SCHEDULE to the Master Agreement dated as of March 30, 2007 between DEUTSCHE BANK AG, NEW YORK BRANCH (“Party A”), and THE BANK OF NEW YORK, not in its individual or corporate capacity but solely as Swap Contract Administrator and Corridor Contract...
EXHIBIT
99.4
(Multicurrency-Cross
Border)
SCHEDULE
to
the
dated
as
of March 30, 2007
between
DEUTSCHE
BANK AG, NEW YORK BRANCH (“Party A”),
and
THE
BANK OF NEW YORK, not in its individual or corporate capacity but solely
as Swap
Contract Administrator and Corridor Contract Administrator for CWABS
Asset-Backed Certificates Trust 2007-5 (“Party B”)
All
terms used herein and not otherwise defined are given their meaning in the
Pooling and Servicing Agreement for CWABS Asset-Backed Certificates Trust
2007-5, dated as of March 1, 2007 among CWABS, Inc., as depositor, Park Monaco
Inc., as a seller, Park Sienna LLC, as a seller, Countrywide Home Loans,
Inc.,
as a seller, Countrywide Home Loans Servicing LP, as master servicer, The
Bank
of New York, as trustee, and The Bank of New York Trust Company, N.A., as
co-trustee (the “Pooling and Servicing Agreement”).
Part
1: Termination Provisions
For
the
purposes of this Agreement:-
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(a)
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“Specified
Entity” will not apply to Party A or Party B for any
purpose.
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(b)
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“Specified
Transaction” will not apply to Party A or Party B for any
purpose.
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(c)
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Events
of Default.
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The
statement below that an Event of Default will apply to a specific party means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will not
apply to a specific party means that the other party shall not have such
rights.
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(i)
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The
“Failure to Pay or Deliver” provisions of Section 5(a)(i)
will apply to Party A and will apply to Party B; provided, however,
that Section 5(a)(i) is hereby amended by replacing the word
“third” with the word “first”; provided, further, that notwithstanding
anything to the contrary in Section 5(a)(i), any failure by Party
A to
comply with or perform any obligation to be complied with or performed
by
Party A under the Credit Support Annex shall not constitute an
Event of
Default under Section 5(a)(i) unless (A) a Required Ratings Downgrade
Event has occurred and been continuing for 30 or more Local Business
Days
and (B) such failure is not remedied on or before the third Local
Business
Day after notice of such failure is given to Party
A.
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(ii)
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The
“Breach of Agreement” provisions of Section 5(a)(ii) will
apply to Party A and will not apply to Party
B.
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(iii)
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The
“Credit Support Default” provisions of Section 5(a)(iii)
will apply to Party A and will not apply to Party B except that
Section
5(a)(iii)(1) will apply to Party B solely in respect of Party B’s
obligations under Paragraph 3(b) of the Credit Support Annex; provided,
however, that notwithstanding anything to the contrary in Section
5(a)(iii)(1), any failure by Party A to comply with or perform
any
obligation to be complied with or performed by Party A under the
Credit
Support Annex shall not constitute an Event of Default under Section
5(a)(iii) unless (A) a Required Ratings Downgrade Event has occurred
and
been continuing for 30 or more Local Business Days and (B) such
failure is
not remedied on or before the third Local Business Day after notice
of
such failure is given to Party
A.
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(iv)
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The
“Misrepresentation” provisions of Section 5(a)(iv) will
apply to Party A and will not apply to Party
B.
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(v)
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The
“Default under Specified Transaction” provisions of
Section 5(a)(v) will not apply to Party A and will not apply to
Party
B.
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(vi)
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The
“Cross Default” provisions of Section 5(a)(vi) will apply
to Party A and will not apply to Party B. For purposes of
Section 5(a)(vi), solely with respect to Party
A:
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Section
5(a)(vi) is hereby amended by adding the following words at the end
thereof:
“provided,
however, that, notwithstanding the foregoing, an Event of Default shall not
occur under either (1) or (2) above if (A) (I) the default, or other similar
event or condition referred to in (1) or the failure to pay referred to in
(2)
is a failure to pay or deliver caused by an error or omission of an
administrative or operational nature, and (II) funds or the asset to be
delivered were available to such party to enable it to make the relevant
payment
or delivery when due and (III) such payment or delivery is made within three
(3)
Local Business Days following receipt of written notice from an interested
party
of such failure to pay, or (B) such party was precluded from paying, or was
unable to pay, using reasonable means, through the office of the party through
which it was acting for purposes of the relevant Specified Indebtedness,
by
reason of force majeure, act of State, illegality or
impossibility.”
“Specified
Indebtedness” will have the meaning specified in Section 14, except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A or, if applicable, the Eligible
Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, the sum (as shown in the
most recent annual audited financial statements of such entity) of (i) its
capital stock (including preferred stock) outstanding, taken at par value,
(ii)
its capital surplus and (iii) its retained earnings, minus (iv) treasury
stock,
each to be determined in accordance with generally accepted accounting
principles in the country in which Party A is organized.
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(vii)
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The
“Bankruptcy” provisions of Section 5(a)(vii) will apply
to Party A and will apply to Party B except that the provisions
of Section
5(a)(vii)(2), (6) (to the extent that such provisions refer to
any
appointment contemplated or effected by the Pooling and Servicing
Agreement or any appointment to which Party B has not become subject),
(7)
and (9) will not apply to Party B; provided that, with respect
to Party B
only, (i) Section 5(a)(vii)(4) is hereby amended by adding after
the words
“against it” the words “(excluding any proceeding or petition instituted
or presented by Party A or its Affiliates)” and (ii) Section 5(a)(vii)(8)
is hereby amended by deleting the words “to (7) (inclusive)” and inserting
lieu thereof “, (3), (4) as amended, (5) and (6) as
amended”.
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(viii)
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The
“Merger Without Assumption” provisions of Section
5(a)(viii) will apply to Party A and will apply to Party
B.
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(d)
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Termination
Events.
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The
statement below that a Termination Event will apply to a specific party means
that upon the occurrence of such a Termination Event, if such specific party
is
the Affected Party with respect to a Tax Event, the Burdened Party with respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that such
an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have the
right to designate an Early Termination Date in accordance with Section 6
of
this Agreement.
2
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(i)
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The
“Illegality” provisions of Section 5(b)(i) will apply to
Party A and will apply to Party B.
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(ii)
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The
“Tax Event” provisions of Section 5(b)(ii) will apply to
Party A except that, for purposes of the application of Section
5(b)(ii)
to Party A, Section 5(b)(ii) is hereby amended by deleting the
words “(x)
any action taken by a taxing authority, or brought in a court of
competent
jurisdiction, on or after the date on which a Transaction is entered
into
(regardless of whether such action is taken or brought with respect
to a
party to this Agreement) or (y)”, and the “Tax Event”
provisions of Section 5(b)(ii) will apply to Party
B.
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(iii)
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The
“Tax Event Upon Merger” provisions of Section 5(b)(iii)
will apply to Party A and will apply to Party B, provided that
Party A
shall not be entitled to designate an Early Termination Date by
reason of
a Tax Event upon Merger in respect of which it is the Affected
Party.
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(iv)
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The
“Credit Event Upon Merger” provisions of Section 5(b)(iv)
will not apply to Party A and will not apply to Party
B.
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(e)
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The
“Automatic Early Termination” provision of Section 6(a)
will not apply to Party A and will not apply to Party
B.
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(f)
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Payments
on Early Termination. For the purpose of Section 6(e)
of this Agreement:
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(i)
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Market
Quotation will apply, provided, however, that, in the event of
a
Derivative Provider Trigger Event, the following provisions will
apply:
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(A)
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The
definition of Market Quotation in Section 14 shall be deleted in
its
entirety and replaced with the
following:
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“Market
Quotation” means, with respect to one or more Terminated
Transactions, a Firm Offer which is (1) made by a Reference Market-maker
that is
an Eligible Replacement, (2) for an amount that would be paid to Party B
(expressed as a negative number) or by Party B (expressed as a positive number)
in consideration of an agreement between Party B and such Reference Market-maker
to enter into a Replacement Transaction, and (3) made on the basis that Unpaid
Amounts in respect of the Terminated Transaction or group of Transactions
are to
be excluded but, without limitation, any payment or delivery that would,
but for
the relevant Early Termination Date, have been required (assuming satisfaction
of each applicable condition precedent) after that Early Termination Date
is to
be included.
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(B)
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The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
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“Settlement
Amount” means, with respect to any Early Termination Date, an
amount (as determined by Party B) equal to:
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(a)
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If
a Market Quotation for the relevant Terminated Transaction or group
of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days after
the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case no
later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
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3
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(b)
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If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding and
one or
more Market Quotations from Approved Replacements have been made
and
remain capable of becoming legally binding upon acceptance, the
Settlement
Amount shall equal the Termination Currency Equivalent of the amount
(whether positive or negative) of the lowest of such Market Quotations
(for the avoidance of doubt, the lowest of such Market Quotations
shall be
the lowest Market Quotation of such Market Quotations expressed
as a
positive number or, if any of such Market Quotations is expressed
as a
negative number, the Market Quotation expressed as a negative number
with
the largest absolute value); or
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(c)
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If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
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(C)
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If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
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(D)
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If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
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“(3)
Second Method and Market Quotation. If the Second Method and
Market Quotation apply, (I) Party B shall pay to Party A an amount
equal
to the absolute value of the Settlement Amount in respect of the
Terminated Transactions, (II) Party B shall pay to Party A the
Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and
(III) Party
A shall pay to Party B the Termination Currency Equivalent of the
Unpaid
Amounts owing to Party B; provided, however, that (x) the amounts
payable
under the immediately preceding clauses (II) and (III) shall be
subject to
netting in accordance with Section 2(c) of this Agreement and (y)
notwithstanding any other provision of this Agreement, any amount
payable
by Party A under the immediately preceding clause (III) shall not
be
netted-off against any amount payable by Party B under the immediately
preceding clause (I).”
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(E)
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At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B shall
be
entitled to accept only the lowest of such Market Quotations (for
the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
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(ii)
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The
Second Method will apply.
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(g)
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“Termination
Currency” means USD.
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(h)
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Additional
Termination Events. Additional Termination Events will
apply as provided in Part 5(c).
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Part
2: Tax Representations
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(a)
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Tax
Representations.
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4
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(i)
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Payer
Representations. For the purpose of Section 3(e) of
this Agreement:
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(A)
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Party
A makes the following
representation(s):
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It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this
representation, it may rely on: the accuracy of any representations made
by the
other party pursuant to Section 3(f) of this Agreement; (ii) the satisfaction
of
the agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement
and
the accuracy and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the
satisfaction of the agreement of the other party contained in Section 4(d)
of
this Agreement, provided that it shall not be a breach of this representation
where reliance is placed on clause (ii) and the other party does not deliver
a
form or document under Section 4(a)(iii) by reason of material prejudice
to its
legal or commercial position.
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(B)
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Party
B makes the following
representation(s):
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None.
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(ii)
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Payee
Representations. For the purpose of Section 3(f) of
this Agreement:
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(A)
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Party
A makes the following
representation(s):
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It
is a
“foreign person” within the meaning of the applicable U.S. Treasury Regulations
concerning information reporting and backup withholding tax (as in effect
on
January 1, 2001), unless Party A provides written notice to Party B that
it is
no longer a foreign person. In respect of any Transaction it enters into
through
an office or discretionary agent in the United States or which otherwise
is
allocated for United States federal income tax purposes to such United States
trade or business, each payment received or to be received by it under such
Transaction will be effectively connected with its conduct of a trade or
business in the United States.
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(B)
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Party
B makes the following
representation(s):
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None.
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(b)
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Tax
Provisions.
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(i)
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Gross
Up. Section 2(d)(i)(4) shall not apply to Party B as
X, and Section 2(d)(ii) shall not apply to Party B as Y, in each
case such
that Party B shall not be required to pay any additional amounts
referred
to therein.
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(ii)
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Indemnifiable
Tax. The definition of “Indemnifiable Tax” in Section
14 is deleted in its entirety and replaced with the
following:
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“Indemnifiable
Tax” means, in relation to payments by Party A, any Tax and, in
relation to payments by Party B, no Tax.
Part
3: Agreement to Deliver Documents
(a)
Tax
forms, documents or certificates to be delivered are:
5
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Party
required to deliver document
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Form/Document/Certificate
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Date
by which to be delivered
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Party
A and Party B
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Any
document required or reasonably requested to allow the other
party to make
payments under this Agreement without any deduction or withholding
for or
on the account of any Tax or with such deduction or withholding
at a
reduced rate.
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Promptly
after the earlier of (i) reasonable demand by either party or
(ii) within
30 days of the execution.
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(b)
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Other
Documents to be delivered are:
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Party
required to deliver document
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Form/Document/Certificate
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Date
by which to be delivered
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Covered
by Section 3(d) representation
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Party
A and Party B
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Any
documents required or reasonably requested by the receiving party
to
evidence authority of the delivering party or its Credit Support
Provider,
if any, to execute and deliver this Agreement, any Confirmation,
and any
Credit Support Documents to which it is a party, and to evidence
the
authority of the delivering party to its Credit Support Provider
to
perform its obligations under this Agreement, such Confirmation
and/or
Credit Support Document, as the case may be.
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Upon
execution.
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Yes
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Party
A and Party B
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A
certificate of an authorized officer of the party, as to the
incumbency
and authority of the respective officers of the party signing
this
Agreement, any relevant Credit Support Document, or any Confirmation,
as
the case may be.
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Upon
execution
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Yes
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Party
A
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Annual
Report of Party A containing consolidated financial statements
certified
by independent certified public accountants and prepared in accordance
with generally accepted accounting principles in the country
in which
Party A is organized and delivered via internet at
xxxx://xxx.xx.xxx/
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Annually,
after becoming publicly available
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Yes
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6
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Party
required to deliver document
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Form/Document/Certificate
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Date
by which to be delivered
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Covered
by Section 3(d) representation
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Party
A
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Quarterly
Financial Statements of Party A containing unaudited, consolidated
financial statements of Party A’s fiscal quarter prepared in accordance
with generally accepted accounting principles in the country
in which
Party A is organized and delivered via internet at
xxxx://xxx.xx.xxx/
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Quarterly,
after becoming publicly available
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Yes
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Party
A
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An
opinion of counsel to such party reasonably satisfactory in form
and
substance to the other party regarding the enforceability of
this
Agreement, any Confirmation, and any Credit Support Documents
to which it
is a party.
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Upon
execution
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No
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Party
B
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Executed
copy of the Pooling and Servicing Agreement
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Upon
execution
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Yes
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Part
4: Miscellaneous
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(a)
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Addresses
for Notices. For the purposes of Section 12(a) of this
Agreement:
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Party
A:
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Address
for notices or communications to Party
A:
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Any
notice to Party A relating to a particular Transaction shall be
delivered
to the address or facsimile number specified in the Confirmation
of such
Transaction. Any notice delivered for purposes of Sections 5
and 6 (other than notices under Section 5(a)(i) with respect to
Party A)
of this Agreement shall be delivered to the following
address:
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Deutsche
Bank AG, Head
Office
Xxxxxxxxxxxx
00
00000
Xxxxxxxxx
Xxxxxxx
Attention:
Legal Department
Facsimile
No: 0049 69 910 36097
Party
B:
Address
for notices or communications to Party B:
Address:
The Bank of New York
000
Xxxxxxx Xxxxxx – 0X Xxxxx
Xxx
Xxxx,
XX 00000
Attention:
Corporate Trust Administration MBS Administration, CWABS Inc., Series
2007-5
Telephone
No.: (000) 000-0000
Facsimile
No.: (000) 000-0000
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(b)
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Process
Agent. For the purposes of Section 13(c) of this
Agreement:
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7
Party
A
appoints as its Process Agent: Not Applicable.
Party
B
appoints as its Process Agent: Not Applicable.
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(c)
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Offices.
The provisions of Section 10(a) will not apply to this
Agreement.
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(d)
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Multibranch
Party. For the purpose of Section 10(c) of this
Agreement:
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Party
A
is not a Multibranch Party.
Party
B
is not a Multibranch Party.
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(e)
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Calculation
Agent. The Calculation Agent is Party A; provided however,
if an Event of Default occurs and is continuing with respect to
Party A,
then Party B shall be entitled to appoint a financial institution
which
would qualify as a Reference Market-maker to act as Calculation
Agent, the
cost for which shall be borne by Party
A.
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(f)
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Credit
Support Document. Credit Support Document
means
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Party
A:
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The
Credit Support Annex, and any guarantee in support of Party A’s
obligations under this Agreement.
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Party
B:
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The
Credit Support Annex, solely in respect of Party B’s obligations under
Paragraph 3(b) of the Credit Support
Annex.
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(g)
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Credit
Support Provider.
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Party
A:
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The
guarantor under any guarantee in support of Party A’s obligations under
this Agreement.
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Party
B:
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None.
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(h)
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(i)
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Netting
of Payments. Subparagraph (ii) of Section 2(c) of this
Agreement will apply to all
Transactions.
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(j)
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“Affiliate”
will have the meaning specified in Section 14 of this Agreement,
provided,
however, that Party B shall be deemed to have no Affiliates for
purposes
of this Agreement, including for purposes of Section
6(b)(ii).
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Part
5: Other Provisions
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(a)
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Definitions.
Unless otherwise specified in a Confirmation, this Agreement
and
each Transaction under this Agreement are subject to the 2000 ISDA
Definitions as published and copyrighted in 2000 by the International
Swaps and Derivatives Association, Inc. (the
“Definitions”), and will be governed in all relevant
respects by the provisions set forth in the Definitions, without
regard to
any amendment to the Definitions subsequent to the date
hereof. The provisions of the Definitions are hereby
incorporated by reference in and shall be deemed a part of this
Agreement,
except that (i) references in the Definitions to a “Swap Transaction”
shall be deemed references to a “Transaction” for purposes of this
Agreement, and (ii) references to a “Transaction” in this Agreement shall
be deemed references to a “Swap Transaction” for purposes of the
Definitions.
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(b)
|
Amendments
to ISDA Master
Agreement.
|
8
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(i)
|
Single
Agreement. Section 1(c) is hereby amended by the
adding the words “including, for the avoidance of doubt, the Credit
Support Annex” after the words “Master
Agreement”.
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(ii)
|
Conditions
Precedent.
|
Section
2(a)(iii) is hereby amended by adding the following at the end
thereof:
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Notwithstanding
anything to the contrary in Section 2(a)(iii)(1), if an Event of Default
with
respect to Party B or Potential Event of Default with respect to Party B
has
occurred and been continuing for more than 30 Local Business Days and no
Early
Termination Date in respect of the Affected Transactions has occurred or
been
effectively designated by Party A, the obligations of Party A under Section
2(a)(i) shall cease to be subject to the condition precedent set forth in
Section 2(a)(iii)(1) with respect to such specific occurrence of such Event
of
Default or such Potential Event of Default (the “Specific
Event”); provided, however, for the avoidance of doubt, the obligations
of Party A under Section 2(a)(i) shall be subject to the condition precedent
set
forth in Section 2(a)(iii)(1) (subject to the foregoing) with respect to
any
subsequent occurrence of the same Event of Default with respect to Party
B or
Potential Event of Default with respect to Party B after the Specific Event
has
ceased to be continuing and with respect to any occurrence of any other Event
of
Default with respect to Party B or Potential Event of Default with respect
to
Party B that occurs subsequent to the Specific Event.
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(iii)
|
Change
of Account. Section 2(b) is hereby amended by the
addition of the following after the word “delivery” in the first line
thereof:
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“to
another account in the same legal and tax jurisdiction as the original
account”.
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(iv)
|
Representations. Section
3 is hereby amended by adding at the end thereof the following
subsection
(g):
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“(g)
|
Relationship
Between Parties.
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(1)
|
Nonreliance. (i)
It is not relying on any statement or representation of the other
party
regarding the Transaction (whether written or oral), other than
the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and upon
any
advice from such advisors as it has deemed necessary and not upon
any view
expressed by the other party.
|
|
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate
(internally or through independent professional advice) the Transaction
and has made its own decision subject to Section 6(n) of this Agreement
to
enter into the Transaction and (ii) It understands the terms, conditions
and risks of the Transaction and is willing and able to accept
those terms
and conditions and to assume those risks, financially and
otherwise.
|
|
|
(3)
|
Purpose. It
is entering into the Transaction for the purposes of managing its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of
business.
|
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent,
fiduciary or advisor for it in respect of the
Transaction.
|
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as
such term is defined in, Section 35.1(b)(2) of the regulations
(17 C.F.R.
35) promulgated under, and an “eligible contract participant” as defined
in Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
9
|
|
(v)
|
Transfer
to Avoid Termination Event. Section 6(b)(ii) is hereby
amended by (i) deleting the words “or if a Tax Event Upon Merger occurs
and the Burdened Party is the Affected Party,” and (ii) by deleting the
words “to transfer” and inserting the words “to effect a Permitted
Transfer” in lieu thereof.
|
|
|
(vi)
|
Jurisdiction.
Section 13(b) is hereby amended by: (i) deleting in the
second
line of subparagraph (i) thereof the word "non-", (ii) deleting
“; and”
from the end of subparagraph 1 and inserting “.” in lieu thereof, and
(iii) deleting the final paragraph
thereof.
|
|
|
(vii)
|
Local
Business Day. The definition of Local Business Day in
Section 14 is hereby amended by the addition of the words “or any Credit
Support Document” after “Section 2(a)(i)” and the addition of the words
“or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events. The following Additional
Termination Events will apply:
|
|
|
(i)
|
First
Rating Trigger Collateral. If (A) it is not the case
that a Xxxxx’x Second Trigger Ratings Event has occurred and been
continuing for 30 or more Local Business Days and (B) Party A has
failed
to comply with or perform any obligation to be complied with or
performed
by Party A in accordance with the Credit Support Annex, then an
Additional
Termination Event shall have occurred with respect to Party A and
Party A
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
|
|
(ii)
|
Second
Rating Trigger Replacement. If (A) a Required Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days and (B) (i) at least one Eligible Replacement has
made a
Firm Offer to be the transferee of all of Party A’s rights and obligations
under this Agreement (and such Firm Offer remains an offer that
will
become legally binding upon such Eligible Replacement upon acceptance
by
the offeree) and/or (ii) an Eligible Guarantor has made a Firm
Offer to
provide an Eligible Guarantee (and such Firm Offer remains an offer
that
will become legally binding upon such Eligible Guarantor immediately
upon
acceptance by the offeree), then an Additional Termination Event
shall
have occurred with respect to Party A and Party A shall be the
sole
Affected Party with respect to such Additional Termination
Event.
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|
|
(iii)
|
Supplemental
Pooling and Servicing Agreement Without Party A’s Prior Written
Consent. If Party B enters into an amendment and or supplement
to
the Pooling and Servicing Agreement or other modification to the
Pooling
and Servicing Agreement that could reasonably be expected to have
a
material adverse effect on Party A (excluding, for the avoidance
of doubt,
any amendment to the Pooling and Servicing Agreement that is entered
into
solely for the purpose of appointing a successor master servicer
or
trustee) without the prior written consent (such consent not to
be
unreasonably withheld) of Party A where such consent is required,
then an
Additional Termination Event shall have occurred with respect to
Party B
and Party B shall be the sole Affected Party with respect to such
Additional Termination Event. Party B agrees with Party A that
Party A shall be an express third-party beneficiary of the Pooling
and
Servicing Agreement.
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|
|
(iv)
|
[Reserved]
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|
|
(v)
|
[Reserved]
|
|
(d)
|
Required
Ratings Downgrade Event. In the event that no Relevant
Entity has credit ratings at least equal to the Required Ratings
Threshold
(such event, a “Required Ratings Downgrade Event”), then
Party A shall, as soon as reasonably practicable and so long as
a Required
Ratings Downgrade Event is in effect, at its own expense, using
commercially reasonable efforts, procure either (A) a Permitted
Transfer
or (B) an Eligible Guarantee from an Eligible
Guarantor.
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10
|
(e)
|
Regulation
AB Compliance. Party A and Party B hereby agree that
the terms of the Item 1115 Agreement dated as of April 27, 2006
(the
“Regulation AB Agreement”), between Countrywide Home Loans, Inc., CWABS,
Inc., CWMBS, Inc., CWALT, Inc., CWHEQ, Inc. and Deutsche Bank AG,
New York
Branch shall be incorporated by reference into this Agreement so
that
Party B shall be an express third party beneficiary of the Regulation
AB
Agreement. A copy of the Regulation AB Agreement is attached
hereto as Exhibit A.
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|
(f)
|
Transfers.
|
|
|
(i)
|
Section
7 is hereby amended to read in its entirety as
follows:
|
“Subject
to Section 6(b)(ii), Part 5(d) and the Regulation AB Agreement, neither Party
A
nor Party B is permitted to assign, novate or transfer (whether by way of
security or otherwise) as a whole or in part any of its rights, obligations
or
interests under the Agreement or any Transaction without (a) the prior written
consent of the other party and (b) satisfaction of the Rating Agency Condition
with respect to S&P.”
|
|
(ii)
|
If
an Eligible Replacement has made a Firm Offer (which remains an
offer that
will become legally binding upon acceptance by Party B) to be
the transferee pursuant to a Permitted Transfer, Party B shall,
at Party
A’s written request and at Party A’s expense, take any reasonable steps
required to be taken by Party B to effect such
transfer.
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|
(g)
|
Non-Recourse. Party
A acknowledges and agrees that, notwithstanding any provision in
this
Agreement to the contrary, the obligations of Party B hereunder
are
limited recourse obligations of Party B, payable solely from the
Swap
Trust and the proceeds thereof, in accordance with the priority
of
payments and other terms of the Pooling and Servicing Agreement
and that
Party A will not have any recourse to any of the directors, officers,
employees, shareholders or affiliates of the Party B with respect
to any
claims, losses, damages, liabilities, indemnities or other obligations
in
connection with any transactions contemplated hereby. In the event
that
the Swap Trust and the proceeds thereof, should be insufficient
to satisfy
all claims outstanding and following the realization of the account
held
by the Swap Trust and the proceeds thereof, any claims against
or
obligations of Party B under the ISDA Master Agreement or any other
confirmation thereunder still outstanding shall be extinguished
and
thereafter not revive. Party B shall not have liability for any
failure or delay in making a payment hereunder to Party A due to
any
failure or delay in receiving amounts in the account held by the
Swap
Trust from the Trust created pursuant to the Pooling and Servicing
Agreement.
|
|
(h)
|
Timing
of Payments by Party B upon Early
Termination. Notwithstanding anything to the contrary
in Section 6(d)(ii), to the extent that all or a portion (in either
case,
the “Unfunded Amount”) of any amount that is calculated as being due in
respect of any Early Termination Date under Section 6(e) from Party
B to
Party A will be paid by Party B from amounts other than any upfront
payment paid to Party B by an Eligible Replacement that has entered
a
Replacement Transaction with Party B, then such Unfunded Amount
shall be
due on the next subsequent Distribution Date following the date
on which
the payment would have been payable as determined in accordance
with
Section 6(d)(ii), and on any subsequent Distribution Dates until
paid in
full (or if such Early Termination Date is the final Distribution
Date, on
such final Distribution Date); provided, however, that if the date
on
which the payment would have been payable as determined in accordance
with
Section 6(d)(ii) is a Distribution Date, such payment will be payable
on
such Distribution Date.
|
|
(i)
|
Rating
Agency Notifications. Notwithstanding any other
provision of this Agreement, no Early Termination Date shall be
effectively designated hereunder by Party B and no transfer of
any rights
or obligations under this Agreement shall be made by either party
unless
each Swap Rating Agency has been given prior written notice of
such
designation or transfer.
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11
|
(j)
|
No
Set-off. Except as expressly provided for in Section
2(c), Section 6, Paragraph 8 of the Credit Support Annex or Part
1(f)(i)(D) hereof, and notwithstanding any other provision of this
Agreement or any other existing or future agreement, each party
irrevocably waives any and all rights it may have to set off, net,
recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against
any
obligation between it and the other party under any other
agreements. Section 6(e) shall be amended by deleting the
following sentence: “The amount, if any, payable in respect of an Early
Termination Date and determined pursuant to this Section will be
subject
to any Set-off.”.
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(k)
|
Amendment. Notwithstanding
any provision to the contrary in this Agreement, no amendment of
either
this Agreement or any Transaction under this Agreement shall be
permitted
by either party unless each of the Swap Rating Agencies has been
provided
prior written notice of the same and S&P confirms in writing
(including by facsimile transmission) that it will not downgrade,
withdraw
or otherwise modify its then-current ratings of the
Certificates.
|
|
(l)
|
Notice
of Certain Events or Circumstances. Each Party agrees,
upon learning of the occurrence or existence of any event or condition
that constitutes (or that with the giving of notice or passage
of time or
both would constitute) an Event of Default or Termination Event
with
respect to such party, promptly to give the other Party and to
each Swap
Rating Agency notice of such event or condition; provided that
failure to
provide notice of such event or condition pursuant to this Part
5(l) shall
not constitute an Event of Default or a Termination
Event.
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|
(m)
|
Proceedings. No
Relevant Entity shall institute against, or cause any other person
to
institute against, or join any other person in instituting against
Party
B, the Swap Trust, or the Trust formed pursuant to the Pooling
and
Servicing Agreement, in any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other proceedings under
any
federal or state bankruptcy or similar law for a period of one
year (or,
if longer, the applicable preference period) and one day following
payment
in full of the Certificates. This provision will survive the
termination of this Agreement.
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|
(n)
|
Swap
Contract Administrator Liability Limitations. Party A
and Party B agree to the following: (a) The Bank of New York (“BNY”) is
entering into this Agreement not in its individual or corporate
capacity,
but solely in its capacity as Swap Contract Administrator for CWABS
Asset-Backed Certificates Trust 2007-5; (b) in no case shall BNY
(or any
person acting as successor Swap Contract Administrator for CWABS
Asset-Backed Certificates Trust 2007-5) be personally liable for
or on
account of any of the statements, representations, warranties,
covenants
or obligations stated to be those of Party B under the terms of
this
Agreement, all such liability, if any, being expressly waived by
Party A
and any person claiming by, through or under Party A; and (c) recourse
against Party B shall be limited to the assets available under
the Pooling
and Servicing Agreement. This Part 5(n) shall survive the termination
of
this Agreement.
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|
(o)
|
Severability. If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) in any respect,
the
remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long as
this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement will
not
substantially impair the respective benefits or expectations of
the
parties; provided, however, that this severability provision shall
not be
applicable if any provision of Section 2, 5, 6, or 13 (or any definition
or provision in Section 14 to the extent it relates to, or is used
in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
12
|
(p)
|
[Reserved]
|
|
(q)
|
Escrow
Payments. If (whether by reason of the time difference
between the cities in which payments are to be made or otherwise)
it is
not possible for simultaneous payments to be made on any date on
which
both parties are required to make payments hereunder, either Party
may at
its option and in its sole discretion notify the other Party that
payments
on that date are to be made in escrow. In this case deposit of
the payment due earlier on that date shall be made by 2:00 pm (local
time
at the place for the earlier payment) on that date with an escrow
agent
selected by the notifying party, accompanied by irrevocable payment
instructions (i) to release the deposited payment to the intended
recipient upon receipt by the escrow agent of the required deposit
of any
corresponding payment payable by the other party on the same date
accompanied by irrevocable payment instructions to the same effect
or (ii)
if the required deposit of the corresponding payment is not made
on that
same date, to return the payment deposited to the party that paid
it into
escrow. The party that elects to have payments made in escrow
shall pay all costs of the escrow
arrangements.
|
|
(r)
|
Consent
to Recording. Each party hereto consents to the
monitoring or recording, at any time and from time to time, by
the other
party of any and all communications between trading, marketing,
and
operations personnel of the parties and their Affiliates, waives
any
further notice of such monitoring or recording, and agrees to notify
such
personnel of such monitoring or
recording.
|
|
(s)
|
Waiver
of Jury Trial. Each party waives any right it may have
to a trial by jury in respect of any in respect of any suit, action
or
proceeding relating to this Agreement or any Credit Support
Document.
|
|
(t)
|
[Reserved]
|
|
(u)
|
[Reserved]
|
|
(v)
|
Additional
representations.
|
|
|
(i)
|
Capacity. Party
A represents to Party B on the date on which Party A enters into
this
Agreement that it is entering into the Agreement and the Transaction
as
principal and not as agent of any person. Party B represents to
Party A on the date on which Party B enters into this Agreement
it is
entering into the Agreement and the Transaction in its capacity
as Swap
Contract Administrator.
|
|
(w)
|
Acknowledgements.
|
|
|
(i)
|
Substantial
financial transactions. Each party hereto is hereby
advised and acknowledges as of the date hereof that the other party
has
engaged in (or refrained from engaging in) substantial financial
transactions and has taken (or refrained from taking) other material
actions in reliance upon the entry by the parties into the Transaction
being entered into on the terms and conditions set forth herein
and in the
Pooling and Servicing Agreement relating to such Transaction, as
applicable. This paragraph shall be deemed repeated on the trade
date of
each Transaction.
|
|
|
(ii)
|
Bankruptcy
Code. Subject to Part 5(m), without limiting the
applicability if any, of any other provision of the U.S. Bankruptcy
Code
as amended (the “Bankruptcy Code”) (including without limitation Sections
362, 546, 556, and 560 thereof and the applicable definitions in
Section
101 thereof), the parties acknowledge and agree that all Transactions
entered into hereunder will constitute “forward contracts” or “swap
agreements” as defined in Section 101 of the Bankruptcy Code or “commodity
contracts” as defined in Section 761 of the Bankruptcy Code, that the
rights of the parties under Section 6 of this Agreement will constitute
contractual rights to liquidate Transactions, that any margin or
collateral provided under any margin, collateral, security, pledge,
or
similar agreement related hereto will constitute a “margin payment” as
defined in Section 101 of the Bankruptcy Code, and that the parties
are
entities entitled to the rights under, and protections afforded
by,
Sections 362, 546, 556, and 560 of the Bankruptcy
Code.
|
13
|
(x)
|
[Reserved]
|
|
(y)
|
[Reserved]
|
|
(z)
|
Additional
Definitions.
|
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Approved
Ratings Threshold” means each of the S&P Approved Ratings
Threshold and the Moody’s First Trigger Ratings Threshold.
“Approved
Replacement” means, with respect to a Market Quotation, an entity
making such Market Quotation, which entity would satisfy conditions (a),
(b),
(c) and (e) of the definition of Permitted Transfer (as determined by Party
B in
its sole discretion, acting in a commercially reasonable manner) if such
entity
were a Transferee, as defined in the definition of Permitted
Transfer.
“Derivative
Provider Trigger Event” means (i) an Event of Default with respect
to which Party A is a Defaulting Party, (ii) a Termination Event with respect
to
which Party A is the sole Affected Party or (iii) an Additional Termination
Event with respect to which Party A is the sole Affected Party.
“Eligible
Guarantee” means an unconditional and irrevocable guarantee of all
present and future obligations (for the avoidance of doubt, not limited to
payment obligations) of Party A or an Eligible Replacement to Party A under
this
Agreement that is provided by an Eligible Guarantor as principal debtor rather
than surety and that is directly enforceable by Party B, the form and substance
of which guarantee are subject to the Rating Agency Condition with respect
to
S&P, and either (A) a law firm has given a legal opinion confirming that
none of the guarantor’s payments to Party B under such guarantee will be subject
to Tax collected by withholding or (B) such guarantee provides that, in the
event that any of such guarantor’s payments to Party B are subject to Tax
collected by withholding, such guarantor is required to pay such additional
amount as is necessary to ensure that the net amount actually received by
Party
B (free and clear of any Tax collected by withholding) will equal the full
amount Party B would have received had no such withholding been
required.
“Eligible
Guarantor” means an entity that (A) has credit ratings from
S&P at least equal to the S&P Approved Ratings Threshold and (B) has
credit ratings from Moody’s at least equal to the Moody’s Second Trigger Ratings
Threshold, provided, for the avoidance of doubt, that an Eligible Guarantee
of
an Eligible Guarantor with credit ratings below the Moody’s First Trigger
Ratings Threshold will not cause a Collateral Event (as defined in the Credit
Support Annex) not to occur or continue with respect to Moody’s.
“Eligible
Replacement” means an entity (A)(i)(a) that has credit ratings
from S&P at least equal to the S&P Approved Ratings Threshold and (b)
has credit ratings from Moody’s at least equal to the Moody’s Second Trigger
Ratings Threshold, provided, for the avoidance of doubt, that an Eligible
Replacement with credit ratings below the Moody’s First Trigger Ratings
Threshold will not cause a Collateral Event (as defined in the Credit Support
Annex) not to occur or continue with respect to Moody’s or (ii) the present and
future obligations (for the avoidance of doubt, not limited to payment
obligations) of which entity to Party B under this Agreement are guaranteed
pursuant to an Eligible Guarantee and (B) that has executed an Item 1115
Agreement with the Depositor.
“Firm
Offer” means (A) with respect to an Eligible Replacement, a
quotation from such Eligible Replacement (i) in an amount equal to the actual
amount payable by or to Party B in consideration of an agreement between
Party B
and such Eligible Replacement to replace Party A as the counterparty to this
Agreement by way of novation or, if such novation is not possible, an agreement
between Party B and such Eligible Replacement to enter into a Replacement
Transaction (assuming that all Transactions hereunder become Terminated
Transactions), and (ii) that constitutes an offer by such Eligible Replacement
to replace Party A as the counterparty to this Agreement or enter a Replacement
Transaction that will become legally binding upon such Eligible Replacement
upon
acceptance by Party B, and (B) with respect to an Eligible Guarantor, an
offer
by such Eligible Guarantor to provide an Eligible Guarantee that will become
legally binding upon such Eligible Guarantor upon acceptance by the
offeree.
14
“Moody’s”
means Xxxxx’x Investors Service, Inc., or any successor thereto.
“Moody’s
First Trigger Ratings Threshold” means, with respect to Party A,
the guarantor under an Eligible Guarantee or an Eligible Replacement, (i)
if
such entity has a short-term unsecured and unsubordinated debt rating from
Moody’s, a long-term unsecured and unsubordinated debt rating or counterparty
rating from Moody’s of “A2” and a short-term unsecured and unsubordinated debt
rating from Moody’s of “Prime-1”, or (ii) if such entity does not have a
short-term unsecured and unsubordinated debt rating or counterparty rating
from
Moody’s, a long-term unsecured and unsubordinated debt rating or counterparty
rating from Moody’s of “A1”.
“Moody’s
Second Trigger Ratings Event” means that no Relevant Entity has
credit ratings from Moody’s at least equal to the Moody’s Second Trigger Rating
Threshold.
“Moody’s
Second Trigger Ratings Threshold” means, with respect to Party A,
the guarantor under an Eligible Guarantee or an Eligible Replacement, (i)
if
such entity has a short-term unsecured and unsubordinated debt rating from
Moody’s, a long-term unsecured and unsubordinated debt rating or counterparty
rating from Moody’s of “A3” and a short-term unsecured and unsubordinated debt
rating from Moody’s of “Prime-2”, or (ii) if such entity does not have a
short-term unsecured and unsubordinated debt rating from Moody’s, a long-term
unsecured and unsubordinated debt rating or counterparty rating from Moody’s of
“A3”.
“Permitted
Transfer” means a transfer by novation by Party A to a transferee
(the “Transferee”) of all, but not less than all, of Party A’s rights,
liabilities, duties and obligations under this Agreement, with respect to
which
transfer each of the following conditions is satisfied: (a) the
Transferee is an Eligible Replacement that is a recognized dealer in interest
rate swaps organized under the laws of the United States of America or a
jurisdiction located in the United States of America (or another jurisdiction
reasonably acceptable to Party B), (b) an Event of Default or Termination
Event
would not occur as a result of such transfer, (c) pursuant to a written
instrument (the “Transfer Agreement”), the Transferee acquires and assumes all
rights and obligations of Party A under the Agreement and the relevant
Transaction, (d) Party B shall have determined, in its sole discretion, acting
in a commercially reasonable manner, that such Transfer Agreement is effective
to transfer to the Transferee all, but not less than all, of Party A’s rights
and obligations under the Agreement and all relevant Transactions; (e) Party
A
will be responsible for any costs or expenses incurred in connection with
such
transfer (including any replacement cost of entering into a replacement
transaction); (f) Moody’s has been given prior written notice of such transfer
and the Rating Agency Condition is satisfied with respect to S&P and (g)
such transfer otherwise complies with the terms of the Pooling and Servicing
Agreement.
“Rating
Agency Condition” means, with respect to any particular proposed
act or omission to act hereunder and each Swap Rating Agency specified in
connection with such proposed act or omission, that the party acting or failing
to act must consult with each of the specified Swap Rating Agencies and receive
from each such Swap Rating Agency a prior written confirmation that the proposed
action or inaction would not cause a downgrade or withdrawal of the then-current
rating of any Certificates.
“Relevant
Entity” means Party A and, to the extent applicable, a guarantor
under an Eligible Guarantee.
“Replacement
Transaction” means, with respect to any Terminated Transaction or
group of Terminated Transactions, a transaction or group of transactions
that
(i) would have the effect of preserving for Party B the economic equivalent
of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition precedent)
by the parties under Section 2(a)(i) in respect of such Terminated Transaction
or group of Terminated Transactions that would, but for the occurrence of
the
relevant Early Termination Date, have been required after that Date, and
(ii)
has terms which are substantially the same as this Agreement, including,
without
limitation, rating triggers, Regulation AB compliance, and credit support
documentation, save for the exclusion of provisions relating to Transactions
that are not Terminated Transactions, as determined by Party B in its sole
discretion, acting in a commercially reasonable manner.
15
“Required
Ratings Downgrade Event” shall have the meaning assigned thereto
in Part 5(d).
“Required
Ratings Threshold” means each of the S&P Required Ratings
Threshold and the Moody’s Second Trigger Ratings Threshold.
“S&P”
means Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx
Companies, Inc., or any successor thereto.
“S&P
Approved Ratings Threshold” means, with respect to Party A, the
guarantor under an Eligible Guarantee or an Eligible Replacement, a short-term
unsecured and unsubordinated debt rating from S&P of “A-1”, or, if such
entity does not have a short-term unsecured and unsubordinated debt rating
from
S&P, a long-term unsecured and unsubordinated debt rating from S&P of
“A+”.
“S&P
Required Ratings Threshold” means, with respect to Party A, the
guarantor under an Eligible Guarantee or an Eligible Replacement, a long-term
unsecured and unsubordinated debt rating from S&P of “BBB+”.
“Swap
Rating Agencies” means, with respect to any date of determination,
each of S&P and Moody’s, to the extent that each such rating agency is then
providing a rating for any of the Certificates.
16
IN
WITNESS WHEREOF, the parties have executed this document by their duly
authorized officers with effect from the date so specified on the first page
hereof.
|
DEUTSCHE
BANK AG, NEW YORK BRANCH
|
THE
BANK OF NEW YORK, not in its individual or corporate capacity but
solely
as Swap Contract Administrator and Corridor Contract Administrator
for
CWABS Asset-Backed Certificates Trust 2007-5
|
|
(“Party
A”)
|
(“Party
B”)
|
|
By:
/s/ Xxxxxxxx Xxxx
Name:
Xxxxxxxx Xxxx
Title:
Vice President
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By:
/s/ Xxxxxxxx Xxxxxx
Name:
Xxxxxxxx Xxxxxx
Title: Vice
President
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By:
/s/ Xxxxxxx Xxxx
Name:
Xxxxxxx Xxxx
Title:
Director
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17
EXHIBIT
A
Item
1115
Agreement dated as of April 27, 2006 (this "Agreement"), between COUNTRYWIDE
HOME LOANS, INC., a New York corporation ("CHL"), CWABS, INC., a Delaware
corporation ("CWABS"), CWMBS, Inc., a Delaware corporation ("CWMBS"), CWALT,
Inc., a Delaware corporation ("CWALT"), CWHEQ, Inc., a Delaware corporation
("CWHEQ") and DEUTSCHE BANK AG, NEW YORK BRANCH, as counterparty (the
"Counterparty").
RECITALS
WHEREAS,
CWABS, CWMBS, CWALT and CWHEQ each have filed Registration Statements on
Form
S-3 (each, a "Registration Statement") with the Securities and Exchange
Commission (the "Commission") for purposes of offering mortgage backed
or
asset-backed notes and/or certificates (the "Securities") through special
purpose vehicles (each, an "SPV").
WHEREAS,
from time to time, on the closing date (the "Closing Date") of a transaction
pursuant to which Securities are offered (each, a "Transaction"), the
Counterparty and the SPV, CHL or an underwriter or dealer with respect
to the
Transaction, enter into certain derivative agreements (each, a "Derivative
Agreement"), including interest rate caps and interest rate or currency
swaps,
for purposes of providing certain yield enhancements to the SPV or the
related
trustee on behalf of the SPV or a swap or corridor contract administrator
(each,
an "Administrator").
WHEREAS,
the Counterparty is a foreign private issuer currently subject to the periodic
reporting requirements of Section 13(a) of the Securities Exchange Act
of 1934,
as amended and the rules and regulations promulgated thereunder (the "Exchange
Act"). Pursuant to such requirements, it files an Annual Report on Form
20-F
with the SEC. The Counterparty publishes Interim Reports for each of the
first
three quarters of its fiscal year, each containing unaudited interim financial
statements for such quarter. Pursuant to the Exchange Act, it submits such
Interim Reports to the SEC on Reports on Form 6-K. The Counterparty transmits
its Annual Reports on Form 20-F and Reports on Form 6-K to the SEC via
the SEC's
XXXXX System, and such reports are available on the SEC's XXXXX internet
site
under File Number 001-15242.
NOW,
THEREFORE, in consideration of the mutual agreements set forth herein and
for
other good and valuable consideration, the receipt and adequacy of which
is
hereby acknowledged, the parties hereby agree as follows with respect to any
Transaction with respect to which the terms of this Agreement are incorporated
by reference:
Section
1. Definitions
Company
Information: As defined in Section 5(a)(i).
Company
Financial Information: As defined in the definition of "Pre-Closing Termination
Event".
Depositor:
Means CWABS, CWMBS, CWALT or CWHEQ with respect to the related Registration
Statement for which the entity is the registrant.
GAAP:
As
defined in Section 3(a)(v).
XXXXX:
The Commission's Electronic Data Gathering, Analysis and Retrieval
system.
Exchange
Act: Has the meaning set forth in the recitals.
Exchange
Act Reports: All Distribution Reports on Form 10-D, Current Reports on
Form 8-K
and Annual Reports on Form 10-K that are to be filed with respect to the
related
SPV pursuant to the Exchange Act.
IFRS:
Has
the meaning set forth in Section 3(a)(v).
Indemnified
Party: As defined in Section 5(a).
IRC:
The
requirements of Section 1100(c) of Regulation AB, the Securities Act and
the
Exchange Act with respect to incorporation by reference.
Master
Agreement: The ISDA Master Agreement between the Counterparty and SPV,
or if no
such Master Agreement exists, the ISDA Master Agreement assumed to apply
to the
Derivative Agreement pursuant to its terms.
Pre-Closing
Termination Event: Prior to printing the related Prospectus Supplement,
any of
the following occurs:
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(i)
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the
Counterparty shall fail to provide to the related Depositor such
information regarding the Counterparty, as a derivative instrument
counterparty, as is reasonably requested by the related Depositor
for the
purpose of compliance with Item 1115(a)(1) of Regulation AB.
Such
information shall include, at a
minimum:
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(A)
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the
Counterparty's legal name (and any
d/b/a);
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(B)
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the
organizational form of the
Counterparty;
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(C)
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a
description of the general character of the business of the Counterparty;
or
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(ii)
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the
Counterparty shall fail to take the actions set forth below if
reasonably
requested by the related Depositor for the purpose of compliance
with Item
1115(b) with respect to a
Transaction:
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2
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(A)
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either
(1) authorize the related Depositor to incorporate by reference
the
financial data required by Item 1115(b)(1) or (b)(2) of Regulation
AB (as
specified by the related Depositor to the Counterparty) with
respect to
the Counterparty and any affiliated entities providing derivative
instruments to the SPV (the "Company Financial Information")
or (2)
provide the Company Financial Information, in a form appropriate
for use
in the Prospectus Supplement and in an XXXXX-compatible form
(and in any
event to provide such XXXXX-compatible form if the IRC are not
satisfied);
and
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(B)
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if
applicable, cause its accountants to issue their consent to the
filing or
the incorporation by reference of such financial statements in
the
Registration Statement.
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Prospectus
Supplement: The prospectus supplement prepared in connection with the public
offering and sale of the related Securities.
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.
Regulation
S-X: 17 C.F.R. ss.210.1-01, as such may be amended from time to
time.
Required
Substitution: Causing another entity (which meets any applicable ratings
threshold in the Derivative Agreement) to replace the Counterparty as party
to
the Derivative Agreement that (i) has signed an agreement with CHL and
the
Depositors substantially in the form of this Agreement, (ii) has agreed
to
deliver any information, report, certification or accountants' consent
as
required by Item 1115(b)(1) or (b)(2) of Regulation AB and (iii) is approved
by
the Depositor (which approval shall not be unreasonably withheld) and any
rating
agency, if applicable, on terms substantially similar to the Derivative
Agreement.
Securities
Act: The Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
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Section
2.
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Counterparty
Actions. Following the Closing Date, and until the related Depositor
takes
the steps necessary to suspend its obligation to file Exchange
Act
Reports, with respect to the SPV, under Sections 13 and 15(d)
of the
Exchange Act, with respect to a Transaction for which the Counterparty
has
agreed to act as derivative
counterparty,
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3
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(a)
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if
the Counterparty provided Company Financial Information to the
related
Depositor for the Prospectus Supplement and the Counterparty
does not,
within 5 Business Days of the release of any updated financial
data on
Form 6-K or 20-F, (1) either authorize the related Depositor
to
incorporate by reference current Company Financial Information
as required
under Item 1115(b) of Regulation AB or provide such information
to the
related Depositor in an XXXXX-compatible form (and in any event
to provide
such XXXXX-compatible form if the IRC are not satisfied), and
(2) if
applicable, cause its accountants to issue their consent to filing
or
incorporation by reference of such financial statements in the
Exchange
Act Reports of the SPV, then the Counterparty shall, at its own
cost, make
a Required Substitution; and
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(b)
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if
the related Depositor requests Company Financial Information
from the
Counterparty, for the purpose of compliance with Item 1115(b)
of
Regulation AB following the Closing Date, and the Counterparty
does not
upon five Business Days written notice, (1) either authorize
the related
Depositor to incorporate by reference current Company Financial
Information as required under Item 1115(b) of Regulation AB or
provide
such information to the related Depositor in an XXXXX-compatible
form (and
in any event to provide such XXXXX-compatible form if the IRC
are not
satisfied), (2) if applicable, cause its accountants to issue
their
consent to filing or incorporation by reference of such financial
statements in the Exchange Act Reports of the SPV and (3) within
5
Business Days of the release of any updated financial data, either
authorize the related Depositor to incorporate by reference current
Company Financial Information as required under Item 1115(b)
of Regulation
AB or provide such information to the related Depositor in an
XXXXX-compatible form (and in any event to provide such XXXXX-compatible
form if the IRC are not satisfied) and if applicable, cause its
accountants to issue their consent to filing or incorporation
by reference
of such financial statements in the Exchange Act Reports of the
SPV, then
the Counterparty shall, at its own cost, make a Required
Substitution.
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Section
3.
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Representations
and Warranties and Covenants of the
Counterparty.
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(a)
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The
Counterparty represents and warrants to the related Depositor,
as of the
date on which information is first provided to the related Depositor
pursuant to this Agreement that, except as disclosed in writing
the
related Depositor prior to such
date:
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(i)
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The
Counterparty is a foreign private issuer as defined in Rule 2b-4
of the
Exchange Act and is currently subject to the periodic reporting
requirements of Section 13(a) of the Exchange
Act.
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4
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(ii)
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The
Counterparty has filed all reports and other materials required
to be
filed by such requirements during the preceding 12 months (or
such shorter
period that such party was required to file such reports and
materials).
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(iii)
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The
reports filed by the Counterparty include (or properly incorporate
by
reference) the financial statements of the
Counterparty.
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(iv)
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The
accountants who certify the financial statements and supporting
schedules
included in the Company Financial Information (if applicable)
are
independent registered public accountants as required by the
Securities
Act.
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(v)
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If
applicable, (A) either (I) the financial statements included
in the
Company Financial Information present fairly the consolidated
financial
position of the Counterparty and its consolidated subsidiaries
as at the
dates indicated and the consolidated results of their operations
and cash
flows for the periods specified; except as otherwise stated in
the Company
Financial Information, said financial statements have been prepared
in
conformity with generally accepted accounting principles ("GAAP")
applied
on a consistent basis; and the supporting schedules included
in the
Company Financial Information present fairly in accordance with
GAAP the
information required to be stated therein or (II) if the Company
has
adopted International Financial Reporting Standards and International
Accounting Standards (collectively "IFRS") for the purpose of
preparing
its financial statements, the Company Financial Information present
fairly
the consolidated financial position of the Counterparty and its
consolidated subsidiaries as at the dates indicated and the consolidated
results of their operations and cash flows for the periods specified;
except as otherwise stated in the Company Financial Information,
said
financial statements have been prepared in conformity with IFRS
applied on
a consistent basis; and the supporting schedules included in
the Company
Financial Information present fairly in accordance with IFRS
the
information required to be stated therein and such Company Financial
Information has been reconciled with GAAP to the extent required
by
Regulation AB.
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(vi)
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The
selected financial data and summary financial information included
in the
Company Financial Information present fairly the information
shown therein
and have been compiled on a basis consistent with that of the
audited
financial statements of the
Counterparty
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5
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(vii)
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The
Company Financial Information and other Company Information included
or
incorporated by reference in the Registration Statement (including
through
filing on an Exchange Act Report), at the time they were or hereafter
are
filed with the Commission, complied in all respects with the
requirements
of Item 1115(b) of Regulation AB (in the case of the Company
Financial
Information) and, did not and will not contain an untrue statement
of a
material fact or omit to state a material fact required to be
stated
therein or necessary in order to make the statements therein,
in the light
of the circumstances under which they were made, not
misleading.
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(viii)
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The
Counterparty is a "Foreign Business" as defined in Regulation
S-X.
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(b)
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If
at any time the representations and warranties set forth in 3(a)(i)
through (iii) are no longer true and correct, the Counterparty
shall
provide notice to the related Depositor, and if any Company Financial
Information is required to be included in the Registration Statement,
or
the Exchange Act Reports of the SPV, will provide to the related
Depositor
such Company Financial Information in XXXXX-compatible format
no later
than the 20th calendar day of the month in which any of the
representations or warranties in Section 3(a)(i) through (iii)
ceased to
be correct.
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(c)
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The
Counterparty agrees that the terms of this Agreement shall be
incorporated
by reference into any Derivative Agreement so that each SPV who
is a
beneficiary of a Derivative Agreement shall be an express third
party
beneficiary of this Agreement.
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(d)
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f
the Counterparty has provided Company Information, upon any breach
by the
Counterparty of a representation or warranty pursuant to this
Section 3 to
the extent made as of a date subsequent to such closing date,
the
Counterparty shall, at its own cost, make a Required
Substitution.
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Section
4.
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Representations
and Warranties and Covenants of the
Depositor.
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(a)
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If
permitted by the Exchange Act, the related Depositor will take
the steps
necessary to suspend its obligation to file Exchange Act Reports,
with
respect to the SPV, under Sections 13 and 15(d) of the Exchange
Act.
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(b)
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If
the related Depositor requests Company Financial Information
from the
Counterparty, it agrees to provide to the Counterparty the methodology
and
calculation for its estimate of maximum probable exposure represented
by
the Derivative Agreements.
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Section
5.
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Indemnification;
Remedies
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6
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(a)
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The
Counterparty shall indemnify CHL and the related Depositor, each
person
responsible for the preparation, execution or filing of any report
required to be filed with the Commission with respect to such
SPV, or for
execution of a certification pursuant to Rule 13a-14(d) or Rule
15d-14(d)
under the Exchange Act; each broker dealer acting as underwriter,
each
person who controls any of such parties (within the meaning of
Section 15
of the Securities Act and Section 20 of the Exchange Act); and
the
respective present and former directors, officers, employees
and agents of
each of the foregoing (each, a "Indemnified Party"), and shall
hold each
of them harmless from and against any losses, damages, penalties,
fines,
forfeitures, legal fees and expenses and related costs, judgments,
and any
other costs, fees and expenses that any of them may sustain arising
out of
or based upon:
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(i)
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(A)
any untrue statement of a material fact contained or alleged
to be
contained in any information, report, accountants' consent or
other
material provided in written or electronic form under this Agreement
by or
on behalf of the Counterparty (collectively, the "Company Information"),
or (B) the omission or alleged omission to state in the Company
Information a material fact required to be stated in the Company
Information or necessary in order to make the statements therein,
in the
light of the circumstances under which they were made, not misleading;
or
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(ii)
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any
breach by the Counterparty of a representation or warranty set
forth in
Section 3(a) and made as of a date prior to the Closing Date,
to the
extent that such breach is not cured by the Closing Date, or
any breach by
the Counterparty of a representation or warranty pursuant to
Section 3 to
the extent made as of a date subsequent to the Closing
Date.
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(b)
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Nothing
in this agreement shall be construed to allow the Indemnified
Party to
recover punitive, consequential, incidental, exemplary or special
damages
or lost profits from the indemnifying
party.
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(c)
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(i)
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Any
Pre-Closing Termination Event or any breach by the Counterparty
of a
representation or warranty set forth in Section 3 and made as
of a date
prior to the Closing Date, to the extent that such Pre-Closing
Termination
Event or breach is not cured by the Closing Date (or in the case
of
information needed for purposes of printing the Prospectus Supplement,
the
date of printing of the Prospectus Supplement), shall, except
as provided
in clause (ii) of this paragraph, immediately and automatically,
without
notice or grace period, constitute an Additional Termination
Event (as
defined in the Master Agreement) with the Counterparty as the
sole
Affected Party (as defined in the Master Agreement) under the
Derivative
Agreement. Following such termination, a termination payment
(if any)
shall be payable by the applicable party as determined by the
application
of Section 6(e)(ii) of the Master Agreement, with Market Quotation
and
Second Method being the applicable method for determining the
termination
payment (notwithstanding anything in the Derivative Agreement
to the
contrary).
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7
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(ii)
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If
the Counterparty has failed to make a Required Substitution when
and as
required under Section 2, which continues unremedied for the
lesser of ten
calendar days after the date on which such information, report,
or
accountants' consent was required to be delivered or such period
in which
the applicable Exchange Act Report for which such information
is required
can be timely filed (without taking into account any extensions
permitted
to be filed), or if the Counterparty has failed to make a Required
Substitution as required under Section 3 within the period in
which the
applicable Exchange Act Report for which such information is
required can
be timely filed, then an Additional Termination Event (as defined
in the
Master Agreement) shall have occurred with the Counterparty as
the sole
Affected Party. In the event that an Early Termination Date is
designated
in connection with such Additional Termination Event, a termination
payment (if any) shall be payable by the applicable party as
of the Early
Termination Date as determined by the application of Section
6(e)(ii) of
the Master Agreement, with Market Quotation and Second Method
being the
applicable method for determining the termination payment (notwithstanding
anything in the Derivative Agreement to the
contrary).
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(iii)
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In
the event that the Counterparty or the SPV has found a replacement
entity
in accordance with a Required Substitution, the Counterparty
shall
promptly reimburse the SPV for all reasonable incidental expenses
incurred
by the SPV, as such are incurred, in connection with the termination
of
the Counterparty as counterparty and the entry into a new Derivative
Agreement. The provisions of this paragraph shall not limit whatever
rights the SPV may have under other provisions of this Agreement
or
otherwise, whether in equity or at law, such as an action for
damages,
specific performance or injunctive
relief.
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Section
6.
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Miscellaneous.
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(a)
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Company
Financial Information. Notwithstanding anything to the contrary
contained
herein, if Regulation AB is amended, or the Commission has issued
interpretive guidance uniformly applicable to registrants of
Asset-Backed
Securities allowing the presentation of the financial information
required
by Item 1115 of Regulation AB with respect to an affiliate of
the
Counterparty rather than the Counterparty and any affiliated
entities
providing derivatives to the SPV, "Company Financial Information"
shall be
deemed to refer to the financial information of such permitted
entity
provided the Counterparty has received written confirmation from
CHL that
no amendment to this Agreement is necessary. The parties shall
reasonably
cooperate with respect to any amendments to this Agreement to
reflect such
amendment or interpretation.
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8
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(b)
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Construction.
Throughout this Agreement, as the context requires, (a) the
singular tense and number includes the plural, and the plural
tense and
number includes the singular; (b) the past tense includes the
present, and
the present tense includes the past; and (c) references to
parties, sections, schedules, and exhibits mean the parties,
sections,
schedules, and exhibits of and to this Agreement. The section
headings in
this Agreement are inserted only as a matter of convenience,
and in no way
define, limit, extend, or interpret the scope of this Agreement
or of any
particular section.
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(c)
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Assignment.
None of the parties may assign their rights under this Agreement
without
the prior written consent of the other parties. Subject to the
foregoing,
this Agreement shall be binding on and inure to the benefit of
the parties
and their respective successors and permitted
assigns.
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(d)
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No
Third-Party Benefits Except as Specified. None of the provisions
of this
Agreement are intended to benefit, or to be enforceable by, any
third-party beneficiaries except the related SPV and any trustee
of an SPV
or any Administrator.
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(e)
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Governing
Law. This Agreement shall be governed by and construed in accordance
with
the internal laws of the State of New York without regard to
the conflict
of laws principles thereof.
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(f)
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Amendment
and Waiver. This Agreement may not be modified or amended except
by an
instrument in writing signed by the parties hereto. No waiver
of any
provision of this Agreement or of any rights or obligations of
any party
under this Agreement shall be effective unless in writing and
signed by
the party or parties waiving compliance, and shall be effective
only in
the specific instance and for the specific purpose stated in
that
writing.
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(g)
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Counterparts.
This Agreement may be executed in one or more counterparts, each
of which
shall be deemed an original, but all of which together shall
constitute
one and the same instrument.
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(h)
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Additional
Documents. Each party hereto agrees to execute any and all further
documents and writings and to perform such other actions which
may be or
become reasonably necessary or expedient to effectuate and carry
out this
Agreement.
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(i)
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Severability.
Any provision hereof which is prohibited or unenforceable shall
be
ineffective only to the extent of such prohibition or unenforceability
without invalidating the remaining provisions
hereof.
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9
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(j)
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Integration.
This Agreement contains the entire understanding of the parties
with
respect to the subject matter hereof. There are no restrictions,
agreements, promises, representations, warranties, covenants
or
undertakings with respect to the subject matter hereof other
than those
expressly set forth or referred to herein. This Agreement supersedes
all
prior agreements and understandings between the parties with
respect to
its subject matter.
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(k)
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Signatory.
The parties hereto agree that while the signatory to this Agreement
is
Deutsche Bank AG, New York Branch, the New York branch of Deutsche
Bank AG
is not for securities law purposes treated as a separate entity
from
Deutsche Bank Aktiengesellschaft, the Exchange Act registrant
and thus the
Company Financial Information to be provided hereunder will be
that of
Deutsche Bank Aktiengesellschaft.
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10
IN
WITNESS WHEREOF, the parties hereto have caused their names to be signed
hereto
by their respective officers thereunto duly authorized as of the day and
year
first above written.
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CWABS,
INC.
By:
/s/ Xxxxx Xxxxxx
Name:
Xxxxx Xxxxxx
Title:Vice
President
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CWMBS,
INC.
By:
/s/ Xxxxx Xxxxxx
Name:
Xxxxx Xxxxxx
Title:Vice
President
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CWALT,
INC.
By:
/s/ Xxxxx Xxxxxx
Name:
Xxxxx Xxxxxx
Title:Vice
President
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11
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CWHEQ,
INC.
By:
/s/ Xxxxx Xxxxxx
Name:
Xxxxx Xxxxxx
Title:Vice
President
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COUNTRYWIDE
HOME LOANS, INC.
By:
/s/ Xxxxxx Xxxxxxx
Name:
Xxxxxx Xxxxxxx
Title:Director
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DEUTSCHE
BANK AG, NEW YORK BRANCH
By:
/s/ Xxxxxxxx Xxxx
Name:
Xxxxxxxx Xxxx
Title:Vice
President
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12
