EXHIBIT 4.1
<PAGE>
CITIGROUP MORTGAGE LOAN TRUST INC.
Depositor
OPTION ONE MORTGAGE CORPORATION
Servicer
and
DEUTSCHE BANK NATIONAL TRUST COMPANY
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of February 1, 2005
Citigroup Mortgage Loan Trust, Series 2005-OPT1
Asset Backed Pass-Through Certificates
Series 2005-OPT1
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
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SECTION 1.01. Defined
Terms.....................................................................1
SECTION 1.02. Allocation of Certain Interest
Shortfalls........................................44
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of the Mortgage
Loans.................................................46
SECTION 2.02. Acceptance of REMIC I by
Trustee.................................................49
SECTION 2.03. Repurchase or Substitution of
Mortgage Loans by the Originator
or the
Seller....................................................................50
SECTION 2.04.
Reserved.........................................................................53
SECTION 2.05. Representations, Warranties and
Covenants of the Servicer........................53
SECTION 2.06. Issuance of the REMIC I Regular
Interests and the Class R-I Interest.............55
SECTION 2.07.
[Reserved].......................................................................55
SECTION 2.08. Conveyance of REMIC Regular
Interests and Acceptance of REMIC I, REMIC
II, REMIC III and REMIC IV by the Trustee; Issuance of
Certificates..............55
ARTICLE III
ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS
SECTION 3.01. Servicer to Act as
Servicer......................................................58
SECTION 3.02. Sub-Servicing Agreements Between
Servicer and Sub-Servicers......................60
SECTION 3.03. Successor
Sub-Servicers..........................................................61
SECTION 3.04. Liability of the
Servicer........................................................61
SECTION 3.05. No Contractual Relationship
Between Sub-Servicers, the Trustee or
Certificateholders...............................................................62
SECTION 3.06. Assumption or Termination of
Sub-Servicing Agreements by Trustee.................62
SECTION 3.07. Collection of Certain Mortgage
Loan Payments.....................................62
SECTION 3.08. Sub-Servicing
Accounts...........................................................63
SECTION 3.09. Collection of Taxes, Assessments
and Similar Items; Servicing Accounts...........63
SECTION 3.10. Collection Account and
Distribution Account......................................64
SECTION 3.11. Withdrawals from the Collection
Account and Distribution Account.................67
SECTION 3.12. Investment of Funds in the
Collection Account and the Distribution
Account..........................................................................69
SECTION 3.13.
[Reserved].......................................................................70
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SECTION 3.14. Maintenance of Hazard Insurance
and Errors and Omissions and Fidelity
Coverage.........................................................................70
SECTION 3.15. Enforcement of Due-On-Sale
Clauses; Assumption Agreements........................72
SECTION 3.16. Realization Upon Defaulted
Mortgage Loans........................................73
SECTION 3.17. Trustee to Cooperate; Release of
Mortgage Files..................................75
SECTION 3.18. Servicing
Compensation...........................................................76
SECTION 3.19. Reports to the Trustee; Collection
Account Statements............................76
SECTION 3.20. Statement as to
Compliance.......................................................77
SECTION 3.21. Independent Public Accountants'
Servicing Report.................................77
SECTION 3.22. Access to Certain
Documentation..................................................77
SECTION 3.23. Title, Management and Disposition
of REO Property................................78
SECTION 3.24. Obligations of the Servicer in
Respect of Prepayment Interest Shortfalls.........81
SECTION 3.25.
[Reserved].......................................................................81
SECTION 3.26. Obligations of the Servicer in
Respect of Mortgage Rates and Monthly
Payments.........................................................................81
SECTION 3.27.
Solicitations....................................................................82
SECTION 3.28. Net WAC Rate Carryover Reserve
Account...........................................82
SECTION 3.29. Advance
Facility.................................................................83
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01.
Distributions....................................................................85
SECTION 4.02. Statements to
Certificateholders.................................................91
SECTION 4.03. Remittance Reports;
Advances.....................................................94
SECTION 4.04. Allocation of Realized
Losses....................................................95
SECTION 4.05. Compliance with Withholding
Requirements.........................................97
SECTION 4.06. Exchange Commission; Additional
Information......................................98
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The
Certificates................................................................100
SECTION 5.02. Registration of Transfer and
Exchange of Certificates...........................102
SECTION 5.03. Mutilated, Destroyed, Lost or
Stolen Certificates...............................107
SECTION 5.04. Persons Deemed
Owners...........................................................107
SECTION 5.05. Certain Available
Information...................................................108
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
SECTION 6.01. Liability of the Depositor and the
Servicer.....................................109
SECTION 6.02. Merger or Consolidation of the
Depositor or the Servicer........................109
SECTION 6.03. Limitation on Liability of the
Depositor, the Servicer and Others...............109
SECTION 6.04. Limitation on Resignation of the
Servicer.......................................110
SECTION 6.05. Rights of the Depositor in Respect
of the Servicer..............................111
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ARTICLE VII
DEFAULT
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SECTION 7.01. Servicer Events of
Default......................................................113
SECTION 7.02. Trustee to Act; Appointment of
Successor........................................115
SECTION 7.03. Notification to
Certificateholders..............................................116
SECTION 7.04. Waiver of Servicer Events of
Default............................................116
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of
Trustee...............................................................117
SECTION 8.02. Certain Matters Affecting the
Trustee...........................................118
SECTION 8.03. Trustee Not Liable for
Certificates or Mortgage Loans...........................119
SECTION 8.04. Trustee May Own
Certificates....................................................119
SECTION 8.05. Trustee's Fees and
Expenses.....................................................120
SECTION 8.06. Eligibility Requirements for
Trustee............................................121
SECTION 8.07. Resignation and Removal of the
Trustee..........................................121
SECTION 8.08. Successor
Trustee...............................................................122
SECTION 8.09. Merger or Consolidation of
Trustee..............................................122
SECTION 8.10. Appointment of Co-Trustee or
Separate Trustee...................................122
SECTION 8.11. Appointment of the
Custodian....................................................124
SECTION 8.12. Appointment of Office or
Agency.................................................124
SECTION 8.13. Representations and Warranties of
the Trustee...................................124
ARTICLE IX
TERMINATION
SECTION 9.01. Termination Upon Repurchase or
Liquidation of All Mortgage Loans................126
SECTION 9.02. Additional Termination
Requirements.............................................128
ARTICLE X
REMIC PROVISIONS
SECTION 10.01. REMIC
Administration............................................................129
SECTION 10.02. Prohibited Transactions and
Activities..........................................131
SECTION 10.03. Servicer and Trustee
Indemnification............................................132
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01.
Amendment.......................................................................133
SECTION 11.02. Recordation of Agreement;
Counterparts..........................................134
SECTION 11.03. Limitation on Rights of
Certificateholders......................................134
SECTION 11.04. Governing
Law...................................................................135
SECTION 11.05.
Notices.........................................................................135
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SECTION 11.06. Severability of
Provisions......................................................136
SECTION 11.07. Notice to Rating
Agencies.......................................................136
SECTION 11.08. Article and Section
References..................................................137
SECTION 11.09. Grant of Security
Interest......................................................137
ARTICLE XII
RIGHTS OF THE CLASS CE CERTIFICATEHOLDER
SECTION 12.01. Reports and
Notices.............................................................138
SECTION 12.02. Class CE Certificateholder's
Directions With Respect to Defaulted
Mortgage
Loans..................................................................139
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iv
<PAGE>
Exhibits
--------
Exhibit A-1 Form of Class A-1A
Certificate
Exhibit A-2 Form of Class A-1B
Certificate
Exhibit A-3 Form of Class A-1C
Certificate
Exhibit A-4 Form of Class M-1
Certificate
Exhibit A-5 Form of Class M-2
Certificate
Exhibit A-6 Form of Class M-3
Certificate
Exhibit A-7 Form of Class M-4
Certificate
Exhibit A-8 Form of Class M-5
Certificate
Exhibit A-9 Form of Class M-6
Certificate
Exhibit A-10 Form of Class M-7
Certificate
Exhibit A-11 Form of Class M-8
Certificate
Exhibit A-12 Form of Class M-9
Certificate
Exhibit A-13 Form of Class M-10
Certificate
Exhibit A-14 Form of Class CE
Certificate
Exhibit A-15 Form of Class P
Certificate
Exhibit A-16 Form of Class R
Certificate
Exhibit A-17 Form of Class R-X
Certificate
Exhibit B Form of
Custodial Agreement
Exhibit C-1 Form of Trustee's
Initial Certification
Exhibit C-2 Form of Trustee's
Final Certification
Exhibit C-3 [Reserved]
Exhibit D Form of
Mortgage Loan Purchase Agreement
Exhibit E Request
for Release
Exhibit F-1 Form of Transferor
Representation Letter and Form of
Transferee Representation Letter in Connection with Transfer
of the Private Certificates Pursuant to Rule 144A Under the
1933 Act
Exhibit F-2 Form of Transfer
Affidavit and Agreement and Form of
Transferor Affidavit in Connection with Transfer of Residual
Certificates
Exhibit G Form of
Certification with respect to ERISA and the Code
Exhibit H Form of
Lost Note Affidavit
Exhibit I-1 Form of Certification
to Be Provided by the Depositor with Form
10-K
Exhibit I-2 Form of Certification
to Be Provided to Depositor by the Trustee
Exhibit I-3 Form of Certification
to Be Provided to Depositor by the Servicer
Exhibit J Form of
Annual Statement as to Compliance
Exhibit K Form of
Cap Contracts
Exhibit L Form of
Report Pursuant to Section 12.01
Schedule 1 Mortgage Loan
Schedule
Schedule 2 Prepayment
Charge Schedule
v
<PAGE>
This Pooling and Servicing Agreement, is dated and effective
as of February 1, 2005, among CITIGROUP
MORTGAGE LOAN TRUST INC. as Depositor,
OPTION ONE MORTGAGE CORPORATION as Servicer
and DEUTSCHE BANK NATIONAL TRUST
COMPANY as Trustee.
PRELIMINARY STATEMENT:
The Depositor intends to sell pass-through certificates to be
issued hereunder in multiple classes, which
in the aggregate will evidence the
entire beneficial ownership interest in
each REMIC (as defined herein) created
hereunder. The Trust Fund will consist of a
segregated pool of assets comprised
of the Mortgage Loans and certain other
related assets subject to this
Agreement.
REMIC I
-------
As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the
Mortgage Loans and certain other
related assets (other than any Servicer
Prepayment Charge Payment Amounts, the
Net WAC Rate Carryover Reserve Account and
the Cap Contracts) subject to this
Agreement as a REMIC for federal income tax
purposes, and such segregated pool
of assets will be designated as "REMIC I."
The Class R-I Interest will be the
sole class of "residual interests" in REMIC
I for purposes of the REMIC
Provisions (as defined herein). The
following table irrevocably sets forth the
designation, the REMIC I Remittance Rate,
the initial Uncertificated Balance
and, for purposes of satisfying Treasury
regulation Section 1.860G-1(a)(4)(iii),
the "latest possible maturity date" for
each of the REMIC I Regular Interests
(as defined herein). None of the REMIC I
Regular Interests will be certificated.
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REMIC I
Initial
Latest Possible
Designation
Remittance Rate
Uncertificated Balance
Maturity Date(1)
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I-LTAA
Variable(2)
$ 797,626,221.27
January 25, 2035
I-LTA1A
Variable(2)
$
2,901,500.00
January 25, 2035
I-LTA1B
Variable(2)
$
3,142,860.00
January 25, 2035
I-LTA1C
Variable(2)
$ 462,796.00
January 25, 2035
I-LTM1
Variable(2)
$ 297,076.00
January 25, 2035
I-LTM2
Variable(2)
$ 240,103.00
January 25, 2035
I-LTM3
Variable(2)
$ 154,643.00
January 25, 2035
I-LTM4
Variable(2)
$ 134,295.00
January 25, 2035
I-LTM5
Variable(2)
$ 130,226.00
January 25, 2035
I-LTM6
Variable(2)
$ 118,017.00
January 25, 2035
I-LTM7
Variable(2)
$
101,739.00
January 25, 2035
I-LTM8
Variable(2)
$
65,113.00
January 25, 2035
I-LTM9
Variable(2)
$
81,391.00
January 25, 2035
I-LTM10
Variable(2)
$ 89,530.00
January 25, 2035
I-LTZZ
Variable(2)
$
8,358,797.15
January 25, 2035
I-LTP
Variable(2)
$
100.00
January 25, 2035
</TABLE>
_______________
(1) For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution
Date immediately following the maturity date for the
Mortgage Loan
with the latest maturity date has been designated as the
"latest possible
maturity date" for each REMIC I Regular Interest.
(2) Calculated in accordance with the
definition of "REMIC I Remittance Rate"
herein.
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REMIC II
--------
As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the
REMIC I Regular Interests as a REMIC
for federal income tax purposes, and such
segregated pool of assets will be
designated as "REMIC II." The Class R-II
Interest will evidence the sole class
of "residual interests" in REMIC II for
purposes of the REMIC Provisions under
federal income tax law. The following table
irrevocably sets forth the
designation, the Pass-Through Rate, the
initial aggregate Certificate Principal
Balance and, for purposes of satisfying
Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible
maturity date" for the indicated
Classes of Certificates.
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Initial Aggregate
Certificate Principal
Latest Possible
Designation
Pass-Through Rate
Balance
Maturity Date(1)
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Class A-1A
Variable(2)
$ 290,150,000.00
January 25, 2035
Class A-1B
Variable(2)
$ 314,286,000.00
January 25, 2035
Class A-1C
Variable(2)
$ 46,279,600.00
January 25, 2035
Class M-1
Variable(2)
$ 29,707,600.00
January 25, 2035
Class M-2
Variable(2)
$ 24,010,300.00
January 25, 2035
Class M-3
Variable(2)
$ 15,464,300.00
January 25, 2035
Class M-4
Variable(2)
$ 13,429,500.00
January 25, 2035
Class M-5
Variable(2)
$ 13,022,600.00
January 25, 2035
Class M-6
Variable(2)
$ 11,801,700.00
January 25, 2035
Class M-7
Variable(2)
$ 10,173,900.00
January 25, 2035
Class M-8
Variable(2)
$
6,511,300.00
January 25, 2035
Class M-9
Variable(2)
$
8,139,100.00
January 25, 2035
Class M-10
Variable(2)
$
8,953,000.00
January 25, 2035
Class CE Interest
Variable(3)
$ 21,975,407.42
January 25, 2035
Class P Interest
N/A(4)
$
100.00
January 25, 2035
</TABLE>
_______________
(1) For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution
Date immediately following the maturity date for the
Mortgage Loans
with the latest maturity date has been designated as the
"latest possible maturity
date" for each Class of Certificates.
(2) Calculated in accordance with the
definition of "Pass-Through Rate" herein.
(3) The Class CE Interest will accrue
interest at its variable Pass-Through
Rate on the
Notional Amount of the Class CE Interest outstanding from time
to time which
shall equal the aggregate Uncertificated Balance of the REMIC
I Regular
Interests (other than REMIC I Regular Interest I-LTP). The
Class
CE Interest will
not accrue interest on its Certificate Principal Balance.
(4) The Class P Interest will not
accrue interest.
vii
<PAGE>
REMIC III
---------
As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the
Class CE Interest as a REMIC for
federal income tax purposes, and such
segregated pool of assets will be
designated as "REMIC III." The Class R-III
Interest will evidence the sole class
of "residual interests" in REMIC III for
purposes of the REMIC Provisions under
federal income tax law. The following table
irrevocably sets forth the
designation, the Pass-Through Rate, the
initial aggregate Certificate Principal
Balance and, for purposes of satisfying
Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible
maturity date" for the indicated
Classes of Certificates.
<TABLE>
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Initial Aggregate
Certificate Principal
Latest Possible
Designation
Pass-Through Rate
Balance
Maturity Date(1)
-----------
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----------------
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<C>
Class CE Certificates
Variable(2)
$21,975,407.42
January 25, 2035
</TABLE>
_______________
(1) For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution
Date immediately following the maturity date for the
Mortgage Loans
with the latest maturity date has been designated as the
"latest possible
maturity date" for the Class CE Certificates.
(2) The Class CE Certificates will
receive 100% of amounts received in respect
of the Class CE
Interest.
<PAGE>
REMIC IV
--------
As provided herein, the Trustee will elect to treat the
segregated pool of assets consisting of the
Class P Interest as a REMIC for
federal income tax purposes, and such
segregated pool of assets will be
designated as "REMIC IV." The Class R-IV
Interest will evidence the sole class
of "residual interests" in REMIC IV for
purposes of the REMIC Provisions under
federal income tax law. The following table
irrevocably sets forth the
designation, the Pass-Through Rate, the
initial aggregate Certificate Principal
Balance and, for purposes of satisfying
Treasury regulation Section
1.860G-1(a)(4)(iii), the "latest possible
maturity date" for the indicated
Classes of Certificates.
<TABLE>
<CAPTION>
Initial Aggregate
Certificate Principal
Latest Possible
Designation
Pass-Through Rate
Balance
Maturity Date(1)
-----------
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-------
----------------
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Class P Certificates
Variable(2)
$100.00
January 25, 2035
</TABLE>
_______________
(1) For purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations,
the Distribution
Date immediately following the maturity date for the
Mortgage Loans
with the latest maturity date has been designated as the
"latest possible
maturity date" for the Class P Certificates.
(2) The Class P Certificates will
receive 100% of amounts received in respect
of the Class P
Interest.
As of the Cut-off Date, the Mortgage Loans had an aggregate
Stated Principal Balance equal to
$813,904,407.42.
In consideration of the mutual agreements herein contained,
the Depositor, the Servicer and the Trustee
agree as follows:
ix
<PAGE>
ARTICLE
I
DEFINITIONS
SECTION 1.01. Defined
Terms.
Whenever used in this Agreement, including, without
limitation, in the Preliminary Statement
hereto, the following words and
phrases, unless the context otherwise
requires, shall have the meanings
specified in this Article. Unless otherwise
specified, all calculations
described herein shall be made on the basis
of a 360-day year consisting of
twelve 30-day months.
"Accepted Servicing Practices": The servicing standards set
forth in Section 3.01.
"Accrued Certificate Interest": With respect to any Class A
Certificate, Mezzanine Certificate and the
Class CE Certificates and each
Distribution Date, interest accrued during
the related Interest Accrual Period
at the Pass-Through Rate for such
Certificate for such Distribution Date on the
Certificate Principal Balance, in the case
of the Class A Certificates and the
Mezzanine Certificates, or on the Notional
Amount, in the case of the Class CE
Certificates, of such Certificate
immediately prior to such Distribution Date.
The Class P Certificates is not entitled to
distributions in respect of interest
and, accordingly, will not accrue interest.
All distributions of interest on the
Class A Certificates and the Mezzanine
Certificates will be calculated on the
basis of a 360-day year and the actual
number of days in the applicable Interest
Accrual Period. All distributions of
interest on the Class CE Certificates will
be based on a 360-day year consisting of
twelve 30-day months. Accrued
Certificate Interest with respect to each
Distribution Date, as to any Class A
Certificate, Mezzanine Certificate or the
Class CE Certificates, shall be
reduced by an amount equal to the portion
allocable to such Certificate pursuant
to Section 1.02 hereof of the sum of (a)
the aggregate Prepayment Interest
Shortfall, if any, for such Distribution
Date to the extent not covered by
payments pursuant to Section 3.24 and (b)
the aggregate amount of any Relief Act
Interest Shortfall, if any, for such
Distribution Date. In addition, Accrued
Certificate Interest with respect to each
Distribution Date, as to the Class CE
Certificates shall be reduced by an amount
equal to the portion allocable to the
Class CE Certificates of Realized Losses,
if any, pursuant to Section 4.04
hereof.
"Adjustable-Rate Mortgage Loan": Each of the Mortgage Loans
identified on the Mortgage Loan Schedule as
having a Mortgage Rate that is
subject to adjustment.
"Adjustment Date": With respect to each Adjustable-Rate
Mortgage Loan, the first day of the month
in which the Mortgage Rate of such
Mortgage Loan changes pursuant to the
related Mortgage Note. The first
Adjustment Date following the Cut-off Date
as to each Adjustable-Rate Mortgage
Loan is set forth in the Mortgage Loan
Schedule.
"Advance": As to any Mortgage Loan or REO Property, any
advance made by the Servicer in respect of
any Distribution Date pursuant to
Section 4.03.
"Advance Facility": As defined in Section 3.29 hereof.
1
<PAGE>
"Advancing Person": As defined in Section 3.29(a) hereof.
"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.
"Agreement": This Pooling and Servicing Agreement and all
amendments hereof and supplements
hereto.
"Allocated Realized Loss Amount": With respect to any
Distribution Date and any Class of
Mezzanine Certificates, the sum of (i) any
Realized Losses allocated to such Class of
Certificates on such Distribution
Date and (ii) the amount of any Allocated
Realized Loss Amount for such Class of
Certificates remaining unpaid from the
previous Distribution Date minus the
amount of the increase in the related
Certificate Principal Balance due to the
receipt of Subsequent Recoveries as
provided in Section 4.01.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form
(excepting therefrom, if applicable,
the mortgage recordation information which
has not been required pursuant to
Section 2.01 hereof or returned by the
applicable recorder's office), which is
sufficient under the laws of the
jurisdiction wherein the related Mortgaged
Property is located to reflect of record
the sale of the Mortgage, which
assignment, notice of transfer or
equivalent instrument may be in the form of
one or more blanket assignments covering
Mortgages secured by Mortgaged
Properties located in the same county, if
permitted by law.
"Available Distribution Amount": With respect to any
Distribution Date, an amount equal to (1)
the sum of (a) the aggregate of the
amounts on deposit in the Collection
Account and Distribution Account as of the
close of business on the related
Determination Date, (b) the aggregate of any
amounts received in respect of an REO
Property withdrawn from any REO Account
and deposited in the Distribution Account
for such Distribution Date pursuant to
Section 3.23, (c) the aggregate of any
amounts deposited in the Distribution
Account by the Servicer in respect of
Prepayment Interest Shortfalls for such
Distribution Date pursuant to Section 3.24,
(d) the aggregate of any Advances
made by the Servicer for such Distribution
Date pursuant to Section 4.03, (e)
the aggregate of any advances made by the
Trustee as successor Servicer or any
other successor Servicer for such
Distribution Date pursuant to Section 7.02,
reduced (to not less than zero), by (2) the
portion of the amount described in
clause (1)(a) above that represents (i)
Monthly Payments on the Mortgage Loans
received from a Mortgagor on or prior to
the Determination Date but due during
any Due Period subsequent to the related
Due Period, (ii) Principal Prepayments
on the Mortgage Loans received after the
related Prepayment Period (together
with any interest payments received with
such Principal Prepayments to the
extent they represent the payment of
interest accrued on the Mortgage Loans
during a period subsequent to the related
Prepayment Period) (other than
Prepayment Charges), (iii) Liquidation
Proceeds and Insurance Proceeds received
in respect of the Mortgage Loans after the
related
2
<PAGE>
Prepayment Period, (iv) amounts
reimbursable or payable to the Depositor, the
Servicer, the Trustee, the Seller or any
Sub-Servicer pursuant to Section 3.11,
Section 3.12, Section 8.05 or otherwise
payable in respect of Extraordinary
Trust Fund Expenses, (v) the Trustee Fee
and the expenses of the Custodian
payable from the Distribution Account
pursuant to Section 8.05, (vi) amounts
deposited in the Collection Account or the
Distribution Account in error and
(vii) the amount of any Prepayment Charges
collected by the Servicer in
connection with the Principal Prepayment of
any of the Mortgage Loans or any
Servicer Prepayment Charge Payment
Amount.
"Balloon Mortgage Loan": A Mortgage Loan that provides for the
payment of the unamortized principal
balance of such Mortgage Loan in a single
payment at the maturity of such Mortgage
Loan that is substantially greater than
the preceding monthly payment.
"Balloon Payment": A payment of the unamortized principal
balance of a Mortgage Loan in a single
payment at the maturity of such Mortgage
Loan that is substantially greater than the
preceding Monthly Payment.
"Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11
of the United States Code), as amended.
"Bankruptcy Loss": With respect to any Mortgage Loan, a
Realized Loss resulting from a Deficient
Valuation or Debt Service Reduction.
"Book-Entry Certificate": The Class A Certificates and the
Mezzanine Certificates for so long as the
Certificates of such Class shall be
registered in the name of the Depository or
its nominee.
"Book-Entry Custodian": The custodian appointed pursuant to
Section 5.01.
"Business Day": Any day other than a Saturday, a Sunday or a
day on which banking or savings and loan
institutions in the State of
California, State of Florida, Commonwealth
of Pennsylvania, State of New York or
in the city in which the Corporate Trust
Office of the Trustee is located, are
authorized or obligated by law or executive
order to be closed.
"Cap Amount": For each Class of Class A Certificates and
Mezzanine Certificates, an amount equal to
(i) the aggregate amount received by
the Trust Fund from the related Cap
Contract, multiplied by (ii) a fraction
equal to (a) the Certificate Principal
Balance of such Class immediately prior
to the applicable Distribution Date divided
by (b) the aggregate Certificate
Principal Balance immediately prior to the
applicable Distribution Date of all
Classes of Class A Certificates or
Mezzanine Certificates, directly benefiting
from such Cap Contract.
"Cap Contracts": Collectively, the Class A Cap Contract and
the Mezzanine Cap Contract.
"Cash-Out Refinancing": A Refinanced Mortgage Loan the
proceeds of which are more than a nominal
amount in excess of the principal
balance of any existing first mortgage or
subordinate mortgage on the related
Mortgaged Property and related closing
costs.
3
<PAGE>
"Certificate": Any one of the Citigroup Mortgage Loan Trust,
Series 2005-OPT1, Asset Backed Pass-Through
Certificates, Class A-1A, Class
A-1B, Class A-1C, Class M-1, Class M-2,
Class M-3, Class M-4, Class M-5, Class
M-6, Class M-7, Class M-8, Class M-9, Class
M-10, Class CE, Class P, Class R and
Class R-X issued under this Agreement.
"Certificate Factor": With respect to any Class of Regular
Certificates as of any Distribution Date, a
fraction, expressed as a decimal
carried to six places, the numerator of
which is the aggregate Certificate
Principal Balance (or the Notional Amount,
in the case of the Class CE
Certificates) of such Class of Certificates
on such Distribution Date (after
giving effect to any distributions of
principal and in the case of the Mezzanine
Certificates and the Class CE Certificates,
the allocations of Realized Losses
in reduction of the Certificate Principal
Balance (or the Notional Amount, in
the case of the Class CE Certificates) of
such Class of Certificates to be made
on such Distribution Date), and the
denominator of which is the initial
aggregate Certificate Principal Balance (or
the Notional Amount, in the case of
the Class CE Certificates) of such Class of
Certificates as of the Closing Date.
"Certificate Margin": With respect to each Class of Class A
Certificates and Mezzanine Certificates and
for purposes of the Marker Rate and
the Maximum I-LTZZ Uncertificated Interest
Deferral Amount, the specified REMIC
I Regular Interest, as follows:
Class
REMIC I Regular Interest
Certificate Margin
-----
------------------------
------------------
(1) (%)
(2) (%)
-------
-------
A-1A
I-LTA1A
0.090%
0.180%
A-1B
I-LTA1A
0.210%
0.420%
A-1C
I-LTA1C
0.350%
0.700%
M-1
I-LTM1
0.420%
0.630%
M-2
I-LTM2
0.440%
0.660%
M-3
I-LTM3
0.470%
0.705%
M-4
I-LTM4
0.700%
1.050%
M-5
I-LTM5
0.730%
1.095%
M-6
I-LTM6
0.760%
1.140%
M-7
I-LTM7
1.240%
1.860%
M-8
I-LTM8
1.290%
1.935%
M-9
I-LTM9
2.250%
3.375%
M-10
I-LTM10
2.250%
3.375%
____________
(1) For each Interest Accrual Period
for each Distribution Date on or prior to
the Optional
Termination Date.
(2) For each other Interest Accrual
Period.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the
Certificate Register, except that a
Disqualified Organization or a Non-United
States Person shall not be a Holder of
a Residual Certificate for any purposes
hereof and, solely for the purposes of
giving any consent pursuant to this
Agreement, any Certificate registered in the
name of the Depositor or the Servicer or
any Affiliate thereof shall be deemed
not to be outstanding and the Voting Rights
to which it is entitled shall not be
taken into account in determining whether
the requisite percentage of Voting
Rights necessary to effect any such consent
has been obtained, except as
otherwise provided in Section 11.01. The
Trustee may conclusively rely upon a
certificate of the Depositor or the
Servicer in determining whether a
Certificate is held by an Affiliate
thereof. All references herein to "Holders"
or "Certificateholders" shall reflect the
rights of Certificate Owners as they
may indirectly exercise such rights through
the Depository and participating
members thereof, except as otherwise
specified herein; provided, however, that
the Trustee shall be required to recognize
as a "Holder" or
4
<PAGE>
"Certificateholder" only the Person in
whose name a Certificate is registered in
the Certificate Register.
"Certificate Owner": With respect to a Book-Entry Certificate,
the Person who is the beneficial owner of
such Certificate as reflected on the
books of the Depository or on the books of
a Depository Participant or on the
books of an indirect participating
brokerage firm for which a Depository
Participant acts as agent.
"Certificate Principal Balance": With respect to each Class A
Certificate, Mezzanine Certificate or Class
P Certificate as of any date of
determination, the Certificate Principal
Balance of such Certificate on the
Distribution Date immediately prior to such
date of determination plus any
Subsequent Recoveries added to the
Certificate Principal Balance of such
Certificate pursuant to Section 4.01, minus
all distributions allocable to
principal made thereon and, in the case of
the Mezzanine Certificates, Realized
Losses allocated thereto on such
immediately prior Distribution Date (or, in the
case of any date of determination up to and
including the first Distribution
Date, the initial Certificate Principal
Balance of such Certificate, as stated
on the face thereof). With respect to each
Class CE Interest as of any date of
determination, an amount equal to the
Percentage Interest evidenced by such
Certificate times the excess, if any, of
(A) the then aggregate Uncertificated
Balance of the REMIC I Regular Interests
over (B) the then aggregate Certificate
Principal Balance of the Class A
Certificates, the Mezzanine Certificates and
the Class P Certificates then
outstanding.
"Certificate Register": The register maintained pursuant to
Section 5.02.
"Class": Collectively, all of the Certificates bearing the
same class designation.
"Class A Cap Contract": The cap contract between the Trustee
on behalf of the Trust and the counterparty
thereunder for the benefit of the
Holders of the Class A Certificates in the
form attached hereto as Exhibit K.
"Class A-1A Certificates": Any one of the Class A-1A
Certificates executed, authenticated and
delivered by the Trustee, substantially
in the form annexed hereto as Exhibit A-1
and evidencing a Regular Interest in
REMIC II for purposes of the REMIC
Provisions.
"Class A-1B Certificates": Any one of the Class A-1B
Certificates executed, authenticated and
delivered by the Trustee, substantially
in the form annexed hereto as Exhibit A-2
and evidencing a Regular Interest in
REMIC II for purposes of the REMIC
Provisions.
"Class A-1C Certificates": Any one of the Class A-1C
Certificates executed, authenticated and
delivered by the Trustee, substantially
in the form annexed hereto as Exhibit A-3
and evidencing a Regular Interest in
REMIC II for purposes of the REMIC
Provisions.
"Class A Certificates": Collectively, the Class A-1A
Certificates, the Class A-1B Certificates
and the Class A-1C Certificates.
5
<PAGE>
"Class CE Certificate": Any one of the Class CE Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-14 and
evidencing a Regular Interest in REMIC III
for purposes of the REMIC Provisions.
"Class CE Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the
Holders of the Class C Certificates,
evidencing a Regular Interest in REMIC II
for purposes of the REMIC Provisions.
"Class M-1 Certificate": Any one of the Class M-1 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-4 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-1 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date) and (ii) the Certificate Principal
Balance of the Class M-1 Certificates
immediately prior to such Distribution Date
over (y) the lesser of (A) the
product of (i) approximately 67.20% and
(ii) the aggregate Stated Principal
Balance of the Mortgage Loans as of the
last day of the related Due Period
(after giving effect to scheduled payments
of principal due during the related
Due Period, to the extent received or
advanced, and unscheduled collections of
principal received during the related
Prepayment Period) and (B) the aggregate
Stated Principal Balance of the Mortgage
Loans as of the last day of the related
Due Period (after giving effect to
scheduled payments of principal due during
the related Due Period, to the extent
received or advanced, and unscheduled
collections of principal received during
the related Prepayment Period) minus
$4,069,522.
"Class M-2 Certificate": Any one of the Class M-2 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-5 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-2 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date) and (iii) the Certificate
Principal Balance of the Class M-2
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) approximately
73.10% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due Period
(after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled collections of
principal received during the
related Prepayment Period) and (B) the
aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the
related Due Period (after giving effect
to scheduled payments of principal due
during the related Due Period, to the
extent received or advanced, and
unscheduled collections of principal received
during the related Prepayment Period) minus
$4,069,522.
6
<PAGE>
"Class M-3 Certificate": Any one of the Class M-3 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-6 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-3 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date) and (iv) the Certificate Principal
Balance of the Class M-3 Certificates
immediately prior to such Distribution Date
over (y) the lesser of (A) the
product of (i) approximately 76.90% and
(ii) the aggregate Stated Principal
Balance of the Mortgage Loans as of the
last day of the related Due Period
(after giving effect to scheduled payments
of principal due during the related
Due Period, to the extent received or
advanced, and unscheduled collections of
principal received during the related
Prepayment Period) and (B) the aggregate
Stated Principal Balance of the Mortgage
Loans as of the last day of the related
Due Period (after giving effect to
scheduled payments of principal due during
the related Due Period, to the extent
received or advanced, and unscheduled
collections of principal received during
the related Prepayment Period) minus
$4,069,522.
"Class M-4 Certificate": Any one of the Class M-4 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-7 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-4 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the distribution
of the Class M-3 Principal
Distribution Amount on such Distribution
Date) and (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution
Date over (y) the lesser of (A) the product
of (i) approximately 80.20% and (ii)
the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day
of the related Due Period (after giving
effect to scheduled payments of
principal due during the related Due
Period, to the extent received or advanced,
and unscheduled collections of principal
received during the related Prepayment
Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due Period
(after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled collections of
principal received during the
related Prepayment Period) minus
$4,069,522.
7
<PAGE>
"Class M-5 Certificate": Any one of the Class M-5 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-8 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-5 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the distribution
of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-4 Principal
Distribution Amount on such Distribution
Date) and (vi) the Certificate
Principal Balance of the Class M-5
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) approximately
83.40% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due Period
(after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled collections of
principal received during the
related Prepayment Period) and (B) the
aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the
related Due Period (after giving effect
to scheduled payments of principal due
during the related Due Period, to the
extent received or advanced, and
unscheduled collections of principal received
during the related Prepayment Period) minus
$4,069,522.
"Class M-6 Certificate": Any one of the Class M-6 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-9 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-6 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distributions of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the distribution
of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-4 Principal
Distribution Amount on such Distribution
Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-5 Principal
Distribution Amount on such Distribution
Date) and (vii) the Certificate
Principal Balance of the Class M-6
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of
8
<PAGE>
(i) approximately 86.30% and (ii) the
aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the
related Due Period (after giving effect
to scheduled payments of principal due
during the related Due Period, to the
extent received or advanced, and
unscheduled collections of principal received
during the related Prepayment Period) and
(B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the
last day of the related Due Period
(after giving effect to scheduled payments
of principal due during the related
Due Period, to the extent received or
advanced, and unscheduled collections of
principal received during the related
Prepayment Period) minus $4,069,522.
"Class M-7 Certificate": Any one of the Class M-7 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-10 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-7 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the distribution
of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-4 Principal
Distribution Amount on such Distribution
Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Certificate Principal
Balance of the Class M-6 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-6 Principal
Distribution Amount on such Distribution
Date) and (viii) the Certificate
Principal Balance of the Class M-7
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) approximately
88.80% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due Period
(after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled collections of
principal received during the
related Prepayment Period) and (B) the
aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the
related Due Period (after giving effect
to scheduled payments of principal due
during the related Due Period, to the
extent received or advanced, and
unscheduled collections of principal received
during the related Prepayment Period) minus
$4,069,522.
"Class M-8 Certificate": Any one of the Class M-8 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-11 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-8 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
9
<PAGE>
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the
distribution of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the distribution
of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the
distribution of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution Date
(after taking into account the
distribution of the Class M-4 Principal
Distribution Amount on such Distribution
Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates
immediately prior to such Distribution Date
(after taking into account the
distribution of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Certificate Principal
Balance of the Class M-6 Certificates
immediately prior to such Distribution Date
(after taking into account the
distribution of the Class M-6 Principal
Distribution Amount on such Distribution
Date), (viii) the Certificate Principal
Balance of the Class M-7 Certificates
immediately prior to such Distribution Date
(after taking into account the
distribution of the Class M-7 Principal
Distribution Amount on such Distribution
Date) and (viii) the Certificate Principal
Balance of the Class M-8 Certificates
immediately prior to such Distribution Date
over (y) the lesser of (A) the
product of (i) approximately 90.40% and
(ii) the aggregate Stated Principal
Balance of the Mortgage Loans as of the
last day of the related Due Period
(after giving effect to scheduled payments
of principal due during the related
Due Period, to the extent received or
advanced, and unscheduled collections of
principal received during the related
Prepayment Period) and (B) the aggregate
Stated Principal Balance of the Mortgage
Loans as of the last day of the related
Due Period (after giving effect to
scheduled payments of principal due during
the related Due Period, to the extent
received or advanced, and unscheduled
collections of principal received during
the related Prepayment Period) minus
$4,069,522.
"Class M-9 Certificate": Any one of the Class M-9 Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-12 and
evidencing a Regular Interest in REMIC II for
purposes of the REMIC Provisions.
"Class M-9 Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
sum of (i) the aggregate Certificate
Principal Balance of the Class A
Certificates (after taking into account the
distribution of the Senior Principal
Distribution Amount on such Distribution
Date), (ii) the Certificate Principal
Balance of the Class M-1 Certificates
(after taking into account the distribution
of the Class M-1 Principal
Distribution Amount on such Distribution
Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates
(after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the distribution
of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-4 Principal
Distribution Amount on such Distribution
Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-5 Principal
Distribution Amount
10
<PAGE>
on such Distribution Date), (vii) the
Certificate Principal Balance of the Class
M-6 Certificates immediately prior to such
Distribution Date (after taking into
account the distribution of the Class M-6
Principal Distribution Amount on such
Distribution Date), (viii) the Certificate
Principal Balance of the Class M-7
Certificates immediately prior to such
Distribution Date (after taking into
account the distribution of the Class M-7
Principal Distribution Amount on such
Distribution Date), (ix) the Certificate
Principal Balance of the Class M-8
Certificates immediately prior to such
Distribution Date (after taking into
account the distribution of the Class M-8
Principal Distribution Amount on such
Distribution Date) and (x) the Certificate
Principal Balance of the Class M-9
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) approximately 92.40%
and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due
Period (after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled
collections of principal received during
the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day
of the related Due Period (after giving
effect to scheduled payments of
principal due during the related Due
Period, to the extent received or advanced,
and unscheduled collections of principal
received during the related Prepayment
Period) minus $4,069,522.
"Class M-10 Certificate": Any one of the Class M-10
Certificates executed, authenticated and
delivered by the Trustee, substantially
in the form annexed hereto as Exhibit A-13
and evidencing a Regular Interest in
REMIC II for purposes of the REMIC
Provisions.
"Class M-10 Principal Distribution Amount": With respect to
any Distribution Date, the excess of (x)
the sum of (i) the aggregate
Certificate Principal Balance of the Class
A Certificates (after taking into
account the distribution of the Senior
Principal Distribution Amount on such
Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1
Certificates (after taking into account the
distribution of the Class M-1
Principal Distribution Amount on such
Distribution Date), (iii) the Certificate
Principal Balance of the Class M-2
Certificates (after taking into account the
distribution of the Class M-2 Principal
Distribution Amount on such Distribution
Date), (iv) the Certificate Principal
Balance of the Class M-3 Certificates
(after taking into account the distribution
of the Class M-3 Principal
Distribution Amount on such Distribution
Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-4 Principal
Distribution Amount on such Distribution
Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-5 Principal
Distribution Amount on such Distribution
Date), (vii) the Certificate Principal
Balance of the Class M-6 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-6 Principal
Distribution Amount on such Distribution
Date), (viii) the Certificate Principal
Balance of the Class M-7 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-7 Principal
Distribution Amount on such Distribution
Date), (ix) the Certificate Principal
Balance of the Class M-8 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-8 Principal
Distribution Amount on such Distribution
Date), (x) the Certificate Principal
Balance of the Class M-9 Certificates
immediately prior to such Distribution
Date (after taking into account the
distribution of the Class M-9 Principal
Distribution Amount on such
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<PAGE>
Distribution Date) and (xi) the Certificate
Principal Balance of the Class M-10
Certificates immediately prior to such
Distribution Date over (y) the lesser of
(A) the product of (i) approximately 94.60%
and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due
Period (after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled
collections of principal received during
the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day
of the related Due Period (after giving
effect to scheduled payments of
principal due during the related Due
Period, to the extent received or advanced,
and unscheduled collections of principal
received during the related Prepayment
Period) minus $4,069,522.
"Class M Principal Distribution Amount": The Class M-1
Principal Distribution Amount, Class M-2
Principal Distribution Amount, Class
M-3 Principal Distribution Amount, Class
M-4 Principal Distribution Amount,
Class M-5 Principal Distribution Amount,
Class M-6 Principal Distribution
Amount, Class M-7 Principal Distribution
Amount, Class M-8 Principal
Distribution Amount, Class M-9 Principal
Distribution Amount or Class M-10
Principal Distribution Amount, as the
context requires.
"Class P Certificate": Any one of the Class P Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-15 and
evidencing a Regular Interest in REMIC IV for
purposes of the REMIC Provisions.
"Class P Interest": An uncertificated interest in the Trust
Fund held by the Trustee on behalf of the
Holders of the Class P Certificates,
evidencing a Regular Interest in REMIC II
for purposes of the REMIC Provisions.
"Class R Certificate": Any one of the Class R Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-16 and
evidencing the ownership of the Class R-I
Interest and the Class R-II Interest.
"Class R-X Certificate": Any one of the Class R-X Certificates
executed, authenticated and delivered by
the Trustee, substantially in the form
annexed hereto as Exhibit A-17 and
evidencing the ownership of the Class R-III
Interest and the Class R-IV Interest.
"Class R-I Interest": The uncertificated Residual Interest in
REMIC I.
"Class R-II Interest": The uncertificated Residual Interest in
REMIC II.
"Class R-III Interest": The uncertificated Residual Interest
in REMIC III.
"Class R-IV Interest": The uncertificated Residual Interest in
REMIC IV.
"Closing Date": February 8, 2005.
"Code": The Internal Revenue Code of 1986, as amended.
12
<PAGE>
"Collection Account": The account or accounts created and
maintained, or caused to be created and
maintained, by the Servicer pursuant to
Section 3.10(a), which shall be entitled
"Option One Mortgage Corporation, as
Servicer for Deutsche Bank National Trust
Company, as Trustee, in trust for the
registered holders of Citigroup Mortgage
Loan Trust, Series 2005-OPT1, Asset
Backed Pass-Through Certificates." The
Collection Account must be an Eligible
Account.
"Commission": The Securities and Exchange Commission.
"Compensating Interest": As defined in Section 3.24 hereof.
"Corporate Trust Office": The principal corporate trust office
of the Trustee at which at any particular
time its corporate trust business in
connection with this Agreement shall be
administered, which office at the date
of the execution of this instrument is
located at 1761 East St. Andrew Place,
Santa Ana, CA 92705-4934, Attn: CI05O1, or
at such other address as the Trustee
may designate from time to time by notice
to the Certificateholders, the
Depositor and the Servicer.
"Corresponding Certificate": With respect to each REMIC I
Regular Interest set forth below, the
Regular Certificate set forth in the table
below:
REMIC I REGULAR INTEREST
CERTIFICATE
------------------------
-----------
I-LTA1A
Class A-1A
I-LTA1B
Class A-1B
I-LTA1C
Class A-1C
I-LTM1
Class M-1
I-LTM2
Class M-2
I-LTM3
Class M-3
I-LTM4
Class M-4
I-LTM5
Class M-5
I-LTM6
Class M-6
I-LTM7
Class M-7
I-LTM8
Class M-8
I-LTM9
Class M-9
I-LTM10
Class M-10
I-LTP
Class P
"Credit Enhancement Percentage": For any Distribution Date,
the percentage equivalent of a fraction,
the numerator of which is the sum of
the aggregate Certificate Principal
Balances of the Mezzanine Certificates and
the Class CE Certificates calculated after
taking into account payments of
principal on the Mortgage Loans and
distribution of the Principal Distribution
Amount to the Certificates then entitled to
distributions of principal on such
Distribution Date, and the denominator of
which is the aggregate Stated
Principal Balance of the Mortgage Loans as
of the last day of the related Due
Period (after giving effect to scheduled
payments of principal due during the
related Due Period, to the extent received
or advanced, and unscheduled
collections of principal received during
the related Prepayment Period).
"Cumulative Loss Percentage": With respect to any Distribution
Date, the percentage equivalent of a
fraction, the numerator of which is the
aggregate amount of Realized Losses
incurred from the Cut-off Date to the last
day of the preceding calendar month and
the
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<PAGE>
denominator of which is the aggregate
Stated Principal Balance of the Mortgage
Loans as of the Cut-off Date.
"Custodial Agreement": The Custodial Agreement, dated February
1, 2005, among the Custodian, the Trustee
and the Servicer.
"Custodian": Wells Fargo Bank, N.A. as Custodian of the
Mortgage Files, or any successor thereto,
pursuant to the Custodial Agreement.
"Cut-off Date": With respect to each Mortgage Loan, February
1, 2005. With respect to all Qualified
Substitute Mortgage Loans, their
respective dates of substitution.
References herein to the "Cut-off Date," when
used with respect to more than one Mortgage
Loan, shall be to the respective
Cut-off Dates for such Mortgage Loans.
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment
for such Mortgage Loan by a court of
competent jurisdiction in a proceeding
under the Bankruptcy Code, except such a
reduction resulting from a Deficient
Valuation.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property
by a court of competent jurisdiction
in an amount less than the then outstanding
Stated Principal Balance of the
Mortgage Loan, which valuation results from
a proceeding initiated under the
Bankruptcy Code.
"Definitive Certificates": As defined in Section 5.01(b).
"Deleted Mortgage Loan": A Mortgage Loan replaced or to be
replaced by a Qualified Substitute Mortgage
Loan.
"Delinquency Percentage": As of the last day of the related
Due Period, the percentage equivalent of a
fraction, the numerator of which is
the aggregate Stated Principal Balance of
the Mortgage Loans that, as of the
last day of the previous calendar month,
are 60 or more days delinquent, are in
foreclosure, have been converted to REO
Properties or in bankruptcy (and
delinquent 60 days or more), and the
denominator of which is the aggregate
Stated Principal Balance of the Mortgage
Loans and REO Properties as of the last
day of the previous calendar month;
provided, however, that any Mortgage Loan
purchased by the Servicer pursuant to
Section 3.16(c) shall not be included in
either the numerator or the denominator for
purposes of calculating the
Delinquency Percentage.
"Depositor": Citigroup Mortgage Loan Trust Inc., a Delaware
corporation, or its successor in
interest.
"Depository": The Depository Trust Company, or any successor
Depository hereafter named. The nominee of
the initial Depository, for purposes
of registering those Certificates that are
to be Book-Entry Certificates, is
CEDE & Co. The Depository shall at all
times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform
Commercial
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<PAGE>
Code of the State of New York and a
"clearing agency" registered pursuant to the
provisions of Section 17A of the Securities
Exchange Act of 1934, as amended.
"Depository Institution": Any depository institution or trust
company, including the Trustee, that (a) is
incorporated under the laws of the
United States of America or any State
thereof, (b) is subject to supervision and
examination by federal or state banking
authorities and (c) has outstanding
unsecured commercial paper or other
short-term unsecured debt obligations (or,
in the case of a depository institution
that is the principal subsidiary of a
holding company, such holding company has
unsecured commercial paper or other
short-term unsecured debt obligations) that
are rated at least P-1 by Moody's,
F-1 by Fitch (if rated by Fitch) and A-1 by
S&P.
"Depository Participant": A broker, dealer, bank or other
financial institution or other Person for
whom from time to time a Depository
effects book-entry transfers and pledges of
securities deposited with the
Depository.
"Determination Date": With respect to each Distribution Date,
the 15th day of the calendar month in which
such Distribution Date occurs or, if
such 15th day is not a Business Day, the
Business Day immediately preceding such
15th day.
"Directly Operate": With respect to any REO Property, the
furnishing or rendering of services to the
tenants thereof, the management or
operation of such REO Property, the holding
of such REO Property primarily for
sale to customers, the performance of any
construction work thereon or any use
of such REO Property in a trade or business
conducted by REMIC I other than
through an Independent Contractor;
provided, however, that the Trustee (or the
Servicer on behalf of the Trustee) shall
not be considered to Directly Operate
an REO Property solely because the Trustee
(or the Servicer on behalf of the
Trustee) establishes rental terms, chooses
tenants, enters into or renews
leases, deals with taxes and insurance, or
makes decisions as to repairs or
capital expenditures with respect to such
REO Property.
"Disqualified Organization": Any of the following: (i) the
United States, any State or political
subdivision thereof, any possession of the
United States, or any agency or
instrumentality of any of the foregoing (other
than an instrumentality which is a
corporation if all of its activities are
subject to tax and, except for Freddie Mac,
a majority of its board of directors
is not selected by such governmental unit),
(ii) any foreign government, any
international organization, or any agency
or instrumentality of any of the
foregoing, (iii) any organization (other
than certain farmers' cooperatives
described in Section 521 of the Code) which
is exempt from the tax imposed by
Chapter 1 of the Code (including the tax
imposed by Section 511 of the Code on
unrelated business taxable income), (iv)
rural electric and telephone
cooperatives described in Section
1381(a)(2)(C) of the Code, (v) an "electing
large partnership" and (vi) any other
Person as set forth in an Opinion of
Counsel delivered to the Trustee and the
Depositor to the effect that the
holding of an Ownership Interest in a
Residual Certificate by such Person may
cause any Trust REMIC or any Person having
an Ownership Interest in any Class of
Certificates (other than such Person) to
incur a liability for any federal tax
imposed under the Code that would not
otherwise be imposed but for the Transfer
of an Ownership Interest in a Residual
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<PAGE>
Certificate to such Person. The terms
"United States," "State" and
"international organization" shall have the
meanings set forth in Section 7701
of the Code or successor provisions.
"Distribution Account": The trust account or accounts created
and maintained by the Trustee pursuant to
Section 3.10(b), which shall be
entitled "Deutsche Bank National Trust
Company, as Trustee, in trust for the
registered holders of Citigroup Mortgage
Loan Trust, Series 2005-OPT1, Asset
Backed Pass-Through Certificates." The
Distribution Account must be an Eligible
Account.
"Distribution Date": The 25th day of any month, or if such
25th day is not a Business Day, the
Business Day immediately following such 25th
day, commencing in March 2005.
"Due Date": With respect to each Mortgage Loan and any
Distribution Date, the first day of the
calendar month in which such
Distribution Date occurs on which the
Monthly Payment for such Mortgage Loan was
due (or, in the case of any Mortgage Loan
under terms of which the Monthly
Payment for such Mortgage Loan was due on a
day other than the first day of the
calendar month in which such Distribution
Date occurs, the day during the
related Due Period on which such Monthly
Payment was due), in each case
exclusive of any days of grace.
"Due Period": With respect to any Distribution Date, the
period commencing on the second day of the
month immediately preceding the month
in which such Distribution Date occurs and
ending on the first day of the month
of such Distribution Date.
"Eligible Account": Any of (i) an account or accounts
maintained with a Depository Institution,
(ii) an account or accounts the
deposits in which are fully insured by the
FDIC or (iii) a segregated
non-interest bearing trust account or
accounts maintained with the corporate
trust department of a federal depository
institution or state-chartered
depository institution subject to
regulations regarding fiduciary funds on
deposit similar to Title 12 of the Code of
Federal Regulation Section 9.10(b),
which, in either case, has corporate trust
powers, acting in its fiduciary
capacity.
"ERISA": The Employee Retirement Income Security Act of 1974,
as amended.
"Escrow Payments": The amounts constituting ground rents,
taxes, assessments, water rates, fire and
hazard insurance premiums and other
payments required to be escrowed by the
Mortgagor with the mortgagee pursuant to
any Mortgage Loan.
"Estate in Real Property": A fee simple estate in a parcel of
land.
"Excess Overcollateralized Amount": With respect to the Class
A Certificates and the Mezzanine
Certificates and any Distribution Date, the
excess, if any, of (i) the
Overcollateralized Amount for such Distribution Date
(calculated for this purpose only after
assuming that 100% of the Principal
Remittance Amount on such Distribution Date
has been distributed) over (ii) the
Overcollateralization Target Amount for
such Distribution Date.
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<PAGE>
"Expense Adjusted Maximum Mortgage Rate": With respect to any
Mortgage Loan (or the related REO
Property), as of any date of determination, a
per annum rate of interest equal to the
applicable Maximum Mortgage Rate (or the
applicable Mortgage Rate in the case of any
Fixed-Rate Mortgage Loan) thereon as
of the first day of the related Due Period
minus the sum of (i) the Trustee Fee
Rate and (ii) the Servicing Fee Rate.
"Expense Adjusted Mortgage Rate": With respect to any Mortgage
Loan (or the related REO Property), as of
any date of determination, a per annum
rate of interest equal to the applicable
Mortgage Rate thereon as of the first
day of the related Due Period minus the sum
of (i) the Trustee Fee Rate and (ii)
the Servicing Fee Rate.
"Extraordinary Trust Fund Expense": Any amounts reimbursable
to the Trustee or any director, officer,
employee or agent of the Trustee from
the Trust Fund pursuant to Section 8.05 or
Section 10.01(c) and any amounts
payable from the Distribution Account in
respect of taxes pursuant to Section
10.01(g)(iii).
"Fannie Mae": Fannie Mae, formally known as the Federal
National Mortgage Association, or any
successor thereto.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other
than a Mortgage Loan or REO Property
purchased by the Originator, the Depositor
or the Servicer pursuant to or as
contemplated by Section 2.03, Section
3.16(c) or Section 9.01), a determination
made by the Servicer that all Insurance
Proceeds, Liquidation Proceeds and other
payments or recoveries which the Servicer,
in its reasonable good faith
judgment, expects to be finally recoverable
in respect thereof have been so
recovered. The Servicer shall maintain
records, prepared by a Servicing Officer,
of each Final Recovery Determination made
thereby.
"Fitch": Fitch Ratings, or its successor in interest.
"Fixed-Rate Mortgage Loan": Each of the Mortgage Loans
identified on the Mortgage Loan Schedule as
having a fixed Mortgage Rate.
"Formula Rate": For any Distribution Date and the Class A
Certificates and the Mezzanine
Certificates, the lesser of (i) One-Month LIBOR
plus the related Certificate Margin and
(ii) the Maximum Cap Rate.
"Freddie Mac": Freddie Mac, formally known as the Federal Home
Loan Mortgage Corporation, or any successor
thereto.
"Gross Margin": With respect to each Adjustable-Rate Mortgage
Loan, the fixed percentage set forth in the
related Mortgage Note that is added
to the Index on each Adjustment Date in
accordance with the terms of the related
Mortgage Note used to determine the
Mortgage Rate for such Adjustable-Rate
Mortgage Loan.
17
<PAGE>
"Highest Priority": As of any date of determination, the Class
of Mezzanine Certificates then outstanding
with a Certificate Principal Balance
greater than zero, with the highest
priority for payments pursuant to Section
4.01, in the following order: Class M-1,
Class M-2, Class M-3, Class M-4, Class
M-5, Class M-6, Class M-7, Class M-8, Class
M-9 and Class M-10 Certificates.
"Indenture": An indenture relating to the issuance of notes
secured by the Class CE Certificates, the
Class P Certificates and/or the Class
R Certificates (or any portion
thereof).
"Independent": When used with respect to any specified Person,
any such Person who (a) is in fact
independent of the Depositor, the Servicer,
the Seller and their respective Affiliates,
(b) does not have any direct
financial interest in or any material
indirect financial interest in the
Depositor, the Servicer, the Seller or any
Affiliate thereof, and (c) is not
connected with the Depositor, the Servicer,
the Seller or any Affiliate thereof
as an officer, employee, promoter,
underwriter, trustee, partner, director or
Person performing similar functions;
provided, however, that a Person shall not
fail to be Independent of the Depositor,
the Servicer, the Seller or any
Affiliate thereof merely because such
Person is the beneficial owner of 1% or
less of any class of securities issued by
the Depositor, the Servicer, the
Seller or any Affiliate thereof, as the
case may be.
"Independent Contractor": Either (i) any Person (other than
the Servicer) that would be an "independent
contractor" with respect to REMIC I
within the meaning of Section 856(d)(3) of
the Code if REMIC I were a real
estate investment trust (except that the
ownership tests set forth in that
section shall be considered to be met by
any Person that owns, directly or
indirectly, 35% or more of any Class of
Certificates), so long as REMIC I does
not receive or derive any income from such
Person and provided that the
relationship between such Person and REMIC
I is at arm's length, all within the
meaning of Treasury Regulation Section
1.856-4(b)(5), or (ii) any other Person
(including the Servicer) if the Trustee has
received an Opinion of Counsel to
the effect that the taking of any action in
respect of any REO Property by such
Person, subject to any conditions therein
specified, that is otherwise herein
contemplated to be taken by an Independent
Contractor will not cause such REO
Property to cease to qualify as
"foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined
without regard to the exception
applicable for purposes of Section 860D(a)
of the Code), or cause any income
realized in respect of such REO Property to
fail to qualify as Rents from Real
Property.
"Index": With respect to each Adjustable-Rate Mortgage Loan
and each related Adjustment Date, the index
specified in the related Mortgage
Note.
"Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a
Mortgage Loan, to the extent such
proceeds are not to be applied to the
restoration of the related Mortgaged
Property or released to the Mortgagor in
accordance with the procedures that the
Servicer would follow in servicing mortgage
loans held for its own account,
subject to the terms and conditions of the
related Mortgage Note and Mortgage.
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<PAGE>
"Interest Accrual Period": With respect to any Distribution
Date and the Class A Certificates and the
Mezzanine Certificates, the period
commencing on the Distribution Date of the
month immediately preceding the month
in which such Distribution Date occurs (or,
in the case of the first
Distribution Date, commencing on the
Closing Date) and ending on the day
preceding such Distribution Date. With
respect to any Distribution Date and the
Class CE Certificates and the REMIC Regular
Interests, the one-month period
ending on the last day of the calendar
month preceding the month in which such
Distribution Date occurs.
"Interest Carry Forward Amount": With respect to any
Distribution Date and the Class A
Certificates or the Mezzanine Certificates,
the sum of (i) the amount, if any, by which
(a) the Interest Distribution Amount
for such Class of Certificates as of the
immediately preceding Distribution Date
exceeded (b) the actual amount distributed
on such Class of Certificates in
respect of interest on such immediately
preceding Distribution Date, (ii) the
amount of any Interest Carry Forward Amount
for such Class of Certificates
remaining unpaid from the previous
Distribution Date and (iii) accrued interest
on the sum of (i) and (ii) above calculated
at the related Pass-Through Rate for
the most recently ended Interest Accrual
Period.
"Interest Determination Date": With respect to the Class A
Certificates, the Mezzanine Certificates,
REMIC I Regular Interest I-LTA1A,
REMIC I Regular Interest I-LTA1B, REMIC I
Regular Interest I-LTA1C, REMIC I
Regular Interest I-LTM1, REMIC I Regular
Interest I-LTM2, REMIC I Regular
Interest I-LTM3, REMIC I Regular Interest
I-LTM4, REMIC I Regular Interest
I-LTM5, REMIC I Regular Interest I-LTM6,
REMIC I Regular Interest I-LTM7, REMIC
I Regular Interest I-LTM8, REMIC I Regular
Interest I-LTM9 and REMIC I Regular
Interest I-LTM10, and any Interest Accrual
Period therefor, the second London
Business Day preceding the commencement of
such Interest Accrual Period.
"Interest Distribution Amount": With respect to any
Distribution Date and the Class A
Certificates, the Mezzanine Certificates and
the Class CE Certificates, the aggregate
Accrued Certificate Interest on the
Certificates of such Class for such
Distribution Date.
"Interest Remittance Amount": For any Distribution Date, that
portion of the Available Distribution
Amount for the related Distribution Date
that represents interest received or
advanced on the Mortgage Loans.
"Late Collections": With respect to any Mortgage Loan and any
Due Period, all amounts received subsequent
to the Determination Date
immediately following such Due Period,
whether as late payments of Monthly
Payments or as Insurance Proceeds,
Liquidation Proceeds or otherwise, which
represent late payments or collections of
principal and/or interest due (without
regard to any acceleration of payments
under the related Mortgage and Mortgage
Note) but delinquent for such Due Period
and not previously recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of
the following events: (i) such Mortgage
Loan is paid in full; (ii) a Final
Recovery Determination is made as to such
Mortgage Loan; or (iii) such Mortgage
Loan is removed from REMIC I, by reason of
its being purchased, sold or replaced
pursuant to or as contemplated by Section
2.03, Section 3.16(c) or Section 9.01.
With respect to any REO Property, either of
the following events: (i) a
19
<PAGE>
Final Recovery Determination is made as to
such REO Property; or (ii) such REO
Property is removed from REMIC I by reason
of its being purchased pursuant to
Section 9.01.
"Liquidation Proceeds": The amount (other than Insurance
Proceeds or amounts received in respect of
the rental of any REO Property prior
to REO Disposition) received by the
Servicer in connection with (i) the taking
of all or a part of a Mortgaged Property by
exercise of the power of eminent
domain or condemnation, (ii) the
liquidation of a defaulted Mortgage Loan
through a trustee's sale, foreclosure sale
or otherwise, or (iii) the
repurchase, substitution or sale of a
Mortgage Loan or an REO Property pursuant
to or as contemplated by Section 2.03,
Section 3.16(c), Section 3.23 or Section
9.01.
"Loan-to-Value Ratio": As of any date of determination, the
fraction, expressed as a percentage, the
numerator of which is the principal
balance of the related Mortgage Loan at
such date and the denominator of which
is the Value of the related Mortgaged
Property.
"London Business Day": Any day on which banks in the City of
London and New York are open and conducting
transactions in United States
dollars.
"Marker Rate": With respect to the Class CE Interest and any
Distribution Date, a per annum rate equal
to two (2) times the weighted average
of the REMIC I Remittance Rate for REMIC I
Regular Interest I-LTA1A, REMIC I
Regular Interest I-LTA1B, REMIC I Regular
Interest I-LTA1C, REMIC I Regular
Interest I-LTM1, REMIC I Regular Interest
I-LTM2, REMIC I Regular Interest
I-LTM3, REMIC I Regular Interest I-LTM4,
REMIC I Regular Interest I-LTM5, REMIC
I Regular Interest I-LTM6, REMIC I Regular
Interest I-LTM7, REMIC I Regular
Interest I-LTM8, REMIC I Regular Interest
I-LTM9, REMIC I Regular Interest
I-LTM10 and REMIC I Regular Interest
I-LTZZ, with the rate on each such REMIC I
Regular Interest (other than REMIC I
Regular Interest I-LTZZ) subject to a cap
equal to the lesser of (i) One-Month LIBOR
plus the related Certificate Margin
for the related Corresponding Certificate
and (ii) the related Net WAC
Pass-Through Rate for the related
Corresponding Certificate for the purpose of
this calculation for such Distribution Date
and with the rate on REMIC I Regular
Interest I-LTZZ subject to a cap of zero
for the purpose of this calculation;
provided, however, each cap shall be
multiplied by a fraction, the numerator of
which is the actual number of days elapsed
in the related Interest Accrual
Period and the denominator of which is
30.
"Maximum Cap Rate": For any Distribution Date and the Class A
Certificates and the Mezzanine
Certificates, a per annum rate equal to the
product of (x) the weighted average of the
Expense Adjusted Maximum Mortgage
Rates of the Mortgage Loans, in each case,
weighted on the basis of the
outstanding Stated Principal Balances of
the Mortgage Loans as of the first day
of the month preceding the month of such
Distribution Date (after giving effect
to scheduled payments of principal due
during the related Due Period, to the
extent received or advanced, and
unscheduled collections of principal received
during the related Prepayment Period) and
(y) a fraction, the numerator of which
is 30 and the denominator of which is the
actual number of days elapsed in the
related Interest Accrual Period.
20
<PAGE>
"Maximum I-LTZZ Uncertificated Interest Deferral Amount": With
respect to any Distribution Date, the
excess of (i) accrued interest at the
REMIC I Remittance Rate applicable to REMIC
I Regular Interest I-LTZZ for such
Distribution Date on a balance equal to the
Uncertificated Balance of REMIC I
Regular Interest I-LTZZ minus the REMIC I
Overcollateralized Amount, in each
case for such Distribution Date, over (ii)
Uncertificated Interest on REMIC I
Regular Interest I-LTA1A, REMIC I Regular
Interest I-LTA1B, REMIC I Regular
Interest I-LTA1C, REMIC I Regular Interest
I-LTM1, REMIC I Regular Interest
I-LTM2, REMIC I Regular Interest I-LTM3,
REMIC I Regular Interest I-LTM4, REMIC
I Regular Interest I-LTM5, REMIC I Regular
Interest I-LTM6, REMIC I Regular
Interest I-LTM7, REMIC I Regular Interest
I-LTM8, REMIC I Regular Interest
I-LTM9 and REMIC I Regular Interest I-LTM10
for such Distribution Date, with the
rate on each such REMIC I Regular Interest
subject to a cap equal to the lesser
of (i) One-Month LIBOR plus the related
Certificate Margin for the related
Corresponding Certificate and (ii) the
related Net WAC Pass-Through Rate for the
related Corresponding Certificate;
provided, however, each cap shall be
multiplied by a fraction, the numerator of
which is the actual number of days
elapsed in the related Interest Accrual
Period and the denominator of which is
30.
"Maximum Mortgage Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in
the related Mortgage Note as the
maximum Mortgage Rate thereunder.
"Mezzanine Cap Contract": The cap contract between the Trustee
on behalf of the Trust and the counterparty
thereunder for the benefit of the
Holders of the Mezzanine Certificates in
the form attached hereto as Exhibit K.
"Mezzanine Certificates": The Class M-1 Certificates, the
Class M-2 Certificates, the Class M-3
Certificates, the Class M-4 Certificates,
the Class M-5 Certificates, the Class M-6
Certificates, the Class M-7
Certificates, the Class M-8 Certificates,
the Class M-9 Certificates and the
Class M-10 Certificates.
"Minimum Mortgage Rate": With respect to each Adjustable-Rate
Mortgage Loan, the percentage set forth in
the related Mortgage Note as the
minimum Mortgage Rate thereunder.
"Monthly
Payment": With respect to any Mortgage Loan, the
scheduled monthly payment of principal and
interest on such Mortgage Loan which
is payable by the related Mortgagor from
time to time under the related Mortgage
Note, determined: (a) after giving effect
to (i) any Deficient Valuation and/or
Debt Service Reduction with respect to such
Mortgage Loan and (ii) any reduction
in the amount of interest collectible from
the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to
any extension granted or agreed to by
the Servicer pursuant to Section 3.07 and
(c) on the assumption that all other
amounts, if any, due under such Mortgage
Loan are paid when due.
"Moody's": Moody's Investors Service, Inc., or its successor
in interest.
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"Mortgage": The mortgage, deed of trust or other instrument
creating a first lien or second lien on, or
first or second priority security
interest in, a Mortgaged Property securing
a Mortgage Note.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan
and any additional documents required
to be added to the Mortgage File pursuant
to this Agreement.
"Mortgage Loan": Each mortgage loan transferred and assigned
to the Trustee and delivered to the Trustee
pursuant to Section 2.01 or Section
2.03(b) of this Agreement, as held from
time to time as a part of the Trust
Fund, the Mortgage Loans so held being
identified in the Mortgage Loan Schedule.
"Mortgage Loan Purchase Agreement": The agreement among the
Seller, the Originator and the Depositor,
regarding the sale of the Mortgage
Loans by the Seller to the Depositor,
substantially in the form of Exhibit D
annexed hereto.
"Mortgage Loan Schedule": As of any date, the list of Mortgage
Loans included in REMIC I on such date
attached hereto as Schedule 1. The
Mortgage Loan Schedule shall set forth the
following information with respect to
each Mortgage Loan:
(i) the
Mortgage Loan identifying number;
(ii)
[reserved];
(iii) the
state and zip code of the Mortgaged Property;
(iv)
a code indicating whether the Mortgaged Property is
owner-occupied;
(v) the type
of Residential Dwelling constituting the
Mortgaged Property;
(vi)
the original months to maturity;
(vii) the
stated remaining months to maturity from the
Cut-off Date based on the original amortization schedule;
(viii) the
Loan-to-Value Ratio at origination;
(ix)
the Mortgage Rate in effect immediately following the
Cut-off Date;
(x) (A) the
date on which the first Monthly Payment was
due on the Mortgage Loan and (B) if such date is not consistent
with
the Due Date currently in effect, such Due Date;
(xi)
the stated maturity date;
(xii) the
amount of the Monthly Payment at origination;
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(xiii) the
amount of the Monthly Payment due on the first
Due Date after the Cut-off Date;
(xiv) the
last Due Date on which a Monthly Payment was
actually applied to the unpaid Stated Principal Balance; (xv)
the
original principal amount of the Mortgage Loan;
(xvi) the
Stated Principal Balance of the Mortgage Loan as
of the close of business on the Cut-off Date;
(xvii) with
respect to each Adjustable-Rate Mortgage Loan,
the Adjustment Dates, the Gross Margin, the Maximum Mortgage Rate,
the
Minimum Mortgage Rate, the Periodic Rate Cap, the maximum first
Adjustment Date Mortgage Rate adjustment, the first Adjustment
Date
immediately following the origination date and the rounding code
(i.e.,
nearest 0.125%, next highest 0.125%);
(xviii) a code
indicating the purpose of the Mortgage Loan
(i.e., purchase financing, Rate/Term Refinancing, Cash-Out
Refinancing);
(xix) the
Mortgage Rate at origination;
(xx)
a code indicating the documentation program (i.e.,
Full Documentation, Limited Documentation, Stated Income
Documentation);
(xxi) the
risk grade;
(xxii) the Value
of the Mortgaged Property;
(xxiii) the sale price
of the Mortgaged Property, if
applicable;
(xxiv) the
actual unpaid principal balance of the Mortgage
Loan as of the
Cut-off Date;
(xxv) the
type and term of the related Prepayment Charge;
(xxvi) the
program code; and
(xxviii) the total amount of points and fees charged such
Mortgage Loan.
The Mortgage Loan Schedule shall set forth the following
information with respect to the Mortgage
Loans in the aggregate as of the
Cut-off Date: (1) the number of Mortgage
Loans; (2) the current Stated Principal
Balance of the Mortgage Loans; (3) the
weighted average Mortgage Rate of the
Mortgage Loans and (4) the weighted average
maturity of the Mortgage Loans. The
Mortgage Loan Schedule shall be amended
from time to time by the Depositor in
accordance with the provisions of this
Agreement. With respect to any Qualified
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<PAGE>
Substitute Mortgage Loan, the Cut-off Date
shall refer to the related Cut-off
Date for such Mortgage Loan, determined in
accordance with the definition of
Cut-off Date herein.
"Mortgage Note": The original executed note or other evidence
of the indebtedness of a Mortgagor under a
Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on
Schedule 1 and existing from time to time
thereafter, and any REO Properties
acquired in respect thereof.
"Mortgage Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on
such Mortgage Loan from time to time in
accordance with the provisions of the
related Mortgage Note, which rate (i) with
respect to each Fixed-Rate Mortgage Loan
shall remain constant at the rate set
forth in the Mortgage Loan Schedule as the
Mortgage Rate in effect immediately
following the Cut-off Date and (ii) with
respect to the Adjustable-Rate Mortgage
Loans, (A) as of any date of determination
until the first Adjustment Date
following the Cut-off Date shall be the
rate set forth in the Mortgage Loan
Schedule as the Mortgage Rate in effect
immediately following the Cut-off Date
and (B) as of any date of determination
thereafter shall be the rate as adjusted
on the most recent Adjustment Date equal to
the sum, rounded as provided in the
Mortgage Note, of the Index, as published
as of a date prior to the Adjustment
Date as set forth in the related Mortgage
Note, plus the related Gross Margin;
provided that the Mortgage Rate on such
Adjustable-Rate Mortgage Loan on any
Adjustment Date shall never be more than
the lesser of (i) the sum of the
Mortgage Rate in effect immediately prior
to the Adjustment Date plus the
related Periodic Rate Cap, if any, and (ii)
the related Maximum Mortgage Rate,
and shall never be less than the greater of
(i) the Mortgage Rate in effect
immediately prior to the Adjustment Date
less the Periodic Rate Cap, if any, and
(ii) the related Minimum Mortgage Rate.
With respect to each Mortgage Loan that
becomes an REO Property, as of any date of
determination, the annual rate
determined in accordance with the
immediately preceding sentence as of the date
such Mortgage Loan became an REO
Property.
"Mortgaged Property": The underlying property securing a
Mortgage Loan, including any REO Property,
consisting of an Estate in Real
Property improved by a Residential
Dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Monthly Excess Cashflow": With respect to any
Distribution Date, the sum of (i) any
Overcollateralization Reduction Amount and
(ii) the excess of (x) the Available
Distribution Amount for such Distribution
Date over (y) the sum for such Distribution
Date of (A) the Senior Interest
Distribution Amount distributable to the
holders of the Class A Certificates and
the Interest Distribution Amount
distributable to the holders of the Mezzanine
Certificates and (B) the Principal
Remittance Amount.
"Net Mortgage Rate": With respect to any Mortgage Loan (or the
related REO Property) as of any date of
determination, a per annum rate of
interest equal to the then applicable
Mortgage Rate for such Mortgage Loan minus
the Servicing Fee Rate.
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<PAGE>
"Net WAC Pass-Through Rate": For any Distribution Date and the
Class A Certificates and the Mezzanine
Certificates, a per annum rate equal to
the product of (x) the weighted average of
the Expense Adjusted Net Mortgage
Rates of the Mortgage Loans, in each case,
weighted on the basis of the
outstanding Stated Principal Balances of
the related Mortgage Loans as of the
first day of the month preceding the month
of such Distribution Date (after
giving effect to scheduled payments of
principal due during the related Due
Period, to the extent received or advanced,
and unscheduled collections of
principal received during the related
Prepayment Period) and (y) a fraction, the
numerator of which is 30 and the
denominator of which is the actual number of
days elapsed in the related Interest
Accrual Period. For federal income tax
purposes, the economic equivalent of such
rate shall be expressed as the
weighted average of the REMIC I Remittance
Rates on the REMIC I Regular
Interests, weighted on the basis of the
Uncertificated Balance of each such
REMIC I Regular Interest.
"Net WAC Rate Carryover Amount": With respect to any Class of
the Class A Certificates and the Mezzanine
Certificates and any Distribution
Date, the sum of (A) the positive excess of
(i) the amount of interest accrued
on such Class of Certificates for such
Distribution Date calculated at the
related Formula Rate for such Distribution
Date over (ii) the amount of interest
accrued on such Class of Certificates at
the related Net WAC Pass-Through Rate
for such Distribution Date and (B) the
related Net WAC Rate Carryover Amount for
the previous Distribution Date not
previously distributed, together with
interest thereon at a rate equal to the
related Formula Rate for such Class of
Certificates for such Distribution
Date.
"Net WAC Rate Carryover Reserve Account": As defined in
Section 3.28.
"New Lease": Any lease of REO Property entered into on behalf
of REMIC I, including any lease renewed or
extended on behalf of REMIC I, if
REMIC I has the right to renegotiate the
terms of such lease.
"Nonrecoverable Advance": Any Advance previously made or
proposed to be made in respect of a
Mortgage Loan or REO Property that, in the
good faith business judgment of the
Servicer, will not or, in the case of a
proposed Advance, would not be ultimately
recoverable from related Late
Collections, Insurance Proceeds or
Liquidation Proceeds on such Mortgage Loan or
REO Property as provided herein.
"Nonrecoverable Servicing Advance": Any Servicing Advance
previously made or proposed to be made in
respect of a Mortgage Loan or REO
Property that, in the good faith business
judgment of the Servicer, will not or,
in the case of a proposed Servicing
Advance, would not be ultimately recoverable
from related Late Collections, Insurance
Proceeds or Liquidation Proceeds on
such Mortgage Loan or REO Property as
provided herein.
"Non-United States Person": Any Person other than a United
States Person.
"Notional Amount": With respect to the Class CE Interest and
any Distribution Date, the aggregate
Uncertificated Balance of the REMIC I
Regular Interests (other than REMIC I
Regular Interest I-LTP) for such
Distribution Date.
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<PAGE>
"Officers' Certificate": A certificate signed by the Chairman
of the Board, the Vice Chairman of the
Board, the President or a vice president
(however denominated), and by the
Treasurer, the Secretary, or one of the
assistant treasurers or assistant
secretaries of the Servicer, the Seller or the
Depositor, as applicable.
"One-Month LIBOR": With respect to the Class A Certificates,
the Mezzanine Certificates and for purposes
of the Marker Rate and Maximum
I-LTZZ Uncertificated Interest Deferral
Amount, REMIC I Remittance Rate for
REMIC I Regular Interest I-LTA1A, REMIC I
Regular Interest I-LTA1B, REMIC I
Regular Interest I-LTAIC, REMIC I Regular
Interest I-LTM1, REMIC I Regular
Interest I-LTM2, REMIC I Regular Interest
I-LTM3, REMIC I Regular Interest
I-LTM4, REMIC I Regular Interest I-LTM5,
REMIC I Regular Interest I-LTM6, REMIC
I Regular Interest I-LTM7, REMIC I Regular
Interest I-LTM8, REMIC I Regular
Interest I-LTM9 and REMIC I Regular
Interest I-LTM10, and any Interest Accrual
Period therefor, the rate determined by the
Trustee on the related Interest
Determination Date on the basis of the
offered rate for one-month U.S. dollar
deposits, as such rate appears on Telerate
Page 3750 as of 11:00 a.m. (London
time) on such Interest Determination Date;
provided that if such rate does not
appear on Telerate Page 3750, the rate for
such date will be determined on the
basis of the offered rates of the Reference
Banks for one-month U.S. dollar
deposits, as of 11:00 a.m. (London time) on
such Interest Determination Date. In
such event, the Trustee will request the
principal London office of each of the
Reference Banks to provide a quotation of
its rate. If on such Interest
Determination Date, two or more Reference
Banks provide such offered quotations,
One-Month LIBOR for the related Interest
Accrual Period shall be the arithmetic
mean of such offered quotations (rounded
upwards if necessary to the nearest
whole multiple of 1/16%). If on such
Interest Determination Date, fewer than two
Reference Banks provide such offered
quotations, One-Month LIBOR for the related
Interest Accrual Period shall be the higher
of (i) LIBOR as determined on the
previous Interest Determination Date and
(ii) the Reserve Interest Rate.
Notwithstanding the foregoing, if, under
the priorities described above, LIBOR
for an Interest Determination Date would be
based on LIBOR for the previous
Interest Determination Date for the third
consecutive Interest Determination
Date, the Trustee, after consultation with
the Depositor, shall select an
alternative comparable index (over which
the Trustee has no control), used for
determining one-month Eurodollar lending
rates that is calculated and published
(or otherwise made available) by an
independent party.
"Opinion of Counsel": A written opinion of counsel, who may,
without limitation, be salaried counsel for
the Depositor or the Servicer,
acceptable to the Trustee, if such opinion
is delivered to the Trustee, except
that any opinion of counsel relating to (a)
the qualification of any Trust REMIC
as a REMIC or (b) compliance with the REMIC
Provisions must be an opinion of
Independent counsel.
"Originator": Option One Mortgage Corporation, or its
successor in interest.
"Overcollateralization Deficiency Amount": With respect to any
Distribution Date, the excess, if any, of
(a) the Overcollateralization Target
Amount applicable to such Distribution Date
over (b) the Overcollateralized
Amount applicable to such Distribution Date
(calculated for this purpose only
after assuming that 100% of the Principal
Remittance Amount on such Distribution
Date has been distributed).
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<PAGE>
"Overcollateralization Increase Amount": With respect to any
Distribution Date, the lesser of (a) the
Overcollateralization Deficiency Amount
as of such Distribution Date (calculated
for this purpose only after assuming
that 100% of the Principal Remittance
Amount on such Distribution Date has been
distributed) and (b) the amount of Accrued
Certificate Interest payable on the
Class CE Certificates on such Distribution
Date as reduced by Realized Losses
allocated thereto with respect to such
Distribution Date pursuant to Section
4.04.
"Overcollateralization Reduction Amount": With respect to any
Distribution Date, an amount equal to the
lesser of (a) the Principal Remittance
Amount on such Distribution Date and (b)
the Excess Overcollateralized Amount.
"Overcollateralization Target Amount": With respect to any
Distribution Date, (i) prior to the
Stepdown Date, an amount equal to 2.70% of
the aggregate outstanding Stated Principal
Balance of the Mortgage Loans as of
the Cut-off Date, (ii) on or after the
Stepdown Date provided a Trigger Event is
not in effect, the greater of (x) 5.40% of
the then current aggregate
outstanding Stated Principal Balance of the
Mortgage Loans as of the last day of
the related Due Period and (y) $4,069,522,
or (iii) on or after the Stepdown
Date and if a Trigger Event is in effect,
the Overcollateralization Target
Amount for the immediately preceding
Distribution Date. Notwithstanding the
foregoing, on and after any Distribution
Date following the reduction of the
aggregate Certificate Principal Balance of
the Class A Certificates and the
Mezzanine Certificates to zero, the
Overcollateralization Target Amount shall be
zero.
"Overcollateralized Amount": With respect to any Distribution
Date, the excess, if any, of (a) the
aggregate Stated Principal Balances of the
Mortgage Loans and REO Properties as of the
last day of the related Due Period
(after giving effect to scheduled payments
of principal due during the related
Due Period, to the extent received or
advanced, and unscheduled collections of
principal received during the related
Prepayment Period) over (b) the sum of the
aggregate Certificate Principal Balance of
the Class A Certificates, the
Mezzanine Certificates and the Class P
Certificates after giving effect to
distributions to be made on such
Distribution Date.
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate,
including any interest in such
Certificate as the Holder thereof and any
other interest therein, whether direct
or indirect, legal or beneficial, as owner
or as pledgee.
"Pass-Through Rate": With respect to the Class A Certificates
and the Mezzanine Certificates and any
Distribution Date, the lesser of (x) the
related Formula Rate for such Distribution
Date and (y) the Net WAC Rate for
such Distribution Date. With respect to the
Class C Interest and any
Distribution Date, (i) a per annum rate
equal to the percentage equivalent of a
fraction, the numerator of which is (x) the
interest on the Uncertificated
Principal Balance of each REMIC I Regular
Interest listed in clause (y) below at
a rate equal to the related REMIC I
Remittance Rate minus the Marker Rate and
the denominator of which is (y) the
aggregate Uncertificated Balance of REMIC I
Regular Interest I-LTA1A, I-LTA1B, I-LTA1C,
I-LTM1, I-LTM2, I-LTM3, I-LTM4,
I-LTM5, I-LTM6, I-LTM7, I-LTM8, I-LTM9,
I-LTM10 and I-LTZZ and (ii) 100% of the
interest on REMIC I Regular Interest I-LTP,
expressed as a per annum rate.
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<PAGE>
With respect to the Class C Certificates, 100% of the interest
distributable to the Class C Interest,
expressed as a per annum rate.
"Percentage Interest": With respect to any Class of
Certificates (other than the Residual
Certificates), the undivided percentage
ownership in such Class evidenced by such
Certificate, expressed as a
percentage, the numerator of which is the
initial Certificate Principal Balance
or Notional Amount represented by such
Certificate and the denominator of which
is the aggregate initial Certificate
Principal Balance or initial Notional
Amount of all of the Certificates of such
Class. The Class A Certificates and
the Mezzanine Certificates are issuable
only in minimum Percentage Interests
corresponding to minimum initial
Certificate Principal Balances of $25,000 and
integral multiples of $1.00 in excess
thereof. The Class P Certificates are
issuable only in Percentage Interests
corresponding to initial Certificate
Principal Balances of $20 and integral
multiples thereof. The Class CE
Certificates are issuable only in minimum
Percentage Interests corresponding to
minimum initial Certificate Principal
Balances of $100,000 and integral
multiples of $1.00 in excess thereof;
provided, however, that a single
Certificate of each such Class of
Certificates may be issued having a Percentage
Interest corresponding to the remainder of
the aggregate initial Certificate
Principal Balance or Notional Amount of
such Class or to an otherwise authorized
denomination for such Class plus such
remainder. With respect to any Residual
Certificate, the undivided percentage
ownership in such Class evidenced by such
Certificate, as set forth on the face of
such Certificate. The Residual
Certificates are issuable in Percentage
Interests of 20% and multiples thereof.
"Periodic Rate Cap": With respect to each Adjustable-Rate
Mortgage Loan and any Adjustment Date
therefor, the fixed percentage set forth
in the related Mortgage Note, which is the
maximum amount by which the Mortgage
Rate for such Mortgage Loan may increase or
decrease (without regard to the
Maximum Mortgage Rate or the Minimum
Mortgage Rate) on such Adjustment Date from
the Mortgage Rate in effect immediately
prior to such Adjustment Date.
"Permitted Investments": Any one or more of the following
obligations or securities acquired at a
purchase price of not greater than par,
regardless of whether issued or managed by
the Depositor, the Servicer, the
Trustee or any of their respective
Affiliates:
(i) direct
obligations of, or obligations fully
guaranteed as to timely payment of principal and interest by,
the
United States or any agency or instrumentality thereof, provided
such
obligations are backed by the full faith and credit of the
United
States;
(ii)
demand and time deposits in, certificates of deposit
of, or bankers' acceptances issued by, any Depository
Institution;
(iii) repurchase obligations
with respect to any security
described in clause (i) above entered into with a Depository
Institution (acting as principal);
(iv)
securities bearing interest or sold at a discount
that are issued by any corporation incorporated under the laws of
the
United States of America or any state thereof and that are rated
by
each Rating Agency that rates such securities in its highest
28
<PAGE>
long-term unsecured rating categories at the time of such
investment or
contractual commitment providing for such investment;
(v) commercial
paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on
demand
or on a specified date not more than 30 days after the date of
acquisition thereof) that is rated by each Rating Agency that
rates
such securities in its highest short-term unsecured debt rating
available at the time of such investment;
(vi)
units of money market funds, including those managed
or advised by the Trustee or its Affiliates, that have been rated
"AAA"
by Fitch (if
rated by Fitch) and "AAAm" or "AAAm-G" by S&P or "Aaa" by
Moody's; and
(viii) if
previously confirmed in writing to the Trustee,
any other demand, money market or time deposit, or any other
obligation, security or investment, as may be acceptable to the
Rating
Agencies as a permitted investment of funds backing securities
having
ratings equivalent to its highest initial rating of the Class A
Certificates;
provided, however, that no instrument
described hereunder shall evidence either
the right to receive (a) only interest with
respect to the obligations
underlying such instrument or (b) both
principal and interest payments derived
from obligations underlying such instrument
and the interest and principal
payments with respect to such instrument
provide a yield to maturity at par
greater than 120% of the yield to maturity
at par of the underlying obligations.
"Permitted Transferee": Any Transferee of a Residual
Certificate other than a Disqualified
Organization or Non-United States Person.
"Person": Any individual, corporation, partnership, limited
liability company, joint venture,
association, joint-stock company, trust,
unincorporated organization or government
or any agency or political subdivision
thereof.
"Plan": Any employee benefit plan or certain other retirement
plans and arrangements, including
individual retirement accounts and annuities,
Keogh plans and bank collective investment
funds and insurance company general
or separate accounts in which such plans,
accounts or arrangements are invested,
that are subject to ERISA or Section 4975
of the Code.
"Prepayment Assumption": As defined in the Prospectus
Supplement.
"Prepayment Charge": With respect to any Prepayment Period,
any prepayment premium, penalty or charge
payable by a Mortgagor in connection
with any Principal Prepayment on a Mortgage
Loan pursuant to the terms of the
related Mortgage Note (other than any
Servicer Prepayment Charge Payment
Amount).
"Prepayment Charge Schedule": As of any date, the list of
Prepayment Charges included in the Trust
Fund on such date, attached hereto as
Schedule 2 (including the prepayment
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<PAGE>
charge summary attached thereto). The
Prepayment Charge Schedule shall set forth
the following information with respect to
each Prepayment Charge:
(i) the
Mortgage Loan identifying number;
(ii)
a code indicating the type of Prepayment Charge;
(iii) the
date on which the first Monthly Payment was due
on the related Mortgage Loan;
(iv)
the term of the related Prepayment Charge;
(v) the
original Stated Principal Balance of the related
Mortgage Loan; and
(vi)
the Stated Principal Balance of the related Mortgage
Loan as of the Cut-off Date.
"Prepayment Interest Excess": With respect to any Distribution
Date, for each Mortgage Loan that was the
subject of a Principal Prepayment in
full during the portion of the related
Prepayment Period occurring between the
first day and the Determination Date of the
calendar month in which such
Distribution Date occurs, an amount equal
to interest (to the extent received)
at the applicable Net Mortgage Rate on the
amount of such Principal Prepayment
for the number of days commencing on the
first day of the calendar month in
which such Distribution Date occurs and
ending on the date on which such
prepayment is so applied.
"Prepayment Interest Shortfall": With respect to any
Distribution Date, for each Mortgage Loan
that was the subject of a Principal
Prepayment in full during the portion of
the related Prepayment Period occurring
between the first day of the related
Prepayment Period and the last day of the
calendar month preceding the month in which
such Distribution Date occurs, an
amount equal to interest at the applicable
Net Mortgage Rate on the amount of
such Principal Prepayment for the number of
days commencing on the date on which
the prepayment is applied and ending on the
last day of the calendar month
preceding the month in which such
Distribution Date occurs. The obligations of
the Master Servicer in respect of any
Prepayment Interest Shortfall are set
forth in Section 3.24.
"Prepayment Period": With respect to any Distribution Date,
the period commencing on the day after the
Determination Date in the calendar
month preceding the calendar month in which
such Distribution Date occurs (or,
in the case of the first Distribution Date,
commencing on February 1, 2005) and
ending on the Determination Date of the
calendar month in which such
Distribution Date occurs.
"Principal Distribution Amount": With respect to any
Distribution Date, the sum of (i) the
principal portion of each Monthly Payment
on the due during the related Due Period,
whether or not received on or prior to
the related Determination Date; (ii) the
Stated Principal Balance of any
Mortgage Loan that was purchased during the
related Prepayment Period pursuant
to or as contemplated by Section 2.03,
Section 3.16(c) or Section 9.01 and the
amount of any shortfall deposited in the
Collection Account in connection with
the substitution of a
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<PAGE>
Deleted Mortgage Loan pursuant to Section
2.03 during the related Prepayment
Period; (iii) the principal portion of all
other unscheduled collections
(including, without limitation, Principal
Prepayments, Insurance Proceeds,
Liquidation Proceeds, Subsequent Recoveries
and REO Principal Amortization)
received on the Mortgage Loans during the
related Prepayment Period, net of any
portion thereof that represents a recovery
of principal for which an Advance was
made by the Servicer pursuant to Section
4.03 in respect of a preceding
Distribution Date and (iv) any
Overcollateralization Increase Amount for such
Distribution Date minus (v) any
Overcollateralization Reduction Amount for such
Distribution Date. In no event will the
Principal Distribution Amount with
respect to any Distribution Date be (x)
less than zero or (y) greater than the
then outstanding aggregate Certificate
Principal Balance of the Class A
Certificates and the Mezzanine
Certificates.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is
received in advance of its scheduled Due
Date and which is not accompanied by an
amount of interest representing the full
amount of scheduled interest due on any Due
Date in any month or months
subsequent to the month of prepayment.
"Principal Remittance Amount": For any Distribution Date, that
portion of the Available Distribution
Amount equal to the sum of the amounts set
forth in (i) through (iv) of the definition
of Principal Distribution Amount.
"Private Certificates": As defined in Section 5.02(b).
"Prospectus Supplement": The Prospectus Supplement, dated
February 4, 2005, relating to the public
offering of the Class A Certificates
and the Mezzanine Certificates (other than
the Class M-9 Certificates and the
Class M-10 Certificates).
"PTCE": A Prohibited Transaction Class Exemption issued by the
United States Department of Labor which
provides that exemptive relief is
available to any party to any transaction
which satisfies the conditions of the
exemption.
"Purchase Price": With respect to any Mortgage Loan or REO
Property to be purchased pursuant to or as
contemplated by Section 2.03, Section
3.16(c) or Section 9.01, and as confirmed
by a certification from a Servicing
Officer to the Trustee, an amount equal to
the sum of (i) 100% of the Stated
Principal Balance thereof as of the date of
purchase (or such other price as
provided in Section 9.01), (ii) in the case
of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance
at the applicable Net Mortgage Rate in
effect from time to time from the Due Date
as to which interest was last covered
by a payment by the Mortgagor or an Advance
by the Servicer, which payment or
Advance had as of the date of purchase been
distributed pursuant to Section
4.01, through the end of the calendar month
in which the purchase is to be
effected plus and (y) an REO Property, the
sum of (1) accrued interest on such
Stated Principal Balance at the applicable
Net Mortgage Rate in effect from time
to time from the Due Date as to which
interest was last covered by a payment by
the Mortgagor or an Advance by the Servicer
through the end of the calendar
month immediately preceding the calendar
month in which such REO Property was
acquired, plus (2) REO Imputed Interest for
such REO Property for each calendar
month commencing with the calendar month in
which such
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REO Property was acquired and ending with
the calendar month in which such
purchase is to be effected, net of the
total of all net rental income, Insurance
Proceeds, Liquidation Proceeds and Advances
that as of the date of purchase had
been distributed as or to cover REO Imputed
Interest pursuant to Section 4.01,
(iii) any unreimbursed Servicing Advances
and Advances (including Nonrecoverable
Advances and Nonrecoverable Servicing
Advances) and any unpaid Servicing Fees
allocable to such Mortgage Loan or REO
Property, (iv) any amounts previously
withdrawn from the Collection Account in
respect of such Mortgage Loan or REO
Property pursuant to Section 3.11(a)(ix)
and Section 3.16(b), and (v) in the
case of a Mortgage Loan required to be
purchased pursuant to Section 2.03,
expenses reasonably incurred or to be
incurred by the Servicer or the Trustee in
respect of the breach or defect giving rise
to the purchase obligation including
any costs and damages incurred by the Trust
Fund in connection with any
violation by such loan of any predatory or
abusive lending law.
"Qualified
Substitute Mortgage Loan": A mortgage loan
substituted for a Deleted Mortgage Loan
pursuant to the terms of this Agreement
which must, on the date of such
substitution, (i) have an outstanding Stated
Principal Balance, after application of all
scheduled payments of principal and
interest due during or prior to the month
of substitution, not in excess of the
Stated Principal Balance of the Deleted
Mortgage Loan as of the Due Date in the
calendar month during which the
substitution occurs, (ii) have a Mortgage Rate
not less than (and not more than one
percentage point in excess of) the Mortgage
Rate of the Deleted Mortgage Loan, (iii)
with respect to any Adjustable-Rate
Mortgage Loan, have a Maximum Mortgage Rate
not less than the Maximum Mortgage
Rate on the Deleted Mortgage Loan, (iv)
with respect to any Adjustable-Rate
Mortgage Loan, have a Minimum Mortgage Rate
not less than the Minimum Mortgage
Rate of the Deleted Mortgage Loan, (v) with
respect to any Adjustable-Rate
Mortgage Loan, have a Gross Margin equal to
the Gross Margin of the Deleted
Mortgage Loan, (vi) with respect to any
Adjustable-Rate Mortgage Loan, have a
next Adjustment Date not more than two
months later than the next Adjustment
Date on the Deleted Mortgage Loan, (vii)
have a remaining term to maturity not
greater than (and not more than one year
less than) that of the Deleted Mortgage
Loan, (viii) have the same Due Date as the
Due Date on the Deleted Mortgage
Loan, (ix) have a Loan-to-Value Ratio as of
the date of substitution equal to or
lower than the Loan-to-Value Ratio of the
Deleted Mortgage Loan as of such date,
(x) have a risk grading determined by the
Originator at least equal to the risk
grading assigned on the Deleted Mortgage
Loan and (xi) conform to each
representation and warranty set forth in
Section 6 of the Mortgage Loan Purchase
Agreement applicable to the Deleted
Mortgage Loan. In the event that one or more
mortgage loans are substituted for one or
more Deleted Mortgage Loans, the
amounts described in clause (i) hereof
shall be determined on the basis of
aggregate principal balances, the Mortgage
Rates described in clause (ii) hereof
shall be determined on the basis of
weighted average Mortgage Rates, the terms
described in clause (vii) hereof shall be
determined on the basis of weighted
average remaining term to maturity, the
Loan-to-Value Ratios described in clause
(ix) hereof shall be satisfied as to each
such mortgage loan, the risk gradings
described in clause (x) hereof shall be
satisfied as to each such mortgage loan
and, except to the extent otherwise
provided in this sentence, the
representations and warranties described in
clause (xi) hereof must be satisfied
as to each Qualified Substitute Mortgage
Loan or in the aggregate, as the case
may be.
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"Rate/Term Refinancing": A Refinanced Mortgage Loan, the
proceeds of which are not more than a
nominal amount in excess of the existing
first mortgage loan and any subordinate
mortgage loan on the related Mortgaged
Property and related closing costs, and
were used exclusively (except for such
nominal amount) to satisfy the then
existing first mortgage loan and any
subordinate mortgage loan of the Mortgagor
on the related Mortgaged Property and
to pay related closing costs.
"Rating Agency or Rating Agencies": Fitch, Moody's and S&P
or
their successors. If such agencies or their
successors are no longer in
existence, "Rating Agencies" shall be such
nationally recognized statistical
rating agencies, or other comparable
Persons, designated by the Depositor,
notice of which designation shall be given
to the Trustee and the Servicer.
"Realized Loss": With respect to each Mortgage Loan as to
which a Final Recovery Determination has
been made, an amount (not less than
zero) equal to (i) the unpaid principal
balance of such Mortgage Loan as of the
commencement of the calendar month in which
the Final Recovery Determination was
made, plus (ii) accrued interest from the
Due Date as to which interest was last
paid by the Mortgagor through the end of
the calendar month in which such Final
Recovery Determination was made, calculated
in the case of each calendar month
during such period (A) at an annual rate
equal to the annual rate at which
interest was then accruing on such Mortgage
Loan and (B) on a principal amount
equal to the Stated Principal Balance of
such Mortgage Loan as of the close of
business on the Distribution Date during
such calendar month, plus (iii) any
amounts previously withdrawn from the
Collection Account in respect of such
Mortgage Loan pursuant to Section
3.11(a)(ix) and Section 3.16(b), minus (iv)
the proceeds, if any, received in respect
of such Mortgage Loan during the
calendar month in which such Final Recovery
Determination was made, net of
amounts that are payable therefrom to the
Servicer with respect to such Mortgage
Loan pursuant to Section 3.11(a)(iii).
With respect to any REO Property as to which a Final Recovery
Determination has been made, an amount (not
less than zero) equal to (i) the
unpaid principal balance of the related
Mortgage Loan as of the date of
acquisition of such REO Property on behalf
of REMIC I, plus (ii) accrued
interest from the Due Date as to which
interest was last paid by the Mortgagor
in respect of the related Mortgage Loan
through the end of the calendar month
immediately preceding the calendar month in
which such REO Property was
acquired, calculated in the case of each
calendar month during such period (A)
at an annual rate equal to the annual rate
at which interest was then accruing
on the related Mortgage Loan and (B) on a
principal amount equal to the Stated
Principal Balance of the related Mortgage
Loan as of the close of business on
the Distribution Date during such calendar
month, plus (iii) REO Imputed
Interest for such REO Property for each
calendar month commencing with the
calendar month in which such REO Property
was acquired and ending with the
calendar month in which such Final Recovery
Determination was made, plus (iv)
any amounts previously withdrawn from the
Collection Account in respect of the
related Mortgage Loan pursuant to Section
3.11(a)(ix) and Section 3.16(b), minus
(v) the aggregate of all Advances and
Servicing Advances (in the case of
Servicing Advances, without duplication of
amounts netted out of the rental
income, Insurance Proceeds and Liquidation
Proceeds described in clause (vi)
below) made by the Servicer in respect of
such REO Property or the related
Mortgage Loan for which the Servicer has
been or,
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in connection with such Final Recovery
Determination, will be reimbursed
pursuant to Section 3.23 out of rental
income, Insurance Proceeds and
Liquidation Proceeds received in respect of
such REO Property, minus (vi) the
total of all net rental income, Insurance
Proceeds and Liquidation Proceeds
received in respect of such REO Property
that has been, or in connection with
such Final Recovery Determination, will be
transferred to the Distribution
Account pursuant to Section 3.23.
With respect to each Mortgage Loan which has become the
subject of a Deficient Valuation, the
difference between the principal balance
of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation
and the principal balance of the Mortgage
Loan as reduced by the Deficient
Valuation.
With respect to each Mortgage Loan which has become the
subject of a Debt Service Reduction, the
portion, if any, of the reduction in
each affected Monthly Payment attributable
to a reduction in the Mortgage Rate
imposed by a court of competent
jurisdiction. Each such Realized Loss shall be
deemed to have been incurred on the Due
Date for each affected Monthly Payment.
If the Servicer receives Subsequent Recoveries with respect to
any Mortgage Loan, the amount of the
Realized Loss with respect to that Mortgage
Loan will be reduced to the extent such
recoveries are applied to principal
distributions on any Distribution Date.
"Record Date": With respect to each Distribution Date and any
Book-Entry Certificate, the Business Day
immediately preceding such Distribution
Date. With respect to each Distribution
Date and any other Certificates,
including any Definitive Certificates, the
last Business Day of the month
immediately preceding the month in which
such Distribution Date occurs.
"Reference Banks": Deutsche Bank AG, Barclays' Bank PLC, The
Tokyo Mitsubishi Bank and National
Westminster Bank PLC and their successors in
interest; provided, however, that if any of
the foregoing banks are not suitable
to serve as a Reference Bank, then any
leading banks selected by the Trustee,
after consultation with the Depositor,
which are engaged in transactions in
Eurodollar deposits in the international
Eurocurrency market (i) with an
established place of business in London and
(ii) not controlling, under the
control of or under common control with the
Depositor or any Affiliate thereof.
"Refinanced Mortgage Loan": A Mortgage Loan the proceeds of
which were not used to purchase the related
Mortgaged Property.
"Regular Certificate": Any Class A Certificate, Mezzanine
Certificate, Class CE Certificate or Class
P Certificate.
"Regular Interest": A "regular interest" in a REMIC within the
meaning of Section 860G(a)(1) of the
Code.
"Relief Act": The Servicemembers Civil Relief Act.
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<PAGE>
"Relief Act Interest Shortfall": With respect to any
Distribution Date and any Mortgage Loan,
any reduction in the amount of interest
collectible on such Mortgage Loan for the
most recently ended calendar month as
a result of the application of the Relief
Act.
"REMIC": A "real estate mortgage investment conduit" within
the meaning of Section 860D of the
Code.
"REMIC I": The segregated pool of assets subject hereto,
constituting the primary trust created
hereby and to be administered hereunder,
with respect to which a REMIC election is
to be made, consisting of: (i) such
Mortgage Loans and Prepayment Charges
related thereto as from time to time are
subject to this Agreement, together with
the Mortgage Files relating thereto,
and together with all collections thereon
and proceeds thereof; (ii) any REO
Property, together with all collections
thereon and proceeds thereof; (iii) the
Trustee's rights with respect to the
Mortgage Loans under all insurance policies
required to be maintained pursuant to this
Agreement and any proceeds thereof;
(iv) the Depositor's rights under the
Mortgage Loan Purchase Agreement
(including any security interest created
thereby); and (v) the Collection
Account (other than any amounts
representing any Servicer Prepayment Charge
Payment Amount), the Distribution Account
(other than any amounts representing
any Servicer Prepayment Charge Payment
Amount) and any REO Account, and such
assets that are deposited therein from time
to time and any investments thereof,
together with any and all income, proceeds
and payments with respect thereto.
Notwithstanding the foregoing, however,
REMIC I specifically excludes all
payments and other collections of principal
and interest due on the Mortgage
Loans on or before the Cut-off Date, all
Prepayment Charges payable in
connection with Principal Prepayments on
the Mortgage Loans made before the
Cut-off Date, the Net WAC Rate Carryover
Reserve Account and the Cap Contracts.
"REMIC I Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to (a)
the product of (i) the aggregate
Stated Principal Balance of the Mortgage
Loans and REO Properties then
outstanding and (ii) the REMIC I Remittance
Rate for REMIC I Regular Interest
I-LTAA minus the Marker Rate, divided by
(b) 12.
"REMIC I Overcollateralized Amount": With respect to any date
of determination, (i) 1% of the aggregate
Uncertificated Balance of the REMIC I
Regular Interests minus (ii) the aggregate
Uncertificated Balance of REMIC I
Regular Interest I-LTA1A, REMIC I Regular
Interest I-LTA1B, REMIC I Regular
Interest I-LTA1C, REMIC I Regular Interest
I-LTM1, REMIC I Regular Interest
I-LTM2, REMIC I Regular Interest I-LTM3,
REMIC I Regular Interest I-LTM4, REMIC
I Regular Interest I-LTM5, REMIC I Regular
Interest I-LTM6, REMIC I Regular
Interest I-LTM7, REMIC I Regular Interest
I-LTM8, REMIC I Regular Interest
I-LTM9, REMIC I Regular Interest I-LTM10
and REMIC I Regular Interest I-LTP, in
each case as of such date of
determination.
"REMIC I Principal Loss Allocation Amount": With respect to
any Distribution Date, an amount equal to
the product of (i) the aggregate
Stated Principal Balance of the Mortgage
Loans and REO Properties then
outstanding and (ii) 1 minus a fraction,
the numerator of which is two times the
aggregate Uncertificated Balance of REMIC I
Regular Interest I-LTA1A, REMIC I
Regular Interest I-LTA1B, REMIC I Regular
Interest I-LTA1C, REMIC I
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Regular Interest I-LTM1, REMIC I Regular
Interest I-LTM2, REMIC I Regular
Interest I-LTM3, REMIC I Regular Interest
I-LTM4, REMIC I Regular Interest
I-LTM5, REMIC I Regular Interest I-LTM6,
REMIC I Regular Interest I-LTM7, REMIC
I Regular Interest I-LTM8, REMIC I Regular
Interest I-LTM9 and REMIC I Regular
Interest I-LTM10, and the denominator of
which is the aggregate Uncertificated
Balance of REMIC I Regular Interest
I-LTA1A, REMIC I Regular Interest I-LTA1B,
REMIC I Regular Interest I-LTA1C, REMIC I
Regular Interest I-LTM1, REMIC I
Regular Interest I-LTM2, REMIC I Regular
Interest I-LTM3, REMIC I Regular
Interest I-LTM4, REMIC I Regular Interest
I-LTM5, REMIC I Regular Interest
I-LTM6, REMIC I Regular Interest I-LTM7,
REMIC I Regular Interest I-LTM8, REMIC
I Regular Interest I-LTM9, REMIC I Regular
Interest I-LTM10 and REMIC I Regular
Interest I-LTZZ.
"REMIC I Regular Interest": Any of the separate
non-certificated beneficial ownership
interests in REMIC I issued hereunder and
designated as a "regular interest" in REMIC
I. Each REMIC I Regular Interest
shall accrue interest at the related REMIC
I Remittance Rate in effect from time
to time or shall otherwise be entitled to
interest as set forth herein, and
shall be entitled to distributions of
principal, subject to the terms and
conditions hereof, in an aggregate amount
equal to its initial Uncertificated
Balance as set forth in the Preliminary
Statement hereto. The EMIC I Regular
Interests are as follows: REMIC I Regular
Interest I-LTAA, REMIC I Regular
Interest I-LTA1A, REMIC I Regular Interest
I-LTA1B, REMIC I Regular Interest
I-LTA1C, REMIC I Regular Interest I-LTM1,
REMIC I Regular Interest I-LTM2, REMIC
I Regular Interest I-LTM3, REMIC I Regular
Interest I-LTM4, REMIC I Regular
Interest I-LTM5, REMIC I Regular Interest
I-LTM6, REMIC I Regular Interest
I-LTM7, REMIC I Regular Interest I-LTM8,
REMIC I Regular Interest I-LTM9, REMIC
I Regular Interest I-LTM10, REMIC I Regular
Interest I-LTZZ and REMIC I Regular
Interest I-LTP.
"REMIC I Remittance Rate": With respect to any Distribution
Date and each REMIC I Regular Interest, the
Net WAC Pass-Through Rate.
"REMIC I Required Overcollateralized Amount": 1% of the
Overcollateralization Target Amount.
"REMIC II": The segregated pool of assets consisting of all of
the REMIC I Regular Interests conveyed in
trust to the Trustee, for the benefit
of the Class A Certificates, the Mezzanine
Certificates, the Class CE Interest,
the Class P Interest and the Class R-II
Interest and all amounts deposited
therein, with respect to which a separate
REMIC election is to be made.
"REMIC III": The segregated pool of assets consisting of all
of the Class CE Interest conveyed in trust
to the Trustee, for the benefit of
the Class CE Certificates, and the Class
R-III Interest and all amounts
deposited therein, with respect to which a
separate REMIC election is to be
made.
"REMIC IV": The
segregated pool of assets consisting of all of
the Class P Interest conveyed in trust to
the Trustee, for the benefit of the
Class P Certificates, and the Class
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R-IV Interest and all amounts deposited
therein, with respect to which a
separate REMIC election is to be made.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment
conduits, which appear at Section
860A through 860G of the Code, and related
provisions, and proposed, temporary
and final regulations and published
rulings, notices and announcements
promulgated thereunder, as the foregoing
may be in effect from time to time.
"REMIC Regular Interests": The REMIC I Regular Interests, the
Class C Interest and the Class P
Interest.
"Remittance Report": A report in form and substance mutually
acceptable to the Servicer and the Trustee
on an electronic data file or tape
prepared by the Servicer pursuant to
Section 4.03 with such additions, deletions
and modifications as agreed to by the
Trustee and the Servicer.
"Rents from Real Property": With respect to any REO Property,
gross income of the character described in
Section 856(d) of the Code as being
included in the term "rents from real
property."
"REO Account": The account or accounts maintained, or caused
to be maintained, by the Servicer in
respect of an REO Property pursuant to
Section 3.23.
"REO Disposition": The sale or other disposition of an REO
Property on behalf of REMIC I.
"REO Imputed Interest": As to any REO Property, for any
calendar month during which such REO
Property was at any time part of REMIC I,
one month's interest at the applicable Net
Mortgage Rate on the Stated Principal
Balance of such REO Property (or, in the
case of the first such calendar month,
of the related Mortgage Loan, if
appropriate) as of the close of business on the
Distribution Date in such calendar
month.
"REO Property": A Mortgaged Property acquired by the Servicer
on behalf of REMIC I through foreclosure or
deed-in-lieu of foreclosure, as
described in Section 3.23.
"Request for Release": A release signed by a Servicing
Officer, in the form of Exhibit E attached
hereto.
"Reserve Interest Rate": With respect to any Interest
Determination Date, the rate per annum that
the Trustee determines to be either
(i) the arithmetic mean (rounded upwards if
necessary to the nearest whole
multiple of 1/16%) of the one-month U.S.
dollar lending rates which New York
City banks selected by the Trustee, after
consultation with the Depositor, are
quoting on the relevant Interest
Determination Date to the principal London
offices of leading banks in the London
interbank market or (ii) in the event
that the Trustee can determine no such
arithmetic mean, the lowest one-month
U.S. dollar lending rate which New York
City banks
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<PAGE>
selected by the Trustee, after consultation
with the Depositor, are quoting on
such Interest Determination Date to leading
European banks.
"Residential Dwelling": Any one of the following: (i) an
attached, detached or semi-detached
one-family dwelling, (ii) an attached,
detached or semi-detached two-to
four-family dwelling, (iii) a one-family
dwelling unit in a Fannie Mae eligible
condominium project, or (iv) a
manufactured home, (v) an attached,
detached or semi-detached one-family
dwelling in a planned unit development,
none of which is a co-operative or
mobile home (as defined in 42 United States
Code, Section 5402(6)).
"Residual Certificates": The Class R Certificates and the
Class R-X Certificates.
"Residual Interest": The sole class of "residual interests" in
a REMIC within the meaning of Section
860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee,
any vice president, managing director,
director, any assistant vice president,
the Secretary, any assistant secretary, the
Treasurer, any assistant treasurer,
any associate, any trust officer or
assistant trust officer or any other officer
of the Trustee having direct responsibility
over this Agreement or otherwise
engaged in performing functions similar to
those performed by any of the above
designated officers and, with respect to a
particular matter, to whom such
matter is referred because of such
officer's knowledge of and familiarity with
the particular subject.
"S&P": Standard & Poor's Ratings Services, a division of
the
McGraw-Hill Companies, Inc., or its
successor in interest.
"Seller": Citigroup Global Markets Realty Corp., or its
successor in interest, in its capacity as
seller under the Mortgage Loan
Purchase Agreement.
"Senior Interest Distribution Amount": With respect to any
Distribution Date, an amount equal to the
sum of (i) the Interest Distribution
Amount for such Distribution Date for the
Class A Certificates and (ii) the
Interest Carry Forward Amount, if any, for
such Distribution Date for the Class
A Certificates.
"Senior Principal Distribution Amount": With respect to any
Distribution Date, the excess of (x) the
aggregate Certificate Principal Balance
of the Class A Certificates immediately
prior to such Distribution Date over (y)
the lesser of (A) the product of (i)
approximately 59.90% and (ii) the aggregate
Stated Principal Balance of the Mortgage
Loans as of the last day of the related
Due Period (after giving effect to
scheduled payments of principal due during
the related Due Period, to the extent
received or advanced, and unscheduled
collections of principal received during
the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day
of the related Due Period (after giving
effect to scheduled payments of
principal due during the related Due
Period, to the extent received or advanced,
and unscheduled collections of principal
received during the related Prepayment
Period) minus $4,069,522.
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<PAGE>
"Servicer": Option One Mortgage Corporation or any successor
servicer appointed as herein provided, in
its capacity as Servicer hereunder.
"Servicer Event of Default": One or more of the events
described in Section 7.01.
"Servicer Prepayment Charge Payment Amount": The amounts
payable by the Servicer in respect of any
waived Prepayment Charges pursuant to
Section 3.01.
"Servicer Remittance Date": With respect to any Distribution
Date, by 1:00 p.m. New York time on the
Business Day preceding the related
Distribution Date.
"Servicing Account": The account or accounts created and
maintained pursuant to Section 3.09.
"Servicing Advances": The reasonable "out-of-pocket" costs and
expenses incurred by the Servicer in
connection with a default, delinquency or
other unanticipated event by the Servicer
in the performance of its servicing
obligations, including, but not limited to,
the cost of (i) the preservation,
inspection, restoration and protection of a
Mortgaged Property, (ii) any
enforcement or judicial proceedings,
including but not limited to foreclosures,
in respect of a particular Mortgage Loan,
(iii) the management (including
reasonable fees in connection therewith)
and liquidation of any REO Property and
(iv) the performance of its obligations
under Section 3.01, Section 3.09,
Section 3.14, Section 3.16 and Section
3.23. The Servicer shall not be required
to make any Nonrecoverable Servicing
Advances.
"Servicing Fee": With respect to each Mortgage Loan and for
any calendar month, an amount equal to the
Servicing Fee Rate accrued for one
month (or in the event of any payment of
interest which accompanies a Principal
Prepayment in full or in part made by the
Mortgagor during such calendar month,
interest for the number of days covered by
such payment of interest) on the same
principal amount on which interest on such
Mortgage Loan accrues for such
calendar month, calculated on the basis of
a 360-day year consisting of twelve
30-day months. A portion of such Servicing
Fee may be retained by any
Sub-Servicer as its servicing
compensation.
"Servicing Fee Rate": 0.30% per annum for the 1st through 10th
Due Periods, 0.40% per annum for the 11th
through 30th Due Periods and 0.65% per
annum for all Due Periods thereafter.
"Servicing Officer": Any authorized representative of the
Servicer involved in, or responsible for,
the administration and servicing of
Mortgage Loans, whose name and specimen
signature appear on a list of Servicing
Officers furnished by the Servicer to the
Trustee and the Depositor on the
Closing Date, as such list may from time to
time be amended.
"Servicing Standard": Shall mean the standards set forth in
Section 3.01.
"Servicing Transfer Costs": Shall mean all reasonable costs
and expenses incurred by the Trustee in
connection with the transfer of
servicing from a predecessor servicer,
including, without limitation, any
reasonable costs or expenses associated
with the complete transfer of all
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servicing data and the completion,
correction or manipulation of such servicing
data as may be required by the Trustee to
correct any errors or insufficiencies
in the servicing data or otherwise to
enable the Trustee (or any successor
servicer appointed pursuant to Section
7.02) to service the Mortgage Loans
properly and effectively.
"Single Certificate": With respect to any Class of
Certificates (other than the Class P
Certificates and the Residual
Certificates), a hypothetical Certificate
of such Class evidencing a Percentage
Interest for such Class corresponding to an
initial Certificate Principal
Balance of $1,000. With respect to the
Class P Certificates and the Residual
Certificates, a hypothetical Certificate of
such Class evidencing a 100%
Percentage Interest in such Class.
"Startup Day": With respect to each Trust REMIC, the day
designated as such pursuant to Section
10.01(b) hereof.
"Stated Principal Balance": With respect to any Mortgage Loan:
(a) as of any date of determination up to
but not including the Distribution
Date on which the proceeds, if any, of a
Liquidation Event with respect to such
Mortgage Loan would be distributed, the
principal balance of such Mortgage Loan
as of the Cut-off Date, as shown in the
Mortgage Loan Schedule, minus the sum of
(i) the principal portion of each Monthly
Payment due on a Due Date subsequent
to the Cut-off Date, to the extent received
from the Mortgagor or advanced by
the Servicer and distributed pursuant to
Section 4.01 on or before such date of
determination, (ii) all Principal
Prepayments received after the Cut-off Date,
to the extent distributed pursuant to
Section 4.01 on or before such date of
determination, (iii) all Liquidation
Proceeds and Insurance Proceeds applied by
the Servicer as recoveries of principal in
accordance with the provisions of
Section 3.16, to the extent distributed
pursuant to Section 4.01 on or before
such date of determination, and (iv) any
Realized Loss incurred with respect
thereto as a result of a Deficient
Valuation made during or prior to the
Prepayment Period for the most recent
Distribution Date coinciding with or
preceding such date of determination; and
(b) as of any date of determination
coinciding with or subsequent to the
Distribution Date on which the proceeds, if
any, of a Liquidation Event with respect to
such Mortgage Loan would be
distributed, zero. With respect to any REO
Property: (a) as of any date of
determination up to but not including the
Distribution Date on which the
proceeds, if any, of a Liquidation Event
with respect to such REO Property would
be distributed, an amount (not less than
zero) equal to the Stated Principal
Balance of the related Mortgage Loan as of
the date on which such REO Property
was acquired on behalf of REMIC I, minus if
such REO Property was acquired
before the Distribution Date in any
calendar month, the principal portion of the
Monthly Payment due on the Due Date in the
calendar month of acquisition, to the
extent advanced by the Servicer and
distributed pursuant to Section 4.01 on or
before such date of determination, and (b)
as of any date of determination
coinciding with or subsequent to the
Distribution Date on which the proceeds, if
any, of a Liquidation Event with respect to
such REO Property would be
distributed, zero.
"Stepdown Date": The earlier to occur of (i) the Distribution
Date on which the aggregate Certificate
Principal Balance of the Class A
Certificates has been reduced to zero and
(ii) the later to occur of (a) the
Distribution Date occurring in March 2008
and (b) the first Distribution Date on
which the Credit Enhancement Percentage
(calculated for this purpose only prior
to any distribution of the Principal
Distribution Amount to the Certificates
then entitled to
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distributions of principal on such
Distribution Date) is equal to or greater
than approximately 40.10%.
"Sub-Servicer": Any Person with which the Servicer has entered
into a Sub-Servicing Agreement and which
meets the qualifications of a
Sub-Servicer pursuant to Section 3.02.
"Sub-Servicing Agreement": The written contract between the
Servicer and a Sub-Servicer relating to
servicing and administration of certain
Mortgage Loans as provided in Section
3.02.
"Subsequent Recoveries": As of any Distribution Date, amounts
received by the Servicer (net of any
related expenses permitted to be reimbursed
pursuant to Section 3.11) specifically
related to a Mortgage Loan that was the
subject of a liquidation or an REO
Disposition prior to the related Prepayment
Period that resulted in a Realized
Loss.
"Substitution Shortfall Amount": As defined in Section
2.03(b).
"Tax Returns": The federal income tax return on Internal
Revenue Service Form 1066, U.S. Real Estate
Mortgage Investment Conduit Income
Tax Return, including Schedule Q thereto,
Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss
Allocation, or any successor forms,
to be filed on behalf of the Trust Fund due
to the classification of portions
thereof as REMICs under the REMIC
Provisions, together with any and all other
information reports or returns that may be
required to be furnished to the
Certificateholders or filed with the
Internal Revenue Service or any other
governmental taxing authority under any
applicable provisions of federal, state
or local tax laws.
"Telerate Page 3750": The display designated as page "3750" on
the Dow Jones Telerate Capital Markets
Report (or such other page as may replace
page 3750 on that report for the purpose of
displaying London interbank offered
rates of major banks).
"Termination Price": As defined in Section 9.01.
"Terminator": As defined in Section 9.01.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment
of any Ownership Interest in a
Certificate.
"Transferee": Any Person who is acquiring by Transfer any
Ownership Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.
"Trigger Event": A Trigger Event is in effect on any
Distribution Date on or after the Stepdown
Date if:
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(a) the
Delinquency Percentage exceeds 40.00% of the then
current Credit Enhancement Percentage;
or
(b) the
aggregate amount of Realized Losses incurred
since the Cut-off Date through the last day
of the related Due Period (reduced
by the aggregate amount of Subsequent
Recoveries received since the Cut-off Date
through the last day of the related Due
Period) divided by aggregate Stated
Principal Balance of the Mortgage Loans as
of the Cut-off Date exceeds the
applicable percentages set forth below with
respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN
PERCENTAGE
------------------------------
----------
March 2008 through February 2009
2.75%
March 2009 through February 2010
4.50%
March 2010 through February 2011
5.50%
March 2011 and thereafter
6.25%
"Trust Fund": Collectively, all of the assets of each Trust
REMIC, the Net WAC Rate Carryover Reserve
Account, the Cap Contracts and the
other assets conveyed by the Depositor to
the Trustee pursuant to Section 2.01.
"Trust REMIC": Any of REMIC I, REMIC II, REMIC III and REMIC
IV.
"Trustee": Deutsche Bank National Trust Company, a national
banking association, or its successor in
interest, or any successor trustee
appointed as herein provided.
"Trustee Fee": The amount payable to the Trustee on each
Distribution Date pursuant to Section 8.05
as compensation for all services
rendered by it in the execution of the
trust hereby created and in the exercise
and performance of any of the powers and
duties of the Trustee hereunder, which
amount shall equal the Trustee Fee Rate
accrued for one month on the aggregate
Stated Principal Balance of the Mortgage
Loans and any REO Properties as of the
first day of the related Due Period (or, in
the case of the initial Distribution
Date, as of the Cut-off Date), calculated
on the basis of a 360-day year
consisting of twelve 30-day months.
"Trustee Fee Rate": 0.0050% per annum.
"Uncertificated Balance": The amount of any REMIC Regular
Interest outstanding as of any date of
determination. As of the Closing Date,
the Uncertificated Balance of each REMIC
Regular Interest shall equal the amount
set forth in the Preliminary Statement
hereto as its initial uncertificated
balance. On each Distribution Date, the
Uncertificated Balance of each REMIC
Regular Interest shall be reduced by all
distributions of principal made on such
REMIC Regular Interest on such Distribution
Date pursuant to Section 4.01 and,
if and to the extent necessary and
appropriate, shall be further reduced on such
Distribution Date by Realized Losses as
provided in Section 4.04. The
Uncertificated Balance of REMIC I Regular
Interest I-LTZZ shall be increased by
interest deferrals as provided in Section
4.01). The Uncertificated Balance of
each REMIC Regular Interest shall never be
less than zero.
"Uncertificated Interest": With respect to any REMIC Regular
Interest for any Distribution Date, one
month's interest at the REMIC I
Remittance Rate applicable to such
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REMIC Regular Interest for such
Distribution Date, accrued on the Uncertificated
Balance thereof immediately prior to such
Distribution Date. Uncertificated
Interest in respect of any REMIC Regular
Interest shall accrue on the basis of a
360-day year consisting of twelve 30-day
months. Uncertificated Interest with
respect to each Distribution Date, as to
any REMIC Regular Interest, shall be
reduced by an amount equal to the sum of
(a) the aggregate Prepayment Interest
Shortfall, if any, for such Distribution
Date to the extent not covered by
payments pursuant to Section 3.24 and (b)
the aggregate amount of any Relief Act
Interest Shortfall, if any allocated, in
each case, to such REMIC Regular
Interest pursuant to Section 1.02. In
addition, Uncertificated Interest with
respect to each Distribution Date, as to
any REMIC Regular Interest shall be
reduced by Realized Losses, if any,
allocated to such REMIC Regular Interest
pursuant to Section 1.02 and Section
4.04.
"Underwriters' Exemption": An individual exemption issued by
the United States Department of Labor,
Prohibited Transaction Exemption 91-23
(56 Fed. Reg. 15936, April 19, 1991), as
amended, to Citigroup Global Markets
Inc. (formerly known as Salomon Smith
Barney Inc.), for specific offerings in
which Citigroup Global Markets Inc. or any
person directly or indirectly,
through one or more intermediaries,
controlling, controlled by or under common
control with Citigroup Global Markets Inc.
is an underwriter, placement agent or
a manager or co-manager of the underwriting
syndicate or selling group where the
trust and the offered certificates meet
specified conditions. The Underwriters'
Exemption, as amended, provides a partial
exemption for transactions involving
certificates representing a beneficial
interest in a trust and entitling the
holder to pass-through payments of
principal, interest and/or other payments
with respect to the trust's assets.
"Uninsured Cause": Any cause of damage to a Mortgaged Property
such that the complete restoration of such
property is not fully reimbursable by
the hazard insurance policies required to
be maintained pursuant to Section
3.14.
"United States Person": A citizen or resident of the United
States, a corporation, partnership (or
other entity treated as a corporation or
partnership for United States federal
income tax purposes) created or organized
in, or under the laws of, the United
States, any state thereof, or the District
of Columbia (except in the case of a
partnership, to the extent provided in
Treasury regulations) provided that, for
purposes solely of the restrictions on
the transfer of Residual Certificates, no
partnership or other entity treated as
a partnership for United States federal
income tax purposes shall be treated as
a United States Person unless all persons
that own an interest in such
partnership either directly or through any
entity that is not a corporation for
United States federal income tax purposes
are required by the applicable
operative agreement to be United States
Persons, or an estate the income of
which from sources without the United
States is includible in gross income for
United States federal income tax purposes
regardless of its connection with the
conduct of a trade or business within the
United States, or a trust if a court
within the United States is able to
exercise primary supervision over the
administration of the trust and one or more
United States persons have authority
to control all substantial decisions of the
trust. The term "United States"
shall have the meaning set forth in Section
7701 of the Code or successor
provisions.
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<PAGE>
"Value": With respect to any Mortgage Loan, and the related
Mortgaged Property, the lesser of:
(i) the lesser
of (a) the value thereof as determined by
an appraisal made for the originator of the Mortgage
Loan at the time of origination of the Mortgage Loan
by an appraiser who met the minimum requirements of
Fannie Mae and Freddie Mac, and (b) the value thereof
as determined by a review appraisal conducted by the
Originator in the event any such review appraisal
determines an appraised value more than 10% lower
than the value thereof, in the case of a Mortgaged
Loan with a Loan-to-Value Ratio less than or equal to
80%, or more than 5% lower than the value thereof, in
the case of a Mortgage Loan with a Loan-to-Value
Ratio greater than 80%, as determined by the
appraisal referred to in clause (i)(a) above; and
(ii)
the purchase price paid for the related Mortgaged
Property by the Mortgagor with the proceeds of the
Mortgage Loan; provided, however, that in the case of
a refinanced Mortgage Loan (which is a Mortgage Loan
the proceeds of which were not used to purchase the
related Mortgaged Property) or a Mortgage Loan
originated in connection with a "lease option
purchase" if the "lease option purchase price" was
set 12 months or more
prior to origination, such
value of the Mortgaged Property is based solely upon
clause (i) above.
"Voting Rights": The portion of the voting rights of all of
the Certificates which is allocated to any
Certificate. With respect to any date
of determination, 98% of all Voting Rights
will be allocated among the holders
of the Class A Certificates, the Mezzanine
Certificates and the Class CE
Certificates in proportion to the then
outstanding Certificate Principal
Balances of their respective Certificates,
1% of all Voting Rights will be
allocated to the holders of the Class P
Certificates and 1% of all Voting Rights
will be allocated among the holders of the
Residual Certificates. The Voting
Rights allocated to each Class of
Certificate shall be allocated among Holders
of each such Class in accordance with their
respective Percentage Interests as
of the most recent Record Date.
SECTION 1.02. Allocation of
Certain Interest Shortfalls.
For purposes of calculating the amount of Accrued Certificate
Interest and the amount of the Interest
Distribution Amount for the Class A
Certificates, the Mezzanine Certificates
and the Class CE Interest for any
Distribution Date, (1) the aggregate amount
of any Prepayment Interest
Shortfalls (to the extent not covered by
payments by the Servicer pursuant to
Section 3.24) and any Relief Act Interest
Shortfall incurred in respect of the
Mortgage Loans for any Distribution Date
shall be allocated first, to the Class
CE Interest based on, and to the extent of,
one month's interest at the then
applicable Pass-Through Rate on the
Notional Amount of the Class CE Interest
and, thereafter, among the Class A
Certificates and the Mezzanine Certificates
on a pro rata basis based on, and to the
extent of, one month's interest at the
then applicable respective Pass-Through
Rate on the respective Certificate
Principal Balance of each such Certificate
and (2) the aggregate amount of any
Realized Losses incurred for any
Distribution
44
<PAGE>
Date shall be allocated to the Class CE
Interest based on, and to the extent of,
one month's interest at the then applicable
Pass-Through Rate on the Notional
Amount of the Class CE Interest.
For purposes of calculating the amount of Uncertificated
Interest for the REMIC I Regular Interests
for any Distribution Date, the
aggregate amount of any Prepayment Interest
Shortfalls (to the extent not
covered by payments by the Servicer
pursuant to Section 3.24) and any Relief Act
Interest Shortfalls incurred in respect of
the Mortgage Loans for any
Distribution Date shall be allocated among
REMIC I Regular Interest I-LTAA,
REMIC I Regular Interest I-LTA1A, REMIC I
Regular Interest I-LTA1B, REMIC I
Regular Interest I-LTA1C, REMIC I Regular
Interest I-LTM1, REMIC I Regular
Interest I-LTM2, REMIC I Regular Interest
I-LTM3, REMIC I Regular Interest
I-LTM4, REMIC I Regular Interest I-LTM5,
REMIC I Regular Interest I-LTM6, REMIC
I Regular Interest I-LTM7, REMIC I Regular
Interest I-LTM8 REMIC I Regular
Interest I-LTM9, REMIC I Regular Interest
I-LTM10 and REMIC I Regular Interest
I-LTZZ on a pro rata basis based on, and to
the extent of, one month's interest
at the then applicable respective
Pass-Through Rate on the respective
Uncertificated Balance of each such REMIC I
Regular Interest.
For purposes of calculating the amount of the Accrued
Certificate Interest for the Class C
Certificates for any Distribution Date, the
aggregate amount of any Net Prepayment
Interest Shortfalls and any Relief Act
Interest Shortfalls allocated to the Class
C Interest shall be allocated to the
Class C Certificates.
45
<PAGE>
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of
the Mortgage Loans.
The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set
over and otherwise convey to the
Trustee without recourse, for the benefit
of the Certificateholders, all the
right, title and interest of the Depositor,
including any security interest
therein for the benefit of the Depositor,
in and to the Mortgage Loans
identified on the Mortgage Loan Schedule,
the rights of the Depositor under the
Mortgage Loan Purchase Agreement, and all
other assets included or to be
included in REMIC I. Such assignment
includes all interest and principal
received by the Depositor or the Master
Servicer on or with respect to the
Mortgage Loans (other than payments of
principal and interest due on such
Mortgage Loans on or before the Cut-off
Date). The Depositor herewith delivers
to the Trustee an executed original
Mortgage Loan Purchase Agreement.
In connection with such transfer and assignment, the Depositor
does hereby deliver to, and deposit with
the Custodian on behalf of the Trustee,
the following documents or instruments with
respect to each Mortgage Loan so
transferred and assigned (a "Mortgage
File"):
(i) the
original Mortgage Note, endorsed in blank or in
the following form: "Pay to the order of Deutsche Bank National
Trust
Company, as Trustee under the applicable agreement, without
recourse,"
with all prior and intervening endorsements showing a complete
chain of
endorsement from the originator to the Person so endorsing to
the
Trustee;
(ii)
the original Mortgage with evidence of recording
thereon, and the original recorded power of attorney, if the
Mortgage
was executed pursuant to a power of attorney, with evidence of
recording thereon;
(iii) an
original Assignment in blank;
(iv)
the original recorded Assignment or Assignments
showing a complete chain of assignment from the originator to
the
Person assigning the Mortgage to the Trustee as contemplated by
the
immediately preceding clause (iii);
(v) the
original or copies of each assumption,
modification, written assurance or substitution agreement, if any;
and
(vi)
the original lender's title insurance policy,
together with all endorsements or riders that were issued with
or
subsequent to the issuance of such policy, insuring the priority of
the
Mortgage as a first or second lien on the Mortgaged Property
represented therein as a fee interest vested in the Mortgagor, or
in
the event such original title policy is unavailable, a written
commitment or uniform binder or preliminary report of title issued
by
the title insurance or escrow company.
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<PAGE>
With respect to a maximum of approximately 2.00% of the
Mortgage Loans, by outstanding Stated
Principal Balance of the Mortgage Loans as
of the Cut-off Date, if any original
Mortgage Note referred to in Section
2.01(i) above cannot be located, the
obligations of the Depositor to deliver
such documents shall be deemed to be
satisfied upon delivery to the Trustee of a
photocopy of such Mortgage Note, if
available, with a lost note affidavit
substantially in the form of Exhibit H
attached hereto. If any of the original
Mortgage Notes for which a lost note
affidavit was delivered to the Custodian on
behalf of the Trustee is subsequently
located, such original Mortgage Note shall
be delivered to the Custodian on behalf of
the Trustee within three Business
Days.
The Depositor shall (at the expense of the Originator)
promptly (within sixty Business Days
following the later of the Closing Date and
the date of receipt by the Custodian on
behalf of the Trustee of the recording
information for a Mortgage, but in no event
later than 90 days following the
Closing Date) submit or cause to be
submitted for recording, at no expense to
the Trust Fund, the Trustee or the
Depositor, in the appropriate public office
for real property records, each Assignment
referred to in Sections 2.01(iii) and
(iv) above and in connection therewith, the
Depositor shall (at the expense of
the Originator) cause each original
Assignment to be executed in the following
form: "Deutsche Bank National Trust
Company, as Trustee under the applicable
agreement." In the event that any such
Assignment is lost or returned unrecorded
because of a defect therein, the Depositor
shall (at the expense of the
Originator) promptly prepare or cause to be
prepared a substitute Assignment or
cure or cause to be cured such defect, as
the case may be, and thereafter cause
each such Assignment to be duly
recorded.
The Depositor herewith delivers to the Trustee an executed
copy of the Mortgage Loan Purchase
Agreement.
Notwithstanding the foregoing, the Assignments of Mortgage
shall not be required to be submitted for
recording (except with respect to any
Mortgage Loan located in Maryland) unless
the Depositor is informed by the
Rating Agencies that such failure to record
would result in a withdrawal or a
downgrading by any Rating Agency of the
rating on any Class of Certificates;
provided, however, each Assignment shall be
submitted in the manner described
above, at no expense to the Trust Fund or
the Trustee, upon the earliest to
occur of: (i) reasonable direction by the
Holders of Certificates entitled to at
least 25% of the Voting Rights, (ii) the
occurrence of a Servicer Event of
Default, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure
relating to the Originator, (iv) the
occurrence of a servicing transfer as
described in Section 7.02 hereof, (v) upon
receipt of notice from the Servicer,
the occurrence of a bankruptcy, insolvency
or foreclosure relating to the
Mortgagor under the related Mortgage and
(vi) upon receipt of notice from the
Servicer, any Mortgage Loan that is 90 days
or more delinquent. Upon the
occurrence of one of the events set forth
in the immediately preceding sentence,
the Depositor shall (at the expense of the
Originator) deliver such Assignments
for recording as provided above, promptly
and in any event within 30 days
following receipt of notice by the
Servicer.
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<PAGE>
Notwithstanding the foregoing, the Assignments of Mortgage
shall not be required to be submitted for
recording (except with respect to any
Mortgage Loan located in Maryland) unless
the Depositor is informed by the
Rating Agencies that such failure to record
would result in a withdrawal or a
downgrading by any Rating Agency of the
rating on any Class of Certificates;
provided, however, each Assignment shall be
submitted in the manner described
above, at no expense to the Trust Fund or
the Trustee, upon the earliest to
occur of: (i) reasonable direction by the
Holders of Certificates entitled to at
least 25% of the Voting Rights, (ii) the
occurrence of a Servicer Event of
Default, (iii) the occurrence of a
bankruptcy, insolvency or foreclosure
relating to the Originator, (iv) the
occurrence of a servicing transfer as
described in Section 7.02 hereof, (v) upon
receipt of notice from the Servicer,
the occurrence of a bankruptcy, insolvency
or foreclosure relating to the
Mortgagor under the related Mortgage and
(vi) upon receipt of notice from the
Servicer, any Mortgage Loan that is 90 days
or more delinquent. Upon the
occurrence of one of the events set forth
in the immediately preceding sentence,
the Depositor shall (at the expense of the
Originator) deliver such Assignments
for recording as provided above, promptly
and in any event within 30 days
following receipt of notice by the
Servicer.
If any of the documents referred to in Sections 2.01(ii),
(iii) or (iv) above has, as of the Closing
Date, been submitted for recording
but either (x) has not been returned from
the applicable public recording office
or (y) has been lost or such public
recording office has retained the original
of such document, the obligations of the
Depositor to deliver such documents
shall be deemed to be satisfied upon (1)
delivery to the Custodian on behalf of
the Trustee of a copy of each such document
certified by the Originator in the
case of (x) above or the applicable public
recording office in the case of (y)
above to be a true and complete copy of the
original that was submitted for
recording and (2) if such copy is certified
by the Originator, delivery to the
Custodian on behalf of the Trustee,
promptly upon receipt thereof of either the
original or a copy of such document
certified by the applicable public recording
office to be a true and complete copy of
the original. Pursuant to the Mortgage
Loan Purchase Agreement, notice shall be
provided to the Trustee and the Rating
Agencies by the Originator if delivery
pursuant to clause (2) above will be made
more than 180 days after the Closing
Date.
If the original lender's title insurance policy was not
delivered pursuant to Section 2.01(vi)
above, the Depositor shall deliver or
cause to be delivered to the Custodian on
behalf of the Trustee, promptly after
receipt thereof, the original lender's
title insurance policy. The Depositor
shall deliver or cause to be delivered to
the Custodian on behalf of the
Trustee, promptly upon receipt thereof any
other original documents constituting
a part of a Mortgage File received with
respect to any Mortgage Loan, including,
but not limited to, any original documents
evidencing an assumption or
modification of any Mortgage Loan.
All original documents relating to the Mortgage Loans that are
not delivered to the Custodian on behalf of
the Trustee are and shall be held by
or on behalf of the Originator, the Seller,
the Depositor or the Servicer, as
the case may be, in trust for the benefit
of the Trustee on behalf of the
Certificateholders. In the event that any
such original document is required
pursuant to the terms of this Section 2.01
to be a part of a Mortgage File, such
document shall be delivered promptly to the
Custodian on behalf of the Trustee.
Any such original document
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<PAGE>
delivered to or held by the Depositor that
is not required pursuant to the terms
of this Section to be a part of a Mortgage
File, shall be delivered promptly to
the Servicer.
The parties hereto understand and agree that it is not
intended that any Mortgage Loan be included
in the Trust that is a high-cost
home loan as defined by the Homeownership
and Equity Protection Act of 1994 or
any other applicable predatory or abusive
lending laws.
The Depositor hereby directs the Trustee to execute, deliver
and perform its obligations under the Cap
Contracts on the Closing Date and
thereafter on behalf of the Trust and the
Holders of the Class A Certificates
and Mezzanine Certificates. The Seller, the
Depositor, the Servicer and the
Holders of the Class A Certificates and
Mezzanine Certificates by their
acceptance of such Certificates acknowledge
and agree that the Trustee shall
execute, deliver and perform the Trust's
obligations under the Cap Contracts and
shall do so solely in its capacity as
Trustee of the Trust Fund and not in its
individual capacity.
SECTION 2.02. Acceptance of
REMIC I by Trustee.
The Trustee (or the Custodian on behalf of the Trustee)
acknowledges receipt, subject to the
provisions of Section 2.01 and subject to
any exceptions noted on the exception
report described in the next paragraph
below, of the documents referred to in
Section 2.01 (other than such documents
described in Section 2.01(v)) above and all
other assets included in the
definition of "REMIC I" under clauses (i),
(iii), (iv) and (v) (to the extent of
amounts deposited into the Distribution
Account) and declares that it holds and
will hold such documents and the other
documents delivered to it constituting a
Mortgage File, and that it holds or will
hold all such assets and such other
assets included in the definition of "REMIC
I" in trust for the exclusive use
and benefit of all present and future
Certificateholders.
The Trustee, for the benefit of the Certificateholders, shall
cause the Custodian to review each Mortgage
File in accordance with the
Custodial Agreement, on or before the
Closing Date, and the Trustee shall cause
the Custodian to certify in substantially
the form attached hereto as Exhibit
C-1 that, as to each Mortgage Loan listed
in the Mortgage Loan Schedule (other
than any Mortgage Loan paid in full or any
Mortgage Loan specifically identified
in the exception report annexed thereto as
not being covered by such
certification), (i) all documents
constituting part of such Mortgage File (other
than such documents described in Section
2.01(v)) required to be delivered to it
pursuant to this Agreement are in its
possession, (ii) such documents have been
reviewed by the Trustee and appear regular
on their face and relate to such
Mortgage Loan and (iii) based on the
Trustee's examination and only as to the
foregoing, the Mortgagor's Name and the
street address and city of the Mortgaged
Property, and the information set forth in
the Mortgage Loan Schedule that
corresponds to items (i), (iii), (x)(A),
(xii), (xv) and (xix) of the definition
of "Mortgage Loan Schedule" accurately
reflects information set forth in the
Mortgage File. It is herein acknowledged
that, in conducting such review, the
Trustee (or the Custodian, as applicable)
is under no duty or obligation (i) to
inspect, review or examine any such
documents, instruments, certificates or
other papers to determine whether they are
genuine, enforceable, or appropriate
for the represented purpose or whether they
have actually been recorded or that
they are other than what they purport to be
on their face
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or (ii) to determine whether any Mortgage
File should include any of the
documents specified in clause (v) of
Section 2.01.
Prior to the first anniversary date of this Agreement, the
Trustee shall cause the Custodian to
deliver as required under the Custodial
Agreeement to the Depositor, the Trustee
and the Servicer a final certification
in the form annexed hereto as Exhibit C-2
evidencing the completeness of the
Mortgage Files, with any applicable
exceptions noted thereon, and the Servicer
shall forward a copy thereof to any
Sub-Servicer.
If in the process of reviewing the Mortgage Files and making
or preparing, as the case may be, the
certifications referred to above, the
Custodian, on behalf of the Trustee, finds
any document or documents
constituting a part of a Mortgage File to
be missing or defective in any
material respect, at the conclusion of its
review the Custodian, on behalf of
the Trustee, shall so notify the Depositor,
the Trustee and the Servicer. In
addition, upon the discovery by the
Depositor, the Servicer or the Trustee of a
breach of any of the representations and
warranties made by the Originator or
the Seller in the Mortgage Loan Purchase
Agreement in respect of any Mortgage
Loan which materially adversely affects
such Mortgage Loan or the interests of
the related Certificateholders in such
Mortgage Loan, the party discovering such
breach shall give prompt written notice to
the other parties.
The Trustee shall, at the written request and expense of any
Certificateholder, request the Custodian to
provide a written report to such
Certificateholder of all Mortgage Files
released to the Servicer for servicing
purposes.
The Depositor and the Trustee intend that the assignment and
transfer herein contemplated constitute a
sale of the Mortgage Loans, the
related Mortgage Notes and the related
documents, conveying good title thereto
free and clear of any liens and
encumbrances, from the Depositor to the Trustee
in trust for the benefit of the
Certificateholders and that such property not be
part of the Depositor's estate or property
of the Depositor in the event of any
insolvency by the Depositor. In the event
that such conveyance is deemed to be,
or to be made as security for, a loan, the
parties intend that the Depositor
shall be deemed to have granted and does
hereby grant to the Trustee a first
priority perfected security interest in all
of the Depositor's right, title and
interest in and to the Mortgage Loans, the
related Mortgage Notes and the
related documents, and that this Agreement
shall constitute a security agreement
under applicable law.
SECTION 2.03. Repurchase or
Substitution of Mortgage Loans
by the Originator or the Seller.
(a) Upon
discovery or receipt of notice of any materially
defective document in, or that a document
is missing from, a Mortgage File or of
the breach by the Originator or the Seller
of any representation, warranty or
covenant under the Mortgage Loan Purchase
Agreement (including any
representation, warranty or covenant
regarding the Prepayment Charge Schedule)
in respect of any Mortgage Loan that
materially adversely affects the value of
such Mortgage Loan or the interest therein
of the Certificateholders, the
Trustee shall promptly notify the
Originator, the Seller and the Servicer of
such defect, missing document or breach and
request that the Originator or the
Seller, as applicable, deliver such missing
document or cure such defect or
breach within 90 days from the date the
Originator or the Seller, as applicable,
was notified of such missing document,
defect or breach, and if the Originator
or the Seller, as applicable, does not
deliver such missing document or cure
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such defect or breach in all material
respects during such period, the Servicer,
to the extent it is not the Originator, the
Seller or an Affiliate of the
Seller, and otherwise the Trustee, in
accordance with Section 3.02(b), shall
enforce the obligations of the Originator
or the Seller, as applicable, under
the Mortgage Loan Purchase Agreement to
repurchase such Mortgage Loan from REMIC
I at the Purchase Price within 90 days
after the date on which the Originator or
the Seller, as applicable, was notified
(subject to Section 2.03(c)) of such
missing document, defect or breach, if and
to the extent that the Originator or
the Seller, as applicable, is obligated to
do so under the Mortgage Loan
Purchase Agreement. The Purchase Price for
the repurchased Mortgage Loan shall
be remitted to the Servicer for deposit in
the Collection Account and the
Trustee (or the Custodian on behalf of the
Trustee), upon receipt of written
certification from the Servicer of such
deposit, shall release to the Originator
or the Seller, as applicable, the related
Mortgage File and shall execute and
deliver such instruments of transfer or
assignment, in each case without
recourse, as the Originator or the Seller,
as applicable, shall furnish to it
and as shall be necessary to vest in the
Originator or the Seller, as
applicable, any Mortgage Loan released
pursuant hereto. The Trustee shall not
have any further responsibility with regard
to such Mortgage File (it being
understood that neither the Trustee nor the
Custodian shall have any
responsibility for determining the
sufficiency of such assignment for its
intended purpose). In lieu of repurchasing
any such Mortgage Loan as provided
above, if so provided in the Mortgage Loan
Purchase Agreement, the Originator or
the Seller, as applicable, may cause such
Mortgage Loan to be removed from REMIC
I (in which case it shall become a Deleted
Mortgage Loan) and substitute one or
more Qualified Substitute Mortgage Loans in
the manner and subject to the
limitations set forth in Section 2.03(b);
provided, however, the Originator may
not substitute a Qualified Substitute
Mortgage Loan for any Deleted Mortgage
Loan that violates any predatory or abusive
lending law. It is understood and
agreed that the obligation of the
Originator or the Seller, as applicable, to
cure or to repurchase (or to substitute
for) any Mortgage Loan as to which a
document is missing, a material defect in a
constituent document exists or as to
which such a breach has occurred and is
continuing shall constitute the sole
remedy respecting such omission, defect or
breach available to the Trustee and
the Certificateholders.
(b) Any
substitution of Qualified Substitute Mortgage
Loans for Deleted Mortgage Loans made
pursuant to Section 2.03(a) must be
effected prior to the date which is two
years after the Startup Day for REMIC I.
As to any Deleted Mortgage Loan for which the Originator or
the Seller, as applicable, substitutes a
Qualified Substitute Mortgage Loan or
Loans, such substitution shall be effected
by the Originator or the Seller, as
applicable, delivering to the Custodian, on
behalf of the Trustee, for such
Qualified Substitute Mortgage Loan or
Loans, the Mortgage Note, the Mortgage,
the Assignment to the Trustee, and such
other documents and agreements, with all
necessary endorsements thereon, as are
required by Section 2.01, together with
an Officers' Certificate providing that
each such Qualified Substitute Mortgage
Loan satisfies the definition thereof and
specifying the Substitution Adjustment
Amount (as described below), if any, in
connection with such substitution. In
accordance with the Custodial Agreement,
the Trustee shall cause the Custodian
to acknowledge receipt for such Qualified
Substitute Mortgage Loan or
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Loans and, within ten Business Days
thereafter, review such documents as
specified in Section 2.02 and cause the
Custodian to deliver to the Depositor,
the Trustee and the Servicer, with respect
to such Qualified Substitute Mortgage
Loan or Loans, a certification
substantially in the form attached hereto as
Exhibit C-1, with any applicable exceptions
noted thereon. Within one year of
the date of substitution, in accordance
with the Custodial Agreement, the
Trustee shall cause the Custodian to
deliver to the Depositor, the Trustee and
the Servicer a certification substantially
in the form of Exhibit C-2 hereto
with respect to such Qualified Substitute
Mortgage Loan or Loans, with any
applicable exceptions noted thereon.
Monthly Payments due with respect to
Qualified Substitute Mortgage Loans in the
month of substitution are not part of
REMIC I and will be retained by the
Originator or the Seller, as applicable. For
the month of substitution, distributions to
Certificateholders will reflect the
Monthly Payment due on such Deleted
Mortgage Loan on or before the Due Date in
the month of substitution, and the
Originator or the Seller, as applicable,
shall thereafter be entitled to retain all
amounts subsequently received in
respect of such Deleted Mortgage Loan. The
Depositor shall give or cause to be
given written notice to the
Certificateholders that such substitution has taken
place, shall amend the Mortgage Loan
Schedule to reflect the removal of such
Deleted Mortgage Loan from the terms of
this Agreement and the substitution of
the Qualified Substitute Mortgage Loan or
Loans and shall deliver a copy of such
amended Mortgage Loan Schedule to the
Trustee and the Custodian. Upon such
substitution, such Qualified Substitute
Mortgage Loan or Loans shall constitute
part of the Mortgage Pool and shall be
subject in all respects to the terms of
this Agreement and the Mortgage Loan
Purchase Agreement, including, all
applicable representations and warranties
thereof included in the Mortgage Loan
Purchase Agreement.
For any month in which the Originator or the Seller, as
applicable, substitutes one or more
Qualified Substitute Mortgage Loans for one
or more Deleted Mortgage Loans, the
Servicer will determine the amount (the
"Substitution Adjustment Amount"), if any,
by which the aggregate Purchase Price
of all such Deleted Mortgage Loans exceeds
the aggregate of, as to each such
Qualified Substitute Mortgage Loan, the
Stated Principal Balance thereof as of
the date of substitution, together with one
month's interest on such Principal
Balance at the applicable Net Mortgage
Rate, plus all outstanding Advances and
Servicing Advances (including
Nonrecoverable Advances and Nonrecoverable
Servicing Advances) related thereto. On the
date of such substitution, the
Originator or the Seller, as applicable,
will deliver or cause to be delivered
to the Servicer for deposit in the
Collection Account an amount equal to the
Substitution Adjustment Amount, if any, and
upon receipt by the Custodian, on
behalf of the Trustee, of the related
Qualified Substitute Mortgage Loan or
Loans and certification by the Servicer to
the Trustee of such deposit, the
Trustee shall cause the Custodian to
release as required by the Custodial
Agreement to the Originator or the Seller,
as applicable, the related Mortgage
File or Files and the Trustee shall execute
and deliver such instruments of
transfer or assignment, in each case
without recourse, the Originator or the
Seller, as applicable, shall deliver to it
and as shall be necessary to vest
therein any Deleted Mortgage Loan released
pursuant hereto.
In addition, the Originator or the Seller, as applicable,
shall obtain at its own expense and deliver
to the Trustee an Opinion of Counsel
to the effect that such substitution will
not cause (a) any federal tax to be
imposed on any Trust REMIC, including
without limitation, any federal tax
imposed on "prohibited transactions" under
Section 860F(a)(1) of the Code or on
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"contributions after the startup date"
under Section 860G(d)(1) of the Code, or
(b) any Trust REMIC to fail to qualify as a
REMIC at any time that any
Certificate is outstanding.
(c) Upon
discovery by the Depositor, the Originator, the
Seller, the Servicer or the Trustee that
any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of
Section 860G(a)(3) of the Code, the
party discovering such fact shall within
two Business Days give written notice
thereof to the other parties. In connection
therewith, the Originator, the
Seller or the Depositor shall repurchase
or, subject to the limitations set
forth in Section 2.03(b), substitute one or
more Qualified Substitute Mortgage
Loans for the affected Mortgage Loan within
90 days of the earlier of discovery
or receipt of such notice with respect to
such affected Mortgage Loan. Such
repurchase or substitution shall be made by
(i) the Originator or the Seller, as
the case may be, if the affected Mortgage
Loan's status as a non-qualified
mortgage is or results from a breach of any
representation, warranty or covenant
made by the Originator or the Seller, as
the case may be, under the Mortgage
Loan Purchase Agreement, or (ii) the
Depositor, if the affected Mortgage Loan's
status as a non-qualified mortgage is a
breach of no representation or warranty.
Any such repurchase or substitution shall
be made in the same manner as set
forth in Section 2.03(a). The Trustee (or
the Custodian on behalf of the
Trustee) shall reconvey to the Depositor,
the Originator or the Seller, as the
case may be, the Mortgage Loan to be
released pursuant hereto in the same
manner, and on the same terms and
conditions, as it would a Mortgage Loan
repurchased for breach of a representation
or warranty.
SECTION 2.04. Reserved.
SECTION 2.05. Representations,
Warranties and Covenants of
the Servicer.
The Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of the
Certificateholders and to the Depositor that as
of the Closing Date or as of such date
specifically provided herein:
(i) The
Servicer is duly organized, validly existing, and
in good standing under the laws of the jurisdiction of its
formation
and has all licenses necessary to carry on its business as now
being
conducted and is licensed, qualified and in good standing in the
states
where the Mortgaged Property is located if the laws of such
state
require licensing or qualification in order to conduct business of
the
type conducted by the Servicer or to ensure the enforceability
or
validity of each Mortgage Loan; the Servicer has the power and
authority to execute and deliver this Agreement and to perform
in
accordance herewith; the execution, delivery and performance of
this
Agreement (including all instruments of transfer to be
delivered
pursuant to this Agreement) by the Servicer and the consummation of
the
transactions contemplated hereby have been duly and validly
authorized;
this Agreement evidences the valid, binding and enforceable
obligation
of the Servicer, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally; and all requisite
corporate
action has been taken by the Servicer to make this Agreement valid
and
binding upon the Servicer in accordance with its terms;
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(ii)
The consummation of the transactions contemplated by
this Agreement are in the ordinary course of business of the
Servicer
and will not result in the breach of any term or provision of
the
charter or by-laws of the Servicer or result in the breach of any
term
or provision of, or conflict with or constitute a default under
or
result in the acceleration of any obligation under, any
agreement,
indenture or loan or credit agreement or other instrument to which
the
Servicer or its property is subject, or result in the violation of
any
law, rule, regulation, order, judgment or decree to which the
Servicer
or its property is subject;
(iii) The
execution and delivery of this Agreement by the
Servicer and the performance and compliance with its obligations
and
covenants hereunder do not require the consent or approval of
any
governmental authority or, if such consent or approval is required,
it
has been obtained;
(iv)
This Agreement, and all documents and instruments
contemplated hereby which are executed and delivered by the
Servicer,
constitute and will constitute valid, legal and binding obligations
of
the Servicer, enforceable in accordance with their respective
terms,
except as the enforcement thereof may be limited by applicable
bankruptcy laws and general principles of equity;
(v)
[Reserved];
(vi)
The Servicer does not believe, nor does it have any
reason or cause to believe, that it cannot perform each and
every
covenant contained in this Agreement;
(vii)
There is no action, suit, proceeding or investigation
pending or, to its knowledge, threatened against the Servicer
that,
either individually or in the aggregate, (A) may result in any
change
in the business, operations, financial condition, properties or
assets
of the Servicer that might prohibit or materially and adversely
affect
the performance by such Servicer of its obligations under, or
validity
or enforceability of, this Agreement, or (B) may result in any
material
impairment of the right or ability of the Servicer to carry on
its
business substantially as now conducted, or (C) may result in
any
material liability on the part of the Servicer, or (D) would draw
into
question the validity or enforceability of this Agreement or of
any
action taken or to be taken in connection with the obligations of
the
Servicer contemplated herein, or (E) would otherwise be likely
to
impair materially the ability of the Servicer to perform under
the
terms of this Agreement;
(viii) Neither
this Agreement nor any information,
certificate of an officer, statement furnished in writing or
report
delivered to the Trustee by the Servicer in connection with the
transactions contemplated hereby contains any untrue statement of
a
material fact;
(ix)
The Servicer will not waive any Prepayment Charge
unless it is waived in accordance with the standard set forth
in
Section 3.01; and
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(x) The
Servicer has accurately and fully reported, and
will continue to accurately and fully report, its borrower credit
files
to each of the credit repositories in a timely manner.
It is understood and agreed that the representations,
warranties and covenants set forth in this
Section 2.05 shall survive delivery
of the Mortgage Files to the Trustee and
shall inure to the benefit of the
Trustee, the Depositor and the
Certificateholders. Upon discovery by any of the
Depositor, the Servicer or the Trustee of a
breach of any of the foregoing
representations, warranties and covenants
which materially and adversely affects
the value of any Mortgage Loan or the
interests therein of the
Certificateholders, the party discovering
such breach shall give prompt written
notice (but in no event later than two
Business Days following such discovery)
to the Trustee. Subject to Section 7.01,
unless such breach shall not be
susceptible of cure within 90 days, the
obligation of the Servicer set forth in
this Section 2.05 to cure breaches shall
constitute the sole remedy against the
Servicer available to the
Certificateholders, the Depositor and the Trustee on
behalf of the Certificateholders respecting
a breach of the representations,
warranties and covenants contained in this
Section 2.05. Notwithstanding the
foregoing, within 90 days of the earlier of
discovery by the Servicer or receipt
of notice by the Servicer of a breach of
the representation or covenant of the
Servicer set forth in Section 2.05(ix)
above which materially and adversely
affects the interests of the Holders of the
Class P Certificates in any
Prepayment Charge, the Servicer shall pay
the amount of such waived Prepayment
Charge, for the benefit of the Holders of
the Class P Certificates, by
depositing such amount into the Collection
Account.
SECTION 2.06. Issuance of the
REMIC I Regular Interests
and the Class R-I Interest.
The Trustee acknowledges the assignment to it of the Mortgage
Loans and the delivery to it of the
Mortgage Files, subject to the provisions of
Section 2.01 and Section 2.02, together
with the assignment to it of all other
assets included in REMIC I, the receipt of
which is hereby acknowledged.
Concurrently with such assignment and
delivery and in exchange therefor, the
Trustee, pursuant to the written request of
the Depositor executed by an officer
of the Depositor, has executed,
authenticated and delivered to or upon the order
of the Depositor, the Class R-I Interest in
authorized denominations. The
interests evidenced by the Class R-I
Interest, together with the REMIC I Regular
Interests, constitute the entire beneficial
ownership interest in REMIC I. The
rights of the Class R-I Interest and REMIC
II (as holder of the REMIC I Regular
Interests) to receive distributions from
the proceeds of REMIC I in respect of
the Class R-I Interest and the REMIC I
Regular Interests, respectively, and all
ownership interests evidenced or
constituted by the Class R-I Interest and the
REMIC I Regular Interests, shall be as set
forth in this Agreement.
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SECTION 2.07. [Reserved].
SECTION 2.08. Conveyance of REMIC
Regular Interests and
Acceptance of REMIC I, REMIC II, REMIC III
and REMIC IV by the Trustee; Issuance of
Certificates.
(a) The
Depositor, concurrently with the execution and
delivery hereof, does hereby transfer,
assign, set over and otherwise convey in
trust to the Trustee without recourse all
the right, title and interest of the
Depositor in and to the assets described in
the definition of REMIC I for the
benefit of the holders of the REMIC I
Regular Interests (which are
uncertificated) and the Class R
Certificates (in respect of the Class R-I
Interest). The Trustee acknowledges receipt
of the assets described in the
definition of REMIC I and declares that it
holds and will hold the same in trust
for the exclusive use and benefit of the
holders of the REMIC I Regular
Interests and the Class R Certificates (in
respect of the Class R-I Interest).
The interests evidenced by the Class R-I
Interest, together with the REMIC I
Regular Interests, constitute the entire
beneficial ownership interest in REMIC
I.
(b) The
Depositor, concurrently with the execution and
delivery hereof, does hereby transfer,
assign, set over and otherwise convey in
trust to the Trustee without recourse all
the right, title and interest of the
Depositor in and to the REMIC I Regular
Interests (which are uncertificated) for
the benefit of the Holders of the Regular
Certificates and the Class R
Certificates (in respect of the Class R-II
Interest). The Trustee acknowledges
receipt of the REMIC I Regular Interests
and declares that it holds and will
hold the same in trust for the exclusive
use and benefit of the Holders of the
Regular Certificates and the Class R
Certificates (in respect of the Class R-II
Interest). The interests evidenced by the
Class R-II Interest, together with the
Regular Certificates (other than the Class
CE Certificates and the Class P
Certificates), the Class CE Interest and
the Class P Interest, constitute the
entire beneficial ownership interest in
REMIC II.
(c) The
Depositor, concurrently with the execution and
delivery hereof, does hereby transfer,
assign, set over and otherwise convey in
trust to the Trustee without recourse all
the right, title and interest of the
Depositor in and to the Class CE Interest
(which is uncertificated) for the
benefit of the Holders of the Class CE
Certificates and the Class R-X
Certificates (in respect of the Class R-III
Interest). The Trustee acknowledges
receipt of the Class CE Interest and
declares that it holds and will hold the
same in trust for the exclusive use and
benefit of the Holders of the Class CE
Certificates and the Class R-X Certificates
(in respect of the Class R-III
Interest). The interests evidenced by the
Class R-III Interest, together with
the Class CE Certificates, constitute the
entire beneficial ownership interest
in REMIC III.
(d) The
Depositor, concurrently with the execution and
delivery hereof, does hereby transfer,
assign, set over and otherwise convey in
trust to the Trustee without recourse all
the right, title and interest of the
Depositor in and to the Class P Interest
(which is uncertificated) for the
benefit of the Holders of the Class P
Certificates and the Class R-X
Certificates (in respect of the Class R-IV
Interest). The Trustee acknowledges
receipt of the Class P Interest and
declares that it holds and will hold the
same in trust for the exclusive use and
benefit of the Holders of the Class P
Certificates and the Class R-X Certificates
(in respect of the Class R-IV
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Interest). The interests evidenced by the
Class R-IV Interest, together with the
Class P Certificates, constitute the entire
beneficial ownership interest in
REMIC IV.
(e)
Concurrently with (i) the assignment and delivery to
the Trustee of REMIC I and the acceptance
by the Trustee thereof, pursuant to
Section 2.01, Section 2.02 and subsection
(a) hereof, (ii) the assignment and
delivery to the Trustee of REMIC II
(including the Residual Interest therein
represented by the Class R-II Interest) and
the acceptance by the Trustee
thereof, (iii) the assignment and delivery
to the Trustee of REMIC III
(including the Residual Interest therein
represented by the Class R-III
Interest) and the acceptance by the Trustee
thereof and (v) the assignment and
delivery to the Trustee of REMIC IV
(including the Residual Interest therein
represented by the Class R-IV Interest) and
the acceptance by the Trustee
thereof, the Trustee, pursuant to the
written request of the Depositor executed
by an officer of the Depositor, has
executed, authenticated and delivered to or
upon the order of the Depositor, (A) the
Class R Certificates in authorized
denominations evidencing the Class R-I
Interest and the Class R-II Interest and
(B) the Class R-X Certificates in
authorized denominations evidencing the Class
R-III Interest and the Class R-IV
Interest.
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ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.01. Servicer to Act as Servicer.
The Servicer shall service and administer the Mortgage Loans
on behalf of the Trust Fund and in the best
interests of and for the benefit of
all Certificateholders (as determined by
the Servicer in its reasonable
judgment) in accordance with the terms of
this Agreement and the Mortgage Loans
and, to the extent consistent with such
terms, in the same manner in which it
services and administers similar mortgage
loans for its own portfolio, giving
due consideration to customary and usual
standards of practice of mortgage
lenders and loan servicers administering
similar mortgage loans but without
regard to:
(A) any
relationship that the Servicer, any Sub-Servicer
or any Affiliate of the Servicer or any Sub-Servicer may have with
the
related Mortgagor;
(B) the
ownership or non-ownership of any Certificate by
the Servicer or any Affiliate of the Servicer;
(C) the
Servicer's obligation to make Advances or
Servicing Advances; or
(D) the
Servicer's or any Sub-Servicer's right to receive
compensation for its services hereunder or with respect to any
particular transaction.
To the extent consistent with the foregoing, the Servicer (a)
shall seek the timely and complete recovery
of principal and interest on the
Mortgage Notes and (b) shall waive (or
permit a Sub-Servicer to waive) a
Prepayment Charge only under the following
circumstances: (i) such waiver is
standard and customary in servicing similar
Mortgage Loans, relates to a default
or a reasonably foreseeable default and
would, in the reasonable judgment of the
Servicer, maximize recovery of total
proceeds taking into account the value of
such Prepayment Charge and the related
Mortgage Loan or (ii) such Prepayment
Charge is unenforceable in accordance with
applicable law or the collection of
such related Prepayment Charge would
otherwise violate applicable law. If a
Prepayment Charge is waived as permitted by
meeting the standards described in
clause (ii) above, then the Servicer (in
its capacity as Originator) shall be
required to pay the amount of such waived
Prepayment Charge, for the benefit of
the Holders of the P Certificates, by
depositing such amount into the Collection
Account together with and at the time the
amounts prepaid on the related
Mortgage Loan is required to be deposited
into the Collection Account. Subject
only to the above-described servicing
standards and the terms of this Agreement
and of the Mortgage Loans, the Servicer
shall have full power and authority,
acting alone or through Sub-Servicers as
provided in Section 3.02, to do or
cause to be done any and all things in
connection with such servicing and
administration which it may deem necessary
or desirable. Without limiting the
generality of the foregoing, the Servicer
in its own name or in the name of a
Sub-Servicer is hereby authorized and
empowered by the Trustee when the Servicer
believes it appropriate in its best
judgment in accordance with the servicing
standards
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set forth above, to execute and deliver, on
behalf of the Certificateholders and
the Trustee, and upon notice to the
Trustee, any and all instruments of
satisfaction or cancellation, or of partial
or full release or discharge, and
all other comparable instruments, with
respect to the Mortgage Loans and the
Mortgaged Properties and to institute
foreclosure proceedings or obtain a
deed-in-lieu of foreclosure so as to
convert the ownership of such properties,
and to hold or cause to be held title to
such properties, on behalf of the
Trustee and Certificateholders. The
Servicer shall service and administer the
Mortgage Loans in accordance with
applicable state and federal law and shall
provide to the Mortgagors any reports
required to be provided to them thereby.
The Servicer shall also comply in the
performance of this Agreement with all
reasonable rules and requirements of each
insurer under any standard hazard
insurance policy. Subject to Section 3.17,
within 15 days of the Closing Date,
the Trustee shall execute, at the written
request of the Servicer, and furnish
to the Servicer and any Sub-Servicer any
special or limited powers of attorney
for each county in which a Mortgaged
Property is located and other documents
necessary or appropriate to enable the
Servicer or any Sub-Servicer to carry out
their servicing and administrative duties
hereunder; PROVIDED, such limited
powers of attorney or other documents shall
be prepared by the Servicer and
submitted to the Trustee for execution. The
Trustee shall not be liable for the
actions of the Servicer or any
Sub-Servicers under such powers of attorney.
Subject to Section 3.09 hereof, in accordance with the
standards of the preceding paragraph, the
Servicer shall advance or cause to be
advanced funds as necessary for the purpose
of effecting the timely payment of
taxes and assessments on the Mortgaged
Properties, which advances shall be
Servicing Advances reimbursable in the
first instance from related collections
from the Mortgagors pursuant to Section
3.09, and further as provided in Section
3.11. Any cost incurred by the Servicer or
by Sub-Servicers in effecting the
timely payment of taxes and assessments on
a Mortgaged Property shall not, for
the purpose of calculating distributions to
Certificateholders, be added to the
unpaid Stated Principal Balance of the
related Mortgage Loan, notwithstanding
that the terms of such Mortgage Loan so
permit.
Notwithstanding anything in this Agreement to the contrary,
the Servicer may not make any future
advances with respect to a Mortgage Loan
(except as provided in Section 4.03) and
the Servicer shall not (i) permit any
modification with respect to any Mortgage
Loan that would change the Mortgage
Rate, reduce or increase the Stated
Principal Balance (except for reductions
resulting from actual payments of
principal) or change the final maturity date
on such Mortgage Loan (unless, as provided
in Section 3.07, the Mortgagor is in
default with respect to the Mortgage Loan
or such default is, in the judgment of
the Servicer, reasonably foreseeable) or
(ii) permit any modification, waiver or
amendment of any term of any Mortgage Loan
that would both (A) effect an
exchange or reissuance of such Mortgage
Loan under Section 1001 of the Code (or
Treasury regulations promulgated
thereunder) and (B) cause any Trust REMIC
created hereunder to fail to qualify as a
REMIC under the Code or the imposition
of any tax on "prohibited transactions" or
"contributions after the startup
date" under the REMIC Provisions.
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SECTION 3.02. Sub-Servicing
Agreements Between Servicer
and Sub-Servicers.
(a) The
Servicer may enter into Sub-Servicing Agreements
with Sub-Servicers for the servicing and
administration of the Mortgage Loans;
PROVIDED, HOWEVER, that such agreements
would not result in a withdrawal or a
downgrading by any Rating Agency of the
rating on any Class of Certificates. The
Trustee is hereby authorized to
acknowledge, at the request of the Servicer, any
Sub-Servicing Agreement that based on an
Officers' Certificate of the Servicer
delivered to the Trustee (upon which the
Trustee can conclusively rely), meets
the requirements applicable to
Sub-Servicing Agreements set forth in this
Agreement and that is otherwise permitted
under this Agreement.
Each Sub-Servicer shall be (i) authorized to transact business
in the state or states where the related
Mortgaged Properties it is to service
are situated, if and to the extent required
by applicable law to enable the
Sub-Servicer to perform its obligations
hereunder and under the Sub-Servicing
Agreement and (ii) a Freddie Mac or Fannie
Mae approved mortgage servicer. Each
Sub-Servicing Agreement must impose on the
Sub-Servicer requirements conforming
to the provisions set forth in Section 3.08
and provide for servicing of the
Mortgage Loans consistent with the terms of
this Agreement. The Servicer will
examine each Sub-Servicing Agreement and
will be familiar with the terms
thereof. The terms of any Sub-Servicing
Agreement will not be inconsistent with
any of the provisions of this Agreement.
The Servicer and the Sub-Servicers may
enter into and make amendments to the
Sub-Servicing Agreements or enter into
different forms of Sub-Servicing
Agreements; PROVIDED, HOWEVER, that any such
amendments or different forms shall be
consistent with and not violate the
provisions of this Agreement, and that no
such amendment or different form shall
be made or entered into which could be
reasonably expected to be materially
adverse to the interests of the
Certificateholders without the consent of the
Holders of Certificates entitled to at
least 66% of the Voting Rights; PROVIDED,
FURTHER, that the consent of the Holders of
Certificates entitled to at least
66% of the Voting Rights shall not be
required (i) to cure any ambiguity or
defect in a Sub-Servicing Agreement, (ii)
to correct, modify or supplement any
provisions of a Sub-Servicing Agreement, or
(iii) to make any other provisions
with respect to matters or questions
arising under a Sub-Servicing Agreement,
which, in each case, shall not be
inconsistent with the provisions of this
Agreement. Any variation without the
consent of the Holders of Certificates
entitled to at least 66% of the Voting
Rights from the provisions set forth in
Section 3.08 relating to insurance or
priority requirements of Sub-Servicing
Accounts, or credits and charges to the
Sub-Servicing Accounts or the timing and
amount of remittances by the Sub-Servicers
to the Servicer, are conclusively
deemed to be inconsistent with this
Agreement and therefore prohibited. The
Servicer shall deliver to the Trustee
copies of all Sub-Servicing Agreements,
and any amendments or modifications
thereof, promptly upon the Servicer's
execution and delivery of such
instruments.
(b) As part of
its servicing activities hereunder, the
Servicer, for the benefit of the Trustee
and the Certificateholders, shall
enforce the obligations of each
Sub-Servicer under the related Sub-Servicing
Agreement, including, without limitation,
any obligation to make advances in
respect of delinquent payments as required
by a Sub-Servicing Agreement, or to
purchase a Mortgage Loan on account of
missing or defective documentation or on
account of a
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breach of a representation, warranty or
covenant, as described in Section
2.03(a). Such enforcement, including,
without limitation, the legal prosecution
of claims, termination of Sub-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 Servicer, in its
good faith business judgment, would
require were it the owner of the related
Mortgage Loans. The Servicer shall pay
the costs of such enforcement at its own
expense, and shall be reimbursed
therefor only (i) from a general recovery
resulting from such enforcement, 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.
Enforcement of the Mortgage Loan Purchase
Agreement against the Originator or
the Seller shall be effected by the
Servicer to the extent it is not the
Originator, and otherwise by the Trustee in
accordance with the foregoing
provisions of this paragraph.
SECTION 3.03. Successor
Sub-Servicers.
The Servicer shall be entitled to terminate any Sub-Servicing
Agreement and the rights and obligations of
any Sub-Servicer pursuant to any
Sub-Servicing Agreement in accordance with
the terms and conditions of such
Sub-Servicing Agreement. In the event of
termination of any Sub-Servicer, all
servicing obligations of such Sub-Servicer
shall be assumed simultaneously by
the Servicer without any act or deed on the
part of such Sub-Servicer or the
Servicer, and the Servicer either shall
service directly the related Mortgage
Loans or shall enter into a Sub-Servicing
Agreement with a successor
Sub-Servicer which qualifies under Section
3.02.
Any Sub-Servicing Agreement shall include the provision that
such agreement may be immediately
terminated by the Trustee (if the Trustee is
acting as Servicer) without fee, in
accordance with the terms of this Agreement,
in the event that the Servicer (or the
Trustee, if such party is then acting as
Servicer) shall, for any reason, no longer
be the Servicer (including
termination due to a Servicer Event of
Termination).
SECTION 3.04. Liability of the
Servicer.
Notwithstanding any Sub-Servicing Agreement or the provisions
of this Agreement relating to agreements or
arrangements between the Servicer
and a Sub-Servicer or reference to actions
taken through a Sub-Servicer or
otherwise, the Servicer shall remain
obligated and primarily liable to the
Trustee and the Certificateholders for the
servicing and administering of the
Mortgage Loans in accordance with the
provisions of Section 3.01 without
diminution of such obligation or liability
by virtue of such Sub-Servicing
Agreements or arrangements or by virtue of
indemnification from the Sub-Servicer
and to the same extent and under the same
terms and conditions as if the
Servicer alone were servicing and
administering the Mortgage Loans. The Servicer
shall be entitled to enter into any
agreement with a Sub-Servicer for
indemnification of the Servicer by such
Sub-Servicer and nothing contained in
this Agreement shall be deemed to limit or
modify such indemnification.
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SECTION 3.05. No Contractual
Relationship Between
Sub-Servicers, the Trustee or
Certificateholders.
Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the
Mortgage Loans involving a Sub-Servicer
in its capacity as such shall be deemed to
be between the Sub-Servicer and the
Servicer alone, and the Trustee or
Certificateholders shall not be deemed
parties thereto and shall have no claims,
rights, obligations, duties or
liabilities with respect to the
Sub-Servicer except as set forth in Section
3.06. The Servicer shall be solely liable
for all fees owed by it to any
Sub-Servicer, irrespective of whether the
Servicer's compensation pursuant to
this Agreement is sufficient to pay such
fees.
SECTION 3.06. Assumption or
Termination of Sub-Servicing
Agreements
by Trustee.
In the event the Servicer shall for any reason no longer be
the servicer (including by reason of the
occurrence of a Servicer Event of
Termination), the Trustee shall thereupon
assume all of the rights and
obligations of the Servicer under each
Sub-Servicing Agreement that the Servicer
may have entered into, unless the Trustee
elects to terminate any Sub-Servicing
Agreement in accordance with its terms as
provided in Section 3.03. Upon such
assumption, the Trustee (or the successor
servicer appointed pursuant to Section
7.02) shall be deemed, subject to Section
3.03, to have assumed all of the
departing Servicer's interest therein and
to have replaced the departing
Servicer as a party to each Sub-Servicing
Agreement to the same extent as if
each Sub-Servicing Agreement had been
assigned to the assuming party, except
that (i) the departing Servicer shall not
thereby be relieved of any liability
or obligations under any Sub-Servicing
Agreement that arose before it ceased to
be the Servicer and (ii) neither the
Trustee nor any successor Servicer shall be
deemed to have assumed any liability or
obligation of the Servicer that arose
before it ceased to be the Servicer.
The Servicer at its expense shall, upon request of the
Trustee, deliver to the assuming party all
documents and records relating to
each Sub-Servicing Agreement and the
Mortgage Loans then being serviced and an
accounting of amounts collected and held by
or on behalf of it, and otherwise
use its best efforts to effect the orderly
and efficient transfer of the
Sub-Servicing Agreements to the assuming
party.
SECTION 3.07. Collection of
Certain Mortgage Loan
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