EXHIBIT 99.2
(Multicurrency-Cross Border)
ISDA(R)
International Swap Dealers Association, Inc.
MASTER AGREEMENT
dated as of March 30, 2006
XXXXXXX XXXXX MITSUI MARINE and GSAA HOME EQUITY TRUST 2006-5
DERIVATIVE PRODUCTS, L.P.
have entered and/or anticipate entering into one or more transactions (each a
"Transaction") that are or will be governed by this Master Agreement, which
includes the schedule (the "Schedule"), and the documents and other confirming
evidence (each a "Confirmation") exchanged between the parties confirming
those Transactions.
Accordingly, the parties agree as follows:
1. Interpretation
(a) Definitions. The terms defined in Section 14 and in the Schedule will have
the meanings therein specified for the purpose of this Master Agreement.
(b) Inconsistency. In the event of any inconsistency between the provisions of
the Schedule and the other provisions of this Master Agreement, the Schedule
will prevail. In the event of any inconsistency between the provisions of any
Confirmation and this Master Agreement (including the Schedule), such
Confirmation will prevail for the purposes of the relevant Transaction.
(c) Single Agreement. All Transactions are entered into in reliance on the
fact that this Master Agreement and all Confirmations form a single agreement
between the parties (collectively referred to as this "Agreement"), and the
parties would not otherwise enter into any Transactions.
2. Obligations
(a) General Conditions.
(i) Each party will make each payment or delivery specified in each
Confirmation to be made by it, subject to the other provisions of
this Agreement.
(ii) Payments under this Agreement will be made on the due date for
value on that date in the place of the account specified in the
relevant Confirmation or otherwise pursuant to this Agreement, in
freely transferable funds and in the manner customary for payments in
the required currency. Where settlement is by delivery (that is,
other than by
payment), such delivery will be made for receipt on the due date in
the manner customary for the relevant obligation unless otherwise
specified in the relevant Confirmation or elsewhere in this
Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is subject
to (1) the condition precedent that no Event of Default or Potential
Event of Default with respect to the other party has occurred and is
continuing, (2) the condition precedent that no Early Termination
Date in respect of the relevant Transaction has occurred or been
effectively designated and (3) each other applicable condition
precedent specified in this Agreement.
(b) Change of Account. Either party may change its account for receiving a
payment or delivery by giving notice to the other party at least five Local
Business Days prior to the scheduled date for the payment or delivery to which
such change applies unless such other party gives timely notice of a
reasonable objection to such change.
(c) Netting. If on any date amounts would otherwise be payable:
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, then, on such date, each party's obligation to
make payment of any such amount will be automatically satisfied and discharged
and, if the aggregate amount that would otherwise have been payable by one
party exceeds the aggregate amount that would otherwise have been payable by
the other party, replaced by an obligation upon the party by whom the larger
aggregate amount would have been payable to pay to the other party the excess
of the larger aggregate amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net amount
will be determined in respect of all amounts payable on the same date in the
same currency in respect of such Transactions, regardless of whether such
amounts are payable in respect of the same Transaction. The election may be
made in the Schedule or a Confirmation by specifying that subparagraph (ii)
above will not apply to the Transactions identified as being subject to the
election, together with the starting date (in which case subparagraph (ii)
above will not, or will cease to, apply to such Transactions from such date).
This election may be made separately for different groups of Transactions and
will apply separately to each pairing of Offices through which the parties
make and receive payments or deliveries.
(d) Deduction or Withholding for Tax
(i) Gross-Up. All payments under this Agreement will be made without
any deduction or withholding for or on account of any Tax unless such
deduction or withholding is required by any applicable law, as
modified by the practice of any relevant governmental revenue
authority, then in effect. If a party is so required to deduct or
withhold, then that party ("X") will:
(1) promptly notify the other party ("Y") of such
requirement;
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(2) pay to the relevant authorities the full amount required
to be deducted or withheld (including the full amount
required to be deducted or withheld from any additional
amount paid by X to Y under this Section 2(d)) promptly upon
the earlier of determining that such deduction or
withholding is required or receiving notice that such amount
has been assessed against Y;
(3) promptly forward to Y an official receipt (or a
certified copy), or other documentation reasonably
acceptable to Y, evidencing such payment to such
authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in
addition to the payment to which Y is otherwise entitled
under this Agreement, such additional amount as is necessary
to ensure that the net amount actually received by Y (free
and clear of Indemnifiable Taxes, whether assessed against X
or Y) will equal the full amount Y would have received had
no such deduction or withholding been required. However, X
will not be required to pay any additional amount to Y to
the extent that it would not be required to be paid but for:
(A) the failure by Y to comply with or perform any
agreement contained in Section 4(a)(i), 4(a)(iii)
or 4(d); or
(B) the failure of a representation made by Y
pursuant to Section 3(f) to be accurate and true
unless such failure would not have occurred but for
(I) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or
after the date on which a Transaction is entered
into (regardless of whether such action is taken or
brought with respect to a party to this Agreement)
or (II) a Change in Tax Law.
(ii) Liability. If: -
(1) X is required by any applicable law, as modified by the
practice of any relevant governmental revenue authority, to
make any deduction or withholding in respect of which X
would not be required to pay an additional amount to Y under
Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed directly
against X,
then, except to the extent Y has satisfied or then satisfies the
liability resulting from such Tax, Y will promptly pay to X the
amount of such liability (including any related liability for
interest, but including any related liability for penalties only if Y
has failed to comply with or perform any agreement contained in
Section 4(a)(i), 4(a)(iii) or 4(d)).
(e) Default Interest; Other Amounts. Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment
obligation will, to the extent permitted by law and subject to Section 6(c),
be required to pay interest (before as well as after judgment) on the overdue
amount
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to the other party on demand in the same currency as such overdue amount, for
the period from (and including) the original due date for payment to (but
excluding) the date of actual payment, at the Default Rate. Such interest will
be calculated on the basis of daily compounding and the actual number of days
elapsed. If, prior to the occurrence or effective designation of an Early
Termination Date in respect of the relevant Transaction, a party defaults in
the performance of any obligation required to be settled by delivery, it will
compensate the other party on demand if and to the extent provided for in the
relevant Confirmation or elsewhere in this Agreement.
3. Representations
Each party represents to the other party (which representations will be deemed
to be repeated by each party on each date on which a Transaction is entered
into and, in the case of the representations in Section 3(f), at all times
until the termination of this Agreement) that:
(a) Basic Representations.
(i) Status. It is duly organized and validly existing under the laws
of the jurisdiction of its organisation or incorporation and, if
relevant under such laws, in good standing;
(ii) Powers. It has the power to execute this Agreement and any other
documentation relating to this Agreement to which it is a party, to
deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to
perform its obligations under this Agreement and any obligations it
has under any Credit Support Document to which it is a party and has
taken all necessary action to authorise such execution, delivery and
performance;
(iii) No Violation or Conflict. Such execution, delivery and
performance do not violate or conflict with any law applicable to it,
any provision of its constitutional documents, any order or judgment
of any court or other agency of government applicable to it or any of
its assets or any contractual restriction binding on or affecting it
or any of its assets;
(iv) Consents. All governmental and other consents that are required
to have been obtained by it with respect to this Agreement or any
Credit Support Document to which it is a party have been obtained and
are in full force and effect and all conditions of any such consents
have been complied with; and
(v) Obligations Binding. Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal,
valid and binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy, reorganisation,
insolvency, moratorium or similar laws affecting creditors' rights
generally and subject, as to enforceability, to equitable principles
of general application (regardless of whether enforcement is sought
in a proceeding in equity or at law)).
(b) Absence of Certain Events. No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has
occurred and is continuing and no such event or circumstance would occur as a
result of its entering into or performing its obligations under this Agreement
or any Credit Support Document to which it is a party.
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(c) Absence of Litigation. There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at law or in equity or before any court, tribunal, governmental body, agency
or official or any arbitrator that is likely to affect the legality, validity
or enforceability against it of this Agreement or any Credit Support Document
to which it is a party or its ability to perform its obligations under this
Agreement or such Credit Support Document.
(d) Accuracy of Specified Information. All applicable information that is
furnished in writing by or on behalf of it to the other party and is
identified for the purpose of this Section 3(d) in the Schedule is, as of the
date of the information, true, accurate and complete in every material
respect.
(e) Payer Tax Representation. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(e) is accurate and true.
(f) Payee Tax Representations. Each representation specified in the Schedule
as being made by it for the purpose of this Section 3(f) is accurate and true.
4. Agreements
Each party agrees with the other that, so long as either party has or may have
any obligation under this Agreement or under any Credit Support Document to
which it is a party:
(a) Furnish Specified Information. It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:
(i) any forms, documents or certificates relating to taxation
specified in the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any
Confirmation; and
(iii) upon reasonable demand by such other party, any form or
document that may be required or reasonably requested in writing in
order to allow such other party or its Credit Support Provider to
make a payment under this Agreement or any applicable Credit Support
Document without any deduction or withholding for or on account of
any Tax or with such deduction or withholding at a reduced rate (so
long as the completion, execution or submission of such form or
document would not materially prejudice the legal or commercial
position of the party in receipt of such demand), with any such form
or document to be accurate and completed in a manner reasonably
satisfactory to such other party and to be executed and to be
delivered with any reasonably required certification,
in each case by the date specified in the Schedule or such Confirmation or, if
none is specified, as soon as reasonably practicable.
(b) Maintain Authorisations. It will use all reasonable efforts to maintain in
full force and effect all consents of any governmental or other authority that
are required to be obtained by it
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with respect to this Agreement or any Credit Support Document to which it is a
party and will use all reasonable efforts to obtain any that may become
necessary in the future.
(c) Comply with Laws. It will comply in all material respects with all
applicable laws and orders to which it may be subject if failure so to comply
would materially impair its ability to perform its obligations under this
Agreement or any Credit Support Document to which it is a party.
(d) Tax Agreement. It will give notice of any failure of a representation made
by it under Section 3(f) to be accurate and true promptly upon learning of
such failure.
(e) Payment of Stamp Tax. Subject to Section l I, it will pay any Stamp Tax
levied or imposed upon it or in respect of its execution or performance of
this Agreement by a jurisdiction in which it is incorporated, organized,
managed and controlled, or considered to have its seat, or in which a branch
or office through which it is acting for the purpose of this Agreement is
located ("Stamp Tax Jurisdiction") and will indemnify the other party against
any Stamp Tax levied or imposed upon the other party or in respect of the
other party's execution or performance of this Agreement by any such Stamp Tax
Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the
other party.
5. Events of Default and Termination Events
(a) Events of Default. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any of the following events constitutes an event of
default (an "Event of Default") with respect to such party:
(i) Failure to Pay or Deliver. Failure by the party to make, when
due, any payment under this Agreement or delivery under Section
2(a)(i) or 2(e) required to be made by it if such failure is not
remedied on or before the third Local Business Day after notice of
such failure is given to the party;
(ii) Breach of Agreement. Failure by the party to comply with or
perform any agreement or obligation (other than an obligation to make
any payment under this Agreement or delivery under Section 2(a)(i) or
2(e) or to give notice of a Termination Event or any agreement or
obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied
with or performed by the party in accordance with this Agreement if
such failure is not remedied on or before the thirtieth day after
notice of such failure is given to the party;
(iii) Credit Support Default.
(1) Failure by the party or any Credit Support Provider of
such party to comply with or perform any agreement or
obligation to be complied with or performed by it in
accordance with any Credit Support Document if such failure
is continuing after any applicable grace period has elapsed;
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(2) the expiration or termination of such Credit Support
Document or the failing or ceasing of such Credit Support
Document to be in full force and effect for the purpose of
this Agreement (in either case other than in accordance with
its terms) prior to the satisfaction of all obligations of
such party under each Transaction to which such Credit
Support Document relates without the written consent of the
other party; or
(3) the party or such Credit Support Provider disaffirms,
disclaims, repudiates or rejects, in whole or in part, or
challenges the validity of, such Credit Support Document;
(iv) Misrepresentation. A representation (other than a representation
under Section 3(e) or (f)) made or repeated or deemed to have been
made or repeated by the party or any Credit Support Provider of such
party in this Agreement or any Credit Support Document proves to have
been incorrect or misleading in any material respect when made or
repeated or deemed to have been made or repeated;
(v) Default under Specified Transaction. The party, any Credit
Support Provider of such party or any applicable Specified Entity of
such party (1) defaults under a Specified Transaction and, after
giving effect to any applicable notice requirement or grace period,
there occurs a liquidation of, an acceleration of obligations under,
or an early termination of, that Specified Transaction, (2) defaults,
after giving effect to any applicable notice requirement or grace
period, in making any payment or delivery due on the last payment,
delivery or exchange date of, or any payment on early termination of,
a Specified Transaction (or such default continues for at least three
Local Business Days if there is no applicable notice requirement or
grace period) or (3) disaffirms, disclaims, repudiates or rejects, in
whole or in part, a Specified Transaction (or such action is taken by
any person or entity appointed or empowered to operate it or act on
its behalf);
(vi) Cross Default. If "Cross Default" is specified in the Schedule
as applying to the party, the occurrence or existence of (1) a
default, event of default or other similar condition or event
(however described) in respect of such party, any Credit Support
Provider of such party or any applicable Specified Entity of such
party under one or more agreements or instruments relating to
Specified Indebtedness of any of them (individually or collectively)
in an aggregate amount of not less than the applicable Threshold
Amount (as specified in the Schedule) which has resulted in such
Specified Indebtedness becoming, or becoming capable at such time of
being declared, due and payable under such agreements or instruments,
before it would otherwise have been due and payable or (2) a default
by such party, such Credit Support Provider or such Specified Entity
(individually or collectively) in making one or more payments on the
due date thereof in an aggregate amount of not less than the
applicable Threshold Amount under such agreements or instruments
(after giving effect to any applicable notice requirement or grace
period);
(vii) Bankruptcy. The party, any Credit Support Provider of such
party or any applicable Specified Entity of such party: -
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(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable
to pay its debts or fails or admits in writing its inability
generally to pay its debts as they become due; (3) makes a
general assignment, arrangement or composition with or for
the benefit of its creditors; (4) institutes or has
instituted against it a proceeding seeking a judgment of
insolvency or bankruptcy or any other relief under any
bankruptcy or insolvency law or other similar law affecting
creditors' rights, or a petition is presented for its
winding-up or liquidation, and, in the case of any such
proceeding or petition instituted or presented against it,
such proceeding or petition (A) results in a judgment of
insolvency or bankruptcy or the entry of an order for relief
or the making of an order for its winding-up or liquidation
or (B) is not dismissed, discharged, stayed or restrained in
each case within 30 days of the institution or presentation
thereof; (5) has a resolution passed for its winding-up,
official management or liquidation (other than pursuant to a
consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or
other similar official for it or for all or substantially
all its assets; (7) has a secured party take possession of
all or substantially all its assets or has a distress,
execution, attachment, sequestration or other legal process
levied, enforced or sued on or against all or substantially
all its assets and such secured party maintains possession,
or any such process is not dismissed, discharged, stayed or
restrained, in each case within 30 days thereafter; (8)
causes or is subject to any event with respect to it which,
under the applicable laws of any jurisdiction, has an
analogous effect to any of the events specified in clauses
(1) to (7) (inclusive); or (9) takes any action in
furtherance of, or indicating its consent to, approval of,
or acquiescence in, any of the foregoing acts; or
(viii) Merger Without Assumption. The party or any Credit Support
Provider of such party consolidates or amalgamates with, or merges
with or into, or transfers all or substantially all its assets to,
another entity and, at the time of such consolidation, amalgamation,
merger or transfer: -
(1) the resulting, surviving or transferee entity fails to
assume all the obligations of such party or such Credit
Support Provider under this Agreement or any Credit Support
Document to which it or its predecessor was a party by
operation of law or pursuant to an agreement reasonably
satisfactory to the other party to this Agreement; or
(2) the benefits of any Credit Support Document fail to
extend (without the consent of the other party) to the
performance by such resulting, surviving or transferee
entity of its obligations under this Agreement.
(b) Termination Events. The occurrence at any time with respect to a party or,
if applicable, any Credit Support Provider of such party or any Specified
Entity of such party of any event specified below constitutes an Illegality if
the event is specified in (i) below, a Tax Event if the event is specified in
(ii) below or a Tax Event Upon Merger if the event is specified in (iii)
below, and, if specified to be applicable, a Credit Event
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Upon Merger if the event is specified pursuant to (iv) below or an Additional
Termination Event if the event is specified pursuant to (v) below:
(i) Illegality. Due to the adoption of, or any change in, any
applicable law after the date on which a Transaction is entered into,
or due to the promulgation of, or any change in, the interpretation
by any court, tribunal or regulatory authority with competent
jurisdiction of any applicable law after such date, it becomes
unlawful (other than as a result of a breach by the party of Section
4(b)) for such party (which will be the Affected Party): -
(1) to perform any absolute or contingent obligation to make
a payment or delivery or to receive a payment or delivery in
respect of such Transaction or to comply with any other
material provision of this Agreement relating to such
Transaction; or
(2) to perform, or for any Credit Support Provider of such
party to perform, any contingent or other obligation which
the party (or such Credit Support Provider) has under any
Credit Support Document relating to such Transaction;
(ii) Tax Event. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on
which a Transaction is entered into (regardless of whether such
action is taken or brought with respect to a party to this Agreement)
or (y) a Change in Tax Law, the party (which will be the Affected
Party) will, or there is a substantial likelihood that it will, on
the next succeeding Scheduled Payment Date (I) be required to pay to
the other party an additional amount in respect of an Indemnifiable
Tax under Section 2(d)(i)(4) (except in respect of interest under
Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which
an amount is required to be deducted or withheld for or on account of
a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) and no additional amount is required to be paid in respect of
such Tax under Section 2(d)(i)(4) (other than by reason of Section
2(d)(i)(4)(A) or (B));
(iii) Tax Event Upon Merger. The party (the "Burdened Party") on the
next succeeding Scheduled Payment Date will either (1) be required to
pay an additional amount in respect of an Indemnifiable Tax under
Section 2(d)(i)(4) (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has
been deducted or withheld for or on account of any Indemnifiable Tax
in respect of which the other party is not required to pay an
additional amount (other than by reason of Section 2(d)(i)(4)(A) or
(B)), in either case as a result of a party consolidating or
amalgamating with, or merging with or into, or transferring all or
substantially all its assets to, another entity (which will be the
Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);
(iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is
specified in the Schedule as applying to the party, such party ("X"),
any Credit Support Provider of X or any applicable Specified Entity
of X consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and
such action does not constitute an event described in Section
5(a)(viii) but the creditworthiness of the
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resulting, surviving or transferee entity is materially weaker than
that of X, such Credit Support Provider or such Specified Entity, as
the case may be, immediately prior to such action (and, in such
event, X or its successor or transferee, as appropriate, will be the
Affected Party); or
(v) Additional Termination Event. If any "Additional Termination
Event" is specified in the Schedule or any Confirmation as applying,
the occurrence of such event (and, in such event, the Affected Party
or Affected Parties shall be as specified for such Additional
Termination Event in the Schedule or such Confirmation).
(c) Event of Default and Illegality. If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an
Event of Default.
6. Early Termination
(a) Right to Terminate Following Event of Default. If at any time an Event of
Default with respect to a party (the "Defaulting Party") has occurred and is
then continuing, the other party (the "Non-defaulting Party") may, by not more
than 20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective as
an Early Termination Date in respect of all outstanding Transactions. If,
however, "Automatic Early Termination" is specified in the Schedule as
applying to a party, then an Early Termination Date in respect of all
outstanding Transactions will occur immediately upon the occurrence with
respect to such party of an Event of Default specified in Section
5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8), and as
of the time immediately preceding the institution of the relevant proceeding
or the presentation of the relevant petition upon the occurrence with respect
to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to
the extent analogous thereto, (8).
(b) Right to Terminate Following Termination Event.
(i) Notice. If a Termination Event occurs, an Affected Party will,
promptly upon becoming aware of it, notify the other party,
specifying the nature of that Termination Event and each Affected
Transaction and will also give such other information about that
Termination Event as the other party may reasonably require.
(ii) Transfer to Avoid Termination Event. If either an Illegality
under Section 5(b)(i)(1) or a Tax Event occurs and there is only one
Affected Party, or if a Tax Event Upon Merger occurs and the Burdened
Party is the Affected Party, the Affected Party will, as a condition
to its right to designate an Early Termination Date under Section
6(b)(iv), use all reasonable efforts (which will not require such
party to incur a loss, excluding immaterial, incidental expenses) to
transfer within 20 days after it gives notice under Section 6(b)(i)
all its rights and obligations under this Agreement in respect of the
Affected Transactions to another of its Offices or Affiliates so that
such Termination Event ceases to exist.
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If the Affected Party is not able to make such a transfer it will
give notice to the other party to that effect within such 20 day
period, whereupon the other party may effect such a transfer within
30 days after the notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be
subject to and conditional upon the prior written consent of the
other party, which consent will not be withheld if such other party's
policies in effect at such time would permit it to enter into
transactions with the transferee on the terms proposed.
(iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1)
or a Tax Event occurs and there are two Affected Parties, each party
will use all reasonable efforts to reach agreement within 30 days
after notice thereof is given under Section 6(b)(i) on action to
avoid that Termination Event.
(iv) Right to Terminate. If: -
(1) a transfer under Section 6(b)(ii) or an agreement under
Section 6(b)(iii), as the case may be, has not been effected
with respect to all Affected Transactions within 30 days
after an Affected Party gives notice under Section 6(b)(i);
or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event
Upon Merger or an Additional Termination Event occurs, or a
Tax Event Upon Merger occurs and the Burdened Party is not
the Affected Party,
either party in the case of an Illegality, the Burdened Party in the
case of a Tax Event Upon Merger, any Affected Party in the case of a
Tax Event or an Additional Termination Event if there is more than
one Affected Party, or the party which is not the Affected Party in
the case of a Credit Event Upon Merger or an Additional Termination
Event if there is only one Affected Party may, by not more than 20
days notice to the other party and provided that the relevant
Termination Event is then continuing, designate a day not earlier
than the day such notice is effective as an Early Termination Date in
respect of all Affected Transactions.
(c) Effect of Designation.
(i) If notice designating an Early Termination Date is given under
Section 6(a) or (b), the Early Termination Date will occur on the
date so designated, whether or not the relevant Event of Default or
Termination Event is then continuing.
(ii) Upon the occurrence or effective designation of an Early
Termination Date, no further payments or deliveries under Section
2(a)(i) or 2(e) in respect of the Terminated Transactions will be
required to be made, but without prejudice to the other provisions of
this Agreement. The amount, if any, payable in respect of an Early
Termination Date shall be determined pursuant to Section 6(e).
(d) Calculations.
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(i) Statement. On or as soon as reasonably practicable following the
occurrence of an Early Termination Date, each party will make the
calculations on its part, if any, contemplated by Section 6(e) and
will provide to the other party a statement (1) showing, in
reasonable detail, such calculations (including all relevant
quotations and specifying any amount payable under Section 6(e)) and
(2) giving details of the relevant account to which any amount
payable to it is to be paid. In the absence of written confirmation
from the source of a quotation obtained in determining a Market
Quotation, the records of the party obtaining such quotation will be
conclusive evidence of the existence and accuracy of such quotation.
(ii) Payment Date. An amount calculated as being due in respect of
any Early Termination Date under Section 6(e) will be payable on the
day that notice of the amount payable is effective (in the case of an
Early Termination Date which is designated or occurs as a result of
an Event of Default) and on the day which is two Local Business Days
after the day on which notice of the amount payable is effective (in
the case of an Early Termination Date which is designated as a result
of a Termination Event). Such amount will be paid together with (to
the extent permitted under applicable law) interest thereon (before
as well as after judgment) in the Termination Currency, from (and
including) the relevant Early Termination Date to (but excluding) the
date such amount is paid, at the Applicable Rate. Such interest will
be calculated on the basis of daily compounding and the actual number
of days elapsed.
(e) Payments on Early Termination. If an Early Termination Date occurs, the
following provisions shall apply based on the parties' election in the
Schedule of a payment measure, either "Market Quotation" or "Loss", and a
payment method, either the "First Method" or the "Second Method". If the
parties fail to designate a payment measure or payment method in the Schedule,
it will be deemed that "Market Quotation" or the "Second Method", as the case
may be, shall apply. The amount, if any, payable in respect of an Early
Termination Date and determined pursuant to this Section will be subject to
any Set-off.
(i) Events of Default. If the Early Termination Date results from an
Event of Default: -
(1) First Method and Market Quotation. If the First Method
and Market Quotation apply, the Defaulting Party will pay to
the Non-defaulting Party the excess, if a positive number,
of (A) the sum of the Settlement Amount (determined by the
Non-defaulting Party) in respect of the Terminated
Transactions and the Termination Currency Equivalent of the
Unpaid Amounts owing to the Non-defaulting Party over (B)
the Termination Currency Equivalent of the Unpaid Amounts
owing to the Defaulting Party.
(2) First Method and Loss. If the First Method and Loss
apply, the Defaulting Party will pay to the Non-defaulting
Party, if a positive number, the Non-defaulting Party's Loss
in respect of this Agreement.
(3) Second Method and Market Quotation. If the Second Method
and Market Quotation apply, an amount will be payable equal
to (A) the sum of the
12
Settlement Amount (determined by the Non-defaulting Party)
in respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid Amounts owing
to the Non-defaulting Party less (B) the Termination
Currency Equivalent of the Unpaid Amounts owing to the
Defaulting Party. If that amount is a positive number, the
Defaulting Party will pay it to the Non-defaulting Party; if
it is a negative number, the Non-defaulting Party will pay
the absolute value of that amount to the Defaulting Party.
(4) Second Method and Loss. If the Second Method and Loss
apply, an amount will be payable equal to the Non-defaulting
Party's Loss in respect of this Agreement. If that amount is
a positive number, the Defaulting Party will pay it to the
Non-defaulting Party; if it is a negative number, the
Non-defaulting Party will pay the absolute value of that
amount to the Defaulting Party.
(ii) Termination Events. If the Early Termination Date results from a
Termination Event: -
(1) One Affected Party. If there is one Affected Party, the
amount payable will be determined in accordance with Section
6(e)(i)(3), if Market Quotation applies, or Section
6(e)(i)(4), if Loss applies, except that, in either case,
references to the Defaulting Party and to the Non-defaulting
Party will be deemed to be references to the Affected Party
and the party which is not the Affected Party, respectively,
and, if Loss applies and fewer than all the Transactions are
being terminated, Loss shall be calculated in respect of all
Terminated Transactions.
(2) Two Affected Parties. If there are two Affected Parties:
-
(A) if Market Quotation applies, each party will
determine a Settlement Amount in respect of the
Terminated Transactions, and an amount will be
payable equal to (I) the sum of (a) one-half of the
difference between the Settlement Amount of the
party with the higher Settlement Amount ("X") and
the Settlement Amount of the party with the lower
Settlement Amount ("Y") and (b) the Termination
Currency Equivalent of the Unpaid Amounts owing to
X less (II) the Termination Currency Equivalent of
the Unpaid Amounts owing to Y; and
(B) if Loss applies, each party will determine its
Loss in respect of this Agreement (or, if fewer
than all the Transactions are being terminated, in
respect of all Terminated Transactions) and an
amount will be payable equal to one-half of the
difference between the Loss of the party with the
higher Loss ("X") and the Loss of the party with
the lower Loss ("Y").
If the amount payable is a positive number, Y will pay it to
X; if it is a negative number, X will pay the absolute value
of that amount to Y.
(iii) Adjustment for Bankruptcy. In circumstances where an Early
Termination Date occurs because "Automatic Early Termination" applies
in respect of a party, the amount determined under this Section 6(e)
will be subject to such adjustments as are appropriate
13
and permitted by law to reflect any payments or deliveries made by
one party to the other under this Agreement (and retained by such
other party) during the period from the relevant Early Termination
Date to the date for payment determined under Section 6(d)(ii).
(iv) Pre-Estimate. The parties agree that if Market Quotation applies
an amount recoverable under this Section 6(e) is a reasonable
pre-estimate of loss and not a penalty. Such amount is payable for
the loss of bargain and the loss of protection against future risks
and except as otherwise provided in this Agreement neither party will
be entitled to recover any additional damages as a consequence of
such losses.
7. Transfer
Subject to Section 6(b)(ii), neither this Agreement nor any interest or
obligation in or under this Agreement may be transferred (whether by way of
security or otherwise) by either party without the prior written consent of
the other party, except that: -
(a) a party may make such a transfer of this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity (but without prejudice to
any other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its interest in any
amount payable to it from a Defaulting Party under Section 6(e).
Any purported transfer that is not in compliance with this Section will be
void.
8. Contractual Currency
(a) Payment in the Contractual Currency. Each payment under this Agreement
will be made in the relevant currency specified in this Agreement for that
payment (the "Contractual Currency"). To the extent permitted by applicable
law, any obligation to make payments under this Agreement in the Contractual
Currency will not be discharged or satisfied by any tender in any currency
other than the Contractual Currency, except to the extent such tender results
in the actual receipt by the party to which payment is owed, acting in a
reasonable manner and in good faith in converting the currency so tendered
into the Contractual Currency, of the full amount in the Contractual Currency
of all amounts payable in respect of this Agreement. If for any reason the
amount in the Contractual Currency so received falls short of the amount in
the Contractual Currency payable in respect of this Agreement, the party
required to make the payment will, to the extent permitted by applicable law,
immediately pay such additional amount in the Contractual Currency as may be
necessary to compensate for the shortfall. If for any reason the amount in the
Contractual Currency so received exceeds the amount in the Contractual
Currency payable in respect of this Agreement, the party receiving the payment
will refund promptly the amount of such excess.
(b) Judgments. To the extent permitted by applicable law, if any judgment or
order expressed in a currency other than the Contractual Currency is rendered
(i) for the payment of any amount owing in respect of this Agreement, (ii) for
the payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of
14
another court for the payment of any amount described in (i) or (ii) above,
the party seeking recovery, after recovery in full of the aggregate amount to
which such party is entitled pursuant to the judgment or order, will be
entitled to receive immediately from the other party the amount of any
shortfall of the Contractual Currency received by such party as a consequence
of sums paid in such other currency and will refund promptly to the other
party any excess of the Contractual Currency received by such party as a
consequence of sums paid in such other currency if such shortfall or such
excess arises or results from any variation between the rate of exchange at
which the Contractual Currency is converted into the currency of the judgment
or order for the purposes of such judgment or order and the rate of exchange
at which such party is able, acting in a reasonable manner and in good faith
in converting the currency received into the Contractual Currency, to purchase
the Contractual Currency with the amount of the currency of the judgment or
order actually received by such party. The term "rate of exchange" includes,
without limitation, any premiums and costs of exchange payable in connection
with the purchase of or conversion into the Contractual Currency.
(c) Separate Indemnities. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other
obligations in this Agreement, will be enforceable as separate and independent
causes of action, will apply notwithstanding any indulgence granted by the
party to which any payment is owed and will not be affected by judgment being
obtained or claim or proof being made for any other sums payable in respect of
this Agreement.
(d) Evidence of Loss. For the purpose of this Section 8, it will be sufficient
for a party to demonstrate that it would have suffered a loss had an actual
exchange or purchase been made.
9. Miscellaneous
(a) Entire Agreement. This Agreement constitutes the entire agreement and
understanding of the parties with respect to its subject matter and supersedes
all oral communication and prior writings with respect thereto.
(b) Amendments. No amendment, modification or waiver in respect of this
Agreement will be effective unless in writing (including a writing evidenced
by a facsimile transmission) and executed by each of the parties or confirmed
by an exchange of telexes or electronic messages on an electronic messaging
system.
(c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.
(d) Remedies Cumulative. Except as provided in this Agreement, the rights,
powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law.
(e) Counterparts and Confirmations.
(i) This Agreement (and each amendment, modification and waiver in
respect of it) may be executed and delivered in counterparts
(including by facsimile transmission), each of which will be deemed
an original.
15
(ii) The parties intend that they are legally bound by the terms of
each Transaction from the moment they agree to those terms (whether
orally or otherwise). A Confirmation shall he entered into as soon as
practicable and may he executed and delivered in counterparts
(including by facsimile transmission) or be created by an exchange of
telexes or by an exchange of electronic messages on an electronic
messaging system, which in each case will be sufficient for all
purposes to evidence a binding supplement to this Agreement. The
parties will specify therein or through another effective means that
any such counterpart, telex or electronic message constitutes a
Confirmation.
(f) No Waiver of Rights. A failure or delay in exercising any right, power or
privilege in respect of this Agreement will not be presumed to operate as a
waiver, and a single or partial exercise of any right, power or privilege will
not be presumed to preclude any subsequent or further exercise, of that right,
power or privilege or the exercise of any other right, power or privilege.
(g) Headings. The headings used in this Agreement are for convenience of
reference only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.
10. Offices; Multibranch Parties
(a) If Section 10(a) is specified in the Schedule as applying, each party that
enters into a Transaction through an Office other than its head or home office
represents to the other party that, notwithstanding the place of booking
office or jurisdiction of incorporation or organisation of such party, the
obligations of such party are the same as if it had entered into the
Transaction through its head or home office. This representation will be
deemed to be repeated by such party on each date on which a Transaction is
entered into.
(b) Neither party may change the Office through which it makes and receives
payments or deliveries for the purpose of a Transaction without the prior
written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such
Multibranch Party may make and receive payments or deliveries under any
Transaction through any Office listed in the Schedule, and the Office through
which it makes and receives payments or deliveries with respect to a
Transaction will be specified in the relevant Confirmation.
11. Expenses
A Defaulting Party will, on demand, indemnify and hold harmless the other
party for and against all reasonable out-of-pocket expenses, including legal
fees and Stamp Tax, incurred by such other party by reason of the enforcement
and protection of its rights under this Agreement or any Credit Support
Document to which the Defaulting Party is a party or by reason of the early
termination of any Transaction, including, but not limited to, costs of
collection.
12. Notices
(a) Effectiveness. Any notice or other communication in respect of this
Agreement may be given in any manner set forth below (except that a notice or
other communication under Section
16
5 or 6 may not be given by facsimile transmission or electronic messaging
system) to the address or number or in accordance with the electronic
messaging system details provided (see the Schedule) and will be deemed
effective as indicated:
(i) if in writing and delivered in person or by courier, on the date
it is delivered;
(ii) if sent by telex, on the date the recipient's answerback is
received;
(iii) if sent by facsimile transmission, on the date that
transmission is received by a responsible employee of the recipient
in legible form (it being agreed that the burden of proving receipt
will be on the sender and will not be met by a transmission report
generated by the sender's facsimile machine);
(iv) if sent by certified or registered mail (airmail, if overseas)
or the equivalent (return receipt requested), on the date that mail
is delivered or its delivery is attempted; or
(v) if sent by electronic messaging system, on the date that
electronic message is received,
unless the date of that delivery (or attempted delivery) or that receipt, as
applicable, is not a Local Business Day or that communication is delivered (or
attempted) or received, as applicable, after the close of business on a Local
Business Day, in which case that communication shall be deemed given and
effective on the first following day that is a Local Business Day.
(b) Change of Addresses. Either party may by notice to the other change the
address, telex or facsimile number or electronic messaging system details at
which notices or other communications are to be given to it.
13. Governing Law and Jurisdiction
(a) Governing Law. This Agreement will be governed by and construed in
accordance with the law specified in the Schedule.
(b) Jurisdiction. With respect to any suit, action or proceedings relating to
this Agreement ("Proceedings"), each party irrevocably:
(i) submits to the jurisdiction of the English courts, if this
Agreement is expressed to be governed by English law, or to the
non-exclusive jurisdiction of the courts of the State of New York and
the United States District Court located in the Borough of Manhattan
in New York City, if this Agreement is expressed to be governed by
the laws of the State of New York; and
(ii) waives any objection which it may have at any time to the laying
of venue of any Proceedings brought in any such court, waives any
claim that such Proceedings have been brought in an inconvenient
forum and further waives the right to object, with respect to such
Proceedings, that such court does not have any jurisdiction over such
party.
17
Nothing in this Agreement precludes either party from bringing Proceedings in
any other jurisdiction (outside, if this Agreement is expressed to be governed
by English law, the Contracting States, as defined in Section 1(3) of the
Civil Jurisdiction and Judgments Xxx 0000 or any modification, extension or
re-enactment thereof for the time being in force) nor will the bringing of
Proceedings in any one or more jurisdictions preclude the bringing of
Proceedings in any other jurisdiction.
(c) Service of Process. Each party irrevocably appoints the Process Agent (if
any) specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. If for any reason any party's
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable
to the other party. The parties irrevocably consent to service of process
given in the manner provided for notices in Section 12. Nothing in this
Agreement will affect the right of either party to serve process in any other
manner permitted by law.
(d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent
permitted by applicable law, with respect to itself and its revenues and
assets (irrespective of their use or intended use), all immunity on the
grounds of sovereignty or other similar grounds from (i) suit, (ii)
jurisdiction of any court, (iii) relief by way of injunction, order for
specific performance or for recovery of property, (iv) attachment of its
assets (whether before or after judgment) and (v) execution or enforcement of
any judgment to which it or its revenues or assets might otherwise be entitled
in any Proceedings in the courts of any jurisdiction and irrevocably agrees,
to the extent permitted by applicable law, that it will not claim any such
immunity in any Proceedings.
14. Definitions
As used in this Agreement:
"Additional Termination Event" has the meaning specified in Section 5(b).
"Affected Party" has the meaning specified in Section 5(b).
"Affected Transactions" means (a) with respect to any Termination Event
consisting of an Illegality, Tax Event or Tax Event Upon Merger, all
Transactions affected by the occurrence of such Termination Event and (b) with
respect to any other Termination Event, all Transactions.
"Affiliate" means, subject to the Schedule, in relation to any person, any
entity controlled, directly or indirectly, by the person, any entity that
controls, directly or indirectly, the person or any entity directly or
indirectly under common control with the person. For this purpose, "control"
of any entity or person means ownership of a majority of the voting power of
the entity or person.
"Applicable Rate" means:
(a) in respect of obligations payable or deliverable (or which would have been
but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
18
(b) in respect of an obligation to pay an amount under Section 6(e) of either
party from and after the date (determined in accordance with Section 6(d)(ii))
on which that amount is payable, the Default Rate;
(c) in respect of all other obligations payable or deliverable (or which would
have been but for Section 2(a)(iii)) by a Non-defaulting Party, the
Non-default Rate; and
(d) in all other cases, the Termination Rate.
"Burdened Party" has the meaning specified in Section 5(b).
"Change in Tax Law" means the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any law (or in the
application or official interpretation of any law) that occurs on or after the
date on which the relevant Transaction is entered into.
"consent" includes a consent, approval, action, authorisation, exemption,
notice, filing, registration or exchange control consent.
"Credit Event Upon Merger" has the meaning specified in Section 5(b).
"Credit Support Document" means any agreement or instrument that is specified
as such in this Agreement. "Credit Support Provider" has the meaning specified
in the Schedule.
"Default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the relevant payee (as certified by it) if it
were to fund or of funding the relevant amount plus 1% per annum.
"Defaulting Party" has the meaning specified in Section 6(a).
"Early Termination Date" means the date determined in accordance with Section
6(a) or 6(b)(iv). "Event of Default" has the meaning specified in Section 5(a)
and, if applicable, in the Schedule. "Illegality" has the meaning specified in
Section 5(b).
"Indemnifiable Tax" means any Tax other than a Tax that would not be imposed
in respect of a payment under this Agreement but for a present or former
connection between the jurisdiction of the government or taxation authority
imposing such Tax and the recipient of such payment or a person related to
such recipient (including, without limitation, a connection arising from such
recipient or related person being or having been a citizen or resident of such
jurisdiction, or being or having been organized, present or engaged in a trade
or business in such jurisdiction, or having or having had a permanent
establishment or fixed place of business in such jurisdiction, but excluding a
connection arising solely from such recipient or related person having
executed, delivered, performed its obligations or received a payment under, or
enforced, this Agreement or a Credit Support Document).
"law" includes any treaty, law, rule or regulation (as modified, in the case
of tax matters, by the practice of any relevant governmental revenue
authority) and "lawful" and "unlawful" will be construed accordingly.
19
"Local Business Day" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and
foreign currency deposits) (a) in relation to any obligation under Section
2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so
specified, as otherwise agreed by the parties in writing or determined
pursuant to provisions contained, or incorporated by reference, in this
Agreement, (b) in relation to any other payment, in the place where the
relevant account is located and, if different, in the principal financial
centre, if any, of the currency of such payment, (c) in relation to any notice
or other communication, including notice contemplated under Section 5(a)(i),
in the city specified in the address for notice provided by the recipient and,
in the case of a notice contemplated by Section 2(b), in the place where the
relevant new account is to be located and (d) in relation to Section
5(a)(v)(2), in the relevant locations for performance with respect to such
Specified Transaction.
"Loss" means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency
Equivalent of an amount that party reasonably determines in good faith to be
its total losses and costs (or gain, in which case expressed as a negative
number) in connection with this Agreement or that Terminated Transaction or
group of Terminated Transactions, as the case may be, including any loss of
bargain, cost of funding or, at the election of such party but without
duplication, loss or cost incurred as a result of its terminating,
liquidating, obtaining or reestablishing any hedge or related trading position
(or any gain resulting from any of them). Loss includes losses and costs (or
gains) in respect of any payment or delivery required to have been made
(assuming satisfaction of each applicable condition precedent) on or before
the relevant Early Termination Date and not made, except, so as to avoid
duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does
not include a party's legal fees and out-of-pocket expenses referred to under
Section 11. A party will determine its Loss as of the relevant Early
Termination Date, or, if that is not reasonably practicable, as of the
earliest date thereafter as is reasonably practicable. A party may (but need
not) determine its Loss by reference to quotations of relevant rates or prices
from one or more leading dealers in the relevant markets.
"Market Quotation" means, with respect to one or more Terminated Transactions
and a party making the determination, an amount determined on the basis of
quotations from Reference Market-makers. Each quotation will be for an amount,
if any, that would be paid to such party (expressed as a negative number) or
by such party (expressed as a positive number) in consideration of an
agreement between such party (taking into account any existing Credit Support
Document with respect to the obligations of such party) and the quoting
Reference Market-maker to enter into a transaction (the "Replacement
Transaction") that would have the effect of preserving for such party the
economic equivalent of any payment or delivery (whether the underlying
obligation was absolute or contingent and assuming the satisfaction of each
applicable condition precedent) by the parties under Section 2(a)(i) in
respect of such Terminated Transaction or group of Terminated Transactions
that would, but for the occurrence of the relevant Early Termination Date,
have been required after that date. For this purpose, Unpaid Amounts in
respect of the Terminated Transaction or group of Terminated Transactions are
to be excluded but, without limitation, any payment or delivery that would,
but for the relevant Early Termination Date, have been required (assuming
satisfaction of each applicable condition precedent) after that Early
Termination Date is to be included. The Replacement Transaction would be
subject to such documentation as such party and the Reference Market-maker
may, in
20
good faith, agree. The party making the determination (or its agent) will
request each Reference Market-maker to provide its quotation to the extent
reasonably practicable as of the same day and time (without regard to
different time zones) on or as soon as reasonably practicable after the
relevant Early Termination Date. The day and time as of which those quotations
are to be obtained will be selected in good faith by the party obliged to make
a determination under Section 6(e), and, if each party is so obliged, after
consultation with the other. If more than three quotations are provided, the
Market Quotation will be the arithmetic mean of the quotations, without regard
to the quotations having the highest and lowest values. If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations. For this purpose, if
more than one quotation has the same highest value or lowest value, then one
of such quotations shall be disregarded. If fewer than three quotations are
provided, it will be deemed that the Market Quotation in respect of such
Terminated Transaction or group of Terminated Transactions cannot be
determined.
"Non-default Rate" means a rate per annum equal to the cost (without proof or
evidence of any actual cost) to the Non-defaulting Party (as certified by it)
if it were to fund the relevant amount.
"Non-defaulting Party" has the meaning specified in Section 6(a).
"Office" means a branch or office of a party, which may be such party's head
or home office.
"Potential Event of Default" means any event which, with the giving of notice
or the lapse of time or both, would constitute an Event of Default.
"Reference Market-makers" means four leading dealers in the relevant market
selected by the party determining a Market Quotation in good faith (a) from
among dealers of the highest credit standing which satisfy all the criteria
that such party applies generally at the time in deciding whether to offer or
to make an extension of credit and (b) to the extent practicable, from among
such dealers having an office in the same city.
"Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a)
in which the party is incorporated, organized, managed and controlled or
considered to have its seat, (b) where an Office through which the party is
acting for purposes of this Agreement is located, (c) in which the party
executes this Agreement and (d) in relation to any payment, from or through
which such payment is made.
"Scheduled Payment Date" means a date on which a payment or delivery is to be
made under Section 2(a)(i) with respect to a Transaction.
"Set-off" means set-off, offset, combination of accounts, right of retention
or withholding or similar right or requirement to which the payer of an amount
under Section 6 is entitled or subject (whether arising under this Agreement,
another contract, applicable law or otherwise) that is exercised by, or
imposed on, such payer.
"Settlement Amount" means, with respect to a party and any Early Termination
Date, the sum of: -
21
(a) the Termination Currency Equivalent of the Market Quotations (whether
positive or negative) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation is determined; and
(b) such party's Loss (whether positive or negative and without reference to
any Unpaid Amounts) for each Terminated Transaction or group of Terminated
Transactions for which a Market Quotation cannot be determined or would not
(in the reasonable belief of the party making the determination) produce a
commercially reasonable result.
"Specified Entity" has the meanings specified in the Schedule.
"Specified Indebtedness" means, subject to the Schedule, any obligation
(whether present or future, contingent or otherwise, as principal or surety or
otherwise) in respect of borrowed money.
"Specified Transaction" means, subject to the Schedule, (a) any transaction
(including an agreement with respect thereto) now existing or hereafter
entered into between one party to this Agreement (or any Credit Support
Provider of such party or any applicable Specified Entity of such party) and
the other party to this Agreement (or any Credit Support Provider of such
other party or any applicable Specified Entity of such other party) which is a
rate swap transaction, basis swap, forward rate transaction, commodity swap,
commodity option, equity or equity index swap, equity or equity index option,
bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, currency swap transaction,
cross-currency rate swap transaction, currency option or any other similar
transaction (including any option with respect to any of these transactions),
(b) any combination of these transactions and (c) any other transaction
identified as a Specified Transaction in this Agreement or the relevant
confirmation.
"Stamp Tax" means any stamp, registration, documentation or similar tax.
"Tax" means any present or future tax, levy, impost, duty, charge, assessment
or fee of any nature (including interest, penalties and additions thereto)
that is imposed by any government or other taxing authority in respect of any
payment under this Agreement other than a stamp, registration, documentation
or similar tax.
"Tax Event" has the meaning specified in Section 5(b).
"Tax Event Upon Merger" has the meaning specified in Section 5(b).
"Terminated Transactions" means with respect to any Early Termination Date (a)
if resulting from a Termination Event, all Affected Transactions and (b) if
resulting from an Event of Default, all Transactions (in either case) in
effect immediately before the effectiveness of the notice designating that
Early Termination Date (or, if "Automatic Early Termination" applies,
immediately before that Early Termination Date).
"Termination Currency" has the meaning specified in the Schedule.
22
"Termination Currency Equivalent" means, in respect of any amount denominated
in the Termination Currency, such Termination Currency amount and, in respect
of any amount denominated in a currency other than the Termination Currency
(the "Other Currency"), the amount in the Termination Currency determined by
the party making the relevant determination as being required to purchase such
amount of such Other Currency as at the relevant Early Termination Date, or,
if the relevant Market Quotation or Loss (as the case may be), is determined
as of a later date, that later date, with the Termination Currency at the rate
equal to the spot exchange rate of the foreign exchange agent (selected as
provided below) for the purchase of such Other Currency with the Termination
Currency at or about 11:00 a.m. (in the city in which such foreign exchange
agent is located) on such date as would be customary for the determination of
such a rate for the purchase of such Other Currency for value on the relevant
Early Termination Date or that later date. The foreign exchange agent will, if
only one party is obliged to make a determination under Section 6(e), be
selected in good faith by that party and otherwise will be agreed by the
parties.
"Termination Event" means an Illegality, a Tax Event or a Tax Event Upon
Merger or, if specified to be applicable, a Credit Event Upon Merger or an
Additional Termination Event.
"Termination Rate" means a rate per annum equal to the arithmetic mean of the
cost (without proof or evidence of any actual cost) to each party (as
certified by such party) if it were to fund or of funding such amounts.
"Unpaid Amounts" owing to any party means, with respect to an Early
Termination Date, the aggregate of (a) in respect of all Terminated
Transactions, the amounts that became payable (or that would have become
payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or
prior to such Early Termination Date and which remain unpaid as at such Early
Termination Date and (b) in respect of each Terminated Transaction, for each
obligation under Section 2(a)(i) which was (or would have been but for Section
2(a)(iii)) required to be settled by delivery to such party on or prior to
such Early Termination Date and which has not been so settled as at such Early
Termination Date, an amount equal to the fair market value of that which was
(or would have been) required to be delivered as of the originally scheduled
date for delivery, in each case together with (to the extent permitted under
applicable law) interest, in the currency of such amounts, from (and
including) the date such amounts or obligations were or would have been
required to have been paid or performed to (but excluding) such Early
Termination Date, at the Applicable Rate. Such amounts of interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed. The fair market value of any obligation referred to in clause (b)
above shall be reasonably determined by the party obliged to make the
determination under Section 6(e) or, if each party is so obliged, it shall be
the average of the Termination Currency Equivalents of the fair market values
reasonably determined by both parties.
23
IN WITNESS WHEREOF the parties have executed this document on the respective
dates specified below with effect from the date specified on the first page of
this document.
XXXXXXX XXXXX MITSUI MARINE GSAA HOME EQUITY TRUST 2006-5
DERIVATIVE PRODUCTS, L.P.
By; GSMMDPOP, Inc. By: JPMorganchase Bank, National Association
General Partner not in its individual capacity but solely
as Securities Administrator
By: /s/ Xxxxx Xxxxx By: /s/ Xxxxx Xxxxxxxxxx
------------------------ -----------------------------------
Name: Xxxxx Xxxxx Name: Xxxxx Xxxxxxxxxx
Title: Vice President Title: Assistant Vice President
Date: 3/30/06 Date: 3/30/06
24
EXECUTION COPY
--------------
SCHEDULE
to the
MASTER AGREEMENT
dated as of March 30, 2006
between
XXXXXXX SACHS MITSUI MARINE
DERIVATIVE PRODUCTS, L.P.
a limited partnership organized
under the laws of Delaware
("Party
and
GSAA HOME EQUITY TRUST 2006-5
a trust organized
under the laws of the State of New York
("Par B").
Part 1. Termination Provisions.
(a) "Specified Entity" means in relation to Party A for the purpose of:
Section 5(a)(v), Not Applicable.
Section 5(a)(vi), Not Applicable.
Section 5(a)(vii), Not Applicable.
Section 5(b)(iv), Not Applicable.
and in relation to Party B for the purpose of:
Section 5(a)(v), Not Applicable.
Section 5(a)(vi), Not Applicable.
Section 5(a)(vii), Not Applicable.
Section 5(b)(iv), Not Applicable.
(b) "Specified Transaction" shall have the meaning specified in Section
14 of this Agreement.
(c) The "Breach of Agreement" provisions of Section 5(a)(ii) will not
apply to Party A or Party B.
(d) The "Credit Support Default" provisions of Section 5(a)(iii) will
apply to Party A and will not apply to Party B.
(e) The "Misrepresentation" provisions of Section 5(a)(iv) will not apply
to Party A or Party B.
(f) The "Cross Default" provisions of Section 5(a)(vi) will not apply to
Party A or Party B.
(g) With respect to Party B only, Section 5(a)(vii)(2) is hereby amended
as follows:
"(2) becomes insolvent or is unable to pay its debts (other than
payments due to holders of its subordinate certificates) or fails or
admits in writing its inability generally to pay its debts (other
than payments to holders of its subordinate certificates) as they
become due"
(h) The "Merger without Assumption" provisions of Section 5(a)(viii) will
apply to Party A and will not apply to Party B.
The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not
apply to Party A or Party B.
(j) The "Automatic Early Termination" provisions of Section 6(a) will not
apply to Party A or Party B.
(k) Payments on Early Termination. For the purpose of Section 6(e):
(i) Market Quotation will apply.
(ii) The Second Method will apply.
(1) "Termination Currency" means U.S. Dollars.
(m) The "Additional Termination Event" provisions of Section 5(b)(v) will
apply as set forth in Part 5(m) hereof.
(n) The "Default under Specified Transaction" provisions of Section
5(a)(v) will not apply to Party A or Party B.
(o) The "Tax Event" provisions of Section 5(b)(ii) will apply to Party A
and will not apply to Party B.
(p) The "Tax Event Upon Merger" provisions of Section 5(b)(iii) will
apply to Party A and will not apply to Party B.
2
Part 2. Tax Representations.
(a) Payer Representations. For purposes of Section 3(e) of this
Agreement, Party A and Party B each make 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) or 6(e) 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
representations made by the other party pursuant to Section 3(f) of
this Agreement, (ii) the satisfaction of the agreement contained in
Section 4(a)(i) or 4(a)(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 subclause
(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.
Party A Payee Representations. For the purpose of Section 3(f) of this
Agreement, Party A makes the following representations:
(i) It is a "U.S. Payee" within the meaning of Treasury Regulation Section
1.1441-5(b).
(ii) It is a United States person within the meaning of Section 7701(a)(30) of
the Internal Revenue Code of 1986, as amended.
Party B Payee Representations. For the purpose of Section 3(f) of this
Agreement, Party B makes the following representation:
(i) It is a trust created under an agreement governed by New York law.
Part 3. Agreement to Deliver Documents.
For the purpose of Section 4(a), each party agrees to deliver the
following documents, as applicable:
(a) Tax forms, documents, or certificates to be delivered are:
Party A agrees to complete, execute, and deliver to Party B, United
States Internal Revenue Service Form W-9 or any successor of such form:
(i) on a date which is before the first scheduled payment date under this
Agreement; (ii) promptly upon reasonable demand by Party B; and (iii)
promptly upon learning that any such forms previously provided by Party A
has become obsolete or incorrect.
3
Party B agrees to complete, execute, and deliver to Party A, United
States Internal Revenue Service Form W-9 or any successor of such forms:
(i) on a date which is before the first scheduled payment date under this
Agreement; (ii) promptly upon reasonable demand by Party A; and (iii)
promptly upon learning that any such forms previously provided by Party B
has become obsolete or incorrect.
(b) Other documents to be delivered are:
Covered by
Party required to Form/Document/ Date by which Section 3(d)
deliver document Certificate to be delivered Representation
Party A Power of Attorney with At execution of Yes
respect to Party A this Agreement
Party A Support Agreement dated At execution of Yes
as of October 8, 1993 this Agreement
among Party A, Mitsui
Marine and Fire
Insurance Co., Ltd.
("Mitsui Marine"),
and The Xxxxxxx Xxxxx
Group, Inc. ("Goldman
Group") (the "Support
Agreement") accompanied
by a certificate of an
authorized officer of
Party A, certifying
that it is a true,
complete and correct
copy of the original
Support Agreement
Party A Guaranty dated as of At execution of this Yes
December 20, 2000 Agreement
between Mitsui Marine
and Xxxxxxx Xxxxx Group
(the "Guaranty"),
accompanied by a
certificate certifying
that it is a true,
complete and correct
copy of the original
Guaranty
Party A Most recently prepared As soon as possible Yes
annual balance sheet following request
of Party A of Party B
Party A Legal opinions with At execution of No
respect to Party A this Agreement
4
Party A and Incumbency certificate At execution of this Yes
Party B or other documents Agreement
evidencing the authority,
incumbency and specimen
signature of each
person executing this
Agreement,any Credit
Support Document or any
Confirmation, as the
case may be.
Party B Servicer Remittance Promptly upon Yes
Reports becoming available
Party B Legal opinion with At execution of this No
respect to Party B Agreement
Party B An executed copy of Within 30 days after No
the Master Servicing the date of this
and Trust Agreement, Agreement
dated as of March 1,
2006, among GS Mortgage
Securities Corp., as
depositor, U.S. Bank
National Association, as
trustee, and JPMorgan
Chase Bank, National
Association, as securities
administrator.
Part 4. Miscellaneous.
(a) Addresses for Notices. For the purpose of Section 12(a): Address for
notices or communications to Party A:
Address: 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
X.X.X.
Attention: Swap Administration
Telex No.: 421344
Answerback: GOLSAX
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
Electronic Messaging
5
System Details: None
With a copy to:
Address: 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
X.X.X.
Attention: Treasury Administration
Telex No.: 421344
Answerback: GOLSAX
Facsimile No. (000) 000-0000
Telephone No.: (000) 000-0000
Electronic Messaging
System Details: None
Addresses for Notices. For the purpose of Section 12(a): Address for
notices or communications to Party B:
Address: JPMorgan Chase Bank, National
Association
0000 Xxxx Xxxxxx Xxxx,
Xxxxx 000,
Xxx Xxxxxx, Xxxx 00000
Attention: Corporate Trust Services, GSAA
HOME EQUITY TRUST 2006-5
(b) Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not Applicable
Party B appoints as its Process Agent: Not Applicable
With a copy to:
Address: Standard & Poor's Ratings Services, a
division of XxXxxx-Xxxx, Inc.
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Residential Mortgage Surveillance
Group
Facsimile: 212-438-2652 With
a copy to:
Address: Xxxxx'x Investors Service, Inc.
6
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Residential Mortgage Backed Securities
Group
Facsimile: 000-000-0000
(c) Offices; Multibranch Parties.
(i) The provisions of Section 10(a) will be applicable.
(ii) For the purpose of Section 10(c):
Party A is not a Multibranch Party.
Party B is not a Multibranch Party.
(d) Calculation Agent. The Calculation Agent is Party A.
(e) Credit Support Document. Details of any Credit Support Document.
(i) With respect to Party A, (A) the Support Agreement, (B) the
Guaranty and (C) any Credit Support Annex that may be entered into
in connection with any of the events described in Part 5(m)(ii) of
this Schedule.
(ii) With respect to Party B, not applicable.
Each Credit Support Document is incorporated by reference into and
constitutes part of this Agreement and each Confirmation as if set
forth in full in this Agreement or such Confirmation.
(f) Credit Support Provider.
(i) Credit Support Provider means in relation to Party A, Goldman
Group and Mitsui Marine; provided that all defaults by,
misrepresentations of, actions or failures to act by, or
circumstances or events applicable to a "Credit Support Provider" as
such term is used in this Agreement shall be deemed in all such
circumstances to refer to defaults simultaneously in effect with
respect to both Goldman Group and Mitsui Marine, misrepresentations
made by both Goldman Group and Mitsui Marine, actions or failures to
act simultaneously by both Goldman Group and Mitsui Marine, and
circumstances or events simultaneously applicable to both Goldman
Group and Mitsui Marine.
(ii) Credit Support Provider means in relation to Party B, Not
Applicable.
7
(g) Governing Law. This Agreement and each Confirmation will be governed
by, and construed and enforced in accordance with, the substantive law of the
State of New York, without reference to its choice of law doctrine.
(h) Jurisdiction. Section 13(b) is hereby amended by: (i) deleting in the
second line of subparagraph (i) thereof the word "non-"; and (ii) deleting the
final paragraph thereof.
(i) Netting of Payments. Subparagraph (ii) of Section 2(c) will apply to
Transactions with effect from the date of this Agreement. Notwithstanding
anything to the contrary in Section 2(c), amounts that are payable with
respect to the same Calculation Period shall be netted, as provided in Section
2(c), even if such amounts are not due on the same Payment Date.
0) "Affiliate" will have the meaning specified in Section 14; provided,
however, that for purposes of Section 3(c), such term shall only refer to any
Credit Support Provider of the party and/or any party that is a Specified
Entity for Bankruptcy and shall apply to Party A only. Party B shall be deemed
to have no Affiliates.
Part 5. Other Provisions.
(a) Accuracy of Specified Information. With respect to Party A, Section
3(d) is hereby amended by adding in the third line thereof after the word
"respect" and before the period the words "or, in the case of audited or
unaudited financial statements or balance sheets, a fair presentation of the
financial condition of the relevant person."
(b) Transfer. Section 7 is hereby amended by:
(i) adding in the third line thereof after the word "party," the
words "which consent shall not be unreasonably withheld or
delayed" and adding in the third line thereof after the clause
"that: -" the words "provided that the Rating Agency Condition
is satisfied in all events (including in the event of a
transfer under Section 6(b)(ii));
(ii) adding in the second line of subparagraph (a) thereof after the
words "assets to," the words "or reorganization, incorporation,
reincorporation, reconstitution, or reformation into or as";
(iii) deleting at the end of subparagraph (a) thereof the word
"and";
(iv) deleting in the second line of subparagraph (b) thereof the
period and replacing it with "; and";
(v) adding after subparagraph (b) thereof the following
subparagraph (c):
8
(c) in addition to, and not in lieu of, the preceding transfer rights,
Party A may, without recourse by Party B or Party A's transferee to or against
Party A, transfer this Agreement, in whole, but not in part, to any of Party
A's Affiliates or any of the Affiliates of Goldman Group pursuant to
documentation prepared by Party A, provided that:
(i) either (A) such transferee must have a long-term, unsecured,
unsubordinated debt obligation ratings or financial program
ratings (or other similar ratings) by S&P which are equal to or
greater than the comparable long-term, unsecured,
unsubordinated debt obligation ratings or financial program
ratings (or other similar ratings) of Party A immediately prior
to such transfer, or (B) the obligations transferred to such
transferee must be guaranteed by Party A pursuant to a guaranty
in substantially the form of the Guaranty of the Credit Support
Provider or other agreement or instrument consented to by Party
B or other agreement or instrument mutually agreed upon by both
parties and satisfactory to S&P;
(ii) the transferee will not, as a result of such transfer, be
required to withhold or deduct on account of a Tax under
Section 2(d)(i) on the next succeeding Scheduled Payment Date
an amount in excess of that which Party A would have been
required to so withhold or deduct on the next succeeding
Scheduled Payment Date in the absence of such transfer unless
the transferee will be required to make payments of additional
amounts pursuant to Section 2(d)(i)(4) in respect of such
excess;
(iii) an Event of Default or a Termination Event does not occur as a
result of such transfer;
(iv) the Rating Agency Condition is satisfied. With respect to the
results described in subclause (ii) above, Party A will cause
the transferee to make, and Party B will make, such reasonable
Payer Tax Representations and Payee Tax Representations as may
be mutually agreed upon by the transferee and Party B in order
to permit such parties to determine that such results will not
occur upon or after the transfer;
(v) Party A agrees to transfer only to a transferee in a
jurisdiction, which it is aware is a "netting" jurisdiction,
that is in which, by opinion of counsel published by ISDA,
netting under this Agreement shall be enforceable; and
0
(vi) Party A will be responsible for any costs or expenses
incurred in connection with such transfer.
(vi) adding at the end of Section 7 the following sentence:
Except as may otherwise be stated in Section 7(c) hereof or in the
documentation evidencing a transfer, a transfer of all of the
obligations of Party A made in compliance with this Section will
constitute an acceptance and assumption of such obligations (and any
related interests so transferred) by the transferee, a novation of
the transferee in place of Party A with respect to such obligations
(and any related interests so transferred), and a release and
discharge by Party B of Party A from, and an agreement by Party B
not to make any claim for payment, liability, or otherwise against
Party A with respect to, such obligations from and after the
effective date of the transfer.
(c) Set-Off. Without affecting the provisions of this Agreement requiring
the calculation of certain net payment amounts, as a result of an Event of
Default or Termination Event or otherwise, all payments under this Agreement
will be made without setoff or counterclaim.
(d) Reference Market-makers. The definition of "Reference Market-makers"
in Section 14 is hereby amended by adding in the fourth line thereof after the
word "credit" the words "or to enter into transactions similar in nature to
Transactions".
(e) 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 to this Agreement;
provided, however, that this severability provision shall not be applicable if
any provision of Section 2, 5, 6, or 13 (or any definition or provision in
Section 14 to the extent it relates to, or is used in or in connection with
any such Section) shall be so held to be invalid or unenforceable.
(f) Waiver of Right to Trial by Jury. Each party hereby irrevocably
waives, to the fullest extent permitted by applicable law, any right it may
have to trial by jury in respect of any suit, action or proceeding relating to
this Agreement.
(g) Credit Support Default. Subparagraph (3) of Section 5(a)(iii) is
hereby amended by adding in the second line thereof after the word "Document"
and before the semicolon the words "(or such action is taken by any person or
entity appointed or empowered to operate it or act on its behalf)."
10
(h) Additional Representations. Section 3 is hereby amended by adding
the following additional subsections:
(i) No Agency. With respect to Party A, it is entering into this
Agreement and each Transaction as principal (and not as agent or in
any other capacity, fiduciary or otherwise) and, with respect to
Party B, JPMorgan Chase Bank, National Association is entering into
the Agreement in its capacity as Securities Administrator of Party
B.
(ii) Eligible Contract Participant. It is an "eligible contract
participant" as defined in the U.S. Commodity Exchange Act.
(iii) Non-Reliance. Party A is acting for its own account and
JPMorgan Chase Bank, National Association is acting as securities
administrator for Party B. It has made its own independent decisions
to enter into that Transaction and as to whether that Transaction is
appropriate or proper for it 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 that
Transaction; it being understood that information and explanations
related to the terms and conditions of a Transaction shall not be
considered investment advice or a recommendation to enter into that
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 that Transaction.
(iv) Assessment and Understanding; Status of Parties. 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 and risks of that Transaction. It is
also capable of assuming, and assumes, the risks of that
Transaction. The other parry is not acting as a fiduciary for or an
adviser to it in respect of that Transaction.
(i) RESERVED.
(j) Regarding Party A. Party B acknowledges and agrees that Party A has
had and will have no involvement in and, accordingly, accepts no
responsibility for: (i) the establishment, structure, or choice of assets of
Party B; (ii) the selection of any person performing services for or acting on
behalf of Party B; (iii) the selection of Party A as the counterparty; (iv)
the terms of the Certificates; (v) the preparation of or passing on the
disclosure and other information contained in any prospectus or prospectus
supplement for the Certificates, the Master Servicing and Trust Agreement, or
any other agreements or documents used by Party B or any other party in
connection with the marketing and sale of the Certificates; (vi) the ongoing
operations and administration of Party B, including the furnishing of any
information to Party B which is not specifically required under this
Agreement; or (vii) any other aspect of Party B's existence except for those
matters specifically identified in this Agreement.
11
(k) No Recourse. The Certificates represent an equity interest in Party
B only and the foregoing does not represent an interest in or obligation of
Party A, and no recourse may be had by the holders of the Certificates against
Party A or its assets with respect to the Notes and the Certificates and/or
this Agreement.
(1) Indemnifiable Tax. Party A agrees that Party B will not be required
to pay any additional amounts pursuant to Section 2(d)(i)(4) of the Agreement
in respect of an Indemnifiable Tax. If Party A is required to pay additional
amounts in respect of a withholding tax pursuant to Section 2(d)(i)(4) of this
Agreement, Party A may transfer this Agreement, subject to satisfaction of the
Rating Agency Condition, as provided in Section 6(b)(ii) of this Agreement and
such transfer shall not require the consent of Party B to the extent it is in
conformance with the provisions of Section 7(c), as amended herein.
(m) Additional Termination Events.
(i) It shall be an Additional Termination Event, with Party A as
the sole Affected Party, if the Depositor determines at any
time that it is required for purposes of compliance with Item
1115(b) of Regulation AB to provide any financial or other data
relating to Party A and, within 15 calendar days of such
determination, Party A fails to assign this Agreement and all
of its obligations hereunder to a substitute counterparty that
(A) has agreed to provide any financial or other data required
under Regulation AB, (B) has agreed to provide indemnifications
relating to such financial or other data acceptable to the
Depositor, (C) satisfies the Rating Agency Condition and (D) is
approved by the Depositor (which approval shall not be
unreasonably withheld). For the avoidance of doubt, unless
otherwise specified in this Agreement, Party A shall be under
no obligation to provide any such financial or other data,
whether in connection with this Termination Event or otherwise.
For purposes of this Termination Event, (i) "Commission" shall
mean the Securities and Exchange Commission, (ii) "Depositor"
shall mean GS Mortgage Securities Corp., and (iii) "Regulation
AB" shall mean the 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.
(ii) It shall also be an Additional Termination Event if (i) an
Optional Termination Date is designated pursuant to the Master
Servicing and Trust Agreement (a "Redemption Termination") and
(ii) there remains no more than 5 Business Days prior to the
proposed Redemption Date. In the case of a Redemption
Termination, both Party A and Party B shall have the right to
cause a termination of this Agreement and, for purposes of
Section 6(e)(ii) of this Agreement, Party B shall be the sole
Affected Party. Following notification from the Securities
Administrator that it has received a
12
redemption notice, Party A shall provide the Securities
Administrator from time to time, upon request, with good faith
estimates of the amount that would be payable under Section
6(e)(ii) in the event of such Redemption Termination. Any
termination payment payable in respect of such Additional
Termination Event shall be paid on the relevant Redemption
Date.
(iii) (I) It shall also be an Additional Termination Event, with
Party A the sole Affected Party (except as expressly provided
herein) if Party A, a replacement counterparty, or a person or
an entity that guarantees the obligations of Party A or a
replacement counterparty, as the case may be, has a rating that
does not satisfy the Required Hedge Counterparty Rating (but is
at least "BBB-" or "A-3" (if applicable) by S&P), or S&P or
Moody's withdraws its ratings and none of the following events
has occurred:
(A) within 30 days of such failure to satisfy the
Required Hedge Counterparty Rating, Party A or such
replacement counterparty, as the case may be,
transfers this Agreement, in whole, but not in part,
to a counterparty that satisfies the Required Hedge
Counterparty Rating, subject to satisfaction of the
Rating Agency Condition;
(B) within 30 days of such failure to satisfy the
Required Hedge Counterparty Rating, Party A or such
replacement counterparty, as the case may be,
collateralizes its Exposure to Party B pursuant to an
ISDA Credit Support Annex, subject to satisfaction of
the Rating Agency Condition, as applicable; provided
that such ISDA Credit Support Annex shall be made a
Credit Support Document for Party A pursuant to an
amendment of this Agreement in a form acceptable to
the Securities Administrator which amendment shall
also be subject to satisfaction of Rating Agency
Condition;
(C) within 30 days of such failure to satisfy the
Required Hedge Counterparty Rating, the obligations
of Party A or such replacement counterparty, as the
case may be, under this Agreement are guaranteed by a
person or entity that satisfies the Required Hedge
Counterparty Rating, subject to satisfaction of the
Rating Agency Condition; or
(D) within 30 days of such failure to satisfy the
Required Hedge Counterparty Rating, Party A or such
replacement counterparty, as the case may be, takes
such other steps, if any, to enable the Issuer to
satisfy the Rating Agency Condition.
13
(II) It shall also be an Additional Termination Event,
with Party A as the sole Affected Party (except as
expressly provided herein) if Party A, a replacement
counterparty, or a person or an entity that guarantees the
obligations of Parry A or a replacement counterparty, as
the case may be, has a rating of less than "BBB-" or "A-3"
(if applicable) by S&P and within 7 days thereafter, Party
A or such replacement counterparty, as the case may be,
while collateralizing its Exposure to Party B, fails to
transfer this Agreement, in whole, but not in part, to a
counterparty that satisfies the Required Hedge
Counterparty Rating, subject to satisfaction of the Rating
Agency Condition.
Upon downgrade of Party A below the Required Hedge Counterparty
Rating or below "BBB-" or "A-3" (if applicable), or if S&P or
Moody's withdraws its ratings for any reason, Party A will promptly
give notice of the circumstances to Party B and to the rating
agencies that at the time are providing ratings for the
Certificates.
Party B shall be entitled to (A)(1) in case of an Additional
Termination Event described in Part 5(m)(iii)(I), designate a date
that is not earlier than the expiration of the 30 day period
referred to in Part 5(m)(iii)(I) as an Early Termination Date in
respect of all transactions under this Agreement by giving notice to
Party A at least 10 days prior to the date so designated (which
notice may be given prior to the expiration of such 30 day period)
and (2) in case of an Additional Termination Event described in this
Part 5(m)(iii)(II), immediately designate an Early Termination Date,
in respect of all transactions under this Agreement by giving notice
to Party A and (B) no later than the respective dates specified in
clause (A)(1) and (A)(2), transfer the rights and obligations of
Party A hereunder to a counterparty that satisfies the Required
Hedge Counterparty Rating, subject to satisfaction of the Rating
Agency Condition.
In connection with a transfer of this Agreement as described in this
Part 5(m)(iii), Party A shall, at its sole cost and expense, use
commercially reasonable efforts to seek a replacement counterparty.
In addition, if Party A pursues any of the alternative actions
contemplated in paragraphs (A), (B), (C) and (D) of Part
5(m)(iii)(I) above, it shall do so at its sole cost and expense.
As used herein, "Required Hedge Counterparty Rating" means, with
respect to a counterparty or entity guaranteeing the obligations of
such counterparty, (x) either (i) if such counterparty or entity has
only a long-term rating by Moody's, a long-term senior, unsecured
debt obligation rating, financial program rating or other similar
rating (as the case may be, the "Long-Term rating") of at least
"Aa3" by Moody's and if rated "Aa3" by Xxxxx'x is not on negative
credit watch by Moody's or (ii) if such counterparty or entity has a
14
Long-Term Rating and a short-term rating by Moody's, a Long-Term
Rating of at least "Al" by Moody's and a short-term rating of "P-1"
by Moody's and, in each case, such rating is not on negative credit
watch by Moody's and (y) (i) a short-term rating of at least "A-1"
by S&P or (ii) if such counterparty or entity does not have a
short-term rating by S&P, a Long-Term Rating of at least "A+" by
S&P.
For the purposes of determining the Settlement Amount with respect
to the designation of an Early Termination Date arising from the
Additional Termination Event specified in Party 5(m)(iii), both
Party A and Party B shall be Affected Parties. If the Settlement
Amount calculated pursuant to this subclause (iii) is an amount
owing by Party B to Party A, then such payment shall be a Swap
Termination Payment payable by Party B to Party A in accordance with
the priority of payments described in the Master Servicing and Trust
Agreement; provided, however, that (a) if Party A does not after the
exercise of commercially reasonable efforts cause any of the
conditions specified in Part 5(m)(iii)(I)(A) to (D) to be satisfied,
Party B shall use commercially reasonable efforts to enter into a
replacement Transaction(s) with a counterparty acceptable to the
Rating Agencies, in respect of the Affected Transaction(s) relating
to the Additional Termination Event; and (b) where multiple
quotations are available such replacement Transaction(s) shall be
entered into based on the quoted price(s) that would result in the
largest payment made to Party B by the replacement counterparty (it
being understood that Party A may be permitted to actively solicit
and obtain such quotations on behalf of Party B); and (c) to the
extent that payments are received by Party B as a result of entering
into such replacement Transaction(s), then Party A shall have first
priority as to such payments versus all other creditors of Party B
and Party B shall pay the lesser of (x) the amount so received and
(y) the Swap Termination Payment to the extent not already paid by
Party B over to Party A immediately upon receipt.
As used herein, "Exposure" means, as of any date of determination,
the amount, if any, that would be payable to Party B by Party A
under this Agreement if an Early Termination Date were to occur as
of such date of determination as a result of a Termination Event,
Party A were the sole Affected Party, all Transactions were
terminated in connection with such Early Termination Date and
(solely for purposes of determining Exposure) the amount of such
payment were calculated using Market Quotation.
For any Additional Termination Event, the date that Party A or Party B,
as the case may be, specifies in its notice of its election to terminate
shall be the Early Termination Date for the Transactions; provided, that
solely in the case of an Additional Termination Event described in
subclause (ii) above, the Early Termination Date shall be no earlier than
the 3rd Business Day preceding the Redemption Date and no later than the
Redemption Date.
15
(n) Indemnifiable Tax. The definition of "Indemnifiable Tax" in Section
14 is hereby amended by adding the following sentence at the end thereof:
Notwithstanding the foregoing, "Indemnifiable Tax" also means any
Tax imposed in respect of a payment under this Agreement by reason
of a Change in Tax Law by a government or taxing authority of a
Relevant Jurisdiction of the party making such payment, unless the
other party is incorporated, organized, managed and controlled, or
considered to have its seat in such jurisdiction, or is acting for
purposes of this Agreement through a branch or office located in
such jurisdiction.
(o) Limited Recourse; Non-petition. Party A agrees that the obligations
of Party B hereunder are limited recourse obligations payable solely from the
assets of Party B, and due to the extent funds are available for the payment
thereof in accordance with the priority of payments described in the Master
Servicing and Trust Agreement, all outstanding obligations of Party B
hereunder shall be extinguished. Party A agrees that it will not, prior to the
date which is at least one year and one day or, if longer, the then applicable
preference period following the payment in full of all the Certificates issued
pursuant to the Master Servicing and Trust Agreement and the expiration of all
applicable preference periods under Title 11 of the United States Code or
other applicable law relating to any such payment, acquiesce, petition or
otherwise invoke or cause Party B to invoke the process of any governmental
authority for the purpose of commencing or sustaining a case (whether
voluntary or involuntary) against Party B under any bankruptcy, insolvency or
similar law or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of Party B or any
substantial part of its property or ordering the winding-up or liquidation of
the affairs of Party B. Nothing contained herein shall prohibit Party A from
submitting a claim, or proof of claim, in any proceeding or process instituted
by or against Party B by any person other than Party A or its Affiliates.
Party A and Party B agree that this Part 5(p) shall survive the termination of
this Agreement for any reason whatsoever.
(p) Securities Administrator Capacity. It is expressly understood and
agreed by the parties hereto that insofar as this Agreement is executed by the
Securities Administrator (i) this Agreement is executed and delivered by
JPMorgan Chase Bank, National Association, not in its individual capacity but
solely as Securities Administrator under the Master Servicing and Trust
Agreement in the exercise of the powers and authority conferred to and vested
in it thereunder and (ii) under no circumstances shall JPMorgan Chase Bank,
National Association. in its individual capacity be personally liable for the
payment of any indebtedness or expenses or be personally liable for the breach
or failure of any obligation, representation, warranty or covenant made or
undertaken under this Agreement on behalf of Party B.
(q) Additional Party A Covenant. Following a failure to satisfy the
Required Hedge Counterparty Rating in accordance with Part 5(m)(iii)(I), Party
A shall take the actions described in accordance with Part 5(m)(iii)(I)(A),
(B), (C) or (D). Following a failure to satisfy the rating requirements set
forth in Part 5(m)(iii)(II), Party A shall take the actions described in
accordance with Part 5(m)(iii)(II).
16
(r) Agreements: Furnish Specified Information. Section 4(a) is hereby
amended by adding at the end thereof the following paragraph:
Notwithstanding the foregoing provisions of this Section 4(a), the
parties agree that, pursuant to the terms of the Power of Attorney
with respect to Party A referred to in Part 3(b) of this Schedule,
any one or more of the officers of Party A's general partner who has
been designated as an agent and attorney in fact of Party A will so
deliver to Party B or such government or taxing authority the
specified or requested forms, documents, or certificates.
(s) Confirmations. Transactions shall be promptly confirmed by the
parties by Confirmations exchanged by mail, telex, facsimile or other
electronic means. Where a Transaction is confirmed by means of an electronic
messaging system that the parties have elected to use to confirm such
Transaction (i) such confirmation will constitute a "Confirmation" as referred
to in this Agreement even where not so specified in the confirmation and (ii)
such Confirmation will supplement, form part of, and be subject to this
Agreement and all provisions in this Agreement will govern the Confirmation
except as modified therein.
(t) Tax Documentation. Section 4(a)(iii) of the Agreement is hereby
amended by adding prior to the existing text:
"upon the earlier of learning that any such form or document is
required or"
(u) Inconsistency-Trade Call. In the event of any inconsistency between a
telephone conversation, including a trade call and a Confirmation signed by
both parties, the Confirmation shall govern.
(v) Condition Precedent. The condition precedent in Section 2(a)(iii)(1)
does not apply to a payment and delivery owing by a party if the other party
shall have satisfied in full all its payment or delivery obligations under
Section 2(a)(i) and shall at the relevant time have no future payment or
delivery obligations, whether absolute or contingent, under Section 2(a)(i).
(w) Definitions. This Agreement shall be subject to the 2000 Definitions
(the "2000 Definitions") as published by the International Swaps and
Derivatives Association Inc. The provisions of the 2000 Definitions are
incorporated by reference in and shall be deemed a part of this Agreement,
except that all references in the 2000 Definitions to a "Swap Transaction"
shall be deemed references to a "Transaction" for the purposes of this
Agreement. Capitalized terms used and not otherwise defined herein (or in the
2000 Definitions) shall have the respective meanings ascribed to such terms in
the Master Servicing and Trust Agreementreferred to in Part 3(b). If in
relation to any Transaction there is any inconsistency between the 2000
Definitions, this Agreement, the Master Servicing and Trust Agreement, any
Confirmation and any other definitions published by ISDA that are incorporated
into any Confirmation, the following will prevail for purposes of such
Transaction in the order of precedence indicated: (i) such Confirmation
(without reference to any definitions or provisions incorporated therein);
(ii) the Master Servicing and Trust Agreement; (iii) this Agreement; (iv) such
other definitions; and (v) the 2000 Definitions.
17
(x) Amendments. Section 9(b) is hereby amended as follows:
(i) by inserting the following phrase immediately prior to the
period at the end of the sentence: "and the Rating Agency Condition
is satisfied"; and
(ii) by adding the following text thereto immediately following the
first sentence: "Amendments to this Agreement or the Schedule may
not be effected in a Confirmation."
(y) "Rating Agency Condition" means, with respect to any action to which
a Rating Agency Condition applies, that each rating agency then rating
the Certificates shall have been given ten days (or such shorter period
as is acceptable to each such rating agency) prior notice of that action
and that each such rating agency shall have notified the Securities
Administrator in writing that such action will not result in a reduction,
qualification or withdrawal of the then current rating of the
Certificates that it maintains.
18
IN WITNESS WHEREOF, the parties have executed this document on the
respective dates specified below with effect from the date specified on the
first page of this document.
XXXXXXX XXXXX MITSUI MARINE
DERIVATTVE PRODUCTS, L.P.
By: GSMMDPGP, Inc.,
General Partner
By: /s/ Xxxxx Xxxxx
------------------------------
Name: XXXXX XXXXX
Title: VICE PRE:3IDENT
Date:
GSAA DOME EQUITY TRUST 2006-5
By: JPMorgan Chase Bank, National
Association, not in its
individual capacity but
solely as Securities Administrator
By:
------------------------------
Name:
Title:
Date:
IN' WITNESS WHEREOF, the parties have executed this document on the
respective dates specified below with effect from the date specified on the
first page of this document.
XXXXXXX XXXXX MITSU1 MARINE
DERIVATIVE, PRODUCTS, L.P.
By: GSMMDPGP, Inc.,
General Partner
By:
------------------------------
Name: XXXXX XXXXX
Title: VICE PRE:3IDENT
Date:
GSAA HOME EQUITY TRUST 2006-5
By: JPMorgan Chase Bank, National
Association, not in its individual
capacity but solely as Securities
Administrator
By: /s/ Xxxxx Xxxxxxxxxx
-------------------------------
Name: XXXXX XXXXXXXXXX
Title: ASSISTANT VICE PRESIDENT
Date: 3/30/2006
Xxxxxxx Xxxxx Capital Markets. L.P. | 00 Xxxxx Xxxxxx x Xxx Xxxx Xxx Xxxx 00000
| Tel: 000-000-0000
swapconfirms2006: xxxx_xxxx00-0_xxxx0000x0.xx
[GRAPHIC OMITTED]
CONFIRMATION
DATE: March 23, 2006
TO: Xxxxxxx Xxxxx Mortgage Company, L.P. (Account No.
760-02799) Attention: Xxxxxx Xxxxxxx
TO: Xxxxxxx Xxxxx Mitsui Marine Derivative
Products, L.P. Te ephone No.: 000-000-0000
Fa,:simile No.: 000-000-0000
FROM: Gcldman Sachs Capital Markets,
L.P. Telephone No.: 000-000-0000
Facsimile No.: 000-000-0000
SUBJECT: Swap Transaction
REF NO: NUUS6038WO (920000000) / (006 831 671)
------------------------------------------------------------------------------
The purpose of th s communication is to set forth the terms and conditions of
the above referenced transaction entered into on the Trade Date specified
below (the "Transaction") between Xxxxxxx Xxxxx Capital Markets, L.P.
("GSCM"), guaranteed by The Xxxxxxx Sachs Group, Inc. ("Goldman Group"), and
Xxxxxxx Sachs Mortgage Company, L.P. ("Counterparty"). T-iis communication
constitutes a "Confirmation" as referred to in paragraph 2 below.
1. The definitions and provisions contained in the 2000 ISDA Definitions (the
"Definitions"), as published by the International Swaps and Derivatives
Association, Inc. are incorporated into this Confirmation.
1
2. This Confirmation evidences a complete and binding agreement between GSCM
and Counterparty as to the terms of the Transaction to which this Confirmation
relates, and this Confirmation evidences the sole Transaction for the benefit
of the GSAA Home Equity Trust 2006-5 ("GSAA"). If GSCM and Counterparty have
entered into a master agreement governing transactions of this type (the
"Agreement'), then this Transaction shall be governed thereby. If, and so long
as, the parties have not entered into such an Agreement then this Transaction
shall canstitute a "Transaction" within the scope of, and this Confirmation
shall supplement, form part of, and be subject to, an agreement in the form of
the 1992 ISDA Master Agreement (Multicurrency-Cross Border) (the "ISDA Form")
as if the parties had executed an agreement in such form effective as of the
Trade Date but without any Schedule except for (i) the election of Loss and
Second Method, (ii) New York law (without regard to the conflicts of law
principles) as the governing law, (iii) US Dollars as the Termination
Currency, (iv) the election that subparagraph (ii) of Section 2(c) will apply
to Transactions, (v) only Section 5(a)(i) Failure to Pay and Section 5(a)(vii)
Bankruptcy will be applicable to the parties (all other Events of Default will
not apply to either party), (vi) Section 5(a)(i) is modified by replacing the
word "third" in the last line of Section 5(a)(i) with the word `first"), (vii)
only Section 5(b)(i) Illegality, 5(b)(ii) Tax Event and Section 5(b)(iii) Tax
Event Upon Merger will be applicable to the parties (all other Termination
Events will not apply to either party), (viii) the Limited Recourse;
Non-Petition Provision (as described below in paragraph 4B) shall apply and
(ix) Set off undar Section 6(e) will not apply. In the event of any
inconsistency between the Definitions, the ISDA Form and this Confirmation,
this Confirmation will govern. Notwithstanding the foregoing, it is understood
and agreed that upon the assignment of this Transaction to GSMMDP and GSAA
pursuant to the terms of paragraph 4(A) hereof, this Transaction shall be
governed by the ISDA Master Agreement between such parties dated as of March
30, 2006.
3. The terms of thE! particular Transaction to which this Confirmation relates
are as follows:
Notional Amount: USD 1,200,000,000.00 (subject to adjustment in
accordance with the Schedule set forth in Annex I
hereto)
Trade Date: March 23, 2006
Effective Date: Xxxxx 00, 0000
Xxxxxxxxxxx Date: March 25, 2011, subject to adjustment in
accordance with the Modified Following Business
Initial Payment: Day Convention
Floating Amounts: USD 1,550,000 payable by GSCM to Xxxxxxx Xxxxx
Mortgage Company, L.P. on the Effective Date
Floating Rate Payer: GSCM
Floating Rate Player Payment Dates On the day that is one (1) Business Day prior to
each Floating Rate Period End Date
Floating Rate Option: USD-LIBOR-BBA
Floating Rate Designated Maturity: 1 Month
2
Floating Rate Spread: None
Floating Rate Raset Dates: The first day of each Calculation Period
Floating Rate Day Count Fraction: Actual/360
Floating Rate Pariod End Dates: Monthly, on the 25th day of each month,
commencing on April 25, 2006 and ending
on the Termination Date, subject to
adjustment in accordance with the
Modified Following Business Day
Convention.
Fixed Amounts:
Fixed Rate Payar: Counterparty
Fixed Rate Payar Payment Dates: On the day that is one (1) Business Day
prior to each Fixed Rate Period End Date
Fixed Rate: 5.18%
Fixed Rate Day Count Fraction: Actual/360
Fixed Rate Period End Dates: Monthly, on the 25th day of each month,
commencing on April 25, 2006 and ending on
the Termination Date, with no adjustment to
such Fixed Rate Period End Dates.
Business Days: New York
Calculation Agent: GSCM
Governing Law: New York law 4.
4. Additional Provisions:
3
A. Assignment Provisions: It is acknowledged and agreed by the parties that
this Transaction shall be subject to assignment first by Counterparty to GS
Mortgage Securities Corp., then= simultaneously, (i) by GSCM to Xxxxxxx Sachs
Mitsui Marine Derivative Products, L.P. ("GSMMDP") and (ii) by GS Mortgage
Securities Corp. to GSAA, and by GSAA, through a collateral assignment, to
JPMorgan Chase Bank, National Association (the "Securities Administrator"), on
behalf of U.S. Bank National Association (the "Trustee"), as trustee on behalf
of the holders of the GSAA Home Equity Trust 2006-5 Asset-Backed Certificates,
Series 2006-5, (CUSIP Numbers: 362334 GO 1, 362334 GR 9, 362334 GS 7, 362334
GT 5, 362334 JB 1, 362334 GU 362334 GV 0, 362334 GW 8, 362334 GX 6, 362334 GY
4, 362334 GZ 1, 362334 HA 5, 362334 HD 9, 362334 HB 3, 362334 HC 1, 362334 JA
3, 362334 HE 7, 362334 HF 4); the "Certificates") (each such assignee is
referred to herein as an "Assignee" and each such assignor is referred to
herein as an "Assignor"). These assignments shall occur on the day the
Assignor and Assignee agree to such assignment and provide written or oral
notification of the effective date of assignment to the relevant constant
party, or, in the case of a simultaneous doable assignment, the other assignor
and/or assignee, as appropriate (the "Constant Party") (each such day
hereinafter referred to as an "Assignment Date"). Furthermore, with respect to
each assignment of the Transaction to an Assignee, the Assignee shall accept
assignment of the Transaction subject to all terms of this Confirmation and
all references to the term "Counterparty" herein shall be deemed references to
each subsequent assignee of Countarparty and all references to the term "GSCM"
herein shall be deemed references to each subsequent assignee of "GSCM". On
each Assignment Date, Constant Party, the relevant Assignor and the relevant
Assignee, in consideration of the premises and the mutual covenants contained
herein and for other good and valuable consideration received, agree as
follows:
(a) Assignor sells, assigns, transfers, and sets over to Assignee, its
successors and permitted assigns, all of its right, title, and interest in,
to, under, and in respect of, the Transaction. Assignor releases and
discharges Constant Party from, and agrees not to make any claim against
Constant Party with respect to, any obligations of Constant Party arising and
to be performed under and in respect of the Transaction after the Assignment
Date. Assignor agrees that Assignee has no liability with respect to any
obligation arising or to be performed under and in respect of the Transaction
prior to or on the Assignment Date.
(b) Assignee accepts such sale, assignment and transfer and assumes and agrees
to perform each and every obligation of Assignor arising and to be performed
under the Transaction after the Assignment Date, with the same force and
effect as if Assignee had been a party to the Transaction originally; it being
understood and agreed that, with respect to the Securities Administrator as AE
signee, the Securities Administrator is an assignee solely by reason of its
capacity as indenture trustee (and not in its individual capacity) and the
Securities Administrator in its individual capacity shall have no obligation
or liability for payment of any indebtedness or expenses and shall not be
personally liable for the breach or failure of any obligation, representation,
warranty or covenant made or undertaken hereunder.
(c) Constant Party consents to the sale, assignment and transfer by Assignor
and the assumption by Assignee referred to above. Constant Party releases and
discharges Assignor from, and agrees nit to make any claim against Assignor
with respect to, any obligations of Assignor arising and to be performed under
and in respect of the Transaction after the Assignment Date. 'onstant Party
agrees that Assignee has no liability with respect to any obligation arising
or to be performed under and in respect of the Transaction prior to or on the
Assignment Date.
4
(d) Assignor hereby represents and warrants to, and covenants and agrees with,
Assignee and Constant Party thai: (i) it is duly organized, validly existing,
and in good standing under the law of the jurisdiction of its organization;
(ii) it has all requisite power and authority to assign and delegate to
Assignee its rights and obligations under the Transaction as provided herein
and has taken all necessary action to authorize such assignment and
delegation; and (iii) such assignment and celegation is its legal, valid, and
binding obligation enforceable against Assignor in accordance with the terms
hereof.
(e) Assignee hereby represents and warrants to, and covenants and agrees with,
Assignor and Constant Party that: (i) it is duly organized, validly existing,
and in good standing under the law of the jurisdiction cf its organization;
(ii) it has all requisite power and authority to assume the rights and
obligations of Assignor under the Transaction as provided herein and perform
its obligations under the Transaction and has taken all necessary action to
authorize such assumption and performance; and (iii) such assumption and the
Transaction is its legal, valid, and binding obligation enforceable against
Assignee in accordance with the terms hereof.
(f) Assignor and C instant Party acknowledge that as of the Assignment Date no
amounts are owed by Assigno- or Constant Party to the other under the
Transaction to which this assignment relates.
(g) Any additional assignments of this Transaction to a party other than an
Assignee shall require the consent of GSCM or GSMMDP, as the case may be, such
consent not to be unreasonably withheld. Notwithstanding any provision to the
contrary, no additional assignments of this Transaction to a party other than
an Assignee shall be made, and GSCM or GSMMDP, as the case may be, shall not
consent to such additional assignments of this Transaction until written
confirmation of consent is received from the rating agencies that have rated
the Trust Notes that such assignment will not result in a withdrawal or
downgrade of the rating of the Trust Notes. Furthermore, no amendment of this
Confirmation by an Assignee or other permitted assign shall be made, and GSCM
or GSMMDP, as the case may be, shall not consent to such Mendment of this
Confirmation, until written confirmation from the rating agency is received
that it has rated the Trust Notes and such amendment will not result in a
withdrawal or downgrade of the rating of the Trust Notes.
B. Limited Recourse; Non-Petition Provision:
To the extent GSAA or the Securities Administrator is a counterparty to
Constant Party under the terms of this Transaction, the obligations of
Constant Party hereunder shall be limited recourse obligations and Constant
Party agrees that it will not, prior to the date that is one year and one day
after the payment in full of all the Trust Notes (as defined in the Xxxxxxx,
Xxxxx & Co. Prospectus Supplement dated March 29, 2006), acquiesce, petition
or otherwise invoke or cause such permitted assigns to invoke the process of
any governmental authority for the purpose of commencing or sustaining a case
(whether voluntary or involuntary) against such permitted assign: under any
federal or state bankruptcy, insolvency or similar law or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of such permitted assigns or any substantial part of its
property or ordering the winding-up or liqu dation of the affairs of such
permitted assigns or making an assignment for the benefit of creditors.
Nothing contained herein shall prohibit Constant Party from submitting a claim
or proof o-: claim, in any proceeding or process instituted by or against such
permitted assigns.
5. Credit Support Documents: Standard Guaranty of The Xxxxxxx Sachs
Group, Inc.
5
6. Counterparty hereby agrees (a) to check this Confirmation (Reterenae No.:
NUUS6038W0 (920040000)) carefully and immediately upon receipt so that errors
or discrepanoles can be promptly identified and rectified and (b) to confirm
that the foregoing correctly sets forth the terms of the agroament between
QSCM, GSMtMDP and Gounterpartyr-with respect to the particular Transations to
which this G nfirmation relates, by manually signing this Confirmation and
p-Wding the othar' information requested herein aM Immediately ratuming an
executed copy to Swap Aclmkhlstra&f n. facsimile No. 212(.)902-M2.
Very truly yours,
XXXXXXX XXXXX CAPITAL MARKETS, L.P.
By: Xxxxxxx Sachs Capital Markets, L.L.G.
General Partner
By: _______________________________
Name:
Title:
Agreed and Accepted By:
XXXXXXX XXXXX MITSUI MARINE DERIVATIVE PRODUCTS, L.P.
By: GSMMDPGP, Inc.,
Gemeral Partner
By: _______________________________
Name:
Title:
Agreed and Accepted By:
Xxxxxxx Sachs Mortgage Company, L.P.
By: _______________________________
Name:
Title:
Agreed and Accepted By:
JPMorgan Chase Bank, National Association, not in its individual capacity, but
solely as Securities Administrator, on behalf of the GSAA Home Equity Trust
20006-5
By: _______________________________
Name:
Title:
Counterparty Reference No.: ________________________
6
Annex I
Schedule
For the Calculation Perod to but excluding** The applicable USD
------------------------- ------------------ ------------------
from and including;** Notional Amount shall be
--------------------- ------------------------
March 30, 2006 April 25, 2006 1,200,000,000.00
April 25, 2006 May 25, 2006 1,167,389,538.40
May 25, 2006 June 25, 2006 1,110,254,976.63
June 25, 2006 July 25, 2006 1,055,901,446.46
July 25, 2006 August 25, 2006 1,004,193,604.94
August 25, 2006 September 25, 2006 955,002,772.18
September 25, 2006 October 25, 2006 908,206,371.26
October 25, 2006 November 25, 2006 863,687,871.01
November 25, 2006 December 25, 2006 821,336,410.65
December 25, 2006 January 25, 2007 781,046,523.89
January 25, 2007 February 25, 2007 742,717,876.48
February 25, 2007 March 25, 2007 706,255,016.52
March 25, 2007 April 25, 2007 671,567,136.92
April 25, 2007 May 25, 2007 638,567,849.38
May 25, 2007 June 25, 2007 607,174,969.44
June 25, 2007 July 25, 2007 577,310,212.02
July 25, 2007 August 25, 2007 548,899,305.66
August 25, 2007 September 25, 2007 521,871,488.84
September 25, 2007 October 25, 2007 496,159,443.53
October 25, 2007 November 25, 2007 471,699,127.65
November 25, 2007 December 25, 2007 448,429,615.71
December 25, 2007 January 25, 2008 426,292,947.10
January 25, 2008 February 25, 2008 405,234,039.09
February 25, 2008 March 25, 2008 385,200,725.86
March 25, 2008 April 25, 2008 366,142,716.90
April 25, 2008 May 25, 2008 348,012,539.93
May 25, 2008 June 25, 2008 330,765,060.72
June 25, 2008 July 25, 2008 314,357,284.68
July 25, 2008 August 25, 2008 298,748,338.77
August 25, 2008 September 25, 2006 283,899,339.09
September 25, 2008 October 25, 2008 269,773,294.12
October 25, 2008 November 25, 2008 256,335,012.62
November 25, 2008 December 25, 2008 243,550,923.62
December 25, 2008 January 25, 2009 231,389,278.77
January 25, 2009 February 25, 2009 219,820,046.67
February 25, 2009 March 25, 2009 208,609,938.03
March 25, 2009 April 25, 2009 198,336,104.09
April 25, 2009 May 25, 2009 188,372,409.93
May 25, 2009 June 25, 2009 178,894,015.06
June 25, 2009 July 25, 2009 169,877,288.29
July 25, 2009 August 25, 2009 161,299,748.87
August 25, 2009 September 25, 2009 153,140,010.48
September 25, 200f(,) October 25, 2009 145,377,727.98
October 25, 2009 November 25, 2009 137,993,546.71
November 25, 2009 December 25, 2009 130,969,054.29
December 25, 2009 January 25, 2010 124,286,734.77
January 25, 2010 February 25, 2010 117,929,924.96
February 25, 2010 March 25, 2010 111,882,783.81
March 25, 2010 April 25, 2010 106,130,219.28
April 25, 2010 May 25, 2010 100,657,885.53
May 25, 2010 June 25, 2010 95,452,135.19
June 25, 2010 July 25, 2010 90,499,985.37
July 25, 2010 August 25, 2010 85,789,085.29
August 25, 2010 September 25, 2010 81,307,575.26
September 25, 2010 October 25, 2010 77,044,337.16
October 25, 2010 November 25, 2010 72,988,569.00
7
November 25, 2010 December 25, 2010 69,130,304.32
December 25, 2010 January 25, 2011 65,459,976.42
January 25, 2011 February 25, 2011 61,960,747.57
February 25, 2011 March 25, 2011 58,624,422.38
"Subject to adjustment in accordance with the Modified Following Business Day
Convention with respect to the Floating Rate Payer Payment obligations and not
subject to adjustment with respect to the Fixed Fate Payer Payment
obligations.
8
