Exhibit 99.9
Item 1115 Agreement dated as of March 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 BANK OF AMERICA, N.A., 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 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 that are
assigned to the SPV or the related trustee on behalf of the SPV or a swap or
corridor contract administrator (each, an "Administrator").
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:
Section 1. Definitions
Company Information: As defined in Section 4(a)(i).
Company Financial Information: As defined in Section 2(a)(ii).
Countrywide Indemnified Party: As defined in Section 4(a).
Counterparty Indemnified Party: As defined in Section 4(b).
Depositor: Means CWABS, CWMBS, CWALT or CWHEQ with respect to
the related Registration Statement for which the entity of the registrant.
GAAP: As defined in Section 3(a)(v).
XXXXX: The Commission's Electronic Data Gathering, Analysis
and Retrieval system.
Exchange Act: The Securities Exchange Act of 1934, as amended
and the rules and regulations promulgated thereunder.
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.
Indemnified Party: As defined in Section 4(b).
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.
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.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
Section 2. Information to be Provided by the Counterparty.
(a) Prior to printing the related Prospectus Supplement,
(i) the Counterparty shall 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:
(A) The Counterparty's legal name (and any d/b/a);
(B) the organizational form of the Counterparty;
(C) a description of the general character of the
business of the Counterparty;
(ii) if requested by the related Depositor for the purpose
of compliance with Item 1115(b) with respect to a
Transaction prior to the related Depositor taking 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, in
accordance with the requirements of Regulation AB,
the Counterparty shall:
2
(A) provide 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"), in a
form appropriate for use in the Prospectus
Supplement and in an XXXXX-compatible form (if
not incorporated by reference) and hereby
authorizes the related Depositor to incorporate by
reference the financial data required by Item
1115(b)(2) of Regulation AB; and
(B) 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.
(b) 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,
(i) if the Counterparty provided Company Financial
Information to the related Depositor for the
Prospectus Supplement, within 5 Business Days of the
release of any updated financial data, the
Counterparty shall (1) provide current Company
Financial Information as required under Item 1115(b)
of Regulation AB to the related Depositor in an
XXXXX-compatible form (if not incorporated by
reference) and hereby authorizes the related Depositor
to incorporate by reference the financial data
required by Item 1115(b)(2) of Regulation AB, 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; and
(ii) 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, the Counterparty shall
upon five Business Days written notice either (A), (1)
provide current Company Financial Information as
required under Item 1115(b) of Regulation AB to the
related Depositor in an XXXXX-compatible form (if not
incorporated by reference) and hereby authorizes the
related Depositor to incorporate by reference the
financial data required by Item 1115(b)(2) of
Regulation AB, (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, provide current Company
Financial Information as required under Item 1115(b)
of Regulation AB to the related Depositor in an
XXXXX-compatible form 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 or
(B) assign the Derivative Agreement as provided below.
3
Section 3. Representations and Warranties and Covenants of the
Counterparty.
(a) The Counterparty represents and warrants to the related
Depositor, as of the date on which information is first
provided to the related Depositor under Section 2(a)(ii),
Section 2(b)(i) or Section 2(b)(ii)(A), that, except as
disclosed in writing the related Depositor prior to such
date:
(i) The Counterparty or the entity that consolidates
the Counterparty is required to file reports
with the Commission pursuant to section 13(a) or
15(d) of the Exchange Act.
(ii) The Counterparty or the entity that consolidates
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).
(iii) The reports filed by the Counterparty, or entity
that consolidates the Counterparty, include (or
properly incorporate by reference) the financial
statements of the Counterparty.
(iv) 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.
(v) If applicable, the financial statements included
in the Company Financial Information present
fairly the consolidated financial position of
the Counterparty (or the entity that
consolidates 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. 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.
(vi) 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
material 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
4
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.
(b) If the Counterparty has provided Company Financial Information
that is incorporated by reference into the Registration
Statement of the related Depositor, the Counterparty, so
long as the related Depositor is required to file Exchange
Act Reports with respect to the SPV, will file promptly all
documents required to be filed with the Commission pursuant
to Section 13 or 14 of the Exchange Act. 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.
(c) 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.
(d) 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.
Section 4. Indemnification; Remedies
(a) 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 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 "Countrywide 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:
(i) (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 Section 2 by or on
behalf of the Counterparty (collectively, the "Company
Information"), or (B) the omission or alleged omission
to state in the Company Information
5
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
(ii) 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.
(b) CHL shall indemnify the Counterparty, each of its officers
and directors and each person who controls the Counterparty
(within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act) (each, a "Counterparty
Indemnified Party"; and each of the Countrywide Indemnified
Party and the Counterparty Indemnified Party shall be
referred to as the "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 any untrue statement or alleged untrue statement
of any material fact contained in the Prospectus Supplement
or any free writing prospectus with respect to the related
Securities or the omission or alleged omission to state a
material fact necessary in order to make the statements
therein not misleading; provided, however, that the
indemnity set forth in this Section 4(b) shall not apply
insofar as such losses, claims, expenses, damages or
liabilities (or actions in respect thereof) arise out of or
are based upon (i) any untrue statement or alleged untrue
statement of any material fact contained in the Company
Information or the omission or alleged omission to state in
the Company Information a material fact necessary in order
to make the statements therein not misleading and/or (ii) a
breach of the representations set forth in Sections 3(a)
above.
(c) Promptly after the Indemnified Party receives notice of the
commencement of any such action, the Indemnified Party will,
if a claim in respect thereof is to be made pursuant to this
Agreement, promptly notify the indemnifying party in writing
of the commencement thereof. In case any such action is
brought against the Indemnified Party, and it notifies the
indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to appoint counsel of
the indemnifying party's choice at the indemnifying party's
expense to represent the Indemnified Party in any action for
which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for
the fees and expenses of any separate counsel retained by
the Indemnified Party except as set forth below); provided,
however, that such counsel shall be reasonably satisfactory
to the Indemnified Party. Notwithstanding the indemnifying
party's election to appoint counsel to represent the
Indemnified Party in an action, the Indemnified Party shall
have the right to employ separate counsel (including local
counsel), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel
if (i) the use of counsel chosen by the indemnifying party
to represent the Indemnified Party would present such
counsel
6
with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action
include both the Indemnified Party and the indemnifying
party, and the Indemnified Party shall have reasonably
concluded that there may be legal defenses available to it
that are different from or additional to those available to
the indemnifying party, (iii) the indemnifying party shall
not have employed counsel reasonably satisfactory to the
Indemnified Party to represent the Indemnified Party within
a reasonable time after notice of the institution of such
action or (iv) the indemnifying party shall authorize the
Indemnified Party to employ separate counsel at the expense
of the indemnifying party. The indemnifying party will not,
without the prior written consent of the Indemnified Party,
settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the
Indemnified Party is an actual or potential party to such
claim or action) unless such settlement, compromise or
consent includes an unconditional release of each
Indemnified Party from all liability arising out of such
claim, action, suit or proceeding. In addition, for so long
as the indemnifying party is covering all costs and expenses
of the Indemnified Party as provided herein, no Indemnified
Party will settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder
without the consent of the indemnifying party, which consent
shall not be unreasonably withheld.
(d) Nothing in this agreement shall be construed to allow the
Indemnified Party to recover punitive damages or
consequential damages from the indemnifying party.
(e) (i) Any failure by the Counterparty to deliver any
information, report, accountants' consent or other
material when and in any case only as required under
Section 2 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 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).
(ii) If the Counterparty has failed to deliver any
information, report, or accountants' consent when and
as required under Section 2, which
7
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 provided Company Information any
breach by the Counterparty of a representation or
warranty pursuant to Section 3 to the extent made as
of a date subsequent to such closing date, and the
Counterparty has not, at its own cost, within the
period in which the applicable Exchange Act Report for
which such information is required can be timely filed
caused 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 when and
as required under Section 2 hereof 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, 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).
(iii) In the event that the Counterparty or the SPV has
found a replacement entity in accordance with Section
4(e)(ii) , 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.
Section 5. Miscellaneous.
(a) 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
8
information of such permitted entity provided the
Counterparty has received written confirmation from CHL that
such amendment or interpretive guidance can be relied upon.
(b) 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.
(c) 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.
(d) 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.
(e) 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.
(f) 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.
(g) 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.
(h) 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.
(i) 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.
9
(j) 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.
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.
CWABS, INC.
By:/S/ Xxxxxxx X. Xxxxxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: Managing Director
CWMBS, INC.
By:/S/ Xxxxxxx X. Xxxxxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: Managing Director
CWALT, INC.
By:/S/ Xxxxxxx X. Xxxxxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: Managing Director
CWHEQ, INC.
By:/S/ Xxxxxxx X. Xxxxxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: Managing Director
COUNTRYWIDE HOME LOANS, INC.
By:/S/ Xxxxxxx X. Xxxxxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxxxxx
Title: Managing Director
11
BANK OF AMERICA, N.A.
By:/S/ Xxxxx X. Pagusk
----------------------------
Name: Xxxxx X. Pagusk
Title: Senior Vice President
12
