be vested the Trustee pursuant to and under this Section 7.01;
and, without limitation, the Trustee is hereby authorized and empowered to
execute and deliver, on behalf of CMSI 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 the Mortgage
Loans and related documents or otherwise. CMSI agrees to cooperate with the
Trustee in effecting the termination of the responsibilities and rights of CMSI
hereunder, including, without limitation, the transfer to the successor servicer
for the administration by it of all cash amounts which shall at the time be held
by CMSI for deposit, or have been deposited by CMSI, in the Certificate Account
or Servicing Account or which shall thereafter be received with respect to the
Mortgage Loans. In addition to any other amounts which are then payable, or,
notwithstanding the termination of its activities as servicer and master
servicer of the Mortgage Loans, may become payable to CMSI under this Agreement
CMSI shall be entitled to receive out of any delinquent payment on account of
interest on a Mortgage Loan, due during the period prior to the notice pursuant
to this Section 7.01 which terminates the obligation and rights of CMSI
hereunder and received after such notice, that portion of such payment which it
would have received if such notice had not been given.
Section 7.02. Trustee to Act; Appointment of Successor. On and after
the time CMSI receives a notice of termination pursuant to Section 7.01, the
Trustee shall be the successor in all respects to CMSI in its capacity as
servicer and master servicer under this Agreement and the transactions set forth
or provided for herein and shall be subject to all the responsibilities, duties,
limitations on liabilities and liabilities relating thereto placed on CMSI by
the terms and provisions hereof As compensation therefor, the Trustee shall,
except as provided in Section 7.01, be entitled to such compensation (whether
payable out of the Certificate Account or otherwise) as CMSI would have been
entitled to hereunder if no such notice of termination had been given.
Notwithstanding the above, the Trustee may, if it shall be unwilling so to act,
or shall, if it is legally unable so to act, appoint, or petition a court of
competent jurisdiction to appoint, any established housing finance institution
having a net worth of not less d $5,000,000 and approved as seller/servicer by
GNMA, FNMA or FHLMC as the successor to CMSI hereunder in the assumption of all
or any part of the responsibilities, duties or liabilities of CMSI hereunder.
The Trustee or successor to CMSI appointed hereunder shall not, however, be
required to advance funds held in the Certificate Account or elsewhere, or to
repurchase Mortgage Loans. Pending appointment of a successor to CMSI 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 Trustee may make such arrangements for the compensation of such
successor out of payments on the Mortgage Loans as it and such successor shall
agree; provided, however, that no such compensation shall be in excess of that
permitted CMSI hereunder. The Trustee and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession.
Any successor to CMSI as servicer and master servicer shall during the
term of its service as servicer and Master Servicer maintain in force the policy
or policies which CMSI is required to maintain pursuant to Section 6.07.
Section 7.03. Notification to Certificateholders. Upon any, termination
or appointment of a successor to CMSI pursuant to this Article VII, the Trustee
shall give or cause to be given prompt written notice thereof to the
Certificateholders at their respective addresses appearing in the Certificate
Register.
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ARTICLE VIII
THE TRUSTEE
Section 8.01. Duties of the Trustee. The Trustee, prior to the
occurrence of an Event of Default and after the curing of all Events of Default
which may have occurred, undertakes to perform such duties and only such duties
as are specifically set forth in this Agreement. If an Event of Default has
occurred (which has not been cured), the Trustee shall exercise such of the
rights and powers vested in it by this Agreement, and use the same degree of
care and skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs. If the Trustee is
incorporated or organized under the laws of the State of New York, then, in
considering what actions are or are not prudent in the circumstances, to the
extent applicable, the Trustee shall consider the matters enumerated in Section
126(2)(a) through (e) of the New York Real Property Law, as such law is in
effect on the date of this Agreement, and in addition, the Trustee shall comply
with the provisions of subdivisions (3),(4) and (5) of Section 126 of the New
York Real Property Law, as such law is in effect on the date of this Agreement,
which provisions are hereby incorporated by reference in this Agreement if
herein set forth in full.
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.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(a) Prior to the occurrence of an Event of Default, and after the
curing of all such Events of Default which may have occurred, the duties and
obligations of the Trustee shall be determined solely by the express provisions
of this Agreement, the Trustee shall not be liable except for the performance of
such duties and obligations as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the Trustee, the Trustee
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon if any certificates, statements, or
opinions furnished to the Trustee and conforming to the requirements of this
Agreement;
(b) The Trustee shall not be personally liable for an error of judgment
made in good faith by a Responsible Officer of the Trustee, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent facts;
(c) The Trustee shall-not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Holders of the Required Amount of Certificates
relating to the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred upon
the Trustee, under this Agreement;
(d) The Trustee shall not be charged with knowledge of any default
(other than a default in payment to the Trustee) specified in clauses (i), (ii)
and (iii) of Section 7.01 or an Event of Default under clause (iv) or (v) unless
a Responsible Officer of the Trustee assigned to and working in the Corporate
Trust Office obtains actual knowledge of such failure or the Trustee receives
written notice of such failure at its Corporate Trust Office from CMSI or the
Holders of the Required Amount of Certificates.
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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, mid
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 CMSI under this Agreement, except during such time, if
any, as the Trustee shall be the successor to, and be vested with the rights,
duties, powers and privileges of, CMSI in accordance with the terms of this
Agreement.
Section 8.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 8.01:
(a) The Trustee may rely and shall be protected in acting, or
refraining from acting upon any resolution, Officer's Certificate, certificate
of auditors or any other certificate, statement, instruments, opinion. report,
notice, request, consent, order, appraisal, bond or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) The Trustee may consult with counsel and any 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 Opinion of Counsel;
(c) Whenever in the administration of this Agreement the Trustee or its
agent shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, including any action by the
Trustee pursuant to Section 10.01 hereof, the Trustee or its agent (unless other
evidence be herein specifically prescribed) may request and, in the absence of
bad faith on its part, rely upon any Officer's Certificate;
(d) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct or
defend any litigation hereunder or in relation hereto, at the request, order or
direction of any of the Certificateholders, pursuant to the provisions of this
Agreement, unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligations, upon the occurrence of an Event
of Default (which has not been cured), to exercise such of the rights and powers
vested in it by this Agreement, and to use the same degree of care and skill in
their exercise as a prudent man would exercise or use under the circumstances in
the conduct of his own affairs;
(e) The Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement;
(f) Prior to the occurrence of an Event of Default and after the curing
of all Events of Default which may have occurred, the Trustee shall not be bound
to make any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, approval bond or other paper or documents, unless requested in writing so
to do by the Holders of the Required Amount of Certificates; provided, however,
that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Agreement, the
Trustee may require reasonable indemnity against such cost, expense or liability
as a condition to such proceeding. The reasonable expense of every such
examination shall be paid by CMSI or, if paid by the Trustee, shall be
reimbursed by CMSI upon demand. Nothing in this clause (vi) shall derogate the
obligation of CMSI to observe any applicable law prohibiting disclosure of
information regarding the Mortgagors; and
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(g) The Trustee may appoint agents (which may include the Issuer and
its affiliates) to perform any of the responsibilities of the Trustee, which
agents shall have any or all of the rights, powers, duties and obligations of
the Trustee conferred on them by such appointment, provided that the Trustee
shall continue to be responsible for its duties and obligations under this
Agreement.
Section 8.03. Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
certificate of authentication on the Certificates) shall be taken as the
statements of CMSI 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 certificate
of authentication on the Certificates) or of any Mortgage Loan or related
document. The Trustee shall not be accountable for the use or application by
CMSI of any of the Certificates or of the proceeds of such Certificates or for
the use or application of any funds paid to CMSI in respect of the Mortgage
Loans or deposited in or withdrawn from the Certificate Account or Servicing
Account by CMSI. The Trustee shall have no liability for any losses incurred as
a result of (i) any failure of the Trust Fund to qualify as two REMICs, (ii) any
termination, inadvertent or otherwise, of the status of the Trust Fund as two
REMICs, (iii) any tax on prohibited transactions imposed by Code Section
860F(a)(1), (iv) any tax on net income from foreclosure property imposed by Code
Section 860G(c), (v) any tax on contributions to a REMIC after the Startup Day
imposed by Code Section 860G(d), (vi) any erroneous calculation or determination
or any act or omission of CMSI hereunder or (vii) any erroneous information
included in any federal, state or local income tax or information return
prepared pursuant to Section 3.06; provided, that the Trustee shall not be
excused hereby from liability for its own negligence, bad faith or failure to
perform its duties as specified herein.
Section 8.04. Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of one or more
of the Certificates with the same rights as it would have if it were not Trustee
and may otherwise deal with CMSI or any of its Affiliates as if it were not the
Trustee.
Section 8.05. Trustee's Fees and Expenses. Trustee's fees and expenses
(and those of any co-trustee appointed pursuant to Section 8.10), any
Co-Certificate Registrar, any Note Custodian, Mortgage Document, Custodian,
Depository, any Co-Paying Agent, any Authenticating Agent appointed pursuant to
Section 8.12 and any other agent of the Trustee appointed pursuant to Section
8.02 shall be paid by CMSI. as Servicer in accordance with Article XII. In
consideration of paying the amounts payable pursuant to this Section 8.05, CMSI
may retain the Trustee Fee payable with respect to the CitiMae Mortgage Loans.
The Trustee (and any such co-trustee) shall be entitled to reasonable
compensation (which shall not be limited by any provision of law with respect to
the compensation of a trustee of an express trust) for all services rendered by
them in the execution of the trust or trusts hereby created and in the exercise
and performance of any of the powers and duties hereunder of the Trustee, and
upon notice to CMSI, the Trustee will be paid or reimbursed by CMSI 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 its negligence or bad faith or which is the
responsibility of the Certificateholders hereunder.
The Trustee, each Co-Certificate Registrar, each Note Custodian, each
Mortgage Document Custodian, each Depository, each Co-Paying Agent, each
Authenticating Agent and any agent appointed pursuant to Section 8.02 are
entitled to indemnification from CMSI, as Servicer or Master Servicer, and will
be held harmless against any loss, liability or expense incurred without
negligence or bad faith on their part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses of defending themselves against any claim or liability in
connection with the exercise or performance of any of their powers or duties
hereunder. Such indemnification shall survive the payment of the Certificates
and termination of the Trust Fund, as well as the resignation or removal of
CMSI, as Servicer, (if such action which caused the need for the indemnification
occurred while CMSI acted as Servicer) and for purposes of such indemnification
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neither the negligence nor bad faith of any of the entities enumerated in the
preceding sentence shall be imputed to, or adversely affect, the right of any
other enumerated person to be entitled to indemnification.
Section 8.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be a corporation or a national banking association,
other than an Affiliate of CMSI, having its principal office in the same state
as that in which the initial Trustee under this Agreement has its principal
office (or in the State of New York) and organized and doing business under the
laws of such State or the United States of America, authorized under such laws
to exercise corporate trust powers, having a combined capital and surplus of at
least $30,000,000 and subject to supervision or examination by federal or state
authority. If such corporation or national banking association publishes reports
of condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section 8.06, the combined capital and surplus of such corporation or national
banking association shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. In case at any
time the Trustee shall cease to be eligible in accordance with the provisions of
this Section 8.06, the Trustee shall resign immediately in the manner and with
the effect specified in Section 8.07.
Section 8.07. Resignation or Removal of Trustee. The Trustee may at any
time resign and be discharged from the trusts hereby created by giving written
notice thereof to CMSI. Upon receiving such notice of resignation, CMSI 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 provision of Section 8.06 and shall fail to resign after written
request therefor by CMSI, or if at any time the Trustee shall be legally unable
to act, or shall be adjudged a bankrupt or insolvent, or a receiver of the
Trustee or of its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation, conversion or liquidation, then CMSI may remove the Trustee.
If it removes the Trustee under the authority of the immediately preceding
sentence, CMSI shall promptly appoint a successor Trustee by written instrument,
in duplicate, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor Trustee.
The Trustee may also be removed at any time (i) by the Issuer, (a) if
the Trustee ceases to be eligible to continue as such under the Pooling
Agreement or if the Trustee becomes insolvent, (b) if the Trustee breaches any
of its duties under the Pooling Agreement which materially adversely affects the
Certificateholders, (c) if through the performance or nonperformance of certain
actions by the Trustee, the rating assigned to the CitiCertificates would be
lowered or (d) if the credit rating of the Trustee is downgraded to a level
which would result in the rating assigned to the CitiCertificates to be lowered;
or (ii) by the holders of Certificates evidencing more than 50% of the Voting
Interest of the CitiCertificates and the Class A-IO Certificates then
outstanding and more than 50% of the Percentage Interests of the Residual
Certificates.
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 CMSI and to
its predecessor Trustee an instrument accepting such appointment hereunder
(including the duties of the Trustee, in its individual capacity, as stated in
Section 8.13 and, if applicable, Section 8.14 herein), and thereupon the
resignation or removal of the predecessor Trustee shall
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become effective and such successor Trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder with like effect as if originally named
as Trustee. The predecessor Trustee shall deliver to the successor Trustee all
Mortgage Files and related documents and statements held by it hereunder; and,
if any Mortgage Notes or Mortgage Documents are then held by the Mortgage Note
Custodian or Mortgage Document Custodian, respectively, pursuant to a Custodial
Agreement, the predecessor Trustee and the Mortgage Note Custodian or the
Mortgage Document Custodian, as the case may be, shall amend such Custodial
Agreement to make the successor Trustee the successor to the predecessor Trustee
thereunder; and CMSI and the predecessor Trustee shall execute and deliver such
instruments and do other such things as may reasonably be required for fully and
certainly vesting and confirming in the successor Trustee all such rights,
powers, duties and obligations.
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.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 8.08, CMSI shall mail notice of the succession of such Trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register. If CMSI fails to mail such notice within 10 days after
acceptance of appointment by the successor Trustee, the successor Trustee shall
cause such notice to be mailed at the expense of CMSI.
Section 8.09. Merger or Consolidation of Trustee. Any corporation or
national banking association into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation or national banking
association resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation or national banking association
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such
corporation or national banking association shall be eligible under the
provisions of Section 8.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust Fund or property securing any Mortgage Note may at the time be
located, CMSI and the Trustee acting jointly shall have the power and shall
execute and deliver all instruments to appoint one or more Persons approved by
the Trustee to act as co-trustee or co-trustees jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust Fund, and
to vest in such Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the Trust Fund, or any part thereof, and,
subject to the other provisions of this Section 8.10, such powers, duties,
obligations, rights and trusts as CMSI and the Trustee may consider necessary
and desirable. If CMSI 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 an Event of
Default shall have occurred and be continuing, the Trustee alone shall have the
power to make such appointment. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 8.06 and no notice to the Certificateholders of the appointment of any
co-trustee or separate trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted by
law and by the instrument appointing such separate trustee or co-trustee, be
appointed and act subject to the following provisions and conditions:
(a) All rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or performed
by the Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Trustee joining such act), except to the extent that
under any law of any jurisdiction in which any particular act
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or acts are to be performed (whether as Trustee hereunder or as successor to
CMSI hereunder), the Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust Fund or any portion thereof in any
such jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Trustee;
(b) No trustee hereunder shall be held personally liable by reason of
any act or omission of any other trustee hereunder; and
(c) CMSI and the Trustee acting jointly may at any time accept the
resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either Jointly with the Trustee or separately,
as may be provided therein, subject to all of the provisions of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee and a
copy thereof given to CMSI.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die. become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee to the extent permitted by law, without the appointment of a new or
successor trustee.
Section 8.11. Tax Returns. The Trustee, upon request, will furnish CMSI
with all such information as may be reasonably required in connection with the
preparation of all federal, state and local income tax or information returns of
the Upper-Tier REMIC and the Lower-Tier REMIC.
Section 8.12. Appointment of Authenticating Agent. At any time when any
of the Certificates remain outstanding the Trustee may appoint an Authenticating
Agent or Agents (which may include CMSI or any of its affiliates) which shall be
authorized to act on behalf of the Trustee to authenticate Certificates, and
Certificates so authenticated shall be entitled to the benefit of this Agreement
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference made in this Agreement to the
authentication and delivery of Certificates by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to CMSI and
shall at all times be a corporation or national banking association organized
and doing business under the laws of the United States of America, any state
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$15,000,000, authorized under such laws to do a trust business and subject to
supervision or examination by federal or state authority. If such Authenticating
Agent publishes reports of condition at least annually, pursuant to law or to
the requirements of said supervising or examining authority, then for the
purposes of this Section 8.12, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 8.12, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section 8.12.
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Any corporation or national banking association into which an
authenticating Agent may be merged in or converted or with which it may be
consolidated, or any corporation or national banking association resulting from
any merger, conversion or consolidation to which such Authenticating Agent shall
be a party, or any corporation or national banking association succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation or national
banking association shall be otherwise eligible under this Section 8.12, without
the execution or filing of any paper or any further act on the part of the
Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to CMSI. The Trustee may at any time terminate the
agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to CMSI. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time such Authenticating Agent shall
cease to be eligible in accordance with the Authenticating Agent which shall be
provisions of this Section 8.12, the Trustee may appoint a successor acceptable
to CMSI and shall mail written notice of such appointment by first-class mail,
postage prepaid to all Certificateholders as their names and addresses appear in
the Certificate Register. Any successor Authenticating Agent upon acceptance of
its appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 8.12.
Any reasonable compensation paid to an Authenticating Agent for its
services under this Section 8.12 shall be a reimbursable expense pursuant to
Section 8.05 if paid by the Trustee.
If an appointment is made pursuant to this Section 8. 12, the
Certificates may have endorsed thereon, in addition to the Trustee's certificate
of authentication, an alternate certificate of authentication in the following
form:
"This is one of the Certificates referred to in the within-mentioned
Agreement.
_______________________
As Trustee
By_______________________
Authenticating Agent
By_______________________
Authenticating Signature"
Section 8.13. Delinquency Advances. On any Deposit Date, the Trustee
(in its individual capacity and not as Trustee) shall deposit funds equal to the
Delinquency Amount for the related Determination Date into the Certificate
Account; provided that the Trustee (in such individual capacity) shall be
obligated to make such deposit only to the extent of funds determined by it (in
its sole discretion) to be recoverable from future Remittances, Net Recoveries
and other proceeds or collections on or in respect of the Mortgage Loans,
provided, however, die Trustee may only recover funds for Delinquency Amounts
relating to CitiMae Mortgage Loans or Affiliated Mortgage Loans from
Remittances, Net Recoveries and other proceeds relating to CitiMae Mortgage
Loans or Affiliated Mortgage Loans, respectively. CMSI shall pay to the Trustee
a servicing administration fee of $100 in respect of each Deposit Date on which
the Trustee (in such individual capacity) makes such a deposit, promptly after
CMSI receives notice thereof from the Trustee. CMSI shall also reimburse the
Trustee for the
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amount of any such deposit on the Business Day CMSI receives notice from the
Trustee of the amount thereof, provided that if such notice is received after
1:00 p.m., New York City time, on a Business Day, such reimbursement shall be
made to the Trustee on the next following Business Day, not later than 1:00 p.m.
To the extent the Trustee receives an amount on or in respect of the CitiMae
Mortgage Loans or Affiliated Mortgage Loans, respectively, identified to it as
being in respect of any such deposit, the Trustee shall repay to CMSI the amount
of such reimbursement not later than the Business Day after the Trustee receives
the same. Promptly after the Trust Fund is terminated pursuant to Article IX
hereof, CMSI shall notify the Trustee in writing of the amount of Conduit
Trustee Advances and Affiliated Trustee Advances that were not recovered from
future Remittances, Net Recoveries or other proceeds or collections on or in
respect of the CitiMae Mortgage Loans or Affiliated Mortgage Loans,
respectively. The Trustee (in such individual capacity) shall reimburse CMSI for
the amount of Conduit Trustee Advances or Affiliated Trustee Advances not so
recovered and repaid to CMSI on the next Business Day after its receipt of
notice thereof. CMSI shall furnish to the Trustee such information within CMSI's
possession with respect to the Mortgage Loans as the Trustee may require, in
order to make a determination that any advance made by the Trustee will be
recoverable.
Section 8.14. Advance Account, Trustee Failure Advances. If the Advance
Account Trigger Applicability is specified in Article XII as applicable to the
CitiCertificates, then:
(a) In the event dig an Advance Account Trigger Date occurs, the
Servicer will notify the Trustee in writing of such occurrence and, the
Servicer, the Trustee, in both its individual capacity and as Trustee, shall
enter into an agreement in a form substantially similar to that attached hereto
with the Advance Account Depository on or prior to the Advance Account Funding
Date. The Advance Account shall be in the name of the Advance Account
Depository, as trustee for the benefit of the Trustee and the Trustee, in its
individual capacity, and its permitted successors in interest ("permitted
successors"), as their interest may appear.
(b) On or prior to the Advance Account Funding Date, the Trustee, in
its individual capacity, shall pay to the Advance Account Depository, for
deposit into the Advance Account an amount in cash equal to (i) the product of
(A) 0.20% and (B) the Adjusted Balance of the Mortgage Loans as of the close of
business on the Advance Account Trigger Date or (ii) such lesser amount as
Moody's may specify.
(c) The Trustee shall, no later than 3:00 p.m., New York time, on the
Business Day preceding each Distribution Date occurring subsequent to the
Advance Account Funding Date as to which the Trustee has failed to deposit
timely a Conduit Trustee Advance or Affiliated Trustee Advance in the
Certificate Account as required by Section 8.13, submit a Notice for Payment to
the Advance Account Depository requesting a Trustee Failure Advance from the
Advance Account.
(d) The Advance Account shall be reimbursed for any Advance Account
Advance from future Remittances, Net Recoveries or other proceeds or collections
or in respect of the CitiMae Mortgage Loans or Affiliated Mortgage Loans, as
provided for in this Agreement (the aggregate of such amounts as to any
Distribution Date, the "Advance Account Reimbursement Amount").
(e) On or before each Distribution Date occurring on or after the
Advance Account Funding Date, the Servicer shall pay, to the extent of funds
available, to the Advance Account by wire transfer of immediately available
funds the Advance Account Reimbursement Amount with respect to such Distribution
Date as provided in the Agreement.
(f) On each Distribution Date, the amount in the Advance Account will
be reduced and released to the extent permitted in the Advance Account
Depository Agreement.
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(g) Notwithstanding the foregoing, an alternative method of limited
support for the Trustee's obligation to make advances in respect of the Mortgage
Loans may be provided, if such change does not cause the then current ratings of
the CitiCertificates or any outstanding Class or Subclass thereof to be lowered
by Moody's.
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ARTICLE IX
TERMINATION
Section 9.01. Termination upon Repurchase by CMSI or Liquidation of all
Mortgage Loans. The respective obligations and responsibilities of CMSI and the
Trustee created hereby and the Trust Fund created hereby shall terminate upon
(a) the repurchase by CMSI of all of the Mortgage Loans and all property
acquired in respect of any Mortgage Loan remaining in the Trust Fund at a price
equal to the sum of (i) 100% of the Adjusted Balance of each Mortgage Loan on
the first day of the month of repurchase (after giving effect to payments of
principal due on such first day) plus accrued interest at the Investor Rate for
each Mortgage Loan to but not including the Due Date in the month in which the
related distribution is made to Certificateholders, after the deduction of
unreimbursed Voluntary Advances, Advance Account Advances (other than such
payments and advances in respect of interest in excess of the Investor Rate on
the Mortgage Loans, Conduit Trustee Advances and Affiliated Trustee Advances
made prior to the month of repurchase, whereupon such Voluntary Advances,
Advance Account Advances Conduit Trustee Advances and Affiliated Trustee
Advances will be reimbursed to the Trustee or deemed reimbursed to CMSI, as the
case may be, by such deductions, and (ii) the appraised value of any acquired
property in the Trust Fund (less the good faith estimate of CMSI of liquidation
expenses to be incurred in connection with its disposal thereof), such appraisal
to be conducted by an appraiser mutually agreed upon by CMSI and the Trustee, or
(b) the later of (i) the maturity or other liquidation (or any advance with
respect thereto) of the last Mortgage Loan remaining in the Trust Fund and the
disposition of all property acquired upon foreclosure or by deed in lieu of
foreclosure of any Mortgage Loan and (ii) the payment to the Certificateholders
of all amounts in the Certificate Account required to be paid to them pursuant
to this Agreement; provided, however, that in no event shall the trust created
hereby continue beyond the expiration of 21 years from the death of the last
survivor of the lawful descendants of Joseph P. Kennedy, the late Ambassador of
the United States of America to the Court of St. James's, living on the date of
this Agreement. Such termination shall occur only in connection with a
"qualified liquidation" within the meaning of Code Section 860F(a)(4)(A),
pursuant to which the Trustee shall sell or otherwise dispose of all of the
remaining assets of the Trust Fund and make all required distributions to
Certificateholders within 90 days of the adoption of a plan of complete
liquidation. For this purpose, the notice of termination described in the next
paragraph shall be the adoption of a plan of complete liquidation described in
Code Section 860F(a)(4)(A)(i), which shall be deemed to occur on the date the
first such notice is mailed. Such date shall be specified in the final federal
income tax return of each of the Upper-Tier REMIC and the Lower-Tier REMIC
constituted by the Trust Fund. The right of CMSI to repurchase all of the
Mortgage Loans on any Distribution Date pursuant to clause (a) above shall be
conditioned upon (A) the aggregate Adjusted Balances of such Mortgage Loans, at
the time of any such repurchase and after giving effect to distributions to be
made on such Distribution Date, aggregating an amount less than 5% of the
aggregate Adjusted Balance of the Mortgage Loans as of the Cut-Off Date, which
amount is set forth in Article XII and (B) any other condition set forth in the
related Pooling Agreement. Any other method of termination or repurchase of the
Trust Fund than as set forth above must be based on the receipt by the Trustee
of an Opinion of Counsel (who may not be an employee of CMSI or of an Affiliate
of CMSI) or other evidence that such termination and repurchase will be part of
a "qualified liquidation" within the meaning of Code Section 860F(a)(4)(A), will
not adversely affect the status of the Trust Fund as two separate REMICs under
the Code and will not otherwise subject the Trust Fund to any tax.
Notice of any termination, specifying the 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 by letter to the Certificateholders mailed not earlier than 30 days
nor more than 60 days prior to such Distribution Date specifying (A) the
Distribution Date upon which final payment of the Certificates will be made upon
presentation arid surrender of the Certificates at the office therein
designated, (B) the amount of such final payment and (C) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments being
made only upon presentation and surrender of the Certificates at the office of
the
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Paying Agent therein specified. CMSI shall give such notice to the Trustee and,
if applicable, the Certificate Registrar, the Mortgage Document Custodian and
the Paying Agent at the time such notice given to the Certificateholders. In the
event such notice is given, CMSI shall deposit in the Certificate Account or the
account designated by the Paying Agent if CMSI is not the Paying Agent, on the
Business Day next preceding the Distribution Date with respect to such final
distribution, an amount equal to the final payment in respect of the
Certificates. Upon certification to the Trustee by an Authorized Officer of CMSI
following such final deposit, and delivery by CMSI of an Opinion of Counsel to
the effect that all conditions set forth in this Article IX have been met, the
Trustee shall promptly release to CMSI the Mortgage Files for the Mortgage
Loans. Any such repurchase shall occur only during the month of, and prior to
the Determination Date relating to, the Distribution Date on which such amounts
will be distributed to Certificateholders.
In the event that all of the Certificateholders shall not surrender
their Certificates for cancellation within six months after the date specified
in the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice all the Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps, or may
appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets which remain subject
hereto. Interest shall not accrue for the period of any delay in the payment of
a Certificate resulting from the failure of a Holder to surrender the
Certificate in accordance herewith.
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ARTICLE X
GENERAL PROVISIONS
Section 10.01. Amendment. This Agreement may be amended from time to
time by CMSI and the Trustee, without the consent of any of the
Certificateholders, (a) to cure any ambiguity, (b) to correct or supplement any
provisions herein or therein which may be inconsistent with any other provisions
herein or therein, (c) to add any other provisions with respect to matters or
questions arising under this Agreement. which shall not be inconsistent with the
provisions of this Agreement, (d) to comply with any requirements imposed by the
Code, (e) to establish a "qualified reserve fund" within the meaning of Code
Section 860G(a)(7)(B) or (f) to maintain the status of the Trust Fund as two
separate REMICs. This Agreement may also be amended by CMSI and the Trustee,
without Certificateholder consent, if CMSI delivers an Opinion of Counsel
acceptable to the Trustee to the effect that such amendment will not materially
adversely affect the interests of the Certificateholders. The Trustee hereby
agrees to execute and deliver any amendment to this Agreement, provided by CMSI
to it, that conforms to the applicable provisions of the preceding two sentences
of this paragraph provided, however, that the Trustee may, but shall not be
obligated to, enter into any such amendment that affects the Trustee's own
rights, duties or immunities under this Agreement or otherwise.
Except as otherwise provided in Section 4.04, this Agreement may also
be amended from time to time by CMSI and the Trustee with the consent of the
Holders of Certificates evidencing, in the aggregate, not less than 66-2/3% of
the Voting Interest of each Class of CitiCertificates or the Class A-IO
Certificates affected by such amendment (after giving effect to the first
proviso to the definition of "Outstanding" in Article I) and, if either Class of
the Residual Certificates are materially and adversely affected by such
amendment, 66-2/3% of the Percentage Interests of each of the Classes of the
Residual Certificates so affected, for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Agreement, or of modifying in any manner the rights of the Holders of the
Certificates; provided, however, that no such amendment shall, without the
consent of the Holders of all Certificates then Outstanding, (a) reduce in any
manner the amount of, or delay the timing of, collections or payments received
on Mortgage Loans or distributions which are required to be made on any
Certificate or (b) reduce the aforesaid percentage required to consent to any
such amendment. Promptly after the execution of any such amendment or consent
the Trustee shall furnish or cause to be furnished written notification of the
substance of such amendment (or a copy thereof) to each Certificateholder.
It shall not be necessary for the consent of Certificateholders under
this Section 10.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by the Certificateholders shall be subject to such reasonable
requirements as the Trustee may prescribe. Any proposed amendment is subject to
the receipt by the Trustee, at the expense of the party proposing such amendment
(or at the expense of the Trust Fund if proposed by the Trustee) that the
amendment will not cause either the Upper-Tier REMIC or the Lower-Tier REMIC to
fail to qualify as a REMIC or subject either REMIC to tax.
Section 10.02. Recordation of Agreement. This Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated and in which this Agreement may
be recorded, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by CMSI and at its expense upon request of the
Trustee, who will act at the direction of the Holders of a majority by
Percentage Interest of the Residual Certificates, but only upon request of the
Trustee accompanied by an Opinion of Counsel to the effect that such recordation
materially and beneficially affects the interests of the Certificateholders;
provided, however, that CMSI shall not be required to effect recordation of this
Agreement unless, prior thereto, CMSI shall have become obligated to record each
assignment relating to the Mortgages pursuant to Section 2.01 hereto.
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For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 10.03. Limitation on Rights of Certificateholders. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
commence any proceeding in any court for a partition or winding up of the Trust
Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
No Certificateholder shall have any right to vote (except as provided
in Section 10.01) or in any manner otherwise control the operation and
management of the Trust Fund or the obligations of the parties hereto, nor shall
anything herein set forth, or contained in the terms of the Certificates, be
construed so as to constitute the Certificateholders from time to time as
partners (except to the extent provided in Code Section 860F(e) with respect to
Holders of Residual Certificates) or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of default and of the continuance thereto as herein before provided, and unless
also the Holders of the Required Amount of Certificates shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
shall have any right in my manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder, or to enforce
any right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Certificateholders. For the protection
and enforcement of the provisions of this Section 10.03, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 10.04. Governing Law. This Agreement and the Certificates
issued pursuant to this Agreement shall be construed in accordance with the laws
of the State of New York, provided that the immunities and standards of care of
the Trustee shall be governed by the law of the jurisdiction in which is located
its Corporate Trust Office.
Section 10.05. Intention of Parties. The execution and delivery of this
Agreement shall constitute an acknowledgment by CMSI on behalf of the
Certificateholders that it intends hereby to establish and maintain (for federal
income tax purposes) two separate "real estate mortgage investment conduits"
within the meaning of Code Section 860D and CMSI is hereby granted all necessary
powers to further such intent.
Section 10.06. Notices. All communications relating to this Agreement
including all demands and notices shall be in writing and shall be deemed to
have been duly given if personally delivered at or mailed by first class mail,
to (a) in the case of CMSI, to the address for notices set forth in Article XII
and (b) in the case of the Trustee, to the address for notices set forth in
Article XII; or, as to each party, at such other address as shall be
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designated by such party in a written notice to each other party. Any notice
required or permitted to be mailed to a Certificateholder shall be given by
first class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or not
the Certificateholder receives such notice; provided that notices to the Trustee
shall be effective only upon receipt.
Section 10.07. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions 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 10.08. Assignment. Notwithstanding anything to the contrary
contained herein. except as provided in Sections 6.02, 6.04 and 6.06, this
Agreement may not be assigned by CMSI without the prior written consents of the
Trustee and the Holders of CitiCertificates aggregating not less than 66-2/3% of
the Stated Amount then Outstanding (after giving effect to the first proviso to
the definition of "Outstanding" in Article I) and 66-2/3% of the Percentage
Interests of the Residual Certificates then Outstanding.
Section 10.09. Certificates Nonassessable and Fully Paid. It is the
intention of the Trustee that the Certificateholders shall not be personally
liable for obligations of the Trust Fund, that the interests represented by the
Certificates shall be nonassessable for any losses or expenses of the Trust Fund
or for any reason whatsoever, and that the Certificates upon authentication
thereof by the Trustee pursuant to Section 2.05 are and shall be deemed fully
paid.
Section 10.10. Counterparts. This Agreement may be signed in any number
of counterparts, each of which will be deemed an original, which taken together
shall constitute one and the same instrument.
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ARTICLE XI
Section 11.01. Annual Statement as to Compliance. CMSI will deliver to
the Trustee and to each Holder of a Certificate holding Certificates
representing in excess of 50% of the Stated Amount or Percentage Interest, as
the case may be, on or before March 31 with respect to the Affiliated Mortgage
Loans and September 30 with respect to the CitiMae Mortgage Loans of each year
which begins not less than three months after the date of the initial issuance
of the Certificates, an Officer's Certificate stating that (a) a review of the
activities of CMSI during the preceding calendar year and of its performance
under this Agreement has been made under such officer's supervision and (b) to
the best of such officer's knowledge, based on such review, CMSI has fulfilled
all its obligations under this Agreement throughout such year, or if there has
been a default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and status thereof and (c) in the
case of the CitiMae Mortgage Loans, as to each Conduit Servicer, that (i) a
review of the activities of such Conduit Servicer during the preceding calendar
year and performance under the Guide has been made under such officer's
supervision, and (ii) to the best of such officer's knowledge, based on such
review, the Conduit Servicer has fulfilled all of its obligations under the
Guide throughout such year.
Section 11.02. Depositories. CMSI may at any time and from time to time
in its discretion transfer the Certificate Account, Buydown Account, if any,
Escrow Account, Custodial Accounts for P&I or Servicing Account to a bank,
savings and loan association or trust company organized under the laws of the
United States or any State thereof (an "eligible depository"). Upon such
transfer, such transferee bank, savings and loan association or trust company
shall be deemed to be a Depository with respect to the account or accounts so
transferred. In the event that the long-term debt obligations of any Depository
of the Certificate Account, Buydown Account Escrow Account, Custodial Accounts
for P&I or Servicing Account shall be rated at less than A by Fitch if Fitch is
a Rating Agency, or the short-term debt obligations of such Depository shall be
rated by S&P at less than A-1 if S&P is a Rating Agency, by Fitch at less than
F-1 if Fitch is a Rating Agency and by Moody's at less than P-1 if Moody's is a
Rating Agency and such account does not otherwise meet the requirements of this
Section 11.02, then within five Business Days of such reduction, CMSI shall (A)
transfer or direct the Trustee in writing to transfer the Certificate Account,
Buydown Account, Escrow Account, Custodial Accounts for P&I or Servicing Account
to an eligible depository the long-term debt obligations of which are not rated
by Fitch if Fitch is a Rating Agency at less than A and the short-term debt
obligations of which are not rated at less than A-1 by S&P if S&P is a Rating
Agency, F-1 by Fitch if Fitch is a Rating Agency and P-1 by Moody's if Moody's
is a Rating Agency (the "Rating Requirements"), (B) establish another account in
the corporate trust department of the Trustee or if such Trustee has a long-term
and short-term debt rating at least equal to the Rating Requirements, in any
department of the Trustee (the "Alternative Certificate Account", the
"Alternative Buydown Account" "Alternative Escrow Account", "Alternative
Custodial Accounts for P&I" or the "Alternative Servicing Account", as the case
may be) and transfer the funds from the Buydown Account to the Alternative
Buydown Account direct the Servicer or a Conduit Servicer, as applicable to
remit in accordance with this Agreement any funds deposited into the Servicing
Account, Escrow Account or Custodial Accounts for P&I to the Alternative
Servicing Account, Alternative Escrow Account or Alternative Custodial Account
for P&I, respectively, and direct the Servicer or Master Servicer to remit in
accordance with this Agreement any funds deposited into the Certificate Account
to the Alternative Certificate Account, (C) (i) cause such Depository to pledge
securities in the manner provided by applicable law or (ii) pledge or cause to
be pledged securities, which shall be held by the Trustee or its agent free and
clear of the lien of any third party, in a manner conferring on the Trustee a
perfected first lien and otherwise reasonably satisfactory to the Trustee; such
pledge in either case to secure such Depository's performance of its obligations
in respect of the Certificate Account, Buydown Account, Escrow Account,
Custodial Accounts for P&I or Servicing Account to the extent, if any, that such
obligation is not fully insured by the FDIC; provided, however, that prior to
the day a Depository or CMSI, as the case may be, pledges securities pursuant to
this subsection (C), CMSI and the Trustee shall have received the written
assurance of each Rating Agency that the pledging of such securities and any
arrangements or agreements relating thereto will not result in a reduction or
withdrawal of the then-current rating of the CitiCertificates, (D) establish
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an account or accounts or enter into an agreement so that the existing
Certificate Account, Buydown Account, Escrow Account, Custodial Accounts for P&I
or Servicing Account is supported by a letter of credit or some other form of
credit support which issuer of such letter of credit or other form of credit
support has a long-term and short-term debt rating at least equal to the Rating
Requirements; provided, however, that prior to the establishment of such an
account or the entering into of such an agreement, CMSI and the Trustee shall
have received written assurance from each Rating Agency that the establishment
of such an account or the entering into of such an agreement so that the
existing Certificate Account, Buydown Account or Servicing Account is supported
by a letter of credit or some other form of credit support will not result in a
reduction or withdrawal of the then-current rating on the CitiCertificates (E)
establish another account which constitutes an Eligible Account or (F) make such
other arrangements as to which CMSI and the Trustee have received prior written
assurance from each Rating Agency that such arrangement will not result in a
reduction or withdrawal of the then-current rating on the CitiCertificates. In
the event that the rating on the CitiCertificates has been downgraded as a
result of a rating downgrade of the Depository, for purposes of this paragraph,
the then-current rating on the CitiCertificates shall be the rating assigned to
the CitiCertificates prior to any such downgrade.
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Appendix 1
TRANSFEREE'S AFFIDAVIT
AFFIDAVIT PURSUANT TO SECTION
860E(e)(4) OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED
STATE OF )
):
COUNTY OF )
[ ], being first duly sworn, deposes and says:
1. That he is [______________] of [_____________] (the "Investor"), a
[state type of entity] duly organized and existing under the laws of the [State
of ____________] [United States], on behalf of which he makes this affidavit.
2. That the Investor's Taxpayer Identification Number is
[______________].
3. That the Investor is not a "disqualified organization" within the
meaning of Section 860E(e)(5) of the Internal Revenue Code of 1986, as amended
(the "Code") or an ERISA Prohibited Holder, and will not be a "disqualified
organization" or an ERISA Prohibited Holder as of [ ,
], and that the Investor is not acquiring a Citicorp Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 1996-1 Class [R][LR]
Certificate for the account of, or as agent (including a broker, nominee or
other middleman) for, any person or entity from which it has not received an
affidavit substantially in the form of this affidavit. For these purposes, a
"disqualified organization" means the United States, any state or political
subdivision thereof, any foreign governments any international organization, any
agency or instrumentality of any of the foregoing (other than an instrumentality
if all of its activities are subject to tax and a majority of its board of
directors is not appointed by such governmental entity), any cooperative
organization furnishing electric energy or providing telephone service to
persons in rural areas described in Code Section 1381(a)(2)(C), or any
organization (other than a farmers' cooperative described in Code Section 521)
that is exempt from federal income tax unless such organization is subject to
the tax on unrelated business income imposed by Code Section 511. For these
purposes, an "ERISA Prohibited Holder" means an employee benefit plan the
investment of which is regulated under Section 406 of the Employee Retirement
Income Security Act of 1974, as amended, and/or Code Section 4975 or a
governmental plan, as defined in Section 3(32) of ERISA, subject to any federal,
state or local law which is, to a material extent, similar to the foregoing
provisions of ERISA or the Code (collectively, a "Plan") or a Person investing
the assets of a Plan.
4. That the Investor historically has paid its debts as they have come
due and intends to pay its debts as they come due in the future and the Investor
intends to pay taxes associated with holding the Residual Certificate as they
become due.
5. That the Investor understands that it may incur tax liabilities with
respect to the Class [R][LR] Certificate in excess of cash flows generated by
the Class [R][LR] Certificate.
6. That the Investor will not transfer the Class [R][LR] Certificate to
any person or entity as to which the Investor has actual knowledge that the
requirements set forth in paragraph 3, paragraph 4 or paragraph 7 hereof are not
satisfied or that the Investor has reason to know does not satisfy the
requirements set forth in paragraph 4 hereof.
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7. That the investor (i) is not a Non-U.S. Person or (ii) is a Non-U.S.
Person that holds the Class [R][LR] Certificate in connection with the conduct
of a trade or business within the United States and has furnished the transferor
and the Trustee with an effective Internal Revenue Service Form 4224 or (iii) is
a Non-U.S. Person that has delivered to both the transferor and the Trustee an
opinion of a nationally recognized tax counsel to the effect that the transfer
of the Class [R][LR] Certificate to it is in accordance with the requirements of
the Code and the regulations promulgated thereunder and that such transfer of
the Class [R][LR] Certificate will not be disregarded for federal income tax
purposes. "Non-U.S. Person" shall mean an individual, corporation, partnership
or other person other than a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or under the
laws of the United States or any political subdivision thereof, an estate that
is subject to U.S. federal income tax regardless of the source of its income or
a trust if (A) for taxable years beginning after December 31, 1996 (or for
taxable years ending August 20, 1996, if the trustee has made an applicable
election), a court within the United States is able to exercise primary
supervision over the administration of such trust, and one or more United States
fiduciaries have the authority to control all substantial decisions of such
trust, or (B) for all other taxable years, such trust is subject to United
States federal income tax regardless of the source of its income.
8. That the Investor agrees to such amendments of the Pooling and
Servicing Agreement dated as of December 1, 1996 between Citicorp Mortgage
Securities, Inc. and The Bank of New York (the "Pooling and Servicing
Agreement") as may be required to further effectuate the restrictions on
transfer of the Citicorp Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series 1996-1 Class [R][LR] Certificate to such a "disqualified
organization," an agent thereof, an "ERISA Prohibited Holder" or a person that
does not satisfy the requirements of paragraphs 4, 5 and 7 hereof.
9. That the Investor consents to the irrevocable designation of CMSI as
its agent to act as "tax matters person" of the [Upper-Tier] [Lower-Tier] REMIC
pursuant to the Pooling and Servicing Agreement, and if such designation is not
permitted by the Code and applicable law, to act as tax matters person if
requested to do so.
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
[________] this ____ day of 19__.
------------------
By:_______________
Name:
Title:
COUNTY OF )
)
STATE OF )
Personally appeared before me the above-named [___________], known or
proved to me to be the same person who executed the foregoing instrument and to
be the [___________] fact of the Investor, and acknowledged to me that he
executed the same as his free act and deed and the free act and deed of the
Investors.
Subscribed and sworn to before me this ___ day of ________ 19___.
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