EXHIBIT 10.3
The 1115 Agreement.
Item 1115 Agreement dated as of June 29, 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 Xxxxxxx Xxxxx Capital Services,
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 either 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.
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.
IFRS: Has the meaning set forth in Section 3(a)(v).
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;
(D) a description of any affiliation or material ownership
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
(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 either 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; and
(B) if applicable, cause its accountants or the accountants of
the Counterparty Guarantor 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, 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) If requested by the related Depositor, then no later than March 1 of
each calendar year, the Counterparty shall (1) notify the related
Depositor in writing of any affiliations or material ownership
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 affiliations or material ownership relationships as described
in Section 2(b)(i)(1);
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(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 as required
under Item 1115(b) of Regulation AB to the related Depositor in an
XXXXX-compatible form, and (2) if applicable, cause its accountants
(or, if applicable, the accountants of any Counterparty Guarantor)
to issue their consent to filing 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), (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 (or,
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 as required under Item
1115(b) of Regulation AB to the related Depositor in an
XXXXX-compatible form and if applicable, cause its accountants (or,
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 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 are independent registered public accountants as
required by the Securities Act.
(ii) If applicable, with respect to the Counterparty or the
Counterparty Guarantor, as applicable, 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
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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 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.
(iii) 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 or the Counterparty Guarantor, as applicable.
(iv) 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) 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 person
who controls any of such parties (within the meaning of Section
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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 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 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 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 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
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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
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.
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(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) 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
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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) 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.
(j) Integration. This Agreement contains the entire understanding of the
parties with respect to the subject matter hereof. There are no
restrictions, agreements,
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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: Vice President
INDYMAC ABS, INC.
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Vice President
INDYMAC BANK, F.S.B.
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Vice President
XXXXXXX XXXXX CAPITAL SERVICES
By: /s/ Xxxxxxxx Xxxxx
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Name: Xxxxxxxx Xxxxx
Title: Authorized Signatory
ACKNOWLEDGED AND AGREED
(solely with respect to Section 4(b)):
XXXXXXX XXXXX & CO., INC.
By: /s/ Xxxxxxxx Xxxxxxxxxxxx
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Name: Xxxxxxxx Xxxxxxxxxxxx
Title: Designated Signatory
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