EXHIBIT 99.8
------------
The Item 1115 Agreement
Item 1115 Agreement dated as of May 24, 2006 (this "Agreement"), between
IndyMac Bank, F.S.B.., a federal savings bank ("IndyMac Bank"), IndyMac MBS,
Inc., a Delaware corporation ("IndyMac MBS"), IndyMac ABS, Inc., a Delaware
corporation ("IndyMac ABS"), and Xxxxxx Brothers Special Financing Inc., a
corporation organized and existing under the laws of the State of Delaware, as
counterparty (the "Counterparty").
RECITALS
WHEREAS, IndyMac MBS and IndyMac ABS 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 or an underwriter or dealer with
respect to the Transaction, enter into certain derivative agreements (each, a
"Derivative Agreement"), including interest rate caps, interest rate swaps 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").
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).
Depositor: Means IndyMac MBS and IndyMac ABS with respect to the
related Registration Statement for which the entity is the registrant.
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 SPV pursuant to the Exchange Act.
GAAP: As defined in Section 3(a)(v).
Master Agreement: The ISDA Master Agreement between the Counterparty
and the 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:
(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;
(D) a description of any affiliation or relationship (as set
forth in Item 1119) between the Counterparty and any of
the following parties:
(1) IndyMac Bank (or any other sponsor identified to the
Counterparty by IndyMac Bank);
(2) the related Depositor (as identified to the
Counterparty by IndyMac Bank);
(3) the SPV;
(4) IndyMac Bank (or any other servicer or master
servicer identified to the Counterparty by IndyMac
Bank);
2
(5) Deutsche Bank National Trust Company (or any other
trustee identified to the Counterparty by IndyMac
Bank);
(6) any originator identified to the Counterparty by
IndyMac Bank;
(7) any enhancement or support provider identified to the
Counterparty by IndyMac Bank; and
(8) any other material transaction party identified to
the Counterparty by IndyMac Bank.
(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:
(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, any affiliated entities providing derivative
instruments to the SPV and any entities guaranteeing the
obligations of the Counterparty or any affiliate entity
providing derivative instruments to the SPV (a
"Counterparty Guarantor") (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 with respect to a Transaction, 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:
(i) no later than March 1 of each calendar year, upon the written
request of the related Depositor (or any authorized delegee),
the Counterparty shall (1) notify the related Depositor in
writing of any affiliations or relationships that develop
following the Closing Date between the Counterparty and any of
the parties specified in Section 2(a)(i)(D) (and any other
parties identified in writing by the related Depositor) and (2)
3
provide to the related Depositor a description of such
affiliations or relationships as described in Section
2(b)(i)(1);
(ii) 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 (including Company Financial Information of any
Counterparty Guarantor) 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 (and, if applicable, the
accountants of any Counterparty Guarantor) to issue their
consent to filing or incorporation by reference of such
financial statements in the Exchange Act Reports of the SPV;
and
(iii) 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) all of the following: (1) provide current Company Financial
Information (including Company Financial Information of any
Counterparty Guarantor) 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 (and, if applicable, the
accountants of any Counterparty Guarantor) 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
(including Company Financial Information of any Counterparty
Guarantor) as required under Item 1115(b) of Regulation AB to
the related Depositor in an XXXXX-compatible form and if
applicable, cause its accountants (and, if applicable, the
accountants of any Counterparty Guarantor) to issue their
consent to filing or incorporation by reference of such
financial statements in the Exchange Act Reports of the SPV;
(B) assign the Derivative Agreement as provided below; or
(C) if permissible under Regulation AB (which determination
shall be made by IndyMac Bank in its sole discretion), deliver
collateral to the SPV under the Credit Support Annex related to
the relevant Master Agreement in type and amount to the extent
necessary, in IndyMac Bank's sole discretion, to assure
compliance with Item 1115 of Regulation AB.
4
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)(ii) or Section
2(b)(iii)(A), that, except as disclosed in writing the related
Depositor prior to such date:
(i) Each of the Counterparty, and, if applicable, any Company
Guarantor is required to file reports with the Commission
pursuant to section 13(a) or 15(d) of the Exchange Act.
(ii) Each of the Counterparty, and, if applicable, any Company
Guarantor 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) Each of the reports filed by the Counterparty and, if
applicable, any Company Guarantor include (or properly
incorporate by reference) the financial statements of the
Counterparty or, if applicable, such Company Guarantor.
(iv) The accountants who certify the financial statements and
supporting schedules included in the Company Financial
Information (including Company Financial Information of any
Counterparty Guarantor) (if applicable) are independent
registered public accountants as required by the Securities
Act.
(v) If applicable, with respect to the Counterparty and each
Counterparty Guarantor, either (I) the financial statements
included in the Company Financial Information present fairly
the consolidated financial position of the Counterparty or such
Counterparty Guarantor, as applicable 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 Counterparty or Counterparty
Guarantor 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 or such
Counterparty Guarantor, as applicable 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
5
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.
(vi) 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.
(vii) 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.
(b) If the Counterparty or a Counterparty Guarantor has provided Company
Financial Information that is incorporated by reference into the
Registration Statement of the related Depositor, the Counterparty or
such Counterparty Guarantor, 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 or the Counterparty Guarantor, as applicable, 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 an
SPV that is a beneficiary of a Derivative Agreement shall be an
express third party beneficiary of this Agreement.
6
Section 4. Indemnification; Remedies
(a) Each of the Counterparty and any Counterparty Guarantor shall
indemnify IndyMac Bank and the related Depositor, each person
responsible for the 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, 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 or any Counterparty Guarantor (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
(ii) any breach by the Counterparty or any Counterparty Guarantor 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 or any Counterparty Guarantor of a representation
or warranty pursuant to Section 3 to the extent made as of a
date subsequent to the Closing Date.
(b) (i) Any failure by the Counterparty or any Counterparty Guarantor
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 or any Counterparty
Guarantor 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
7
for determining the termination payment (notwithstanding
anything in the Derivative Agreement to the contrary).
(ii) If the Counterparty or any Counterparty Guarantor has failed to
deliver any information, report, or accountants' consent 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 provided Company
Information any breach by the Counterparty or any Counterparty
Guarantor 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
IndyMac Bank 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
(as defined in the Master Agreement). 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 2(b)(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.
8
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 information of such permitted entity provided the
Counterparty has received written confirmation from IndyMac Bank
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.
(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) Counterparty Guarantor. The Counterparty shall cause any
Counterparty Guarantor that has not acknowledged and agreed to this
Agreement as of the date first set forth above to subsequently
execute a joinder agreement in the form attached hereto as Exhibit A
acknowledging its rights and obligations under this Agreement.
(e) 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.
(f) 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.
(g) 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
9
waiving compliance, and shall be effective only in the specific
instance and for the specific purpose stated in that writing.
(h) 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.
(i) 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.
(j) 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.
(k) 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.
INDYMAC MBS, INC.
By: /s/ Xxxx Xxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Vice President
INDYMAC ABS, INC.
By: /s/ Xxxx Xxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Vice President
INDYMAC BANK, F.S.B.
By: /s/ Xxxx Xxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxx
Title: Senior Vice President
XXXXXX BROTHERS SPECIAL FINANCING INC.
By: /s/ Xxxxxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxxxxx X. Xxxxxx
Title: Vice President
ACKNOWLEDGED AND AGREED:
XXXXXX BROTHERS HOLDINGS INC.
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Autorized Signatory
11
Exhibit A
Form of Joinder
The undersigned Counterparty Guarantor as defined in that certain 1115
Agreement between IndyMac Bank, F.S.B.., a federal savings bank, IndyMac MBS,
Inc., a Delaware corporation, IndyMac ABS, Inc., a Delaware corporation and
Xxxxxx Brothers Special Financing Inc., a corporation organized and existing
under the laws of the State of Delaware, as counterparty (the "Counterparty"),
dated as of May 24, 2006 (the "1115 Agreement"), has reviewed the 1115
Agreement and acknowledges and agrees to the terms and conditions of such 1115
Agreement with respect to its rights and obligations as a Counterparty
Guarantor thereunder.
XXXXXX BROTHERS HOLDINGS INC.
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Authorized Signatory
12
