CITIGROUP MORTGAGE LOAN TRUST
INC.
$957,407,000
(Approximate)
Citigroup Mortgage Loan Trust
Inc.
Asset-Backed Pass-Through
Certificates, Series 2006-WFHE2
UNDERWRITING
AGREEMENT
Citigroup
Global Markets Inc.
390 Greenwich
Street, 4th Floor
Citigroup Mortgage Loan Trust Inc. (the
“Company”), a Delaware corporation, proposes to issue
Citigroup Mortgage Loan Trust 2006-WFHE2, Asset-Backed Pass-Through
Certificates, Series 2006-WFHE2 (the “Certificates”),
under a Pooling and Servicing Agreement (the “Pooling and
Servicing Agreement”), dated as of August 1, 2006, among the
Company, Wells Fargo Bank, N.A. (the “Servicer”),
Citibank, N.A. (the “Trust Administrator”) and U.S.
Bank National Association (the “Trustee”), and proposes
to sell the Registered Certificates (as defined below) to the
underwriter named in Schedule II hereto (the
“Underwriter”). If the firm or firms listed in Schedule
II hereto include only Citigroup Global Markets Inc., then the
terms “Underwriters” and “Representative,”
as used herein, shall each be deemed to refer to Citigroup Global
Markets Inc. The Certificates are designated as (i) the Class A-1
Certificates, the Class A-2A Certificates, the Class A-2B
Certificates, the Class A-3 Certificates (the “Class A
Certificates”), (ii) 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, the Class M-10
Certificates and the Class M-11 Certificates (the “Mezzanine
Certificates”), (iii) the Class CE Certificates and the Class
P Certificates (the “Retained Certificates”) and (iv)
the Class R Certificates and the Class R-X Certificates.
The Certificates will represent in the aggregate
the entire beneficial ownership interest in a trust fund (the
“Trust Fund”) consisting primarily of a segregated pool
(the “Mortgage Pool”) of one- to four-family,
fixed-rate and adjustable-rate, first-lien and second lien
residential mortgage loans (the “Mortgage Loans”). Each
Mortgage Loan provides for an original term to maturity of not
greater than 30 years. The Mortgage Loans will be acquired by the
Company from Citigroup Global Markets Realty Corp. (the
“Seller”) in exchange for immediately available funds
representing the purchase price and the Retained Certificates. The
Certificates are described more fully in Schedule I hereto. The
Class A Certificates and the Mezzanine Certificates (collectively,
the “Registered Certificates”) are more fully discussed
in a registration statement which the Company has furnished to you.
This is to confirm the arrangements with respect to your purchase
of the Registered Certificates.
Capitalized terms used but not defined herein
shall have the meanings assigned thereto in the Pooling and
Servicing Agreement.
1.
Representations and
Warranties : The Company
represents and warrants to, and agrees with, each Underwriter
that:
(a) The Company has filed with the Securities and
Exchange Commission (the “Commission”) a registration
statement on Form S-3 (the file number of which is set forth in
Schedule I hereto), for the registration of the Registered
Certificates under the Securities Act of 1933, as amended (the
“1933 Act”), which registration statement has become
effective and copies of which have heretofore been delivered to
you. Such registration statement, as amended as of the date hereof,
meets the requirements set forth in Rule 415(a)(1)(vii) under the
1933 Act and complies in all other material respects with the 1933
Act and the rules and regulations thereunder. The Company proposes
to file with the Commission pursuant to Rule 424 under the 1933 Act
a supplement to the form of prospectus included in such
registration statement relating to the Registered Certificates and
the plan of distribution thereof, and has previously advised you of
all further information (financial and other) with respect to the
Certificates and the Mortgage Pool to be set forth therein. Such
registration statement, including the exhibits thereto, as amended
as of the date hereof, is hereinafter called the
“Registration Statement”; the prospectus included in
the Registration Statement after the Registration Statement, as
amended, became effective, or as subsequently filed with the
Commission pursuant to Rule 424 under the 1933 Act, is hereinafter
called the “Basic Prospectus”; the form of prospectus
supplemented by the supplement to the form of prospectus relating
to the Registered Certificates, is hereinafter called the
“Prospectus Supplement” in the form in which it shall
be first filed with the Commission pursuant to Rule 424 (including
the Basic Prospectus) is hereinafter called a “Final
Prospectus.” The free writing prospectus dated August 8,
2006, that has heretofore been filed pursuant to Rule 433, is
hereinafter called the “Pricing Free Writing
Prospectus”. The Company will file with the Commission within
four days of the issuance of the Registered Certificates a report
on Form 8-K setting forth specific information concerning the
Registered Certificates and the Mortgage Pool to the extent that
such information is not set forth in the Final
Prospectus.
(b) As of the date hereof, when the Final Prospectus
is first filed pursuant to Rule 424 under the 1933 Act, when, prior
to the Closing Date (as hereinafter defined), any amendment to the
Registration Statement becomes effective, when any supplement to
the Final Prospectus is filed with the Commission, and at the
Closing Date, (i) the Registration Statement, as amended as of any
such time, the Final Prospectus, as amended or supplemented as of
any such time and the Pricing Free Writing Prospectus as of the
date hereof comply and will comply in all material respects with
the applicable requirements of the 1933 Act and the rules and
regulations thereunder, (ii) the Registration Statement, as amended
as of any such time, does not and will not contain any untrue
statement of material fact and does not and will not omit to state
any material fact required to be stated therein or necessary in
order to make the statements therein not misleading, and (iii) the
Final Prospectus, as amended or supplemented as of any such time
and the Pricing Free Writing Prospectus as of the date hereof, do
not and will not contain any untrue statement of a material fact
and do not and will not omit to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided ,
however , that the Company makes no representations or
warranties as to the information contained in or omitted from the
Registration Statement, the Pricing Free Writing Prospectus or
Final Prospectus or any amendment thereof or supplement thereto in
reliance upon and in conformity with the information furnished in
writing to the Company by or on behalf of any Underwriter through
the Representative specifically for use in connection with the
preparation of the Registration Statement and the Final Prospectus
as set forth in Exhibit A hereto (“the Underwriters’
Information”).
(c) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the laws
of the State of Delaware with full power and authority (corporate
and other) to own its properties and conduct its business as now
conducted by it and to enter into and perform its obligations under
(i) this Agreement, (ii) the Assignment and Recognition Agreement,
dated as of August 10, 2006 (the “Assignment and Recognition
Agreement”), between the Seller as assignor (the
“Assignor”), U.S. Bank, National Association as
assignee (the “Assignee”) and Wells Fargo Bank, N.A.
and (iii) the Pooling and Servicing Agreement; and the Company has
received no notice of proceedings relating to the revocation or
modification of any license, certificate, authority or permit
applicable to its owning such properties or conducting such
business which singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially and
adversely affect the conduct of the business, operations, financial
condition or income of the Company.
(d) As of the date hereof, when the Pricing Free
Writing Prospectus and the Final Prospectus is first filed pursuant
to Rule 433 and Rule 424, respectively under the 1933 Act, as
applicable, when, prior to the Closing Date (as hereinafter
defined), any amendment to the Registration Statement becomes
effective, when any supplement to the Final Prospectus is filed
with the Commission, and at the Closing Date, there has not and
will not have been (i) any request by the Commission for any
further amendment of the Registration Statement, the Final
Prospectus or for any additional information, (ii) any issuance by
the Commission of any stop order suspending the effectiveness of
the Registration Statement or the institution or threatening of any
proceeding for that purpose or (iii) any notification with respect
to the suspension of the qualification of the Registered
Certificates for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.
(e) This Agreement and the Assignment and
Recognition Agreement have been, and the Pooling and Servicing
Agreement when executed and delivered as contemplated hereby and
thereby will have been, duly authorized, executed and delivered by
the Company and each constitutes, or will constitute when so
executed and delivered, a legal, valid and binding agreement of the
Company, enforceable against the Company in accordance with its
terms, except as enforceability may be limited by (i) bankruptcy,
insolvency, liquidation, receivership, moratorium, reorganization
or other similar laws affecting the enforcement of the rights of
creditors, (ii) general principles of equity, whether enforcement
is sought in a proceeding in equity or at law and (iii) public
policy considerations underlying the securities laws, to the extent
that such public policy considerations limit the enforceability of
the provisions of this Agreement that purport to provide
indemnification from securities law liabilities.
(f) The Certificates and the Pooling and Servicing
Agreement will conform in all material respects to the description
thereof contained in the Pricing Free Writing Prospectus and the
Final Prospectus, and the Certificates, when duly and validly
authorized, executed, authenticated and delivered in accordance
with the Pooling and Servicing Agreement and paid for by the
Underwriters as provided herein, will be entitled to the benefits
of the Pooling and Servicing Agreement. On the Closing Date, the
Pooling and Servicing Agreement will be effective to establish the
Trust Fund as a valid trust under the laws of the State of New
York.
(g) As of the Cut-off Date, the Mortgage Loans will
meet the criteria for selection described in the Pricing Free
Writing Prospectus and the Final Prospectus and will conform to the
descriptions thereof contained in the Pricing Free Writing
Prospectus and the Final Prospectus.
(h) Neither the issuance and sale of the
Certificates, nor the execution and delivery by the Company of this
Agreement, the Assignment and Recognition Agreement or the Pooling
and Servicing Agreement, nor the consummation by the Company of any
of the transactions herein or therein contemplated, nor compliance
by the Company with the provisions hereof or thereof, will conflict
with or result in a breach of any term or provision of the
certificate of incorporation or by-laws of the Company or conflict
with, result in a breach, violation or acceleration of or
constitute a default under, the terms of any indenture or other
agreement or instrument to which the Company or any of its
affiliates is a party or by which it or any of them is bound, or
any statute, order or regulation applicable to the Company or any
of its affiliates of any court, regulatory body, administrative
agency or governmental body having jurisdiction over the Company or
any of its affiliates. Neither the Company nor any of its
affiliates is a party to, bound by or in breach or violation of any
indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects, or
may in the future materially and adversely affect, (i) validity or
enforceability of, or the ability of the Company to perform its
obligations under, this Agreement, the Assignment and Recognition
Agreement or the Pooling and Servicing Agreement or (ii) the
business, operations, financial conditions, properties or assets of
the Company.
(i) Except as disclosed in the Pricing Free Writing
Prospectus and the Final Prospectus, there are no actions or
proceedings against, or investigations of, the Company pending, or,
to the knowledge of the Company, threatened, before any court,
administrative agency or other tribunal (i) asserting the
invalidity of this Agreement, the Assignment and Recognition
Agreement, the Pooling and Servicing Agreement or the Certificates,
(ii) seeking to prevent the issuance of the Certificates or the
consummation of any of the transactions contemplated by this
Agreement, the Assignment and Recognition Agreement or the Pooling
and Servicing Agreement, (iii) that might materially and adversely
affect the performance by the Company of its obligations under, or
the validity or enforceability of, this Agreement, the Assignment
and Recognition Agreement, the Pooling and Servicing Agreement or
the Certificates, or (iv) seeking to affect adversely the federal
income tax attributes of the Certificates as described in the Final
Prospectus.
(j) There has not been any material adverse change
in the business, operations, financial condition, properties or
assets of the Company since June 30, 2006.
(k) Any taxes, fees and other governmental charges
payable by the Company in connection with the execution, delivery
and issuance of this Agreement, the Assignment and Recognition
Agreement and the Pooling and Servicing Agreement or the execution,
delivery and sale or transfer of the Certificates have been or will
be paid at or prior to the Closing Date.
(l) The Company is not, and the issuance and sale of
the Certificates in the manner contemplated by the Pricing Free
Writing Prospectus or the Final Prospectus will not cause the
Company to be, subject to registration or regulation as an
investment company or affiliate of an investment company under the
Investment Company Act of 1940, as amended (the “Investment
Company Act”).
(m) The transfer of the Mortgage Loans to the Trust
Fund at the Closing Date will be treated by the Company for
financial accounting and reporting purposes as a sale of assets and
not as a pledge of assets to secure debt.
(n) As of the Effective Date and as of the date of
the Contract of Sale, the Company is not an “ineligible
issuer” as defined in Rule 405 under the 1933 Act.
2.
Purchase and Sale
. Subject to the terms and
conditions and in reliance upon the representations and warranties
set forth herein, the Company agrees to sell to each Underwriter,
and each Underwriter agrees, severally and not jointly, to purchase
from the Company on the Closing Date, at the applicable purchase
price set forth in Schedule I hereto, the Certificates set forth
opposite such Underwriter’s name in Schedule II
hereto.
3.
Delivery and Payment
. Delivery of and payment for the
Registered Certificates shall be made in the manner, on the date
and at the time specified in Schedule I hereto (or such later date
not later than seven business days after such specified date as the
Representative shall designate), which date and time may be
postponed by agreement between the Representative and the Company
or as provided in this Agreement (such date and time of delivery
and payment for the Certificates being herein called the
“Closing Date”). Delivery of the Registered
Certificates, as set forth on Schedule I hereto, shall be made to
the Representative for the respective accounts of the several
Underwriters against payment in same day Federal funds by the
several Underwriters of the applicable purchase price. The
Registered Certificates shall be registered in such names and in
such authorized denominations as the Representative may request not
less than three full business days in advance of the Closing
Date.
The Company agrees to have the Certificates
available for inspection, checking and packaging by the
Representative in New York, New York, not later than 1:00 p.m. New
York time on the business day prior to the Closing Date.
4.
Offering by
Underwriters .
(a) It is understood that the several Underwriters
propose to offer the Certificates that are Registered Certificates
for sale to the public as set forth in the Final
Prospectus.
(b) Each Underwriter severally covenants and agrees
with the Company as to itself that:
(i) Prior to entering into any Contract of Sale, the
Underwriter shall convey the Pricing Free Writing Prospectus to
each prospective investor.
(ii) Unless preceded or accompanied by a prospectus
satisfying the requirements of Section 10(a) of the Securities Act
or access thereto is made available pursuant to Rule 173 of the
Securities Act, the Underwriter shall not convey or deliver any
written communication to any person in connection with the initial
offering of the Certificates, unless such written communication (1)
is made in reliance on Rule 134 under the Securities Act, (2)
constitutes a prospectus satisfying the requirements of Rule 430B
under the Securities Act or (3) is a Free Writing
Prospectus.
(iii) An Underwriter may convey a Preliminary Term
Sheet to a potential investor prior to entering into a Contract of
Sale with such investor; provided, however, that (x) such
Underwriter shall not enter into a Contract of Sale with such
investor unless the Underwriter has complied with paragraph (i)
above prior to such Contract of Sale, (y) such Underwriter shall
deliver a copy of the proposed Preliminary Term Sheet to the
Depositor and its counsel prior to the anticipated first use and
shall not convey any such Preliminary Term Sheet to which the
Depositor or its counsel reasonably objects.
(iv) An Underwriter may convey Computational
Materials (x) to a potential investor prior to entering into a
Contract of Sale with such investor; provided, however, that (A)
such Underwriter shall not enter into a Contract of Sale with such
investor unless the Underwriter has complied with paragraph (i)
above prior to such Contract of Sale and (B) such Computational
Materials shall not be disseminated in a manner reasonably designed
to lead to its broad unrestricted dissemination; provided, however,
that if such Computational Materials are disseminated in a manner
reasonably designed to lead to its broad unrestricted
dissemination, such Underwriter shall file with the Commission such
Computational Materials, and (y) to an investor after a Contract of
Sale, provided that the Underwriter has complied with paragraph (i)
above in connection with such Contract of Sale. The Underwriter
shall keep sufficient records of any conveyance of Computational
Materials to potential or actual investors and shall maintain such
records as required by the Rules and Regulations.
(v) If an Underwriter does not furnish a Free
Writing Prospectus that is required to be filed with the Commission
to the Depositor’s counsel prior to the scheduled print date
of the Final Prospectus, such Underwriter will be deemed to have
represented that it did not convey any such Free Writing Prospectus
to any potential investor.
(vi) Each Free Writing Prospectus shall contain
legends that are substantially similar to the following:
The issuer has
filed a registration statement (including a prospectus) with the
SEC for the offering to which this free writing prospectus relates.
Before you invest, you should read the base prospectus in that
registration statement and other documents the issuer has filed
with the SEC for more complete information about the issuer and
this offering. You may get these documents for free by visiting
EDGAR on the SEC website at www.sec.gov. Alternatively, the issuer,
any underwriter or any dealer participating in the offering will
arrange to send you the base prospectus if you request it by
calling toll-free 1-212-723-6766.
This free
writing prospectus is not required to contain all information that
is required to be included in the base prospectus.
The information
in this free writing prospectus is preliminary and is subject to
completion or change.
The information
in this free writing prospectus, if conveyed prior to the time of
your commitment to purchase, supersedes information contained in
any prior similar free writing prospectus relating to these
securities.
This free
writing prospectus is not an offer to sell or a solicitation of an
offer to buy these securities in any state where such offer,
solicitation or sale is not permitted.
This free
writing prospectus is being delivered to you solely to provide you
with information about the offering of the offered certificates
referred to in this free writing prospectus and to solicit an
indication of your interest in purchasing such offered
certificates, when, as and if issued. Any such indication of
interest will not constitute a contractual commitment by you to
purchase any of the offered certificates. You may withdraw your
indication of interest at any time.
(vii) Any Computational Materials shall include
legends, in addition to those specified in paragraph (vi) above,
substantially similar to the following:
The information
in this free writing prospectus may be based on preliminary
assumptions about the pool assets and the structure. Any such
assumptions are subject to change.
The information
in this free writing prospectus may reflect parameters, metrics or
scenarios specifically requested by you. If so, prior to the time
of your commitment to purchase, you should request updated
information based on any parameters, metrics or scenarios
specifically required by you.
Neither the
issuer of the securities nor any of its affiliates prepared,
provided, approved or verified any statistical or numerical
information presented in this free writing prospectus, although
that information may be based in part on loan level data provided
by the issuer or its affiliates.
(viii) Each Underwriter severally agrees to retain all
Free Writing Prospectuses that it has used and that are not filed
pursuant to this Section 4 for a period of three years following
the initial bona fide offering of the Registered
Certificates.
(c) The following terms shall have the meanings set
forth below, unless the context clearly indicates
otherwise:
Computational Materials : Any Free Writing Prospectus prepared by the
Underwriter that contains only (i) information of the type
specified in paragraph (5) of the definition of ABS Informational
and Computational Materials in Item 1101(a) of Regulation AB or
(ii) information that is not Issuer Information.
Contract of
Sale : The meaning set
forth in Rule 159 under the 1933 Act.
Derived
Information : Such
information, if any, in any Free Writing Prospectus prepared by any
Underwriter that is not contained in either (i) the Registration
Statement, the Base Prospectus or Final Prospectus or amendments or
supplements thereto, taking into account information incorporated
therein by reference or (ii) any Pool Information, except to the
extent that any omission or alleged omission in Derived Information
results from a Pool Error.
Free Writing
Prospectus : A
“written communication” within the meaning of Rule 405
under the 1933 Act that describes the Certificates and/or the
Mortgage Loans.
Issuer
Information : Such
information as defined in Rule 433(h) under the 1933 Act and which
shall not include information that is merely based on or derived
from such information.
Issuer Free
Writing Prospectus : The
meaning set forth in Rule 405 of the 1933 Act except that (i)
Computational Materials shall not be an Issuer Free Writing
Prospectus and (ii) any Free Writing Prospectus or portion thereof
prepared by or on behalf of an Underwriter than includes any Issuer
information that is not approved by the Depositor for use therein
shall not be an Issuer Free Writing Prospectus.
Preliminary
Term Sheet : A Free
Writing Prospectus that contains information of the type described
in paragraphs (1) - (3) of the definition of ABS Informational and
Computational Materials in Item 1101(a) of Regulation AB but which
does not included Derived Information.
(d) (i) In the event that any Underwriter or the
Company becomes aware that, as of the time of the Contract of Sale,
any Free Writing Prospectus delivered to a purchaser of a
Registered Certificate contained any untrue statement of a material
fact or omitted to state a material fact necessary in order to make
the statements contained therein, in light of the circumstances
under which they were made, not misleading (such Free Writing
Prospectus, a “Defective Free Writing Prospectus”), the
Underwriter or the Company shall notify the other parties to this
Agreement within one business day after discovery.
(ii) The party responsible for the information to be
corrected, if requested by the Company or an Underwriter, as
appropriate, shall prepare a Free Writing Prospectus with
Corrective Information that corrects the material misstatement in
or omission from the Defective Free Writing Prospectus (such
corrected Free Writing Prospectus, a “Corrected Free Writing
Prospectus”).
(iii) The Underwriters shall deliver the Corrected
Free Writing Prospectus to each purchaser of a Registered
Certificate which received the Defective Free Writing Prospectus
prior to entering into an agreement to purchase any Registered
Certificates.
(iv) The Underwriters shall notify such purchaser in
a prominent fashion that the prior agreement to purchase Registered
Certificates has been terminated, and of such purchaser’s
rights as a result of termination of such agreement.
(v) The Underwriters shall provide such purchaser
with an opportunity to affirmatively agree to purchase such
Registered Certificates on the terms described in the Corrected
Free Writing Prospectus.
(e) Each Underwriter covenants with the Company that
after the Final Prospectus is available, the Underwriter shall not
distribute any written information concerning the Registered
Certificates to a prospective purchaser of Registered Certificates
unless such information is preceded or accompanied by the Final
Prospectus.
5.
Agreements
. The Company agrees with the
several Underwriters that:
(a) The Company will not file any amendment to the
Registration Statement or supplement to (including the supplement
relating to the Registered Certificates included in the Final
Prospectus) the Basic Prospectus, unless the Company has furnished
to you a copy for your review prior to filing, and will not
f
