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 January 1, 2007
-------------------------------
ASSET-BACKED CERTIFICATES, SERIES 2007-1
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<TABLE>
<CAPTION>
Table of Contents
Page
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ARTICLE I.
DEFINITIONS
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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...................................................................56
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...............69
Section 2.04
Representations and Warranties of the
Depositor................................................89
Section 2.05 Delivery
of Opinion of Counsel in Connection with Substitutions and
Repurchases................91
Section 2.06
Authentication and Delivery of
Certificates....................................................91
Section 2.07 Covenants
of the Master
Servicer...............................................................92
ARTICLE III.
ADMINISTRATION
AND SERVICING OF MORTGAGE LOANS
Section 3.01 Master
Servicer to Service Mortgage
Loans......................................................92
Section 3.02
Subservicing; Enforcement of the Obligations of Master
Servicer................................94
Section 3.03 Rights of
the Depositor, the Sellers, the Certificateholders,
the NIM Insurer and the Trustee in Respect of the Master
Servicer..............................95
Section 3.04 Trustee to
Act as Master
Servicer..............................................................96
Section 3.05 Collection
of Mortgage Loan Payments; Certificate Account; Distribution
Account; Pre-Funding Account; Capitalized Interest
Account.....................................96
Section 3.06 Collection
of Taxes, Assessments and Similar Items; Escrow
Accounts...........................100
Section 3.07 Access to
Certain Documentation and Information Regarding the Mortgage
Loans..................100
Section 3.08 Permitted
Withdrawals from the Certificate Account, Distribution Account,
Carryover Reserve Fund and the Principal Reserve
Fund.........................................101
Section 3.09
[Reserved]....................................................................................104
Section 3.10
Maintenance of Hazard
Insurance...............................................................104
Section 3.11
Enforcement of Due-On-Sale Clauses; Assumption
Agreements.....................................105
Section 3.12
Realization Upon Defaulted Mortgage Loans; Determination of Excess
Proceeds
and Realized Losses; Repurchase of Certain Mortgage
Loans.....................................106
Section 3.13 Co-Trustee
to Cooperate; Release of Mortgage
Files............................................110
Section 3.14 Documents,
Records and Funds in Possession of Master Servicer to be Held for
the Trustee......111
Section 3.15 Servicing
Compensation........................................................................111
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Section 3.16 Access to
Certain
Documentation...............................................................112
Section 3.17 Annual
Statement as to
Compliance.............................................................112
Section 3.18
[Reserved]....................................................................................113
Section 3.19
[Reserved]....................................................................................113
Section 3.20 Prepayment
Charges............................................................................113
Section 3.21 Swap
Contract.................................................................................114
ARTICLE IV.
DISTRIBUTIONS AND ADVANCES BY THE MASTER SERVICER
Section 4.01 Advances;
Remittance
Reports..................................................................116
Section 4.02 Reduction
of Servicing Compensation in Connection with Prepayment Interest
Shortfalls.........117
Section 4.03
[Reserved]....................................................................................118
Section 4.04
Distributions.................................................................................118
Section 4.05 Monthly
Statements to
Certificateholders......................................................125
Section 4.06
Termination of a Mortgage Insurance
Policy....................................................126
Section 4.07 Carryover
Reserve
Fund........................................................................127
Section 4.08 Credit
Comeback Excess
Account................................................................127
Section 4.09 Swap Trust
and Swap
Account...................................................................128
Section 4.10 Final
Maturity Reserve Trust and Final Maturity Reserve
Fund..................................129
ARTICLE V.
THE CERTIFICATES
Section 5.01 The
Certificates..............................................................................131
Section 5.02
Certificate Register; Registration of Transfer and Exchange of
Certificates...................132
Section 5.03 Mutilated,
Destroyed, Lost or Stolen
Certificates.............................................137
Section 5.04 Persons
Deemed
Owners.........................................................................137
Section 5.05 Access to
List of Certificateholders' Names and
Addresses.....................................137
Section 5.06 Book-Entry
Certificates.......................................................................138
Section 5.07 Notices to
Depository.........................................................................139
Section 5.08 Definitive
Certificates.......................................................................139
Section 5.09
Maintenance of Office or
Agency...............................................................139
ARTICLE VI.
THE DEPOSITOR, THE MASTER SERVICER AND THE SELLERS
Section 6.01 Respective
Liabilities of the Depositor, the Master Servicer and the
Sellers..................140
Section 6.02 Merger or
Consolidation of the Depositor, the Master Servicer or the
Sellers..................140
Section 6.03 Limitation
on Liability of the Depositor, the Sellers, the Master
Servicer,
the NIM
Insurer and
Others....................................................................141
Section 6.04 Limitation
on Resignation of Master
Servicer..................................................141
Section 6.05 Errors and
Omissions Insurance; Fidelity
Bonds................................................142
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ARTICLE VII.
DEFAULT; TERMINATION OF MASTER SERVICER
Section 7.01 Events of
Default.............................................................................142
Section 7.02 Trustee to
Act; Appointment of
Successor......................................................144
Section 7.03
Notification to
Certificateholders............................................................146
ARTICLE VIII.
CONCERNING THE TRUSTEE AND THE CO-TRUSTEE
Section 8.01 Duties of
Trustee.............................................................................146
Section 8.02 Certain
Matters Affecting the
Trustee.........................................................148
Section 8.03 Trustee
Not Liable for Mortgage
Loans.........................................................149
Section 8.04 Trustee
May Own
Certificates..................................................................150
Section 8.05 Master
Servicer to Pay Trustee's Fees and
Expenses............................................150
Section 8.06
Eligibility Requirements for
Trustee..........................................................150
Section 8.07
Resignation and Removal of
Trustee............................................................151
Section 8.08 Successor
Trustee.............................................................................152
Section 8.09 Merger or
Consolidation of
Trustee............................................................152
Section 8.10
Appointment of Co-Trustee or Separate
Trustee.................................................153
Section 8.11 Tax
Matters...................................................................................154
Section 8.12
Co-Trustee....................................................................................157
Section 8.13 Access to
Records of the
Trustee..............................................................160
Section 8.14 Suits for
Enforcement.........................................................................160
ARTICLE IX.
TERMINATION
Section 9.01
Termination upon Liquidation or Repurchase of all Mortgage
Loans..............................161
Section 9.02 Final
Distribution on the
Certificates........................................................162
Section 9.03 Additional
Termination
Requirements...........................................................163
Section 9.04 Auction of
the Mortgage Loans and REO
Properties..............................................164
ARTICLE X.
MISCELLANEOUS PROVISIONS
Section 10.01
Amendment.....................................................................................168
Section 10.02 Recordation of
Agreement;
Counterparts........................................................170
Section 10.03 Governing
Law.................................................................................170
Section 10.04 Intention of
Parties..........................................................................170
Section 10.05
Notices.......................................................................................172
Section 10.06 Severability of
Provisions....................................................................173
Section 10.07
Assignment....................................................................................173
Section 10.08 Limitation on
Rights of
Certificateholders....................................................173
Section 10.09 Inspection and
Audit
Rights...................................................................174
Section 10.10 Certificates
Nonassessable and Fully
Paid.....................................................174
Section 10.11 Rights of NIM
Insurer.........................................................................174
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ARTICLE XI.
EXCHANGE ACT REPORTING
Section 11.01 Filing
Obligations............................................................................176
Section 11.02 Form 10-D
Filings.............................................................................176
Section 11.03 Form 8-K
Filings..............................................................................177
Section 11.04 Form 10-K
Filings.............................................................................177
Section 11.05 Sarbanes-Oxley
Certification..................................................................178
Section 11.06 Form 15
Filing................................................................................178
Section 11.07 Report on
Assessment of Compliance and
Attestation............................................179
Section 11.08 Use of
Subservicers and
Subcontractors........................................................180
Section 11.09
Amendments....................................................................................181
Section 11.10 Reconciliation
of
Accounts....................................................................181
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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
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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
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<PAGE>
POOLING AND SERVICING AGREEMENT, dated as of January 1, 2007, 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 and the Capitalized Interest 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 and the Capitalized Interest 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.
Swap-IO REMIC Interest Initial
Principal Balance(1) Pass-Through
Rate
----------------------
-------------------------
-----------------
SWR-1A
$ 5,819,766.50
(2)
SWR-1B
5,819,766.50
(3)
SWR-2A
6,930,175.50
(2)
SWR-2B
6,930,175.50
(3)
SWR-3A
8,074,492.00
(2)
SWR-3B
8,074,492.00
(3)
1
<PAGE>
Swap-IO REMIC Interest Initial
Principal Balance(1) Pass-Through
Rate
----------------------
-------------------------
-----------------
SWR-4A
8,107,763.50
(2)
SWR-4B
8,107,763.50
(3)
SWR-5A
8,842,307.00
(2)
SWR-5B
8,842,307.00
(3)
SWR-6A
9,983,827.50
(2)
SWR-6B
9,983,827.50
(3)
SWR-7A
10,905,208.00
(2)
SWR-7B
10,905,208.00
(3)
SWR-8A
11,962,837.00
(2)
SWR-8B
11,962,837.00
(3)
SWR-9A
12,993,534.50
(2)
SWR-9B
12,993,534.50
(3)
SWR-10A
13,993,138.50
(2)
SWR-10B
13,993,138.50
(3)
SWR-11A
14,820,175.50
(2)
SWR-11B
14,820,175.50
(3)
SWR-12A
107,623,141.50
(2)
SWR-12B
107,623,141.50
(3)
SWR-13A
15,193,695.50
(2)
SWR-13B
15,193,695.50
(3)
SWR-14A
15,230,024.50
(2)
SWR-14B
15,230,024.50
(3)
SWR-15A
15,036,485.50
(2)
SWR-15B
15,036,485.50
(3)
SWR-16A
15,405,620.50
(2)
SWR-16B
15,405,620.50
(3)
SWR-17A
15,746,522.00
(2)
SWR-17B
15,746,522.00
(3)
SWR-18A
24,694,745.00
(2)
SWR-18B
24,694,745.00
(3)
SWR-19A
15,825,910.00
(2)
SWR-19B
15,825,910.00
(3)
SWR-20A
15,509,748.50
(2)
SWR-20B
15,509,748.50
(3)
SWR-21A
15,199,322.00
(2)
SWR-21B
15,199,322.00
(3)
SWR-22A
14,273,665.50
(2)
SWR-22B
14,273,665.50
(3)
SWR-23A
13,674,998.00
(2)
SWR-23B
13,674,998.00
(3)
SWR-24A
116,812,970.00
(2)
SWR-24B
116,812,970.00
(3)
SWR-25A
11,321,896.50
(2)
SWR-25B
11,321,896.50
(3)
SWR-26A
11,048,619.50
(2)
2
<PAGE>
Swap-IO REMIC Interest Initial
Principal Balance(1) Pass-Through
Rate
----------------------
-------------------------
-----------------
SWR-26B
11,048,619.50
(3)
SWR-27A
10,783,900.00
(2)
SWR-27B
10,783,900.00
(3)
SWR-28A
9,686,636.00
(2)
SWR-28B
9,686,636.00
(3)
SWR-29A
9,435,285.00
(2)
SWR-29B
9,435,285.00
(3)
SWR-30A
24,806,186.00
(2)
SWR-30B
24,806,186.00
(3)
SWR-31A
9,585,931.00
(2)
SWR-31B
9,585,931.00
(3)
SWR-32A
9,360,067.00
(2)
SWR-32B
9,360,067.00
(3)
SWR-33A
9,144,838.50
(2)
SWR-33B
9,144,838.50
(3)
SWR-34A
8,930,989.00
(2)
SWR-34B
8,930,989.00
(3)
SWR-35A
8,725,933.50
(2)
SWR-35B
8,725,933.50
(3)
SWR-36A
191,142,663.50
(2)
SWR-36B
191,142,663.50
(3)
SWR-37A
2,053,645.50
(2)
SWR-37B
2,053,645.50
(3)
SWR-38A
2,356,130.50
(2)
SWR-38B
2,356,130.50
(3)
SWR-39A
2,187,692.00
(2)
SWR-39B
2,187,692.00
(3)
SWR-40A
2,127,788.00
(2)
SWR-40B
2,127,788.00
(3)
SWR-41A
1,990,533.00
(2)
SWR-41B
1,990,533.00
(3)
SWR-42A
2,006,697.50
(2)
SWR-42B
2,006,697.50
(3)
SWR-43A
1,935,561.50
(2)
SWR-43B
1,935,561.50
(3)
SWR-44A
1,785,926.00
(2)
SWR-44B
1,785,926.00
(3)
SWR-45A
1,890,724.00
(2)
SWR-45B
1,890,724.00
(3)
SWR-46A
1,744,958.00
(2)
SWR-46B
1,744,958.00
(3)
SWR-47A
1,892,141.50
(2)
SWR-47B
1,892,141.50
(3)
SWR-48A
1,535,565.50
(2)
SWR-48B
1,535,565.50
(3)
3
<PAGE>
Swap-IO REMIC Interest Initial
Principal Balance(1) Pass-Through
Rate
----------------------
-------------------------
-----------------
SWR-49A
1,504,328.00
(2)
SWR-49B
1,504,328.00
(3)
SWR-50A
1,770,192.00
(2)
SWR-50B
1,770,192.00
(3)
SWR-51A
1,689,507.00
(2)
SWR-51B
1,689,507.00
(3)
SWR-52A
1,685,864.50
(2)
SWR-52B
1,685,864.50
(3)
SWR-53A
1,608,694.00
(2)
SWR-53B
1,608,694.00
(3)
SWR-54A
1,604,433.00
(2)
SWR-54B
1,604,433.00
(3)
SWR-55A
1,523,184.00
(2)
SWR-55B
1,523,184.00
(3)
SWR-56A
1,380,721.00
(2)
SWR-56B
1,380,721.00
(3)
SWR-57A
1,435,406.50
(2)
SWR-57B
1,435,406.50
(3)
SWR-58A
1,303,726.50
(2)
SWR-58B
1,303,726.50
(3)
SWR-59A
1,518,569.00
(2)
SWR-59B
1,518,569.00
(3)
SWR-60A
1,820,174.50
(2)
SWR-60B
1,820,174.50
(3)
SWR-61A
1,648,581.00
(2)
SWR-61B
1,648,581.00
(3)
SWR-62A
1,810,594.50
(2)
SWR-62B
1,810,594.50
(3)
SWR-63A
1,607,042.50
(2)
SWR-63B
1,607,042.50
(3)
SWR-64A
1,488,766.00
(2)
SWR-64B
1,488,766.00
(3)
SWR-65A
1,581,014.50
(2)
SWR-65B
1,581,014.50
(3)
SWR-66A
1,503,549.00
(2)
SWR-66B
1,503,549.00
(3)
SWR-67A
1,371,558.00
(2)
SWR-67B
1,371,558.00
(3)
SWR-68A
1,267,553.50
(2)
SWR-68B
1,267,553.50
(3)
SWR-69A
1,340,514.50
(2)
SWR-69B
1,340,514.50
(3)
SWR-70A
1,239,027.00
(2)
SWR-70B
1,239,027.00
(3)
SWR-71A
1,338,921.00
(2)
4
<PAGE>
Swap-IO REMIC Interest Initial
Principal Balance(1) Pass-Through
Rate
----------------------
-------------------------
-----------------
SWR-71B
1,338,921.00
(3)
SWR-72A
97,317,696.00
(2)
SWR-72B
97,317,696.00
(3)
SWR-Support
(4)
(5)
SWR-P
$
100.00
(6)
SWR-40 Year
Reserve
(7)
(7)
SW-A-R
(8)
(8)
----------
(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 between the "A" and "B" components
of
such
numbered class pro-rata until the entire class is reduced to
zero.
(2) Prior to the
73rd Distribution Date, a rate equal to twice the Pool Tax
Cap less
10.56% per annum. On and after the 73rd 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 February 2017 and ending
on
the
Distribution Date in January 2037 (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
73rd Distribution Date, a rate equal to the lesser of (i)
10.56% per
annum and (ii) twice the Pool Tax Cap. On and after the 73rd
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 February 2017 and ending on 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").
5
<PAGE>
(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:
(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>
------------------------------- ----------------------------
---------------------------- ----------------------------
Pass-Through
Corresponding Class of
Strip REMIC Interest
Initial Principal Balance
Rate
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
6
<PAGE>
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, 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.......................................
$540,940,000.00
(1)
Class 2-A-1.....................................
$455,775,000.00
(1)
Class 2-A-2.....................................
$145,076,000.00
(1)
Class 2-A-3.....................................
$320,823,000.00
(1)
Class 2-A-4.....................................
$128,386,000.00
(1)
Class M-1.......................................
$76,000,000.00
(1)
Class M-2.......................................
$69,000,000.00
(1)
Class M-3.......................................
$40,000,000.00
(1)
Class M-4.......................................
$38,000,000.00
(1)
Class M-5.......................................
$35,000,000.00
(1)
Class M-6.......................................
$31,000,000.00
(1)
Class M-7.......................................
$26,000,000.00
(1)
Class M-8.......................................
$15,000,000.00
(1)
Class M-9.......................................
$21,000,000.00
(1)
Class B.........................................
$23,000,000.00
(1)
Class C.........................................
(2)
(3)
Class P.........................................
$100.00
(4)
Class A-R.......................................
$100.00
(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 Interest 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
8
<PAGE>
from 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 Capitalized Interest 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 Mortgage Rate: As to each Mortgage Loan, the Mortgage
Rate
less the related Servicing Fee Rate.
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.
10
<PAGE>
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.
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
11
<PAGE>
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.
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, and
Class B
Certificates having an initial Certificate Principal Balance of
$3,000,000
constitute 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.
Capitalized Interest Account: The separate Eligible Account
designated
as such and created and maintained by the Trustee pursuant to
Section 3.05(e).
The Capitalized Interest Account shall be treated as an "outside
reserve fund"
under applicable Treasury regulations and shall not be part of any
REMIC. Except
as provided in Section 3.05(e), any investment earnings on the
amounts on
deposit in the Capitalized Interest Account shall be treated as
owned by the
Depositor and shall be taxable to the Depositor.
Capitalized Interest Deposit: $7,342,186.89.
Capitalized Interest Release Amount: With respect to any
Subsequent
Transfer Date, an amount equal to the product of (1) the sum of (a)
the Trustee
Fee Rate and (b) the weighted average Adjusted Net Mortgage Rate of
the Mortgage
Loans (excluding any Subsequent Mortgage Loans conveyed to the
Trust Fund during
the calendar month in which such Subsequent Transfer Date occurs)
as of the
first day of the Due Period beginning in the month in which such
Subsequent
Transfer Date occurs (after giving effect to Principal Prepayments
received
during the Prepayment Period, if any, that ends during such Due
Period), (2) the
Subsequent Transfer Date Transfer Amount for such Subsequent
Transfer Date and
(3) a fraction, the numerator of which is the number of calendar
months in the
period beginning with the calendar month in which such Subsequent
Transfer Date
occurs and ending with the calendar month containing the latest
date on which
the Funding Period could end, and the denominator of which is
12.
12
<PAGE>
Capitalized Interest Requirement: With respect to each Funding
Period
Distribution Date, 1/12 of the product of (1) the sum of (a) the
Trustee Fee
Rate and (b) the weighted average Adjusted Net Mortgage Rate of the
Mortgage
Loans (excluding any Subsequent Mortgage Loans conveyed to the
Trust Fund during
the calendar month preceding such Distribution Date) as of the
first day of the
related Due Period (after giving effect to Principal Prepayments
received during
the Prepayment Period, if any, that ends during such Due Period)
and (2) the
amount on deposit in the Pre-Funding Account as of the last day of
the calendar
month preceding such Funding Period Distribution Date (or, if the
Funding Period
ended during such calendar month, as of the last day of the Funding
Period).
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 2007-1". 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 2007-1". 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
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.
13
<PAGE>
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 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
14
<PAGE>
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 Certificates: The Class 2-A-1, Class 2-A-2, Class 2-A-3
and
Class 2-A-4 Certificates collectively.
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
(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
15
<PAGE>
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) 59.10% 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.
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.
16
<PAGE>
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: February 9, 2007.
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) 77.60% 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 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.
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<PAGE>
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest: With respect to each Loan Group and any
Distribution Date, an amount equal to the lesser of (x) one-half of
the
Servicing Fee for the Mortgage Loans in that Loan Group 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, Global No. N563177N, with a trade
date
of January 26, 2007 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, Floor
4W, 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 2007-1". 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 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
18
<PAGE>
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:
Distribution Date
Percentage
-----------------
----------
February 2009 -- January 2010
1.25% with respect to February 2009, plus
an additional 1/12th of 1.55% for each
month thereafter through January 2010
February 2010 -- January 2011......... 2.80% with respect to
February 2010, plus
an additional 1/12th of 1.65% for each
month thereafter through January 2011
February 2011 -- January 2012......... 4.45% with respect to
February 2011, plus
an additional 1/12th of 1.30% for each
month thereafter through January 2012
February 2012 -- January 2013......... 5.75% with respect to
February 2012, plus
an additional 1/12th of 0.75% for each
month thereafter through January 2013
February 2013 and thereafter.......... 6.50%
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.
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<PAGE>
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 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.
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<PAGE>
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.....................
39.10%
M-1...................
48.02%
M-2...................
60.58%
M-3...................
71.39%
M-4...................
85.98%
M-5...................
105.91%
M-6...................
133.27%
M-7...................
170.13%
M-8...................
202.43%
M-9...................
275.72%
B.....................
456.91%
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.
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).
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<PAGE>
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 2007-1". 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
February 2007.
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 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.
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<PAGE>
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.
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.
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<PAGE>
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 February 2017, 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)
$43,410,348.
Final Maturity OC Trigger: With respect to any Distribution Date on
or
after the Distribution Date in February 2027, 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 (including
any Final
Maturity Reserve Deposit made on the Distribution Date) and (y)
the
Overcollateralized Amount for that Distribution Date (calculated
after giving
effect to all distributions to be made prior to the time of
determination) is
less than the outstanding Stated Principal Balance of all 40-Year
Mortgage Loans
as of the Due Date occurring in the month of that Distribution Date
(after
giving effect to Principal Prepayments received during the
Prepayment Period
ending in the same month as the Distribution Date).
Final Maturity Required Deposit Trigger: With respect to any
Distribution Date on or after the Distribution Date in February
2017 up to and
including the Distribution Date in January 2037, 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 on which
the
Final Maturity Required Deposit Trigger is not in effect, $0. For
any
Distribution Date on which the Final Maturity Required Deposit
Trigger is in
effect, 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.
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<PAGE>
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 2007-1". Funds in the Final Maturity Reserve
Fund shall be
held in trust by the Final Maturity Reserve Trustee 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.
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) March 31, 2007.
Funding Period Distribution Date: Each Distribution Date on or
prior to
the Distribution Date occurring in the calendar month following the
month in
which the Funding Period ends.
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<PAGE>
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 $135,001,648.12.
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 $273,085,525.47.
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 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.
26
<PAGE>
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) January 1, 2007 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 respect to prior Distribution
Dates over
(ii) the amount actually distributed to such Class with respect to
interest on
such prior Distribution Dates.
27
<PAGE>
Interest Determination Date: With respect to the first Accrual
Period
for the Interest-Bearing Certificates, February 7, 2007. 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),
(vi) Seller Interest Shortfall Payments with respect to such
Mortgage Loans for
such Distribution Date, and (vii) in the case of each Funding
Period
Distribution Date, the portion of the Capitalized Interest
Requirement for such
Distribution Date allocable to such Loan Group, if any, 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).
ISDA Master Agreement: The 1992 ISDA Master Agreement
(Multicurrency -
Cross Border), including the Schedule and Credit Support Annex
thereto, dated
February 9, 2007, between the Swap Counterparty and the Swap
Contract
Administrator.
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)).
28
<PAGE>
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, 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-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 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.
29
<PAGE>
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 or the
Mortgage Insurance
Policy issued by Mortgage Guaranty Insurance Corporation 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
or the premium payable on the Mortgage Insurance Policy issued by
Mortgage
Guaranty Insurance Corporation, each on each Distribution Date and
amounts due
for premium taxes with respect to West Virginia, Kentucky or other
applicable
state taxes relating to such premium.
Mortgage Insurance Premium Rate: With respect to a Covered
Mortgage
Loan, the per annum rate set forth for such Covered Mortgage Loan
on the
Mortgage Loan Schedule.
30
<PAGE>
Mortgage Insurer:
Either of United Guaranty Mortgage Indemnity Company
or Mortgage Guaranty Insurance Corporation 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 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;
31
<PAGE>
(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 and the applicable Mortgage Insurance Premium Rate as
set forth in the applicable Mortgage Insurance Policy; 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 supplement thereto
delivered
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.
32
<PAGE>
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.
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
33
<PAGE>
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 5.32000% 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
34
<PAGE>
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.
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
35
<PAGE>
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:
36
<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..................... 0.100%
0.200%
-------------------------------- ---------------
-----------------
Class 2-A-3..................... 0.140%
0.280%
-------------------------------- ---------------
-----------------
Class 2-A-4..................... 0.230%
0.460%
-------------------------------- ---------------
-----------------
Class M-1....................... 0.230%
0.345%
-------------------------------- ---------------
-----------------
Class M-2....................... 0.270%
0.405%
-------------------------------- ---------------
-----------------
Class M-3....................... 0.300%
0.450%
-------------------------------- ---------------
-----------------
Class M-4....................... 0.370%
0.555%
-------------------------------- ---------------
-----------------
Class
M-5....................... 0.380%
0.570%
-------------------------------- ---------------
-----------------
Class M-6....................... 0.450%
0.675%
-------------------------------- ---------------
-----------------
Class M-7....................... 0.900%
1.350%
-------------------------------- ---------------
-----------------
Class M-8....................... 1.700%
2.550%
-------------------------------- ---------------
-----------------
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
37
<PAGE>
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
38
<PAGE>
(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
39
<PAGE>
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 $408,087,173.59.
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 2007-1." 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.
40
<PAGE>
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
41
<PAGE>
month in which such Distribution Date occurs (or, with respect to
the first
Distribution Date, the period beginning with the opening of
business on January
2, 2007) 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 2007-1". Funds in the Principal Reserve
Fund
42
<PAGE>
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 February
8,
2007, 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 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 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 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.
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
43
<PAGE>
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.
Regular Certificate: Any Certificate other than the Class A-R
Certificates.
44
<PAGE>
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, 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
45
<PAGE>
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
(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.
46
<PAGE>
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.
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
47
<PAGE>
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.
Seller Interest Shortfall Payment: With respect to any Initial
Mortgage
Loan that does not have a first payment date on or before the Due
Date in the
month of the first Distribution Date or any Subsequent Mortgage
Loan that does
not have a first payment date on or before the Due Date in the
month immediately
following the related Subsequent Transfer Date, an amount equal to
one month's
interest at the related Adjusted Mortgage Rate on the Cut-off Date
Principal
Balance of that Mortgage Loan.
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.
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 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
48
<PAGE>
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, 0.50%
per
annum.
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 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 February 2010 and (y) the
first
Distribution Date on which the aggregate Certificate Principal
Balance of the
Senior
49
<PAGE>
Certificates (after calculating anticipated distributions on such
Distribution
Date) is less than or equal to 59.10% 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.......................
18.60%
Class M-5.......................
15.10%
Class M-6.......................
12.00%
Class M-7.......................
9.40%
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.
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
50
<PAGE>
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.
Subsequent Mortgage Loan: Any Mortgage Loan conveyed to the Trustee
on
a Subsequent Transfer Date, and listed on the related supplement to
the 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.
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<PAGE>
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 supplement to the 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 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.
52
<PAGE>
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 January
2013.
Swap Counterparty: Deutsche Bank AG, New York Branch and its
successors.
Swap Counterparty Trigger Event: Either (i) an "Event of Default"
under
the ISDA Master Agreement with respect to which the Swap
Counterparty is the
sole "Defaulting Party" (as defined in the ISDA Master Agreement)
or (ii) a
"Termination Event" (other than an Illegality or a Tax Event (as
such terms are
defined in the ISDA Master Agreement)) or "Additional Termination
Event" under
the ISDA Master Agreement with respect to which the Swap
Counterparty is the
sole "Affected Party" (as defined in the ISDA Master
Agreement).
Swap-IO REMIC: As defined in the Preliminary Statement.
Swap Termination Payment: The payment payable to either party under
the
ISDA Master Agreement due to an early termination of the ISDA
Master Agreement.
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 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.
53
<PAGE>
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, the Capitalized Interest 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.
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.
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<PAGE>
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 and Greenwich
Capital
Markets, 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.
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
55
<PAGE>
"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 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
56
<PAGE>
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 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;
57
<PAGE>
(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.........................
8.097%
0.10%
Weighted Average Original Loan-to-Value Ratio..........
79.47%
3.00%
Weighted Average Credit Bureau Risk Score..............
596 points
5 points
Percentage Originated under CHL's Full Documentation
Program................................................
62.23%
3.00%
Weighted Average Gross Margin of Adjustable Rate
Mortgage Loans.........................................
6.527%
0.10%
Loan Group 2
Characteristic
Value
Permitted Variance
--------------
-----
------------------
Weighted Average Mortgage Rate.........................
8.032%
0.10%
Weighted Average Original Loan-to-Value Ratio..........
81.54%
3.00%
Weighted Average Credit Bureau Risk Score..............
618 points
5 points
Percentage Originated under CHL's Full Documentation
Program................................................
55.40%
3.00%
Weighted Average Gross Margin of Adjustable Rate
Mortgage Loans.........................................
6.645%
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
58
<PAGE>
(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 supplement to the 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) (which
such Officer's Certificate shall set forth the Subsequent Transfer
Date Transfer
Amount and Capitalized Interest Release Amount, if any, for such
Subsequent
Transfer Date), the Trustee shall remit to CHL (on behalf of CHL
and the other
Sellers) the Subsequent Transfer Date Transfer Amount from such
funds that were
set aside in the Pre-Funding Account pursuant to Section 2.01(d)
and shall
distribute any Capitalized Interest Release Amount for such
Subsequent Transfer
Date to the order of CHL. 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.
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):
59
<PAGE>
(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 2007-1, CWABS, Inc., by The Bank
of
New York, a New York banking corporation, as trustee under the
Pooling
and Servicing Agreement dated as of January 1, 2007, 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);
(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
60
<PAGE>
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 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
61
<PAGE>
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.
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.
62
<PAGE>
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).
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
63
<PAGE>
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.
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
64
<PAGE>
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 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
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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.
(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
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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 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;
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(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
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
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<PAGE>
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 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, the servicing of the Mortgage Loans by the Master
Servicer
under this Agreement, the consummation of any other of the
transactions
contemplated by this Agreement, and the fulfillment of or
compliance
with the terms hereof are in the ordinary
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<PAGE>
course of business of the Master Servicer and will not (A) result
in a
material breach of any term or provision of the certificate of
limited
partnership, partnership agreement or other organizational document
of
the Master Servicer or (B) materially conflict with, result in
a
material breach, violation or acceleration of, or result in a
material
default under, the terms of any other material agreement or
instrument
to which the Master Servicer is a party or by which it may be
bound, or
(C) constitute a material violation of any statute, order or
regulation
applicable to the Master Servicer of any court, regulatory
body,
administrative agency or governmental body having jurisdiction over
the
Master Servicer; and the Master Servicer is not in breach or
violation
of any material indenture or other material agreement or
instrument, or
in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body
having
jurisdiction over it which breach or violation may materially
impair
the Master Servicer's ability to perform or meet any of its
obligations
under this Agreement.
(4) The Master Servicer is an approved servicer of
conventional mortgage loans for Fannie Mae and Freddie Mac and is
a
mortgagee approved by the Secretary of Housing and Urban
Development
pursuant to sections 203 and 211 of the National Housing Act.
(5) No litigation is pending or, to the best of the Master
Servicer's knowledge, threatened, against the Master Servicer
that
would materially and adversely affect the execution, delivery
or
enforceability of this Agreement or the ability of the Master
Servicer
to service the Mortgage Loans or to perform any of its other
obligations under this Agreement or any Subsequent Transfer
Agreement
in accordance with the terms hereof or thereof.
(6) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution,
delivery
and performance by the Master Servicer of, or compliance by the
Master
Servicer with, this Agreement or the consummation of the
transactions
contemplated hereby, or if any such consent, approval,
authorization or
order is required, the Master Servicer has obtained the same.
(7) The Master Servicer is a member of MERS in good standing,
and will comply in all material respects with the rules and
procedures
of MERS in connection with the servicing of the Mortgage Loans for
as
long as such Mortgage Loans are registered with MERS.
(8) The Master Servicer has fully furnished and will fully
furnish, in accordance with the Fair Credit Reporting Act and
its
implementing regulations, accurate and complete information
(i.e.,
favorable and unfavorable) on its borrower credit files to
Equifax,
Experian, and Trans Union Credit Information Company (three of
the
credit repositories), on a monthly basis for the Mortgage Loans in
Loan
Group 1.
(b) CHL hereby represents and warrants to the Depositor and the
Trustee
as follows, as of the Initial Cut-off Date in the case of the
Initial Mortgage
Loans and as of the related Subsequent Cut-off Date in the case of
the
Subsequent Mortgage Loans (unless otherwise indicated or the
context otherwise
requires, percentages with respect to the Initial Mortgage
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<PAGE>
Loans in the Trust Fund or in a Loan Group or Loan Groups are
measured by the
Cut-off Date Principal Balance of the Initial Mortgage Loans in the
Trust Fund
or of the Initial Mortgage Loans in the related Loan Group or Loan
Groups, as
applicable):
(1) CHL is duly
organized as a New York corporation and is
validly existing and in good standing under the laws of the State
of
New York and is duly authorized and qualified to transact any and
all
business contemplated by this Agreement and each Subsequent
Transfer
Agreement to be conducted by CHL 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 sell the
CHL
Mortgage Loans in accordance with the terms of this Agreement and
each
Subsequent
Transfer Agreement and to perform any of its other
obligations under this Agreement and each Subsequent Transfer
Agreement
in accordance with the terms hereof and thereof.
(2) CHL has the full corporate power and authority to sell
each CHL Mortgage Loan, and to execute, deliver and perform, and
to
enter into and consummate the transactions contemplated by this
Agreement and each Subsequent Transfer Agreement and has duly
authorized by
all necessary corporate action on the part of CHL the
execution, delivery and performance of this Agreement and each
Subsequent Transfer Agreement; and this Agreement and each
Subsequent
Transfer Agreement, assuming the due authorization, execution
and
delivery hereof by the other parties hereto, constitutes a legal,
valid
and binding obligation of CHL, enforceable against CHL 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 and each
Subsequent Transfer Agreement by CHL, the sale of the CHL
Mortgage
Loans by CHL under this Agreement and each Subsequent Transfer
Agreement, the consummation of any other of the transactions
contemplated by this Agreement and each Subsequent Transfer
Agreement,
and the fulfillment of or compliance with the terms hereof and
thereof
are in the ordinary course of business of CHL and will not (A)
result
in a material breach of any term or provision of the charter or
by-laws
of
CHL or (B) materially conflict with, result in a material
breach,
violation or acceleration of, or result in a material default
under,
the terms of any other material agreement or instrument to which
CHL is
a party or by which it may be bound, or (C) constitute a
material
violation of any statute, order or regulation applicable to CHL of
any
court, regulatory body, administrative agency or governmental
body
having jurisdiction over CHL; and CHL is not in breach or violation
of
any material indenture or other material agreement or instrument,
or in
violation of any statute, order or regulation of any court,
regulatory
body, administrative agency or governmental body having
jurisdiction
over it which breach or violation may materially impair CHL's
ability
to perform or meet any of its obligations under this Agreement and
each
Subsequent Transfer Agreement.
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<PAGE>
(4) CHL is an approved seller of conventional mortgage loans
for Fannie Mae and Freddie Mac and is a mortgagee approved by
the
Secretary of Housing and Urban Development pursuant to sections 203
and
211 of the National Housing Act.
(5) No litigation is pending or, to the best of CHL's
knowledge, threatened, against CHL that would materially and
adversely
affect the execution, delivery or enforceability of this Agreement
or
any Subsequent Transfer Agreement or the ability of CHL to sell the
CHL
Mortgage Loans or to perform any of its other obligations under
this
Agreement or any Subsequent Transfer Agreement in accordance with
the
terms hereof or thereof.
(6) No consent, approval, authorization or order of any court
or governmental agency or body is required for the execution,
delivery
and performance by CHL of, or compliance by CHL with, this
Agreement or
any Subsequent Transfer Agreement or the consummation of the
transactions contemplated hereby, or if any such consent,
approval,
authorization or order is required, CHL has obtained the same.
(7) The information set forth on Exhibit F-1 hereto with
respect to each Initial Mortgage Loan is true and correct in
all
material respects as of the Closing Date.
(8) CHL will treat the transfer of the CHL Mortgage Loans to
the
Depositor as a sale of the CHL Mortgage Loans for all tax,
accounting and regulatory purposes.
(9) None of the Mortgage Loans is 30 days or more delinquent.
(10) No Mortgage Loan had a Loan-to-Value Ratio at origination
in excess of 100.00%.
(11) Each Mortgage Loan is secured by a valid and enforceable
first lien on the related Mortgaged Property subject only to (1)
the
lien of non-delinquent current real property taxes and assessments,
(2)
covenants, conditions and restrictions, rights of way, easements
and
other matters of public record as of the date of recording of
such
Mortgage, such exceptions appearing of record being acceptable
to
mortgage lending institutions generally or specifically reflected
in
the appraisal made in connection with the origination of the
related
Mortgage Loan and (3)other matters to which like properties are
commonly subject that do not materially interfere with the benefits
of
the security intended to be provided by such Mortgage.
(12) Immediately prior to the assignment of each CHL Mortgage
Loan to the Depositor, CHL had good title to, and was the sole
owner
of, such CHL Mortgage Loan free and clear of any pledge, lien,
encumbrance or security interest and had full right and
authority,
subject to no interest or participation of, or agreement with,
any
other
party, to sell and assign the same pursuant to this Agreement.
(13) There is no delinquent tax or assessment lien against any
Mortgaged Property.
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<PAGE>
(14) There is no valid offset, claim, defense or counterclaim
to any Mortgage Note or Mortgage, including the obligation of
the
Mortgagor to pay the unpaid principal of or interest on such
Mortgage
Note.
(15) There are no mechanics' liens or claims for work, labor
or material affecting any Mortgaged Property that are or may be a
lien
prior to, or equal with, the lien of such Mortgage, except those
that
are insured against by the title insurance policy referred to in
item
(18) below.
(16) As of the Closing Date in the case of the Initial
Mortgage Loans and as of the related Subsequent Transfer Date in
the
case of the Subsequent Mortgage Loans, to the best of CHL's
knowledge,
each Mortgaged Property is free of material damage and is in
good
repair.
(17) As of the Closing Date in the case of the Initial
Mortgage Loans and as of the related Subsequent Transfer Date in
the
case of the Subsequent Mortgage Loans, neither CHL nor any prior
holder
of any Mortgage has modified the Mortgage in any material
respect
(except that a Mortgage Loan may have been modified by a
written
instrument
that has been recorded or submitted for recordation, if
necessary, to protect the interests of the Certificateholders and
the
original or a copy of which has been delivered to the Trustee);
satisfied, cancelled or subordinated such Mortgage in whole or in
part;
released the related Mortgaged Property in whole or in part from
the
lien of such Mortgage; or executed any instrument of release,
cancellation, modification (except as expressly permitted above)
or
satisfaction with respect thereto.
