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EXHIBIT 4.1
EXECUTION COPY
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CITICORP RESIDENTIAL MORTGAGE SECURITIES, INC.,
Depositor
CITIMORTGAGE, INC.,
Servicer and Certificate Administrator
U.S. BANK NATIONAL ASSOCIATION,
Trustee
And
CITIBANK, N.A.,
Paying Agent, Certificate Registrar and Authenticating Agent
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POOLING AND SERVICING AGREEMENT
Dated as of November 1, 2006
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REMIC PASS-THROUGH CERTIFICATES,
SERIES 2006-3
<PAGE>
ARTICLES I-XI INCORPORATION BY REFERENCE
ARTICLE XII TERMS FOR SERIES 2006-3 CERTIFICATES
Section 12.01. General Terms for
Certificates.........................
Section 12.02. Additional Terms and
Definitions.......................
Section 12.03. Wire Transfer
Eligibility..............................
Section 12.04. REMIC-Related
Provisions...............................
Section 12.05. Expenses and Liabilities of the Trust
Fund.............
Section 12.06. Tax Matters
Person.....................................
Section 12.07.
[Reserved].............................................
ARTICLE XIII SUBORDINATION; PRIORITIES; ALLOCATION OF LOSSES
Section 13.01. Subordination; Priority of
Distributions...............
Section 13.02. Allocation of Realized Losses;
Recoveries..............
Section 13.03.
[Reserved].............................................
Section 13.04. Distributions on the Class R
Certificate...............
ARTICLE XIV ADDITIONAL PROVISIONS
Section 14.01. Additional Representations and
Warranties..............
Section 14.02. Additional Servicing Events of
Default.................
Section 14.03. Additional Conditions for Subsequent
Transfer Dates.........................................
Section 14.04. Additional Certificate
Information.....................
Section 14.05. Additional Pool
Information............................
SCHEDULES
SCHEDULE 1 Servicing Criteria to be Addressed in Report on
Assessment of
Compliance
SCHEDULE 2 Additional Form 10-D Disclosure
SCHEDULE 3 Additional Form 10-K Disclosure
SCHEDULE 4 Form 8-K Disclosure Information
EXHIBITS
EXHIBIT A-1 Form of Class A Certificates
EXHIBIT A-2 Form of Class M Certificates
EXHIBIT A-3 Form of Class CE Certificates
EXHIBIT A-4 Form of Class R Certificate
EXHIBIT B Schedule of Mortgage Loans
EXHIBIT C Form of Purchaser Letter
EXHIBIT D Form of ERISA Letter
EXHIBIT E Form of Servicer Certification
EXHIBIT F Form of Mortgage Document Custodial Agreement
<PAGE>
THIS POOLING AND SERVICING AGREEMENT ("this Pooling Agreement" or
"this
Agreement"), dated as of November 1, 2006, among CITICORP
RESIDENTIAL MORTGAGE
SECURITIES, INC., a Delaware corporation, as depositor ("CRMSI" or
the
"Depositor"), CITIMORTGAGE, INC., a New York corporation, as
servicer (the
"Servicer") and certificate administrator (the "Certificate
Administrator"),
U.S. BANK NATIONAL ASSOCIATION, a national banking association, as
trustee (the
"Trustee"), and CITIBANK, N.A., a national banking association, as
paying agent
(the "Paying Agent"), certificate registrar (the "Certificate
Registrar") and
authenticating agent (the "Authenticating Agent").
WITNESSETH THAT:
In the regular course of their business, certain affiliates of
CRMSI
originate and acquire Mortgage Loans. CRMSI, the Servicer and the
Trustee wish
to set forth the terms and conditions pursuant to which CRMSI will
sell to the
Trust Fund the Mortgage Loans listed on Exhibit B hereto.
Certificates will be
issued to Holders evidencing ownership interests in such Trust Fund
and the
Servicer will manage and service such Mortgage Loans. In
consideration of the
mutual agreements herein contained, CRMSI, the Servicer and the
Trustee agree as
follows:
ARTICLES I-XI
INCORPORATION BY REFERENCE
Those certain Standard Terms for Pooling and Servicing Agreements
dated as
of November 1, 2006 (the "Standard Terms"), a copy of which is
attached hereto,
as amended, superseded and supplemented hereby, are incorporated by
reference
herein as if set forth in full. Such Standard Terms, as so amended,
superseded
and supplemented, are hereby affirmed by, and shall constitute a
part of this
Agreement between, the parties hereto. For purposes of this Pooling
Agreement
and the Certificates executed and delivered hereunder, the terms
"this
Agreement," "herein," "hereof" and words of similar import shall
refer to this
Pooling Agreement including the Standard Terms as incorporated
herein with such
modifications or amendments for the related series of Certificates
as may be set
forth in this Pooling Agreement.
ARTICLE XII.
TERMS FOR SERIES 2006-3 CERTIFICATES
On November 29, 2006, there shall be established pursuant to the
terms of,
and authenticated under, this Pooling Agreement a series of
certificates known
and designated as "Citicorp Residential Mortgage Securities, Inc.
REMIC
Pass-Through Certificates, Series 2006-3". Elections will be made
pursuant to
this Agreement to treat the Trust as two REMICs for federal income
tax purposes.
The Certificates shall consist of (i) one Class consisting of seven
Subclasses
of Certificates (each a "Class A Subclass") designated as "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3, Senior
Class A-1a Certificates" (the "Class A-1a Certificates"), "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3, Senior
Class A-1b Certificates" (the "Class A-1b Certificates"), "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3, Senior
Class A-2 Certificates" (the "Class A-2 Certificates"), "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3, Senior
Class A-3 Certificates" (the "Class A-3 Certificates"), "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3, Senior
Class A-4 Certificates" (the "Class A-4 Certificates"), "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3, Senior
Class A-5 Certificates" (the "Class A-5 Certificates"), and
"Citicorp
Residential Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series
2006-3, Senior Class A-6 Certificates" (the "Class A-6
Certificates" and,
collectively, together with the Class A-1a, Class A-1b, Class A-2,
Class A-3,
Class A-4 and Class A-5 Certificates, the "Class A Certificates");
(ii) one
Class consisting of nine Subclasses (each a "Class M Subclass") of
Certificates
designated as "Citicorp Residential Mortgage Securities, Inc.,
REMIC
Pass-Through Certificates, Series 2006-3, Subordinated Class M-1
Certificates"
(the "Class M-1 Certificates"), "Citicorp Residential Mortgage
Securities, Inc.
REMIC Pass-Through Certificates, Series 2006-3, Subordinated Class
M-2
Certificates" (the "Class M-2 Certificates"), "Citicorp Residential
Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 2006-3,
Subordinated
Class M-3 Certificates" (the "Class M-3 Certificates"), "Citicorp
Residential
Mortgage Securities, Inc. REMIC Pass-Through Certificates, Series
2006-3,
Subordinated Class M-4 Certificates" (the "Class M-4
Certificates"), "Citicorp
Residential Mortgage Securities, Inc. REMIC Pass-Through
Certificates, Series
2006-3, Subordinated Class M-5 Certificates" (the "Class M-5
Certificates"),
"Citicorp Residential Mortgage Securities, Inc. REMIC Pass-Through
Certificates,
Series 2006-3, Subordinated Class M-6 Certificates" (the "Class
M-6
Certificates"), "Citicorp Residential Mortgage Securities, Inc.
REMIC
Pass-Through Certificates, Series 2006-3, Subordinated Class M-7
Certificates"
(the "Class M-7 Certificates"), "Citicorp Residential Mortgage
Securities, Inc.
REMIC Pass-Through Certificates, Series 2006-3, Subordinated Class
M-8
Certificates" (the "Class M-8 Certificates"), and "Citicorp
Residential Mortgage
Securities, Inc. REMIC Pass-Through Certificates, Series 2006-3,
Subordinated
Class M-9 Certificates" (the "Class M-9 Certificates", and together
with the
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6,
Class M-7 and
Class M-8 Certificates, collectively, the "Class M Certificates");
(iii) one
Class of Certificates designated as "Citicorp Residential Mortgage
Securities,
Inc. REMIC Pass-Through Certificates, Series 2006-3, Subordinated
Class CE
Certificates" (the "Class CE Certificates") and (iv) one class of
residual
interests designated as "Citicorp Residential Mortgage Securities,
Inc. REMIC
Pass-Through Certificates, Series 2006-3, Class R Certificate" (the
"Class R
Certificate" and, together with the Class A, Class M and Class CE
Certificates,
the "Certificates").
For the avoidance of doubt, all of the Certificates are of the same
Group
(as such term is defined in the Standard Terms) and all of the
Mortgage Loans
are in the same Pool (as such term is defined in the Standard
Terms).
The Class A-1a, Class A-1b, Class A-2, Class A-3, Class A-4, Class
A-5,
Class A-6, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6,
Class M-7, Class M-8 and Class M-9 Certificates (exclusive of their
respective
rights to receive Class A Subclass Cap Amounts or Class M Subclass
Cap Amounts,
as applicable) and the Class CE Certificates (exclusive of their
obligation to
pay Class A Subclass Cap Amounts or Class M Subclass Cap Amounts)
are hereby
designated as "regular interests" in the Upper-Tier REMIC within
the meaning of
Code Section 860G(a)(1). The Class R Certificate represents
ownership of the
Class LT-R Interest, which is the "residual interest" in the
Lower-Tier REMIC,
and the Class UT-R Interest, which is the "residual interest" in
the Upper-Tier
REMIC within the meaning of Code Section 860G(a)(2). The
Certificates shall have
the terms provided for in this Agreement.
<PAGE>
Section 12.01. General Terms for Certificates.
(a) The Class A Certificates, the Class M Certificates, Class
CE
Certificates and Class R Certificate shall have the following
respective Initial
Principal Balances and Certificate Rates:
Initial Principal Certificate
Balance Rate(1)
----------------- -----------
Class A-1a Certificates $96,853,000 5.815%
Class A-1b Certificates $96,853,000 (2)
Class A-2 Certificates $64,542,000 5.609%
Class A-3 Certificates $56,069,000 5.610%
Class A-4 Certificates $77,419,000 5.703%
Class A-5 Certificates $32,327,000 5.948%
Class A-6 Certificates $47,118,000 5.628%
Class M-1 Certificates $13,299,000 5.794%
Class M-2 Certificates $14,928,000 5.824%
Class M-3 Certificates $3,800,000 5.874%
Class M-4 Certificates $4,886,000 5.953%
Class M-5 Certificates $5,157,000 6.052%
Class M-6 Certificates $4,071,000 6.151%
Class M-7 Certificates $3,257,000 6.399%
Class M-8 Certificates $2,985,000 6.697%
Class M-9 Certificates $4,615,000 7.241%
Class CE Certificates (3) (4)
Class R Certificate (5) (5)
(1) For all Interest Accrual Periods commencing after the Optional
Termination
Date, the Certificate Rate for each Class of Certificates (other
than
Class A1-b, Class R and Class CE) will be the applicable rate set
forth
above plus 0.50% per annum.
(2) Interest will accrue on the Class A-1b Certificates during each
Interest
Accrual Period at a per annum rate equal to the sum of (x)
One-Month LIBOR
for such Interest Accrual Period plus (y) the Class A-1b Margin for
such
Interest Accrual Period. The "Class A-1b Margin" shall be 0.07% for
all
Interest Accrual Periods commencing on or prior to the Optional
Termination Date, and shall be 0.14% for all Interest Accrual
Periods
commencing after the Optional Termination Date. With respect to the
first
Interest Accrual Period, interest will accrue on the Class A-1b
Certificates at a per annum rate equal to 5.39000%.
(3) For federal income tax purposes, the Class CE Certificates will
be treated
as having a Principal Balance equal to the Overcollateralization
Amount.
(4) The Class CE Certificates have no Certificate Rate.
(5) The Class R Certificate has no Principal Balance or Certificate
Rate.
The Class CE Certificates and the Class R Certificate will be
entitled to
distributions as set forth herein.
The last scheduled distribution date is November 25, 2036 for each
Class,
and is the "latest possible maturity date" of the related Subclass
or Class for
purposes of Section 860G(a)(1) of the Code and Treasury Regulations
Section
1.860G-1(a)(4)(iii).
(b) For each Distribution Date, each of the Class A Certificates
and Class
M Certificates will accrue interest on their respective Principal
Balances
during the related Interest Accrual Period at the lesser of (x) the
applicable
Certificate Rate for such Subclass or Class set forth in Section
12.01(a) and
(y) the Net WAC Rate for such Distribution Date. Interest accrued
on the
Certificates during any Interest Accrual Period will be calculated
on the
assumption that any distributions in reduction of Principal Balance
on all
Certificates were made, and any allocations of any losses were
made, on the day
immediately following the last day of the preceding Interest
Accrual Period.
Each Class A Subclass Interest Amount and each Class M Subclass
Interest Amount
relating to an Interest Accrual Period shall be distributable on
the following
Distribution Date. Each Subclass and Class of Certificates shall
accrue interest
from the applicable Accrual Date for such Subclass and Class of
Certificates.
Interest on the Certificates (other than the Class A-1b, Class CE
or Class
R Certificates) will be calculated on the basis of a 360-day year
comprised on
twelve 30-day months. Interest on the Class A-1b Certificates will
be calculated
on the basis of the actual number of days in the related Interest
Accrual Period
and a 360-day year. On each Distribution Date, each Class A
Subclass Interest
Amount and each Class M Subclass Interest Amount for such Subclass
for such
Distribution Date shall be distributable to such Subclass or Class
of
Certificates.
(c) [Reserved].
(d) Subject to the provisions of Section 13.01, on each
Distribution Date
prior to the Subordination Depletion Date, the Senior Principal
Distribution
Amount will be allocated among and distributed in reduction of the
Principal
Balance of the Subclasses of the Class A Certificates sequentially
as follows:
(I) first, to the Class A-6 Certificates, the Class A-6
Priority
Amount for such Distribution Date; and
(II) then, the amount remaining after application according to
clause (I) above, sequentially as follows:
(1) to the Class A-1a and Class A-1b Certificates, pro rata,
based on their respective outstanding Principal
Balances, until their respective Principal Balances are
reduced to zero,
(2) to the Class A-2 Certificates until their Principal
Balance is reduced to zero,
(3) to the Class A-3 Certificates until their Principal
Balance is reduced to zero,
(4) to the Class A-4 Certificates until their Principal
Balance is reduced to zero,
(5) to the Class A-5 Certificates until their Principal
Balance is reduced to zero, and
(6) to the Class A-6 Certificates until their Principal
Balance is reduced to zero.
(e) On each Distribution Date on or after the Subordination
Depletion
Date, notwithstanding the priorities set forth in Section 12.01(d),
the Senior
Principal Distribution Amount will be distributed pro rata to the
Class A
Subclasses, based on outstanding Principal Balances.
(f) On each Distribution Date, distributions in reduction of the
Principal
Balance made to each Class A Subclass will be distributed pro rata
among the
holders of Certificates of such Class A Subclass.
(g) On each Distribution Date, subject to the provisions of Section
13.01,
distributions in reduction of Principal Balance of the Subclasses
of Class M
Certificates will be made in an aggregate amount equal to the
applicable Class M
Subclass Principal Distribution Amount, respectively, in accordance
with the
priorities set forth in Section 13.01(b).
(h) Other distributions shall be made in respect of the
Certificates as
provided in Section 13.01.
Section 12.02. Additional Terms and Definitions.The Certificates
shall
have and be subject to the following additional specific terms:
Accrual Date. For each Class or Subclass of interest-bearing
Certificates
other than the Class A-1b Certificates, the Cut-Off Date, and for
the Class A-1b
Certificates, the Closing Date.
Authenticating Agent. Citibank, N.A., Agency and Trust, 388
Greenwich
Street, 14th Floor, New York, New York 10013, Attention: CRMSI
2006-3 has been
appointed by the Trustee as an Authenticating Agent pursuant to
Section 8.12.
Any such Authenticating Agent may be removed, and any other
Authenticating Agent
appointed, as permitted by Section 8.12 and shall have the rights,
privileges,
benefits, exculpatory provisions and protections of the Trustee as
set forth in
Sections 8.01, 8.02, 8.03 and 8.04.
Book-Entry Certificates. All Subclasses of Class A Certificates and
all
Subclasses of Class M Certificates are Book-Entry Certificates.
Cap Amounts. Any Class A Subclass Cap Amount or Class M Subclass
Cap
Amount.
Capitalized Interest Account. Not applicable.
Cash Deposited into Collection Account. No cash will be deposited
into the
Collection Account on the Issue Date.
Certificate Administrator. CitiMortgage, Inc. shall act as the
initial
Certificate Administrator, which appointment is hereby approved by
the Trustee.
The Certificate Administrator is authorized to take actions
permitted or
required thereof under this Agreement. The Certificate
Administrator may be
removed, and any other Certificate Administrator reasonably
acceptable to the
Trustee appointed, by the Servicer.
Certificate Rate. The Certificate Rates for the Certificates are as
set
forth in Section 12.01(a).
Certificate Registrar. Citibank, N.A., having its principal
offices
located at 111 Wall Street, 15th Floor, New York, New York 10005,
Attention:
15th Floor Window, is hereby appointed as the Certificate Registrar
for all of
the Certificates pursuant to Section 5.02 and shall have the
rights, privileges,
benefits, exculpatory provisions and protections of the Trustee as
set forth in
Sections 8.01, 8.02, 8.03, 8.04, 8.07, and 8.09.
Class A Principal Balance. As of any date, the sum of the Class A
Subclass
Principal Balances of the Class A Certificates.
Class A Subclass Cap Amount. For a Distribution Date and any Class
A
Subclass, the sum of (x) the difference (if greater than zero)
between the
Normal Accrual for such Class A Subclass for the related Interest
Accrual Period
and the WAC Accrual for such Class A Subclass for the related
Interest Accrual
Period and (y) any Class A Subclass Cap Amount remaining unpaid on
the prior
Distribution Date after giving effect to all payments made on such
prior
Distribution Date, plus interest on the amount thereof at its
Certificate Rate
for the related Interest Accrual Period for the Distribution Date
in question.
Class A Subclass Interest Shortfall. For a Distribution Date and
any Class
A Subclass, the sum of (x) any Class A Subclass Interest Shortfall
Amount for
such Subclass for such Distribution Date and (y) any Class A
Subclass Interest
Shortfall for such Subclass for the prior Distribution Date and
remaining unpaid
after application of all payments on such prior Distribution Date
plus interest
on the amount thereof at the lower of (x) the applicable
Certificate Rate for
the Interest Accrual Period related to the Distribution Date in
question and (y)
the Net WAC Rate for the Distribution Date in question.
Class A Subclass Principal Distribution Amount. For each
Distribution Date
and any Class A Subclass, the amount of principal distributed to
such Class A
Subclass pursuant to clause 1.d of Section 13.01(b).
Class A-1b Margin: As defined in Section 12.01(b).
Class A-6 Percentage. The Principal Balance of the Class A-6
Certificates,
divided by the aggregate Subclass Principal Balances of the Class
A
Certificates.
Class A-6 Priority Amount. For any Distribution Date means the
lesser of
(A) the Principal Balance of the Class A-6 Certificates and (B) the
product of
(a) the Class A-6 Percentage, (b) the Class A-6 Shift Percentage
and (c) the
Senior Principal Distribution Amount.
Class A-6 Shift Percentage. For any Distribution Date will be
the
percentage indicated below:
Class A-6
Distribution Date Occurring In Shift Percentage
------------------------------ ----------------
December 2006 through November 2009............. 0%
December 2009 through November 2011............. 45%
December 2011 through November 2012............. 80%
December 2012 through November 2013............. 100%
December 2013 and thereafter.................... 300%
Class CE Distributable Amount. On any Distribution Date, the sum of
(i) as
a distribution in respect of interest, the amount of interest that
has accrued
on the Class CE Interest and not applied as an Extra Principal
Distribution
Amount on such Distribution Amount on such Distribution Date, plus
any such
accrued interest remaining undistributed from prior Distribution
Dates, plus
(without duplication) (ii) as a distribution in respect of
principal, any
portion of the Principal Balance of the Class CE Interest which is
distributable
as a Release Amount, minus (iii) any amounts paid in respect of the
Class A
Subclass Cap Amounts or the Class M Subclass Cap Amounts.
Class LT-Accrual Interest. One of the separate non-certificated
beneficial
ownership interests in the Lower-Tier REMIC issued hereunder and
designated as a
regular interest in the Lower-Tier REMIC. Class LT-Accrual Interest
shall accrue
interest at the related Interest Rate in effect from time to time,
and shall be
entitled to distributions of principal, subject to the terms and
conditions
hereof, in an aggregate amount equal to 1/2 of the Pool Balance
plus 1/2 of the
Overcollateralization Amount, as set forth in Section 12.04(a).
Class LT-R Interest. The residual interest in the Lower-Tier REMIC
as
described in Section 12.04(a) and the related footnote thereto.
Class M Factor. For Class M-1, 78.50%; for Class M-2, 84.00%; for
Class
M-3, 85.40%; for Class M-4, 87.20%; for Class M-5, 89.10%; for
Class M-6,
90.60%; for Class M-7, 91.80%; for Class M-8, 92.90% and for Class
M-9, 94.60%.
Class M Subclass Cap Amount. For a Distribution Date and any Class
M
Subclass, the sum of (x) the difference (if greater than zero)
between the
Normal Accrual for such Class M Subclass for the related Interest
Accrual Period
and the WAC Accrual for such Class M Subclass for the related
Interest Accrual
Period and (y) any Class M Subclass Cap Amount remaining unpaid on
the prior
Distribution Date after giving effect to all payments made on such
prior
Distribution Date, plus interest on the amount thereof at the
applicable
Certificate Rate for the related Interest Accrual Period for the
Distribution
Date in question.
Class M Subclass Interest Shortfall. For a Distribution Date and
any Class
M Subclass, the sum of (x) any Class M Subclass Interest Shortfall
Amount for
such Subclass for such Distribution Date and (y) any Class M
Subclass Interest
Shortfall for such Subclass for the prior Distribution Date and
remaining unpaid
after application of all payments on such prior Distribution Date
plus interest
on the amount thereof at the lower of (x) the applicable
Certificate Rate for
the Interest Accrual Period related to the Distribution Date in
question and (y)
the Net WAC Rate for the Distribution Date in question.
Class M Subclass Principal Distribution Amount. For any
Distribution Date
on or after the Stepdown Date and on which a Trigger Event is not
in effect, an
amount for a particular Class M Subclass equal to the excess of
(a) the sum of (x) the Class A Principal Balance and the Class M
Subclass
Principal Balance for each Class M Subclass having a lower
numerical designation
(after giving effect to the payment on such Distribution Date of
the Senior
Principal Distribution Amount and each Class M Subclass Principal
Distribution
Amount for a Class M Subclass having a lower numerical designation)
and (y) the
Class M Subclass Principal Balance of the Class M Subclass in
question
immediately prior to such Distribution Date over
(b) the lesser of (x) the Class M Factor for such Class M Subclass
times
the Pool Balance as of the end of the related Collection Period and
(y) the Pool
Balance as of the end of the related Collection Period minus the OC
Floor
Amount.
For any other Distribution Date, (a) if the Class A Principal
Balance has not
been reduced to zero and either (x) such Distribution Date is prior
to the
Stepdown Date or (y) a Trigger Event is in effect, each Class M
Subclass
Principal Distribution Amount shall be zero and (b) if the Class A
Principal
Balance has been reduced to zero and either (x) such Distribution
Date is prior
to the Stepdown Date or (y) a Trigger Event is in effect, the Class
M Subclass
Principal Distribution Amount for a particular Class M Subclass
shall be equal
to the lesser of (1) 100% of the Principal Distribution Amount
minus the sum of
the Class M Subclass Principal Distribution Amounts for each Class
M Subclass
with a lower numerical designation and (2) the Class M Subclass
Principal
Balance of such Class M Subclass.
Class UT-R Interest. The residual interest in the Upper-Tier REMIC
as
described in Section 12.04(a) and the related footnote thereto.
Closing Date. November 29, 2006.
Constituent REMIC. The Upper-Tier REMIC and the Lower-Tier REMIC
shall be
the "Constituent REMICs" for purposes of Section 3.11.
Corporate Trust Office. The Corporate Trust Office is located at
U.S. Bank
National Association, having its principal offices located at One
Federal
Street--3rd Floor, Boston, Massachusetts 02110, Attention:
Corporate Trust
Services, Citicorp Residential Mortgage Securities, Inc. REMIC
Pass-Through
Certificates, Series 2006-3, or such other address as shall be
identified to
CRMSI and all Certificateholders by or on behalf of the Trustee in
writing.
Cumulative Loss Test. The Cumulative Loss Test will be failed on
a
Distribution Date if the Cumulative Loss Percentage equals or
exceeds (1) with
respect to Distribution Dates from December 2008 through November
2009,
inclusive, 0.75%, (2) with respect to Distribution Dates from
December 2009
through November 2010, inclusive, 1.75%, (3) with respect to
Distribution Dates
from December 2010 through November 2011, inclusive, 2.95%, (4)
with respect to
Distribution Dates from December 2011 through November 2012,
inclusive, 3.95%
and (5) with respect to Distribution Dates from December 2012 and
thereafter,
4.70%.
Current Class A Enhancement Level. As of any Distribution Date,
the
percentage obtained by dividing (i) the sum of the Class M Subclass
Principal
Balances of the Class M Certificates and the Overcollateralization
Amount (prior
to giving effect to any distributions in reduction of Principal
Balance and the
allocation of any losses on such date) by (ii) the Pool Balance as
of the last
day of the related Collection Period.
Current Interest. For a Distribution Date, the sum of the Class A
Subclass
Interest Amounts and Class M Subclass Interest Amounts.
Current Pool Balance. For any date, the Pool Balance.
Custodian. Citibank, N.A. is designated by the Trustee as the
Custodian.
Cut-Off Date. The Cut-Off Date is the beginning of business on
November 1,
2006.
Daily Servicing Fee Accrual Amount. For each Mortgage Loan during
each day
during each Collection Period, an amount equal to (a) the product
of (i) the
Servicing Fee Rate and (ii) the Loan Balance of such Mortgage Loan
as of such
day, divided by (b) 360.
Definitive Certificates. The Class CE Certificates and the Class
R
Certificate will be issued in fully registered certificated
form.
Delinquency Test. The Delinquency Test will be failed on a
Distribution
Date if the Rolling Sixty-Day Delinquency Rate for such
Distribution Date is
greater than 50% of the Current Class A Enhancement Level as of
such
Distribution Date.
Denominations. The denominations of each Subclass of the Class
A
Certificates and Class M Certificates are $100,000 Initial
Principal Balance and
integral multiples of $1 in excess thereof (except that one
Certificate of each
Class or Subclass may be issued in a different denomination). The
denominations
of the Class CE Certificates and Class R Certificate are 100%
Percentage
Interest.
Depository. The initial Depository is Citibank, N.A.
Determination Date. The Determination Date for each Distribution
Date is
the close of business on the 18th day (or, if such day is not a
Business Day,
the preceding Business Day) of the month in which the related
Distribution Date
occurs.
Distribution Date. Each Distribution Date shall be the 25th day of
each
month (or if such day is not a Business Day, the next succeeding
Business Day),
commencing in December 2006.
Enhancement Date: The first Distribution Date on which the Current
Class A
Enhancement Level is greater than or equal to the Required Class A
Enhancement
Level.
ERISA Restricted Certificates. The Class CE Certificates and Class
R
Certificate.
Extra Principal Distribution Amount. For any Distribution Date, the
lesser
of (x) Monthly Excess Interest and (y) the Deficiency Amount.
Initial Pool Balance. $542,836,307.48.
Initial Principal Balance. The Initial Principal Balance for each
Subclass
of the Class A Certificates and for each Subclass of the Class M
Certificates
and for the Class R Certificate is as set forth in Section
12.01(a).
Interest Accrual Period. The Interest Accrual Period for any
given
Distribution Date is (x) for all Certificates other than the Class
A-1b, Class
CE or Class R Certificates, the period from and including the first
day of the
month preceding the month of such given Distribution Date to and
including the
last day of the month preceding the month of such Distribution
Date, and (y) for
the Class A-1(b) Certificates, the period from and including the
immediately
preceding Distribution Date (or, in the case of the first
Distribution Date, the
Closing Date) to and including the day before such given
Distribution Date.
Investment Account. None of the Collection Account or the
Certificate
Account will be an Investment Account.
Issue Date. The Issue Date is November 29, 2006.
Last Scheduled Distribution Date. The Last Scheduled Distribution
Date for
each Class of Certificates is as set forth in Section 12.01(a).
LIBOR Determination Date. The date that is two London Business
Days
preceding the relevant Interest Accrual Period for the Class A-1b
Certificates.
London Business Day. A day on which dealings in deposits in U.S.
dollars
are transacted in the London interbank market.
Lower-Tier REMIC. The designated portion of the Trust Fund
consisting of
the Mortgage Loans, proceeds thereof, any related REO Property and
all other
property of the Trust Fund other than the assets of the Upper-Tier
REMIC and the
right of the Class A Certificates and the Class M Certificates to
receive, and
the obligation of the Class CE Certificates to pay, Cap
Amounts.
Lower-Tier REMIC Principal Amount. On the Closing Date, with
respect to
each Lower-Tier REMIC Regular Interest, the amount set forth in the
chart under
the heading "Lower-Tier REMIC" in Section 12.04, and on any
subsequent date, as
reduced by distributions of principal and Realized Losses and as
increased by
Subsequent Recoveries, as set forth in Section 12.04.
Lower-Tier REMIC Regular Interest. As defined in Section 12.04.
LT Accretion Directed Classes. As defined in Section 12.04(a).
Net Civil Relief Amount. For a Distribution Date and any Class A
Subclass
and Class M Subclass, the sum of (x) any Civil Relief Shortfall
Amount for such
Subclass for such Distribution Date and (y) the aggregate of all
Civil Relief
Shortfall Amounts for such Subclass for all prior Distribution
Dates, minus the
aggregate amount of payments made in respect thereof on all prior
Distribution
Dates pursuant to Section 13.01(b)(1)(f).
Net Class A WAC Cap Amount. For a Distribution Date and any Class
A
Subclass, the sum of (x) any Class A Subclass Cap Amount for such
Subclass for
such Distribution Date and (y) the aggregate of all Class A
Subclass Cap Amounts
for such Subclass for all prior Distribution Dates, minus the
aggregate amount
of payments made in respect thereof on all prior Distribution Dates
pursuant to
Section 13.01(b)(1)(g), plus interest on the amount thereof at the
applicable
Certificate Rate for the Interest Accrual Period related to the
Distribution
Date in question; provided that, on any Distribution Date after the
Principal
Balance of a Class A Subclass has been reduced to zero, the Net
Class A WAC Cap
Amount for such Class A Subclass shall be zero.
Net Class M WAC Cap Amount. For a Distribution Date and any Class
M
Subclass, the sum of (x) any Class M Subclass Cap Amount for such
Subclass for
such Distribution Date and (y) the aggregate of all Class M
Subclass Cap Amounts
for such Subclass for all prior Distribution Dates, minus the
aggregate amount
of payments made in respect thereof on all prior Distribution Dates
pursuant to
Section 13.01(b)(1)(g), plus interest on the amount thereof at the
applicable
Certificate Rate for the Interest Accrual Period related to the
Distribution
Date in question; provided that, on any Distribution Date after the
Principal
Balance of a Class M Subclass has been reduced to zero, the Net
Class M WAC Cap
Amount for such Class M Subclass shall be zero.
Net Non-Supported Amount. For a Distribution Date and any Class A
Subclass
and Class M Subclass, the sum of (x) any Unsupported Prepayment
Interest
Shortfall for such Subclass for such Distribution Date and (y) the
aggregate of
all Unsupported Prepayment Interest Shortfalls for such Subclass
for all prior
Distribution Dates, minus the aggregate amount of payments made in
respect
thereof on all prior Distribution Dates pursuant to Section
13.01(b)(1)(f).
Net WAC Rate. For a Distribution Date, a per annum rate equal to
the
weighted average of the Pass-Through Rates of the Mortgage Loans as
of the
beginning of business on the first day of the Collection Period
related to such
Distribution Date (weighted on the basis of the respective Loan
Balances of the
Mortgage Loans as of the beginning of business on such day).
Normal Accrual. For any Interest Accrual Period and for each
Subclass, the
amount of interest accrued thereon at the applicable Certificate
Rate, minus any
Civil Relief Shortfall Amount and any Unsupported Prepayment
Interest Shortfall
allocated to such Subclass on the related Distribution Date.
Notices. The address of the Trustee to which notices should be sent
is the
Corporate Trust Office. The address of CRMSI to which notices
should be sent is
Citicorp Residential Mortgage Securities, Inc., 1000 Technology
Drive, O'Fallon,
Missouri 63368-2240, Attention: Office of General Counsel. The
address of the
Servicer to which notices should be sent is CitiMortgage, Inc.,
1000 Technology
Drive, O'Fallon, Missouri 63368-2240, Attention: Office of General
Counsel. The
address of S&P to which notices should be sent is 55 Water
Street, New York, NY
10004. The address of Moody's to which notices should be sent is
Structured
Finance Group, 99 Church Street, New York, New York 10007. The
address of the
Paying Agent and Authenticating Agent is Citibank, N.A., 388
Greenwich Street,
14th Floor, New York, NY 10013, Attention: Agency and Trust, CRMSI
2006-3 or any
other address that the Paying Agent and Authenticating Agent may
designate from
time to time by notice to the Certificateholders. The address of
the Certificate
Registrar for certificate transfer purposes and for purposes of
presentation and
surrender of certificates for the final distribution thereon is
Citibank, N.A.,
Agency and Trust, 111 Wall Street, 14th floor, New York, New York
10005,
Attention: 15th Floor window or any other address that the
Certificate Registrar
may designate from time to time for the Certificateholders.
OC Floor Amount. For any date, 0.50% of the Initial Pool
Balance.
One-Month LIBOR. On any LIBOR Determination Date, One-Month LIBOR
will be
equal to the offered rate for deposits in U.S. dollars having an
index maturity
of one month for the next interest period, as such rate appears on
Telerate Page
3750, Bloomberg Page BBAM, or another page of these or any other
financial
reporting service in general use in the financial services industry
at
approximately 11:00 a.m., London time, on such LIBOR Determination
Date, rounded
upward, if necessary, to the nearest multiple of 1/16 of 1%. If
Telerate Page
3750 or Bloomberg Page BBAM is replaced by another service or
ceases to exist,
the Certificate Administrator will use the replacing service or
such other
service that may be nominated by the British Bankers Association
for the purpose
of displaying London interbank offered rates for U.S. dollar
deposits.
If no offered rate appears on Telerate Page 3750 or Bloomberg Page
BBAM on
a LIBOR Determination Date at approximately 11:00 a.m., London
time, then the
Certificate Administrator will select four major banks in the
London interbank
market and shall request each of their principal London offices to
provide a
quotation of the rate at which one-month deposits in U.S. dollars
in amounts of
at least $1,000,000 are offered by it to prime banks in the London
interbank
market, on that date and at that time, that is representative of
single
transactions at that time. If at least two quotations are provided,
One-Month
LIBOR will be the arithmetic average of the quotations provided.
Otherwise, the
Certificate Administrator will select three major banks in New York
City and
shall request each of them to provide a quotation of the rate
offered by them at
approximately 11:00 a.m., New York City time, on the LIBOR
Determination Date
for loans in U.S. dollars to leading European banks having an index
maturity of
one month for the applicable Interest Accrual Period in an amount
of at least
$1,000,000 that is representative of single transactions at that
time. If three
quotations are provided, One-Month LIBOR will be the arithmetic
average of the
quotations provided. Otherwise, the rate of One-Month LIBOR for the
next
interest period will be set equal to the rate of One-Month LIBOR
for the current
Interest Accrual Period.
Optional Termination Date. The first Distribution Date on which the
Right
to Purchase may be exercised.
Overcollateralization Amount. For a Distribution Date, any excess
of (x)
the Pool Balance as of the last day of the related Collection
Period over (y)
the sum of the Class A Principal Balance and the Class M Principal
Balance
(after giving effect to (i) distributions of Principal Proceeds on
such
Distribution Date and (ii) and the increase of any Class M Subclass
Principal
Balance as a result of Subsequent Recoveries, but prior to the
payment of any
Extra Principal Distribution Amount).
Paying Agent. Citibank, N.A. shall act as the initial Paying Agent,
which
appointment is hereby approved by the Trustee. The Paying Agent
shall take
actions permitted or required of the Trustee under Sections 3.06,
4.01, 4.02 and
4.03 and any other actions for the Paying Agent specifically set
forth in the
Pooling Agreement and, in taking such actions, the Paying Agent
(and not the
Trustee) shall have all of the rights, privilege, benefits,
exculpatory
provisions and protections of the Trustee as set forth in Sections
8.01, 8.02,
8.03, 8.04, 8.07, and 8.09. The Servicer may at any time appoint an
additional
Paying Agent reasonably acceptable to the Trustee for any
particular Class or
all Classes of the Certificates. Any such Paying Agent may be
removed, and any
other Paying Agent reasonably acceptable to the Trustee appointed,
by the
Servicer. For purposes of Section 4.07, the website of the Paying
Agent is
located at www.sf.citidirect.com.
Principal Distribution Amount. For any Distribution Date, the
lesser of
(x) the Certificate Balance and (y) Principal Proceeds plus any
Extra Principal
Distribution Amount minus any Release Amount.
Private Certificates. The Class CE Certificates and the Class R
Certificate.
Prospectus. The prospectus dated November 28, 2006 relating to the
Class A
Certificates and the Class M Certificates.
Rating Agencies. The Rating Agencies are S&P and Moody's.
Record Date. The Record Date for each Distribution Date will be (x)
for
all Certificates other than the Class A-1b Certificates, the close
of business
on the last day of the month preceding the month of the applicable
Distribution
Date, and (y) for the Class A-1b Certificates, the day immediately
preceding
such Distribution Date.
Release Amount. For a Distribution Date on or after the Stepdown
Date, the
lesser of (x) Principal Proceeds and (y) the excess of the
Overcollateralization
Amount over the greater of (a) the Targeted Level and (b) the OC
Floor Amount;
provided that if on such Distribution Date a Trigger Event is in
effect, the
Release Amount is zero.
Required Class A Enhancement Level. For any date, 26.40%.
Right to Purchase. The right of the Servicer to purchase all of
the
Mortgage Loans pursuant to Section 9.01 shall be conditioned upon,
among other
things, the Current Pool Balance being less than 10% of the Initial
Pool Balance
at the time of any such repurchase.
Rolling Sixty-Day Delinquency Rate. For any Distribution Date on or
after
the Stepdown Date, the average of the Sixty-Day Delinquency Rates
for such
Distribution Date and the two immediately preceding Distribution
Dates.
Section 3.19 Applicability. Section 3.19 is not applicable to the
Series
2006-3 Certificates.
Senior Principal Distribution Amount. For any Distribution Date
prior to
the Stepdown Date or on which a Trigger Event is in effect, the
Principal
Distribution Amount for such Distribution Date; for all other
Distribution
Dates, the lesser of (x) the Principal Distribution Amount and (y)
the Class A
Principal Balance minus the lesser of (A) the Pool Balance minus
the OC Floor
Amount and (B) 73.60% of the Pool Balance.
Servicing Fee. The Servicing Fee is a monthly fee equal, for
each
Collection Period, to the sum of Daily Servicing Fee Accrual
Amounts for each
Mortgage Loan for each day during such Collection Period, payable
to the
Servicer out of each payment received by it on account of interest
on such
Mortgage Loan during such Collection Period.
Servicing Fee Rate. 0.50% per annum.
Sixty-Day Delinquency Rate. For any Distribution Date, the
percentage
equivalent of a fraction, the numerator of which equals the
aggregate Loan
Balances Delinquent more than 60 days (without regard to any grace
period and
including, for this purpose, Mortgage Loans in foreclosure or
subject to
Mortgagor bankruptcy proceedings and REO Properties) as of the last
day of the
related Collection Period, and the denominator of which equals the
Pool Balance
as of the last day of that Collection Period.
Startup Day. The Startup Day will be the Issue Date.
Stepdown Date. The earlier to occur of (a) the first Distribution
Date on
or prior to which the Class A Principal Balance has been reduced to
zero and (b)
the later to occur of (x) the Distribution Date in December 2009
and (y) the
Enhancement Date.
Subordinated Certificates. The Class M Certificates.
Subordination Depletion Date. The first Distribution Date on which
the
Principal Balance of the Subordinated Certificates has been reduced
to zero.
Targeted Level. On any Distribution Date, (a) prior to the Stepdown
Date,
2.70% of the Initial Pool Balance and (b) on any other Distribution
Date, the
greater of (i) 5.40% of the Pool Balance and (ii) the OC Floor
Amount. However,
in the event that a Trigger Event is in effect on a particular
Distribution
Date, the Targeted Level for such Distribution Date shall not be
less than the
Targeted Level on the preceding Distribution Date.
Trigger Event. A Trigger Event will be in effect on a Distribution
Date if
either the Delinquency Test or the Cumulative Loss Test is
failed.
Trust. The Trust created by this Agreement, which shall be named
the
Citicorp Residential Mortgage Trust Series 2006-3.
Upper-Tier REMIC. The designated portion of the Trust Fund
consisting of
the Lower-Tier REMIC Regular Interests and proceeds thereof.
Upper-Tier REMIC Regular Interests. As defined in Section
12.04.
Voting Interest. As of any date, the Voting Interest of the Class
A
Certificates shall equal 100% multiplied by a fraction the
numerator of which is
the Class A Principal Balance and the denominator of which is the
sum of the
Class A Principal Balance and the Class M Principal Balance. As of
any date the
Voting Interest of the Class M Certificates will equal 100% minus
the Class A
Voting Interest. The Voting Interest of the Class A Certificates
and the Class M
Certificates will be allocated among the Subclasses of the Class A
or Class M
Certificates, as the case may be, pro rata based on each such
Subclass'
Principal Balance.
WAC Accrual. For any Interest Accrual Period and for each Subclass,
the
amount of interest accrued thereon at the Net WAC Rate.
Section 12.03. Wire Transfer Eligibility.
The minimum Initial Principal Balance for wire transfer on each
Distribution Date, in the case of Certificates (other than the
Class CE and
Class R Certificates), is $1,000,000 and, in the case of each of
the Class CE
Certificates and Class R Certificate, a 100% Percentage
Interest.
Section 12.04. REMIC-Related Provisions.
(a) CRMSI and the Trustee will perform their respective duties in a
manner
consistent with the REMIC provisions of the Code and will not
knowingly take or
fail to take any action that would adversely affect the continuing
treatment of
the Trust Fund as a segregated asset pool, and the treatment of
such segregated
asset pool as two REMICs and to avoid the imposition of a tax on
the Trust Fund
or either REMIC, and to carry out the covenants set forth in this
Article XII
and the elections and reporting required in Section 8.11 on behalf
of the
Upper-Tier REMIC and the Lower-Tier REMIC, including making the
appropriate
elections to treat each such segregated asset pool as a REMIC and
maintaining a
segregated account (the "Certificate Account"). The rights to the
Cap Amounts
shall be accounted for as notional principal contracts (provided by
the holder
of the Class CE Certificates and funded from amounts that would
otherwise be
distributable thereon) and as assets of a grantor trust for federal
income tax
purposes, and not as assets of either REMIC. CRMSI shall furnish or
cause to be
furnished annually to the holders of the related Certificates
information
regarding their allocable share of the income with respect to such
grantor trust
and shall file or cause to be filed with the Internal Revenue
Service Form 1041
(together with any necessary attachments) or such other applicable
form.
Lower-Tier REMIC
The Lower-Tier REMIC shall issue the interests designated in the
table
below and the Class LT-R Interest, and each such interest, other
than the Class
LT-R Interest, is hereby designated as a regular interest in the
Lower-Tier
REMIC ("Lower-Tier REMIC Regular Interest"). The Class LT-R
Interest is hereby
designated as the sole class of residual interest in the Lower-Tier
REMIC and
shall be represented by the Class R Certificate.
Corresponding
Corresponding Lower-Tier Upper-Tier
Lower-Tier REMIC REMIC Lower-Tier REMIC REMIC Regular
Regular Interest Interest Rate Principal Amount Interest
---------------- ------------- ------------------------
-------------
Class LT-A-1a (1) 1/2 initial Certificate A-1a
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-A-1b (1) 1/2 initial Certificate A-1b
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-A-2 (1) 1/2 initial Certificate A-2
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-A-3 (1) 1/2 initial Certificate A-3
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-A-4 (1) 1/2 initial Certificate A-4
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-A-5 (1) 1/2 initial Certificate A-5
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-A-6 (1) 1/2 initial Certificate A-6
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-1 (1) 1/2 initial Certificate M-1
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-2 (1) 1/2 initial Certificate M-2
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-3 (1) 1/2 initial Certificate M-3
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-4 (1) 1/2 initial Certificate M-4
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-5 (1) 1/2 initial Certificate M-5
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-6 (1) 1/2 initial Certificate M-6
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-7 (1) 1/2 initial Certificate M-7
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-8 (1) 1/2 initial Certificate M-8
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-M-9 (1) 1/2 initial Certificate M-9
Balance of Corresponding
Upper-Tier REMIC Regular
Interest
Class LT-Accrual (1) 1/2 Pool Balance plus 1/ N/A
Overcollateralization
Amount
-------------------------
(1) The interest rate with respect to any Distribution Date for
these
interests is a per annum variable rate equal to the Net WAC
Rate.
Each Lower-Tier REMIC Regular Interest is hereby designated as a
regular
interest in the Lower-Tier REMIC. The Class LT-A-1a, Class LT-A-1b,
Class
LT-A-2, Class LT-A-3, Class LT-A-4, Class LT-A-5, Class LT-A-6,
Class LT-M-1,
Class LT-M-2, Class LT-M-3, Class LT-M-4, Class LT-M-5, Class
LT-M-6, Class
LT-M-7, Class LT-M-8 and Class LT-M-9 Interests are hereby
designated the LT
Accretion Directed Classes (the "LT Accretion Directed
Classes").
On each Distribution Date, 50% of the increase in the
Overcollateralization Amount shall be payable as a reduction of the
Lower-Tier
REMIC Principal Amount of the LT Accretion Directed Classes (each
such Class
will be reduced by an amount equal to 50% of any increase in
the
Overcollateralization Amount that is attributable to a reduction in
the
Certificate Balance of its Corresponding Class) and shall be
accrued and added
to the Lower-Tier REMIC Principal Amount of the Class LT-Accrual
Interest. On
each Distribution Date, the increase in the Lower-Tier REMIC
Principal Amount of
the Class LT-Accrual Interest shall not exceed interest accruals
for such
Distribution Date for the Class LT-Accrual Interest. In the event
that: (i) 50%
of the increase in the Overcollateralization Amount exceeds (ii)
interest
accruals on the Class LT-Accrual Interest for such Distribution
Date, the excess
for such Distribution Date (accumulated with all such excesses for
all prior
Distribution Dates) will be added to any increase in the
Overcollateralization
Amount for purposes of determining the amount of interest accrual
on the Class
LT-Accrual Interest payable as principal on the LT Accretion
Directed Classes on
the next Distribution Date pursuant to the first sentence of this
paragraph. All
payments of scheduled principal and prepayments of principal
generated by the
Mortgage Loans and all Subsequent Recoveries allocable to principal
shall be
allocated (i) 50% to the Class LT-Accrual Interest and (ii) 50% to
the LT
Accretion Directed Classes (such principal payments and Subsequent
Recoveries
shall be allocated among such LT Accretion Directed Classes in an
amount equal
to 50% of the principal amounts and Subsequent Recoveries allocated
to their
respective Corresponding Classes), until paid in full.
Notwithstanding the
above, principal payments allocated to the Class CE Interest that
result in the
reduction in the Overcollateralization Amount shall be allocated to
the Class
LT-Accrual Interest (until paid in full). Realized Losses shall be
applied so
that after all distributions have been made on each Distribution
Date (i) the
Lower-Tier REMIC Principal Amount of each of the LT Accretion
Directed Classes
is equal to 50% of the Certificate Balance of their Corresponding
Class, and
(ii) the Class LT-Accrual Interest is equal to 50% of the aggregate
Stated
Principal Balance of the Mortgage Loans plus 50% of the
Overcollateralization
Amount. Any increase in the Certificate Balance of a Class of
Certificates as a
result of a Subsequent Recovery shall increase the Lower-Tier REMIC
Principal
Amount of the Corresponding Lower-Tier REMIC Regular Interest by
50% of such
increase, and the remaining 50% of such increase shall increase the
Lower-Tier
REMIC Principal Amount of the Class LT-Accrual Interest.
Upper-Tier REMIC
The Upper-Tier REMIC shall issue the interests designated in the
table
below and the Class UT-R Interest, and each such interest, other
than the Class
UT-R Interest, is hereby designated as a regular interest in the
Upper-Tier
REMIC ("Upper-Tier REMIC Regular Interest"). The Class UT-R
Interest is hereby
designated as the sole class of residual interests in the
Upper-Tier REMIC and
shall be represented by the Class R Certificate.
Initial Upper-Tier Corresponding
Upper-Tier REMIC Upper-Tier REMIC REMIC Principal Class of
Regular Interest Interest Rate Amount Certificates
---------------- ---------------- ------------------
-------------
Class A-1a (1) $96,853,000 Class A-1a
Class A-1b (1) $96,853,000 Class A-1b
Class A-2 (1) $64,542,000 Class A-2
Class A-3 (1) $56,069,000 Class A-3
Class A-4 (1) $77,419,000 Class A-4
Class A-5 (1) $32,327,000 Class A-5
Class A-6 (1) $47,118,000 Class A-6
Class M-1 (1) $13,299,000 Class M-1
Class M-2 (1) $14,928,000 Class M-2
Class M-3 (1) $3,800,000 Class M-3
Class M-4 (1) $4,886,000 Class M-4
Class M-5 (1) $5,157,000 Class M-5
Class M-6 (1) $4,071,000 Class M-6
Class M-7 (1) $3,257,000 Class M-7
Class M-8 (1) $2,985,000 Class M-8
Class M-9 (1) $4,615,000 Class M-9
Class CE (2) (2) N/A
------------------------
(1) For any Distribution Date (and the related Interest Accrual
Period), this
interest shall bear interest at the lesser of (i) the Certificate
Rate
(determined without regard to the Net WAC Rate) for the
Corresponding
Class of Certificates and (ii) the Net WAC Rate.
(2) The Class CE Interest has an initial principal balance of
$14,657,307.48
but will not accrue interest on such balance but will accrue
interest on a
notional principal balance. As of any Distribution Date, the Class
CE
Interest shall have a notional principal balance equal to the
aggregate of
the Lower-Tier REMIC Principal Amounts of the Lower-Tier REMIC
Regular
Interests as of the first day of the related Interest Accrual
Period. With
respect to any Interest Accrual Period, the Class CE Interest shall
bear
interest at a rate equal to the excess, if any, of the Net WAC Rate
over
the product of (i) 2 and (ii) the weighted average of the
Lower-Tier REMIC
Interest Rates of the Lower-Tier REMIC Regular Interests, where
the
Lower-Tier REMIC Interest Rate on the Class LT-Accrual Interest is
subject
to a cap equal to zero and each LT Accretion Directed Class is
subject to
a cap equal to the Upper-Tier REMIC Interest Rate on its
Corresponding
Class of Upper-Tier REMIC Regular Interest. With respect to any
Distribution Date, interest that so accrues on the notional
principal
balance of the Class CE Interest shall be deferred in an amount
equal to
any increase in the Overcollateralization Amount on such
Distribution
Date. Such deferred interest shall not itself bear interest.
On each Distribution Date, interest distributable in respect of
the
Lower-Tier REMIC Regular Interests for such Distribution Date shall
be deemed to
be distributed on the interests in the Upper-Tier REMIC at the
rates shown
above.
On each Distribution Date, all Realized Losses, Subsequent
Recoveries and
all payments of principal shall be allocated to the Upper-Tier
REMIC Regular
Interests until the outstanding principal balance of each such
interest equals
the outstanding Class A Subclass Principal Balance or Class M
Subclass Principal
Balance of the Corresponding Class of Certificates as of such
Distribution Date.
(b) CRMSI, on behalf of the Trustee, shall deposit in the
Collection
Account in accordance with Section 3.06 all Scheduled Payments
received by it,
all other deposits required to be made to the Collection Account
and all
investments made with moneys on deposit in the Collection Account,
including all
income or gain from such investments, if any. If the Certificate
Account is an
Investment Account, then funds on deposit in the Certificate
Account shall be
held and invested in accordance with the applicable provisions of
Section 4.03.
Distributions from the Certificate Account shall be made in
accordance with the
provisions of Articles XII and XIII to make payments in respect of
the
Certificates and to pay the Servicing Fee in accordance with
Section 3.13.
Amounts distributable as Cap Amounts to the related Certificates
pursuant to
Section 13.01(b) shall first be deemed distributed in respect of
the Class CE
Interest and then paid outside of the Upper-Tier REMIC to the
related
Certificates.
The Servicer shall maintain books with respect to the Upper-Tier
REMIC and
the Lower-Tier REMIC on a calendar year taxable year and on the
accrual method
of accounting.
(c) None of the Servicer, the Certificate Administrator, the Paying
Agent,
the Certificate Registrar or the Trustee shall create, or permit
the creation
of, any "interests" in either REMIC within the meaning of Code
Section
860D(a)(2) other than the interests represented by the
Certificates.
(d) Except as otherwise provided in the Code, CRMSI shall not
grant, and
none of the Servicer, the Certificate Administrator, the Paying
Agent, the
Certificate Registrar or the Trustee shall accept, property unless
(i)
substantially all of the property held by either REMIC constitutes
either
"qualified mortgages" or "permitted investments" as defined in Code
Sections
860G(a)(3) and (5), respectively, and (ii) no property shall be
granted to
either REMIC after the Startup Day, unless such grant would not
subject the
REMIC to the 100% tax on contributions to a REMIC after the Startup
Day imposed
by Code Section 860G(d).
(e) None of the Servicer, the Certificate Administrator, the Paying
Agent,
the Certificate Registrar or the Trustee shall accept on behalf of
the Trust
Fund or the Upper-Tier REMIC or the Lower-Tier REMIC any fee or
other
compensation for services and shall not accept on behalf of the
Trust Fund any
income from assets other than those permitted to be held by a
REMIC.
(f) None of the Servicer, the Certificate Administrator, the Paying
Agent
or the Trustee shall sell or permit the sale of all or any portion
of the
Mortgage Loans, or of an Eligible Investment held in an Investment
Account
(other than in accordance with Sections 2.02, 2.03, 2.04 and
4.03(d)) unless
such sale is pursuant to a "qualified liquidation" as defined in
Code Section
860F(a)(4)(A) and is in accordance with Section 9.01.
Section 12.05. Expenses and Liabilities of the Trust Fund.
To the extent not otherwise payable pursuant to another provision
of this
Agreement, the Depositor shall be liable for all expenses,
liabilities and
obligations of the Trust Fund (other than the obligation to make
distributions
in reduction of Principal Balance of the Certificates and the
obligation to make
distributions of interest on the Certificates). To the extent such
expenses,
liabilities or obligations consist of federal income taxes,
including, without
limitation, prohibited transaction taxes, taxes on net income from
foreclosure
property and taxes on certain contributions to a REMIC after the
Startup Day,
nothing shall prevent the Depositor from contesting any such tax,
if permitted
by law, pending the outcome of such proceedings. If the Paying
Agent determines
that on any Distribution Date the amount in the Collection Account,
after the
distribution of all amounts required to be distributed to the
Holders of the
Certificates has been made, is insufficient to pay expenses or meet
any
obligations of the Trust Fund that are not otherwise payable
pursuant to another
provision of this Agreement, the Paying Agent shall give notice of
any shortfall
to the Depositor setting forth the basis for such determination
and, within ten
Business Days of such notice, the Depositor shall deliver to the
Paying Agent
immediately available funds in the amount of such expenses.
Section 12.06. Tax Matters Person.
If in any taxable year there will be more than one holder of Class
R
Certificate, a tax matters person may be designated with respect to
the REMIC,
who will have the same duties with respect to the Upper-Tier REMIC
and the
Lower-Tier REMIC as those of a "t
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