Exhibit 99.3
ASSIGNMENT AGREEMENT
ASSIGNMENT AGREEMENT, dated as of March 30, 2006 ("Assignment
Agreement"), among COUNTRYWIDE HOME LOANS, INC. ("Assignor"), JPMORGAN CHASE
BANK, N.A. ("Assignee"), not in its individual capacity but solely in its
capacity as Cap Contract Administrator for CWHEQ Revolving Home Equity Loan
Trust, Series 2006-D, pursuant to a Cap Contract Administration Agreement (the
"Cap Contract Administration Agreement") dated as of March 30, 2006, and
BARCLAYS BANK PLC ("Remaining Party").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, effective as of March 30, 2006 Assignor desires to assign all
of its rights and delegate all of its duties and obligations to Assignee under a
certain Transaction (the "Assigned Transaction") as evidenced by a certain
confirmation with a Trade Date of March 24, 2006 whose BARCLAYS BANK PLC
reference number is 1135258B (the "Confirmation"), a copy of which is attached
hereto as Exhibit I;
WHEREAS, Assignor and Remaining Party executed and delivered the
Confirmation in connection with an ISDA Master Agreement (Multicurrency--Cross
Border) form (the "ISDA Form Master Agreement");
WHEREAS, Assignee desires to accept the assignment of rights and assume
the delegation of duties and obligations of the Assignor under the Assigned
Transaction and the Confirmation, including any modifications that may be agreed
to by Assignee and Remaining Party; and
WHEREAS, Assignor desires to obtain the written consent of Remaining
Party to the assignment, delegation, and assumption and Remaining Party desires
to grant such consent in accordance with the terms hereof;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained and for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties agree as follows:
1. Assignment and Assumption. Effective as of and from March 30, 2006
(the "Effective Date"), Assignor hereby assigns all of its rights and delegates
all of its duties and obligations to Assignee and Assignee hereby assumes all
Assignor's rights, duties, and obligations under the Assigned Transaction and
the Confirmation arising on or after the Effective Date.
2. Release. Effective as of and from the Effective Date, Remaining
Party and Assignor hereby release one another from all duties and obligations
owed under and in respect of the Assigned Transaction and the Confirmation, and
Assignor hereby terminates its rights under and in respect of the Assigned
Transaction; provided, that such release shall not affect Assignor's obligation
to pay the Fixed Amount in accordance with the terms of the Assigned Transaction
and the Confirmation.
3. Limitation on Liability. Assignor and Remaining Party agree to the
following: (a) JPMorgan Chase Bank, N.A. ("JPMorgan") is entering into this
Assignment Agreement not in its individual capacity but solely in its capacity
as Cap Contract Administrator under the Cap Contract Administration Agreement;
and (b) in no case shall JPMorgan (or any person acting as successor Cap
Contract Administrator under the Cap Contract Administration Agreement) be
personally liable for or on account of any of the statements, representations,
warranties, covenants or obligations stated to be those of Assignee under the
terms of the Assigned Transaction, all such liability, if any, being expressly
waived by Assignor and Remaining Party and any person claiming by, through or
under either such party.
4. Consent and Acknowledgment of Remaining Party. Remaining Party
hereby consents to the assignment and delegation by Assignor to Assignee of all
the rights, duties, and obligations of Assignor under the Assigned Transaction
pursuant to this Assignment Agreement.
5. Governing Agreement. The Assigned Transaction and the Confirmation
shall form a part of, and be subject to, the ISDA Form Master Agreement, as if
Assignee and Remaining Party had executed such agreement on the Effective Date
of the Transaction (the "Assignee Agreement"). The Confirmation, together with
all other documents referring to the ISDA Form Master Agreement confirming
transactions entered into between Assignee and Remaining Party, shall form a
part of, and be subject to, the Assignee Agreement. For the purposes of this
paragraph, capitalized terms used herein and not otherwise defined shall have
the meanings assigned in the ISDA Form Master Agreement.
6. Additional Provision. Each party hereby agrees that the Confirmation
and thus the Assigned Transaction are each hereby amended as follows:
(a) The following additional provision shall be added as a new
Section 8:
"Regulation AB Compliance. Party A and Party B agree that the
terms of the Item 1115 Agreement dated as of February 16, 2006
(the "Regulation AB Agreement"), between Countrywide Home
Loans, Inc., CWABS, INC., CWMBS, Inc., CWALT, Inc., CWHEQ,
Inc. and Barclays Bank PLC shall be incorporated by reference
into this Agreement so that Party B shall be an express third
party beneficiary of the Regulation AB Agreement. A copy of
the Regulation AB Agreement is attached hereto as Annex A."
(b) The Item 1115 Agreement dated as of February 16, 2006,
between Countrywide Home Loans, Inc., CWABS, INC., CWMBS, Inc., CWALT,
Inc., CWHEQ, Inc. and Barclays Bank PLC, a copy of which is attached
hereto as Exhibit II, shall be added as Annex A.
7. Representations. Each party hereby represents and warrants to the
other parties as follows:
(a) It is duly organized, validly existing and in good standing
under the laws of its jurisdiction of organization or
incorporation;
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(b) It has the power to execute and deliver this Assignment
Agreement; and
(c) Its obligations under this Assignment Agreement constitute its
legal, valid and binding obligations, enforceable in
accordance with their respective terms.
As of the Effective Date, each of Assignor and Remaining Party
represents that no event or condition has occurred that constitutes an Event of
Default, a Potential Event of Default or, to the party's knowledge, a
Termination Event (as such terms are defined in the Confirmation and Assignee
Agreement), with respect to the party, and no such event would occur as a result
of the party's entering into or performing its obligations under this Assignment
Agreement.
8. Indemnity. Each of Assignor and Remaining Party hereby agrees to
indemnify and hold harmless Assignee with respect to any and all claims arising
under the Assigned Transaction prior to the Effective Date. Each of Assignee and
Remaining Party (subject to the limitations set forth in paragraph 3 above)
hereby agrees to indemnify and hold harmless Assignor with respect to any and
all claims arising under the Assigned Transaction on or after the Effective
Date.
9. Governing Law. This Assignment Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
10. Notices. For the purposes of this Assignment Agreement and Section
12(a) of the ISDA Form Master Agreement of the Assigned Transaction, the
addresses for notices or communications are as follows: (i) in the case of
Assignor, Countrywide Home Loans, Inc., ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇., with a copy to the same address, Attention:
Legal Department, or such other address as may be hereafter furnished in writing
to Assignee and Remaining Party; (ii) in the case of Assignee, JPMorgan Chase
Bank, N.A., 4 New York Plaza, 6th Floor, New York, New York 10004, Attention:
Worldwide Securities Services/Structure Finance Services, Countrywide HEL CWHEQ
2006-D or such other address as may be hereafter furnished in writing to
Assignor and Remaining Party; and (iii) in the case of Remaining Party, Barclays
Bank PLC, 5 The North Colonade, Canary Wharf, E14 4 BB, such other address as
may be hereafter furnished in writing to Assignor and Assignee.
11. Payments. All payments (if any) remitted by Remaining Party under
the Assigned Transaction shall be made by wire transfer according to the
following instructions:
JPMorgan Chase Bank, N.A. - Houston, TX.
ABA# ▇▇▇▇▇▇▇▇▇
Acct Number: 00103409232
Acct Name: Houston Structured Finance
Ref: CWHEQ 2006-D
12. Counterparts. This Assignment Agreement may be executed and
delivered in counterparts (including by facsimile transmission), each of which
when executed shall be deemed to be an original but all of which taken together
shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Assignment Agreement
as of the date first above written.
COUNTRYWIDE HOME LOANS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇.
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Title: Senior Vice President
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JPMORGAN CHASE BANK, N.A., AS CAP CONTRACT
ADMINISTRATOR FOR CWHEQ REVOLVING HOME EQUITY
LOAN TRUST, SERIES 2006-D
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Title: Attorney-In-Fact
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BARCLAYS BANK PLC
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------------
Title: Authorised Signatory
------------------------------------------
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EXHIBIT I
[LOGO OF 5 The North Colonnade
BARCLAYS CAPITAL] ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Tel ▇▇▇ (▇)▇▇ ▇▇▇▇ ▇▇▇▇
To: COUNTRYWIDE HOME LOANS, INC. (the "Counterparty")
Attn: ▇▇▇▇ ▇▇▇▇▇▇
Fax No: ▇-▇▇▇-▇▇▇▇▇▇▇
From: BARCLAYS BANK PLC (LONDON HEAD OFFICE) ("Barclays")
Date: March 23, 2006
Reference: 1135258B
Rate Cap Transaction Confirmation
The purpose of this facsimile (this "Confirmation") is to confirm the terms and
conditions of the Transaction entered into between us on the Trade Date
specified below (the "Transaction").
The definitions and provisions contained in the 2000 ISDA Definitions (the "2000
Definitions"), as published by the International Swaps and Derivatives
Association, Inc. ("ISDA") are incorporated into this Confirmation. In the event
of any inconsistency between the 2000 Definitions and this Confirmation, this
Confirmation will govern for the purposes of the Transaction. References herein
to a "Transaction" shall be deemed to be references to a "Swap Transaction" for
the purposes of the 2000 Definitions. Capitalized terms used in this
Confirmation and not defined in this Confirmation or the 2000 Definitions shall
have the respective meaning assigned in the Agreement. Each party hereto agrees
to make payment to the other party hereto in accordance with the provisions of
this Confirmation and of the Agreement. In this Confirmation, "Party A" means
Barclays and "Party B" means the Counterparty.
1. This Confirmation supersedes any previous Confirmation or other
communication with respect to the Transaction and evidences a complete
and binding agreement between you and us as to the terms of the Swap
Transaction to with this Confirmation relates. This Confirmation is
subject to the terms and conditions of the ISDA Master Agreement dated
as of May 17, 1996, between each of Party A and Party B and shall form
a part of and be subject to that ISDA Master Agreement.
Barclays Capital : the investment banking division of Barclays Bank PLC.
Registered in England 1126167.
Registered Office : ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇
▇▇▇. Authorized and registered by the Financial Services Authority and a member
of the London Stock Exchange.
Page 2 of 12
The terms of the particular Transaction to which this Confirmation relates are
as follows:
2. TRADE DETAILS
Notional Amount: With respect to any Calculation Period the amount set
forth for such period in Schedule A attached hereto
Trade Date: March 23, 2006
Effective Date: ▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ Date: October 15, 2011; subject to adjustment in accordance
with the Following Business Day Convention
Fixed Amounts:
Fixed Rate Payer: Counterparty
Fixed Rate Payer Payment Date(s): March 30, 2006; subject to adjustment in accordance
with the following Business Day Convention
Fixed Amount: USD35,000
Floating Amounts: To be determined in accordance with the following
formula:
Greater of (i) (Floating Rate - Strike Rate) x Notional
Amount x Floating Rate Day Count Fraction; and (ii)
zero.
Floating Rate Payer: Barclays.
Strike Rate: Please see Schedule attached hereto
Floating Rate Payer Payment Date(s): For each Calculation Period, the first Business Day
prior to each Floating Rate Payer Period End Date.
Floating Rate Payer Period End Date(s): The 15th of each month in each year from (and
including) May 15, 2006 to (and including) the
Termination Date; subject to adjustment in accordance
with the Following Business Day Convention
Floating Rate Option: USD-LIBOR-BBA
Floating Rate Day Count Fraction: Actual / 360
Designated Maturity: 1 Month.
Reset Dates: The first day of Each Calculation Period.
Business Days: New York.
Governing Law: This Transaction and this Confirmation will be governed
by and construed in
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accordance with the laws of the State of New York
(without reference to choice of law doctrine except
Section 5-1401 and Section 5-1402 of the New York
General Obligation Law).
3. ACCOUNT DETAILS
Payments to Barclays: Correspondent: BARCLAYS BANK PLC NEW YORK
FEED: ▇▇▇▇▇▇▇▇▇
Beneficiary: BARCLAYS SWAPS
Beneficiary Account: ▇▇▇-▇▇▇▇▇-▇
Payments to Counterparty: Beneficiary Account: BANK OF AMERICA NA-SAN FRANCISCO
FFED: ▇▇▇▇▇▇▇▇▇
Beneficiary: COUNTRYWIDE HOME LOANS, INC.
A/C: 12352 06200
4. OFFICES
Barclays: Address for Notices:
▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇ ▇▇
Tel: ▇▇(▇▇) ▇▇▇▇ ▇▇▇▇
Fax: ▇▇(▇▇) ▇▇▇ ▇▇▇▇▇
Counterparty: Address for Notices:
c/o COUNTRYWIDE FUNDING
CORPORATION
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
MAIL STOP WLAR-43
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Tel: ▇(▇▇▇) ▇▇▇-▇▇▇▇
Fax: l (▇▇▇) ▇▇▇▇▇▇▇
5. Left Intentionally Blank.
6. Assignment of the Transaction:
At the option of the Counterparty, upon payment of the Fixed Amount and
satisfaction of any other conditions described herein, on a date in the future,
(the "Transfer Date") Barclays and an entity (the "Transferee") to be designated
by the Counterparty and approved by Barclays will enter into a novation
agreement (substantially in the form of the ISDA Form Novation Agreement
published by the International Swaps and Derivatives Association, Inc., a copy
of which is attached hereto as Annex A, and otherwise acceptable to Barclays)
under which, among other things, the Counterparty will transfer its interest as
the Counterparty to the Transaction under this Confirmation to the Transferee,
and under which the Transferee shall assume the rights and obligations of the
Counterparty to the Transaction under this Confirmation (the "Transfer"). Upon
transfer of this Transaction to the Transferee, all
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references to Party B or the Counterparty or words of similar meaning or import
shall be deemed to be a reference to the Transferee.
As of the date of such Transfer, the Transferee and Barclays will be deemed to
enter into an ISDA Master Agreement in the form of the 1992 ISDA Master
Agreement (Multicurrency -- Cross Border) published by the International Swaps
and Derivatives Association, Inc. (the "Form ISDA Master Agreement") without any
Schedule, except for the elections that are provided in Part 7 of this
Confirmation. As of the date of such Transfer, as between the Transferee and
Barclays, this Confirmation shall be deemed to supplement, form a part of, and
be subject to the Form ISDA Master Agreement (together, the "Transferred
Agreement"). All provisions contained in the Form ISDA Master Agreement shall
govern this Confirmation except as expressly modified herein.
7. Provisions Deemed Incorporated into this Agreement upon Transfer:
As of the date of Transfer, the following provisions i) through vii) will be
deemed to be incorporated into the Transferred Agreement:
i) The parties agree that subparagraph (ii) of Section 2(c) of
the ISDA Form Master Agreement will apply to any Transaction.
ii) Termination Provisions. For purposes of the Transferred
Agreement:
(a) "Specified Entity" means in relation to Party A for
the purpose of the Agreement:
Section 5(a)(v): None;
Section 5(a)(vi): None;
Section 5(a)(vii): None;
Section 5(b)(iv): None;
and in relation to Party B for the purpose of this
Agreement:
Section 5(a)(v): None;
Section 5(a)(vi): None;
Section 5(a)(vii): None;
Section 5(b)(iv): None.
(b) "Specified Transaction" shall be inapplicable to
Party A and Party B.
(c) The "Breach of Agreement" provisions of Section
5(a)(ii) of the Agreement will be inapplicable to
Party A and Party B.
(d) The "Credit Support Default" provisions of Section
5(a)(iii) of the Agreement will be inapplicable to
Party B.
(e) The "Misrepresentation" provisions of Section
5(a)(iv) of the Agreement will be inapplicable to
Party A and Party B.
(f) The "Default Under Specified Transaction" provisions
of Section 5(a)(v) of the Agreement will be
inapplicable to Party A and Party B.
(g) The "Cross Default" provisions of Section 5(a)(vi) of
the Agreement will be inapplicable to Party A and
Party B.
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(h) The "Credit Event Upon Merger" provisions of Section
5(b)(iv) of the Agreement will be inapplicable to
Party A and Party B.
(i) The "Bankruptcy" provision of Section 5(a)(vii)(2)
will not apply to Party B.
(j) The "Automatic Early Termination" provision of
Section 6(a) of the Agreement will be inapplicable to
Party A and Party B.
(k) Payments on Early Termination. For the purpose of
Section 6(e) of the Transferred Agreement:
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(l) "Termination Currency" means United States Dollars.
iii) Tax Representations.
Payer Tax Representations. For the purpose of Section 3(e),
each of Barclays and the Counterparty makes the following
representation:
It is not required by any applicable law, as modified
by the practice of any relevant governmental revenue
authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax
from any payment (other than interest under Section
2(e), 6(d)(ii) and 6(c) of this Agreement) to be made
by it to the other party under this Agreement. In
making this representation, it may rely on: (i) the
accuracy of any representation made by the other
party pursuant to Section 3(f) of this Agreement;
(ii) the satisfaction of the agreement of the other
party contained in Section 4(a)(i) or 4(e)(iii) of
this Agreement and the accuracy and effectiveness of
any document provided by the other party pursuant to
Section 4(a)(i) or 4(a)(iii) of this Agreement; and
(iii) the satisfaction of the agreement of the other
party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this
representation where reliance is placed on clause
(ii) and the other party does not deliver a form or
document under Section 4(a)(iii) by reason of
material prejudice to its legal or commercial
position.
Barclays Payee Tax Representations. For the purpose of Section
3(f), Barclays makes the following representations:
with respect to payments made to Barclays which are
not effectively connected to the U.S.: it is a
non-U.S. branch of a foreign person for U.S. federal
income tax purposes.
With respect to payments made to Barclays which are
effectively connected to the U.S.: Each payment
received or to be received by it in connection with
this Agreement will be effectively connected with its
conduct of a trade or business in the U.S.
Counterparty Payee Tax Representations. For the purpose of
Section 3(f), Counterparty makes the following representation:
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Counterparty represents that it is a "United States
person" as such term is defined is Section
7701(a)(30) of the Internal Revenue Code of 1986, as
amended.
iv) Documents to be Delivered. For the purpose of Section 4(a):
(a) Tax forms, documents or certificates to be delivered
are:
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Party required to deliver document Form/Document/Certificate Date by which to be delivered
---------------------------------------- -------------------------------------- --------------------------------------
Barclays and Counterparty Any document required or reasonably Promptly after the earlier of
requested to allow the other party (i) reasonable demand by either
to make payments under this party or (ii) within 30 days of the
Agreement without any deduction or Transfer Date.
withholding for or on the account of
any Tax or with such deduction or
withholding at a reduced rate.
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(b) Other Documents to be delivered are;
------------------------------- ---------------------------- ---------------------------- ----------------------------
Party required to deliver Form/Document/Certificate Date by which to be Covered by Section 3(d)
document delivered representation
------------------------------- ---------------------------- ---------------------------- ----------------------------
Barclays and the Counterparty Any documents required or Transfer Date Yes
reasonably requested by the
receiving party to evidence
authority of the delivering
party or its Credit Support
Provider, if any, to execute
and deliver this Agreement, any
Confirmation, and any Credit
Support Documents to which it is
a party, and to evidence the
authority of the delivering party
to its Credit Support Provider
to perform its obligations under
this Agreement, such Confirmation
and/or Credit Support Document,
as the case may be.
------------------------------- ---------------------------- ---------------------------- ----------------------------
Barclays and the Counterparty A certificate of an Transfer Date Yes
authorized officer of the
party, as to the
incumbency and authority
of the respective officers
of the party signing this
agreement, any relevant
Credit Support Document,
or any
------------------------------- ---------------------------- ---------------------------- ----------------------------
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------------------------------- ---------------------------- ---------------------------- ----------------------------
Confirmation, as the case
may be.
------------------------------- ---------------------------- ---------------------------- ----------------------------
v) Miscellaneous.
(a) Address for Notices: For the purposes of Section
12(a) of this Agreement:
Address for notices or communications to Barclays:
Address: ▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇
Facsimile: ▇▇(▇▇) ▇▇▇ ▇▇▇▇▇
Phone: ▇▇(▇▇) ▇▇▇ ▇▇▇▇▇
Address for notices or communications to the Counterparty:
To be provided by counterparty.
(b) Process Agent. For the purpose of Section 13(c):
Barclays appoints as its Process Agent: Barclays Bank
PLC, New York Branch.
Counterparty appoints as its Process Agent: Not
Applicable.
(c) Offices. The provisions of Section 10(a) will apply
to this Agreement.
(d) Multibranch party. For the purpose of Section 10(c)
of this Agreement:
Barclays is a Multibranch Party and may act through
its London and New York offices.
Counterparty is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is Barclays;
provided, however, that if an Event of Default occurs
with respect to Barclays, then the Counterparty shall
be entitled to appoint a financial institution which
would qualify as a Reference Market-maker to act as
Calculation Agent.
(f) Credit Support Document. Not applicable for either
Barclays or the Counterparty.
(g) Credit Support Provider.
With respect to Barclays: Not Applicable.
With respect to Counterparty: Not Applicable.
(h) Governing Law. This Agreement shall be governed by,
and construed in accordance with the laws of the
State of New York (without reference to choice of law
doctrine except Section 5-1401 and Section 5-1402 of
the New York General Obligation Law).
Page 8 of 12
(i) Consent to Recording. Each party hereto consents and
agrees the monitoring or recording, at any time and
from time to time, by the other party of any and all
communications between officers or employees of the
parties, waives any further notice of such monitoring
or recording, and agrees to notify its officers and
employees of such monitoring or recording.
(j) Waiver of Jury Trial. To the extent permitted by
applicable law, each party irrevocably waives any and
all right to trial by jury in any legal proceeding in
connection with this Agreement, any Credit Support
Document to which it is a Party, or any Transaction.
Each party also acknowledges that this waiver is a
material inducement to the other party's entering
into this Agreement.
(k) "Affiliate" Counterparty shall be deemed to not have
any Affiliates for purposes of this Agreement.
(l) Severability. If any term, provision, covenant, or
condition of this Agreement, or the application
thereof to any party or circumstance, shall be held
to be invalid or unenforceable (in whole or in part)
for any reason, the remaining terms, provisions,
covenants, and conditions hereof shall continue in
full force and effect as if this Agreement had been
executed with the invalid or unenforceable portion
eliminated, so long as this Agreement as so modified
continues to express, without material change, the
original intentions of the parties as to the subject
matter of this Agreement and the deletion of such
portion of this Agreement will not substantially
impair the respective benefits or expectations of the
parties.
The parties shall endeavor to engage in good faith
negotiations to replace any invalid or unenforceable
term, provision, covenant or condition with a valid
or enforceable term, provision, covenant or
condition, the economic effect of which comes as
close as possibly to that of the invalid or
unenforceable term, provision, covenant or condition.
vi) Additional Representations:
Each party represents to the other party that (absent a
written agreement between the parties that expressly imposes
affirmative obligations to the contrary):-
(a) Non-Reliance. It is acting for its own account, and
it has made its own independent decisions to enter
into the Transaction and as to whether the
Transaction is appropriate or proper based upon its
own judgment and upon advice from such advisers as it
has deemed necessary. It is not relying on any
communication (written or oral) of the other party as
investment advice or as a recommendation to enter
into the Transaction: it being understood that
information and explanations related to the terms and
conditions of the Transaction shall not be considered
investment advice or a recommendation to enter into
the Transaction. No communication (written or oral)
received from the other party shall be deemed to be
an assurance or guarantee as to the expected results
of the Transaction.
(b) Assessment and Understanding. It is capable of
assessing the merits of and understanding (on its own
behalf or through independent professional advice),
and understands and accepts, the terms, conditions
Page 9 of 12
and risks of the Transaction. It is also capable of
assuming, and assumes, the risks of the Transaction.
(c) Status of Parties. The other party is not acting as a
fiduciary for or an adviser to it in respect of the
Transaction.
(d) Purpose. It is entering into the Transaction far the
purposes of hedging its assets or liabilities or in
connection with a line of business.
(e) Eligible Contract Participant Representation. It is
an "eligible contract participant" within the meaning
of Section 1(a)(12) of the Commodity Exchange Act, as
amended, including as amended by the Commodity
Futures Modernization Act of 2000.
vii) Other Provisions.
(a) Fully-Paid Party Protected. Notwithstanding the terms
of Sections 5 and 6 of the Agreement if Party B has
satisfied in full all of its payment obligations
under Section 2(a)(i) of the Agreement, than unless
Party A is required pursuant to appropriate
proceedings to return to Party B or otherwise returns
to Party B upon demand of Party B any portion of such
payment, (a) the occurrence of an event described in
Station 5(a) of the Agreement with respect to Party B
shall not constitute an Event of Default or Potential
Event of Default with respect to Party B as the
Defaulting Party and (b) Party A shall be entitled to
designate an Early Termination Event pursuant to
Section 6 of the Agreement only as a result of a
Termination Event set forth in either Section 5(b)(i)
or Section 5(b)(ii) of the Agreement with respect to
Party A as the Affected Party of Section 5(b)(iii) of
the Agreement with respect to Party A as the Burdened
Party. For purposes of the Transaction to which this
Confirmation relates, Party B's only obligation under
Section 2(a)(i) of the Agreement is to pay the Fixed
Amount on the Fixed Rate Payer Payment Date.
(b) Set-Off. Notwithstanding any provision of this
Agreement or any other existing or future agreement.
each party irrevocably waives any and all rights it
may have to set off, net, recoup or otherwise
withhold or suspend or condition payment or
performance of any obligation between it and the
other party hereunder against any obligation between
it and the other party under any other agreements.
The provisions for Set-Off set forth in Section 6(c)
of the Agreement shall not apply for purposes of this
Transaction.
(c) Proceedings. Party A shall not institute against or
cause any other person to institute against, or join
any other person in instituting against, the Trust,
any bankruptcy, reorganization, arrangement,
insolvency, or liquidation proceedings, or other
proceedings under any federal or state bankruptcy,
dissolution or similar law, for a period of one year
and one day (or, if longer, the applicable preference
period) following indefeasible payment in full of the
Certificates.
Page 10 of 12
The time of dealing will be confirmed by Barclays upon written request. Barclays
is regulated by the Financial Services Authority. Barclays is acting for its own
account in respect of this Transaction.
Please confirm that the foregoing correctly sets forth all the terms and
conditions of our agreement with respect to the Transaction by responding within
three (3) Business Days by promptly signing in the space provided below and both
(i) faxing the signed copy to Incoming Transaction Documentation, Barclays
Capital Global OTC Transaction Documentation & Management, Global Operations,
Fax ▇(▇▇) ▇▇-▇▇▇▇-▇▇▇▇/6857, Tel ▇(▇▇) ▇▇-▇▇▇▇-▇▇▇▇/6904/6965, and (ii) mailing
the signed copy to Barclays Bank PLC, 5 ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇, Attention of Incoming Transaction Documentation, Barclays
Capital Global OTC Transaction Documentation & Management, Global Operation.
Your failure to respond within such period shall not affect the validity or
enforceability of the Transaction against you. This facsimile shall be the only
documentation in respect of the Transaction and accordingly no hard copy
versions of this Confirmation for this Transaction shall be provided unless the
Counterparty requests.
------------------------------------------------------------- ------------------------------------------------------
For and on behalf of For and on behalf of
BARCLAYS BANK PLC COUNTRYWIDE HOMELOANS, INC.
------------------------------------------------------------- ------------------------------------------------------
------------------------------------------------------------- ------------------------------------------------------
Name: Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: ▇▇▇▇▇ ▇▇▇▇▇ Title: Managing Director and Assistant
Date: Authorised Signatory Treasurer
Date:
------------------------------------------------------------- ------------------------------------------------------
Barclays Bank PLC and its Affiliates, including Barclays Capital Inc., may share
with each other information, including non-public credit information, concerning
its clients and prospective clients. If you do not want such information to be
shared, you must write to the Director of Compliance, Barclays Bank PLC, ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇.
Page 11 of 12
Schedule A to the Confirmation dated as of March 23, 2006
Re: Reference Number 1135258B
PERIOD PERIOD NOTIONAL STRIKE
START DATE END DATE (in USD) RATE
30-Mar-06 15-May-06 1,325,000,000 7.45782%
15-May-06 15-Jun-06 1,281,362,634 16.01892%
15-Jun-06 15-Jul-06 1,239,162,416 16.55955%
15-Jul-06 15-Aug-06 1,198,352,014 16.01892%
15-Aug-06 15-Sep-06 1,158,885,656 16.01892%
15-Sep-06 15-Oct-06 1,120,719,078 16.55955%
15-Oct-06 15-Nov-06 1,083,809,472 16.01892%
15-Nov-06 15-Dec-06 1,045,282,928 16.55955%
15-Dec-06 15-Jan-07 1,007,888,132 16.01892%
15-Jan-07 15-Feb-07 973,590,294 16.01892%
15-Feb-07 15 Mar-07 941,308,020 17.75666%
15-Mar-07 15-Apr-07 910,088,926 16.01892%
15-Apr-07 15-May-07 879,897,998 16.05955%
15-May-07 15-Jun-07 850,701,373 15.53510%
15-Jun-07 15-Jul-07 522,466,306 16.05966%
15-Jul-07 15-Aug-07 795,161,129 15.53520%
15-Aug-07 15-Sep-07 768,755,216 15.53526%
15-Sep-07 15-Oct-07 743,216,952 16.05982%
15-Oct-07 15-Nov-07 718,523,696 15.53537%
15-Nov-07 15-Dec-07 694,641,750 16.05994%
15-Dec-07 15-Jan-08 671,546,329 15.53548%
15-Jan-08 15-Feb-08 649,211,529 15.53554%
15-Feb-08 15-Mar-08 627,612,300 16.62081%
15-Mar-08 15-Apr-08 606,724,418 15.53566%
15-Apr-08 15-May-08 586,524,454 16.06024%
15-May-08 15-Jun-08 566,989,752 15.53578%
15-Jun-08 15-Jul-08 548,098,404 16.06037%
15-Jul-08 15-Aug-08 529,829,221 15.53591%
15-Aug-08 15-Sep-08 512,161,712 15.53598%
15-Sep-08 15-Oct-08 495,076,063 16.06058%
15-Oct-08 15-Nov-08 478,553,110 15.53611%
15-Nov-08 15-Dec-08 462,674,322 16.06072%
15-Dec-08 15-Jan-09 447,121,777 15.53626%
15-Jan-09 15-Feb-09 432,178,144 15.53633%
15-Feb-09 15-Mar-09 417,726,663 17.22245%
15-Mar-09 15-Apr-09 403,751,124 15.53648%
15-Apr-09 15-May-09 390,235,854 16.06111%
15-May-09 15-Jun-09 377,165,694 15.53663%
15-Jun-09 15-Jul-09 364,525,985 16.06127%
15-Jul-09 15-Aug-09 352,302,550 15.53680%
15-Aug-09 15-Sep-09 340,481,680 15.53688%
Page 12 of 12
15-Sep-09 15-Oct-09 329,050,117 16.06153%
15-Oct-09 15-Nov-09 317,995,040 15.53705%
15-Nov-09 15-Dec-09 307,304,049 16.06171%
15-Dec-09 15-Jan-10 296,965,153 15.53723%
15-Jan-10 15-Feb-10 286,966,758 15.53732%
15-Feb-10 15-Mar-10 277,297,648 17.22356%
15-Mar-10 15-Apr-10 267,946,979 15.53751%
15-Apr-10 15-May-10 258,904,264 16.06219%
15-May-10 15-Jun-10 250,159,360 15.53770%
15-Jun-10 15-Jul-10 241,702,460 16.06240%
15-Jul-10 15-Aug-10 233,524,078 15.53790%
15-Aug-10 15-Sep-10 225,615,041 15.53801%
15-Sep-10 15-Oct-10 217,966,480 16.06272%
15-Oct-10 15-Nov-10 210,569,816 15.33822%
15-Nov-10 l5-Dec-10 203,116,752 16.06294%
15-Dec-10 15-Jan-11 196,499,266 15.53845%
15-Jan-11 15-Feb-11 189,809,600 15.53856%
15-Feb-11 15-Mar-11 183,340,250 17.22496%
15-Mar-11 15-Apr-1l 177,083,961 15.53880%
15-Apr-11 15-May-11 171,033,116 16.06355%
15-May-11 15-Jun-11 163,629,705 15.53908%
15-Jun-11 15-Jul-11 156,534,260 16.06388%
15-Jul-11 15-Aug-11 149,734,521 15.53941%
15-Aug-11 15-Sep-11 141,218,164 15.53959%
15-Sep- 11 15-Oct-11 136,973,380 16.06443%
* All dates subject to adjustment in accordance with Following Business Day
Convention
EXHIBIT II
Item 1115 Agreement dated as of February 16, 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 BARCLAYS BANK PLC, 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).
▇▇▇▇▇: 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 CHL, 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
relationship between the Counterparty and
any of the following parties:
(1) CHL (or any other sponsor
identified to the Counterparty by
CHL);
(2) the related Depositor (as
identified to the Counterparty by
CHL);
2
(3) the SPV;
(4) Countrywide Home Loans Servicing LP
(or any other servicer or master
servicer identified to the
Counterparty by CHL);
(5) The Bank of New York (or any other
trustee identified to the
Counterparty by CHL);
(6) any originator identified to the
Counterparty by CHL;
(7) any enhancement or support provider
identified to the Counterparty by
CHL; and
(8) any other material transaction
party identified to the
Counterparty by CHL.
(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
1115(b)(1) or (b)(2) of Regulation AB (as
specified by the related Depositor to the
Counterparty) with respect to the
Counterparty (or 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 Prospectus
Supplement and in an ▇▇▇▇▇-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,
(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)(E) (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
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)
3
provide current Company Financial Information as
required under Item 1115(b) of Regulation AB to the
related Depositor in an ▇▇▇▇▇-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
(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 ▇▇▇▇▇-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
▇▇▇▇▇-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 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.
4
(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
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 1934 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 ▇▇▇▇▇-compatible format no
later than the 25th calendar day of the month in which any of
the representations or warranties in Section 3(a)(i) through
(iii) ceased to be correct.
5
(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 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 (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
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) any failure by the Counterparty to deliver any
information, certification, accountants' consent or
other material or to assign the Derivative Agreement
when and as required under Section 2; 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.
In the case of any failure of performance described in clause
(a)(ii) of this Section, the Counterparty shall promptly
reimburse the related Depositor and each Person responsible
for execution of a certification pursuant to Rule 13a-14(d) or
Rule 15d-14(d) under the Exchange Act with respect to the SPV,
for all costs reasonably incurred by each such party in order
to obtain the information, report, certification, accountants'
consent or other material not delivered as required by the
Counterparty.
(b) The Depositor shall indemnify the Counterparty, each of its
officers and directors and each person who controls the
Counterparty (within the meaning of Section 15
6
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 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
7
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), 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 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
8
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. 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).
(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
Instrument. 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 except the
related SPV and any trustee of an SPV or any Administrator.
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(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 compliance, 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 constitute one and the same
instrument.
(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 reasonably 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.
CWABS, INC.
By:_____________________________
Name:
Title:
CWMBS, INC.
By:_____________________________
Name:
Title:
CWALT, INC.
By:_____________________________
Name:
Title:
CWHEQ, INC.
By:_____________________________
Name:
Title:
COUNTRYWIDE HOME LOANS, INC.
By:_____________________________
Name:
Title:
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BARCLAYS BANK PLC
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
Title: Managing Director
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