INDEMNIFICATION
AND
CONTRIBUTION AGREEMENT
THIS INDEMNIFICATION AND CONTRIBUTION AGREEMENT dated June 26, 2003
(the "Agreement") among Xxxxxx Xxxxxxx ABS Capital I Inc., a Delaware
corporation (the "Depositor"), Xxxxxx Xxxxxxx & Co. Incorporated, a Delaware
corporation, as representative (the "Representative"), Xxxxxx Xxxxxxx Mortgage
Capital Inc., a Delaware corporation (the "Seller"), and Countrywide Home Loans,
Inc., a New York corporation ("CHL"), and the parent of Countrywide Home Loans
Servicing LP, a Texas limited partnership (the "Servicing LP").
W I T N E S S E T H:
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WHEREAS, the Servicing LP and the Depositor are parties to the
Countrywide Servicing Agreement (as defined herein);
WHEREAS, the Representative, on behalf of itself and the other
underwriters named in the Underwriting Agreement dated June 26, 2003 between the
Depositor and the Representative (the "Underwriting Agreement"), is agreeing,
subject to the terms and conditions therein, that the Underwriters purchase on
the Closing Date described therein the Offered Certificates (the "Offered
Certificates") as described therein;
WHEREAS, the Servicing LP stands to receive substantial financial
benefits in its capacity as servicer under the Countrywide Servicing Agreement;
WHEREAS, as an inducement to the Depositor to enter into the
Countrywide Servicing Agreement and the Underwriters to enter into the
Underwriting Agreement, CHL wishes to provide for indemnification and
contribution on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing and of other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS
1.1 Certain Defined Terms.
The following terms shall have the meanings set forth below, unless the
context clearly indicates otherwise:
1933 Act: The Securities Act of 1933, as amended.
Agreement: This Indemnification and Contribution Agreement, as the same
may be amended in accordance with the terms hereof.
Countrywide Information: All information in the Prospectus Supplement
contained under the headings "Countrywide Underwriting Standards" and "The
Servicers--Countrywide Home Loans Servicing LP".
Countrywide Servicing Agreement: The Countrywide Servicing Agreement,
dated as of June 1, 2003, among the Depositor, Servicing LP and Xxxxx Fargo Bank
Minnesota, National Association, as trustee.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Offered Certificates: Xxxxxx Xxxxxxx ABS Capital I Inc., Series
2003-SD1, Mortgage Pass-Through Certificates, Class X-0, Xxxxx X-0, Class M-1,
Class M-2, Class B-1 and Class B-2 issued pursuant to the Pooling Agreement.
Person: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Pooling Agreement: The Pooling Agreement, dated as of June 1, 2003,
among the Depositor, the Seller, The Murrayhill Company, as master reporting
agent, Deutsche Bank National Trust Company, as custodian, and Xxxxx Fargo Bank
Minnesota, National Association, as trustee.
Prospectus Supplement: The prospectus supplement dated June 26, 2003,
relating to the public offering of the Offered Certificates.
1.2 Other Terms.
Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Countrywide Servicing Agreement.
ARTICLE II.
REPRESENTATIONS AND WARRANTIES
Each party hereto represents that:
(a) it has all requisite power and authority to execute, deliver
and perform its obligations under this Agreement;
(b) this Agreement has been duly authorized, executed and
delivered by such party; and
(c) assuming the due authorization, execution and delivery by each
other party hereto, this Agreement constitutes the legal, valid and binding
obligation of such party.
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ARTICLE III.
INDEMNIFICATION
3.1 Indemnification by CHL.
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(a) CHL shall indemnify and hold harmless the Depositor, the Seller and
each Underwriter and their respective directors, officers and each Person, if
any, that controls the Depositor, the Seller or any Underwriter, within the
meaning of either the 1933 Act or the Exchange Act, against any and all losses,
claims, damages or liabilities to which the Depositor, the Seller and each
Underwriter or any such director, officer or controlling Person may become
subject, under the 1933 Act, the Exchange Act or otherwise, to the extent that
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in the Prospectus Supplement or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading, to the extent that such untrue statement or
alleged untrue statement or omission or alleged omission relates to information
set forth in the Countrywide Information in the Prospectus Supplement and CHL
shall in each case reimburse the Depositor, the Seller and each Underwriter, and
each such director, officer or controlling Person for any legal or other
expenses reasonably incurred by the Depositor, the Seller and each Underwriter
and each such director, officer or controlling Person, in connection with
investigating or defending any such loss, claim, damage, liability or action.
CHL's liability under this Section 3.1 shall be in addition to any other
liability that CHL may otherwise have.
(b) If the indemnification provided for in this Section 3.1 shall for
any reason be unavailable to an indemnified party under this Section 3.1, then
the party which would otherwise be obligated to indemnify with respect thereto,
on the one hand, and the parties which would otherwise be entitled to be
indemnified, on the other, shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated herein and
incurred by the parties hereto in such proportions that are appropriate to
reflect the relative benefit to the Depositor, the Seller, each Underwriter and
CHL from the issuance and sale of the Offered Certificates or, if such
allocation is not permitted by a court of competent jurisdiction, then on a
basis appropriate to also recognize the relative fault of the Depositor, the
Seller, each Underwriter and CHL in connection with the applicable misstatements
or omissions as well as any other relevant equitable considerations; provided,
that any calculation of the benefits to CHL from the issuance and sale of the
Offered Certificates or any determination of the relative fault of CHL in
connection with misstatements or omissions or other equitable considerations, in
each case in connection with the allocation described in this clause (b), shall
be increased as necessary so as to reflect the combined benefits or fault,
respectively, of both CHL and Servicing LP. Notwithstanding the foregoing, no
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 0000 Xxx) shall be entitled to contribution from any Person that
was not guilty of such fraudulent misrepresentation. For purposes of this
Section 3.1, each director of a party to this Agreement and each Person, if any,
that controls a party to this Agreement within the meaning of Section 15 of the
1933 Act shall have the same rights to contribution as such party.
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3.2 Notification; Procedural Matters.
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Promptly after receipt by an indemnified party under Section 3.1 hereof
of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against CHL (or if a claim for
contribution is to be made against another party) under Section 3.1 hereof,
notify CHL (or other contributing party) in writing of the commencement thereof;
but the omission so to notify CHL (or other contributing party) shall not
relieve it from any liability it may have to any indemnified party (or to the
party requesting contribution) otherwise than under Section 3.1 hereof. In case
any such action is brought against any indemnified party and it notifies CHL of
the commencement thereof, CHL shall be entitled to participate therein and, to
the extent that, by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party, CHL elects to
assume the defense thereof, it may participate with counsel reasonably
satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party and CHL and the
indemnified party or parties shall reasonably have concluded that there may be
legal defenses available to it or them and/or other indemnified parties that are
different from or additional to those available to CHL, the indemnified party or
parties shall have the right to select separate counsel to assert such legal
defenses and to otherwise participate in the defense of such action on behalf of
such indemnified party or parties. Upon receipt of notice from CHL to such
indemnified party of its election so to assume the defense of such action and
approval by the indemnified party of such counsel, CHL shall not be liable to
such indemnified party under this paragraph for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof, unless (i) the indemnified party shall have employed separate counsel
(plus any local counsel) in connection with the assertion of legal defenses in
accordance with the proviso to the immediately preceding sentence, (ii) CHL
shall not have employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) CHL shall have authorized the employment of
counsel for the indemnified party at the expense of CHL. No party shall be
liable for contribution with respect to any action or claim settled without its
consent, which shall not be unreasonably withheld. In no event shall CHL be
liable for the fees and expenses of more than one counsel (in addition to any
local counsel) separate from its own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
ARTICLE IV.
GENERAL
4.1 Survival.
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This Agreement and the obligations of the parties hereunder shall
survive the purchase and sale of the Offered Certificates.
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4.2 Successors.
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This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers, directors and
controlling Persons referred to in Article III hereof and their respective
successors and assigns, and no other Person shall have any right or obligation
hereunder.
4.3 Applicable Law.
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This Agreement and all matters arising with respect to it shall be
governed by and construed in accordance with the laws of the State of New York
(including, without limitation, sections 5-1401 and 5-1402 of the General
Obligations Law of the State of New York) without otherwise giving effect to
conflict of laws principles thereof.
4.4 Miscellaneous.
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Neither this Agreement nor any term hereof may be changed, waived,
discharged or terminated except by a writing signed by the party against which
enforcement of such change, waiver, discharge or termination is sought. This
Agreement may be signed in any number of counterparts, each of which shall be
deemed an original, which taken together shall constitute one and the same
instrument.
4.5 Notices.
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All communications hereunder shall be in writing and shall be deemed to
have been duly given when delivered to (a) in the case of the Depositor, Xxxxxx
Xxxxxxx ABS Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Xxxxxxxx Xxxxx, (b) in the case of the Underwriters, Xxxxxx Xxxxxxx & Co.
Incorporated, as representative, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxxx Xxxxx, (c) in the case of the Seller, Xxxxxx Xxxxxxx
Mortgage Capital Inc., 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxx, Esq., and (d) in the case of CHL, Countrywide Home
Loans, Inc., 0000 Xxxx Xxxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000, Facsimile Number:
(000) 000-0000, Attention: Xxxxx Xxxxxxx.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers as of the date first above written.
XXXXXX XXXXXXX ABS CAPITAL I INC.,
as Depositor
By: /s/ Xxxxxxx X. Xxx
----------------------------------------
Name:
Title:
XXXXXX XXXXXXX & CO. INCORPORATED,
as Representative
By: /s/ [Authorized Representative]
----------------------------------------
Name:
Title:
XXXXXX XXXXXXX MORTGAGE CAPITAL INC.,
as Seller
By: /s/ Xxxxxxx X. Xxx
---------------------------------------
Name:
Title:
COUNTRYWIDE HOME LOANS, INC.,
By: /s/ [Authorized Representative]
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Name:
Title:
[Signature Page to the Countrywide Servicer Indemnification Agreement]
