EXHIBIT 4.1
==============================================================================
CWABS, INC.,
Depositor
COUNTRYWIDE HOME LOANS, INC.,
Seller
PARK MONACO INC.,
Seller
PARK SIENNA LLC,
Seller
COUNTRYWIDE HOME LOANS SERVICING LP,
Master Servicer
THE BANK OF NEW YORK,
Trustee
and
THE BANK OF NEW YORK TRUST COMPANY, N.A.,
Co-Trustee
_________________________________
POOLING AND SERVICING AGREEMENT
Dated as of November 1, 2006
_________________________________
ASSET-BACKED CERTIFICATES, SERIES 2006-23
<PAGE>
<TABLE>
<CAPTION>
Table of Contents
-----------------
Page
----
ARTICLE I.
DEFINITIONS
<S>
<C>
Section 1.01 Defined
Terms..................................................................................10
Section 1.02 Certain
Interpretive
Provisions................................................................55
ARTICLE II.
CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance
of Mortgage
Loans...................................................................55
Section 2.02 Acceptance
by Trustee of the Mortgage
Loans....................................................63
Section 2.03
Representations, Warranties and Covenants of the Master Servicer
and the Sellers...............68
Section 2.04
Representations and Warranties of the
Depositor................................................88
Section 2.05 Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases................90
Section 2.06
Authentication and Delivery of
Certificates....................................................91
Section 2.07 Covenants
of the Master
Servicer...............................................................91
ARTICLE III.
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 3.01 Master
Servicer to Service Mortgage
Loans......................................................91
Section 3.02
Subservicing; Enforcement of the Obligations of Master
Servicer................................93
Section 3.03 Rights of
the Depositor, the Sellers, the Certificateholders, the NIM Insurer
and the
Trustee in Respect of the Master
Servicer......................................................94
Section 3.04 Trustee to
Act as Master
Servicer..............................................................95
Section 3.05 Collection
of Mortgage Loan Payments; Certificate Account; Distribution
Account;
Pre-Funding Account; Seller Shortfall Interest
Requirement.....................................95
Section 3.06 Collection
of Taxes, Assessments and Similar Items; Escrow
Accounts............................99
Section 3.07 Access to
Certain Documentation and Information Regarding the Mortgage
Loans...................99
Section 3.08 Permitted
Withdrawals from the Certificate Account, Distribution Account,
Carryover
Reserve Fund and the Principal Reserve
Fund...................................................100
Section 3.09
[Reserved]....................................................................................103
Section 3.10
Maintenance of Hazard
Insurance...............................................................103
Section 3.11
Enforcement of Due-On-Sale Clauses; Assumption
Agreements.....................................103
Section 3.12
Realization Upon Defaulted Mortgage Loans; Determination of Excess
Proceeds and
Realized Losses; Repurchase of Certain Mortgage
Loans.........................................105
Section 3.13 Co-Trustee
to Cooperate; Release of Mortgage
Files............................................108
Section 3.14 Documents,
Records and Funds in Possession of Master Servicer to be Held for
the
Trustee.......................................................................................109
Section 3.15 Servicing
Compensation........................................................................110
i
<PAGE>
Section 3.16 Access to
Certain
Documentation...............................................................110
Section 3.17 Annual
Statement as to
Compliance.............................................................111
Section 3.18
[Reserved]....................................................................................111
Section 3.19
[Reserved]....................................................................................111
Section 3.20 Prepayment
Charges............................................................................111
Section 3.21 Swap
Contract.................................................................................112
ARTICLE IV.
DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
Section 4.01 Advances;
Remittance
Reports..................................................................114
Section 4.02 Reduction
of Servicing Compensation in Connection with Prepayment Interest
Shortfalls.........116
Section 4.03
[Reserved]....................................................................................116
Section 4.04
Distributions.................................................................................116
Section 4.05 Monthly
Statements to
Certificateholders......................................................124
Section 4.06
Termination of a Mortgage Insurance
Policy....................................................125
Section 4.07 Carryover
Reserve
Fund........................................................................126
Section 4.08 Credit
Comeback Excess
Account................................................................126
Section 4.09 Swap Trust
and Swap
Account...................................................................127
Section 4.10 Final
Maturity Reserve Trust and Final Maturity Reserve
Fund..................................128
ARTICLE V.
THE CERTIFICATES
Section 5.01 The
Certificates..............................................................................130
Section 5.02
Certificate Register; Registration of Transfer and Exchange of
Certificates...................131
Section 5.03 Mutilated,
Destroyed, Lost or Stolen
Certificates.............................................136
Section 5.04 Persons
Deemed
Owners.........................................................................136
Section 5.05 Access to
List of Certificateholders' Names and
Addresses.....................................136
Section 5.06 Book-Entry
Certificates.......................................................................137
Section 5.07 Notices to
Depository.........................................................................138
Section 5.08 Definitive
Certificates.......................................................................138
Section 5.09
Maintenance of Office or
Agency...............................................................138
ARTICLE VI.
THE DEPOSITOR, THE MASTER SERVICER AND THE SELLERS
Section 6.01 Respective
Liabilities of the Depositor, the Master Servicer and the
Sellers..................139
Section 6.02 Merger or
Consolidation of the Depositor, the Master Servicer or the
Sellers..................139
Section 6.03 Limitation
on Liability of the Depositor, the Sellers, the Master Servicer,
the NIM
Insurer and
Others............................................................................139
Section 6.04 Limitation
on Resignation of Master
Servicer..................................................140
Section 6.05 Errors and
Omissions Insurance; Fidelity
Bonds................................................141
ii
<PAGE>
ARTICLE VII.
DEFAULT; TERMINATION OF MASTER SERVICER
Section 7.01 Events of
Default.............................................................................141
Section 7.02 Trustee to
Act; Appointment of
Successor......................................................143
Section 7.03
Notification to
Certificateholders............................................................145
ARTICLE VIII.
CONCERNING THE TRUSTEE AND THE CO-TRUSTEE
Section 8.01 Duties of
Trustee.............................................................................145
Section 8.02 Certain
Matters Affecting the
Trustee.........................................................147
Section 8.03 Trustee
Not Liable for Mortgage
Loans.........................................................148
Section 8.04 Trustee
May Own
Certificates..................................................................148
Section 8.05 Master
Servicer to Pay Trustee's Fees and
Expenses............................................148
Section 8.06
Eligibility Requirements for
Trustee..........................................................149
Section 8.07
Resignation and Removal of
Trustee............................................................149
Section 8.08 Successor
Trustee.............................................................................151
Section 8.09 Merger or
Consolidation of
Trustee............................................................151
Section 8.10
Appointment of Co-Trustee or Separate
Trustee.................................................151
Section 8.11 Tax
Matters...................................................................................153
Section 8.12
Co-Trustee....................................................................................156
Section 8.13 Access to
Records of the
Trustee..............................................................159
Section 8.14 Suits for
Enforcement.........................................................................159
ARTICLE IX.
TERMINATION
Section 9.01
Termination upon Liquidation or Repurchase of all Mortgage
Loans..............................160
Section 9.02 Final
Distribution on the
Certificates........................................................161
Section 9.03 Additional
Termination
Requirements...........................................................162
Section 9.04 Auction of
the Mortgage Loans and REO
Properties..............................................163
ARTICLE X.
MISCELLANEOUS PROVISIONS
Section 10.01
Amendment.....................................................................................167
Section 10.02 Recordation of
Agreement;
Counterparts........................................................169
Section 10.03 Governing
Law.................................................................................169
Section 10.04 Intention of
Parties..........................................................................169
Section 10.05
Notices.......................................................................................171
Section 10.06 Severability of
Provisions....................................................................172
Section 10.07
Assignment....................................................................................172
Section 10.08 Limitation on
Rights of
Certificateholders....................................................172
Section 10.09 Inspection and
Audit
Rights...................................................................173
Section 10.10 Certificates
Nonassessable and Fully
Paid.....................................................173
Section 10.11 Rights of NIM
Insurer.........................................................................173
iii
<PAGE>
ARTICLE XI.
EXCHANGE ACT REPORTING
Section 11.01 Filing
Obligations............................................................................175
Section 11.02 Form 10-D
Filings.............................................................................175
Section 11.03 Form 8-K
Filings..............................................................................176
Section 11.04 Form 10-K
Filings.............................................................................176
Section 11.05 Sarbanes-Oxley
Certification..................................................................177
Section 11.06 Form 15
Filing................................................................................177
Section 11.07 Report on
Assessment of Compliance and
Attestation............................................178
Section 11.08 Use of
Subservicers and
Subcontractors........................................................179
Section 11.09
Amendments....................................................................................180
Section 11.10 Reconciliation
of
Accounts....................................................................180
</TABLE>
Exhibits
--------
EXHIBIT A
Forms of Certificates
EXHIBIT A-1
Form of Class 1-A Certificate
EXHIBIT A-2
Form of Class 2-A-1 Certificate
EXHIBIT A-3
Form of Class 2-A-2 Certificate
EXHIBIT A-4
Form of Class 2-A-3 Certificate
EXHIBIT A-5
Form of Class 2-A-4 Certificate
EXHIBIT A-6
Form of Class M-1 Certificate
EXHIBIT A-7
Form of Class M-2 Certificate
EXHIBIT A-8
Form of Class M-3 Certificate
EXHIBIT A-9
Form of Class M-4 Certificate
EXHIBIT A-10
Form of Class M-5 Certificate
EXHIBIT A-11
Form of Class M-6 Certificate
EXHIBIT A-12
Form of Class M-7 Certificate
EXHIBIT A-13
Form of Class M-8 Certificate
EXHIBIT A-14
Form of Class M-9 Certificate
EXHIBIT A-15
Form of Class B Certificate
EXHIBIT B
Form of Class P Certificate
EXHIBIT C
Form of Class C Certificate
EXHIBIT D
Form of Class A-R Certificate
EXHIBIT E
Form of Tax Matters Person Certificate
EXHIBIT F
Mortgage Loan Schedule
EXHIBIT F-1
List of Mortgage Loans
EXHIBIT F-2
Mortgage Loans for which All or a Portion of
a Related Mortgage File is not Delivered
to the Trustee on or prior to the Closing
Date
EXHIBIT G
Forms of Certification of Trustee
EXHIBIT G-1
Form of Initial Certification of Trustee
(Initial Mortgage Loans)
EXHIBIT G-2
Form of Interim Certification of Trustee
EXHIBIT G-3
Form of Delay Delivery Certification
EXHIBIT G-4
Form of Initial Certification of Trustee
(Subsequent Mortgage Loans)
iv
<PAGE>
EXHIBIT H
Form of Final Certification of Trustee
EXHIBIT I
Transfer Affidavit for Class A-R Certificates
EXHIBIT J-1
Form of Transferor Certificate for Class A-R
Certificates
EXHIBIT J-2
Form of Transferor Certificate for Private
Certificates
EXHIBIT K
Form of Investment Letter (Non-Rule 144A)
EXHIBIT L
Form of Rule 144A Letter
EXHIBIT M
Form of Request for Document Release
EXHIBIT N
Form of Request for File Release
EXHIBIT O
Copy of Depository Agreement
EXHIBIT P
Form of Subsequent Transfer Agreement
EXHIBIT Q
[Reserved]
EXHIBIT R
[Reserved]
EXHIBIT S-1
[Reserved]
EXHIBIT S-2
[Reserved]
EXHIBIT T
Officer's Certificate with respect to
Prepayments
EXHIBIT U
Form of Swap Contract
EXHIBIT V-1
Form of Swap Contract Assignment Agreement
EXHIBIT V-2
Form of Swap Contract Administration
Agreement
EXHIBIT W
Form of Monthly Statement
EXHIBIT X-1
Form of Performance Certification
(Subservicer)
EXHIBIT X-2
Form of Performance Certification (Trustee)
EXHIBIT Y
Form of Servicing Criteria to be Addressed
in Assessment of Compliance Statement
EXHIBIT Z
List of Item 1119 Parties
EXHIBIT AA
Form of Sarbanes-Oxley Certification
(Replacement Master Servicer)
SCHEDULE I
Prepayment Charge Schedule and Prepayment
Charge Summary
SCHEDULE II
Collateral Schedule
SCHEDULE III
40-Year Target Schedule
v
<PAGE>
POOLING AND SERVICING AGREEMENT, dated as of November 1, 2006,
by
and among CWABS, INC., a Delaware corporation, as depositor (the
"Depositor"),
COUNTRYWIDE HOME LOANS, INC., a New York corporation, as seller
("CHL" or a
"Seller"), PARK MONACO INC., a Delaware corporation, as a seller
("Park
Monaco" or a "Seller"), PARK SIENNA LLC, a Delaware limited
liability company,
as a seller ("Park Sienna" or a "Seller", and together with CHL and
Park
Monaco, the "Sellers"), COUNTRYWIDE HOME LOANS SERVICING LP, a
Texas limited
partnership, as master servicer (the "Master Servicer"), THE BANK
OF NEW YORK,
a New York banking corporation, as trustee (the "Trustee"), and THE
BANK OF
NEW YORK TRUST COMPANY, N.A., a national banking association, as
co-trustee
(the "Co-Trustee").
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby
conveyed
to the Trustee in return for the Certificates. The Trust Fund
(excluding the
Credit Comeback Excess Account, the Carryover Reserve Fund and the
assets held
in the Pre-Funding Account) for federal income tax purposes will
consist of
three REMICs (the "Swap-IO REMIC," the "Strip REMIC" and the
"Master REMIC").
Each Certificate, other than the Class A-R Certificate, will
represent
ownership of one or more regular interests in the Master REMIC for
purposes of
the REMIC Provisions. The Class A-R Certificate represents
ownership of the
sole class of residual interest in the Swap-IO REMIC, the Strip
REMIC and the
Master REMIC. The Master REMIC will hold as assets the several
classes of
uncertificated Strip REMIC Interests (other than the STR-A-R
Interest). Each
Strip REMIC Interest (other than the STR-A-R Interest) is hereby
designated as
a regular interest in the Strip REMIC. The Strip REMIC will hold as
assets the
several classes of uncertificated Swap-IO REMIC Interests (other
than the
SWR-A-R Interest). Each Swap-IO REMIC Interest (other than the
SWR-A-R
Interest) is hereby designated as a regular interest in the Swap-IO
REMIC. The
Swap-IO REMIC will hold as assets all property of the Trust Fund
(excluding
the Credit Comeback Excess Account, the Carryover Reserve Fund and
the assets
held in the Pre-Funding Account). The latest possible maturity date
of all
REMIC regular interests created in this Agreement shall be the
Latest Possible
Maturity Date.
None of the REMICs described herein shall hold any interest in
the
Swap Trust, Swap Contract, Swap Account or Final Maturity Reserve
Trust.
SWAP-IO REMIC:
The Swap-IO REMIC Interests will have the principal balances
and
pass-through rates as set forth below.
<TABLE>
<CAPTION>
Swap-IO REMIC Interest
Initial Principal Balance(1)
Pass-Through Rate
----------------------
-------------------------
-----------------
<S>
<C>
<C>
SWR-1A
$
4,509,200
(2)
SWR-1B
$
4,509,200
(3)
SWR-2A
$
5,477,200
(2)
SWR-2B
$
5,477,200
(3)
SWR-3A
$
6,440,150
(2)
SWR-3B
$
6,440,150
(3)
SWR-4A
$
7,394,250
(2)
1
<PAGE>
Swap-IO REMIC Interest
Initial Principal Balance(1)
Pass-Through Rate
----------------------
-------------------------
-----------------
SWR-4B
$
7,394,250
(3)
SWR-5A
$
8,336,200
(2)
SWR-5B
$
8,336,200
(3)
SWR-6A
$
9,262,200
(2)
SWR-6B
$
9,262,200
(3)
SWR-7A
$ 10,168,200
(2)
SWR-7B
$ 10,168,200
(3)
SWR-8A
$ 11,051,850
(2)
SWR-8B
$ 11,051,850
(3)
SWR-9A
$ 11,909,050
(2)
SWR-9B
$ 11,909,050
(3)
SWR-10A
$ 12,736,350
(2)
SWR-10B
$ 12,736,350
(3)
SWR-11A
$ 13,530,450
(2)
SWR-11B
$ 13,530,450
(3)
SWR-12A
$ 14,289,150
(2)
SWR-12B
$ 14,289,150
(3)
SWR-13A
$ 15,006,100
(2)
SWR-13B
$ 15,006,100
(3)
SWR-14A
$ 15,681,150
(2)
SWR-14B
$ 15,681,150
(3)
SWR-15A
$ 16,311,050
(2)
SWR-15B
$ 16,311,050
(3)
SWR-16A
$ 16,826,800
(2)
SWR-16B
$ 16,826,800
(3)
SWR-17A
$ 17,296,950
(2)
SWR-17B
$ 17,296,950
(3)
SWR-18A
$ 17,712,800
(2)
SWR-18B
$ 17,712,800
(3)
SWR-19A
$ 17,783,250
(2)
SWR-19B
$ 17,783,250
(3)
SWR-20A
$ 17,243,650
(2)
SWR-20B
$ 17,243,650
(3)
SWR-21A
$ 16,720,450
(2)
SWR-21B
$ 16,720,450
(3)
SWR-22A
$ 16,213,100
(2)
SWR-22B
$ 16,213,100
(3)
SWR-23A
$ 15,721,250
(2)
SWR-23B
$ 15,721,250
(3)
SWR-24A
$
304,852,250
(2)
SWR-24B
$
304,852,250
(3)
SWR-25A
$
5,502,700
(2)
SWR-25B
$
5,502,700
(3)
SWR-26A
$
5,350,250
(2)
SWR-26B
$
5,350,250
(3)
2
<PAGE>
Swap-IO REMIC Interest
Initial Principal
Balance(1)
Pass-Through Rate
----------------------
-------------------------
-----------------
SWR-27A
$
5,201,900
(2)
SWR-27B
$
5,201,900
(3)
SWR-28A
$
5,057,750
(2)
SWR-28B
$
5,057,750
(3)
SWR-29A
$
4,917,500
(2)
SWR-29B
$
4,917,500
(3)
SWR-30A
$
4,778,150
(2)
SWR-30B
$
4,778,150
(3)
SWR-31A
$
4,645,650
(2)
SWR-31B
$
4,645,650
(3)
SWR-32A
$
4,517,050
(2)
SWR-32B
$
4,517,050
(3)
SWR-33A
$
4,391,900
(2)
SWR-33B
$
4,391,900
(3)
SWR-34A
$
4,270,300
(2)
SWR-34B
$
4,270,300
(3)
SWR-35A
$
4,152,000
(2)
SWR-35B
$
4,152,000
(3)
SWR-36A
$
4,037,650
(2)
SWR-36B
$
4,037,650
(3)
SWR-37A
$
3,964,550
(2)
SWR-37B
$
3,964,550
(3)
SWR-38A
$
3,852,550
(2)
SWR-38B
$
3,852,550
(3)
SWR-39A
$
3,743,850
(2)
SWR-39B
$
3,743,850
(3)
SWR-40A
$
3,638,150
(2)
SWR-40B
$
3,638,150
(3)
SWR-41A
$
3,535,500
(2)
SWR-41B
$
3,535,500
(2)
SWR-42A
$
3,435,800
(3)
SWR-42B
$
3,435,800
(2)
SWR-43A
$
3,316,700
(3)
SWR-43B
$
3,316,700
(2)
SWR-44A
$
3,224,550
(3)
SWR-44B
$
3,224,550
(2)
SWR-45A
$
3,134,900
(3)
SWR-45B
$
3,134,900
(2)
SWR-46A
$
3,047,750
(3)
SWR-46B
$
3,047,750
(2)
SWR-47A
$
2,962,950
(3)
SWR-47B
$
2,962,950
(2)
SWR-48A
$
2,880,950
(3)
SWR-48B
$
2,880,950
(2)
SWR-49A
$
2,800,800
(3)
3
<PAGE>
Swap-IO REMIC Interest
Initial Principal Balance(1)
Pass-Through Rate
----------------------
-------------------------
-----------------
SWR-49B
$
2,800,800
(2)
SWR-50A
$
2,722,850
(3)
SWR-50B
$
2,722,850
(2)
SWR-51A
$
2,647,100
(3)
SWR-51B
$
2,647,100
(2)
SWR-52A
$
2,573,500
(3)
SWR-52B
$
2,573,500
(2)
SWR-53A
$
2,501,800
(3)
SWR-53B
$
2,501,800
(2)
SWR-54A
$
2,432,200
(3)
SWR-54B
$
2,432,200
(2)
SWR-55A
$
2,364,500
(3)
SWR-55B
$
2,364,500
(2)
SWR-56A
$
2,298,650
(3)
SWR-56B
$
2,298,650
(2)
SWR-57A
$
2,234,650
(3)
SWR-57B
$
2,234,650
(2)
SWR-58A
$
2,172,400
(3)
SWR-58B
$
2,172,400
(2)
SWR-59A
$
2,111,900
(3)
SWR-59B
$
2,111,900
(2)
SWR-60A
$ 14,281,050
(2)
SWR-60B
$ 14,281,050
(3)
SWR-61A
$
1,642,100
(2)
SWR-61B
$
1,642,100
(3)
SWR-62A
$
1,596,600
(2)
SWR-62B
$
1,596,600
(3)
SWR-63A
$
1,552,400
(2)
SWR-63B
$
1,552,400
(3)
SWR-64A
$
1,509,400
(2)
SWR-64B
$
1,509,400
(3)
SWR-65A
$
1,467,600
(2)
SWR-65B
$
1,467,600
(3)
SWR-66A
$
1,426,900
(2)
SWR-66B
$
1,426,900
(3)
SWR-67A
$
1,387,400
(2)
SWR-67B
$
1,387,400
(3)
SWR-68A
$
1,348,950
(2)
SWR-68B
$
1,348,950
(3)
SWR-69A
$
1,311,600
(2)
SWR-69B
$
1,311,600
(3)
SWR-70A
$ 45,581,600
(2)
SWR-70B
$ 45,581,600
(3)
SWR-Support
(4)
(5)
SWR-P
$
100.00
(6)
4
<PAGE>
Swap-IO REMIC Interest
Initial Principal Balance(1)
Pass-Through Rate
----------------------
-------------------------
-----------------
SWR-40 Year
Reserve
(7)
(7)
SW-A-R
(8)
(8)
</TABLE>
---------------------------
(1) Scheduled
principal, prepayments and Realized Losses will be allocated
first, to the SWR-Support Interest and second, to the numbered
classes
sequentially (from lowest to highest). Amounts so allocated to a
numbered
class shall be further allocated among the "A" and "B" components
of such
numbered class pro-rata until the entire class is reduced to
zero.
(2) Prior to the 71st
Distribution Date, a rate equal to twice the Pool Tax
Cap
less 10.20% per annum. On and after the 71st Distribution Date a
rate
equal to the Pool Tax Cap. The "Pool Tax Cap" means the weighted
average
of
the Adjusted Net Mortgage Rates of all the Mortgage Loans. For
this
purpose, beginning on the Distribution Date in December 2016 and
ending
on
the Last Scheduled Distribution Date, the Adjusted Net Mortgage
Rate
shall be determined by first reducing the interest payable on
each
40-Year Mortgage Loan by the 40-Year Reserve Rate.
(3) Prior to the 71st
Distribution Date, a rate equal to the lesser of (i)
10.20% per annum and (ii) twice the Pool Tax Cap. On and after the
71st
Distribution Date, a rate equal to the Pool Tax Cap.
(4) On the Closing
Date and on each Distribution Date, following the
allocation of Principal Amounts and Realized Losses, the
principal
balance in respect of the SWR-Support Interest will equal the
excess of
(a)
the sum of (i) the principal balance of the Mortgage Loans (as of
the
end
of the related Due Period, reduced by principal prepayments
received
after such Due Period that are to be distributed on such
Distribution
Date) and (ii) the amount, if any, on deposit in the Pre-Funding
Account
in
respect of the Mortgage Loans over (b) the principal balance in
respect of the remaining Swap-IO REMIC Interests other than the
SWR-P and
the
SWR-A-R Interests.
(5) A rate equal to
the Pool Tax Cap.
(6) On each
Distribution Date the SWR-P Interest is entitled to all
Prepayment Charges collected with respect to the Mortgage Loans. It
pays
no
interest.
(7) Beginning on the
Distribution Date in December 2016 and ending on the
Distribution in November 2036 (the "Last Scheduled Distribution
Date"),
the
SW-40 Year Reserve Interest shall be entitled to a specific
portion
of
the interest payable on each 40-Year Mortgage Loan. Specifically,
the
SW-40 Year Reserve Interest shall be entitled to a specific portion
of
the
interest payable on the Stated Principal Balance of each
40-Year
Mortgage Loan as of the Due Date in the month preceding the month
of that
Distribution Date (after giving effect to principal prepayments in
the
Prepayment Period related to that prior Due Date) at a per annum
rate
equal to 0.80% (the "40-Year Reserve Rate").
(8) The SW-A-R
Interest is the sole class of residual interest in the Swap-IO
REMIC. It has no principal and pays no principal or interest.
On
each Distribution Date, the Interest Funds and the Principal
Distribution Amount payable with respect to the Mortgage Loans
shall be
payable with respect to the Swap-IO REMIC Interests in the
following manner:
5
<PAGE>
(1)
Interest. Interest is to be distributed with respect to each
Swap-IO
REMIC Interest at the rate, or according to the formulas, described
above.
(2)
Principal. Principal Distribution Amounts shall be allocated
among
the Swap-IO REMIC Interests as described above.
(3)
Prepayment Penalties. All Prepayment Charges are allocated to
the
SWR-P Interest.
STRIP REMIC:
The Strip REMIC Regular Interests will have the principal
balances,
pass-through rates and Corresponding Classes of Certificates as set
forth in
the following table:
<TABLE>
<CAPTION>
------------------------------- ----------------------------
---------------------------- ----------------------------
Strip REMIC
Initial Principal
Pass-Through
Corresponding Class
Interest
Balance
Rate
of Certificates
------------------------------- ----------------------------
---------------------------- ----------------------------
<S>
<C>
<C>
<C>
STR-1-A.......................
(1)
(2)
1-A
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-2-A-1.....................
(1)
(2)
2-A-1
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-2-A-2.....................
(1)
(2)
2-A-2
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-2-A-3.....................
(1)
(2)
2-A-3
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-2-A-4.....................
(1)
(2)
2-A-4
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-1.......................
(1)
(2)
M-1
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-2.......................
(1)
(2)
M-2
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-3.......................
(1)
(2)
M-3
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-4.......................
(1)
(2)
M-4
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-5.......................
(1)
(2)
M-5
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-6.......................
(1)
(2)
M-6
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-7.......................
(1)
(2)
M-7
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-8.......................
(1)
(2)
M-8
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-M-9.......................
(1)
(2)
M-9
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-B.........................
(1)
(2)
B
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-$100......................
$100
(3)
A-R
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-C-OC......................
(4)
(2)
N/A
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-C-Swap-IO
(5)
(5)
N/A
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-C-40 Year IO
(6)
(6)
N/A
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-P.........................
$100
(7)
P
------------------------------- ----------------------------
---------------------------- ----------------------------
STR-A-R.......................
(8)
(8)
N/A
------------------------------- ----------------------------
---------------------------- ----------------------------
</TABLE>
(1) This Strip REMIC Interest has a principal balance that is
initially equal
to 100% of its Corresponding Certificate Class issued by the Master
REMIC.
Principal payments, both scheduled and prepaid, Realized Losses and
Subsequent
Recoveries attributable to the Swap-IO REMIC Interests held by the
Strip REMIC
will be allocated to this class to maintain its size relative to
its
Corresponding Certificate Class.
(2) On each Distribution Date, the pass-through rate for this Strip
REMIC
Interest will be the "Strip REMIC Cap," which will equal the
weighted average
of the pass-through rates of the Swap-IO REMIC Interests (other
than the
SWR-P, SWR-40 Year Reserve and SWR-A-R Interests) treating each "B"
Interest
the cardinal number of which (for example, SW-1B, SW-2B,
6
<PAGE>
SW-3B, etc.) is not less than the ordinal number of the
Distribution Date
(first Distribution Date, second Distribution Date, third
Distribution Date,
etc.) as capped at a rate equal to the product of (i) 2 and (ii)
LIBOR.
(3) This Strip REMIC Interest pays no interest.
(4) This Strip REMIC Interest has a principal balance that is
initially equal
to 100% of the Overcollateralized Amount. Principal payments, both
scheduled
and prepaid, Realized Losses and Subsequent Recoveries attributable
to the
Swap-IO REMIC Interests held by the Strip REMIC will be allocated
to this
class to maintain its size relative to the Overcollateralized
Amount.
(5) For each Distribution Date, the STR-C-Swap-IO Interest is
entitled to
receive from each Swap REMIC "B" Interest the cardinal number of
which (for
example, SW-1B, SW-2B, SW-3B, etc.) is not less than the ordinal
number of the
Distribution Date (first Distribution Date, second Distribution
Date, third
Distribution Date, etc. ) the interest accruing on such interest in
excess of
a per annum rate equal to the product of (i) 2 and (ii) LIBOR.
(6) The STR-C-40 Year IO is entitled to all amounts payable with
respect to
the SWR-40 Year Reserve Interest.
(7) The STR-P Interest is entitled to all amounts payable with
respect to the
SWR-P Interest. It pays no interest.
(8) The STR-A-R Interest is the sole class of residual interest in
the Strip
REMIC. It has no principal balance and pays no principal or
interest.
On
each Distribution Date, the Interest Funds and the Principal
Distribution Amount payable with respect to the Swap-IO Interests
shall be
payable with respect to the Strip REMIC Interests in the following
manner:
(1)
Interest. Interest is to be distributed with respect to each
Strip
REMIC Interest at the rate, or according to the formulas, described
above.
(2)
Principal. Principal Distribution Amounts shall be allocated
among
the Strip REMIC Interests as described above.
(3)
Prepayment Penalties. All Prepayment Charges are allocated to
the
STR-P Interest.
7
<PAGE>
MASTER REMIC:
The following table specifies the class designation, interest
rate,
and principal amount for each class of Master REMIC Interest:
<TABLE>
<CAPTION>
Original Certificate
Class
Principal Balance
Pass-Through Rate
-------------------------------------------------
--------------------------- -----------------------
<S>
<C>
<C>
Class 1-A.......................................
$465,514,000
(1)
Class 2-A-1.....................................
$361,543,000
(1)
Class 2-A-2.....................................
$99,267,000
(1)
Class 2-A-3.....................................
$267,045,000
(1)
Class-2-A-4.................................
$104,231,000
(1)
Class M-1.......................................
$59,202,000
(1)
Class M-2.......................................
$38,399,000
(1)
Class M-3.......................................
$34,399,000
(1)
Class M-4.......................................
$34,400,000
(1)
Class M-5.......................................
$24,000,000
(1)
Class M-6.......................................
$17,600,000
(1)
Class M-7.......................................
$18,400,000
(1)
Class M-8.......................................
$12,800,000
(1)
Class M-9.......................................
$16,800,000
(1)
Class B.........................................
$18,400,000
(1)
Class C.........................................
(2)
(3)
Class P.........................................
$100
(4)
Class A-R.......................................
$100
(5)
</TABLE>
(1) The Certificates
will accrue interest at the related Pass-Through Rates
identified in this Agreement. For federal income tax purposes,
including
the
computation of the Class C Distributable Amount and entitlement
to
Net
Rate Carryover the pass-through rate in respect of each Class
1-A
Certificate, Class 2-A Certificate, Class M Certificate and Class
B
Certificate will be subject to a cap equal to the Strip REMIC Cap
rather
than
its applicable Net Rate Cap.
(2) For federal income
tax purposes, the Class C Certificates will be treated
as
having a Certificate Principal Balance equal to the
Overcollateralized
Amount.
(3) For each Interest
Accrual Period the Class C Certificates are entitled to
an
amount (the "Class C Distributable Amount") equal to the sum of
(a)
the
interest payable on the STR-C-Swap-IO Interest, (b) the
interest
payable on the STR-C-OC Interest (c) the interest payable on the
STR-C-40
Year
IO and (d) a specified portion of the interest payable on the
Strip
REMIC Regular Interests (other than the STR-$100, STR-C-OC,
STR-C-Swap-IO, STR-C-40 Year IO and STR-P Interests) equal to the
excess
of
the Strip REMIC Cap over the weighted average interest rate of
the
Strip REMIC Regular Interests (other than the STR-$100,
STR-C-OC,
STR-C-Swap-IO, STR-C-40 Year IO and STR-P Interests) with each such
Class
subject to a cap equal to the Pass-Through Rate of the
Corresponding
Master REMIC Class. The Pass-Through Rate of the Class C
Certificates
shall be a rate sufficient to entitle it to an amount equal to
all
interest accrued on the Mortgage Loans less the interest accrued on
the
other interests issued by the Master REMIC. The Class C
Distributable
Amount for any Distribution Date is payable from
8
<PAGE>
current interest on the Mortgage Loans and any related
Overcollateralization Reduction Amount for that Distribution
Date.
(4) For each
Distribution Date the Class P Certificates are entitled to all
Prepayment Charges distributed with respect to the STR-P
Interest.
(5) The Class A-R
Certificates represent the sole class of residual interest
in
each REMIC created hereunder. The Class A-R Certificates are
not
entitled to distributions of interest.
The foregoing REMIC structure is intended to cause all of the
cash
from the Mortgage Loans to flow through to the Master REMIC as cash
flow on
REMIC regular interests, without creating any shortfall--actual or
potential
(other than for credit losses)-- to any REMIC regular interest. It
is not
intended that the Class A-R Certificates be entitled to any cash
flows
pursuant to this Agreement except as provided in Section 3.08(a)
hereunder.
9
<PAGE>
ARTICLE I.
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement, the following words and
phrases,
unless the context otherwise requires, shall have the following
meanings:
40-Year Target Schedule: Schedule III hereto.
40-Year Mortgage Loan: A Mortgage Loan with an original term to
maturity of 40 years.
40-Year Reserve Rate: As defined in the Preliminary Statement.
Acceptable Bid Amount: Either (i) a bid equal to or greater than
the
Minimum Auction Amount or (ii) the highest bid submitted by a
Qualified Bidder
in an auction if the Directing Certificateholder agrees to pay the
related
Auction Supplement Amount.
Account: Any Escrow Account, the Carryover Reserve Fund, the
Certificate Account, the Credit Comeback Excess Account, the
Distribution
Account, the Pre-Funding Account, the Principal Reserve Fund, the
Swap
Account, the Final Maturity Reserve Fund or any other account
related to the
Trust Fund or the Mortgage Loans.
Accrual Period: With respect to any Distribution Date and each
Class
of Interest-Bearing Certificates, the period commencing on the
immediately
preceding Distribution Date (or, in the case of the first
Distribution Date,
the Closing Date) and ending on the day immediately preceding
such
Distribution Date. With respect to any Distribution Date and the
Class C
Certificates, the calendar month preceding the month in which
such
Distribution Date occurs. All calculations of interest on the
Interest-Bearing
Certificates will be made on the basis of the actual number of days
elapsed in
the related Accrual Period and on a 360-day year. All calculations
of interest
on the Class C Certificates will be made on the basis of a 360-day
year
consisting of twelve 30-day months.
Additional Designated Information: As defined in Section 11.02.
Adjustable Rate Mortgage Loans: The Mortgage Loans identified in
the
Mortgage Loan Schedule as having a Mortgage Rate which is
adjustable in
accordance with the terms of the related Mortgage Note.
Adjusted Net Mortgage Rate: As to each Mortgage Loan, the
Mortgage
Rate less the related Expense Fee Rate.
Adjusted Replacement Upfront Amount: As defined in Section
3.21.
Adjustment Date: As to each Adjustable Rate Mortgage Loan, each
date
on which the related Mortgage Rate is subject to adjustment, as
provided in
the related Mortgage Note.
10
<PAGE>
Advance: The aggregate of the advances required to be made by
the
Master Servicer with respect to any Distribution Date pursuant to
Section
4.01, the amount of any such advances being equal to the aggregate
of payments
of principal of, and interest on the Stated Principal Balance of,
the Mortgage
Loans (net of the Servicing Fees) that were due on the related Due
Date and
not received by the Master Servicer as of the close of business on
the related
Determination Date including an amount equivalent to interest on
the Stated
Principal Balance of each Mortgage Loan as to which the related
Mortgaged
Property is an REO Property or as to which the related Mortgaged
Property has
been liquidated but such Mortgage Loan has not yet become a
Liquidated
Mortgage Loan; provided, however, that the net monthly rental
income (if any)
from such REO Property deposited in the Certificate Account for
such
Distribution Date pursuant to Section 3.12 may be used to offset
such Advance
for the related REO Property; provided, further, that for the
avoidance of
doubt, no Advances shall be required to be made in respect of any
Liquidated
Mortgage Loan.
Agreement: This Pooling and Servicing Agreement and any and all
amendments or supplements hereto made in accordance with the terms
herein.
Amount Held for Future Distribution: As to any Distribution
Date,
the aggregate amount held in the Certificate Account at the close
of business
on the immediately preceding Determination Date on account of (i)
all
Scheduled Payments or portions thereof received in respect of the
Mortgage
Loans due after the related Due Date, (ii) Principal Prepayments
received in
respect of such Mortgage Loans after the last day of the related
Prepayment
Period and (iii) Liquidation Proceeds and Subsequent Recoveries
received in
respect of such Mortgage Loans after the last day of the related
Due Period.
Applied Realized Loss Amount: With respect to any Distribution
Date
and any Loan Group or Loan Groups, the amount, if any, by which,
the aggregate
Certificate Principal Balance of the Class(es) of Certificates
listed opposite
such Loan Group(s) in the following table (after all distributions
of
principal on such Distribution Date) exceeds the sum of (x) the
aggregate
Stated Principal Balance of the Mortgage Loans in such Loan
Group(s) for such
Distribution Date and (y) the amount on deposit in the Pre-Funding
Account in
respect of such Loan Group(s); provided, however, that an Applied
Realized
Loss Amount will not exist for a Class of Class A Certificates
unless the
Certificate Principal Balances of the Subordinate Certificates have
been
reduced to zero.
Loan Group(s)
Class(es) of Certificates
1 and 2
Interest-Bearing
1
1-A
2
2-A
Appraised Value: The appraised value of the Mortgaged Property
based
upon the appraisal made for the originator of the related Mortgage
Loan by an
independent fee appraiser at the time of the origination of the
related
Mortgage Loan, or the sales price of the Mortgaged Property at the
time of
such origination, whichever is less, or with respect to any
Mortgage Loan
originated in connection with a refinancing, the appraised value of
the
Mortgaged Property based upon the appraisal made at the time of
such
refinancing.
11
<PAGE>
Auction Supplement Amount: As defined in Section 9.04(c).
Bankruptcy Code: Title 11 of the United States Code.
Bid Determination Date: As defined in Section 9.04(b).
Book-Entry Certificates: Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the
ownership of
which is reflected on the books of the Depository or on the books
of a person
maintaining an account with the Depository (directly, as a
"Depository
Participant", or indirectly, as an indirect participant in
accordance with the
rules of the Depository and as described in Section 5.06). As of
the Closing
Date, each Class of Interest-Bearing Certificates (other than the
Class B
Certificates) constitutes a Class of Book-Entry Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday or
(ii)
a day on which banking institutions in the State of New York or
California or
the city in which the Corporate Trust Office of the Trustee is
located are
authorized or obligated by law or executive order to be closed.
Carryover Reserve Fund: The separate Eligible Account created
and
initially maintained by the Trustee pursuant to Section 4.07 in the
name of
the Trustee for the benefit of the Certificateholders and
designated "The Bank
of New York in trust for registered Holders of CWABS, Inc.,
Asset-Backed
Certificates, Series 2006-23". Funds in the Carryover Reserve Fund
shall be
held in trust for the Certificateholders for the uses and purposes
set forth
in this Agreement.
Certificate: Any one of the certificates of any Class executed
and
authenticated by the Trustee in substantially the forms attached
hereto as
Exhibits A-1 through A-15, Exhibit B, Exhibit C, Exhibit D and
Exhibit E.
Certificate Account: The separate Eligible Account created and
initially maintained by the Master Servicer pursuant to Section
3.05(b) with a
depository institution in the name of the Master Servicer for the
benefit of
the Trustee on behalf of the Certificateholders and designated
"Countrywide
Home Loans Servicing LP in trust for registered Holders of CWABS,
Inc.,
Asset-Backed Certificates, Series 2006-23". Funds in the
Certificate Account
shall be held in trust for the Certificateholders for the uses and
purposes
set forth in this Agreement.
Certificate Owner: With respect to a Book-Entry Certificate,
the
person that is the beneficial owner of such Book-Entry
Certificate.
Certificate Principal Balance: As to any Certificate (other than
the
Class C Certificates) and as of any Distribution Date, the Initial
Certificate
Principal Balance of such Certificate (A) less the sum of (i) all
amounts
distributed with respect to such Certificate in reduction of the
Certificate
Principal Balance thereof on previous Distribution Dates pursuant
to Section
4.04(b) and (ii) any Applied Realized Loss Amounts allocated to
such
Certificate on previous Distribution Dates pursuant to Section
4.04(g), and
(B) increased by any Subsequent Recoveries allocated to such
Certificate
pursuant to Section 4.04(h) on such Distribution Date. References
herein to
the Certificate Principal Balance of a Class of Certificates shall
mean the
12
<PAGE>
Certificate Principal Balances of all Certificates in such Class.
The Class C
Certificates do not have a Certificate Principal Balance. With
respect to any
Certificate (other than the Class C Certificates) of a Class and
any
Distribution Date, the portion of the Certificate Principal Balance
of such
Class represented by such Certificate equal to the product of the
Percentage
Interest evidenced by such Certificate and the Certificate
Principal Balance
of such Class.
Certificate Register: The register maintained pursuant to
Section
5.02 hereof.
Certificateholder or Holder: The person in whose name a
Certificate
is registered in the Certificate Register (initially, Cede &
Co., as nominee
for the Depository, in the case of any Class of Book-Entry
Certificates),
except that solely for the purpose of giving any consent pursuant
to this
Agreement, any Certificate registered in the name of the Depositor
or any
affiliate of the Depositor shall be deemed not to be Outstanding
and the
Voting Interest evidenced thereby shall not be taken into account
in
determining whether the requisite amount of Voting Interests
necessary to
effect such consent has been obtained; provided that if any such
Person
(including the Depositor) owns 100% of the Voting Interests
evidenced by a
Class of Certificates, such Certificates shall be deemed to be
Outstanding for
purposes of any provision hereof (other than the second sentence of
Section
10.01 hereof) that requires the consent of the Holders of
Certificates of a
particular Class as a condition to the taking of any action
hereunder. The
Trustee is entitled to rely conclusively on a certification of the
Depositor
or any affiliate of the Depositor in determining which Certificates
are
registered in the name of an affiliate of the Depositor.
Certification Party: As defined in Section 11.05.
Certifying Person: As defined in Section 11.05.
CHL: Countrywide Home Loans, Inc., a New York corporation, and
its
successors and assigns.
CHL Mortgage Loans: The Mortgage Loans identified as such on
the
Mortgage Loan Schedule for which CHL is the applicable Seller.
Class: All Certificates bearing the same Class designation as
set
forth in Section 5.01 hereof.
Class 1-A Certificate: Any Certificate designated as a "Class
1-A
Certificate" on the face thereof, in the form of Exhibit A-1
hereto,
representing the right to distributions as set forth herein.
Class 1-A Net Rate Cap: For any Distribution Date, the weighted
average Adjusted Net Mortgage Rate of the Mortgage Loans in Loan
Group 1 as of
the first day of the related Due Period (after giving effect to
Principal
Prepayments received during the Prepayment Period that ends during
such Due
Period), adjusted to an effective rate reflecting the calculation
of interest
on the basis of the actual number of days elapsed during the
related Accrual
Period and a 360-day year, minus a fraction, expressed as a
percentage, the
numerator of which is (a) the product of (x) the sum of (1) the sum
of the Net
Swap Payment payable to the Swap Counterparty with respect to
such
Distribution Date and the Final Maturity Reserve Deposit for
13
<PAGE>
such Distribution Date times a fraction, the numerator of which is
equal to
360 and the denominator of which is equal to the actual number of
days in the
related Accrual Period and (2) any Swap Termination Payment payable
to the
Swap Counterparty for such Distribution Date (other than a Swap
Termination
Payment due to a Swap Counterparty Trigger Event) and (y) a
fraction, the
numerator of which is the Interest Funds for Loan Group 1 for
such
Distribution Date, and the denominator of which is the Interest
Funds for Loan
Group 1 and Loan Group 2 for such Distribution Date, and the
denominator of
which is (b) the sum of the aggregate Stated Principal Balance of
the Mortgage
Loans in Loan Group 1 as of the first day of the related Due Period
(after
giving effect to Principal Prepayments received during the
Prepayment Period
that ends during such Due Period) plus any amounts on deposit in
the
Pre-Funding Account in respect of Loan Group 1 as of the first day
of that Due
Period.
Class 1-A Principal Distribution Amount: With respect to any
Distribution Date, the product of (x) the Class A Principal
Distribution
Target Amount and (y) a fraction, the numerator of which is the
Principal
Remittance Amount for Loan Group 1 and the denominator of which is
the
Principal Remittance Amount for both Loan Groups.
Class 2-A-1 Certificate: Any Certificate designated as a "Class
2-A-1 Certificate" on the face thereof, in the form of Exhibit A-2
hereto,
representing the right to distributions as set forth herein.
Class 2-A-2 Certificate: Any Certificate designated as a "Class
2-A-2 Certificate" on the face thereof, in the form of Exhibit A-3
hereto,
representing the right to distributions as set forth herein.
Class 2-A-3 Certificate: Any Certificate designated as a "Class
2-A-3 Certificate" on the face thereof, in the form of Exhibit A-4
hereto,
representing the right to distributions as set forth herein.
Class 2-A-4 Certificate: Any Certificate designated as a "Class
2-A-4 Certificate" on the face thereof, in the form of Exhibit A-5
hereto,
representing the right to distributions as set forth herein.
Class 2-A Certificate: Any Class 2-A-1, Class 2-A-2, Class 2-A-3
or
Class 2-A-4 Certificate.
Class 2-A Net Rate Cap: For any Distribution Date, the weighted
average Adjusted Net Mortgage Rate of the Mortgage Loans in Loan
Group 2 as of
the first day of the related Due Period (after giving effect to
Principal
Prepayments received during the Prepayment Period that ends during
such Due
Period), adjusted to an effective rate reflecting the calculation
of interest
on the basis of the actual number of days elapsed during the
related Accrual
Period and a 360-day year, minus a fraction, expressed as a
percentage, the
numerator of which is (a) the product of (x) the sum of (1) the sum
of the Net
Swap Payment payable to the Swap Counterparty with respect to
such
Distribution Date and the Final Maturity Reserve Deposit for such
Distribution
Date times a fraction, the numerator of which is equal to 360 and
the
denominator of which is equal to the actual number of days in the
related
Accrual Period and (2) any Swap Termination Payment payable to the
Swap
Counterparty for such Distribution Date
14
<PAGE>
(other than a Swap Termination Payment due to a Swap Counterparty
Trigger
Event) and (y) a fraction, the numerator of which is the Interest
Funds for
Loan Group 2 for such Distribution Date, and the denominator of
which is the
Interest Funds for Loan Group 1 and Loan Group 2 for such
Distribution Date,
and the denominator of which is (b) the sum of the aggregate Stated
Principal
Balance of the Mortgage Loans in Loan Group 2 as of the first day
of the
related Due Period (after giving effect to Principal Prepayments
received
during the Prepayment Period that ends during such Due Period) plus
any
amounts on deposit in the Pre-Funding Account in respect of Loan
Group 2 as of
the first day of that Due Period.
Class 2-A Principal Distribution Amount: With respect to any
Distribution Date, the product of (x) the Class A Principal
Distribution
Target Amount and (y) a fraction, the numerator of which is the
Principal
Remittance Amount for Loan Group 2 and the denominator of which is
the
Principal Remittance Amount for both Loan Groups.
Class A-R Certificate: Any Certificate designated as a "Class
A-R
Certificate" on the face thereof, in the form of Exhibit D hereto
or, in the
case of the Tax Matters Person Certificate, Exhibit E hereto, in
either case
representing the right to distributions as set forth herein.
Class A Certificate: Any Class 1-A or Class 2-A Certificate.
Class A Principal
Distribution Target Amount: With respect to any
Distribution Date, the excess of (1) the aggregate Certificate
Principal
Balance of the Class A Certificates immediately prior to such
Distribution
Date, over (2) the lesser of (x) 62.20% of the aggregate Stated
Principal
Balance of the Mortgage Loans for such Distribution Date and (y)
the aggregate
Stated Principal Balance of the Mortgage Loans for such
Distribution Date
minus the OC Floor.
Class B Certificate: Any Certificate designated as a "Class B
Certificate" on the face thereof, in the form of Exhibit A-15
hereto,
representing the right to distributions as set forth herein.
Class C Certificate: Any Certificate designated as a "Class C
Certificate" on the face thereof, in the form of Exhibit C
hereto,
representing the right to distributions as set forth herein.
Class C Distributable Amount: As defined in the Preliminary
Statement.
Class M-1 Certificate: Any Certificate designated as a "Class
M-1
Certificate" on the face thereof, in the form of Exhibit A-6
hereto,
representing the right to distributions as set forth herein.
Class M-2 Certificate: Any Certificate designated as a "Class
M-2
Certificate" on the face thereof, in the form of Exhibit A-7
hereto,
representing the right to distributions as set forth herein.
Class M-3 Certificate: Any Certificate designated as a "Class
M-3
Certificate" on the face thereof, in the form of Exhibit A-8
hereto,
representing the right to distributions as set forth herein.
15
<PAGE>
Class M-4 Certificate: Any Certificate designated as a "Class
M-4
Certificate" on the face thereof, in the form of Exhibit A-9
hereto,
representing the right to distributions as set forth herein.
Class M-5 Certificate: Any Certificate designated as a "Class
M-5
Certificate" on the face thereof, in the form of Exhibit A-10
hereto,
representing the right to distributions as set forth herein.
Class M-6 Certificate: Any Certificate designated as a "Class
M-6
Certificate" on the face thereof, in the form of Exhibit A-11
hereto,
representing the right to distributions as set forth herein.
Class M-7 Certificate: Any Certificate designated as a "Class
M-7
Certificate" on the face thereof, in the form of Exhibit A-12
hereto,
representing the right to distributions as set forth herein.
Class M-8 Certificate: Any Certificate designated as a "Class
M-8
Certificate" on the face thereof, in the form of Exhibit A-13
hereto,
representing the right to distributions as set forth herein.
Class M-9 Certificate: Any Certificate designated as a "Class
M-9
Certificate" on the face thereof, in the form of Exhibit A-14
hereto,
representing the right to distributions as set forth herein.
Class P Certificate: Any Certificate designated as a "Class P
Certificate" on the face thereof, in the form of Exhibit B
hereto,
representing the right to distributions as set forth herein.
Class P Principal Distribution Date: The first Distribution
Date
that occurs after the end of the latest Prepayment Charge Period
for all
Mortgage Loans that have a Prepayment Charge Period.
Closing Date: December 8, 2006.
Code: The Internal Revenue Code of 1986, including any successor
or
amendatory provisions.
Collateral Schedule: Schedule II hereto.
Combined Class M-1, M-2 and M-3 Principal Distribution Amount:
With
respect to any Distribution Date, the excess of (1) the sum of (a)
the
aggregate Certificate Principal Balance of the Class A Certificates
(after
taking into account distribution of the Class 1-A Principal
Distribution
Amount and Class 2-A Principal Distribution Amount for such
Distribution Date)
and (b) the aggregate Certificate Principal Balance of the Class
M-1, Class
M-2 and Class M-3 Certificates immediately prior to the
Distribution Date over
(2) the lesser of (a) 78.70% of the aggregate Stated Principal
Balance of the
Mortgage Loans for the Distribution Date and (b) the aggregate
Stated
Principal Balance of the Mortgage Loans for the Distribution Date
minus the OC
Floor; provided, however, that if the Class M-1, Class M-2 and/or
Class M-3
16
<PAGE>
Certificates are the only Classes of Subordinate Certificates
outstanding on
such Distribution Date, those Classes will be entitled to receive
the entire
remaining Principal Distribution Amount for Loan Group 1 and Loan
Group 2
until the Certificate Principal Balances thereof are reduced to
zero.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest: With respect to each Loan Group and any
Distribution Date, an amount equal to, in that Loan Group, the
lesser of (x)
one-half of the Servicing Fee for the related Due Period and (y)
the aggregate
Prepayment Interest Shortfalls for the Mortgage Loans in that Loan
Group for
such Distribution Date.
Confirmation: The confirmation, reference number FXCWL0623, with
a
trade date of November 22, 2006 evidencing a transaction between
the Swap
Counterparty and CHL relating to the Swap Contract.
Corporate Trust Office: The designated office of the Trustee in
the
State of New York where at any particular time its corporate trust
business
with respect to this Agreement shall be administered, which office
at the date
of the execution of this Agreement is located at 101 Barclay
Street, New York,
New York 10286 (Attention: Corporate Trust MBS Administration),
telephone:
(212) 815-3236, facsimile: (212) 815-3986.
Co-Trustee: The Bank of New York Trust Company, N.A., a
national
banking association, not in its individual capacity, but solely in
its
capacity as co-trustee for the benefit of the Certificateholders
under this
Agreement, and any successor thereto, and any corporation or
national banking
association resulting from or surviving any consolidation or merger
to which
it or its successors may be a party.
Covered Mortgage Loan: A Mortgage Loan listed on the Mortgage
Loan
Schedule as being covered by a Mortgage Insurance Policy.
Credit Bureau Risk Score: A statistical credit score obtained by
CHL
in connection with the origination of a Mortgage Loan.
Credit Comeback Excess Account: The separate Eligible Account
created and initially maintained by the Trustee pursuant to Section
4.08 in
the name of the Trustee for the benefit of the Certificateholders
and
designated "The Bank of New York in trust for registered Holders of
CWABS,
Inc., Asset-Backed Certificates, Series 2006-23". Funds in the
Credit Comeback
Excess Account shall be held in trust for the Certificateholders
for the uses
and purposes set forth in this Agreement.
Credit Comeback Excess Amount: With respect to the Credit
Comeback
Loans in any Loan Group and any Master Servicer Advance Date, the
portion of
the sum of the following (without duplication) attributable to the
excess, if
any, of the actual mortgage rate on each Credit Comeback Loan in
such Loan
Group and the Mortgage Rate on such Credit Comeback Loan: (i) all
scheduled
interest collected during the related Due Period with respect to
the Credit
Comeback Loans in such Loan Group, (ii) all interest on prepayments
received
during the related Prepayment Period with respect to the Credit
Comeback Loans
in such Loan Group, other than
17
<PAGE>
Prepayment Interest Excess, (iii) all Advances relating to interest
with
respect to the Credit Comeback Loans in such Loan Group, (iv) all
Compensating
Interest with respect to the Credit Comeback Loans in such Loan
Group and (v)
Liquidation Proceeds with respect to the Credit Comeback Loans in
such Loan
Group collected during the related Due Period (to the extent such
Liquidation
Proceeds relate to interest), less all Nonrecoverable Advances for
such Loan
Group relating to interest reimbursed during the related Due
Period.
Credit Comeback Excess Cashflow: With respect to any
Distribution
Date, any amounts in the Credit Comeback Excess Account available
for such
Distribution Date.
Credit Comeback Loan: Any Fixed Rate Mortgage Loan for which
the
related Mortgage Rate is subject to reduction (not exceeding 0.375%
per annum)
for good payment history of Scheduled Payments by the related
Mortgagor.
Cumulative Loss Trigger Event: With respect to a Distribution
Date
on or after the Stepdown Date, a Cumulative Loss Trigger Event will
be in
effect if (x) the aggregate amount of Realized Losses on the
Mortgage Loans
from the Cut-off Date for each such Mortgage Loan to (and
including) the last
day of the related Due Period (reduced by the aggregate amount of
any
Subsequent Recoveries received through the last day of that Due
Period)
exceeds (y) the applicable percentage, for such Distribution Date,
of the sum
of the aggregate Cut-off Date Principal Balance of the Initial
Mortgage Loans
and the Pre-Funded Amount, as set forth below:
<TABLE>
<CAPTION>
Distribution Date
Percentage
-----------------
----------
<S>
<C>
December 2008 -- November 2009
1.00% with respect to December 2008, plus
an additional 1/12th of 1.25% for each
month thereafter through November 2009
December 2009 -- November 2010
2.25% with respect to December 2009, plus
an additional 1/12th of 1.40% for each
month thereafter through November 2010
December 2010 -- November 2011
3.65% with respect to December 2010, plus
an additional 1/12th of 1.10% for each
month thereafter through November 2011
December 2011 -- November 2012
4.75% with respect to December 2011, plus
an additional 1/12th of 0.70% for each
month thereafter through November 2012
December 2012 -- November 2013
5.45% with respect to December 2012, plus
an additional 1/12th of 0.05% for each
month thereafter through November 2013
December 2013 and thereafter
5.50%
</TABLE>
18
<PAGE>
Current Interest: With respect to each Class of
Interest-Bearing
Certificates and each Distribution Date, the interest accrued at
the
applicable Pass-Through Rate for the applicable Accrual Period on
the
Certificate Principal Balance of such Class immediately prior to
such
Distribution Date.
Cut-off Date: When used with respect to any Mortgage Loan the
"Cut-off Date" shall mean the Initial Cut-off Date or the related
Subsequent
Cut-off Date, as the case may be.
Cut-off Date Principal Balance: As to any Mortgage Loan, the
unpaid
principal balance thereof as of the close of business on the
Cut-off Date
after application of all payments of principal due on or prior to
the Cut-off
Date, whether or not received, and all Principal Prepayments
received on or
prior to the Cut-off Date, but without giving effect to any
installments of
principal received in respect of Due Dates after the Cut-off
Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding
under the
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan
that became
final and non-appealable, except such a reduction resulting from a
Deficient
Valuation or any other reduction that results in a permanent
forgiveness of
principal.
Deficient Valuation: With respect to any Mortgage Loan, a
valuation
by a court of competent jurisdiction of the Mortgaged Property in
an amount
less than the then outstanding indebtedness under such Mortgage
Loan, or any
reduction in the amount of principal to be paid in connection with
any
Scheduled Payment that results in a permanent forgiveness of
principal, which
valuation or reduction results from an order of such court that is
final and
non-appealable in a proceeding under the Bankruptcy Code.
Definitive Certificates: As defined in Section 5.06.
Delay Delivery Mortgage Loans: (i) The Initial Mortgage Loans
identified on the schedule of Mortgage Loans hereto set forth on
Exhibit F-2
hereof for which all or a portion of a related Mortgage File is not
delivered
to the Co-Trustee on or prior to the Closing Date, and (ii) the
Subsequent
Mortgage Loans identified on the schedule of Subsequent Mortgage
Loans set
forth in Annex A to each related Subsequent Transfer Agreement for
which all
or a portion of the related Mortgage File is not delivered to the
Co-Trustee
on or prior to the related Subsequent Transfer Date. The Depositor
shall
deliver (or cause delivery of) the Mortgage Files to the
Co-Trustee: (A) with
respect to at least 50% of the Initial Mortgage Loans in each Loan
Group, not
later than the Closing Date and with respect to at least 10% of the
Subsequent
Mortgage Loans in each Loan Group conveyed on a Subsequent Transfer
Date, not
later than such Subsequent Transfer Date, (B) with respect to at
least an
additional 40% of the Initial Mortgage Loans in each Loan Group,
not later
than 20 days after the Closing Date, and not later than 20 days
after the
relevant Subsequent Transfer Date with respect to the remaining
Subsequent
Mortgage Loans conveyed on such Subsequent Transfer Date, and (C)
with respect
to the remaining Initial Mortgage Loans, not later than thirty days
after the
Closing Date. To the extent that Countrywide Home Loans, Inc. shall
be in
possession of any Mortgage Files with respect to any Delay Delivery
Mortgage
Loan, until delivery of such Mortgage File to the Co-Trustee as
19
<PAGE>
provided in Section 2.01, Countrywide Home Loans, Inc. shall hold
such files
as agent and in trust for the Co-Trustee.
Deleted Mortgage Loan: A Mortgage Loan replaced or to be replaced
by
a Replacement Mortgage Loan.
Delinquency Trigger Event: With respect to any Distribution Date
on
or after the Stepdown Date, a Delinquency Trigger Event will be in
effect if
the Rolling Sixty-Day Delinquency Rate for Outstanding Mortgage
Loans equals
or exceeds the product of (x) the Senior Enhancement Percentage for
such
Distribution Date and (y) the applicable percentage listed below
for the most
senior Class of Interest-Bearing Certificates:
Class
Percentage
A.....................
42.33%
M-1...................
52.63%
M-2...................
62.50%
M-3...................
75.12%
M-4...................
94.12%
M-5...................
114.29%
M-6...................
135.59%
M-7...................
168.42%
M-8...................
202.53%
M-9...................
275.86%
B.....................
457.14%
Denomination: With respect to each Certificate, the amount set
forth
on the face thereof as the "Initial Certificate Balance of this
Certificate"
or, if not the foregoing, the Percentage Interest appearing on the
face
thereof, as applicable.
Depositor: CWABS, Inc., a Delaware corporation, or its successor
in
interest.
Depository: The initial Depository shall be The Depository
Trust
Company, the nominee of which is Cede & Co., or any other
organization
registered as a "clearing agency" pursuant to Section 17A of the
Securities
Exchange Act of 1934, as amended. The Depository shall initially be
the
registered Holder of the Book-Entry Certificates. The Depository
shall at all
times be a "clearing corporation" as defined in Section 8-102(a)(5)
of the
Uniform Commercial Code of the State of New York.
Depository Agreement: With respect to the Book-Entry
Certificates,
the agreement among the Depositor and the initial Depository, dated
as of the
Closing Date, substantially in the form of Exhibit O.
Depository Participant: A broker, dealer, bank or other
financial
institution or other person for whom from time to time a Depository
effects
book-entry transfers and pledges of securities deposited with the
Depository.
20
<PAGE>
Determination Date: With respect to any Distribution Date, the
15th
day of the month of such Distribution Date or, if such 15th day is
not a
Business Day, the immediately preceding Business Day.
Directing Certificateholder: As defined in Section 9.04(a).
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05(c) in the name
of the
Trustee for the benefit of the Certificateholders and designated
"The Bank of
New York, in trust for registered Holders of CWABS, Inc.,
Asset-Backed
Certificates, Series 2006-23". Funds in the Distribution Account
shall be held
in trust for the Certificateholders for the uses and purposes set
forth in
this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
1:00
p.m. Pacific time on the Business Day immediately preceding such
Distribution
Date.
Distribution Date: The 25th day of each month, or if such day is
not
a Business Day, on the first Business Day thereafter, commencing in
December
2006.
Due Date: With respect to any Mortgage Loan and Due Period, the
due
date for Scheduled Payments of interest and/or principal on that
Mortgage Loan
occurring in such Due Period as provided in the related Mortgage
Note.
Due Period: With respect to any Distribution Date, the period
beginning on the second day of the calendar month preceding the
calendar month
in which such Distribution Date occurs and ending on the first day
of the
month in which such Distribution Date occurs.
EDGAR: The Commission's Electronic Data Gathering, Analysis and
Retrieval system.
Eligible Account: Any of (i) an account or accounts maintained
with
a federal or state chartered depository institution or trust
company, the
long-term unsecured debt obligations and short-term unsecured debt
obligations
of which (or, in the case of a depository institution or trust
company that is
the principal subsidiary of a holding company, the debt obligations
of such
holding company, if Moody's is not a Rating Agency) are rated by
each Rating
Agency in one of its two highest long-term and its highest
short-term rating
categories respectively, at the time any amounts are held on
deposit therein,
or (ii) an account or accounts in a depository institution or trust
company in
which such accounts are insured by the FDIC (to the limits
established by the
FDIC) and the uninsured deposits in which accounts are otherwise
secured such
that, as evidenced by an Opinion of Counsel delivered to the
Trustee and to
each Rating Agency, the Certificateholders have a claim with
respect to the
funds in such account or a perfected first priority security
interest against
any collateral (which shall be limited to Permitted Investments)
securing such
funds that is superior to claims of any other depositors or
creditors of the
depository institution or trust company in which such account is
maintained,
or (iii) a trust account or accounts maintained with the corporate
trust
department of a federal or state chartered depository institution
or trust
company having capital and surplus of not less than $50,000,000,
acting in its
fiduciary capacity or (iv) any other account acceptable to the
Rating Agencies
without reduction or withdrawal of their then-current ratings of
the
Certificates as evidenced by a
21
<PAGE>
letter from each Rating Agency to the Trustee. Eligible Accounts
may bear
interest, and may include, if otherwise qualified under this
definition,
accounts maintained with the Trustee.
Eligible Repurchase Month: As defined in Section 3.12(d)
hereof.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm
commitment
underwriting or private placement that meets the applicable
requirements of
the Underwriter's Exemption.
ERISA-Restricted Certificates: The Class A-R Certificates, Class
P
Certificates, Class C Certificates, Class B Certificates and
Certificates of
any Class that does not have or no longer has a rating of BBB- or
its
equivalent, or better, from at least one Rating Agency.
Escrow Account: As defined in Section 3.06 hereof.
Event of Default: As defined in Section 7.01 hereof.
Excess Cashflow: With respect to any Distribution Date the sum
of
(i) the amount remaining after the distribution of interest to
Certificateholders for such Distribution Date pursuant to
Section
4.04(a)(v)(b), (ii) the amount remaining after the distribution of
principal
to Certificateholders for such Distribution Date, pursuant to
Section
4.04(b)(1)(B)(ii) or 4.04(b)(2)(B)(iii) and (iii) the
Overcollateralization
Reduction Amount for such Distribution Date.
Excess Deposit: As defined in Section 8.11 hereof.
Excess Overcollateralization Amount: With respect to any
Distribution Date, the excess, if any, of the Overcollateralized
Amount for
such Distribution Date over the Overcollateralization Target Amount
for such
Distribution Date.
Excess Proceeds: With respect to any Liquidated Mortgage Loan,
the
amount, if any, by which the sum of any Liquidation Proceeds and
Subsequent
Recoveries are in excess of the sum of (i) the unpaid principal
balance of
such Liquidated Mortgage Loan as of the date of liquidation of such
Liquidated
Mortgage Loan plus (ii) interest at the Mortgage Rate from the Due
Date as to
which interest was last paid or advanced to Certificateholders (and
not
reimbursed to the Master Servicer) up to the Due Date in the month
in which
Liquidation Proceeds are required to be distributed on the Stated
Principal
Balance of such Liquidated Mortgage Loan outstanding during each
Due Period as
to which such interest was not paid or advanced.
Exchange Act: The Securities Exchange Act of 1934, as amended,
and
the rules and regulations promulgated thereunder.
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and
Form
10-K required to be filed by the Depositor with respect to the
Trust Fund
under the Exchange Act.
22
<PAGE>
Expense Fee Rate: With respect to any Mortgage Loan, the sum of
(i)
the Servicing Fee Rate, (ii) the Trustee Fee Rate, (iii) with
respect to a
Covered Mortgage Loan, the applicable Mortgage Insurance Premium
Rate and (iv)
with respect to any Mortgage Loan covered by a lender paid mortgage
insurance
policy (other than a Mortgage Insurance Policy), the related
mortgage
insurance premium rate.
Extra Principal Distribution Amount: With respect to any
Distribution Date and each of Loan Group 1 and Loan Group 2, the
lesser of (1)
the Overcollateralization Deficiency Amount and (2) the Excess
Cashflow and
Credit Comeback Excess Cashflow available for payment thereof, to
be allocated
between Loan Group 1 and Loan Group 2, pro rata, based on the
Principal
Remittance Amount for each such Loan Group for such Distribution
Date.
Fannie Mae: The Federal National Mortgage Association, a
federally
chartered and privately owned corporation organized and existing
under the
Federal National Mortgage Association Charter Act, or any successor
thereto.
FDIC: The Federal Deposit Insurance Corporation, or any
successor
thereto.
Final Maturity Funding Cap: For any Distribution Date beginning
with
the Distribution Date in December 2016, the least of (i) the
aggregate
Certificate Principal Balance of the Interest-Bearing Certificates
immediately
prior to that Distribution Date, (ii) the aggregate Stated
Principal Balance
of all outstanding 40-Year Mortgage Loans as of the first day of
the related
Due Period (after giving effect to Principal Prepayments received
during the
Prepayment Period that ends during such Due Period) and (iii)
$29,657,360.
Final Maturity OC Trigger: With respect to any Distribution Date
on
or after the Distribution Date in December 2026, the Final Maturity
OC Trigger
will be in effect if and for so long as the sum of (x) the amount
on deposit
in the Final Maturity Reserve Fund on that Distribution Date and
(y) the
Overcollateralized Amount for that Distribution Date is less than
the
outstanding Stated Principal Balance of all 40-Year Mortgage Loans
as of the
first day of the related Due Period (after giving effect to
Principal
Prepayments received during the Prepayment Period that ends during
such Due
Period).
Final Maturity Required Deposit Trigger: With respect to any
Distribution Date on or after the Distribution Date in December
2016 up to and
including the Distribution Date in November 2036, the Final
Maturity Required
Deposit Trigger shall be in effect with respect to such
Distribution Date if
the aggregate Stated Principal Balance of the 40-Year Mortgage
Loans as of the
Due Date occurring in the month preceding the month of that
Distribution Date
(after giving effect to Principal Prepayments in the Prepayment
Period related
to that prior Due Date) is greater than the "40-Year Target"
specified on the
40-Year Target Schedule for such Distribution Date.
Final Maturity Reserve Deposit: For any Distribution Date
beginning
on the Distribution Date in December 2016 up to and including the
Distribution
Date in November 2036, if the Final Maturity Required Deposit
Trigger is not
in effect with respect to such Distribution Date, then the Final
Maturity
Reserve Deposit with respect to such Distribution Date shall be $0,
and if the
Final Maturity Required Deposit Trigger is in effect with respect
to such
23
<PAGE>
Distribution Date, then the Final Maturity Reserve Deposit with
respect to
such Distribution Date shall be an amount equal to the lesser of
(a)
one-twelfth of the product of (i) 0.80% and (ii) the aggregate
Stated
Principal Balance of the 40-Year Mortgage Loans as of the Due Date
occurring
in the month preceding the month of that Distribution Date (after
giving
effect to Principal Prepayments in the Prepayment Period related to
that prior
Due Date) and (b) the excess of (i) the Final Maturity Funding Cap
for such
Distribution Date over (ii) the amount on deposit in the Final
Maturity
Reserve Fund immediately prior to such Distribution Date.
Final Maturity Reserve Fund: The separate Eligible Account
created
and initially maintained by the Trustee pursuant to Section 4.09 in
the name
of the Trustee for the benefit of the Certificateholders and
designated "The
Bank of New York in trust for registered Holders of CWABS, Inc.,
Asset-Backed
Certificates, Series 2006-23". Funds in the Final Maturity Reserve
Fund shall
be held in trust for the Certificateholders for the uses and
purposes set
forth in this Agreement.
Final Maturity Reserve Trust: The trust fund established by
Section
4.10.
Final Maturity Reserve Trustee: The Bank of New York, a New
York
banking corporation, not in its individual capacity, but solely in
its
capacity as trustee for the benefit of the Holders of the
Certificates under
this Agreement, and any successor thereto, and any corporation or
national
banking association resulting from or surviving any consolidation
or merger to
which it or its successors may be a party and any successor trustee
as may
from time to time be serving as successor trustee hereunder.
Five-Year Hybrid Mortgage Loan: A Mortgage Loan having a
Mortgage
Rate that is fixed for 60 months after origination thereof before
such
Mortgage Rate becomes subject to adjustment.
Fixed Rate Mortgage Loans: The Mortgage Loans identified in the
Mortgage Loan Schedule as having a Mortgage Rate which is fixed for
the life
of the related Mortgage and any Credit Comeback Loans, including in
each case
any Mortgage Loans delivered in replacement thereof.
Form 10-D Disclosure Item: With respect to any Person, any
material
litigation or governmental proceedings pending against such Person,
or against
any of the Trust Fund, the Depositor, the Trustee, any co-trustee,
the Master
Servicer or any Subservicer, if such Person has actual knowledge
thereof.
Form 10-K Disclosure Item: With respect to any Person, (a) Form
10-D
Disclosure Item, and (b) any affiliations or relationships between
such Person
and any Item 1119 Party.
Freddie Mac: The Federal Home Loan Mortgage Corporation, a
corporate
instrumentality of the United States created and existing under
Title III of
the Emergency Home Finance Act of 1970, as amended, or any
successor thereto.
24
<PAGE>
Funding Period: The period from the Closing Date to and
including
the earlier to occur of (x) the date the amount in the Pre-Funding
Account is
less than $175,000 and (y) January 22, 2007.
Gross Margin: The percentage set forth in the related Mortgage
Note
to be added to the Index for use in determining the Mortgage Rate
for each
Adjustable Rate Mortgage Loan on each of its Adjustment Dates.
Group 1 Mortgage Loans: The group of Mortgage Loans identified
in
the related Mortgage Loan Schedule as "Group 1 Mortgage Loans",
including in
each case any Mortgage Loans delivered in replacement thereof.
Group 1 Overcollateralization Reduction Amount: With respect to
any
Distribution Date, the Overcollateralization Reduction Amount for
such
Distribution Date multiplied by a fraction, the numerator of which
is (x) the
Principal Remittance Amount for Loan Group 1 for such Distribution
Date, and
the denominator of which is (y) the aggregate Principal Remittance
Amount for
Loan Group 1 and Loan Group 2 for such Distribution Date.
Group 1 Pre-Funded Amount: The portion of the Pre-Funded Amount
allocable for purchase of Subsequent Mortgage Loans as Group 1
Mortgage Loans
on the Closing Date, which shall equal $139,603,330.66.
Group 2 Mortgage Loans: The group of Mortgage Loans identified
in
the related Mortgage Loan Schedule as "Group 2 Mortgage Loans",
including in
each case any Mortgage Loans delivered in replacement thereof.
Group 2 Overcollateralization Reduction Amount: With respect to
any
Distribution Date, the Overcollateralization Reduction Amount for
such
Distribution Date multiplied by a fraction, the numerator of which
is the
Principal Remittance Amount for Loan Group 2 for such Distribution
Date, and
the denominator of which is the aggregate Principal Remittance
Amount for Loan
Group 1 and Loan Group 2 for such Distribution Date.
Group 2 Pre-Funded Amount: The portion of the Pre-Funded Amount
allocable for purchase of Subsequent Mortgage Loans as Group 2
Mortgage Loans
on the Closing Date, which shall equal $250,831,116.97.
Index: As to any Adjustable Rate Mortgage Loan on any
Adjustment
Date related thereto, the index for the adjustment of the Mortgage
Rate set
forth as such in the related Mortgage Note, or, if the Index in the
Mortgage
Note ceases to be published or becomes unavailable for any reason,
then the
Index shall be a new index selected by the Master Servicer, based
on
comparable information and in accordance with the Mortgage Note and
applicable
law.
Initial Adjustment Date: As to any Adjustable Rate Mortgage
Loan,
the first Adjustment Date following the origination of such
Mortgage Loan.
Initial Certificate Account Deposit: An amount equal to the
aggregate of all amounts in respect of (i) principal of the Initial
Mortgage
Loans due after the Initial Cut-off Date and received by the Master
Servicer
before the Closing Date and not applied in computing the
25
<PAGE>
Cut-off Date Principal Balance thereof and (ii) interest on the
Initial
Mortgage Loans due after the Initial Cut-off Date and received by
the Master
Servicer before the Closing Date.
Initial Certificate Principal Balance: With respect to any
Certificate (other than the Class C Certificates) the Certificate
Principal
Balance of such Certificate or any predecessor Certificate on the
Closing
Date.
Initial Cut-off Date: In the case of any Initial Mortgage Loan,
the
later of (x) November 1, 2006 and (y) the date of origination of
such Mortgage
Loan.
Initial Mortgage Loan: A Mortgage Loan conveyed to the Trustee
on
the Closing Date pursuant to this Agreement as identified on the
Mortgage Loan
Schedule delivered to the Trustee on the Closing Date.
Initial Mortgage Rate: As to each Adjustable Rate Mortgage Loan,
the
Mortgage Rate in effect prior to the Initial Adjustment Date.
Initial Periodic Rate Cap: With respect to each Adjustable Rate
Mortgage Loan, the percentage specified in the related Mortgage
Note that
limits the permissible increase or decrease in the Mortgage Rate on
its
initial Adjustment Date.
Institutional Accredited Investor or IAI: An "accredited
investor"
as defined in any of paragraphs (1), (2), (3)and (7) of Rule 501(a)
under the
Securities Act or any entity in which all of the equity owners come
within
such paragraphs.
Insurance Policy: With respect to any Mortgage Loan included in
the
Trust Fund, any insurance policy, including each Mortgage Insurance
Policy and
all riders and endorsements to each such Mortgage Insurance Policy
in effect
with respect to such Mortgage Loan, including any replacement
policy or
policies for any Insurance Policy.
Insurance Proceeds: Proceeds paid in respect of the Mortgage
Loans
pursuant to any Insurance Policy or any other insurance policy
covering a
Mortgage Loan, to the extent such proceeds are payable to the
mortgagee under
the Mortgage, the Master Servicer or the trustee under the deed of
trust and
are not applied to the restoration of the related Mortgaged
Property or
released to the Mortgagor in accordance with the procedures that
the Master
Servicer would follow in servicing mortgage loans held for its own
account, in
each case other than any amount included in such Insurance Proceeds
in respect
of Insured Expenses and received either prior to or in connection
with such
Mortgage Loan becoming a Liquidated Mortgage Loan.
Insured Expenses: Expenses covered by an Insurance Policy or
any
other insurance policy with respect to the Mortgage Loans.
Interest-Bearing Certificates: The Class A Certificates and the
Subordinate Certificates.
Interest Carry Forward Amount: With respect to each Class of
Interest-Bearing Certificates and each Distribution Date, the
excess of (i)
the Current Interest for such Class with
26
<PAGE>
respect to prior Distribution Dates over (ii) the amount actually
distributed
to such Class with respect to interest on such prior Distribution
Dates.
Interest Determination Date: With respect to the first Accrual
Period for the Interest-Bearing Certificates, December 6, 2006.
With respect
to any Accrual Period for the Interest-Bearing Certificates
thereafter, the
second LIBOR Business Day preceding the commencement of such
Accrual Period.
Interest Funds: With respect to any Distribution Date and Loan
Group, the Interest Remittance Amount for such Loan Group and
Distribution
Date, less the portion of the Trustee Fee for such Distribution
Date allocable
to such Loan Group, plus the Adjusted Replacement Upfront Amount,
if any,
allocable to that Loan Group, less the Mortgage Insurance Premiums
for the
Covered Mortgage Loans in that Loan Group for such Distribution
Date..
Interest Remittance Amount: With respect to the Mortgage Loans
in
each Loan Group and any Distribution Date, (x) the sum, without
duplication,
of (i) all scheduled interest collected during the related Due
Period (for the
avoidance of doubt, other than Credit Comeback Excess Amounts) with
respect to
the related Mortgage Loans less the related Servicing Fee, (ii) all
interest
on prepayments received during the related Prepayment Period with
respect to
such Mortgage Loans, other than Prepayment Interest Excess, (iii)
all related
Advances relating to interest with respect to such Mortgage Loans,
(iv) all
related Compensating Interest with respect to such Mortgage Loans,
(v)
Liquidation Proceeds with respect to such Mortgage Loans collected
during the
related Due Period (to the extent such Liquidation Proceeds relate
to
interest) and (vi) the related Seller Shortfall Interest
Requirement, less (y)
all reimbursements to the Master Servicer during the related Due
Period for
Advances of interest previously made allocable to such Loan
Group.
Investment Letter: As defined in Section 5.02(b).
Item 1119 Party: The Depositor, any Seller, the Master Servicer,
the
Trustee, any Subservicer, any originator identified in the
Prospectus
Supplement, the Swap Counterparty and any other material
transaction party, as
identified in Exhibit Z hereto, as updated pursuant to Section
11.04.
Latest Possible Maturity Date: The Distribution Date following
the
third anniversary of the scheduled maturity date of the Mortgage
Loan having
the latest scheduled maturity date as of the Cut-off Date.
LIBOR Business Day: Any day on which banks in the City of
London,
England and New York City, U.S.A. are open and conducting
transactions in
foreign currency and exchange.
Limited Exchange Act Reporting Obligations: The obligations of
the
Master Servicer under Section 3.17(b), Section 6.02 and Section
6.04 with
respect to notice and information to be provided to the Depositor
and Article
XI (except Section 11.07(a)(1) and (2)).
Liquidated Mortgage Loan: With respect to any Distribution Date,
a
defaulted Mortgage Loan that has been liquidated through
deed-in-lieu of
foreclosure, foreclosure sale,
27
<PAGE>
trustee's sale or other realization as provided by applicable law
governing
the real property subject to the related Mortgage and any security
agreements
and as to which the Master Servicer has certified in the related
Prepayment
Period that it has received all amounts it expects to receive in
connection
with such liquidation.
Liquidation Proceeds: Amounts, including Insurance Proceeds,
received in connection with the partial or complete liquidation of
Mortgage
Loans, whether through trustee's sale, foreclosure sale or
otherwise or
amounts received in connection with any condemnation or partial
release of a
Mortgaged Property and any other proceeds received in connection
with an REO
Property received in connection with or prior to such Mortgage Loan
becoming a
Liquidated Mortgage Loan (other than the amount of such net
proceeds
representing any profit realized by the Master Servicer in
connection with the
disposition of any such properties), less the sum of related
unreimbursed
Advances, Servicing Fees and Servicing Advances.
Loan Group: Either of Loan Group 1 or Loan Group 2.
Loan Group 1: The Group 1 Mortgage Loans.
Loan Group 2: The Group 2 Mortgage Loans.
Loan Number and Borrower Identification Mortgage Loan Schedule:
With
respect to any Subsequent Transfer Date, the Loan Number and
Borrower
Identification Mortgage Loan Schedule delivered in connection with
such
Subsequent Transfer Date pursuant to Section 2.01(f). Each Loan
Number and
Borrower Identification Mortgage Loan Schedule shall contain the
information
specified in the definition of "Mortgage Loan Schedule" with
respect to the
Subsequent Mortgage Loans conveyed on such Subsequent Transfer
Date, and each
Loan Number and Borrower Identification Mortgage Loan Schedule
shall be deemed
to be included in the Mortgage Loan Schedule.
Loan-to-Value Ratio: As to any Mortgage Loan, the fraction,
expressed as a percentage, the numerator of which is the original
principal
balance of such Mortgage Loan and the denominator of which is the
Appraised
Value of the related Mortgaged Property.
Majority Holder: The Holders of Certificates evidencing at least
51%
of the Voting Rights allocated to such Class of Certificates.
Master REMIC: As defined in the Preliminary Statement.
Master Servicer: Countrywide Home Loans Servicing LP, a Texas
limited partnership, and its successors and assigns, in its
capacity as master
servicer hereunder.
Master Servicer
Advance Date: As to any Distribution Date, the
Business Day immediately preceding such Distribution Date.
Master Servicer Prepayment Charge Payment Amount: The amounts
(i)
payable by the Master Servicer in respect of any Prepayment Charges
waived
other than in accordance with the standard set forth in the first
sentence of
Section 3.20(a), or (ii) collected from the
28
<PAGE>
Master Servicer in respect of a remedy for the breach of the
representation
made by CHL set forth in Section 3.20(c).
Maximum Mortgage Rate: With respect to each Adjustable Rate
Mortgage
Loan, the maximum rate of interest set forth as such in the related
Mortgage
Note.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation
organized and existing under the laws of the State of Delaware, or
any
successor thereto.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on
the
MERS(R) System.
MERS(R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for any MERS Mortgage
Loan.
Minimum Auction Amount: With respect to any auction of the
Mortgage
Loans and any REO Properties pursuant to Section 9.04, the sum of
(i) the
Termination Price that would be payable by the NIM Insurer if the
Optional
Termination were exercised in the following calendar month pursuant
to Section
9.01 and (ii) all reasonable fees and expenses incurred by the
Trustee in
connection with any auction conducted pursuant to Section 9.04.
Minimum Mortgage Rate: With respect to each Adjustable Rate
Mortgage
Loan, the minimum rate of interest set forth as such in the related
Mortgage
Note.
Modified Mortgage Loan: As defined in Section 3.12(a).
MOM Loan: Any Mortgage Loan, as to which MERS is acting as
mortgagee, solely as nominee for the originator of such Mortgage
Loan and its
successors and assigns.
Monthly Statement: The statement delivered to the
Certificateholders
pursuant to Section 4.05.
Moody's: Moody's Investors Service, Inc. and its successors.
Mortgage: The mortgage, deed of trust or other instrument creating
a
first lien on or first priority ownership interest in an estate in
fee simple
in real property securing a Mortgage Note.
Mortgage File: The mortgage documents listed in Section 2.01
hereof
pertaining to a particular Mortgage Loan and any additional
documents
delivered to the Trustee to be added to the Mortgage File pursuant
to this
Agreement.
Mortgage Insurance Policy: Either of the Mortgage Insurance
Policy
issued by United Guaranty Mortgage Indemnity Company, the Mortgage
Insurance
Policy issued by Mortgage Guaranty Insurance Corporation or the
Mortgage
Insurance Policy issued by Republic Mortgage Insurance Company with
respect to
certain Mortgage Loans identified in the Mortgage Loan
Schedule.
Mortgage Insurance Premium: Either of the premium payable on
the
Mortgage Insurance Policy issued by United Guaranty Mortgage
Indemnity
Company, the premium payable on the Mortgage Insurance Policy
issued by
Mortgage Guaranty Insurance Corporation or the premium payable on
the Mortgage
Insurance Policy issued by Republic
29
<PAGE>
Mortgage Insurance Company, each on each Distribution Date and
amounts due for
premium taxes with respect to West Virginia and Kentucky.
Mortgage Insurance Premium Rate: With respect to a Covered
Mortgage
Loan and any Distribution Date, the per annum rate equal to a
fraction
(expressed as a percentage), the numerator of which is equal to the
portion of
the applicable Mortgage Insurance Premium payable with respect to
such
Distribution Date attributable to such Covered Mortgage Loan
multiplied by
twelve and the denominator of which is equal to the Stated
Principal Balance
of such Covered Mortgage Loan.
Mortgage Insurer: Any of United Guaranty Mortgage Indemnity
Company,
Mortgage Guaranty Insurance Corporation or Republic Mortgage
Insurance Company
or any replacement Mortgage Insurer, as applicable.
Mortgage Loan Schedule: The list of Mortgage Loans (as from time
to
time amended by the Master Servicer to reflect the deletion of
Liquidated
Mortgage Loans and Deleted Mortgage Loans and the addition of (x)
Replacement
Mortgage Loans pursuant to the provisions of this Agreement and (y)
Subsequent
Mortgage Loans pursuant to the provisions of this Agreement and any
Subsequent
Transfer Agreement) transferred to the Trustee as part of the Trust
Fund and
from time to time subject to this Agreement, attached hereto as
Exhibit F-1,
setting forth in the following information with respect to each
Mortgage Loan:
(i)
the loan number;
(ii) the Loan Group;
(iii) the Appraised Value;
(iv) the Initial Mortgage Rate;
(v) the maturity
date;
(vi) the original principal balance;
(vii) the
Cut-off Date Principal Balance;
(viii) the first payment date of the Mortgage Loan;
(ix) the Scheduled Payment in effect as of the Cut-off Date;
(x) the Loan-to-Value
Ratio at origination;
(xi) a code indicating whether the residential dwelling at the
time of origination was represented to be owner-occupied;
(xii) a code indicating whether the residential dwelling is
either (a) a detached single-family dwelling, (b) a
two-family residential property, (c) a three-family
residential property, (d) a four-family
30
<PAGE>
residential property, (e) planned unit development, (f) a
low-rise condominium unit, (g) a high-rise condominium
unit or (h) manufactured housing;
(xiii) a code indicating whether such Mortgage Loan is a Credit
Comeback Loan;
(xiv) the purpose of the Mortgage Loan;
(xv) with respect to each Adjustable Rate Mortgage Loan:
(a) the frequency of each Adjustment Date;
(b) the next Adjustment Date;
(c) the Maximum Mortgage Rate;
(d) the Minimum Mortgage Rate;
(e) the Mortgage Rate as of the Cut-off Date;
(f) the related Initial Periodic Rate Cap and Subsequent
Periodic Rate Cap; and
(g) the Gross Margin;
(xvi) a code indicating whether the Mortgage Loan is a CHL
Mortgage Loan, a Park Monaco Mortgage Loan or a Park
Sienna Mortgage Loan;
(xvii) the premium rate for any lender-paid mortgage insurance,
if applicable;
(xviii) a code indicating whether the Mortgage Loan is a Fixed
Rate Mortgage Loan or an Adjustable Rate Mortgage Loan;
(xix) a code indicating if such Mortgage Loan is a Covered
Mortgage Loan, the applicable Mortgage Insurance Policy
and the rate for the applicable Mortgage Insurance
Premium, if applicable; and
(xx) the Servicing Fee Rate for the Mortgage Loan as of the
applicable Cut-off Date and, if the Servicing Fee Rate is
subject to increase following the initial Adjustment Date
for the Mortgage Loan, the Servicing Fee Rate for the
Mortgage Loan following the initial Adjustment Date.
Such schedule shall also set forth the total of the amounts
described under
(vii) above for all of the Mortgage Loans and for each Loan Group.
The
Mortgage Loan Schedule shall be deemed to include each Loan Number
and
Borrower Identification Mortgage Loan Schedule delivered
31
<PAGE>
pursuant to Section 2.01(f) and all the related Subsequent Mortgage
Loans and
Subsequent Mortgage Loan information included therein.
Mortgage Loans: Such of the mortgage loans transferred and
assigned
to the Trustee pursuant to the provisions hereof and any Subsequent
Transfer
Agreement as from time to time are held as part of the Trust Fund
(including
any REO Property), the mortgage loans so held being identified in
the Mortgage
Loan Schedule, notwithstanding foreclosure or other acquisition of
title of
the related Mortgaged Property. Any mortgage loan that was intended
by the
parties hereto to be transferred to the Trust Fund as indicated by
such
Mortgage Loan Schedule which is in fact not so transferred for any
reason,
including a breach of the representation contained in Section 2.02
hereof,
shall continue to be a Mortgage Loan hereunder until the Purchase
Price with
respect thereto has been paid to the Trust Fund.
Mortgage Note: The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a
Mortgage Loan.
Mortgage Pool: The aggregate of the Mortgage Loans identified in
the
Mortgage Loan Schedule.
Mortgage Rate: The annual rate of interest borne by a Mortgage
Note
from time to time; provided, however, the Mortgage Rate for each
Credit
Comeback Loan shall be treated for all purposes of payments on
the
Certificates, including the calculation of the Pass-Through Rates
and the
applicable Net Rate Cap, as reduced by 0.375% on the Due Date
following the
end of each of the first four annual periods after the origination
date,
irrespective of whether the Mortgagor qualifies for the reduction
by having a
good payment history.
Mortgaged Property: The underlying property securing a Mortgage
Loan.
Mortgagor: The obligors on a Mortgage Note.
Net Mortgage Rate: As to each Mortgage Loan, and at any time,
the
per annum rate equal to the Mortgage Rate less the Servicing Fee
Rate.
Net Rate Cap: With respect to any Distribution Date and (i) the
Class 1-A Certificates, the Class 1-A Net Rate Cap, (ii) each Class
of Class
2-A Certificates, the Class 2-A Net Rate Cap and (iii) each Class
of
Subordinate Certificates, the Subordinate Net Rate Cap.
Net Rate Carryover:
With respect to any Class of Interest-Bearing
Certificates and any Distribution Date, the sum of (A) the excess
of (i) the
amount of interest that such Class would otherwise have accrued for
such
Distribution Date had the Pass-Through Rate for such Class and the
related
Accrual Period not been determined based on the applicable Net Rate
Cap, over
(ii) the amount of interest accrued on such Class at the applicable
Net Rate
Cap for such Distribution Date and (B) the Net Rate Carryover for
such Class
for all previous Distribution Dates not previously paid pursuant to
Section
4.04, together with interest thereon at the then-applicable
Pass-Through Rate
for such Class, without giving effect to the applicable Net Rate
Cap.
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<PAGE>
Net Swap Payment: With respect to any Distribution Date and
payment
by the Swap Contract Administrator to the Swap Counterparty, the
excess, if
any, of the "Fixed Amount" (as defined in the Swap Contract) with
respect to
such Distribution Date over the "Floating Amount" (as defined in
the Swap
Contract) with respect to such Distribution Date. With respect to
any
Distribution Date and payment by the Swap Counterparty to the Swap
Contract
Administrator, the excess, if any, of the "Floating Amount" (as
defined in the
Swap Contract) with respect to such Distribution Date over the
"Fixed Amount"
(as defined in the Swap Contract) with respect to such Distribution
Date.
NIM Insurer: Any insurer guarantying at the request of CHL
certain
payments under notes backed or secured by the Class C or Class P
Certificates.
Nonrecoverable Advance: Any portion of an Advance previously made
or
proposed to be made by the Master Servicer that, in the good faith
judgment of
the Master Servicer, will not or, in the case of a current
delinquency, would
not, be ultimately recoverable by the Master Servicer from the
related
Mortgagor, related Liquidation Proceeds or otherwise.
Non-United States Person: A Person that is not a citizen or
resident
of the United States, a corporation, partnership, or other entity
(treated as
a corporation or a partnership for federal income tax purposes)
created or
organized in or under the laws of the United States, any state
thereof or the
District of Columbia, an estate whose income from sources without
the United
States is includible in gross income for United States federal
income tax
purposes regardless of its connection with the conduct of a trade
or business
within the United States, or a trust if a court within the United
States is
able to exercise primary supervision over the administration of the
trust and
one or more United States persons have authority to control all
substantial
decisions of the trustor.
OC Floor: With respect to any Distribution Date, an amount equal
to
0.50% of the sum of the aggregate Cut-off Date Principal Balance of
the
Initial Mortgage Loans and the Pre-Funded Amount.
Officer's Certificate: A certificate (i) in the case of the
Depositor, signed by the Chairman of the Board, the Vice Chairman
of the
Board, the President, a Managing Director, a Vice President
(however
denominated), an Assistant Vice President, the Treasurer, the
Secretary, or
one of the Assistant Treasurers or Assistant Secretaries of the
Depositor,
(ii) in the case of the Master Servicer, signed by the President,
an Executive
Vice President, a Vice President, an Assistant Vice President, the
Treasurer,
or one of the Assistant Treasurers or Assistant Secretaries of
Countrywide GP,
Inc., its general partner, (iii) if provided for in this Agreement,
signed by
a Servicing Officer, as the case may be, and delivered to the
Depositor and
the Trustee, as the case may be, as required by this Agreement, or
(iv) in the
case of any other Person, signed by an authorized officer of such
Person.
One-Month LIBOR: With respect to any Accrual Period for the
Interest-Bearing Certificates, the rate determined by the Trustee
on the
related Interest Determination Date on the basis of the rate for
U.S. dollar
deposits for one month as quoted on the Bloomberg Terminal on such
Interest
Determination Date; provided that the parties hereto acknowledge
that
One-Month LIBOR calculated for the first Accrual Period for the
Interest-Bearing Certificates shall equal
33
<PAGE>
5.35000% per annum. If such rate is not quoted on the Bloomberg
Terminal (or
if such service is no longer offered, such other service for
displaying
One-Month LIBOR or comparable rates as may be reasonably selected
by the
Trustee), One-Month LIBOR for the applicable Accrual Period for
the
Interest-Bearing Certificates will be the Reference Bank Rate. If
no such
quotations can be obtained by the Trustee and no Reference Bank
Rate is
available, One-Month LIBOR will be One-Month LIBOR applicable to
the preceding
Accrual Period for the Interest-Bearing Certificates.
Opinion of Counsel: A written opinion of counsel, who may be
counsel
for the Depositor or the Master Servicer, reasonably acceptable to
each
addressee of such opinion; provided that with respect to Section
6.04 or
10.01, or the interpretation or application of the REMIC
Provisions, such
counsel must (i) in fact be independent of the Depositor and the
Master
Servicer, (ii) not have any direct financial interest in the
Depositor or the
Master Servicer or in any affiliate of either and (iii) not be
connected with
the Depositor or the Master Servicer as an officer, employee,
promoter,
underwriter, trustee, partner, director or person performing
similar
functions.
Optional Termination: The termination of the Trust Fund pursuant
to
clause (a) of the first sentence of Section 9.01.
Optional Termination Date: The first Distribution Date on which
the
aggregate Stated Principal Balance of the Mortgage Loans is less
than or equal
to 10% of the sum of the aggregate Cut-off Date Principal Balance
of the
Initial Mortgage Loans and the Pre-Funded Amount.
Original Value: The value of the property underlying a Mortgage
Loan
based, in the case of the purchase of the underlying Mortgaged
Property, on
the lower of an appraisal satisfactory to the Master Servicer or
the sales
price of such property or, in the case of a refinancing, on an
appraisal
satisfactory to the Master Servicer.
OTS: The Office of Thrift Supervision.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and
authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or
delivered to the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which
other Certificates have been executed and delivered by the
Trustee
pursuant to this Agreement.
Outstanding Mortgage Loan: As of any Distribution Date, a
Mortgage
Loan with a Stated Principal Balance greater than zero that was not
the
subject of a Principal Prepayment in full, and that did not become
a
Liquidated Mortgage Loan, prior to the end of the related
Prepayment Period.
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<PAGE>
Overcollateralization Deficiency Amount: With respect to any
Distribution Date, the amount, if any, by which the
Overcollateralization
Target Amount exceeds the Overcollateralized Amount on such
Distribution Date
(after giving effect to distribution of the Principal Distribution
Amount
(other than the portion thereof consisting of the Extra Principal
Distribution
Amount) on such Distribution Date).
Overcollateralization Reduction Amount: With respect to any
Distribution Date, an amount equal to the lesser of (i) the
Excess
Overcollateralization Amount for such Distribution Date and (ii)
the aggregate
Principal Remittance Amount for Loan Group 1 and Loan Group 2 for
such
Distribution Date.
Overcollateralization Target Amount: With respect to any
Distribution Date (a) prior to the Stepdown Date, an amount equal
to 1.75% of
the sum of the aggregate Cut-off Date Principal Balance of the
Initial
Mortgage Loans and the Pre-Funded Amount and (b) on or after the
Stepdown
Date, the greater of (i) an amount equal to 3.50% of the aggregate
Stated
Principal Balance of the Mortgage Loans for the current
Distribution Date and
(ii) the OC Floor; provided, however, that if a Trigger Event is in
effect on
any Distribution Date, the Overcollateralization Target Amount will
be the
Overcollateralization Target Amount as in effect for the prior
Distribution
Date.
Overcollateralized Amount: With respect to any Distribution
Date,
the amount, if any, by which (x) the sum of the aggregate Stated
Principal
Balance of the Mortgage Loans for such Distribution Date and any
amount on
deposit in the Pre-Funding Account exceeds (y) the aggregate
Certificate
Principal Balance of the Interest-Bearing Certificates as of such
Distribution
Date (after giving effect to distribution of the Principal
Remittance Amounts
to be made on such Distribution Date and, in the case of the
Distribution Date
immediately following the end of the Funding Period, any amounts to
be
released from the Pre-Funding Account).
Ownership Interest: As to any Certificate, any ownership interest
in
such Certificate including any interest in such Certificate as the
Holder
thereof and any other interest therein, whether direct or indirect,
legal or
beneficial.
Park Monaco: Park Monaco Inc., a Delaware corporation, and its
successors and assigns.
Park Monaco Mortgage Loans: The Mortgage Loans identified as such
on
the Mortgage Loan Schedule for which Park Monaco is the applicable
Seller.
Park Sienna: Park Sienna LLC, a Delaware limited liability
company,
and its successors and assigns.
Park Sienna Mortgage Loans: The Mortgage Loans identified as such
on
the Mortgage Loan Schedule for which Park Sienna is the applicable
Seller.
Pass-Through Margin: With respect to any Accrual Period and Class
of
Interest-Bearing Certificates, the per annum rate indicated in the
following
table:
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<PAGE>
-------------------------------------------- ---------------
-----------------
Pass-Through Pass-Through
Class
Margin (1)
Margin (2)
-------------------------------------------- ---------------
-----------------
Class 1-A...............................
0.140%
0.280%
-------------------------------------------- ---------------
-----------------
Class 2-A-1.............................
0.050%
0.100 %
-------------------------------------------- ---------------
-----------------
Class 2-A-2.............................
0.110%
0.220%
-------------------------------------------- ---------------
-----------------
Class 2-A-3.............................
0.170%
0.340%
-------------------------------------------- ---------------
-----------------
Class 2-A-4.............................
0.220%
0.440%
-------------------------------------------- ---------------
-----------------
Class M-1...............................
0.250%
0.375%
-------------------------------------------- ---------------
-----------------
Class M-2...............................
0.280%
0.420%
-------------------------------------------- ---------------
-----------------
Class M-3...............................
0.330%
0.495%
-------------------------------------------- ---------------
-----------------
Class M-4...............................
0.390%
0.585%
-------------------------------------------- ---------------
-----------------
Class M-5...............................
0.410%
0.615%
-------------------------------------------- ---------------
-----------------
Class M-6...............................
0.470%
0.705%
-------------------------------------------- ---------------
-----------------
Class M-7...............................
0.950%
1.425%
-------------------------------------------- ---------------
-----------------
Class M-8...............................
1.450%
2.175%
-------------------------------------------- ---------------
-----------------
Class M-9...............................
1.750%
2.625%
-------------------------------------------- ---------------
-----------------
Class B.................................
1.750%
2.625%
-------------------------------------------- ---------------
-----------------
(1) For any Accrual
Period relating to any Distribution Date occurring on or
prior to the Optional Termination Date.
(2) For any Accrual
Period relating to any Distribution Date occurring after
the
Optional Termination Date.
Pass-Through Rate: With respect to any Accrual Period and each
Class
of Interest-Bearing Certificates the lesser of (x) One-Month LIBOR
for such
Accrual Period plus the Pass-Through Margin for such Class and
Accrual Period
and (y) the applicable Net Rate Cap for such Class and the
related
Distribution Date.
Percentage Interest: With respect to any Interest-Bearing
Certificate, a fraction, expressed as a percentage, the numerator
of which is
the Certificate Principal Balance represented by such Certificate
and the
denominator of which is the aggregate Certificate Principal Balance
of the
related Class. With respect to the Class C, Class P and Class
A-R
Certificates, the portion of the Class evidenced thereby, expressed
as a
percentage, as stated on the face of such Certificate.
Performance Certification: As defined in Section 11.05.
Permitted Investments: At any time, any one or more of the
following
obligations and securities:
(i) obligations of the United States or any agency thereof,
provided such obligations are backed by the full faith and credit
of
the United States;
(ii) general obligations of or obligations guaranteed by any
state of the United States or the District of Columbia receiving
the
highest long-term debt rating of each Rating Agency, or such
lower
rating as each Rating Agency has
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confirmed in writing is sufficient for the ratings originally
assigned to the Certificates by such Rating Agency;
(iii) commercial or finance company paper which is then
receiving the highest commercial or finance company paper rating
of
each Rating Agency, or such lower rating as each Rating Agency
has
confirmed in writing is sufficient for the ratings originally
assigned to the Certificates by such Rating Agency;
(iv) certificates of deposit, demand or time deposits, or
bankers' acceptances issued by any depository institution or
trust
company incorporated under the laws of the United States or of
any
state thereof and subject to supervision and examination by
federal
and/or state banking authorities, provided that the commercial
paper
and/or long term unsecured debt obligations of such depository
institution or trust company (or in the case of the principal
depository institution in a holding company system, the
commercial
paper or long-term unsecured debt obligations of such holding
company, but only if Moody's is not a Rating Agency) are then
rated
one of the two highest long-term and the highest short-term
ratings
of each such Rating Agency for such securities, or such lower
ratings as each Rating Agency has confirmed in writing is
sufficient
for the ratings
originally assigned to the Certificates by such
Rating Agency;
(v) repurchase obligations with respect to any security
described in clauses (i) and (ii) above, in either case entered
into
with a depository institution or trust company (acting as
principal)
described in clause (iv) above;
(vi) securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the
face
amount thereof) bearing interest or sold at a discount issued by
any
corporation incorporated under the laws of the United States or
any
state thereof which, at the time of such investment, have one of
the
two highest long term ratings of each Rating Agency (except (x)
if
the Rating Agency is Moody's, such rating shall be the highest
commercial paper rating of S&P for any such securities) and
(y), or
such lower rating as each Rating Agency has confirmed in writing
is
sufficient for the ratings originally assigned to the
Certificates
by such Rating Agency;
(vii) interests in any money market fund which at the date of
acquisition of the interests in such fund and throughout the
time
such interests are held in such fund has the highest applicable
long
term rating by each Rating Agency or such lower rating as each
Rating Agency has confirmed in writing is sufficient for the
ratings
originally assigned to the Certificates by such Rating Agency;
(viii) short term investment funds sponsored by any trust
company or national banking association incorporated under the
laws
of the United States or any state thereof which on the date of
acquisition has been rated by each Rating Agency in their
respective
highest applicable rating category or such lower rating as each
Rating Agency has confirmed in writing is sufficient for the
ratings
originally assigned to the Certificates by such Rating Agency;
and
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(ix) such other relatively risk free investments having a
specified stated maturity and bearing interest or sold at a
discount
acceptable to each Rating Agency as will not result in the
downgrading or withdrawal of the rating then assigned to the
Certificates by any Rating Agency, as evidenced by a signed
writing
delivered by each Rating Agency, and reasonably acceptable to
the
NIM Insurer, as evidenced by a signed writing delivered by the
NIM
Insurer;
provided, that no such instrument shall be a Permitted Investment
if such
instrument (i) evidences the right to receive interest only
payments with
respect to the obligations underlying such instrument, (ii) is
purchased at a
premium or (iii) is purchased at a deep discount; provided further
that no
such instrument shall be a Permitted Investment (A) if such
instrument
evidences principal and interest payments derived from obligations
underlying
such instrument and the interest payments with respect to such
instrument
provide a yield to maturity of greater than 120% of the yield to
maturity at
par of such underlying obligations, or (B) if it may be redeemed at
a price
below the purchase price (the foregoing clause (B) not to apply to
investments
in units of money market funds pursuant to clause (vii) above);
provided
further that no amount beneficially owned by any REMIC (including,
without
limitation, any amounts collected by the Master Servicer but not
yet deposited
in the Certificate Account) may be invested in investments (other
than money
market funds) treated as equity interests for Federal income tax
purposes,
unless the Master Servicer shall receive an Opinion of Counsel, at
the expense
of Master Servicer, to the effect that such investment will not
adversely
affect the status of any such REMIC as a REMIC under the Code or
result in
imposition of a tax on any such REMIC. Permitted Investments that
are subject
to prepayment or call may not be purchased at a price in excess of
par.
Permitted Transferee: Any Person other than (i) the United
States,
any State or political subdivision thereof, or any agency or
instrumentality
of any of the foregoing, (ii) a foreign government, International
Organization
or any agency or instrumentality of either of the foregoing, (iii)
an
organization (except certain farmers' cooperatives described in
section 521 of
the Code) that is exempt from tax imposed by Chapter 1 of the Code
(including
the tax imposed by section 511 of the Code on unrelated business
taxable
income) on any excess inclusions (as defined in section 860E(c)(1)
of the
Code) with respect to any Class A-R Certificate, (iv) rural
electric and
telephone cooperatives described in section 1381(a)(2)(C) of the
Code, (v) an
"electing large partnership" as defined in section 775 of the Code,
(vi) a
Person that is not a citizen or resident of the United States, a
corporation,
partnership, or other entity (treated as a corporation or a
partnership for
federal income tax purposes) created or organized in or under the
laws of the
United States, any state thereof or the District of Columbia, or an
estate
whose income from sources without the United States is includible
in gross
income for United States federal income tax purposes regardless of
its
connection with the conduct of a trade or business within the
United States,
or a trust if a court within the United States is able to exercise
primary
supervision over the administration of the trust and one or more
United States
Persons have authority to control all substantial decisions of the
trustor
unless such Person has furnished the transferor and the Trustee
with a duly
completed Internal Revenue Service Form W-8ECI, and (vii) any other
Person so
designated by the Trustee based upon an Opinion of Counsel that the
Transfer
of an Ownership Interest in a Class A-R Certificate to such Person
may cause
any REMIC formed hereunder to fail to qualify as a REMIC at any
time that any
Certificates are Outstanding. The terms "United States," "State"
and
"International Organization" shall have the
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meanings set forth in section 7701 of the Code or successor
provisions. A
corporation will not be treated as an instrumentality of the United
States or
of any State or political subdivision thereof for these purposes if
all of its
activities are subject to tax and, with the exception of the
Federal Home Loan
Mortgage Corporation, a majority of its board of directors is not
selected by
such government unit.
Person: Any individual, corporation, partnership, limited
liability
company, joint venture, association, joint-stock company,
trust,
unincorporated organization or government, or any agency or
political
subdivision thereof.
Plan: An "employee benefit plan" as defined in section 3(3)of
ERISA
that is subject to Title I of ERISA, a "plan" as defined in section
4975 of
the Code that is subject to section 4975 of the Code, or any Person
investing
on behalf of or with plan assets (as defined in 29 CFR
ss.2510.3-101 or
otherwise under ERISA) of such an employee benefit plan or
plan.
Pool Tax Cap: As defined in the Preliminary Statement.
Pool Stated Principal Balance: The aggregate of the Stated
Principal
Balances of the Mortgage Loans which were Outstanding Mortgage
Loans.
Pre-Funded Amount: The amount deposited in the Pre-Funding
Account
on the Closing Date, which shall equal $390,434,447.63.
Pre-Funding Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.05 in the name of
the Trustee
for the benefit of the Certificateholders and designated "The Bank
of New
York, in trust for registered holders of CWABS, Inc.,
Asset-Backed
Certificates, Series 2006-23." Funds in the Pre-Funding Account
shall be held
in trust for the Certificateholders for the uses and purposes set
forth in
this Agreement and shall not be a part of any REMIC created
hereunder,
provided, however that any investment income earned from Permitted
Investments
made with funds in the Pre-Funding Account will be for the account
of CHL.
Prepayment Assumption: The applicable rate of prepayment, as
described in the Prospectus Supplement relating to the
Certificates.
Prepayment Charge: With respect to any Mortgage Loan, the charges
or
premiums, if any, due in connection with a full or partial
prepayment of such
Mortgage Loan within the related Prepayment Charge Period in
accordance with
the terms thereof (other than any Master Servicer Prepayment Charge
Payment
Amount).
Prepayment Charge Period: With respect to any Mortgage Loan,
the
period of time during which a Prepayment Charge may be imposed.
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Prepayment Charge Schedule: As of the Initial Cut-off Date with
respect to each Initial Mortgage Loan and as of the Subsequent
Cut-off Date
with respect to each Subsequent Mortgage Loan, a list attached
hereto as
Schedule I (including the Prepayment Charge Summary attached
thereto), setting
forth the following information with respect to each Prepayment
Charge:
(i) the Mortgage Loan identifying number;
(ii) a code indicating the type of Prepayment Charge;
(iii) the state of origination of the related Mortgage Loan;
(iv) the date on which the first monthly payment was due on the
related Mortgage Loan;
(v) the term of the related Prepayment Charge; and
(vi) the principal balance of the related Mortgage Loan as of
the Cut-off Date.
As of the Closing Date, the Prepayment Charge Schedule shall
contain
the necessary information for each Initial Mortgage Loan. The
Prepayment
Charge Schedule shall be amended by the Master Servicer upon the
sale of any
Subsequent Mortgage Loans to the Trust Fund. In addition, the
Prepayment
Charge Schedule shall be amended from time to time by the Master
Servicer in
accordance with the provisions of this Agreement and a copy of each
related
amendment shall be furnished by the Master Servicer to the Class P
and Class C
Certificateholders and the NIM Insurer.
Prepayment Interest Excess: With respect to any Distribution
Date,
for each Mortgage Loan that was the subject of a Principal
Prepayment during
the period from the related Due Date to the end of the related
Prepayment
Period, any payment of interest received in connection therewith
(net of any
applicable Servicing Fee) representing interest accrued for any
portion of
such month of receipt.
Prepayment Interest Shortfall: With respect to any Distribution
Date, for each Mortgage Loan that was the subject of a partial
Principal
Prepayment or a Principal Prepayment in full during the period from
the
beginning of the related Prepayment Period to the Due Date in such
Prepayment
Period (other than a Principal Prepayment in full resulting from
the purchase
of a Mortgage Loan pursuant to Section 2.02, 2.03, 2.04, 3.12 or
9.01 hereof)
and for each Mortgage Loan that became a Liquidated Mortgage Loan
during the
related Due Period, the amount, if any, by which (i) one month's
interest at
the applicable Net Mortgage Rate on the Stated Principal Balance of
such
Mortgage Loan immediately prior to such prepayment (or liquidation)
or in the
case of a partial Principal Prepayment on the amount of such
prepayment (or
Liquidation Proceeds) exceeds (ii) the amount of interest paid or
collected in
connection with such Principal Prepayment or such Liquidation
Proceeds.
Prepayment Period: As to any Distribution Date and related Due
Date,
the period beginning with the opening of business on the sixteenth
day of the
calendar month preceding the
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month in which such Distribution Date occurs (or, with respect to
the first
Distribution Date, the period beginning with the opening of
business on
November 2, 2006) and ending on the close of business on the
fifteenth day of
the month in which such Distribution Date occurs.
Prime Rate: The prime commercial lending rate of The Bank of
New
York, as publicly announced to be in effect from time to time. The
Prime Rate
shall be adjusted automatically, without notice, on the effective
date of any
change in such prime commercial lending rate. The Prime Rate is
not
necessarily The Bank of New York's lowest rate of interest.
Principal Distribution Amount: With respect to each
Distribution
Date and a Loan Group, the sum of (i) the Principal Remittance
Amount for such
Loan Group for such Distribution Date less any portion of such
amount used to
cover any payment due to the Swap Counterparty with respect to
such
Distribution Date pursuant to Section 4.09, (ii) the Extra
Principal
Distribution Amount for such Loan Group for such Distribution Date,
and (iii)
with respect to the Distribution Date immediately following the end
of the
Funding Period, the amount, if any, remaining in the Pre-Funding
Account at
the end of the Funding Period (net of any investment income
therefrom)
allocable to such Loan Group, minus (iv) (a) the amount of any
Group 1
Overcollateralization Reduction Amount, in the case of Loan Group 1
and (b)
the amount of any Group 2 Overcollateralization Reduction Amount,
in the case
of Loan Group 2.
Principal Prepayment: Any Mortgagor payment or other recovery of
(or
proceeds with respect to) principal on a Mortgage Loan (including
loans
purchased or repurchased under Sections 2.02, 2.03, 2.04, 3.12 and
9.01
hereof) that is received in advance of its scheduled Due Date to
the extent it
is not accompanied by an amount as to interest representing
scheduled interest
due on any date or dates in any month or months subsequent to the
month of
prepayment. Partial Principal Prepayments shall be applied by the
Master
Servicer in accordance with the terms of the related Mortgage
Note.
Principal Remittance Amount: With respect to the Mortgage Loans
in
each Loan Group and any Distribution Date, (a) the sum, without
duplication,
of: (i) the scheduled principal collected with respect to the
Mortgage Loans
during the related Due Period or advanced with respect to such
Distribution
Date, (ii) Principal Prepayments collected in the related
Prepayment Period,
with respect to the Mortgage Loans, (iii) the Stated Principal
Balance of each
Mortgage Loan that was repurchased by a Seller or purchased by the
Master
Servicer with respect to such Distribution Date, (iv) the amount,
if any, by
which the aggregate unpaid principal balance of any Replacement
Mortgage Loans
delivered by the Sellers in connection with a substitution of a
Mortgage Loan
is less than the aggregate unpaid principal balance of any Deleted
Mortgage
Loans and (v) all Liquidation Proceeds (to the extent such
Liquidation
Proceeds related to principal) and Subsequent Recoveries collected
during the
related Due Period; less (b) all Advances relating to principal and
certain
expenses reimbursable pursuant to Section 6.03 and reimbursed
during the
related Due Period, in each case with respect to such Loan
Group.
Principal Reserve Fund: The separate Eligible Account created
and
initially maintained by the Trustee pursuant to Section 3.08 in the
name of
the Trustee for the benefit of the Certificateholders and
designated "The Bank
of New York in trust for registered Holders of CWABS, Inc.,
Asset-Backed
Certificates, Series 2006-23". Funds in the Principal Reserve
Fund
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shall be held in trust for the Certificateholders for the uses and
purposes
set forth in this Agreement.
Private Certificates: The Class B, Class C and Class P
Certificates.
Prospectus: The prospectus dated November 27, 2006, relating to
asset-backed securities to be sold by the Depositor.
Prospectus Supplement: The prospectus supplement dated December
7,
2006, relating to the public offering of the certain Classes of
Certificates
offered thereby.
PTCE 95-60: As defined in Section 5.02(b).
PUD: A Planned Unit Development.
Purchase Price: With respect to any Mortgage Loan (x) required to
be
(1) repurchased by a Seller or purchased by the Master Servicer,
as
applicable, pursuant to Section 2.02, 2.03 or 3.12 hereof or (2)
repurchased
by the Depositor pursuant to Section 2.04 hereof, or (y) that the
Master
Servicer has a right to purchase pursuant to Section 3.12 hereof,
an amount
equal to the sum of (i) 100% of the unpaid principal balance (or,
if such
purchase or repurchase, as the case may be, is effected by the
Master
Servicer, the Stated Principal Balance) of the Mortgage Loan as of
the date of
such purchase, (ii) accrued interest thereon at the applicable
Mortgage Rate
(or, if such purchase or repurchase, as the case may be, is
effected by the
Master Servicer, at the Net Mortgage Rate) from (a) the date
through which
interest was last paid by the Mortgagor (or, if such purchase or
repurchase,
as the case may be, is effected by the Master Servicer, the date
through which
interest was last advanced and not reimbursed by the Master
Servicer) to (b)
the Due Date in the month in which the Purchase Price is to be
distributed to
Certificateholders and (iii) any costs, expenses and damages
incurred by the
Trust Fund resulting from any violation of any predatory or abusive
lending
law in connection with such Mortgage Loan.
Qualified Bidder: With respect to any auction pursuant to
Section
9.04, any institution that is a regular purchaser and/or seller in
the
secondary market of residential mortgage loans as determined by the
Trustee
(or any advisor on its behalf), in its sole discretion, and any
holder of an
interest in the Class C Certificates; provided, however, that
neither CHL nor
any of its affiliates shall constitute a Qualified Bidder.
Qualified Institutional Buyer or QIB: A "qualified
institutional
buyer" within the meaning of Rule 144A.
Rating Agency: Each of Moody's and S&P. If any such
organization or
its successor is no longer in existence, "Rating Agency" shall be a
nationally
recognized statistical rating organization, or other comparable
Person,
identified as a "Rating Agency" in the Underwriter's Exemption and
designated
by the Depositor, notice of which designation shall be given to the
Trustee.
References herein to a given rating category of a Rating Agency
shall mean
such rating category without giving effect to any modifiers.
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<PAGE>
Realized Loss: With respect to each Liquidated Mortgage Loan,
an
amount (not less than zero or more than the Stated Principal
Balance of the
Mortgage Loan) as of the date of such liquidation, equal to (i) the
Stated
Principal Balance of such Liquidated Mortgage Loan as of the date
of such
liquidation, minus (ii) the Liquidation Proceeds, if any, received
in
connection with such liquidation during the month in which such
liquidation
occurs, to the extent applied as recoveries of principal of the
Liquidated
Mortgage Loan. With respect to each Mortgage Loan that has become
the subject
of a Deficient Valuation, (i) if the value of the related Mortgaged
Property
was reduced below the principal balance of the related Mortgage
Note, the
amount by which the value of the Mortgaged Property was reduced
below the
principal balance of the related Mortgage Note, and (ii) if the
principal
amount due under the related Mortgage Note has been reduced, the
difference
between the principal balance of the Mortgage Loan outstanding
immediately
prior to such Deficient Valuation and the principal balance of the
Mortgage
Loan as reduced by the Deficient Valuation.
Record Date: With respect to any Distribution Date and the
Interest-Bearing Certificates, the Business Day immediately
preceding such
Distribution Date, or if any such Certificates are no longer
Book-Entry
Certificates, the Record Date with respect to such Certificates
shall be the
last Business Day of the month preceding the month of such
Distribution Date.
With respect to any Distribution Date and the Class A-R, Class C
and Class P
Certificates and the first Distribution Date, the Closing Date, and
with
respect to any other Distribution Date, the last Business Day of
the month
preceding the month of such Distribution Date.
Reference Bank Rate: With respect to any Accrual Period, the
arithmetic mean (rounded upwards, if necessary, to the nearest
whole multiple
of 0.03125%) of the offered rates for United States dollar deposits
for one
month that are quoted by the Reference Banks as of 11:00 a.m., New
York City
time, on the related Interest Determination Date to prime banks in
the London
interbank market for a period of one month in amounts approximately
equal to
the outstanding aggregate Certificate Principal Balance of the
Interest-Bearing Certificates on such Interest Determination Date,
provided
that at least two such Reference Banks provide such rate. If fewer
than two
offered rates appear, the Reference Bank Rate will be the
arithmetic mean
(rounded upwards, if necessary, to the nearest whole multiple of
0.03125%) of
the rates quoted by one or more major banks in New York City,
selected by the
Trustee, as of 11:00 a.m., New York City time, on such date for
loans in U.S.
dollars to leading European banks for a period of one month in
amounts
approximately equal to the aggregate Certificate Principal Balance
of the
Interest-Bearing Certificates on such Interest Determination
Date.
Reference Banks: Barclays Bank PLC, Deutsche Bank and NatWest,
N.A.,
provided that if any of the foregoing banks are not suitable to
serve as a
Reference Bank, then any leading banks selected by the Trustee
which are
engaged in transactions in Eurodollar deposits in the
international
Eurocurrency market (i) with an established place of business in
London,
England, (ii) not controlling, under the control of or under common
control
with the Depositor, CHL or the Master Servicer and (iii) which have
been
designated as such by the Trustee.
Refinancing Mortgage Loan: Any Mortgage Loan originated in
connection with the refinancing of an existing mortgage loan.
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Regular Certificate: Any Certificate other than the Class A-R
Certificates.
Regulation AB: Subpart 229.1100 - Asset Backed Securities
(Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be
amended
from time to time, and subject to such clarification and
interpretation as
have been provided by the Commission in the adopting release
(Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506,
1,531
(Jan. 7, 2005)) or by the staff of the Commission, or as may be
provided by
the Commission or its staff from time to time and publicly
available.
Relief Act: The Servicemembers Civil Relief Act.
REMIC Provisions: Provisions of the federal income tax law
relating
to real estate mortgage investment conduits which appear at section
860A
through 860G of Subchapter M of Chapter 1 of the Code, and related
provisions,
and regulations and rulings promulgated thereunder, as the
foregoing may be in
effect from time to time.
Remittance Report: A report prepared by the Master Servicer and
delivered to the Trustee and the NIM Insurer in accordance with
Section 4.04.
REO Property: A Mortgaged Property acquired by the Master
Servicer
through foreclosure or deed-in-lieu of foreclosure in connection
with a
defaulted Mortgage Loan.
Replacement Mortgage Loan: A Mortgage Loan substituted by a
Seller
for a Deleted Mortgage Loan which must, on the date of such
substitution, as
confirmed in a Request for File Release, (i) have a Stated
Principal Balance,
after deduction of the principal portion of the Scheduled Payment
due in the
month of substitution, not in excess of, and not less than 90% of
the Stated
Principal Balance of the Deleted Mortgage Loan; (ii) with respect
to any Fixed
Rate Mortgage Loan, have a Mortgage Rate not less than or no more
than 1% per
annum higher than the Mortgage Rate of the Deleted Mortgage Loan
and, with
respect to any Adjustable Rate Mortgage Loan: (a) have a Maximum
Mortgage Rate
no more than 1% per annum higher or lower than the Maximum Mortgage
Rate of
the Deleted Mortgage Loan; (b) have a Minimum Mortgage Rate no more
than 1%
per annum higher or lower than the Minimum Mortgage Rate of the
Deleted
Mortgage Loan; (c) have the same Index and intervals between
Adjustment Dates
as that of the Deleted Mortgage Loan; (d) have a Gross Margin not
more than 1%
per annum higher or lower than that of the Deleted Mortgage Loan;
and (e) have
an Initial Periodic Rate Cap and a Subsequent Periodic Rate Cap
each not more
than 1% lower than that of the Deleted Mortgage Loan; (iii) have
the same or
higher credit quality characteristics than that of the Deleted
Mortgage Loan;
(iv) be accruing interest at a rate not more than 1% per annum
higher or lower
than that of the Deleted Mortgage Loan; (v) have a Loan-to-Value
Ratio no
higher than that of the Deleted Mortgage Loan; (vi) have a
remaining term to
maturity not greater than (and not more than one year less than)
that of the
Deleted Mortgage Loan; (vii) not permit conversion of the Mortgage
Rate from a
fixed rate to a variable rate or vice versa; (viii) provide for a
Prepayment
Charge on terms substantially similar to those of the Prepayment
Charge, if
any, of the Deleted Mortgage Loan; (ix) have the same occupancy
type and lien
priority as the Deleted Mortgage Loan; (x) be covered by the
applicable
Mortgage Insurance Policy if the Deleted Mortgage Loan was covered
by such
Mortgage Insurance Policy and (xi) comply with each representation
and
warranty set forth in Section 2.03 as of the date of substitution;
provided,
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however, that notwithstanding the foregoing, to the extent that
compliance
with clause (xi) of this definition would cause a proposed
Replacement
Mortgage Loan to fail to comply with one or more of clauses (i),
(ii), (iv),
(viii) and/or (ix) of this definition, then such proposed
Replacement Mortgage
Loan must comply with clause (xi) and need not comply with one or
more of
clauses (i), (ii), (iv), (viii) and/or (ix), to the extent, and
only to the
extent, necessary to assure that the Replacement Mortgage Loan
otherwise
complies with clause (xi).
Reportable Event: Any event required to be reported on Form 8-K,
and
in any event, the following:
(a) entry into a definitive agreement related to the Trust Fund,
the
Certificates or the Mortgage Loans, or an amendment to a
Transaction Document,
even if the Depositor is not a party to such agreement (e.g., a
servicing
agreement with a servicer contemplated by Item 1108(a)(3)of
Regulation AB);
(b) termination of a Transaction Document (other than by
expiration
of the agreement on its stated termination date or as a result of
all parties
completing their obligations under such agreement), even if the
Depositor is
not a party to such agreement (e.g., a servicing agreement with a
servicer
contemplated by Item 1108(a)(3)of Regulation AB);
(c) with respect to the Master Servicer only, if the Master
Servicer
becomes aware of any bankruptcy or receivership with respect to
CHL, the
Depositor, the Master Servicer, any Subservicer, the Trustee, the
Swap
Counterparty, any enhancement or support provider contemplated by
Items
1114(b) or 1115 of Regulation AB, or any other material party
contemplated by
Item 1101(d)(1) of Regulation AB;
(d) with respect to the Trustee, the Master Servicer and the
Depositor only, the occurrence of an early amortization,
performance trigger
or other event, including an Event of Default under this
Agreement;
(e) any amendment to this Agreement;
(f) the resignation, removal, replacement, substitution of the
Master Servicer, any Subservicer, the Trustee or any
co-trustee;
(g) with respect to the Master Servicer only, if the Master
Servicer
becomes aware that (i) any material enhancement or support
specified in Item
1114(a)(1) through (3)of Regulation AB or Item 1115 of Regulation
AB that was
previously applicable regarding one or more classes of the
Certificates has
terminated other than by expiration of the contract on its stated
termination
date or as a result of all parties completing their obligations
under such
agreement; (ii) any material enhancement specified in Item
1114(a)(1) through
(3)of Regulation AB or Item 1115 of Regulation AB has been added
with respect
to one or more classes of the Certificates; or (iii) any existing
material
enhancement or support specified in Item 1114(a)(1) through (3)of
Regulation
AB or Item 1115 of Regulation AB with respect to one or more
classes of the
Certificates has been materially amended or modified; and
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<PAGE>
(h) with respect to the Trustee, the Master Servicer and the
Depositor only, a required distribution to Holders of the
Certificates is not
made as of the required Distribution Date under this Agreement.
Reporting Subcontractor: With respect to the Master Servicer or
the
Trustee, any Subcontractor determined by such Person pursuant to
Section
11.08(b) to be "participating in the servicing function" within the
meaning of
Item 1122 of Regulation AB. References to a Reporting Subcontractor
shall
refer only to the Subcontractor of such Person and shall not refer
to
Subcontractors generally.
Representing Party: As defined in Section 2.03(e).
Request for Document Release: A Request for Document Release
submitted by the Master Servicer to the Co-Trustee, substantially
in the form
of Exhibit M.
Request for File Release: A Request for File Release submitted
by
the Master Servicer to the Co-Trustee, substantially in the form of
Exhibit N.
Required Carryover Reserve Fund Deposit: With respect to any
Distribution Date, an amount equal to the excess of (i) $1,000 over
(ii) the
amount of funds on deposit in the Carryover Reserve Fund after all
other
deposits and withdrawals from such account on such Distribution
Date.
Required Insurance Policy: With respect to any Mortgage Loan,
any
insurance policy that is required to be maintained from time to
time under
this Agreement, including the applicable Mortgage Insurance Policy
with
respect to a Covered Mortgage Loan.
Responsible Officer: When used with respect to the Trustee, any
Vice
President, any Assistant Vice President, the Secretary, any
Assistant
Secretary, any Trust Officer or any other officer of the Trustee
customarily
performing functions similar to those performed by any of the above
designated
officers and also to whom, with respect to a particular matter,
such matter is
referred because of such officer's knowledge of and familiarity
with the
particular subject.
Rolling Sixty-Day Delinquency Rate: With respect to any
Distribution
Date on or after the Stepdown Date and any Loan Group or Loan
Groups, the
average of the Sixty-Day Delinquency Rates for such Loan Group or
Loan Groups
and such Distribution Date and the two immediately preceding
Distribution
Dates.
Rule 144A: Rule 144A under the Securities Act.
Rule 144A Letter: As defined in Section 5.02(b).
S&P: Standard & Poor's Ratings Services, a division of
The
McGraw-Hill Companies, Inc. and its successors.
Sarbanes-Oxley Certification: As defined in Section 11.05.
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Scheduled Payment: With respect to any Mortgage Loan, the
scheduled
monthly payment of principal and/or interest due on any Due Date on
such
Mortgage Loan which is payable by the related Mortgagor from time
to time
under the related Mortgage Note, determined: (a) after giving
effect to (i)
any Deficient Valuation and/or Debt Service Reduction with respect
to such
Mortgage Loan and (ii) any reduction in the amount of interest
collectible
from the related Mortgagor pursuant to the Relief Act or any
similar state or
local law; (b) without giving effect to any extension granted or
agreed to by
the Master Servicer pursuant to Section 3.05(a); and (c) on the
assumption
that all other amounts, if any, due under such Mortgage Loan are
paid when
due.
Securities Act: The Securities Act of 1933, as amended.
Sellers: CHL, in its capacity as seller of the CHL Mortgage Loans
to
the Depositor, Park Monaco, in its capacity as seller of the Park
Monaco
Mortgage Loans to the Depositor and Park Sienna, in its capacity as
seller of
the Park Sienna Mortgage Loans to the Depositor.
Seller Shortfall Interest Requirement: With respect to the
Distribution Date in each of December 2006, January 2007 and
February 2007, is
the sum of:
(a) the product of: (1) the excess of the aggregate Stated
Principal
Balance for such Distribution Date of all the Mortgage Loans in the
Mortgage
Pool (including the Subsequent Mortgage Loans, if any) owned by the
Trust Fund
at the beginning of the related Due Period, over the aggregate
Stated
Principal Balance for such Distribution Date of such Mortgage Loans
(including
such Subsequent Mortgage Loans, if any) that have a scheduled
payment of
interest due in the related Due Period, and (2) a fraction, the
numerator of
which is the weighted average Net Mortgage Rate of all the Mortgage
Loans in
the Mortgage Pool (including such Subsequent Mortgage Loans, if
any) (weighted
on the basis of the Stated Principal Balances thereof for such
Distribution
Date) and the denominator of which is 12; and
(b)
the product of: (1) the amount on deposit in the Pre-Funding
Account at the beginning of the related Due Period, and (2) a
fraction, the
numerator of which is the weighted average Net Mortgage Rate of the
Mortgage
Loans (including Subsequent Mortgage Loans, if any) owned by the
Trust Fund at
the beginning of the related Due Period (weighted on the basis of
the Stated
Principal Balances thereof for such Distribution Date) and the
denominator of
which is 12.
Senior Certificates: The Class A and Class A-R Certificates.
Senior Enhancement Percentage: With respect to a Distribution
Date
on or after the Stepdown Date, the fraction (expressed as a
percentage) (1)
the numerator of which is the excess of (a) the aggregate Stated
Principal
Balance of the Mortgage Loans for the preceding Distribution Date
over (b) (i)
before the Certificate Principal Balances of the Senior
Certificates have been
reduced to zero, the sum of the Certificate Principal Balances of
the Senior
Certificates, or (ii) after the Certificate Principal Balances of
the Senior
Certificates have been reduced to zero, the Certificate Principal
Balance of
the most senior Class of Subordinate Certificates outstanding, as
of the
related Master Servicer Advance Date, and (2) the
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denominator of which is the aggregate Stated Principal Balance of
the Mortgage
Loans for the preceding Distribution Date.
Servicing Advances: All customary, reasonable and necessary "out
of
pocket" costs and expenses incurred in the performance by the
Master Servicer
of its servicing obligations hereunder, including, but not limited
to, the
cost of (i) the preservation, restoration and protection of a
Mortgaged
Property, (ii) any enforcement or judicial proceedings,
including
foreclosures, (iii) the management and liquidation of any REO
Property and
(iv) compliance with the obligations under Section 3.10.
Servicing Criteria: The "servicing criteria" set forth in Item
1122(d) of Regulation AB.
Servicing Fee: As to each Mortgage Loan and any Distribution
Date,
an amount equal to one month's interest at the Servicing Fee Rate
on the
Stated Principal Balance of such Mortgage Loan for the preceding
Distribution
Date or, in the event of any payment of interest that accompanies a
Principal
Prepayment in full made by the Mortgagor, interest at the Servicing
Fee Rate
on the Stated Principal Balance of such Mortgage Loan for the
period covered
by such payment of interest.
Servicing Fee
Rate: With respect to each Mortgage Loan, the per
annum rate set forth on the Mortgage Loan Schedule for such
Mortgage Loan.
Servicing Officer: Any officer of the Master Servicer involved
in,
or responsible for, the administration and servicing of the
Mortgage Loans
whose name and facsimile signature appear on a list of servicing
officers
furnished to the Trustee by the Master Servicer on the Closing Date
pursuant
to this Agreement, as such list may from time to time be
amended.
Sixty-Day Delinquency Rate: With respect to any Distribution Date
on
or after the Stepdown Date, a fraction, expressed as a percentage,
the
numerator of which is the aggregate Stated Principal Balance for
such
Distribution Date of all Mortgage Loans 60 or more days delinquent
as of the
close of business on the last day of the calendar month preceding
such
Distribution Date (including Mortgage Loans in foreclosure,
bankruptcy and REO
Properties) and the denominator of which is the aggregate Stated
Principal
Balance for such Distribution Date of all Mortgage Loans.
Stated Principal Balance: With respect to any Mortgage Loan or
related REO Property (i) as of the Cut-off Date, the unpaid
principal balance
of the Mortgage Loan as of such date (before any adjustment to
the
amortization schedule for any moratorium or similar waiver or grace
period),
after giving effect to any partial prepayments or Liquidation
Proceeds
received prior to such date and to the payment of principal due on
or prior to
such date and irrespective any delinquency in payment by the
related
Mortgagor, and (ii) as of any other Distribution Date, the Stated
Principal
Balance of the Mortgage Loan as of its Cut-off Date, minus the sum
of (a) the
principal portion of the Scheduled Payments (x) due with respect to
such
Mortgage Loan during each Due Period ending prior to such
Distribution Date
and (y) that were received by the Master Servicer as of the close
of business
on the Determination Date related to such Distribution Date or with
respect to
which Advances were made as of the Master Servicer
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Advance Date related to such Distribution Date, (b) all Principal
Prepayments
with respect to such Mortgage Loan received by the Master Servicer
during each
Prepayment Period ending prior to such Distribution Date, (c) all
Liquidation
Proceeds collected with respect to such Mortgage Loan during each
Due Period
ending prior to such Distribution Date, to the extent applied by
the Master
Servicer as recoveries of principal in accordance with Section 3.12
and (d)
any Realized Loss previously incurred in connection with a
Deficient
Valuation. The Stated Principal Balance of any Mortgage Loan that
becomes a
Liquidated Mortgage Loan will be zero on each date following the
Due Period in
which such Mortgage Loan becomes a Liquidated Mortgage Loan.
References herein
to the Stated Principal Balance of the Mortgage Loans at any time
shall mean
the aggregate Stated Principal Balance of all Mortgage Loans in the
Trust Fund
as of such time, and references herein to the Stated Principal
Balance of a
Loan Group at any time shall mean the aggregate Stated Principal
Balance of
all Mortgage Loans in such Loan Group at such time.
Stepdown Date: The earlier to occur of (a) the Distribution
Date
following the Distribution Date on which the aggregate Certificate
Principal
Balance of the Senior Certificates is reduced to zero, and (b) the
later to
occur of (x) the Distribution Date in December 2009 and (y) the
first
Distribution Date on which the aggregate Certificate Principal
Balance of the
Senior Certificates (after calculating anticipated distributions on
such
Distribution Date) is less than or equal to 62.20% of the aggregate
Stated
Principal Balance of the Mortgage Loans for such Distribution
Date.
Stepdown Target Subordination Percentage: For each Class of
Subordinate Certificates (other than the Class M-1, Class M-2 and
Class M-3
Certificates), the respective percentage indicated in the following
table:
Stepdown Target
Subordination
Percentage
-------------------------------
Class M-4.................................
17.00%
Class M-5.................................
14.00%
Class M-6.................................
11.80%
Class M-7.................................
9.50%
Class M-8.................................
7.90%
Class M-9.................................
5.80%
Class B...................................
3.50%
Strip REMIC: As defined in the Preliminary Statement.
Strip REMIC Cap: As defined in the Preliminary Statement.
Subcontractor: Any vendor, subcontractor or other Person that is
not
responsible for the overall servicing (as "servicing" is commonly
understood
by participants in the mortgage-backed securities market) of
Mortgage Loans
but performs one or more discrete functions identified in Item
1122(d) of
Regulation AB with respect to the Mortgage Loans under the
direction or
authority of the Master Servicer or a Subservicer or the Trustee,
as the case
may be.
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Subordinate Certificates: The Class M-1, Class M-2, Class M-3,
Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and
Class B
Certificates.
Subordinate Class Principal Distribution Amount: With respect to
any
Distribution Date and any Class of Subordinate Certificates (other
than the
Class M-1, Class M-2 and Class M-3 Certificates), the excess of (1)
the sum of
(a) the aggregate Certificate Principal Balance of the Class A
Certificates
(after taking into account distribution of the Class 1-A
Principal
Distribution Amount and the Class 2-A Principal Distribution Amount
for such
Distribution Date), (b) the aggregate Certificate Principal Balance
of the
Class M-1, Class M-2 and Class M-3 Certificates (after taking into
account
distribution of the Combined Class M-1, M-2 and M-3 Principal
Distribution
Amount for such Distribution Date), (c) the aggregate Certificate
Principal
Balance of any Classes of Subordinate Certificates (other than the
Class M-1,
Class M-2 and Class M-3 Certificates) that are senior to the
subject Class (in
each case, after taking into account distribution of the
Subordinate Class
Principal Distribution Amount(s) for such senior Class(es) of
Certificates for
such Distribution Date) and (d) the Certificate Principal Balance
of the
subject Class of Subordinate Certificates immediately prior to
such
Distribution Date over (2) the lesser of (a) the product of (x)
100% minus the
Stepdown Target Subordination Percentage for the subject Class of
Certificates
and (y) the aggregate Stated Principal Balance of the Mortgage
Loans for such
Distribution Date and (b) the aggregate Stated Principal Balance of
the
Mortgage Loans for such Distribution Date minus the OC Floor;
provided,
however, that if such Class of Subordinate Certificates is the only
Class of
Subordinate Certificates outstanding on such Distribution Date,
that Class
will be entitled to receive the entire remaining Principal
Distribution Amount
for Loan Group 1 and Loan Group 2 until the Certificate Principal
Balance
thereof is reduced to zero.
Subordinate Net Rate Cap: With respect to any Distribution Date
and
each Class of Subordinate Certificates, the weighted average of the
Class 1-A
Net Rate Cap and the Class 2-A Net Rate Cap, weighted on the basis
of the
excess (if any) of the sum of the aggregate Stated Principal
Balance of the
Mortgage Loans in the related Loan Group as of the first day of the
related
Due Period (after giving effect to Principal Prepayments received
during the
Prepayment Period that ends during such Due Period) and the amount
on deposit
in the Pre-Funding Account in respect of that Loan Group as of the
first day
of such Due Period over the Certificate Principal Balance of the
related
Senior Certificates immediately prior to such Distribution
Date.
Subsequent Certificate Account Deposit: With respect to any
Subsequent Transfer Date, an amount equal to the aggregate of all
amounts in
respect of (i) principal of the related Subsequent Mortgage Loans
due after
the related Subsequent Cut-off Date and received by the Master
Servicer on or
before such Subsequent Transfer Date and not applied in computing
the Cut-off
Date Principal Balance thereof and (ii) interest on such Subsequent
Mortgage
Loans due after such Subsequent Cut-off Date and received by the
Master
Servicer on or before the Subsequent Transfer Date.
Subsequent Cut-off Date: In the case of any Subsequent Mortgage
Loan, the later of (x) the first day of the month of the related
Subsequent
Transfer Date and (y) the date of origination of such Subsequent
Mortgage
Loan.
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Subsequent Mortgage Loan: Any Mortgage Loan conveyed to the
Trustee
on a Subsequent Transfer Date, and listed on the related Loan
Number and
Borrower Identification Mortgage Loan Schedule delivered pursuant
to Section
2.01(f). When used with respect to a single Subsequent Transfer
Date,
"Subsequent Mortgage Loan" shall mean a Subsequent Mortgage Loan
conveyed to
the Trustee on such Subsequent Transfer Date.
Subsequent Periodic Rate Cap: With respect to each Adjustable
Rate
Mortgage Loan, the percentage specified in the related Mortgage
Note that
limits permissible increases and decreases in the Mortgage Rate on
any
Adjustment Date (other than the initial Adjustment Date).
Subsequent Recoveries: As to any Distribution Date, with respect
to
a Liquidated Mortgage Loan that resulted in a Realized Loss in a
prior
calendar month, unexpected amounts received by the Master Servicer
(net of any
related expenses permitted to be reimbursed pursuant to Section
3.08 and 3.12)
specifically related to such Liquidated Mortgage Loan after the
classification
of such Mortgage Loan as a Liquidated Mortgage Loan.
Subsequent Transfer Agreement: A Subsequent Transfer Agreement
substantially in the form of Exhibit P hereto, executed and
delivered by the
Sellers, the Depositor and the Trustee as provided in Section
2.01(d).
Subsequent Transfer Date: For any Subsequent Transfer Agreement,
the
"Subsequent Transfer Date" identified in such Subsequent Transfer
Agreement;
provided, however, the Subsequent Transfer Date for any Subsequent
Transfer
Agreement must be a Business Day and may not be a date earlier than
the date
on which the Subsequent Transfer Agreement is executed and
delivered by the
parties thereto pursuant to Section 2.01(d).
Subsequent Transfer Date Purchase Amount: With respect to any
Subsequent Transfer Date, the "Subsequent Transfer Date Purchase
Amount"
identified in the related Subsequent Transfer Agreement which shall
be an
estimate of the aggregate Stated Principal Balances of the
Subsequent Mortgage
Loans identified in such Subsequent Transfer Agreement.
Subsequent Transfer Date Transfer Amount: With respect to any
Subsequent Transfer Date, an amount equal to the lesser of (i) the
aggregate
Stated Principal Balances as of the related Subsequent Cut-off
Dates of the
Subsequent Mortgage Loans conveyed on such Subsequent Transfer
Date, as listed
on the related Loan Number and Borrower Identification Mortgage
Loan Schedule
delivered pursuant to Section 2.01(f) and (ii) the amount on
deposit in the
Pre-Funding Account.
Subservicer: As defined in Section 3.02(a).
Subservicing Agreement: As defined in Section 3.02(a).
Substitution Adjustment Amount: The meaning ascribed to such
term
pursuant to Section 2.03(e).
Substitution Amount: With respect to any Mortgage Loan
substituted
pursuant to Section 2.03(e), the excess of (x) the principal
balance of the
Mortgage Loan that is substituted
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for, over (y) the principal balance of the related substitute
Mortgage Loan,
each balance being determined as of the date of substitution.
Successful Auction: An auction held pursuant to Section 9.04 at
which at least three Qualified Bidders submitted bids and at least
one of
those bids was an Acceptable Bid Amount.
Swap Account: The separate Eligible Account created and
initially
maintained by the Swap Trustee pursuant to Section 4.09.
Swap Contract: The transaction evidenced by the Confirmation
(as
assigned to the Swap Contract Administrator pursuant to the Swap
Contract
Assignment Agreement), a form of which is attached hereto as
Exhibit U.
Swap Contract Administration Agreement: The swap contract
administration agreement dated as of the Closing Date among CHL,
the Trustee
and the Swap Contract Administrator, a form of which is attached
hereto as
Exhibit V-2.
Swap Contract Administrator: The Bank of New York, in its
capacity
as swap contract administrator under the Swap Contract
Administration
Agreement and its successors and assigns.
Swap Contract Assignment Agreement: The Assignment Agreement
dated
as of the Closing Date among CHL, the Swap Contract Administrator
and the Swap
Counterparty, a form of which is attached hereto as Exhibit
V-1.
Swap Contract Termination Date: The Distribution Date in
November
2011.
Swap Counterparty: Bear Stearns Financial Products Inc. and its
successors.
Swap Counterparty Trigger Event: Either (i) an "Event of
Default"
under the Swap Contract with respect to which the Swap Counterparty
is the
sole "Defaulting Party" (as defined in the Swap Contract) or (ii)
a
"Termination Event" (other than an Illegality or a Tax Event (as
such terms
are defined in the Swap Contract)) or "Additional Termination
Event" under the
Swap Contract with respect to which the Swap Counterparty is the
sole
"Affected Party" (as defined in the Swap Contract).
Swap-IO REMIC: As defined in the Preliminary Statement.
Swap Termination Payment: The payment payable to either party
under
the Swap Contract due to an early termination of the Swap
Contract.
Swap Trust: The trust fund established by Section 4.09.
Swap Trustee: The Bank of New York, a New York banking
corporation,
not in its individual capacity, but solely in its capacity as
trustee for the
benefit of the Holders of the Interest-Bearing Certificates under
this
Agreement, and any successor thereto, and any corporation or
national banking
association resulting from or surviving any consolidation or
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<PAGE>
merger to which it or its successors may be a party and any
successor trustee
as may from time to time be serving as successor trustee
hereunder.
Tax Matters Person: The person designated as "tax matters person"
in
the manner provided under Treasury regulation ss. 1.860F-4(d) and
Treasury
regulation ss. 301.6231(a)(7)-1. Initially, this person shall be
the Trustee.
Tax Matters Person Certificate: With respect to the Master
REMIC,
the Strip REMIC and the Swap-IO REMIC, the Class A-R Certificate
with a
Denomination of $0.05 and in the form of Exhibit E hereto.
Termination Price: As defined in Section 9.01.
Terminator: As defined in Section 9.01.
Three-Year Hybrid Mortgage Loan: A Mortgage Loan having a
Mortgage
Rate that is fixed for 36 months after origination thereof before
such
Mortgage Rate becomes subject to adjustment.
Transaction Documents: This Agreement, the Swap Contract, the
Swap
Contract Administration Agreement, each Mortgage Insurance Policy
and any
other document or agreement entered into in connection with the
Trust Fund,
the Certificates or the Mortgage Loans.
Transfer: Any direct or indirect transfer or sale of any
Ownership
Interest in a Certificate.
Transfer Affidavit: As defined in Section 5.02(c).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: With respect to any Distribution Date on or after
the
Stepdown Date, either a Delinquency Trigger Event with respect to
that
Distribution Date or a Cumulative Loss Trigger Event with respect
to that
Distribution Date.
Trust Fund: The corpus of the trust created hereunder consisting
of
(i) the Mortgage Loans and all interest and principal received on
or with
respect thereto after the Cut-off Date to the extent not applied in
computing
the Cut-off Date Principal Balance thereof, exclusive of interest
not required
to be deposited in the Certificate Account pursuant to Section
3.05(b)(2);
(ii) the Certificate Account, the Distribution Account, the
Principal Reserve
Fund, the Carryover Reserve Fund, the Credit Comeback Excess
Account, the
Pre-Funding Account and all amounts deposited therein pursuant to
the
applicable provisions of this Agreement; (iii) property that
secured a
Mortgage Loan and has been acquired by foreclosure, deed in lieu
of
foreclosure or otherwise; (iv) the mortgagee's rights under the
Insurance
Policies with respect to the Mortgage Loan; and (v) all proceeds of
the
conversion, voluntary or involuntary, of any of the foregoing into
cash or
other liquid property.
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Trustee: The Bank of New York, a New York banking corporation,
not
in its individual capacity, but solely in its capacity as trustee
for the
benefit of the Certificateholders under this Agreement, and any
successor
thereto, and any corporation or national banking association
resulting from or
surviving any consolidation or merger to which it or its successors
may be a
party and any successor trustee as may from time to time be serving
as
successor trustee hereunder.
Trustee Advance Notice: As defined in Section 4.01(d).
Trustee Advance Rate: With respect to any Advance made by the
Trustee pursuant to Section 4.01(d), a per annum rate of interest
determined
as of the date of such Advance equal to the Prime Rate in effect on
such date
plus 5.00%.
Trustee Fee: As to any Distribution Date, an amount equal to
one-twelfth of the Trustee Fee Rate multiplied by the sum of (i)
the Pool
Stated Principal Balance and (ii) any amounts remaining in the
Pre-Funding
Account (excluding any investment earnings thereon) with respect to
such
Distribution Date.
Trustee Fee Rate: With respect to each Mortgage Loan, the per
annum
rate agreed upon in writing on or prior to the Closing Date by the
Trustee and
the Depositor, which is 0.009% per annum.
Two-Year Hybrid Mortgage Loan: A Mortgage Loan having a
Mortgage
Rate that is fixed for 24 months after origination thereof before
such
Mortgage Rate becomes subject to adjustment.
Underwriter's Exemption: Prohibited Transaction Exemption
2002-41,
67 Fed. Reg. 54487 (2002), as amended (or any successor thereto),
or any
substantially similar administrative exemption granted by the U.S.
Department
of Labor.
Underwriters: Countrywide Securities Corporation, Greenwich
Capital
Markets, Inc. and J.P. Morgan Securities Inc.
Unpaid Realized Loss Amount: For any Class of Certificates and
any
Distribution Date, (x) the portion of the aggregate Applied
Realized Loss
Amount previously allocated to that Class remaining unpaid from
prior
Distribution Dates minus (y) any increase in the Certificate
Principal Balance
of that Class due to the allocation of Subsequent Recoveries to
the
Certificate Principal Balance of that Class pursuant to Section
4.04(h).
Voting Rights: The voting rights of all the Certificates that
are
allocated to any Certificates for purposes of the voting provisions
hereunder.
Voting Rights allocated to each Class of Certificates shall be
allocated 97%
to the Certificates other than the Class A-R, Class C and Class P
Certificates
(with the allocation among the Certificates to be in proportion to
the
Certificate Principal Balance of each Class relative to the
Certificate
Principal Balance of all other such Classes), and 1% to each of the
Class A-R,
Class C and Class P Certificates. Voting Rights will be allocated
among the
Certificates of each such Class in accordance with their respective
Percentage
Interests.
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Winning Bidder: With respect to a Successful Auction, the
Qualified
Bidder that bids the highest price.
Section 1.02 Certain Interpretive Provisions.
All terms defined in this Agreement shall have the defined
meanings
when used in any certificate, agreement or other document delivered
pursuant
hereto unless otherwise defined therein. For purposes of this
Agreement and
all such certificates and other documents, unless the context
otherwise
requires: (a) accounting terms not otherwise defined in this
Agreement, and
accounting terms partly defined in this Agreement to the extent not
defined,
shall have the respective meanings given to them under generally
accepted
accounting principles; (b) the words "hereof," "herein" and
"hereunder" and
words of similar import refer to this Agreement (or the
certificate, agreement
or other document in which they are used) as a whole and not to any
particular
provision of this Agreement (or such certificate, agreement or
document); (c)
references to any Section, Schedule or Exhibit are references to
Sections,
Schedules and Exhibits in or to this Agreement, and references to
any
paragraph, subsection, clause or other subdivision within any
Section or
definition refer to such paragraph, subsection, clause or other
subdivision of
such Section or definition; (d) the term "including" means
"including without
limitation"; (e) references to any law or regulation refer to that
law or
regulation as amended from time to time and include any successor
law or
regulation; (f) references to any agreement refer to that agreement
as amended
from time to time; (g) references to any Person include that
Person's
permitted successors and assigns; and (h) a Mortgage Loan is "30
days
delinquent" if a Scheduled Payment has not been received by the
close of
business on the Due Date on which the next Scheduled Payment is
due. Similarly
for "60 days delinquent," "90 days delinquent" and so on.
ARTICLE II.
CONVEYANCE OF
MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans.
(a) Each Seller hereby sells, transfers, assigns, sets over and
otherwise conveys to the Depositor, without recourse, all the
right, title and
interest of such Seller in and to the applicable Initial Mortgage
Loans,
including all interest and principal received and receivable by
such Seller on
or with respect to applicable Initial Mortgage Loans after the
Initial Cut-off
Date (to the extent not applied in computing the Cut-off Date
Principal
Balance thereof) or deposited into the Certificate Account by the
Master
Servicer on behalf of such Seller as part of the Initial
Certificate Account
Deposit as provided in this Agreement, other than principal due on
the
applicable Initial Mortgage Loans on or prior to the Initial
Cut-off Date and
interest accruing prior to the Initial Cut-off Date. The Master
Servicer
confirms that, on behalf of the Sellers, concurrently with the
transfer and
assignment, it has deposited into the Certificate Account the
Initial
Certificate Account Deposit.
Immediately upon the conveyance of the Initial Mortgage Loans
referred to in the preceding paragraph, the Depositor sells,
transfers,
assigns, sets over and otherwise conveys to
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<PAGE>
the Trustee for benefit of the Certificateholders, without
recourse, all
right, title and interest in and to the Initial Mortgage Loans.
CHL further agrees (x) to cause The Bank of New York to enter
into
the Swap Contract Administration Agreement as Swap Contract
Administrator and
(y) to assign all of its right, title and interest in and to the
interest rate
swap transaction evidenced by the Confirmation, and to cause all of
its
obligations in respect of such transaction to be assumed by, the
Swap Contract
Administrator, on the terms and conditions set forth in the Swap
Contract
Assignment Agreement.
(b) Subject to the execution and delivery of the related
Subsequent
Transfer Agreement as provided by Section 2.01(d) and the terms and
conditions
of this Agreement, each Seller sells, transfers, assigns, sets over
and
otherwise conveys to the Depositor, without recourse, on each
Subsequent
Transfer Date, all the right, title and interest of such Seller in
and to the
related Subsequent Mortgage Loans, including all interest and
principal
received and receivable by such Seller on or with respect to such
Subsequent
Mortgage Loans after the related Subsequent Cut-off Date (to the
extent not
applied in computing the Cut-off Date Principal Balance thereof) or
deposited
into the Certificate Account by the Master Servicer on behalf of
such Seller
as part of any related Subsequent Certificate Account Deposit as
provided in
this Agreement, other than principal due on such Subsequent
Mortgage Loans on
or prior to the related Subsequent Cut-off Date and interest
accruing prior to
the related Subsequent Cut-off Date.
Immediately upon the conveyance of the Subsequent Mortgage
Loans
referred to in the preceding paragraph, the Depositor sells,
transfers,
assigns, sets over and otherwise conveys to the Trustee for benefit
of the
Certificateholders, without recourse, all right, title and interest
in the
Subsequent Mortgage Loans.
(c) Each Seller has entered into this Agreement in consideration
for
the purchase of the Mortgage Loans by the Depositor and has agreed
to take the
actions specified herein. The Depositor, concurrently with the
execution and
delivery of this Agreement, hereby sells, transfers, assigns and
otherwise
conveys to the Trustee for the use and benefit of the
Certificateholders,
without recourse, all right, title and interest in the portion of
the Trust
Fund not otherwise conveyed to the Trustee pursuant to Section
2.01(a) or (b).
(d) On any Business Day during the Funding Period designated by
CHL
to the Trustee, the Sellers, the Depositor and the Trustee shall
complete,
execute and deliver a Subsequent Transfer Agreement. After the
execution and
delivery of such Subsequent Transfer Agreement, on the Subsequent
Transfer
Date, the Trustee shall set aside in the Pre-Funding Account an
amount equal
to the related Subsequent Transfer Date Purchase Amount.
(e) The transfer of
Subsequent Mortgage Loans on the Subsequent
Transfer Date is subject to the satisfaction of each of the
following
conditions:
(1) the Trustee and the Underwriters will be provided Opinions
of
Counsel addressed to the Rating Agencies as with respect to the
sale
of
the Subsequent Mortgage Loans conveyed on such Subsequent
Transfer
Date
(such opinions being
56
<PAGE>
substantially similar to the opinions delivered on the Closing Date
to
the
Rating Agencies with respect to the sale of the Initial
Mortgage
Loans on the Closing Date), to be delivered as provided in
Section
2.01(f);
(2) the execution and delivery of such Subsequent Transfer
Agreement or conveyance of the related Subsequent Mortgage Loans
does not
result in a reduction or withdrawal of any ratings assigned to
the
Certificates by the Rating Agencies;
(3) the Depositor shall deliver to the Trustee an Officer's
Certificate confirming the satisfaction of each of the conditions
set
forth in this Section 2.01(e) required to be satisfied by such
Subsequent
Transfer Date;
(4) each Subsequent Mortgage Loan conveyed on such Subsequent
Transfer Date satisfies the representations and warranties
applicable to
it
under this Agreement, provided, however, that with respect to a
breach
of a
representation and warranty with respect to a Subsequent
Mortgage
Loan
set forth in this clause (4), the obligation under Section
2.03(e)
of
this Agreement of the applicable Seller, to cure, repurchase or
replace such Subsequent Mortgage Loan shall constitute the sole
remedy
against such Seller respecting such breach available to
Certificateholders, the Depositor or the Trustee;
(5) the Subsequent Mortgage Loans conveyed on such Subsequent
Transfer Date were selected in a manner reasonably believed not to
be
adverse to the interests of the Certificateholders;
(6) no Subsequent Mortgage Loan conveyed on such Subsequent
Transfer Date was 30 or more days delinquent as of the related
Cut-off
Date;
(7) following the conveyance of the Subsequent Mortgage Loans
on
such Subsequent Transfer Date, the characteristics of each Loan
Group
will
not vary by more than the amount specified below (other than (i)
the
percentage of Mortgage Loans secured by Mortgaged Properties
located in
the
State of California, which will not exceed 50% of the Mortgage
Loans
in
each Loan Group and (ii) the percentage of Mortgage Loans in
the
Credit Grade Categories of "C" or below, which will not exceed 15%
of the
Mortgage Loans in each Loan Group) from the characteristics listed
below;
provided that for the purpose of making such calculations, the
characteristics for any Initial Mortgage Loan made will be taken as
of
the
Initial Cut-off Date and the characteristics for any Subsequent
Mortgage Loans will be taken as of the Subsequent Cut-off Date:
<TABLE>
<CAPTION>
Loan
Group 1
Characteristic
Value
Permitted Variance
-----------------------
----------------
--------------------------
<S>
<C>
<C>
Weighted Average Mortgage Rate.........................
8.304%
0.10%
Weighted Average Original Loan-to-Value Ratio..........
80.42%
3.00%
Weighted Average Credit Bureau Risk Score..............
597 points
5 points
Percentage Originated under CHL's Full Documentation
Program................................................
67.54%
3.00%
57
<PAGE>
Weighted Average Gross Margin of
Adjustable Rate Mortgage Loans.........................
6.557%
0.10%
Loan
Group 2
Characteristic
Value
Permitted Variance
-----------------------
----------------
--------------------------
Weighted Average Mortgage Rate.........................
8.258%
0.10%
Weighted Average Original Loan-to-Value Ratio..........
82.18%
3.00%
Weighted Average Credit Bureau Risk Score..............
619 points
5 points
Percentage Originated under CHL's Full Documentation
Program................................................
56.81%
3.00%
Weighted Average Gross Margin of
Adjustable Rate Mortgage Loans.........................
5.944%
0.10%
</TABLE>
(8) none of the Sellers or the Depositor is insolvent and
neither of the Sellers nor the Depositor will be rendered insolvent
by
the
conveyance of Subsequent Mortgage Loans on such Subsequent
Transfer
Date; and
(9) the Trustee and the Underwriters will be provided with an
Opinion of Counsel, which Opinion of Counsel shall not be at the
expense
of
either the Trustee or the Trust Fund, addressed to the Trustee, to
the
effect that such purchase of Subsequent Mortgage Loans will not
(i)
result in the imposition of the tax on "prohibited transactions" on
the
Trust Fund or contributions after the Startup Date, as defined
in
Sections 860F(a)(2) and 860G(d) of the Code, respectively or (ii)
cause
any
REMIC formed hereunder to fail to qualify as a REMIC, such opinion
to
be
delivered as provided in Section 2.01(f).
The Trustee shall not be required to investigate or otherwise
verify
compliance with these conditions, except for its own receipt of
documents
specified above, and shall be entitled to rely on the required
Officer's
Certificate.
(f) Within six Business Days after each Subsequent Transfer
Date,
upon (1) delivery to the Trustee by the Depositor of the Opinions
of Counsel
referred to in Section 2.01(e)(1) and (e)(9), (2) delivery to the
Trustee by
CHL (on behalf of each Seller) of a Loan Number and Borrower
Identification
Mortgage Loan Schedule reflecting the Subsequent Mortgage Loans
conveyed on
such Subsequent Transfer Date and the Loan Group into which each
Subsequent
Mortgage Loan was conveyed, (3)deposit in the Certificate Account
by the
Master Servicer on behalf of the Sellers of the applicable
Subsequent
Certificate Account Deposit, and (4) delivery to the Trustee by the
Depositor
of an Officer's Certificate confirming the satisfaction of each of
the
conditions precedent set forth in this Section 2.01(f), the Trustee
shall pay
the applicable Seller the Subsequent Transfer Date Transfer Amount
from such
funds that were set aside in the Pre-Funding Account pursuant to
Section
2.01(d). The positive difference, if any, between the Subsequent
Transfer Date
Transfer Amount and the Subsequent Transfer Date Purchase Amount
shall be
re-invested by the Trustee in the Pre-Funding Account.
58
<PAGE>
The Trustee shall not be required to investigate or otherwise
verify
compliance with the conditions set forth in the preceding
paragraph, except
for its own receipt of documents specified above, and shall be
entitled to
rely on the required Officer's Certificate.
Within thirty days after each Subsequent Transfer Date, the
Depositor shall deliver to the Trustee a letter of a nationally
recognized
firm of independent public accountants stating whether or not the
Subsequent
Mortgage Loans conveyed on such Subsequent Transfer Date conform to
the
characteristics described in Section 2.01(e)(6) and (7).
(g) In connection with the transfer and assignment of each
Mortgage
Loan, the Depositor has delivered to, and deposited with, the
Co-Trustee (or,
in the case of the Delay Delivery Mortgage Loans, will deliver to,
and deposit
with, the Co-Trustee within the time periods specified in the
definition of
Delay Delivery Mortgage Loans) (except as provided in clause (vi)
below) for
the benefit of the Certificateholders, the following documents or
instruments
with respect to each such Mortgage Loan so assigned (with respect
to each
Mortgage Loan, clause (i) through (vi) below, together, the
"Mortgage File"
for each such Mortgage Loan):
(i) the original Mortgage Note, endorsed by manual or facsimile
signature
in blank in the following form: "Pay to the order of
________________ without recourse", with all intervening
endorsements that show a complete chain of endorsement from the
originator to the Person endorsing the Mortgage Note (each such
endorsement being sufficient to transfer all right, title and
interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note), or, if the original
Mortgage
Note has been
lost or destroyed and not replaced, an original lost
note affidavit, stating that the original Mortgage Note was lost
or
destroyed, together with a copy of the related Mortgage Note and
all
such intervening endorsements;
(ii) in the case of each Mortgage Loan that is not a MERS
Mortgage Loan, the original recorded Mortgage or a copy of such
Mortgage, with recording information, and in the case of each
MERS
Mortgage Loan, the original Mortgage or a copy of such
Mortgage,
with recording information, noting the presence of the MIN of
the
Mortgage Loan and language indicating that the Mortgage Loan is
a
MOM Loan if the Mortgage Loan is a MOM Loan, with evidence of
recording indicated thereon, or a copy of the Mortgage certified
by
the public recording office in which such Mortgage has been
recorded;
(iii) in the case of each Mortgage Loan that is not a MERS
Mortgage Loan, a duly executed assignment of the Mortgage to
"Asset-Backed Certificates, Series 2006-23, CWABS, Inc., by The
Bank
of New York, a New York banking corporation, as trustee under
the
Pooling and Servicing Agreement dated as of November 1, 2006,
without recourse" or a copy of such assignment, with recording
information, (each such assignment, when duly and validly
completed,
to be in recordable form and sufficient to effect the assignment
of
and transfer to the assignee thereof, under the Mortgage to
which
such assignment relates);
59
<PAGE>
(iv) the original recorded assignment or assignments of the
Mortgage or a copy of such assignments, with recording
information,
together with all interim recorded assignments of such Mortgage or
a
copy of such assignments, with recording information (in each
case
noting the presence of a MIN in the case of each MERS Mortgage
Loan);
(v) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(vi) the original or duplicate original lender's title policy
or a copy of lender's title policy or a printout of the
electronic
equivalent and all riders thereto or, in the event such
original
title policy has not been received from the insurer, such
original
or duplicate original lender's title policy and all riders
thereto
shall be delivered within one year of the Closing Date.
In addition, in connection with the assignment of any MERS
Mortgage
Loan, each Seller agrees that it will cause, at such Seller's own
expense, the
MERS(R) System to indicate (and provide evidence to the Trustee
that it has
done so) that such Mortgage Loans have been assigned by such Seller
to the
Trustee in accordance with this Agreement for the benefit of
the
Certificateholders by including (or deleting, in the case of
Mortgage Loans
which are repurchased in accordance with this Agreement) in such
computer
files (a) the code "[IDENTIFY TRUSTEE SPECIFIC CODE]" in the field
"[IDENTIFY
THE FIELD NAME FOR TRUSTEE]" which identifies the Trustee and (b)
the code
"[IDENTIFY SERIES SPECIFIC CODE NUMBER]" in the field "Pool Field"
which
identifies the series of the Certificates issued in connection with
such
Mortgage Loans. The Sellers further agree that they will not, and
will not
permit the Master Servicer to, and the Master Servicer agrees that
it will
not, alter the codes referenced in this paragraph with respect to
any Mortgage
Loan during the term of this Agreement unless and until such
Mortgage Loan is
repurchased in accordance with the terms of this Agreement.
In the event that in connection with any Mortgage Loan that is not
a
MERS Mortgage Loan a Seller cannot deliver the original recorded
Mortgage or
all interim recorded assignments of the Mortgage satisfying the
requirements
of clause (ii), (iii) or (iv) concurrently with the execution and
delivery
hereof, such Seller shall deliver or cause to be delivered to the
Co-Trustee a
true copy of such Mortgage and of each such undelivered interim
assignment of
the Mortgage each certified by such Seller, the applicable title
company,
escrow agent or attorney, or the originator of such Mortgage, as
the case may
be, to be a true and complete copy of the original Mortgage or
assignment of
Mortgage submitted for recording. For any such Mortgage Loan that
is not a
MERS Mortgage Loan each Seller shall promptly deliver or cause to
be delivered
to the Co-Trustee such original Mortgage and such assignment or
assignments
with evidence of recording indicated thereon upon receipt thereof
from the
public recording official, or a copy thereof, certified, if
appropriate, by
the relevant recording office, but in no event shall any such
delivery be made
later than 270 days following the Closing Date; provided that in
the event
that by such date such Seller is unable to deliver or cause to be
delivered
each such Mortgage and each interim assignment by reason of the
fact that any
such documents have not been returned by the appropriate recording
office, or,
in the case of each interim assignment, because the related
Mortgage has not
been returned by the appropriate recording office, such
60
<PAGE>
Seller shall deliver or cause to be delivered such documents to the
Co-Trustee
as promptly as possible upon receipt thereof. If the public
recording office
in which a Mortgage or interim assignment thereof is recorded
retains the
original of such Mortgage or assignment, a copy of the original
Mortgage or
assignment so retained, with evidence of recording thereon,
certified to be
true and complete by such recording office, shall satisfy a
Seller's
obligations in Section 2.01. If any document submitted for
recording pursuant
to this Agreement is (x) lost prior to recording or rejected by the
applicable
recording office, the applicable Seller shall immediately prepare
or cause to
be prepared a substitute and submit it for recording, and shall
deliver copies
and originals thereof in accordance with the foregoing or (y) lost
after
recording, the applicable Seller shall deliver to the Co-Trustee a
copy of
such document certified by the applicable public recording office
to be a true
and complete copy of the original recorded document. Each Seller
shall
promptly forward or cause to be forwarded to the Co-Trustee (x)
from time to
time additional original documents evidencing an assumption or
modification of
a Mortgage Loan and (y) any other documents required to be
delivered by the
Depositor or the Master Servicer to the Co-Trustee within the time
periods
specified in this Section 2.01.
With respect to each Mortgage Loan other than a MERS Mortgage
Loan
as to which the related Mortgaged Property and Mortgage File are
located in
any jurisdiction under the laws of which the recordation of the
assignment
specified in clause (iii) above is not necessary to protect the
Trustee's and
the Certificateholders' interest in the related Mortgage Loan, as
evidenced by
an Opinion of Counsel delivered by CHL to the Trustee within 90
days of the
Closing Date (which opinion may be in the form of a "survey"
opinion and is
not required to be delivered by counsel admitted to practice law in
the
jurisdiction as to which such opinion applies), in lieu of
recording the
assignment specified in clause (iii) above, the applicable Seller
may deliver
an unrecorded assignment in blank, in form otherwise suitable for
recording to
the Co-Trustee; provided that if the related Mortgage has not been
returned
from the applicable public recording office, such assignment, or
any copy
thereof, of the Mortgage may exclude the information to be provided
by the
recording office. As to any Mortgage Loan other than a MERS
Mortgage Loan, the
procedures of the preceding sentence shall be applicable only so
long as the
related Mortgage File is maintained in the possession of the
Co-Trustee in the
State or jurisdiction described in such sentence. In the event that
with
respect to Mortgage Loans other than MERS Mortgage Loans (I) any
Seller, the
Depositor, the Master Servicer or the NIM Insurer gives written
notice to the
Trustee that recording is required to protect the right, title and
interest of
the Trustee on behalf of the Certificateholders in and to any
Mortgage Loan,
(II) a court recharacterizes any sale of the Mortgage Loans as a
financing, or
(III) as a result of any change in or amendment to the laws of the
State or
jurisdiction described in the first sentence of this paragraph or
any
applicable political subdivision thereof, or any change in official
position
regarding application or interpretation of such laws, including a
holding by a
court of competent jurisdiction, such recording is so required, the
Co-Trustee
shall complete the assignment in the manner specified in clause
(iii) above
and CHL shall submit or cause to be submitted for recording as
specified above
or, should CHL fail to perform such obligations, the Trustee shall
cause the
Master Servicer, at the Master Servicer's expense, to cause each
such
previously unrecorded assignment to be submitted for recording as
specified
above. In the event a Mortgage File is released to the Master
Servicer as a
result of the Master Servicer's having completed a Request for
Document
Release, the Trustee shall complete the assignment of the related
Mortgage in
the manner specified in clause (iii) above.
61
<PAGE>
So long as the Co-Trustee or its agent maintains an office in
the
State of California, the Co-Trustee or its agent shall maintain
possession of
and not remove or attempt to remove from the State of California
any of the
Mortgage Files as to which the related Mortgaged Property is
located in such
State. In the event that a Seller fails to record an assignment of
a Mortgage
Loan as herein provided within 90 days of notice of an event set
forth in
clause (I), (II) or (III) of the preceding paragraph, the Master
Servicer
shall prepare and, if required hereunder, file such assignments
for
recordation in the appropriate real property or other records
office. Each
Seller hereby appoints the Master Servicer (and any successor
servicer
hereunder) as its attorney-in-fact with full power and authority
acting in its
stead for the purpose of such preparation, execution and
filing.
In the case of Mortgage Loans that become the subject of a
Principal
Prepayment between the Closing Date (in the case of Initial
Mortgage Loans) or
related Subsequent Transfer Date (in the case of Subsequent
Mortgage Loans)
and the Cut-off Date, CHL shall deposit or cause to be deposited in
the
Certificate Account the amount required to be deposited therein
with respect
to such payment pursuant to Section 3.05 hereof.
Notwithstanding anything to the contrary in this Agreement,
within
thirty days after the Closing Date (in the case of Initial Mortgage
Loans) or
within twenty days after the related Subsequent Transfer Date (in
the case of
Subsequent Mortgage Loans), CHL (on behalf of each Seller) shall
either (i)
deliver to the Co-Trustee the Mortgage File as required pursuant to
this
Section 2.01 for each Delay Delivery Mortgage Loan or (ii) (A)
repurchase the
Delay Delivery Mortgage Loan or (B) substitute the Delay Delivery
Mortgage
Loan for a Replacement Mortgage Loan, which repurchase or
substitution shall
be accomplished in the manner and subject to the conditions set
forth in
Section 2.03, provided that if CHL fails to deliver a Mortgage File
for any
Delay Delivery Mortgage Loan within the period provided in the
prior sentence,
the cure period provided for in Section 2.02 or in Section 2.03
shall not
apply to the initial delivery of the Mortgage File for such Delay
Delivery
Mortgage Loan, but rather CHL shall have five (5) Business Days to
cure such
failure to deliver. CHL shall promptly provide each Rating Agency
with written
notice of any cure, repurchase or substitution made pursuant to the
proviso of
the preceding sentence. On or before the thirtieth (30th) day (or
if such
thirtieth day is not a Business Day, the succeeding Business Day)
after the
Closing Date (in the case of Initial Mortgage Loans) or within
twenty days
after the related Subsequent Transfer Date (in the case of
Subsequent Mortgage
Loans), the Trustee shall, in accordance with the provisions of
Section 2.02,
send a Delay Delivery Certification substantially in the form
annexed hereto
as Exhibit G-3 (with any applicable exceptions noted thereon) for
all Delay
Delivery Mortgage Loans delivered within thirty (30) days after
such date. The
Trustee will promptly send a copy of such Delay Delivery
Certification to each
Rating Agency.
Each Seller has entered into this Agreement in consideration for
the
purchase of the Mortgage Loans sold by such Seller to the Depositor
and has
agreed to take the actions specified herein. The Depositor,
concurrently with
the execution and delivery of this Agreement, hereby sells,
transfers, assigns
and otherwise conveys to the Trustee for the use and benefit of
the
Certificateholders, without recourse, all right, title and interest
in the
portion of the Trust Fund not otherwise conveyed to the Trustee
pursuant to
Sections 2.01(a) or (b).
62
<PAGE>
Section 2.02 Acceptance by Trustee of the Mortgage Loans.
(a) The Co-Trustee acknowledges receipt, subject to the
limitations
contained in and any exceptions noted in the Initial Certification
in the form
annexed hereto as Exhibit G-1 and in the list of exceptions
attached thereto,
of the documents referred to in clauses (i) and (iii) of Section
2.01(g) above
with respect to the Initial Mortgage Loans and all other assets
included in
the Trust Fund and declares that it holds and will hold such
documents and the
other documents delivered to it constituting the Mortgage Files,
and that it
holds or will hold such other assets included in the Trust Fund, in
trust for
the exclusive use and benefit of all present and future
Certificateholders.
The Trustee agrees to execute and deliver on the Closing Date to
the
Depositor, the Master Servicer and CHL (on behalf of each Seller)
an Initial
Certification substantially in the form annexed hereto as Exhibit
G-1 to the
effect that, as to each Initial Mortgage Loan listed in the
Mortgage Loan
Schedule (other than any Initial Mortgage Loan paid in full or any
Initial
Mortgage Loan specifically identified in such certification as not
covered by
such certification), the documents described in Section 2.01(g)(i)
and, in the
case of each Initial Mortgage Loan that is not a MERS Mortgage
Loan, the
documents described in Section 2.01(g)(iii) with respect to such
Initial
Mortgage Loans as are in the Co-Trustee's possession and based on
its review
and examination and only as to the foregoing documents, such
documents appear
regular on their face and relate to such Initial Mortgage Loan. The
Trustee
agrees to execute and deliver within 30 days after the Closing Date
to the
Depositor, the Master Servicer and CHL (on behalf of each Seller)
an Interim
Certification substantially in the form annexed hereto as Exhibit
G-2 to the
effect that, as to each Initial Mortgage Loan listed in the
Mortgage Loan
Schedule (other than any Initial Mortgage Loan paid in full or any
Initial
Mortgage Loan specifically identified in such certification as not
covered by
such certification) all documents required to be delivered to the
Co-Trustee
pursuant to the Agreement with respect to such Initial Mortgage
Loans are in
its possession (except those documents described in Section
2.01(g)(vi)) and
based on its review and examination and only as to the foregoing
documents,
(i) such documents appear regular on their face and relate to such
Initial
Mortgage Loan, and (ii) the information set forth in items (i),
(iv), (v),
(vi), (viii), (ix) and (xv) of the definition of the "Mortgage Loan
Schedule"
accurately reflects information set forth in the Mortgage File. On
or before
the thirtieth (30th) day after the Closing Date (or if such
thirtieth day is
not a Business Day, the succeeding Business Day), the Trustee shall
deliver to
the Depositor, the Master Servicer and CHL (on behalf of each
Seller) a Delay
Delivery Certification with respect to the Initial Mortgage
Loans
substantially in the form annexed hereto as Exhibit G-3, with any
applicable
exceptions noted thereon. The Trustee or the Co-Trustee, as
applicable, shall
be under no duty or obligation to inspect, review or examine such
documents,
instruments, certificates or other papers to determine that the
same are
genuine, enforceable or appropriate for the represented purpose or
that they
have actually been recorded in the real estate records or that they
are other
than what they purport to be on their face.
Not later than 180 days after the Closing Date, the Trustee
shall
deliver to the Depositor, the Master Servicer, CHL (on behalf of
each Seller)
and any Certificateholder that so requests, a Final Certification
with respect
to the Initial Mortgage Loans substantially in the form annexed
hereto as
Exhibit H, with any applicable exceptions noted thereon.
63
<PAGE>
In connection with the Trustee's completion and delivery of
such
Final Certification, the Co-Trustee, at the direction of the
Trustee, shall
review each Mortgage File with respect to the Initial Mortgage
Loans to
determine that such Mortgage File contains the following
documents:
(i) the original Mortgage Note, endorsed by manual or facsimile
signature in blank in the following form: "Pay to the order of
________________ without recourse", with all intervening
endorsements that show a complete chain of endorsement from the
originator to the Person endorsing the Mortgage Note (each such
endorsement being sufficient to transfer all right, title and
interest of the party so endorsing, as noteholder or assignee
thereof, in and to that Mortgage Note), or, if the original
Mortgage
Note has been lost or destroyed and not replaced, an original
lost
note affidavit, stating that the original Mortgage Note was lost
or
destroyed,
together with a copy of the related Mortgage Note and all
such intervening endorsements;
(ii) in the case of each Initial Mortgage Loan that is not a
MERS Mortgage Loan, the original recorded Mortgage or a copy of
such
Mortgage, with recording information, and in the case of each
Initial Mortgage Loan that is a MERS Mortgage Loan, the
original
Mortgage or a copy of such Mortgage, with recording
information,
noting the presence of the MIN of the Initial Mortgage Loan and
language indicating that the Mortgage Loan is a MOM Loan if the
Initial Mortgage Loan is a MOM Loan, with evidence of recording
indicated thereon, or a copy of the Mortgage certified by the
public
recording office in which Mortgage has been recorded;
(iii) in the case of each Initial Mortgage Loan that is not a
MERS Mortgage Loan, a duly executed assignment of the Mortgage or
a
copy thereof with recording information, in either case in the
form
permitted by Section 2.01;
(iv) the original recorded assignment or assignments of the
Mortgage or a copy of such assignments, with recording
information,
together with all interim recorded assignments of such Mortgage or
a
copy of such assignments, with recording information (in each
case
noting the presence of a MIN in the case of each MERS Mortgage
Loan);
(v) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(vi) the original or duplicate original lender's title policy
or a copy of lender's title policy or a printout of the
electronic
equivalent and all riders thereto.
If, in the course of such review, the Co-Trustee finds any
document
or documents constituting a part of such Mortgage File that do not
meet the
requirements of clauses (i)-(iv) and (vi) above, the Trustee shall
include
such exceptions in such Final Certification (and the Trustee shall
state in
such Final Certification whether any Mortgage File does not then
include the
original or duplicate original lender's title policy or a printout
of the
electronic equivalent and all
64
<PAGE>
riders thereto). If the public recording office in which a Mortgage
or
assignment thereof is recorded retains the original of such
Mortgage or
assignment, a copy of the original Mortgage or assignment so
retained, with
evidence of recording thereon, certified to be true and complete by
such
recording office, shall be deemed to satisfy the requirements of
clause (ii),
(iii) or (iv) above, as applicable. CHL shall promptly correct or
cure such
defect referred to above within 90 days from the date it was so
notified of
such defect and, if CHL does not correct or cure such defect within
such
period, CHL shall either (A) if the time to cure such defect
expires prior to
the end of the second anniversary of the Closing Date, substitute
for the
related Initial Mortgage Loan a Replacement Mortgage Loan, which
substitution
shall be accomplished in the manner and subject to the conditions
set forth in
Section 2.03, or (B) purchase such Initial Mortgage Loan from the
Trust Fund
within 90 days from the date CHL was notified of such defect in
writing at the
Purchase Price of such Initial Mortgage Loan; provided that any
such
substitution pursuant to (A) above or repurchase pursuant to (B)
above shall
not be effected prior to the delivery to the Trustee of the Opinion
of Counsel
required by Section 2.05 hereof and any substitution pursuant to
(A) above
shall not be effected prior to the additional delivery to the
Co-Trustee of a
Request for File Release. No substitution will be made in any
calendar month
after the Determination Date for such month. The Purchase Price for
any such
Initial Mortgage Loan shall be deposited by CHL in the Certificate
Account
and, upon receipt of such deposit and Request for File Release with
respect
thereto, the Co-Trustee shall release the related Mortgage File to
CHL and
shall execute and deliver at CHL's request such instruments of
transfer or
assignment as CHL has prepared, in each case without recourse, as
shall be
necessary to vest in CHL, or a designee, the Trustee's interest in
any Initial
Mortgage Loan released pursuant hereto. If pursuant to the
foregoing
provisions CHL repurchases an Initial Mortgage Loan that is a MERS
Mortgage
Loan, the Master Servicer shall cause MERS to execute and deliver
an
assignment of the Mortgage in recordable form to transfer the
Mortgage from
MERS to CHL and shall cause such Mortgage to be removed from
registration on
the MERS(R) System in accordance with MERS' rules and
regulations.
The Co-Trustee shall retain possession and custody of each
Mortgage
File in accordance with and subject to the terms and conditions set
forth
herein. Each Seller shall promptly deliver to the Co-Trustee, upon
the
execution or receipt thereof, the originals of such other documents
or
instruments constituting the Mortgage File that come into the
possession of
such Seller from time to time.
It is understood and agreed that the obligation of CHL to
substitute
for or to purchase any Mortgage Loan that does not meet the
requirements of
Section 2.02(a) above shall constitute the sole remedy respecting
such defect
available to the Trustee, the Co-Trustee, the Depositor and any
Certificateholder against any Seller.
It is understood and agreed that the obligation of CHL to
substitute
for or to purchase, pursuant to Section 2.02(a), any Initial
Mortgage Loan
whose Mortgage File contains any document or documents that does
not meet the
requirements of clauses (i)-(iv) and (vi) above and which defect is
not
corrected or cured by CHL within 90 days from the date it was
notified of such
defect, shall constitute the sole remedy respecting such defect
available to
the Trustee, the Co-Trustee, the Depositor and any
Certificateholder against
any Seller.
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(b) The Trustee agrees to execute and deliver on the Subsequent
Transfer Date to the Depositor, the Master Servicer and CHL (on
behalf of each
Seller) an Initial Certification substantially in the form annexed
hereto as
Exhibit G-4 to the effect that, as to each Subsequent Mortgage Loan
listed in
the Mortgage Loan Schedule (other than any Subsequent Mortgage Loan
paid in
full or any Subsequent Mortgage Loan specifically identified in
such
certification as not covered by such certification), the documents
described
in Section 2.01(g)(i) and, in the case of each Subsequent Mortgage
Loan that
is not a MERS Mortgage Loan, the documents described in Section
2.01(g)(iii),
with respect to such Subsequent Mortgage Loan are in its
possession, and based
on its review and examination and only as to the foregoing
documents, such
documents appear regular on their face and relate to such
Subsequent Mortgage
Loan.
The Trustee agrees to execute and deliver within 30 days after
the
Subsequent Transfer Date to the Depositor, the Master Servicer and
CHL (on
behalf of each Seller) an Interim Certification substantially in
the form
annexed hereto as Exhibit G-2 to the effect that, as to each
Subsequent
Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Subsequent
Mortgage Loan paid in full or any Subsequent Mortgage Loan
specifically
identified in such certification as not covered by such
certification), all
documents required to be delivered to it pursuant to this Agreement
with
respect to such Subsequent Mortgage Loan are in its possession
(except those
described in Section 2.01(g)(vi)) and based on its review and
examination and
only as to the foregoing documents, (i) such documents appear
regular on their
face and relate to such Subsequent Mortgage Loan, and (ii) the
information set
forth in items (i), (iv), (v), (vi), (viii), (ix) and (xv) of the
definition
of the "Mortgage Loan Schedule" accurately reflects information set
forth in
the Mortgage File. On or before the thirtieth (30th) day after the
Subsequent
Transfer Date (or if such thirtieth day is not a Business Day, the
succeeding
Business Day), the Trustee shall deliver to the Depositor, the
Master Servicer
and CHL (on behalf of each Seller) a Delay Delivery Certification
with respect
to the Subsequent Mortgage Loans substantially in the form annexed
hereto as
Exhibit G-3, with any applicable exceptions noted thereon, together
with a
Subsequent Certification substantially in the form annexed hereto
as Exhibit
G-4. The Trustee shall be under no duty or obligation to inspect,
review or
examine such documents, instruments, certificates or other papers
to determine
that the same are genuine, enforceable or appropriate for the
represented
purpose or that they have actually been recorded in the real estate
records or
that they are other than what they purport to be on their face.
Not later than 180 days after the Subsequent Transfer Date, the
Trustee shall deliver to the Depositor, the Master Servicer, CHL
(on behalf of
each Seller) and to any Certificateholder that so requests a
Final
Certification with respect to the Subsequent Mortgage Loans
substantially in
the form annexed hereto as Exhibit H, with any applicable
exceptions noted
thereon.
In connection with the Trustee's completion and delivery of
such
Final Certification, the Co-Trustee shall review each Mortgage File
with
respect to the Subsequent Mortgage Loans to determine that such
Mortgage File
contains the following documents:
(i) the original Mortgage Note, endorsed by manual or facsimile
signature in blank in the following form: "Pay to the order of
________________ without recourse", with all intervening
endorsements that show a complete chain
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of endorsement from the originator to the Person endorsing the
Mortgage Note (each such endorsement being sufficient to
transfer
all right, title and interest of the party so endorsing, as
noteholder or assignee thereof, in and to that Mortgage Note),
or,
if the original Mortgage Note has been lost or destroyed and
not
replaced, an original lost note affidavit, stating that the
original
Mortgage Note was lost or destroyed, together with a copy of
the
related Mortgage Note and all such intervening endorsements;
(ii) in the case of each Subsequent Mortgage Loan that is not a
MERS Mortgage Loan, the original recorded Mortgage or a copy of
such
Mortgage, with recording information, and in the case of each
Subsequent Mortgage Loan that is a MERS Mortgage Loan, the
original
Mortgage or a copy of such Mortgage, with recording
information,
noting the presence of the MIN of the Subsequent Mortgage Loan
and
language indicating that the Subsequent Mortgage Loan is a MOM
Loan
if the Subsequent Mortgage Loan is a MOM Loan, with evidence of
recording indicated thereon, or a copy of the Mortgage certified
by
the public recording office in which Mortgage has been
recorded;
(iii) in the case of each Subsequent Mortgage Loan that is not
a MERS Mortgage Loan, a duly executed assignment of the Mortgage
or
a copy thereof with recording information, in either case in
the
form permitted by Section 2.01;
(iv) the original recorded assignment or assignments of the
Mortgage or a copy of such assignments, with recording
information,
together with all interim recorded assignments of such Mortgage or
a
copy of such assignments, with recording information (in each
case
noting the presence of a MIN in the case of each MERS Mortgage
Loan);
(v) the original or copies of each assumption, modification,
written assurance or substitution agreement, if any; and
(vi) the original or duplicate original lender's title policy
or a copy of lender's title policy or a printout of the
electronic
equivalent and all riders thereto.
If, in the course of such review, the Trustee finds any document
or
documents constituting a part of such Mortgage File that do not
meet the
requirements of clauses (i)-(iv) and (vi) above, the Trustee shall
include
such exceptions in such Final Certification (and the Trustee shall
state in
such Final Certification whether any Mortgage File does not then
include the
original or duplicate original lender's title policy or a printout
of the
electronic equivalent and all riders thereto). If the public
recording office
in which a Mortgage or assignment thereof is recorded retains the
original of
such Mortgage or assignment, a copy of the original Mortgage or
assignment so
retained, with evidence of recording thereon, certified to be true
and
complete by such recording office, shall be deemed to satisfy the
requirements
of clause (ii), (iii) or (iv) above, as applicable. CHL shall
promptly correct
or cure such defect referred to above within 90 days from the date
it was so
notified of such defect and, if CHL does not correct or cure such
defect
within such period, CHL shall either (A) if the time to cure such
defect
expires prior to the end of the second anniversary of the Closing
Date,
substitute for the related Subsequent
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Mortgage Loan a Replacement Mortgage Loan, which substitution shall
be
accomplished in the manner and subject to the conditions set forth
in Section
2.03, or (B) purchase such Subsequent Mortgage Loan from the Trust
Fund within
90 days from the date CHL was notified of such defect in writing at
the
Purchase Price of such Subsequent Mortgage Loan; provided that any
such
substitution pursuant to (A) above or repurchase pursuant to (B)
above shall
not be effected prior to the delivery to the Trustee of the Opinion
of Counsel
required by Section 2.05 hereof and any substitution pursuant to
(A) above
shall not be effected prior to the additional delivery to the
Trustee of a
Request for File Release. No substitution will be made in any
calendar month
after the Determination Date for such month. The Purchase Price for
any such
Subsequent Mortgage Loan shall be deposited by CHL in the
Certificate Account
and, upon receipt of such deposit and Request for File Release with
respect
thereto, the Trustee shall release the related Mortgage File to CHL
and shall
execute and deliver at CHL's request such instruments of transfer
or
assignment as CHL has prepared, in each case without recourse, as
shall be
necessary to vest in CHL, or a designee, the Trustee's interest in
any
Subsequent Mortgage Loan released pursuant hereto. If pursuant to
the
foregoing provisions CHL repurchases a Subsequent Mortgage Loan
that is a MERS
Mortgage Loan, the Master Servicer shall cause MERS to execute and
deliver an
assignment of the Mortgage in recordable form to transfer the
Mortgage from
MERS to CHL and shall cause such Mortgage to be removed from
registration on
the MERS(R) System in accordance with MERS' rules and
regulations.
The Co-Trustee shall retain possession and custody of each
Mortgage
File in accordance with and subject to the terms and conditions set
forth
herein. Each Seller shall promptly deliver to the Co-Trustee, upon
the
execution or receipt thereof, the originals of such other documents
or
instruments constituting the Mortgage File that come into the
possession of
such Seller from time to time.
It is understood and agreed that the obligation of the Sellers
to
substitute for or to purchase, pursuant to Section 2.02(b), any
Subsequent
Mortgage Loan whose Mortgage File contains any document or
documents that does
not meet the requirements of clauses (i)-(iv) and (vi) above and
which defect
is not corrected or cured by such Seller within 90 days from the
date it was
notified of such defect, shall constitute the sole remedy
respecting such
defect available to the Trustee, the Co-Trustee, the Depositor and
any
Certificateholder against the Sellers.
Section 2.03 Representations, Warranties and Covenants of the
Master
Servicer and the Sellers.
(a) The Master Servicer hereby represents and warrants to the
Depositor and the Trustee as follows, as of the date hereof with
respect to
the Initial Mortgage Loans, and the related Subsequent Transfer
Date with
respect to the Subsequent Mortgage Loans:
(1) The Master Servicer is duly organized as a Texas limited
partnership and is validly existing and in good standing under the
laws
of
the State of Texas and is duly authorized and qualified to
transact
any
and all business contemplated by this Agreement to be conducted
by
the
Master Servicer in any state in which a Mortgaged Property is
located
or
is otherwise not required under applicable law to effect such
qualification and, in any event, is in compliance with the doing
business
laws
of any such state, to the extent necessary to ensure its ability
to
enforce each Mortgage Loan, to
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<PAGE>
service the Mortgage Loans in accordance with the terms of this
Agreement
and
to perform any of its other obligations under this Agreement in
accordance with the terms hereof.
(2) The Master Servicer has the full partnership power and
authority to sell and service each Mortgage Loan, and to execute,
deliver
and perform, and to
enter into and consummate the transactions
contemplated by this Agreement and has duly authorized by all
necessary
partnership action on the part of the Master Servicer the
execution,
delivery and performance of this Agreement; and this Agreement,
assuming
the
due authorization, execution and delivery hereof by the other
parties
hereto, constitutes a legal, valid and binding obligation of the
Master
Servicer, enforceable against the Master Servicer in accordance
with its
terms, except that (a) the enforceability hereof may be limited
by
bankruptcy, insolvency, moratorium, receivership and other similar
laws
relating to creditors' rights generally and (b) the remedy of
specific
performance and injunctive and other forms of equitable relief may
be
subject to equitable defenses and to the discretion of the court
before
which any proceeding therefor may be brought.
(3) The execution and delivery of this Agreement by the Master
Servicer
