Exhibit 99.7
FINANCIAL SECURITY ASSURANCE(R)
FINANCIAL GUARANTY INSURANCE POLICY
OBLIGOR: CWHEQ
Revolving Home Equity
Policy No.: 51800-N
Loan
Trust, Series 2006-I
OBLIGATIONS: Revolving
Home Equity Loan Date of Issuance:
December 29, 2006
Asset Backed Notes,
Series 2006-I,
Class I-A and Class 2-A
FINANCIAL
SECURITY ASSURANCE INC. ("Financial Security"), for
consideration received, hereby UNCONDITIONALLY AND IRREVOCABLY
GUARANTEES to
each Holder, subject only to the terms of this Policy (which
includes each
endorsement hereto), the full and complete payment by the Obligor
of Scheduled
Payments of principal of, and interest on, the Obligations.
For the
further protection of each Holder, Financial Security
irrevocably and unconditionally guarantees:
(a) payment of the amount of any distribution of principal of,
or
interest on, the
Obligations made during the Term of this Policy to such
Holder
that is subsequently avoided in whole or in part as a
preference
payment
under applicable law (such payment to be made by Financial
Security
in accordance with Endorsement No. 1 hereto).
(b) payment of any amount required to be paid under this Policy
by
Financial
Security following Financial Security's receipt of notice as
described
in Endorsement No. 1 hereto.
Financial
Security shall be subrogated to the rights of each Holder to
receive payments under the Obligations to the extent of any payment
by
Financial Security hereunder.
Except to
the extent expressly modified by an endorsement hereto, the
following terms shall have the meanings specified for all purposes
of this
Policy. "Holder" means the registered owner of any Obligation as
indicated on
the registration books maintained by or on behalf of the Obligor
for such
purpose or, if the Obligation is in bearer form, the holder of the
Obligation.
"Scheduled Payments" means payments which are scheduled to be made
during the
Term of this Policy in accordance with the original terms of the
Obligations
when issued and without regard to any amendment or modification of
such
Obligations thereafter; payments which become due on an accelerated
basis as a
result of (a) a default by the Obligor, (b) an election by the
Obligor to pay
principal on an accelerated basis or (c) any other cause, shall not
constitute
"Scheduled Payments" unless Financial Security shall elect, in its
sole
discretion, to pay such principal due upon such acceleration
together with any
accrued interest to the date of acceleration. "Term of this Policy"
shall have
the meaning set forth in Endorsement No. 1 hereto.
This
Policy sets forth in full the undertaking of Financial
Security,
and shall not be modified, altered or affected by any other
agreement or
instrument, including any modification or amendment thereto, or by
the merger,
consolidation or dissolution of the Obligor. Except to the extent
expressly
modified by an endorsement hereto, the premiums paid in respect of
this Policy
are nonrefundable for any reason whatsoever, including payment, or
provision
being made for payment, of the Obligations prior to maturity. This
Policy may
not be cancelled or
<PAGE>
revoked during the Term of this Policy. THIS POLICY IS NOT
COVERED BY THE PROPERTY/CASUALTY INSURANCE SECURITY FUND SPECIFIED
IN ARTICLE
76 OF THE NEW YORK INSURANCE LAW.
In witness
whereof, FINANCIAL SECURITY ASSURANCE INC. has caused this
Policy to be executed on its behalf by its Authorized Officer.
FINANCIAL SECURITY ACCEPTANCE INC.
By
/s/ Doug Watson
--------------------------------
Authorized Officer
A subsidiary of Financial Security Assurance Holdings Ltd.
31 West 52nd Street, New York, N.Y. 10019
Form 100NY (5/89)
(212) 826-0100
2
<PAGE>
ENDORSEMENT NO. 1
TO FINANCIAL GUARANTY INSURANCE POLICY
FINANCIAL SECURITY ASSURANCE INC.
31 West 52nd Street
New York, New York 10019
OBLIGOR:
CWHEQ Revolving Home Equity Loan Trust, Series 2006-I,
established pursuant to the Trust Agreement dated December
27, 2006, between CWHEQ, Inc., as Depositor and Wilmington
Trust Company, as owner trustee
OBLIGATIONS:
$2,100,000,000 Revolving Home Equity Loan Asset Backed
Notes, Series 2006-I, Class 1-A and Class 2-A
Policy No.:
51800-N
Date of Issuance: December 29, 2006
1.
Definitions. For all purposes of this Policy, the terms
specified
below shall have the meanings or constructions provided below.
Capitalized
terms used herein and not otherwise defined herein shall have the
meanings
provided in the Indenture unless the context shall otherwise
require.
"Business
Day" means any day other than (i) a Saturday or Sunday or (ii)
a day on which banking institutions in New York City are authorized
or
obligated by law, executive order or governmental decree to be
closed.
"Holder"
shall have the meaning set forth in the Indenture; provided,
however that "Holder" shall not include the Obligor or any
affiliates or
successors thereof in the event the Obligor, or any such affiliate
or
successor, is a registered or beneficial owner of the
Obligation.
"Indenture" means the Indenture, dated as of December 29, 2006,
between
the Obligor and the Indenture Trustee, as amended from time to time
with the
consent of Financial Security.
"Indenture
Trustee" means The Bank of New York, in its capacity as
indenture trustee under the Indenture and any successor in such
capacity.
"Policy"
means this Financial Guaranty Insurance Policy and includes
each endorsement thereto.
"Receipt"
and "Received" mean actual delivery to Financial Security and
to the Fiscal Agent (as defined below), if any, prior to 12:00
noon, New York
City time, on a Business Day; delivery either on a day that is not
a Business
Day, or after 12:00 noon, New York City time, shall be deemed to be
receipt on
the next succeeding Business Day. If any notice or certificate
given hereunder
by the Indenture Trustee is not in proper form or is not properly
completed,
executed or delivered, or contains a misstatement, it shall be
deemed not to
have been Received,
<PAGE>
Policy No.: 51800-N
Date of Issuance: December 29, 2006
and Financial Security or its Fiscal Agent shall promptly so advise
the
Indenture Trustee and the Indenture Trustee may submit an amended
notice.
"Sale and
Servicing Agreement" means the Sale and Servicing Agreement,
dated as of December 29, 2006, among CWHEQ, Inc., as depositor,
Countrywide
Home Loans, Inc., as seller and master servicer, the Obligor and
the Indenture
Trustee, as amended from time to time with the consent of Financial
Security.
"Scheduled
Payments" means, with respect to each Payment Date, the
payment to be made to Holders in an aggregate amount equal to the
Guaranteed
Payment (as defined in the Indenture), in each case in accordance
with the
original terms of the Obligations when issued and without regard to
any
amendment or modification of the Obligations, the Indenture or the
Sale and
Servicing Agreement except amendments or modifications to which
Financial
Security has given its prior written consent. Scheduled Payments
shall not
include payments that become due on an accelerated basis as a
result of a
default by the Obligor, an election by the Obligor to pay principal
on an
accelerated basis, the occurrence of an Event of Default under the
Indenture
or any other cause, unless Financial Security elects, in its sole
discretion,
to pay in whole or in part such principal due upon acceleration,
together with
any accrued interest to the date of acceleration. In the event
Financial
Security does not so elect, this Policy will continue to guarantee
payment on
the Obligations in accordance with their original terms. Scheduled
Payments
shall not include any amounts due in respect of the Obligations
attributable
to any increase in interest rate, penalty or other sum payable by
the Obligor
by reason of any default or event of default in respect of the
Obligations, or
by reason of any deterioration of the creditworthiness of the
Obligor, nor
shall Scheduled Payments include, nor shall coverage be provided
under this
Policy in respect of any Basis Risk Carryforward, Accelerated
Principal
Payment Amount, any taxes, withholding or other charge imposed by
any
governmental authority due in connection with the payment of any
Scheduled
Payment to a Holder.
"Term Of
This Policy" means the period from and including the Date of
Issuance to and including the date on which (i) the Note Principal
Balance of
the Obligations is zero; (ii) any period during which any Scheduled
Payment
could have been avoided in whole or in part as a preference payment
under
applicable bankruptcy, insolvency, receivership or similar law
shall have
expired and (iii) if any proceedings requisite to avoidance as a
preference
payment have been commenced prior to the occurrence of (i) and
(ii), a final
and nonappealable order in resolution of each such proceeding has
been
entered.
2. Notices
and Conditions to Payment in Respect of Scheduled Payments.
Following Receipt by Financial Security of a notice and certificate
from the
Indenture Trustee in the form attached as Exhibit A to this
Endorsement,
Financial Security will pay any amount payable hereunder in respect
of
Scheduled Payments on the Obligations out of the funds of Financial
Security
on the later to occur of (a) 12:00 noon, New York City time, on the
second
Business Day following such Receipt; and (b)
