EXHIBIT 99.3
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The 1115 Agreement
Item 1115 Agreement dated as of June 12, 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 Bear Xxxxxxx Financial Products Inc.,
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 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 of the registrant.
GAAP: As defined in Section 3(a)(ii).
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.
Free Writing Prospectus: The free writing prospectus prepared
in connection with the public offering and sale of the related Securities.
Master Agreement: 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 Free Writing Prospectus and
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;
(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);
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(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, the Counterparty
shall:
(A) provide the financial data required by
Item Ill5(b)(1) or (bX2) of Regulation AB
(as specified by the related Depositor to
the Counterparty) with respect to the
Counterparty (er any entity that
consolidates the Counterparty) and any
affiliated entities providing derivative
instruments to the SPV (the "Company
Financial Information"), in a form
appropriate for use in the Free Writing
Prospectus, Prospectus Supplement and in
an XXXXX-compatible form and
(B) if applicable, cause its accountants to issue
their consent to the filing of such financial
statements in the Registration Statement.
(b) Following the Closing Date with respect to a Transaction,
(i) no later than the 25th calendar day of each month, 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) provide to
the related Depositor a description of such
proceedings, affiliations or relatienships as described
in Section 2(b)(i)(1);
(ii) if the Counterparty provided Company Financial
Information to the related Depositor for the Free
Writing Prospectus and/or 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 1 115(b) of Regulation AB to the related Depositor
in an XXXXX-compatible form, 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
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(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), (1) provide
current Company Financial Information as required under
Item 1115(b) of Regulation AB to the related Depositor
in an XXXXX-compatible form, (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 1 115(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.
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) 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.
(ii) 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 of 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.
(iii) 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
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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 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) 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 IndyMac Bank 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, 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 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;
(ii) [reserved]; or
(iii) 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) (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
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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 Free Writing Prospectus and the
Prospectus Supplement, the date of printing of the Free
Writing Prospectus or Prospectus Supplement, as
applicable), 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 such closing
date, 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 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), 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, either (A) 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, or (B) post collateral
satisfactory to Bear Xxxxxxx Financial Products Inc.
and the Depositor in an amount sufficient to reduce the
aggregate significance percentage to 5% in the case
that financials have been requested for the purpose of
compliance with Item 1115(b)(1) and to 15% in the case
that financials have been requested for the purpose of
compliance with Item 1115(b)(2), then an Additional
Termination Event (as defined in the Master Agreement)
shall have occurred with the Counterparty as the sole
Affected Party. 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
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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.
Section 5. Miscellaneous.
(a) 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.
(b) 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.
(c) 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 exeept the
related SPV and any trustee of an SPV or any Administrator.
(d) 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.
(e) 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 eompliance, and shall be effective only in the
specific instance and for the specific purpose stated in that
writing.
(f) 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 eonstitute one and the same
instrument.
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(g) 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 necessary or expedient to
effectuate and carry out this Agreement.
(h) 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.
(i) 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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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
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Name: Xxxx Xxxxxxxx
Title: Senior Vice President
Secondary Marketing
INDYMAC ABS, INC.
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Senior Vice President
Secondary Marketing
INDYMAC BANK, F.S.B.
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Senior Vice President
Secondary Marketing
BEAR XXXXXXX FINANCIAL PRODUCTS INC.
By: /s/ F. Xxxxx Xxxxxx
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Name: F. Xxxxx Xxxxxx
Title: DPC Manager
