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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest Event
Reported): August 28, 1998
CWABS, INC., (as depositor under the Pooling and Servicing Agreement,
dated as of August 11, 1998,
providing for the issuance of the CWABS, INC.
Asset-Backed Certificates, Series 1998-2).
CWABS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 333-37539 95-4596514
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(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
4500 Park Granada
Calabasas, California 91302
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(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code (818) 225-3240
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Item 5. Other Events.
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Filing of Certain Materials
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In connection with the issuance of CWABS, INC. Asset-Backed Certificates,
Series 1998-2 (the "Certificates"), CWABS, INC. is filing herewith an opinion of
counsel relating to the characterization of the Certificates for federal income
tax purposes. The opinion is annexed hereto as Exhibit 8.1
Item 7. Financial Statements, Pro Forma Financial
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Information and Exhibits.
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(a) Not applicable.
(b) Not applicable.
(c) Exhibits:
8.1 Opinion of Brown & Wood LLP re Tax Matters.
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* Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the prospectus dated August 21, 1998 and
prospectus supplement dated August 25, 1998, of CWABS, Inc., relating
to its Asset-Backed Certificates, Series 1998-2.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CWABS, INC.
By: /s/ David Walker
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David Walker
Vice President
Dated: August 28, 1998
Exhibit Index
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Exhibit Page
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8.1 Opinion of Brown & Wood LLP re Tax matters 5
Exhibit 8.1
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BROWN & WOOD LLP
One World Trade Center
New York, New York 10048
Telephone: (212) 839-5300
Facsimile: (212) 839-5599
August 28, 1998
Prudential Securities Incorporated
One New York Plaza, 14th Floor
New York, New York 10292
Countrywide Securities Corporation
4500 Park Granada
Calabasas, California 91302
Re: CWABS, Inc.
Asset-Backed Certificates, Series 1998-2
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Ladies and Gentlemen:
We have acted as special counsel for CWABS, Inc., a Delaware corporation
(the "Company"), in connection with the issuance of the CWABS, Inc. Asset-Backed
Certificates of the above-referenced Series (the "Certificates"). The Class
AF-1, Class AF-2, Class AF-3, Class AF-4, Class MF-1, Class MF-2, Class BF,
Class AV-1, Class MV-1, Class MV-2 and Class BV Certificates are referred to
herein as the "Public Certificates".
The Certificates will represent the entire beneficial ownership interest in
a trust fund (the "Trust Fund") to be created pursuant to a Pooling and
Servicing Agreement dated as of August 11, 1998 (the "Pooling and Servicing
Agreement") among the Company, as depositor, Countrywide Home Loans, Inc.
("CHL"), as seller and master servicer, and The Bank of New York, as trustee
(the "Trustee"). The assets of the Trust Fund will consist primarily of a pool
of conventional sub-prime mortgage loans (the "Mortgage Loans") secured by first
and second liens on one- to four-family residential properties. Capitalized
terms not otherwise defined herein have the meanings ascribed to such terms in
the Pooling and Servicing Agreement.
In arriving at the opinions expressed below, we have examined such
documents and records as we have deemed appropriate, including the following:
(1) Signed copy of the Registration Statement on Form S-3 (File No.
333-37539) filed by the Company with the Securities and Exchange Commission
(the "Commission") under the Securities Act of 1933, as amended (the "1933
Act"), on October 9, 1997, together with each amendment thereto (such
registration statement, as amended and as declared effective by the
Commission on November 7, 1997, is referred to herein as the "Registration
Statement").
(2) The Prospectus dated August 21, 1998 (the "Basic Prospectus"), as
supplemented by the Prospectus Supplement relating to the Public
Certificates, dated August 25, 1998 (the "Prospectus Supplement"), in the
form to be filed with the Commission pursuant to Rule 424(b) under the 1933
Act (the Basic Prospectus, as supplemented by the Prospectus Supplement,
the "Prospectus").
(3) The Pooling and Servicing Agreement (together with the Prospectus,
the "Documents").
(4) A specimen Certificate of each Class of Certificates.
In addition, we have made such investigations of such matters of law as we
deemed appropriate as a basis for the opinions expressed below. Further, we have
assumed the genuineness of all signatures and the authenticity of all documents
submitted to us as originals. Our opinions are also based on the assumption that
there are no agreements or understandings with respect to those transactions
contemplated in the Documents other than those contained in the Documents.
Furthermore, our opinions are based on the assumption that all parties to the
Documents will comply with the terms thereof, including all tax reporting
requirements contained therein.
As to any facts material to the following opinions which we did not
independently establish or verify, we have relied upon statements and
representations of the responsible officers and other representatives of the
Company and of public officials and agencies. We have, for purposes of rendering
the opinions, also relied on certain factual, numerical and statistical
information which is based on the assumptions used in pricing the Public
Certificates.
As of the Closing Date, the Upper Tier REMIC and REMIC 1, REMIC 2, and
REMIC 3 (each of REMIC 1, REMIC 2 and REMIC 3, a "Lower Tier REMIC") will each
qualify as a REMIC within the meaning of Section 860D of the Internal Revenue
Code of 1986, as amended (the "Code"), assuming (i) an election is made to treat
the assets of the Upper Tier REMIC and the assets of each Lower Tier REMIC as a
REMIC, (ii) compliance with the Pooling and Servicing Agreement, and (iii)
compliance with changes in the law, including any amendments to the Code or
applicable Treasury regulations thereunder. The Public Certificates and the
Class B-IO Certificates represent ownership of regular interests in the Upper
Tier REMIC. The Class R Certificates represent ownership of the sole class of
residual interest in the Upper Tier REMIC and in each Lower Tier REMIC. The
Carryover Reserve Fund is an outside reserve fund that is not an asset of the
Upper Tier REMIC or any of the Lower Tier REMICs. The rights of the Class AV-1,
Class MV-1, Class MV-2, and Class BV Certificates to receive payments from the
Carryover Reserve Fund represent, for federal income tax purposes, interests in
an interest rate cap contract.
The opinions set forth herein are based upon the existing provisions of the
Code and Treasury regulations issued or proposed thereunder, published Revenue
Rulings and releases of the Internal Revenue Service and existing case law, any
of which could be changed at any time. Any such changes may be retroactive in
application and could modify the legal conclusions upon which such opinions are
based. The opinions expressed herein are limited as described above, and we do
not express an opinion on any other tax aspect of the transactions contemplated
by the documents relating to the transaction.
In rendering the foregoing opinions, we express no opinion as to the laws
of any jurisdiction other than the federal income tax laws of the United States.
This opinion is rendered as of the date hereof and we undertake no obligation to
update this opinion or advise you of any changes in the event there is any
change in legal authorities, facts, assumptions or documents on which this
opinion is based (including the taking of any action by any party to the
Documents pursuant to any opinion of counsel or a waiver), or any inaccuracy in
any of the representations, warranties or assumptions upon which we have relied
in rendering this opinion unless we are specifically engaged to do so. This
opinion is rendered only to those to whom it is addressed and may not be relied
on in connection with any transactions other than the transactions contemplated
herein. This opinion may not be relied upon for any other purpose, or relied
upon by any other person, firm or corporation for any purpose, without our prior
written consent.
Very truly yours,
/s/ Brown & Wood LLP
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