EXHIBIT 1.1
CITICORP MORTGAGE SECURITIES, INC.
REMIC Pass-Through Certificates, Series 2006-1
Underwriting Agreement
January 12, 2006
Credit Suisse Securities (USA) LLC, as Underwriter
Eleven Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Citicorp Mortgage Securities, Inc., a Delaware corporation ("CMSI"),
proposes to sell to you, as underwriter (the "Underwriter"), the offered class A
and class B REMIC Pass-Through Certificates (the "offered certificates")
described in Schedule I. The offered certificates evidence ownership interests
in a trust (the "Trust") consisting of the mortgage loans described in Schedule
I (the "mortgage loans") and related property. The mortgage loans were
originated or acquired by the affiliates of CMSI identified in Schedule I (the
"originators"), and will have, at the close of business on the "cut-off date"
specified in Schedule I, the aggregate principal balance set forth in Schedule
I. An election will be made to treat the Trust, or one or more segregated pools
of assets within the Trust, as one or more real estate mortgage investment
conduits (each a "REMIC") for purposes of federal income taxation. The offered
certificates are to be issued under a pooling and servicing agreement (the
"Pooling Agreement"), dated as of the cut-off date, between CMSI, as Depositor,
CitiMortgage, Inc. ("CMI"), as Servicer and Master Servicer, U.S. Bank National
Association, in its individual capacity and as Trustee (in such capacity, the
"Trustee"), and Citibank, N.A., in its individual capacity and as Paying Agent,
Certificate Registrar and Authentication Agent.
CMSI, Citigroup Inc., and the Underwriter agree as follows:
1 Purchase and Sale
Subject to the terms and conditions of, and in reliance upon the
representations and warranties made in, this Agreement, CMSI agrees to sell to
the Underwriter, and the Underwriter agrees to purchase from CMSI, all of the
offered certificates at the purchase price set forth in Schedule I.
2 Delivery and Payment
CMSI will deliver one or more certificates representing each class of
offered certificates to the Underwriter's account at the office, on the date and
at the time (the "clos-
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ing date") specified in Schedule I against payment by the
Underwriter of the purchase price to or upon the order of CMSI in the manner
provided in Schedule I. Unless otherwise specified in Schedule I, the offered
certificates will be registered in the name of Cede & Co., as nominee for The
Depository Trust Company ("DTC"), and the interests of beneficial owners of such
offered certificates will be represented by book entries on the records of DTC
and its participants. Definitive Certificates representing the offered
Certificates will be available as set forth in Schedule I.
CMSI will have the offered certificates available for inspection by the
Underwriter in New York, New York, one business day prior to the closing date.
3 Registration Statement and Prospectus
(a) CMSI represents and warrants to the Underwriter that CMSI has filed
a registration statement (File No. 333-109722), including a prospectus, with the
Securities and Exchange Commission (the "Commission") on Form S-3 that is
effective under the Securities Act of 1933, as amended (the "Securities Act")
and no stop order suspending the effectiveness of such registration statement
has been issued and no proceedings for that purpose have been initiated by the
Commission. CMSI further represents and warrants to the Underwriter that CMSI is
not an "ineligible issuer" as defined in Rule 405 under the Securities Act, at
the date specified in paragraph 3.ii of such Rule.
Such registration statement, as revised, amended or supplemented, including by
the filing of the Prospectus (as defined below), will at the relevant date be
the "Registration Statement" at that date. As used in this Agreement, the
Registration Statement will include, at the date of their filing, any documents
filed under the Securities Exchange Act of 1934, as amended (the "Exchange Act")
that are incorporated by reference into the prospectus included in the
Registration Statement pursuant to Item 12 of Form S-3 under the Securities Act,
and the terms "amend," "amendment" or "supplement" with respect to the
Registration Statement or the Prospectus will refer to and include the filing of
any document under the Exchange Act so incorporated by reference.
(b) Prior to the closing date, CMSI will file a final prospectus
relating to the offered certificates (the "Prospectus") with the Commission
pursuant to and in conformity with Rule 424 under the Securities Act. References
to the Prospectus at any time will refer to the Prospectus as amended or
supplemented at such time. CMSI will promptly advise the Underwriter when the
Prospectus has been so filed and, prior to the termination of the offering of
the offered certificates (the "offering"), will also promptly advise the
Underwriter
(i) when any amendment to the Registration Statement relating
to the offered certificates has become effective or any
revision of or supplement to the Prospectus has been so
filed,
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(ii) of any request by the Commission for an amendment of the
Registration Statement or the Prospectus or for any
additional information,
(iii) of the 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, and
(iv) of the receipt by CMSI of any notification with respect to
the suspension of the qualification of the offered
certificates for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose.
CMSI will use its best efforts to prevent the issuance of any such stop order
and, if issued, to obtain its withdrawal as soon as possible. CMSI will not file
prior to the termination of the offering any amendment to the Registration
Statement relating to the offered certificates, or any revision of or supplement
to the Prospectus, unless a copy has been furnished to the Underwriter for its
review prior to filing.
(c) CMSI represents and warrants to the Underwriter that the
Registration Statement on each of the date of this Agreement, the closing date,
and each date that offered certificates are sold by the Underwriter to any
investor, and the Prospectus as of its date, the closing date, and each date
that offered certificates are sold by the Underwriter to any investor,
(i) will conform in all material respects to the requirements
of the Securities Act and the applicable rules and
regulations of the Commission, and
(ii) will not include an untrue statement of a material fact or
omit to state a material fact necessary to make the
statements therein in the light of the circumstances under
which they are made, not misleading, except that CMSI makes
no representation or warranty concerning written
information furnished to CMSI by or on behalf of the
Underwriter specifically for use in connection with the
preparation of the Prospectus, consisting solely of such
Underwriter's statements as are included in Schedule I (the
"Underwriter supplied Prospectus information").
(d) The Underwriter represents and warrants to CMSI that the
Underwriter supplied Prospectus information does not include an untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein in the light of the circumstances under which they are made,
not misleading. CMSI acknowledges that the Underwriter supplied Prospectus
information comprises the only written information furnished by or on behalf of
the Underwriter for inclusion in the Prospectus.
(e) If, at any time when the Prospectus is required to be delivered
under the Securities Act,
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(i) an event occurs as a result of which the Prospectus at such
time would include an untrue statement of a material fact
or 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, or
(ii) the Prospectus must be revised, amended or supplemented to
comply with the Securities Act or the rules and regulations
of the Commission thereunder,
CMSI will promptly prepare and file with the Commission a revision, amendment or
supplement that corrects such statement or omission or effects such compliance.
(f) CMSI will furnish to the Underwriter and its counsel, without
charge, so long as delivery of the Prospectus is required under the Securities
Act, as many copies of the Prospectus and any revisions or amendments thereof or
supplements thereto as reasonably requested.
(g) If the third anniversary of the effective date of the Registration
Statement occurs within three months after the closing date, CMSI will take
action as necessary to permit the public offering and sale of the offered
certificates as contemplated by this Agreement.
4 Free writing prospectuses and loan tape
(a) CMSI will deliver electronically to the Underwriter in Portable
Document Format, not later than three business days following the date on which
CMSI notifies the Underwriter that CMSI has chosen it to underwrite the
offering, and will promptly file with the Commission, a "free writing
prospectus" (as defined in Rule 405 under the Securities Act) containing general
information about the offering, the structure of the transaction (exclusive of a
description of the properties of any particular class of offered certificates),
the expected parameters of the mortgage loan pools, risk factors applicable to
the mortgage loans, transaction parties known to CMSI, the material tax and
ERISA treatment of the Certificates, whether the Certificates will be "mortgage
related securities" as defined in the Exchange Act, and hyperlinks to the core
prospectus most recently filed by CMSI with the Commission and to the portion of
CMSI's static pool website containing static pool information with respect to
REMIC pass-through certificates of the same asset type (as determined by CMSI)
as the mortgage loans (the "CMSI free writing prospectus"). CMSI will deliver to
the Underwriter electronically in Portable Document Format updated CMSI free
writing prospectuses to correct any material misstatements or omissions in
previous CMSI free writing prospectuses. References to the CMSI free writing
prospectus at any time will refer to the CMSI free writing prospectus most
recently delivered to the Underwriter sufficiently prior to such time as to
reasonably permit the Underwriter to deliver the CMSI free writing prospectus to
the relevant investor.
(b) CMSI represents and warrants to the Underwriter that:
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(i) Each CMSI free writing prospectus will (A) contain the
legend required by section (c)(2)(i) of Rule 433 under the
Securities Act, (B) identify the Commission file number of
the Registration Statement, and (C) include the specific
address of or a hyperlink to an Internet Web site
containing static pool information regarding previous
issues of CMSI REMIC pass-through certificates.
(ii) At the time the investor commits to buy offered
certificates from the Underwriter, the CMSI free writing
prospectus, and the loan tape most recently furnished by
CMSI to the Underwriter (as supplemented or corrected by
CMSI prior to such time), will not contain any untrue
statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of
the circumstances under which they were made, not
misleading, provided that no representation or warranty is
made as to the effect of the exclusion from the CMSI free
writing prospectus of any information regarding the
properties of particular classes of offered certificates,
or a detailed description of the mortgage loans.
(c) CMSI will provide the Underwriter with one or more loan tapes
containing "loan level" listings of the mortgage loans that may contain
"nonpublic personal information" within the meaning of Regulation S-P of the
Commission. The Underwriter acknowledges that, to the extent the listing of the
mortgage loans contains any nonpublic personal information, the Underwriter will
be bound by the provisions of Rule 11 of Regulation S-P regarding limits on
redisclosure and reuse of such information.
(d) The Underwriter represents and warrants to CMSI that any written
communication containing material information about CMSI or its affiliates or
the offered certificates furnished to a prospective investor by the Underwriter,
other than a CMSI free writing prospectus, the Prospectus, the Registration
Statement or the loan tape most recently furnished by CMSI to the Underwriter
(as supplemented or corrected by CMSI prior to such time)
(i) conformed to the terms and conditions for a communication
in Rule 134 or a free writing prospectus in Rule 433 under
the Securities Act,
(ii) if a free writing prospectus, consisted solely of ABS
informational and computational material, and
(iii) if a free writing prospectus, did not include any untrue
statement of a material fact or omit any material fact
necessary to make the statements contained therein, when
considered in conjunction with the CMSI free writing
prospectus, if delivered to the prospective investor, in
light of the circumstances under which they were made, not
misleading, except that the Underwriter makes no
representation or warranty to the extent
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that (A) a misstatement was the result of any inaccurate
information supplied by CMSI to the Underwriter that was not
corrected by information subsequently supplied by CMSI to
the Underwriter sufficiently prior to the commitment of sale
of offered certificates to the investor as to reasonably
permit the Underwriter to correct any statement made to the
investor based on such misstatement, or (B) the free writing
prospectus substantially restates a statement in the
Prospectus or CMSI free writing prospectus (a
"restatement"), and does not omit to state a statement in
the Prospectus or CMSI free writing prospectus necessary to
make the restatement, when considered in conjunction with
the free writing prospectus and other information delivered
to the prospective investor, in light of the circumstances
under which the restatement was made, not misleading.
(e) Not later than four business day prior to the closing, the
Underwriter will deliver to CMSI, in electronic form suitable for conversion to
HTML format for filing with the Commission, all ABS informational and
computational material furnished to any investor, other than ABS informational
and computational material (i) concerning terms of the offered certificates that
are not the final terms of the offered certificates, or (ii) prepared by or on
behalf of the Underwriter on the basis of or derived from "issuer information"
(as defined in Rule 433 under the Securities Act) furnished to the Underwriter
by CMSI. CMSI will file such ABS informational and computational material with
the Commission as part of a free writing prospectus no later than the time such
material is required to be filed under Rule 433 under the Securities Act.
Notwithstanding the preceding sentence, CMSI will have no obligation to file
materials provided by the Underwriter that CMSI reasonably determines are not
required to be filed pursuant to Rule 433, or that contain erroneous information
or an untrue statement of a material fact or that, when read in conjunction with
the Prospectus, omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, it being understood,
however, that CMSI will have no obligation to review or pass upon the accuracy
or adequacy of, or to correct, any ABS informational or computational material
provided by the Underwriter to CMSI.
(f) The Underwriter will not sell, and will obligate each dealer to
whom it sells any offered certificates (which obligation may be in the form of a
trade stipulation and which must name CMSI as an intended third party
beneficiary) not to sell, any offered certificates to an investor who is not an
institutional investor unless the sale is accompanied or preceded by delivery of
the Prospectus.
(g) The Underwriter will file with the Commission not later than the
date of its first use any free writing prospectus that is distributed by or on
behalf of the Underwriter in a manner reasonably designed to lead to its broad,
unrestricted dissemination.
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(h) The Underwriter will retain for three years following conclusion of
the offering
(i) all free writing prospectuses that it has used in the
offering that are not filed with the Commission, and
(ii) written records documenting, as to each investor in offered
certificates, the time of sale to the investor, and the
date on which each CMSI free writing prospectus and each
free writing prospectus prepared by or on behalf of the
Underwriter was conveyed to the investor. If there is any
litigation or threatened litigation against CMSI or any of
its affiliates with respect to the offering, the
Underwriter will, on CMSI's request, make copies of such
records available to CMSI.
(i) The Underwriter will promptly provide CMSI with any information
within the Underwriter's reasonable control that CMSI reasonably requests to
enable CMSI to meet its disclosure and reporting obligations under the
Securities Act and the Exchange Act in connection with the Certificates. The
Underwriter will use its best efforts to cause any credit enhancement provider,
derivative counterparty, special servicer or credit risk manager arranged by the
Underwriter in connection with the offered certificates to promptly provide to
CMSI such narrative disclosure, financial information, including required
accountants' consents, and other information as CMSI may reasonably request to
enable CMSI to meet its disclosure and reporting obligations under the
Securities Act and the Exchange Act
(j) Notwithstanding any other provision of this Agreement, in any
action by CMSI or the Underwriter against the other party to enforce any rights
under this section 4, the losing party will pay all costs and expenses of the
prevailing party, including legal fees and expenses, incurred in connection with
such action.
5 Other representations and warranties
CMSI represents and warrants to the Underwriter that:
(a) Each of the class A and class B-1 offered certificates will, when
issued, be a "mortgage related security," as defined in section 3(a)(41) of the
Exchange Act, and each of the offered certificates, when validly authenticated,
issued and delivered in accordance with the Pooling Agreement, will be duly and
validly issued and outstanding and entitled to the benefits of the Pooling
Agreement;
(b) On the closing date, each of this Agreement and the Pooling
Agreement will have been duly authorized, executed and delivered by CMSI and,
assuming the valid execution of such agreements by the other parties, each such
agreement will constitute a valid and binding agreement of CMSI enforceable
against it in accordance with its terms, except as the same may be limited by
bankruptcy, insolvency, reorganization or other
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laws relating to or affecting the enforcement of creditors' rights and by
general equity principles;
(c) CMSI has been duly organized and is validly existing under the laws
of the State of Delaware, with corporate power and authority to own its
properties and conduct its business as described in the Prospectus; and
(d) CMSI is not, and on the date on which the first bona fide offer of
the Certificates is made will not be, an "ineligible issuer," as defined in Rule
405 under the Securities Act.
6 Expenses; Blue Sky
(a) CMSI will pay all expenses incidental to the performance of its
obligations under this Agreement, including expenses of
(i) preparing, filing, printing and reproducing the Prospectus,
of preparing, filing and reproducing the CMSI free writing
prospectus, the Registration Statement, this Agreement, and
the Pooling Agreement,
(ii) KPMG LLP (other than their expenses relating to the
preparation of the letter referred to in section 9(c)
below, which will be paid by the Underwriter), and
(iii) preparing and delivering the offered certificates to DTC,
provided, however, that except as provided in this section (a) and in section 8,
the Underwriter will pay (A) all of its own expenses, including the fees of
Cadwalader, Xxxxxxxxxx & Xxxx LLP and any other counsel to the Underwriter, (B)
any transfer taxes on resale of any of the offered certificates by it, and (C)
advertising expenses connected with any offers made by the Underwriter.
(b) CMSI will use its best efforts to arrange for, and will pay all
expenses of, the qualification of the offered certificates for sale under the
laws of such jurisdictions as the Underwriter may designate, to maintain such
qualifications in effect so long as required for the distribution of the offered
certificates and to arrange for the determination of the legality of the offered
certificates for purchase by institutional investors, However, CMSI will not be
required to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to general or unlimited
service of process in any jurisdiction where it is not now so subject.
7 No Fiduciary Relationship
(a) The Underwriter has been retained solely to act as underwriter in
connection with the sale of the offered certificates, and no fiduciary, advisory
or agency relationship between CMSI and the Underwriter has been created in
respect of any of the transactions
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contemplated by this Agreement, irrespective of whether the Underwriter has
advised or is advising CMSI on other matters;
(b) The purchase price was established by CMSI following discussions
and arm's-length negotiations with the Underwriter, and CMSI is capable of
evaluating and understanding and understands and accepts the terms, risks and
conditions of the transactions contemplated by this Agreement.
(c) CMSI has been advised that the Underwriter and its affiliates are
engaged in a broad range of transactions that may involve interests that differ
from those of CMSI, and that the Underwriter has no obligation to disclose such
interests and transactions to CMSI by virtue of any fiduciary, advisory or
agency relationship.
(d) CMSI waives, to the fullest extent permitted by applicable law, any
claims it may have against the Underwriter for breach of fiduciary duty, and
agrees that the Underwriter will have no liability (whether direct or indirect)
to CMSI in respect of such a fiduciary duty claim or to any person asserting a
fiduciary duty claim on behalf of or in right of CMSI, including stockholders,
employees or creditors of CMSI.
8 Conditions to the Obligation of the Underwriter
The Underwriter's obligation to purchase the offered certificates will
be subject to the accuracy in all material respects of CMSI's representations
and warranties in this Agreement at the date of this Agreement and the closing
date, to the accuracy of the statements of CMSI made in any officer's
certificate delivered pursuant to this Agreement, to the performance by CMSI of
its obligations under this Agreement, and to the following additional conditions
on the closing date:
(a) No stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose instituted and
pending or threatened.
(b) CMSI has delivered to the Underwriter a certificate of CMSI, dated
the closing date and signed by the President, Senior Vice President, Vice
President or an Assistant Vice President of CMSI, to the effect that the signer
of the certificate has examined the Registration Statement, the Prospectus and
this Agreement and that:
(i) CMSI's representations and warranties in this Agreement are
true and correct in all material respects on the closing
date with the same effect as if made on the closing date,
and CMSI has complied with all agreements and satisfied all
the conditions on its part to be performed or satisfied at
or prior to the closing date; and
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued, and no proceedings
for that purpose instituted and pending or, to such
officer's knowledge, threatened as of the closing date.
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(c) CMSI has delivered to the Underwriter an opinion, dated the closing
date, of the General Counsel, Finance and Capital Markets, of Citigroup Inc., or
other counsel reasonably acceptable to the Underwriter, to the effect that:
(i) Each of CMSI and CMI is a validly existing corporation in
good standing under the laws of the State of Delaware and
the State of New York, respectively, with corporate power
and authority under such laws to own its properties and
assets and conduct its business as described in the
Prospectus.
(ii) Citibank, N.A. has been duly chartered and is validly
existing as a national banking association in good standing
under the laws of the United States.
(iii) This Agreement has been duly authorized, executed and
delivered by each of CMSI and Citigroup Inc.
(iv) The Mortgage Loan Purchase Agreement has been duly
authorized, executed and delivered by CMSI and each
Originator listed on Schedule I hereto that is affiliated
with CMSI, and constitutes the valid and legally binding
obligation of CMSI and each such originator, enforceable in
accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization or other
similar laws relating to or affecting the enforcement of
creditors' rights and by general principles of equity.
(v) The Pooling Agreement has been duly authorized, executed
and delivered by CMSI, CMI and Citibank, N.A., and assuming
valid execution thereof by U.S. Bank National Association,
constitutes a valid and legally binding agreement of CMSI,
CMI, and Citibank, N.A., enforceable in accordance with its
terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization or other similar
laws relating to or affecting the enforcement of creditors'
rights and by general principles of equity.
(vi) The Pooling Agreement is not required to be qualified under
the Trust Indenture Act of 1939, as amended, and the Trust
Fund (as defined in the Pooling Agreement) is not required
to be registered under the Investment Company Act of 1940,
as amended.
(vii) The offered certificates have been duly authorized,
executed, issued, authenticated and delivered, and are
validly issued and outstanding and entitled to the benefits
provided by the Pooling Agreement.
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(vii) Assuming that each class of the offered class A
certificates and the class B-1 certificates are rated at
the time of issuance in one of the two highest rating
categories by a nationally recognized statistical rating
organization, each such class of certificates at such time
will be a "mortgage related security," as defined in
section 3(a)(41) of the Exchange Act.
(viii) The Registration Statement is effective under the
Securities Act, and, to the best knowledge of such counsel:
(A) No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings
for that purpose have been instituted or are pending or
have been threatened under the Securities Act.
(B) Each of the Registration Statement at its effective
date and the closing date, and the Prospectus at its date
and the closing date (in each case, with the exception of
any information incorporated by reference therein and any
numerical, financial, statistical or quantitative
information) appeared on its face to conform in all
material respects to the requirements of the Securities Act
and the applicable rules and regulations of the Commission.
(C) The descriptions
in the Prospectus and the Pooling Agreement of the
offered certificates, and
in the Prospectus of the aspects of certain statutes as
set forth under the heading "Core prospectus - ERISA
considerations" and "Prospectus supplement - Additional
ERISA considerations," to the extent they constitute
statements of matters of law or legal conclusions with
respect thereto,
are accurate in all material respects.
(ix) Each Originator listed on Schedule I hereto that is
affiliated with CMSI is a Delaware corporation, a New York
corporation, a federal savings bank or a national banking
association, as the case may be, validly existing under
applicable law, with full power and authority under such
law to own its properties and conduct its business as
described in the Prospectus.
(x) Such other opinions with regard to secured transactions,
bankruptcy, insolvency and related matters as the
Underwriter reasonably requests.
Such opinion may express its reliance (1) as to factual matters on the
representations and warranties made by, and on certificates or other documents
furnished by officers of, the parties to this Agreement and the Pooling
Agreement, (2) as to legal matters relating to the Employee Retirement Income
Security Act of 1974, as amended, on an opinion,
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dated the closing date, of counsel acceptable to the Underwriter, and (3) as to
legal matters relating to secured transactions, bankruptcy, insolvency and
related matters, on an opinion, dated the closing date, of Cadwalader,
Xxxxxxxxxx & Xxxx LLP, special bankruptcy counsel to CMSI. Such opinion may
assume the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than CMSI, CMI,
Citibank, N.A., Citigroup Inc. and the originators. Such opinion may be
qualified as an opinion only on the General Corporation Law of the State of
Delaware, the laws of each state in which the writer of the opinion is admitted
to practice law, and the federal law of the United States.
(d) CMSI has delivered to the Underwriter a letter, dated the closing
date, of the General Counsel, Finance and Capital Markets of Citigroup Inc., or
other counsel reasonably acceptable to the Underwriter, to the effect that in
the course of such counsel's review of the Registration Statement and the
Prospectus and discussion of the same with certain officers of CMSI, Citigroup
and the originators and their auditors, no facts came to the attention of such
counsel that led such counsel to believe that the Registration Statement as of
its effective date or the closing date, or the Prospectus as of its date or the
closing date, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, it being understood that such counsel need express no view as to
any information incorporated by reference or any financial, numerical,
statistical or quantitative information in the Registration Statement or the
Prospectus.
(e) CMSI has delivered to the Underwriter an opinion, dated the closing
date, of Cadwalader, Xxxxxxxxxx & Xxxx LLP, special tax counsel to CMSI, to the
effect that the statements in the Prospectus under the headings "Core
prospectus-Taxation of certificate holders," "Core prospectus-Taxation of the
Trust," and "Prospectus supplement-Federal income tax consequences," to the
extent such statements summarize material tax consequences of the purchase,
beneficial ownership and disposition of the offered certificates to the holders
thereof described therein, are correct in all material respects.
(f) The Underwriter have received from Cadwalader, Xxxxxxxxxx & Xxxx
LLP, counsel for the Underwriter, such opinion or opinions, dated the closing
date, with respect to the issuance and sale of the offered certificates, the
Registration Statement and the Prospectus, and such other related matters as the
Underwriter may reasonably request.
(g) KPMG LLP have furnished to the Underwriter a letter, dated the
closing date, in form and substance satisfactory to the Underwriter, stating in
effect that they have performed certain specified procedures, agreed upon
between KPMG LLP, CMSI and the Underwriter, as a result of which they have
determined that the information of an accounting, financial or statistical
nature with respect to "static pool information" contained on CMSI's website at
xxx.xxxxxxxxxxxxxxx.xxx relating to REMIC pass-through certificates issued after
January 1, 2006 and included in the Prospectus under Rule 312 of the
Commission's Regulation S-T, agrees with the accounting records of the
originators, excluding any questions of legal interpretation.
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(h) KPMG LLP have furnished to the Underwriter a letter, dated the
closing date, in form and substance satisfactory to the Underwriter, stating in
effect that
(i) They have performed certain specified procedures, agreed
upon between KPMG LLP CMSI and the Underwriter, as a result
of which they have determined that the information of an
accounting, financial or statistical nature (which is
limited to accounting, financial or statistical information
derived from the general accounting records of the
originators and which is obtained from an analysis of a
sample of the mortgage loans) set forth in the Prospectus
under the caption "Prospectus supplement-Summary-Series
overview-the mortgage loans at February 1, 2006 (the cut-off
date)" and in the detailed description relating to such
prospectus supplement and the mortgage loans agrees with the
accounting records of the originators, excluding any
questions of legal interpretation; and
(ii) They have compared the data contained in a data sheet or
computer tape prepared by CMI for the mortgage loans to
information contained in the mortgage loan files furnished
by the originators and in such other sources as will be
specified by them, based on an appropriate sampling
thereof, and found such data and information to be in
agreement, unless otherwise noted in such letter.
(i) If there is more than one class of offered certificates, KPMG LLP
have furnished to the Underwriter a letter, dated the date of the Prospectus, in
form and substance satisfactory to the Underwriter, stating in effect that:
(i) using the assumptions and methodology used by CMSI (which
include and do not conflict with any assumptions and
methodology set forth in the Prospectus), all of which will
be described by reference in such letter, they have
recalculated the percentages and weighted average lives set
forth in the Prospectus in the tables relating to the
"Prospectus supplement-Principal balance as percent of
initial principal balance" for each class of offered
certificates at certain percentages of the prepayment model
to be set forth in the Prospectus, compared the results of
their calculations to the corresponding items in the
respective table and found each such percentage and weighted
average life set forth in each such table to be in agreement
with the respective results of such calculations;
(ii) using the assumptions and methodology prescribed in the
Prospectus, they have recalculated, for each distribution
day (as defined in the Prospectus), the aggregate of the
amount of cash to be on deposit in the Trust on the
determination day immediately preceding such distribution
day and found that such aggregate amount equals or exceeds
the aggre-
13
gate amount of interest and distributions in
reduction of principal balance that is distributable on the
offered certificates on the following distribution day, as
recalculated by them;
(iii) using the assumptions and methodology prescribed in the
Pooling Agreement and the Prospectus, they have recomputed
the last distribution day for each class of offered
certificates and found such dates to be in agreement with
those set forth in the Prospectus;
(iv) if one or more classes of offered certificates will be
entitled to receive distributions in respect of interest at
other than a fixed rate or distributions in reduction of
principal balance according to a schedule of planned or
targeted balances, or have other characteristics which give
rise to the use of tables in the Prospectus reflecting
yield or cash flow, such letters will also set forth such
other statements as are customarily set forth by KPMG LLP
in such letters with respect to such classes; and
(v) using the assumptions and methodology used by CMSI set
forth in the Prospectus, all of which will be described by
reference in such letter, they have recalculated the
percentages set forth in the Prospectus in the tables
entitled "Prospectus supplement-Weighted average lives and
yields to maturity-Pre-tax yield to maturity" of classes
B-2 and B-3, compared the results of their calculations to
the corresponding items in such table and found each such
percentage set forth in such table to be in agreement with
the results of such calculations.
(j) Subsequent to the date hereof, there will not have occurred any
change, or any development involving a prospective change, in or affecting the
business or properties of CMSI which the Underwriter concludes, after
consultation with CMSI, in the judgment of the Underwriter, materially impairs
the investment quality of the offered certificates so as to make it impractical
or inadvisable to proceed with the public offering or the delivery of the
offered certificates as contemplated by the Prospectus.
(k) The offered certificates have been rated at least the rating or
ratings specified in Schedule I by the rating agency or agencies specified in
Schedule I and such ratings will not have been rescinded or placed under review.
(l) CMSI have furnished to the Underwriter such further information,
certificates and documents as the Underwriter may reasonably have requested not
less than three full business days prior to the closing date.
If any of the conditions specified in this section 8 are not fulfilled in all
material respects when and as provided in this Agreement, or if any of the
opinions and certificates mentioned above or elsewhere in this Agreement are not
in all material respects reasonably satisfactory in form and substance to the
Underwriter and its counsel, this Agreement and all obligations of the
Underwriter hereunder may be canceled at, or at any time prior to,
14
the closing date by the Underwriter. Notice of such cancellation will be given
to CMSI in writing, or by telephone or telegraph confirmed in writing.
9 Conditions to the Obligation of CMSI
The obligation of CMSI to issue and sell the offered certificates will
be subject to the satisfaction of the conditions that on the closing date,
(a) the class X-0, X-0 and B-6 certificates (as described in the
Prospectus) have been issued and sold under the Purchase Agreement dated the
date of this Agreement among CMSI, Citigroup Inc. and the purchaser thereof.
(b) the Underwriter has delivered to CMSI a certificate stating that
attached thereto are all of the information, tables, charts and other items
prepared by the Underwriter that constitute ABS informational or computational
material required to be furnished to CMSI under section 4(f) and stating that
the Underwriter has otherwise complied with section 4(f).
(c) KPMG LLP have furnished to CMSI and the Underwriter a letter or
letters, each in form and substance satisfactory to CMSI, relating to the ABS
informational or computational material of the Underwriter furnished to CMSI in
accordance with section 4(f), dated the closing date and stating in effect that:
(i) using the assumptions and methodology used by the
Underwriter, all of which will be described by reference in
the letter, they have recomputed the numerical data and
dates set forth in the ABS informational or computational
material (or portions thereof) attached to such letter,
compared the results of their calculations to the
corresponding items in such ABS informational or
computational material (or portions thereof) and found such
items to be in agreement with the respective results of
such calculations;
(ii) if such ABS informational or computational material
includes data reflecting the distribution of interest at
other than a fixed rate or the distribution in reduction of
principal balance according to a schedule of planned or
targeted balances, or reflecting other characteristics
which give rise to the use of tables in such ABS
informational or computational material, such letter will
also set forth such other statements as are customarily set
forth by KPMG LLP in such letter with respect to such data;
and
(iii) they have performed certain specified procedures as a
result of which they have determined that the information
of an accounting, financial or statistical nature set forth
in such ABS informational or computational material agrees
with the data sheet or computer tape prepared by CMSI,
unless otherwise indicated in such letter.
15
10 Indemnification and Contribution
(a) In this section 10,
(i) "claims" includes losses, claims, damages, expenses
(including legal and other expenses reasonably incurred in
investigating or defending the claims) or liabilities,
joint or several, (or actions in respect thereof) under the
Securities Act, the Exchange Act, or other federal or state
statutory law or regulation, at common law or otherwise,
and
(ii) a "controlling person" of a party is a person that controls
the party within the meaning of either the Securities Act
or the Exchange Act, and in the case of CMSI includes any
person who signed the Registration Statement.
(b) CMSI will indemnify and hold harmless the Underwriter and each of
its controlling persons against any claims to which any of them becomes subject,
to the extent such claims arise out of or are based upon
(i) a breach of any express representation or warranty given by
CMSI to the Underwriter in section 3, "Registration
Statement and Prospectus," or section 4, "Free writing
prospectuses," or
(ii) any untrue statement or alleged untrue statement of a
material fact, or omission of a material fact necessary to
make the statements therein, in light of the circumstances
under which they were made, not misleading, in any loan
tape supplied by CMSI to the Underwriter that was not
corrected by information subsequently supplied by CMSI to
the Underwriter sufficiently prior to the sale of offered
certificates to the investor making the claim as to
reasonably permit the Underwriter to correct any statement
made to the investor based on such untrue or alleged untrue
statement or material omission, or
(c) The Underwriter will indemnify and hold harmless CMSI and each of
its controlling persons against any claims to which any of them becomes subject,
to the extent such claims are based upon breach of any express representation or
warranty given by the Underwriter to CMSI in section 3, "Registration Statement
and Prospectus," or section 4, "free writing prospectuses."
(d) The indemnities in sections 10(b) and 10(c) will be in addition to
any liability that CMSI or the Underwriter may otherwise have.
(e) If a person entitled to indemnification under this section 10 is
notified of any action or threatened action involving a claim for which the
person may be entitled to seek indemnification or reimbursement under this
section 10, the person must promptly notify the indemnifying party in writing of
the action. However, the omission so to notify the indemnifying party will not
relieve the indemnifying party from any liability that it may
16
have to the indemnified person otherwise than under this section 10. The
indemnifying party will be entitled to participate in any such action, and to
the extent that it may elect by written notice delivered to the indemnified
person promptly after being notified by the indemnified person of the action, to
assume the defense thereof, with counsel selected by the indemnified person and
satisfactory to the indemnifying party (or if the indemnified person fails to
promptly select counsel following the receipt of the aforesaid notice, with
counsel selected by the indemnifying party and satisfactory to the indemnified
person). However, if the defendants in any such action include both indemnified
persons and the indemnifying party, and an indemnified person reasonably
concludes that there may be legal defenses available to it and/or other
indemnified persons that are different from or additional to those available to
the indemnifying party, the indemnified person or persons may select a single
separate counsel to assert such legal defenses and to otherwise participate in
the defense of the action on behalf of such indemnified person or persons.
Upon the indemnifying party's so assuming the defense of the action, the
indemnifying party will not be liable to the indemnified person in connection
with the defense thereof, except for
(i) the expenses of a single separate counsel to represent
indemnified persons in accordance with the last sentence in
the preceding paragraph, or
(ii) the indemnifying party does not employ counsel reasonably
satisfactory to the indemnified person within a reasonable
time after the indemnified person notifies the indemnifying
party of the action.
(f) In order to provide for just and equitable contribution in circumstances in
which the indemnification provided for in this Section 10 is due in accordance
with its terms but is for any reason held by a court to be unavailable on
grounds of policy or otherwise, CMSI and the Underwriter will contribute to the
aggregate claims to which CMSI and the Underwriter may be subject in such
proportion so that the Underwriter is responsible for 0.5% thereof and CMSI is
responsible for the balance; provided that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
will be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The relative fault will be determined by reference
to whether the untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, or such inaccurate or untrue
statement or representation, relates to information supplied by CMSI or the
Underwriter, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement, omission or
representation. For purposes of this Section 10, each controlling person will
have the same rights to contribution as the related party. Any person entitled
to contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this paragraph
(f), notify such party or parties from whom contribution may be sought, but the
omission to so notify such party or parties will
17
not relieve the party or parties from whom contribution may be sought from any
other obligation it or they may have hereunder or otherwise than under this
section (f).
11 Termination
This Agreement will be subject to termination in the absolute
discretion of the Underwriter, by notice given to CMSI prior to delivery of and
payment for the offered certificates, if prior to such time (i) trading in
securities generally on the New York Stock Exchange has been suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York is declared by either federal or New York State authorities, or
(iii) there is a material outbreak or escalation of hostilities or other
calamity or crisis the effect of which on the financial markets of the United
States is makes it, in the reasonable judgment of the Underwriter after
consultation with CMSI, impracticable to market the offered certificates.
12 Representations and indemnities to survive
The respective agreements, representations, warranties, indemnities and
other statements of CMSI and Citigroup Inc. and their respective officers and of
the Underwriter set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf of
the Underwriter, CMSI or Citigroup Inc. or any of the officers, directors or
controlling persons referred to in section 10 hereof, and will survive delivery
of and payment for the offered certificates. The provisions of sections 10 and
13 hereof will survive the termination or cancellation of this Agreement.
13 Obligation of Citigroup Inc.
Citigroup Inc. agrees, in consideration of and as an inducement to the
Underwriter's purchase of the offered certificates from CMSI, to indemnify and
hold harmless the Underwriter, and each person who controls the Underwriter
against any failure by CMSI to perform any of its obligations under this
Agreement, including any obligation of CMSI to the Underwriter pursuant to
sections 6 and 10 hereof, after receipt from the Underwriter of written notice
of any such failure.
14 Successors
This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors and
controlling persons referred to in section 10 hereof and their respective
successors and assigns, and no other person will have any right or obligation
hereunder.
18
15 Applicable law
This Agreement will be governed by and construed in accordance with the
laws of the State of New York.
16 Miscellaneous
This Agreement supersedes all prior or contemporaneous agreements and
understandings relating to its subject matter. Neither this Agreement nor any
term hereof may be changed, waived, discharged or terminated except by a writing
signed by the party against whom enforcement of such change, waiver, discharge
or termination is sought.
17 Notices
All communications hereunder will be in writing and effective only upon
receipt and, if sent to the Underwriter, will be delivered to the Underwriter's
address first stated in this Agreement (with a copy to its General Counsel's
Office), or if sent to CMSI, will be delivered to Citicorp Mortgage Securities,
Inc., 0000 Xxxxxxxxxx Xxxxx, X'Xxxxxx, Xxxxxxxx 00000, Attn: Xxxxx Xxxx Slough,
or if sent to Citigroup Inc., will be delivered to Citigroup Inc., Citigroup
Center, 000 Xxxx 00xx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxxxx
X. Xxxxx.
19
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to each of the undersigned a copy hereof,
whereupon this letter and your acceptance will represent a binding agreement
among CMSI, Citigroup Inc. and the Underwriter.
Very truly yours,
CITICORP MORTGAGE SECURITIES, INC.
By: /s/Xxxxxx X. Xxxxxx III
-----------------------------------------
Xxxxxx X. Xxxxxx III
Vice President
CITIGROUP INC.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------
Xxxxxxx X. Xxxxx
Assistant Treasurer
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
CREDIT SUISSE SECURITIES (USA) LLC
By: /s/ Xxxxx Xxxxxx
-----------------------------------------
Name: Xxxxx Xxxxxx, Director
Authorized Signatory
20
SCHEDULE I
Underwriting Agreement dated January 12, 2006
REMIC Pass-Through Certificates, Series 2006-1
Description of mortgage loans: For each pool of mortgage loans,
the description under COLLATERAL
INFORMATION on the Trade Ticket
that is attached as Attachment A
hereto. Any reference in the
Trade Ticket to 15 YR REG N/C means
10- to 15- year fixed-rate
conventional one- to four-family
mortgage loans, any reference to
30 YR REG N/C means 20- to
30- year fixed-rate conventional
one- to four-family mortgage loans,
and any reference to 30 YR RELO
N/C means 20- to 30- year
fixed-rate conventional one- to
four-family mortgage loans that
are originated through corporate
relocation programs. The
aggregate principal balance of
each pool of mortgage loans is
shown on the Trade Ticket under
Trade Amount, and is subject to an
upward or downward variance by
closing of up to 5%. The weighted
average per annum interest rate
of the mortgage loans in each pool
as of the cut-off date is expected
to be the percentage shown for the
pool under WAC--Final Pool on the
Trade Ticket, plus or minus the
basis points per annum shown on
the Trade Ticket. The weighted
average remaining term to stated
maturity of the mortgage loans in
each pool as of the cut-off date is
expected to be the number of months
for the pool shown under WAM--Final
Pool on the Trade Ticket, plus or
minus the number of months shown
on the Trade Ticket, except that
the number of months can not exceed
180 for a pool of 15 YR REG N/C
mortgage loans or 360 for a pool of
30 YR REG N/C or 30 YR RELO N/C
mortgage loans.
Offered certificates: Senior class A
(NON-PO) and, if shown on a Trade
Ticket, class A-PO and/or class A-IO
certificates (the "offered class A
certificates") and subordinated
class X-0, X-0 and B-3 certificates
(the "offered class B
certificates").
If there is only a single pool of
mortgage loans, each class of
offered certificates has a principal
balance equal to the percentage for
the class specified under SIZE in
the Trade Ticket of the Trade Amount
specified in the Trade Ticket.
If there is more than one pool of
mortgage loans:
(a) The offered class A certificates
(other than any offered class A-IO
certificates) in each "group" (as
defined in the Pooling Agreement)
have a principal balance equal to
the percentage for the class
specified under SIZE for the related
pool of the related Trade Amount
specified in the Trade Ticket, and
(b) Each class of offered class B
certificates has a principal balance
equal to the aggregate of the
principal balance of its component
classes. The principal balance of a
component class of a class of
certificates equals the percentage
for such class specified under SIZE
of the Trade Amount, as such SIZE
and Trade Amount are specified for
the pool related to the group for
the component class on the Trade
Ticket.
I-1
The principal balance of each class
of certificates is subject to upward
or downward variance at closing of
up to 5%.
The offered class A certificates may
include one or more classes of class
A certificates with the prior
consent of an authorized officer of
CMSI, which consent will not
unreasonably be withheld.
Additionally, class A-PO and A-IO
certificates may be composite
classes of certificates formed from
ratio-stripped PO and IO component
classes, respectively, from
different pools.
Purchase price: If there is a single pool of
mortgage loans, the sum of (a), (b)
and (c):
(a) The aggregate of the prices of each
class of offered certificates. The
price of a class of certificates is
calculated by multiplying the
principal balance (or for any
ratio-stripped IO class, notional
balance) of the class at closing by
the PRICE INFORMATION percentage for
the class shown on the Trade Ticket.
(b) Accrued interest on the aggregate
principal balance (or, for any
ratio-stripped IO class, notional
balance) at closing of each class of
offered certificates from (and
including) the ISSUE DATE shown on
the Trade Ticket to (but excluding)
the SETTLEMENT DATE shown on the
Trade Ticket at a rate per annum
equal to the target rate stated in
the Pooling Agreement.
(c) $75,000.
If there is more than one pool of
mortgage loans, the sum of (d), (e)
and (f):
(d) The aggregate, for each pool, of
the prices of each class (or
component class) of offered
certificates listed on the Trade
Ticket, calculated by multiplying
the principal balance (or for any
ratio-stripped IO class, notional
balance) at closing of each class
(or component class) of offered
certificates in the group related to
the pool (other than any composite
classes) by the PRICE INFORMATION
percentage for the class (or
component class) shown for such pool
on the Trade Ticket.
I-2
(e) accrued interest on the
aggregate principal balance (or, for
any ratio-stripped IO certificates,
notional balance) at closing of the
offered certificates (other than any
composite classes or ratio-stripped
PO classes of certificates) from
(and including) the ISSUE DATE shown
on the Trade Ticket to (but
excluding) the SETTLEMENT DATE shown
on the Trade Ticket at a rate per
annum equal to the target rate for
the pool stated in the Pooling
Agreement.
(f) $75,000.
Originator and Address: CitiMortgage, Inc.(1)
0000 Xxxxxxxxxx Xxxxx
X'Xxxxxx, Xxxxxxxx 00000
Cut-off date: The ISSUE DATE shown on the Trade
Ticket
Ratings of
offered certificates: Each class of offered
certificates will have the
ratings of the rating agencies
shown on the Trade Ticket. "S&P" on
the Trade Ticket refers to Standard
& Poor's Ratings Services,
"Moody's" refers to Xxxxx'x
Investors Service, Inc., and "Fitch"
refers to Fitch Ratings.
Denominations: The denominations of each class
of offered certificates will be as
set forth in the Prospectus. Such
denominations will be set by the
Underwriter, except that (1) the
minimum denomination of each
certificate of a class of offered
certificates will be $1,000, and
(2) if the initial principal or
notional balance of an offered
class of certificates is not a
permitted denomination for a
certificate of that class, one
certificate of the class may be
issued in a different denomination.
Underwriter's Statements to
be Included in the Prospectus: The purchase price for the
offered certificates will be set
by the underwriter or negotiated by
the purchaser and the underwriter
at the time of sale.
Subject to the terms and conditions
of the underwriting agreement among
Citigroup Inc., CMSI and the
underwriter, the underwriter will
purchase the offered certificates
from CMSI upon issuance. The
underwriter has committed to
purchase all of the offered
--------
(1) Mortgage loans of this originator include mortgage loans originated by
Citibank, N.A. or originated or acquired by Citibank, Federal Savings Bank
I-3
certificates if any certificates are
purchased. The underwriter will
distribute the offered certificates
from time to time in negotiated
transactions or otherwise at varying
prices to be determined at the time
of sale.
In connection with the purchase and
sale of the offered certificates,
the underwriter may be deemed to
have received compensation from CMSI
in the form of underwriting
discounts.
In connection with this offering,
the underwriter may over-allot or
effect transactions that stabilize
or maintain the market price of the
offered certificates at a level
above that which might otherwise
prevail in the open market. Such
stabilizing, if commenced, may be
discontinued at any time.
Delivery and Payment: Same day funds by federal funds
wire.
Closing date and Location: 10:00 a.m. (New York City time) on
the SETTLEMENT DATE shown on the
Trade Ticket at the offices of:
Citigroup Inc.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
I-4
ATTACHMENT A
A-1
