efc7-1363_ex993.htm

EX-99.3 4 efc7-1363_ex993.htm EXHIBIT 99.3 efc7-1363_ex993.htm

EXHIBIT 99.3

The Bear Confirmation

BEAR STEARNS

BEAR STEARNS FINANCIAL PRODUCTS INC.

383 MADISON AVENUE

NEW YORK, NEW YORK 10179

212-272-4009

DATE:

February 26, 2007

TO:

Countrywide Home Loans, Inc.

ATTENTION:

Mr. Jeff Staab

TELEPHONE:

1-818-225-3279

FACSIMILE:

1-818-225-4010 FAX: 1-818-225-4038

FROM:

Derivatives Documentation

TELEPHONE:

212-272-2711

FACSIMILE:

212-272-9857

SUBJECT:

Fixed Income Derivatives Confirmation and Agreement

REFERENCE NUMBER:

FXNEC9158 – Amended

This Confirmation and Agreement is amended as of February 26, 2007 and supersedes all previous Confirmations and Agreements regarding this Transaction.

The purpose of this letter agreement (“Agreement”) is to confirm the terms and conditions of the Transaction entered into on the Trade Date specified below (the “Transaction”) between Bear Stearns Financial Products Inc. ("BSFP") and Countrywide Home Loans, Inc., ("Counterparty"). This Agreement, which evidences a complete and binding agreement between BSFP and Counterparty to enter into the Transaction on the terms set forth below, constitutes a "Confirmation" as referred to in the "ISDA Form Master Agreement" (as defined below), as well as a “Schedule” as referred to in the ISDA Form Master Agreement.

This Agreement is subject to and incorporates the 2000 ISDA Definitions (the “Definitions”), as published by the International Swaps and Derivatives Association, Inc. (“ISDA”). BSFP and Counterparty have agreed to enter into this Agreement in lieu of negotiating a Schedule to the 1992 ISDA Master Agreement (Multicurrency—Cross Border) form (the "ISDA Form Master Agreement"). An ISDA Form Master Agreement shall be deemed to have been executed by BSFP and Counterparty on the date we entered into the Transaction. All provisions contained in, or incorporated by reference to, the ISDA Form Master Agreement shall govern the Transaction referenced in this Confirmation except as expressly modified herein. In the event of any inconsistency between the provisions of this Agreement and the Definitions or the ISDA Form Master Agreement, this Agreement shall prevail for purposes of the Transaction.

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 2 of 12

2.	The terms of the particular Transaction to which this Confirmation relates are as follows:

Type of Transaction:

Rate Cap

Notional Amount:

With respect to any Calculation Period, the amount set forth for such period in the Schedule of Notional Amounts attached hereto.

Trade Date:

February 1, 2007

Effective Date:

February 28, 2007

Termination Date:

^July 25, 2012

Fixed Amount (Premium):

Fixed Rate Payer:

Counterparty

Fixed Rate Payer

Payment Date:

February 5, 2007

Fixed Amount:

USD 26,500

Floating Amounts:

Floating Rate Payer:

BSFP

Cap Rate:

5.80000%

Floating Rate Payer

Period End Dates:

The 25th calendar day of each month during the Term of this Transaction, commencing March 25, 2007 and ending on the Termination Date, with No Adjustment.

Floating Rate Payer

Payment Dates:

Early Payment shall be applicable. One Business Day preceding each Floating Rate Payer Period End Date.

Floating Rate Option:

USD-LIBOR-BBA, provided, however, that if the Floating Rate determined from such Floating Rate Option for any Calculation Period is greater than 9.30000% then the Floating Rate for such Calculation Period shall be deemed to be 9.30000%.

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 3 of 12

Designated Maturity:

One month

Floating Rate Day

Count Fraction:

30/360

Reset Dates:

The first day of each Calculation Period.

Compounding:

Inapplicable

Business Days for payments:

New York

Business Day Convention:

Modified Following

Additional Amount:

In connection with amending this Transaction USD 1,000 is payable by BSFP to Counterparty on February 28, 2007.

Additional Provisions:

Each party hereto is hereby advised and acknowledges that the other party has engaged in (or refrained from engaging in) substantial financial transactions and has taken (or refrained from taking) other material actions in reliance upon the entry by the parties into the Transaction being entered into on the terms and conditions set forth herein and in the Confirmation relating to such Transaction, as applicable. This paragraph shall be deemed repeated on the trade date of each Transaction.

4.	Provisions Deemed Incorporated in a Schedule to the ISDA Form Master Agreement:

1)	The parties agree that subparagraph (ii) of Section 2(c) of the ISDA Form Master Agreement will apply to any Transaction.

2)	Termination Provisions. For purposes of the ISDA Form Master Agreement:

(a) "Specified Entity" is not applicable to BSFP or Counterparty for any purpose.

(b) "Specified Transaction" is not applicable to BSFP or Counterparty for any purpose, and, accordingly, Section 5(a)(v) of the ISDA Form Master Agreement shall not apply to BSFP or Counterparty.

(c) The "Cross Default" provisions of Section 5(a)(vi) of the ISDA Form Master Agreement will not apply to BSFP or to Counterparty.

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 4 of 12

(d) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) of the ISDA Form Master Agreement will not apply to BSFP or to Counterparty.

(e) The "Automatic Early Termination" provision of Section 6(a) of the ISDA Form Master Agreement will not apply to BSFP or to Counterparty.

(f) Payments on Early Termination. For the purpose of Section 6(e) of the ISDA Form Master Agreement:

(i)

Market Quotation will apply.

(ii)

The Second Method will apply.

(g) "Termination Currency" means United States Dollars.

3)	Tax Representations. Not applicable

Limitation on Events of Default. Notwithstanding the terms of Sections 5 and 6 of the ISDA Form Master Agreement, if at any time and so long as the Counterparty has satisfied in full all its payment obligations under Section 2(a)(i) of the ISDA Form Master Agreement and has at the time no future payment obligations, whether absolute or contingent, under such Section, then unless BSFP is required pursuant to appropriate proceedings to return to the Counterparty or otherwise returns to the Counterparty upon demand of the Counterparty any portion of any such payment, (a) the occurrence of an event described in Section 5(a) of the ISDA Form Master Agreement with respect to the Counterparty shall not constitute an Event of Default or Potential Event of Default with respect to the Counterparty as Defaulting Party and (b) BSFP shall be entitled to designate an Early Termination Date pursuant to Section 6 of the ISDA Form Master Agreement only as a result of the occurrence of a Termination Event set forth in either Section 5(b)(i) or 5(b)(ii) of the ISDA Form Master Agreement with respect to BSFP as the Affected Party or Section 5(b)(iii) of the ISDA Form Master Agreement with respect to BSFP as the Burdened Party.

5)	Documents to be Delivered. For the purpose of Section 4(a) of the ISDA Form Master Agreement:

(1)	Tax forms, documents, or certificates to be delivered are:

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 5 of 12

Party required to deliver document	Form/Document/ Certificate	Date by which to be delivered
BSFP and the Counterparty	Any document required or reasonably requested to allow the other party to make payments under this Agreement without any deduction or withholding for or on the account of any Tax or with such deduction or withholding at a reduced rate	Promptly after the earlier of (i) reasonable demand by either party or (ii) learning that such form or document is required

(2)	Other documents to be delivered are:

Party required to deliver document	Form/Document/ Certificate	Date by which to be delivered	Covered by Section 3(d) Representation
BSFP and the Counterparty	Any documents required by the receiving party to evidence the authority of the delivering party or its Credit Support Provider, if any, for it 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 or its Credit Support Provider to perform its obligations under this Agreement, such Confirmation and/or Credit Support Document, as the case may be	Upon the execution and delivery of this Agreement and such Confirmation	Yes

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 6 of 12

Party required to deliver document	Form/Document/ Certificate	Date by which to be delivered	Covered by Section 3(d) Representation
BSFP and the Counterparty	A certificate of an 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 Confirmation, as the case may be	Upon the execution and delivery of this Agreement and such Confirmation	Yes

6)	Miscellaneous. Miscellaneous

(a)	Address for Notices: For the purposes of Section 12(a) of the ISDA Form Master Agreement:

Address for notices or communications to BSFP:

Address:

383 Madison Avenue, New York, New York 10179

Attention:

DPC Manager

Facsimile:

(212) 272-5823

with a copy to:

Address:

One Metrotech Center North, Brooklyn, New York 11201

Attention:

Derivative Operations - 7th Floor

Facsimile:

(212) 272-1634

(For all purposes)

Address for notices or communications to the Counterparty:

Address:

4500 Park Granada

Mail Stop CH-143

Calabasas, CA 91302

Attention:

Mr. Jeff Staab

Facsimile:

818-225-3898

Phone:

818-225-3279

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 7 of 12

(b)	Process Agent. For the purpose of Section 13(c) of the ISDA Form Master Agreement:

BSFP appoints as its

Process Agent:

Not Applicable

The Counterparty appoints as its

Process Agent:

Not Applicable

(c)

Offices. The provisions of Section 10(a) of the ISDA Form Master Agreement will not apply to this Agreement; neither BSFP nor the Counterparty have any Offices other than as set forth in the Notices Section and BSFP agrees that, for purposes of Section 6(b) of the ISDA Form Master Agreement, it shall not in future have any Office other than one in the United States.

(d)	Multibranch Party. For the purpose of Section 10(c) of the ISDA Form Master Agreement:

BSFP is not a Multibranch Party.

The Counterparty is not a Multibranch Party.

(e)	Calculation Agent. The Calculation Agent is BSFP; provided, however, that if an Event of Default occurs with respect to BSFP, 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 BSFP or the Counterparty.

(g)	Credit Support Provider.

BSFP: Not Applicable

The Counterparty:

Not Applicable

(h)	Governing Law. The parties to this Agreement hereby agree that the law of the State of New York shall govern their rights and duties in whole.

(i)

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.

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 8 of 12

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 possible to that of the invalid or unenforceable term, provision, covenant or condition.

(j)

Consent to Recording. Each party hereto consents to 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.

(k)	Waiver of Jury Trial. Each party waives any right it may have to a trial by jury in respect of any Proceedings relating to this Agreement or any Credit Support Document.

(l)	BSFP will not unreasonably withhold or delay its consent to an assignment of this Agreement to any other third party.

(m)	Set-off. The provisions for Set-off set forth in Section 6(e) of the ISDA Form Master Agreement shall not apply for purposes of this Transaction.

7)	"Affiliate" will have the meaning specified in Section 14 of the ISDA Form Master Agreement, provided that BSFP shall not be deemed to have any Affiliates for purposes of this Agreement, including for purposes of Section 6(b)(ii).

8)	Section 3 of the ISDA Form Master Agreement is hereby amended by adding at the end thereof the following subsection (g):

"(g) Relationship Between Parties.

Each party represents to the other party on each date when it enters into a Transaction that:--

(1) Nonreliance. It is not relying on any statement or representation of the other party regarding the Transaction (whether written or oral), other than the representations expressly made in this Agreement or the Confirmation in respect of that Transaction.

(2) Evaluation and Understanding.

(i) It has the capacity to evaluate (internally or through independent professional advice) the Transaction and has made its own decision to enter into the Transaction; and

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 9 of 12

(ii) It understands the terms, conditions and risks of the Transaction and is willing and able to accept those terms and conditions and to assume those risks, financially and otherwise.

(3) Purpose. It is entering into the Transaction for the purposes of managing its borrowings or investments, hedging its underlying assets or liabilities or in connection with a line of business.

(4) Principal. It is entering into the Transaction as principal, and not as agent or in any other capacity, fiduciary or otherwise.”

NEITHER THE BEAR STEARNS COMPANIES INC. NOR ANY SUBSIDIARY OR AFFILIATE OF THE BEAR STEARNS COMPANIES INC. OTHER THAN BSFP IS AN OBLIGOR OR A CREDIT SUPPORT PROVIDER ON THIS AGREEMENT.

5.	Account Details and

Settlement Information:

Payments to BSFP:

Citibank, N.A., New York

ABA Number: 021-0000-89, for the account of

Bear, Stearns Securities Corp.

Account Number: 0925-3186, for further credit to

Bear Stearns Financial Products Inc.

Sub-account Number: 102-04654-1-3

Attention: Derivatives Department

Payments to Counterparty:

Please provide

This Agreement may be executed in several counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

Counterparty hereby agrees to check this Confirmation and to confirm that the foregoing correctly sets forth the terms of the Transaction by signing in the space provided below and returning to BSFP a facsimile of the fully-executed Confirmation to 212-272-9857. For inquiries regarding U.S. Transactions, please contact Derivatives Documentation by telephone at 212-272-2711. For all other inquiries please contact Derivatives Documentation by telephone at 353-1-402-6233. Originals will be provided for your execution upon your request.

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 10 of 12

We are very pleased to have executed this Transaction with you and we look forward to completing other transactions with you in the near future.

Very truly yours,

BEAR STEARNS FINANCIAL PRODUCTS INC.

By:	_______________________________

Name:

Title:

Counterparty, acting through its duly authorized signatory, hereby agrees to, accepts and confirms the terms of the foregoing as of the Trade Date.

COUNTRYWIDE HOME LOANS, INC.

By:	_______________________________

As authorized agent or officer for Countrywide Home Loans, Inc.

Name:

Title:

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 11 of 12

SCHEDULE OF NOTIONAL AMOUNTS

		Notional Amount
From and including	To but excluding	(USD)
Effective Date	25-Mar-2007	10,000,000.00
25-Mar-2007	25-Apr-2007	^9,795,643.94
25-Apr-2007	25-May-2007	9,567,856.67
25-May-2007	25-Jun-2007	9,316,872.24
25-Jun-2007	25-Jul-2007	9,042,956.42
25-Jul-2007	25-Aug-2007	8,746,421.52
25-Aug-2007	25-Sep-2007	8,427,595.42
25-Sep-2007	25-Oct-2007	8,258,836.61
25-Oct-2007	25-Nov-2007	8,068,533.67
25-Nov-2007	25-Dec-2007	7,857,104.68
25-Dec-2007	25-Jan-2008	7,625,060.41
25-Jan-2008	25-Feb-2008	7,396,681.29
25-Feb-2008	25-Mar-2008	7,172,095.36
25-Mar-2008	25-Apr-2008	6,951,270.81
25-Apr-2008	25-May-2008	6,734,176.14
25-May-2008	25-Jun-2008	6,520,780.08
25-Jun-2008	25-Jul-2008	6,311,051.66
25-Jul-2008	25-Aug-2008	6,104,960.14
25-Aug-2008	25-Sep-2008	5,902,475.05
25-Sep-2008	25-Oct-2008	5,703,566.19
25-Oct-2008	25-Nov-2008	5,508,203.58
25-Nov-2008	25-Dec-2008	5,316,357.53
25-Dec-2008	25-Jan-2009	5,127,998.58
25-Jan-2009	25-Feb-2009	4,943,097.51
25-Feb-2009	25-Mar-2009	4,761,625.37
25-Mar-2009	25-Apr-2009	4,583,553.44
25-Apr-2009	25-May-2009	4,408,853.24
25-May-2009	25-Jun-2009	4,237,496.53
25-Jun-2009	25-Jul-2009	4,069,455.32
25-Jul-2009	25-Aug-2009	3,904,701.83
25-Aug-2009	25-Sep-2009	3,743,208.55
25-Sep-2009	25-Oct-2009	3,584,948.17

Reference Number: FXNEC9158 - Amended

Countrywide Home Loans, Inc.

February 26, 2007

Page of 12 of 12

25-Oct-2009	25-Nov-2009	3,429,893.63
25-Nov-2009	25-Dec-2009	3,278,018.08
25-Dec-2009	25-Jan-2010	3,129,294.92
25-Jan-2010	25-Feb-2010	2,983,697.75
25-Feb-2010	25-Mar-2010	2,841,200.41
25-Mar-2010	25-Apr-2010	2,701,776.94
25-Apr-2010	25-May-2010	2,565,401.63
25-May-2010	25-Jun-2010	2,432,048.97
25-Jun-2010	25-Jul-2010	2,301,693.65
25-Jul-2010	25-Aug-2010	2,174,310.59
25-Aug-2010	25-Sep-2010	2,049,874.92
25-Sep-2010	25-Oct-2010	1,928,361.99
25-Oct-2010	25-Nov-2010	1,809,747.34
25-Nov-2010	25-Dec-2010	1,694,006.72
25-Dec-2010	25-Jan-2011	1,581,116.08
25-Jan-2011	25-Feb-2011	1,471,051.60
25-Feb-2011	25-Mar-2011	1,363,789.63
25-Mar-2011	25-Apr-2011	1,259,306.73
25-Apr-2011	25-May-2011	1,157,579.65
25-May-2011	25-Jun-2011	1,058,585.37
25-Jun-2011	25-Jul-2011	962,301.01
25-Jul-2011	25-Aug-2011	868,703.93
25-Aug-2011	25-Sep-2011	777,771.66
25-Sep-2011	25-Oct-2011	689,481.92
25-Oct-2011	25-Nov-2011	603,812.62
25-Nov-2011	25-Dec-2011	520,741.87
25-Dec-2011	25-Jan-2012	440,247.93
25-Jan-2012	25-Feb-2012	362,309.28
25-Feb-2012	25-Mar-2012	286,791.42
25-Mar-2012	25-Apr-2012	222,577.35
25-Apr-2012	25-May-2012	160,822.46
25-May-2012	25-Jun-2012	101,505.92
25-Jun-2012	^Termination Date	44,607.07