ISDAâ International Swaps and Derivatives Association, Inc. MASTER AGREEMENT dated as of November 30, 2006
EXECUTION
(Multicurrency
- Cross Border)
ISDAâ
International
Swaps
and
Derivatives
Association, Inc.
MASTER
AGREEMENT
dated
as
of November
30, 2006
IXIS
FINANCIAL PRODUCTS INC.
|
and
|
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES
2006-BC4
|
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:
(a) Interpretation
(i) Definitions.
The
terms
defined in Section 14 and in the Schedule will have the meanings therein
specified for
the
purpose of this Master Agreement.
(ii) 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
purpose of the relevant Transaction.
(iii) 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.
(b)
|
Obligations
|
(i)
|
General
Conditions.
|
(A) 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.
(B) 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;
(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 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 organised 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.
(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 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 11, 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, organised, 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;
(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:—
(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
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 (1) 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 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.
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.
(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 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. 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 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 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.
(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 be entered into as soon as practicable and may be 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 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.
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;
(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
finding 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 organised, 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.
“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 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, organised, 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 —
(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.
“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.
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.
IXIS
FINANCIAL PRODUCTS INC.
|
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES
2006-BC4
|
|
(Name
of Party)
|
(Name
of Party)
|
|
By:
Xxxxx Fargo Bank, N.A., not in its individual capacity, but solely
as
Securities Administrator
|
||
/s/ Xxxxxxx X. Xxxxxx | /s/ Xxxxxxx Xxxxxx | |
Name:
Xxxxxxx X. Xxxxxx
|
Name:
Xxxxxxx Xxxxxx
|
|
Title:
Managing Director
|
Title:
Vice President
|
|
Date:
|
Date:
11/30/06
|
|
/s/ Xxxxxxxxxxx Xxxxxx | ||
Name:
Xxxxxxxxxxx Xxxxxx
|
||
Title:
Managing Director
|
||
Date:
|
Rate
Swap Schedule
SCHEDULE
to
the
Master
Agreement
dated
as
of November
30, 2006
between
IXIS
FINANCIAL PRODUCTS INC.
|
and
|
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES
2006-BC4
|
_______________________________________
(“Party
A”)
|
_________________________________________
(“Party
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”
will not apply to Party A or to Party
B.
|
(c)
|
Certain
Events of Default.
The following Events of Default will apply to the parties as specified
below, and the definition of “Event of Default” in Section 14 is deemed to
be modified accordingly:
|
Section
5(a)(i) (Failure
to Pay or Deliver) will apply to Party A and Party B; provided, however,
that
Section 5(a)(i) is hereby amended by replacing the word “third” with the word
“first.”
2
Section
5(a)(ii) (Breach
of Agreement)
will
apply to Party A and will not apply to Party B; except that Section 5(a)(ii)
will not apply to Party A with respect to Party A’s failure to comply with Part
5(b)(i), Part 5(b)(ii) or Part 5(b)(iii) herein.
Section
5(a)(iii) (Credit
Support Default)
will
apply to Party A and will not apply to Party B; except that Section 5(a)(iii)(1)
will apply in respect of Party B’s obligations under Paragraph 3(b) of any
Credit Support Document.
Section
5(a)(iv) (Misrepresentation)
will
apply to Party A and will not apply to Party B.
Section
5(a)(v) (Default
under Specified Transaction)
will
not apply to Party A or Party B.
Section
5(a)(vi) (Cross
Default)
will
not apply to Party B and will apply to Party A with a Threshold Amount equal
to
three percent of the applicable Relevant Entity’s Shareholders’ Equity
(excluding deposits).
“Relevant
Entity”
means Party A and any guarantor under an Eligible Guarantee in respect of
all of
Party A’s present and future obligations under this Agreement.
Section
5(a)(vii) (Bankruptcy)
will
apply to Party A and Party B; provided
that
clauses (2), (7) and (9) thereof shall not apply to Party B; provided
further
that clause (4) thereof shall not apply to Party B with respect to proceedings
or petitions instituted or presented by Party A or any Affiliate of Party
A;
provided
further
that clause (6) shall not apply to Party B to the extent that it refers to
(i)
any appointment that is contemplated or effected by the Trust Agreement (as
defined below) or (ii) any appointment to which Party B has not become subject;
and provided
further
that clause (8) shall not apply to Party B to the extent that clause (8)
relates
to clauses (2), (4), (6) and (7) (except to the extent that such provisions
are
not disapplied to Party B).
Section
5(a)(viii) (Merger
without Assumption)
will
apply to Party A and Party B.
Notwithstanding
Sections 5(a)(i) and 5(a)(iii) of this Agreement, any failure by Party A
to
comply with or perform any obligation to be complied with or performed by
Party
A under the Credit Support Document shall not be an Event of Default unless
(A)
(i) the Second
Rating Trigger Requirements
apply and at
least 30 Local Business Days have elapsed since the last time the Second
Rating
Trigger Requirements did not apply and (ii) such
failure is not remedied on or before the third Local Business Day after notice
of such failure is given to Party A,
or (B) (i) a Ratings Event has occurred and is continuing and at least 10
Local
Business Days (or 30 calendar days, in the case of Fitch) have elapsed the
since
the date a Ratings Event occurred and (ii) such failure is not remedied on
or
before the third Local Business Day after notice of such failure is given
to
Party A.
(d)
|
Termination
Events.
The following Termination Events will apply to the parties as specified
below:
|
Section
5(b)(i) (Illegality)
will
apply to Party A and Party B.
Section
5(b)(ii) (Tax
Event)
will
apply to Party A and Party B; provided
that
Section
5(b)(ii) shall be amended by deleting the
words
“(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).”
3
Section
5(b)(iii) (Tax
Event upon Merger)
will
apply to Party A and Party B; provided
that
Party A shall not be entitled to designate an Early Termination Date by reason
of a Tax Event upon Merger in respect of which it is the Affected
Party.
Section
5(b)(iv) (Credit
Event upon Merger)
will
not apply to Party A or Party B.
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) of this Agreement will not apply to Party
A or
Party B.
|
(f)
|
The
“Transfer
to Avoid Termination Event”
provision of Section 6(b)(ii) shall be amended
by deleting the
words “or if a Tax Event upon Merger occurs and the Burdened Party is
the
Affected Party.”
|
(g)
|
Payments
on Early Termination.
For the purpose of Section 6(e) of this
Agreement:
|
(i)
|
Market
Quotation will apply.
|
(ii)
|
The
Second Method will apply.
|
(h)
|
“Termination
Currency”
means United States Dollars.
|
(i)
|
Timing
of Party B Termination Payment.
If an amount calculated as being due in respect of an Early Termination
Date under Section 6(e) of this Agreement is an amount to be paid
by Party
B to Party A then, notwithstanding the provisions of Section 6(d)(ii)
of
this Agreement, such amount will be payable on the Business Day
immediately preceding the first Distribution Date following the
date on
which the payment would have been payable as determined in accordance
with
Section 6(d)(ii); provided
that if the date on which the payment would have been payable as
determined in accordance with Section 6(d)(ii) is a Distribution
Date,
then the payment will be payable on the date determined in accordance
with
Section 6(d)(ii).
|
(j)
|
Additional
Termination Events.
The following Additional Termination Events will apply, in each
case with
respect to Party A as the sole Affected Party (unless otherwise
provided
below):
|
(i)
|
First
Rating Trigger Collateral.
Party A has failed to comply with or perform any obligation to
be complied
with or performed by Party A in accordance with the Credit Support
Document and either (A) the Second Rating Trigger Requirements
do not
apply or (B) less than 30 Local Business Days have elapsed since
the last time the Second Rating Trigger Requirements (as defined
below)
did not
apply.
|
(ii)
|
Second
Rating Trigger Replacement.
(A) The Second Rating Trigger Requirements apply and 30 or more
Local
Business Days have elapsed since the last time the Second Rating
Trigger
Requirements did not apply and (B) (i) at least one Eligible Replacement
has made a Firm Offer (which remains capable of becoming legally
binding
upon acceptance) to be the transferee of a transfer to be made
in
accordance with Part 5(f)(ii) below and/or (ii) at least one entity
with
the First Trigger Required Ratings and/or the Second Trigger Required
Ratings has made a Firm Offer (which remains capable of becoming
legally
binding upon acceptance by the offeree) to provide an Eligible
Guarantee
in respect of all of Party A’s present and future obligations under this
Agreement.
|
The
“Second
Rating Trigger Requirements”
applies
when no Relevant Entity has credit ratings at least equal to the Second Trigger
Required Ratings.
4
“Firm
Offer”
means an
offer which, when made, was capable of becoming legally binding upon
acceptance.
(iii)
|
Ratings
Event.
Party A fails to comply with the downgrade provisions as set forth
in Part
5(b)(iii), after giving effect to all grace or cure periods therein,
and
(i) at least one Eligible Replacement has made a Firm Offer (which
remains
capable of becoming legally binding upon acceptance) to be the
transferee
of a transfer to be made in accordance with Part 5(f)(ii) below
and/or
(ii) at least one entity with the Hedge Counterparty Ratings Requirement
has made a Firm Offer (which remains capable of becoming legally
binding
upon acceptance by the offeree) to provide an Eligible Guarantee
in
respect of all of Party A’s present and future obligations under this
Agreement.
|
(k)
|
The
following Additional Termination Events will apply, in each case
with
respect to Party B as the sole Affected Party (unless otherwise
provided
below):
|
(i)
|
Party
B or the Trust Fund (as defined in the Trust Agreement, dated as
of
November 1, 2006, among Structured Asset Securities Corporation,
a
Delaware corporation, as depositor, Xxxxx Fargo Bank, N.A., as
master
servicer and securities administrator (the “Securities Administrator”),
Xxxxxxx Fixed Income Services Inc., as credit risk manager, and
U.S. Bank
National Association, as trustee (the “Trust
Agreement”))
is terminated.
|
(ii)
|
The
Trust Agreement is amended or modified without the prior written
consent
of Party A where such consent is required under the terms of the
Trust
Agreement, or such amendment or modification has a materially adverse
effect on Party A; provided,
however,
that it shall not be an Additional Termination Event where such
amendment
or modification involves the appointment of any successor trustee,
securities administrator, master servicer or servicer pursuant
to the
terms of the Trust Agreement.
|
(iii)
|
The
Class Principal Amounts of the rated Certificates are reduced to
zero.
|
(iv)
|
Notice
of the Master Servicer’s intention
(either voluntarily or as caused by the NIMS Insurer) to exercise
its
option to purchase the Mortgage Loans pursuant to Section 7.01
of the
Trust Agreement is given by the Securities Administrator to
Certificateholders pursuant to Section 7.02 of the Trust Agreement,
provided
that the Early Termination Date may not be earlier than the date
on which
the Certificates are redeemed pursuant to Section 7.02 of the Trust
Agreement.
|
Notwithstanding
anything in Section 6 of this
Agreement to the contrary, any amounts due as result of the occurrence of
an
Additional Termination Event described in Part 1(k)(i) and Part 1(k)(iv) of
this Schedule may be calculated prior to the Early Termination Date and shall
be
payable on the Early Termination Date.
5
Part
2
Representations.
(a)
|
Payer
Tax Representations.
For the purpose of Section 3(e) of this Agreement, Party A and
Party B
will make the following representations:
None.
|
(b)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party B
shall not
be required to pay any additional amounts referred to
therein.
|
(c)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
(d)
|
Payee
Representations.
For the purpose of Section 3(f) of this Agreement, Party A and
Party B
make the representations specified below, if
any:
|
(i)
|
Party
A makes the following
representation(s):
|
Party
A represents that is a corporation organized under the laws of the State
of
Delaware.
(ii)
|
Party
B makes the following
representation(s):
|
None.
6
Part
3
Agreement
to Deliver Documents.
For
the
purpose of Sections 4(a)(i) and (ii) of this Agreement, each party agrees
to
deliver the following documents, as applicable:
(a)
|
Tax
forms, documents or certificates to be delivered
are:—
|
Party
required to deliver document
|
Form/Document/Certificate
|
Date
by which to be delivered
|
||
Party
A and Party B
|
Subject
to Section 4(a)(iii), any document required or reasonably requested
to
allow the other party to make payments under this Agreement without
any
deduction or withholding on account of any Tax.
|
(i)
promptly upon reasonable demand by Party B and (ii) promptly upon
learning
that any such Form previously provided by Party A has become obsolete
or
incorrect.
|
(b)
|
Other
documents to be delivered are:—
|
Party
required to deliver document
|
Form/Document/Certificate
|
Date
by which to be delivered
|
Covered
by §3(d) Representation
|
|||
Party
B
|
Certified
copy of the Board of Directors resolution (or equivalent authorizing
documentation) which sets forth the authority of each signatory
to this
Agreement and each Credit Support Document (if any) signing on
its behalf
and the authority of such party to enter into Transactions contemplated
and performance of its obligations hereunder.
|
Concurrently
with the execution and delivery of this Agreement.
|
Yes
|
|||
Party
A and Party B
|
Incumbency
Certificate (or, if available the current authorized signature
book or
equivalent authorizing documentation) specifying the names, titles,
authority and specimen signatures of the persons authorized to
execute
this Agreement which sets forth the specimen signatures of each
signatory
to this Agreement, each Confirmation and each Credit Support Document
(if
any) signing on its behalf.
|
Concurrently
with the execution and delivery of this Agreement unless previously
delivered and still in full force and effect.
|
Yes
|
|||
Party
A and Party B
|
An
executed copy of the Disclosure Agreement relating to the Preliminary
Prospectus Supplement or Free Writing Prospectus, as applicable
(each as
defined in the Trust Agreement).
|
On
the date of such Preliminary Prospectus Supplement
or
Free Writing Prospectus, as applicable.
|
Yes
|
7
Party
required to deliver document
|
Form/Document/Certificate
|
Date
by which to be delivered
|
Covered
by §3(d) Representation
|
Party
A and B
|
An
executed copy of the Disclosure Agreement relating to the Prospectus
Supplement (as defined in the Trust Agreement).
|
On
the date of such Prospectus Supplement.
|
Yes
|
|||
Party
A and B
|
An
opinion of counsel to such party reasonably satisfactory in form
and
substance to the other party, and, in the case of Party B, opinions
of
counsel relating to the Trust Agreement and other deal documents
reasonably satisfactory in form and substance to Party A.
|
Concurrently
with the execution and delivery of the Confirmation unless previously
delivered and still in full force and effect.
|
No
|
|||
Party
A
|
A
copy of the guaranty provided by the Credit Support Provider, if
applicable.
|
Concurrently
with the execution and delivery of the Confirmation unless previously
delivered and still in full force and effect.
|
Yes
|
|||
Party
A
|
An
opinion of counsel to such party relating to the enforceability
of the
guaranty reasonably satisfactory in form and substance to Party
B, if
applicable.
|
Concurrently
with the execution and delivery of the Confirmation unless previously
delivered and still in full force and effect.
|
No
|
|||
Party
B
|
An
executed copy of the Trust Agreement and other deal documents related
to
this Transaction.
|
Within
30 days after the date of this Agreement.
|
No
|
|||
Party
B
|
Each
material amendment, supplement or waiver of the Trust Agreement,
as
proposed from time to time, or any other amendment or modification
of the
Trust Agreement that requires the written consent of Party A under
the
terms of the Trust Agreement.
|
Promptly
upon learning of any proposed amendment, supplement or
waiver.
|
No
|
8
Part
4.
Miscellaneous.
(a)
|
Addresses
for Notices.
For the purposes of Section 12(a) of this
Agreement:
|
(i)
|
Addresses
for notices or communications to Party
A:
|
(1)
|
For
all purposes under this Agreement:
|
IXIS
Financial Products Inc.
Harborside
Financial Xxxxxx
Xxxxx
X,
00xx
Xxxxx
Xxxxxx
Xxxx, XX 00000
Attention:
Swaps Administration
Facsimile
No: (000) 000-0000
Telephone
No: (000) 000-0000
Electronic
Messaging System Details: xxxxxxxxxxxxxxxxxxxxx@xxxxxx.xxx
With
a
copy to:
IXIS
Financial Products Inc.
0
Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
General Counsel
Telephone
No.: 000 000 0000
Facsimile:
000 000 0000
(ii)
|
Addresses
for notices or communications to Party
B:
|
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000-0000
Attention:
Client
Manager - SASCO 2006-BC4
Telephone:
(000)
000-0000
Fax:
(000)
000-0000
(b)
|
Process
Agent.
For the purposes of Section 13(c) of this
Agreement:
|
Party
A appoints as its Process Agent: Not applicable
Party
B
appoints as its Process Agent: Not applicable.
(c)
|
Offices.
The provisions of Section 10(a) will not apply to this
Agreement.
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
9
Party
B
is not a Multibranch Party.
(e)
|
Calculation
Agent.
The Calculation Agent is Party A.
|
(f)
|
Credit
Support Document.
Credit Support Document means the credit support annex entered
into
between Party A and Party B in relation to this Agreement, and
with
respect to Party A, (i) with respect to Transactions entered into
with a
Trade Date on or before January 23, 2007 and a final stated termination
date on or before January 23, 2017, the guarantee of the obligations
of
Party A by IXIS Corporate & Investment Bank (as successor-in-interest
to CDC Finance-CDC IXIS) dated as of October 23, 2003 with recourse,
according to the terms thereof, to Caisse des Dépôts et Consignations, and
(ii) with respect to Transactions entered into with a Trade Date
either
(x) on or before January 23, 2007 and a final stated termination
date
after January 23, 2017 or (y) after January 23, 2007 regardless
of the
final stated termination date, the guarantee of the obligations of
Party A by IXIS Corporate & Investment Bank dated as of November 1,
2004 without recourse to Caisse des Dépôts et Consignations.
|
(g)
|
Credit
Support Provider.
Credit Support Provider means in relation to Party A, (1) Party
A in its
capacity as a party to the Credit Support Document and (2) IXIS
Corporate
& Investment Bank, a limited liability company with executive and
supervisory boards (société anonyme à Directoire et Conseil de
Surveillance) organized under the laws of the Republic of France,
and in
relation to Party B, Party B in its capacity as a party to the
Credit
Support Document.
|
(h)
|
(i)
|
Netting
of Payments.
Subparagraph (ii) of Section 2(c) of this Agreement will apply
to all
Transactions (in each case starting from the date of this
Agreement).
|
(j)
|
“Affiliate”
will have the meaning specified in Section 14 of this Agreement,
provided
that Party B shall be deemed to have no
Affiliates.
|
(k)
|
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.
|
(l)
|
Waiver
of Jury Trial.
Each party waives, to the fullest extent permitted by applicable
law, any
right it may have to a trial by jury in respect of any suit, action
or
proceeding relating to this Agreement or any Credit Support Document.
Each
party certifies (i) that no representative, agent or attorney of
the other
party or any Credit Support Provider has represented, expressly
or
otherwise, that such other party would not, in the event of such
a suit,
action or proceeding, seek to enforce the foregoing waiver and
(ii)
acknowledges that it and the other party have been induced to enter
into
this Agreement and provide for any Credit Support Document, as
applicable,
by, among other things, the mutual waivers and certifications in
this
Section.
|
(m)
|
Consent
to Recording.
Each party consents to the recording of the telephone conversations
of
trading and marketing personnel of the parties and their Affiliates
in
connection with this Agreement or any potential
transaction.
|
(n)
|
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
illegal, 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 illegal, 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.
|
10
(o)
|
Single
Agreement.
Section 1(c) shall be amended by adding the words “, the credit support
annex entered into between Party A and Party B in relation to this
Agreement” after the words “Master Agreement;” provided,
that Section 5(a)(ii) shall not apply to the Credit Support
Document.
|
(p)
|
Local
Business Day.
The definition of Local Business Day in Section 14 of this Agreement
shall
be amended by the addition of the words “or any Credit Support Document”
after “Section 2(a)(i)” and the addition of the words “or Credit Support
Document” after “Confirmation.”
|
11
Part
5.
Other
Provisions.
(a)
|
Definitions.
|
This
Agreement, including each Confirmation and each Swap Transaction, is subject
to
the 2000 ISDA Definitions, as amended, supplemented, updated, and superseded
from time to time (the “Definitions”), as published by the International Swaps
and Derivatives Association, Inc. (“ISDA”) and will be governed in all respects
by the Definitions (except that references to “Swap Transactions” shall be
deemed to be references to “Transactions”). The Definitions are incorporated by
reference in, and made part of, this Agreement and each Confirmation as if
set
forth in full in this Agreement and such Confirmations. In the event of any
inconsistency between the provisions of this Agreement and the Definitions,
this
Agreement will prevail (and, in the event of any inconsistency between any
Confirmation and the Definitions, the Confirmation will control). Any reference
in a Confirmation to any Definitions which are amended or supplemented in
this
Schedule shall be deemed to be a reference to such Definitions as so amended
or
supplemented, unless the Confirmation states, by specific reference to any
such
amendment or supplement, that such amendment or supplement will not apply
in
respect of the Transaction to which such Confirmation relates.
(b) |
Downgrade
Provisions.
|
(i)
|
Second
Trigger Failure Condition.
So long as the Second Rating Trigger Requirements apply, Party A
shall, at its own expense use commercially reasonable efforts,
as soon as
reasonably practicable, to either (i) furnish an Eligible Guarantee
of
Party A’s obligations under this Agreement from a guarantor that maintains
the First Trigger Required Ratings and/or the Second Trigger Required
Ratings or (ii) obtain an Eligible Replacement pursuant to Part
5(f) below
that assumes the obligations of Party A under this Agreement (through
a novation or other assignment and assumption agreement in form
and
substance reasonably satisfactory to Party B) or replaces the
outstanding Transactions hereunder with transactions on identical
terms,
except that Party A shall be replaced as
counterparty.
|
(ii)
|
Collateralization
Event.
It shall be a collateralization event (“Collateralization Event”) if (A)
either (i) the unsecured, short-term debt obligations of the Relevant
Entity are rated below “A-1” by Standard & Poor’s Rating Services, a
division of The XxXxxx-Xxxx Companies, Inc. (“S&P”) or (ii) if the
Relevant Entity does not have a short-term rating from S&P, the
unsecured, long-term senior debt obligations of a Relevant Entity
are
rated below “A+” by S&P, or (B) the unsecured, long-term senior debt
obligations or financial strength ratings of the Relevant Entity
are rated
below “A” by Fitch, Inc. (“Fitch”). For the avoidance of doubt, the
parties hereby acknowledge and agree that notwithstanding the occurrence
of a Collateralization Event, this Agreement and each Transaction
hereunder shall continue to be a Swap Agreement for purposes of
the Trust
Agreement. Within 30 calendar days from the date a Collateralization
Event
has occurred and so long as such Collateralization Event is continuing,
Party A shall, at its sole expense, either (i) post collateral in an
amount required to be posted pursuant to terms of the Credit Support
Document (such amount which is the greater of amounts required
to be
posted by Xxxxx’x, S&P and Fitch), (ii)
upon satisfaction of the Rating Agency Condition, furnish an Eligible
Guarantee of Party A’s obligations under this Agreement from a guarantor
that satisfies the Hedge Counterparty Ratings Requirement or (iii)
obtain
an Eligible Replacement that (x) upon satisfaction of the Rating
Agency
Condition (as defined below), assumes the obligations of Party A
under this Agreement (through an assignment and assumption agreement
in
form and substance reasonably satisfactory to Party B) or (y) having
provided prior written notice to S&P and Fitch, replaces the
outstanding Transactions hereunder with transactions on identical
terms,
except that Party A shall be replaced as counterparty; provided
that such Eligible
Replacement,
as of the date of such assumption or replacement, will not, as
a result
thereof, be required to withhold or deduct on account of tax under
the
Agreement or the new Transactions, as applicable, and such assumption
or
replacement will not lead to a Termination Event or Event of Default
occurring under the Agreement or new Transactions, as
applicable.
|
12
“Rating
Agency Condition”
shall
mean first receiving prior written confirmation from S&P and Fitch that
their then-current ratings of the rated Certificates will not be downgraded
or
withdrawn by such Rating Agency.
(iii)
|
Ratings
Event.
It shall be a ratings event (“Ratings Event”) if at any time after the
date hereof, the Relevant Entity shall fail to satisfy the Hedge
Counterparty Ratings Threshold or the Relevant Entity is no longer
rated
by S&P. Within 30 calendar days (or, in the case of a failure to meet
the requirements of subparagraph (a) of the definition of “Hedge
Counterparty Ratings Threshold”, within 10 Local Business Days) from the
date a Ratings Event has occurred and so long as such Ratings Event
is
continuing, Party A shall, at its sole expense, (i) obtain an
Eligible Replacement that (x) upon satisfaction of the Rating Agency
Condition, assumes the obligations of Party A under this Agreement
(through an assignment and assumption agreement in form and substance
reasonably satisfactory to Party B) or (y) having provided prior
written notice to S&P and Fitch, replaces the outstanding Transactions
hereunder with transactions on identical terms, except that Party A
shall be replaced as counterparty; provided
that such Eligible Replacement, as of the date of such assumption
or
replacement, will not, as a result thereof, be required to withhold
or
deduct on account of tax under the Agreement or the new Transactions,
as
applicable, and such assumption or replacement will not lead to
a
Termination Event or Event of Default occurring under the Agreement
or new
Transactions, as applicable, or (ii) upon satisfaction of the Rating
Agency Condition, furnish an Eligible Guarantee of Party A’s obligations
under this Agreement from a guarantor that satisfies the Hedge
Counterparty Ratings Requirement and
(iii) upon the occurrence of a Ratings Event, Party A shall immediately
be
required to post collateral in an amount required to be posted
pursuant to
terms of the Credit Support Document (such amount which is the
greater of
amounts required to be posted by Xxxxx’x, S&P and Fitch).
|
(iv)
|
Downgrade
Definitions.
|
(A)
|
“Eligible
Guarantee”
means an unconditional and irrevocable guarantee that is provided
by a
guarantor as principal debtor rather than surety and is directly
enforceable by Party B, where either (A) a law firm has given a
legal
opinion confirming that none of the guarantor’s payments to Party B under
such guarantee will be subject to withholding for Tax or (B) such
guarantee provides that, in the event that any of such guarantor’s
payments to Party B are subject to withholding for Tax, such guarantor
is
required to pay such additional amount as is necessary to ensure
that the
net amount actually received by Party B (free and clear of any
withholding
tax) will equal the full amount Party B would have received had
no such
withholding been required.
|
(B)
|
“Eligible
Replacement”
means a Transferee (as defined in Part 5(f)(ii) herein) (i) (A)
with the
First Trigger Required Ratings and/or the Second Trigger Required
Ratings
or (B) whose present and future obligations owing to Party B are
guaranteed pursuant to an Eligible Guarantee provided by a guarantor
with
the First Trigger Required Ratings and/or the Second Trigger Required
Ratings and (ii) with the ratings specified in the definition of
Hedge
Counterparty Ratings Requirement below; provided
that no entity shall be an Eligible Replacement unless (A) a legal
opinion
is given by a law firm confirming that none of such entity’s payments to
Party B under this Agreement or its replacement (as applicable)
will be
subject to deduction or withholding for Tax or (B) in the event
that any
of such entity’s payments to Party B are subject to withholding for Tax,
such Eligible Replacement is required to pay such additional amount
as is
necessary to ensure that the net amount actually received by Party
B (free
and clear of any withholding tax) will equal the full amount Party
B would
have received had no such withholding been
required.
|
13
(C)
|
“First
Trigger Required Ratings”
means with respect to an entity, either (i) where the entity is
the
subject of a Moody’s Short-term Rating, such entity’s Moody’s Short-term
Rating is “Prime-1” and the entity’s long-term, unsecured and
unsubordinated debt or counterparty obligations are rated “A2” or above by
Moody’s or (ii) where the entity is not the subject of a Moody’s
Short-term Rating, its long-term, unsecured and unsubordinated
debt or
counterparty obligations are rated “A1” or above by
Moody’s.
|
(D)
|
“Hedge
Counterparty Ratings Threshold”
means, with respect to S&P, (a) the unsecured, long-term senior debt
obligations of Party A (or its Credit Support Provider) are rated at
least “BBB-” by S&P, and with respect to Fitch, (b) either (i) the
unsecured, senior debt obligations or financial strength ratings
of
Party A (or its Credit Support Provider), are rated at least “BBB+”
by Fitch or (ii) the unsecured, short-term debt obligations (if
any) of
Party A , are rated at least “F2” by Fitch. For the avoidance of all
doubts, the parties hereby acknowledge and agree that notwithstanding
the
occurrence of a Ratings Event, this Agreement and each Transaction
hereunder shall continue to be a Swap Agreement for purposes of
the Trust
Agreement.
|
(E)
|
“Hedge
Counterparty Ratings Requirement”
means (a) either (i) the unsecured, short-term debt obligations
of the
substitute counterparty (or its Credit Support Provider) are rated
at
least “A-1” by S&P or (ii) if the substitute counterparty does not
have a short-term rating from S&P, the unsecured, long-term senior
debt obligations of the substitute counterparty (or its Credit
Support
Provider) are rated at least “A+” by S&P, and (b) either (i) the
unsecured, long-term senior debt obligations of such substitute
counterparty (or its Credit Support Provider) are rated at least
“A” by
Fitch or (ii) the unsecured, short-term debt obligations of such
substitute counterparty (or its Credit Support Provider) are rated
at
least “F1” by Fitch. For the purpose of this definition, no direct or
indirect recourse against one or more shareholders of the substitute
counterparty (or against any Person in control of, or controlled
by, or
under common control with, any such shareholder) shall be deemed
to
constitute a guarantee, security or support of the obligations
of the
substitute counterparty.
|
(F)
|
“Moody’s”
means Xxxxx'x Investors Service,
Inc.
|
(G)
|
“Moody’s
Short-term Rating”
means a rating assigned by Moody’s under its short-term rating scale in
respect of an entity’s short-term, unsecured and unsubordinated debt
obligations.
|
(H)
|
A
“Second
Trigger Failure Condition”
occurs at any time no Relevant Entity maintains the Second Trigger
Required Ratings.
|
(I)
|
“Second
Trigger Required Ratings”
means with respect to an entity (A) either where the entity is
the subject
of a Moody’s Short-term Rating, such entity’s Moody’s Short-term Rating is
“Prime-2” or above and its long-term, unsecured and unsubordinated debt or
counterparty obligations are rated “A3” or above by Moody’s, and (B) where
such entity is not the subject of a Moody’s Short-term Rating, if the
entity’s long-term, unsecured and unsubordinated debt or counterparty
obligations are rated “A3” or above by
Moody’s.
|
14
(c)
|
Additional
Representations.
|
Section
3(a) of this Agreement is hereby amended to include the following additional
representations after paragraph 3(a)(v):
(i)
|
Eligible
Contract Participant.
It is an “eligible contract participant” as defined in the U.S. Commodity
Exchange Act.
|
(ii)
|
Individual
Negotiation.
This Agreement and each Transaction hereunder is subject to individual
negotiation by the parties.
|
(iii)
|
Relationship
between Party A and Party B.
Each of Party A and Party B will be deemed to represent to the
other on
the date on which it enters into a Transaction or an amendment
thereof
that (absent a written agreement between Party A and Party B that
expressly imposes affirmative obligations to the contrary for that
Transaction):
|
(A)
|
Principal.
Party A is acting as principal and not as agent when entering into
this
Agreement and each Transaction. Party B is acting not in its individual
capacity but solely as Securities Administrator on behalf of the
Supplemental Interest Trust, Structured Asset Securities Corporation
Mortgage Pass-Through Certificates, Series
2006-BC4.
|
(B)
|
Non-Reliance.
Party A is acting for its own account and 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 advisors as it has deemed necessary.
Party B is
acting not in its individual capacity but solely as Securities
Administrator on behalf of the Supplemental Interest Trust, Structured
Asset Securities Corporation Mortgage Pass-Through Certificates,
Series
2006-BC4. 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.
|
(C)
|
Evaluation
and Understanding.
It is capable of evaluating and understanding (on its own behalf
or
through independent professional advice), and understands and accepts,
the
terms, conditions and risks of this Agreement and each Transaction
hereunder. It is also capable of assuming, and assumes, all financial
and
other risks of this Agreement and each Transaction
hereunder.
|
(D)
|
Status
of Parties.
The other party is not acting as a fiduciary or an advisor for
it in
respect of that Transaction.
|
(d)
|
Section
4 is hereby amended by adding the following new agreement:
|
Actions
Affecting Representations.
Party B
agrees not to take any action during the term of this Agreement or any
Transaction hereunder that renders or could render any of the representations
and warranties in this Agreement untrue, incorrect, or incomplete, and if
any
event or condition occurs that renders or could render any such representation
untrue, incorrect, or incomplete, Party B will immediately give written notice
thereof to Party A.
15
(e)
|
Section
1(c).
For purposes of Section 1(c) of the Agreement, the Transaction
evidenced
by Confirmation with Reference ID: 368705CF, dated 368707CF, 2006,
between
Party A and Party B, as amended from time to time, shall be the
sole
Transaction under the Agreement.
|
(f)
|
Transfer.
|
(i)
|
Section
7 of this Agreement shall not apply to Party A and, subject to
Section
6(b)(ii) (provided that to the extent Party A makes a transfer
pursuant to
Section 6(b)(ii) it will provide a prior written notice to the
Rating
Agencies of such transfer) and Part 5(f)(ii) below, Party A may
not
transfer (whether by way of security or otherwise) any interest
or
obligation in or under this Agreement without first satisfying
the Rating
Agency Condition and without the prior written consent of Party
B.
|
(ii)
|
Subject
to Part 5(o) below, Party A may (at its own cost) transfer all
or
substantially all of its rights and obligations with respect to
this
Agreement to any other entity (a “Transferee”)
that is an Eligible Replacement through a novation or other assignment
and
assumption agreement or similar agreement in form and substance
reasonably
satisfactory to Party B; provided that (A) Party B shall determine in
its sole discretion, acting in a commercially reasonable manner,
whether
or not a transfer relates to all or substantially all of Party
A’s rights
and obligations under this Agreement, (B) as of the date of such
transfer
the Transferee will not be required to withhold or deduct on account
of a
Tax from any payments under this Agreement unless the Transferee
will be
required to make payments of additional amounts pursuant to Section
2(d)(i)(4) of this Agreement in respect of such Tax, (C) a Termination
Event or Event of Default does not occur under this Agreement as
a result
of such transfer and (D) Party A receives confirmation from each
Rating
Agency (other than Moody’s) that transfer to the Transferee does not
violate the Rating Agency Condition. Following such transfer, all
references to Party A shall be deemed to be references to the
Transferee.
|
(iii)
|
If
an entity has made a Firm Offer (which remains capable of becoming
legally
binding upon acceptance) to be the transferee of a transfer to
be made in
accordance with Part 5(f)(ii) above, Party B shall (at Party A’s cost) at
Party A’s written request, take any reasonable steps required to be taken
by it to effect such transfer.
|
(iv)
|
Except
as specified otherwise in the documentation evidencing a transfer,
a
transfer of all the obligations of Party A made in compliance with
this
Part 5(f) 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.
|
(g)
|
Capacity
of the Securities Administrator. It
is expressly understood and agreed by the parties hereto that (i)
this
Agreement is executed and delivered by Xxxxx Fargo Bank, N.A. not
individually or personally but solely as securities administrator
of the
Supplemental Interest Trust, Structured Asset Securities Corporation
Mortgage Pass-Through Certificates, Series 2006-BC4, (ii) each
of the
representations, undertakings and agreements herein made on the
part of
the Supplemental Interest Trust, Structured Asset Securities Corporation
Mortgage Pass-Through Certificates, Series 2006-BC4 is made and
intended
not as personal representations, undertakings and agreements by
Xxxxx
Fargo Bank, N.A. but is made and intended for the purpose of binding
only
the Supplemental Interest Trust, Structured Asset Securities Corporation
Mortgage Pass-Through Certificates, Series 2006-BC4, (iii) nothing
herein
contained shall be construed as creating any liability on the part
of
Xxxxx Fargo Bank, N.A., individually or personally, to perform
any
covenant either expressed or implied contained herein, all such
liability,
if any, being expressly waived by the parties hereto and by any
Person
claiming by, through or under the parties hereto and (iv) under
no
circumstances shall Xxxxx Fargo Bank, N.A. be personally liable
for the
payment of any indebtedness or expenses of the Trust or be liable
for the
breach or failure of any obligation, representation, warranty or
covenant
made or undertaken by the Supplemental Interest Trust, Structured
Asset
Securities Corporation Mortgage Pass-Through Certificates, Series
2006-BC4
under this Agreement.
|
16
(h)
|
Proceedings.
Without impairing any right afforded to it under the Trust Agreement
as a
third party beneficiary, Party A shall not institute against or
cause any
other person to institute against, or join any other person in
instituting
against the Structured Asset Securities Corporation Trust Fund
any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any federal or state bankruptcy,
dissolution or similar law, for a period of one year and one day
following
indefeasible payment in full of the Certificates.
Nothing shall preclude, or be deemed to stop, Party A (i) from
taking any
action prior to the expiration of the aforementioned one year and
one day
period, or if longer the applicable preference period then in effect,
in
(A) any case or proceeding voluntarily filed or commenced by Party
B or
(B) any involuntary insolvency proceeding filed or commenced by
a Person
other than Party A, or (ii) from commencing against Party B or
any of the
Collateral any legal action which is not a bankruptcy, reorganization,
arrangement, insolvency, moratorium, liquidation or similar
proceeding.
|
(i)
|
Amendments
to Events of Default.
The “Failure to Pay or Deliver” provision in Section 5(a)(i) of the
Agreement is hereby amended by deleting the word “third” in the third line
thereof and inserting the word “first” in place
thereof.
|
(j)
|
Change
of Account.
Section 2(b) of this Agreement is hereby amended by the addition
of the
words “to another account in the same legal and tax jurisdiction as the
original account” following the word “delivery” in the first line
thereof.
|
(k)
|
Trust
Agreement.
|
(i)
|
Capitalized
terms used in this Agreement that are not defined herein and are
defined
in the Trust Agreement shall have the respective meanings assigned
to them
in the Trust Agreement.
|
(ii)
|
Party
B will provide at least ten days’ prior written notice to Party A of any
proposed amendment or modification to the Trust
Agreement.
|
(l) No
Set-off.
(i)
|
All
payments under this Agreement shall be made without set-off or
counterclaim, except as expressly provided for in Section 2(c),
Section 6
or Part 5(q)(vi) below and paragraphs 8(a) and 8(b) of the Credit
Support
Document.
|
(ii)
|
Section
6(e) shall be amended by the deletion of the following sentence:
“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.”
|
17
(m)
|
Notice
of Certain Events or Circumstances.
Each party agrees, upon learning of the occurrence or existence
of any
event or condition that constitutes (or that with the giving of
notice or
passage of time or both would constitute) an Event of Default or
Termination Event with respect to such party, promptly to give
the other
party notice of such event or condition (or, in lieu of giving
notice of
such event or condition in the case of an event or condition that
with the
giving of notice or passage of time or both would constitute an
Event of
Default or Termination Event with respect to the party, to cause
such
event or condition to cease to exist before becoming an Event of
Default
or Termination Event); provided that failure to provide notice
of such
event or condition pursuant to this Part 5(m) shall not constitute
an
Event of Default or a Termination Event. Each party agrees to provide
to
the other party any other notice reasonably expected to be provided
to
facilitate compliance with the terms of this Agreement and the
Credit
Support Document.
|
(n)
|
Regarding
Party A. Party
B acknowledges and agrees that Party A has had and will have no
involvement in and, accordingly Party A 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) other than as provided in the Disclosure
Agreements, the preparation of or passing on the disclosure and
other
information contained in any offering circular or offering document
for
the Certificates, the 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 the
Disclosure Agreements; or (vii) any other aspect of Party B’s
existence.
|
(o)
|
Amendments.
This Agreement will not be amended unless the Rating Agency Condition
is
satisfied. Notwithstanding
any other provision of this Agreement, this Agreement shall not
be
amended, no Early Termination Date shall be effectively designated
by
Party B, and no transfer of any rights or obligations under this
Agreement
shall be made unless each Rating Agency has been given prior written
notice of such amendment, designation or
transfer.
|
(p)
|
Non-Petition
and Limited Recourse.
The liability of Party B under this Agreement is limited in recourse
to
the assets of the Trust Fund, and to distributions of interest
proceeds
and principal proceeds thereon applied in accordance with the terms
of the
Trust Agreement. Upon application of and exhaustion of all of the
assets
of the Trust Fund (and proceeds thereof) in accordance with the
Trust
Agreement, Party A shall not be entitled to take any further steps
against
Party B to recover any sums due but still unpaid hereunder or thereunder,
all claims in respect of which shall be extinguished. Notwithstanding
the
foregoing or anything herein to the contrary, Party A shall not
be
precluded from declaring an Event of Default or from exercising
any other
right or remedy as set forth in this Agreement or the Trust
Agreement.
|
(q)
|
Calculations.
Notwithstanding Section 6 of this Agreement, so long as Party A
is (A) the
sole Affected Party in respect of an Additional Termination Event
or a Tax
Event Upon Merger or (B) the Defaulting Party in respect of any
Event of
Default, paragraphs (i) to (vi) below shall apply:
|
(i)
|
The
definition of “Market
Quotation”
shall be deleted in its entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which is
(1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such 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 Transactions or group of Terminated Transactions that
would,
but for the occurrence of the relevant Early Termination Date, have been
required after that Date, (3) made on the basis that Unpaid Amounts in respect
of the Terminated Transaction or group of 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 and (4) made in respect of a Replacement Transaction with terms
substantially the same as those of this Agreement (save for the exclusion
of
provisions relating to Transactions that are not Terminated Transactions).
18
(ii)
|
The
definition of“Settlement
Amount” shall
be deleted in its entirety and replaced with the
following:
|
“Settlement
Amount” means,
with respect to any Early Termination Date, an amount (as determined by Party
B)
equal to the Termination Currency Equivalent of the amount (whether positive
or
negative) of any Market Quotation for the relevant Terminated Transaction
or
group of Terminated Transactions that is accepted by Party B so as to become
legally binding; provided that:
(A)
|
If,
on the day falling ten Local Business Days after the day on which
the
Early Termination Date is designated or such later day as Party
B may
specify in writing to Party A (but in either case no later than
the Early
Termination Date) (such day the “Latest Settlement Amount Determination
Day”), no Market Quotation for the relevant Terminated Transaction
or
group of Terminated Transactions has been accepted by Party B so
as to
become legally binding and one or more Market Quotations have been
made
and remain capable of becoming legally binding upon acceptance,
the
Settlement Amount shall equal the Termination Currency Equivalent
of the
amount (whether positive or negative) of the lowest of such Market
Quotations (for the avoidance of doubt, the lowest negative number
shall
equal the largest absolute value such that, for example, negative
3 shall
be lower than negative 2); or
|
(B)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotations have been made and remain capable of becoming legally
binding
upon acceptance, the Settlement Amount shall equal Party B’s Loss (whether
positive or negative and without reference to any Unpaid amounts)
for the
relevant Terminated Transaction or group of Terminated
Transactions.
|
(iii)
|
For
the purpose of clause (4) of the definition of Market Quotation,
Party B
shall determine in its sole discretion, acting in a commercially
reasonable manner, whether a Firm Offer is made in respect of a
Replacement Transaction with commercial terms substantially the
same as
those of this Agreement (save for the exclusion of provisions relating
to
Transactions that are not Terminated Transactions); provided,
however,
that notwithstanding the provisions of this Part 5(r), nothing
in this
Agreement shall preclude Party A from obtaining Market
Quotations.
|
(iv)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations remain capable of becoming
legally
binding upon acceptance, Party B shall be entitled to accept only
the
lowest of such Market Quotations.
|
(v)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
19
(vi)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
of this
Agreement shall be deleted in its entirety and replaced with the
following:
|
Second
Method and Market Quotation. If
Second
Method and Market Quotation apply, (1) Party B shall pay to Party A an amount
equal to the absolute value of the Settlement Amount in respect of the
Terminated Transactions, (2) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (3) Party
A shall
pay to Party B the Termination Currency Equivalent of the Unpaid Amounts
owing
to Party B; provided that, (i) the amounts payable under (2) and (3) shall
be
subject to netting in accordance with Section 2(c) of this Agreement and
(ii)
notwithstanding any other provision of this Agreement, any amount payable
by
Party A under (3) shall not be netted-off against any amount payable by Party
B
under (1).
(r)
|
Regulation
AB Compliance. Party
A and Party B agree that the terms of the Disclosure Agreement
dated as of
November 22, 2006 relating to the Prospectus Supplement dated as
of
November 22, 2006, each between Structured Asset Securities Corporation,
as Depositor, Xxxxxx Brothers Inc., as Underwriter, Xxxxxx Brothers
Holdings Inc., as Sponsor and IXIS Financial Products Inc., shall
be
incorporated by reference into this Agreement so that Party B shall
be an
express third party beneficiary of the Disclosure
Agreements.
|
[Signature
page follows]
20
IN
WITNESS WHEREOF,
the
parties have executed this document by their duly authorized officers with
effect from the date specified on the first page hereof.
IXIS
FINANCIAL PRODUCTS INC.
|
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES
2006-BC4
|
|
(Name
of Party)
|
(Name
of Party)
|
|
By:
Xxxxx Fargo Bank, N.A., not in its individual capacity, but solely
as
Securities Administrator
|
||
/s/ Xxxxxxx X. Xxxxxx | /s/ Xxxxxxx Xxxxxx | |
Name:
Xxxxxxx X. Xxxxxx
|
Name:
Xxxxxxx Xxxxxx
|
|
Title:
Managing Director
|
Title:
Vice President
|
|
Date:
|
Date:
11/30/06
|
|
/s/ Xxxxxxxxxxx Xxxxxx | ||
Name:
Xxxxxxxxxxx Xxxxxx
|
||
Title:
Managing Director
|
||
Date:
|
21
EXECUTION
Elections
and Variables
to
the 1994 ISDA Credit Support Annex
dated
as of
November
30, 2006
between
IXIS
FINANCIAL PRODUCTS INC.
|
and
|
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES
2006-BC4
|
_______________________________________
(“Party
A”)
|
_________________________________________
(“Party
B”)
|
Paragraph
13.
(a)
|
Security
Interest for
“Obligations”.
|
The
term “Obligations”
as used
in this Annex includes the following additional obligations: None.
(b)
|
Credit
Support Obligations.
|
(i)
|
Delivery
Amount, Return Amount and Credit Support
Amount.
|
(A)
|
“Delivery
Amount”
has the meaning specified in Paragraph 3(a), except that the
words “upon a
demand made by the Secured Party on or promptly following a Valuation
Date” shall be deleted and replaced by the words “on each Valuation Date;”
provided,
that the Delivery Amount shall be calculated, with respect to
collateral
posting required by each Rating Agency, by using (i) such Rating
Agency’s
Valuation Percentages as provided below to determine Value and
(ii) the
Credit Support Amount related to such Rating Agency. The Delivery
Amount
shall be the greatest of such calculated
amounts.
|
(B)
|
“Return
Amount”
has the meaning
specified in Paragraph 3(b); provided,
that the Return Amount shall be calculated, with respect to collateral
posting required by each Rating Agency, by using (i) such Rating
Agency’s
Valuation Percentages as provided below to determine Value and
(ii) the
Credit Support Amount related to such Rating Agency. The Return
Amount
shall be the least of such calculated
amounts.
|
(C)
|
“Credit
Support Amount”
has the meaning specified in Paragraph 13(j)(iv).
|
1
(ii)
|
Eligible
Credit Support.
The following Valuation
Percentages1
shall apply to Eligible Collateral with respect to Party A; provided,
however,
that all Eligible Collateral shall be denominated in United States
Dollars.
|
Collateral
|
S&P
Valuation
Percentage
|
Fitch
Valuation
Percentage
|
Moody’s
First
Trigger Valuation
Percentage
|
Moody’s
Second
Trigger Valuation
Percentage
|
Cash
|
100%
|
100%
|
100%
|
100%
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of not more than one
year
|
98.5%
|
97.5%
|
100%
|
100%
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than one year but not
more than
ten years
|
89.9%
|
86.3%
|
100%
|
94%
|
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than ten years
|
83.9%
|
86.7%
|
100%
|
87%
|
Fixed-rate
U.S. Agency Debentures having a remaining maturity on such date
of not
more than one year
|
98.0%
|
(2)
|
100%
|
99%
|
Fixed-rate
U.S. Agency Debentures having a remaining maturity on such date
of more
than one year but not more than ten years
|
86.9%
|
(3)
|
100%
|
93%
|
Fixed-rate
U.S. Agency Debentures having a remaining maturity on such date
of more
than ten years
|
77.9%
|
(4)
|
100%
|
86%
|
(iii)
|
Thresholds.
|
(A)
|
“Independent
Amount”
means with respect to Party A: Zero
|
1
With
respect to collateral types not listed below, such assets will be subject
to
review by each of S&P, Fitch and Moody’s.
2
Subject
to review by Fitch.
3
Subject
to review by Fitch.
4
Subject
to review by Fitch.
2
“Independent
Amount”
means
with respect to Party B: Zero
(B)
|
“Threshold”
means with respect to Party A: infinity; provided
that the Threshold with respect to Party A shall be zero for
so long as no
Relevant Entity has the First Trigger Required Ratings or a
Collateralization Event is occurring and (i) no Relevant Entity
has had
the First Trigger Required Ratings since this Annex was executed,
or (ii)
at least 30 Local Business Days have elapsed since the last time
a
Relevant Entity had the First Trigger Required Ratings, or (iii)
no
Relevant Entity has met the Hedge Counterparty Ratings Requirement
since
this Annex was executed, or (iv) at least 30 calendar days have
elapsed
since the last time a Collateralization Event occurred or (v)
a Ratings
Event is occurring.
|
“Threshold”
means
with respect to Party B: infinity.
(C)
|
“Minimum
Transfer Amount”
means
with respect to Party A: USD $100,000; provided,
however,
that if S&P is rating the Certificates and the aggregate Certificate
Principal Balances of the rated Certificates falls below $50,000,000,
then
the Minimum Transfer Amount shall mean USD $50,000.
|
(D) |
“Minimum
Transfer Amount”
means with respect to Party B: USD $100,000 (or
if the Posted Collateral is less than $100,000, the aggregate
Value of
Posted Collateral),
provided,
however,
that if S&P is rating the Certificates and the aggregate Certificate
Principal Balances of the rated Certificates falls below $50,000,000,
then
the Minimum Transfer Amount shall mean USD $50,000 (or if the
Posted
Collateral is less than $50,000, the aggregate Value of Posted
Collateral).
|
(E)
|
Rounding.
The Delivery Amount will be rounded up to the nearest integral
multiple of
USD $10,000; provided,
however,
that if S&P is rating the Certificates, the Delivery Amount will be
rounded up to the nearest integral multiple of $1,000. The Return
Amount
will be rounded down to the nearest integral multiple of USD
$10,000;
provided,
however,
that if S&P is rating the Certificates, the Return Amount will be
rounded down to the nearest integral multiple of
$1,000.
|
(iv)
|
“Exposure”
has the meaning specified in Paragraph 12, except that (1) after
the word
“Agreement” the words “(assuming, for this purpose only, that Part 5(q) of
the Schedule is deleted)” shall be inserted and (2) at the end of such
definition, the words “with terms substantially the same as those of this
Agreement.”
|
(c)
|
Valuation
and Timing.
|
(i)
|
“Valuation
Agent”
means Party A in all circumstances.
|
(ii)
|
“Valuation
Date”
means the first Local Business Day in each
week.
|
(iii)
|
“Valuation
Time”
means the close of business in the city of the Valuation Agent
on the
Local Business Day immediately preceding the Valuation Date or
date of
calculation, as applicable, provided that the calculations of
Value and
Credit Support Amount will, as far as practicable, be made as
of
approximately the same time on the same date.
|
(iv)
|
“Notification
Time”
means 11:00 a.m., New York time, on a Local Business
Day.
|
3
(d)
|
Conditions
Precedent and Secured Party’s Rights and Remedies.
None.
|
(e)
|
Substitution.
|
(i)
|
“Substitution
Date”
has the meaning specified in Paragraph
4(d)(ii).
|
(ii)
|
Consent.
If specified here as applicable, then the Pledgor must obtain
the Secured
Party’s consent for any substitution pursuant to Paragraph 4(d):
Inapplicable.
|
(f)
|
Dispute
Resolution.
|
(i)
|
“Resolution
Time”
means 1:00 p.m., New York time on the Local Business Day following
the
date on which the notice is given that gives rise to a dispute
under
Paragraph 5.
|
(ii)
|
Value.
For the purpose of Paragraphs 5(i)(C) and 5(ii), the Value of
Eligible
Credit Support or Posted Credit Support as of the relevant Valuation
Date
or date of Transfer will be calculated as follows:
|
(A)
|
with
respect to any Eligible Credit Support or Posted Credit Support
comprising
securities (“Securities”)
the sum of (a)(x) the last bid price on such date for such Securities
on
the principal national securities exchange on which such Securities
are
listed, multiplied by the applicable Valuation Percentage; or
(y) where
any Securities are not listed on a national securities exchange,
the bid
price for such Securities quoted as at the close of business
on such date
by any principal market maker (which shall not be and shall be
independent
from the Valuation Agent) for such Securities chosen by the Valuation
Agent, multiplied by the applicable Valuation Percentage; or
(z) if no
such bid price is listed or quoted for such date, the last bid
price
listed or quoted (as the case may be), as of the day next preceding
such
date on which such prices were available, multiplied by the applicable
Valuation Percentage; plus (b) the accrued interest where applicable
on
such Securities (except to the extent that such interest shall
have been
paid to the Pledgor pursuant to Paragraph 5(c)(ii) or included
in the
applicable price) as of such date;
and
|
(B)
|
with
respect to any Cash, the face amount
thereof.
|
(iii)
|
Alternative.
The provisions of Paragraph 5 will
apply.
|
(g)
|
Holding
and Using Posted
Collateral.
|
(i)
|
Eligibility
to Hold Posted Collateral; Custodians:
|
A
Custodian will be entitled to hold Posted Collateral on behalf of Party
B
pursuant to Paragraph 6(b); provided
that:
(1) Posted
Collateral may be held only in the following jurisdiction: United
States.
(2) The
Custodian for Party B (A) is a commercial bank or trust company which is
unaffiliated with Party B and organized under the laws of the United States
or
state thereof, having assets of at least $500 million and a long term debt
or a
deposit rating of at least (i) Baa2 from Moody’s and (ii) A-1 from S&P, or
is the Trustee, and a short term rating from Fitch of at least “F1” and (B)
shall hold all Eligible Credit Support in an Eligible Account segregated
from
the Swap Account and the Interest Rate Cap Account, as defined in the related
Trust Agreement.
4
Initially,
the Custodian for Cash and Securities for Party B is: The Securities
Administrator under the Trust Agreement, or any successor securities
administrator thereto.
(ii)
|
Use
of Posted Collateral.
The provisions of Paragraph 6(c)(i) will not apply to Party B,
but the
provisions of Paragraph 6(c)(ii) will apply to Party B.
|
(iii)
|
Notice.
If a party or its Custodian fails to meet the criteria for eligibility
to
hold (or, in the case of a party, to use) Posted Collateral set
forth in
this Paragraph 13(g), such party shall promptly notify the other
party of
such ineligibility.
|
(h)
|
Distributions
and Interest Amount.
|
(i)
|
Interest
Rate.
The “Interest
Rate”
will be the federal funds overnight rate as published by the
Board of
Governors of the Federal Reserve System in H.15 (519) or its
successor
publication, or such other rate as the parties may agree from
time to
time.
|
(ii)
|
Transfer
of Interest Amount.
The transfer of the Interest Amount will be made on the second
Local
Business Day following the end of each calendar month and on
any other
Local Business Day on which Posted Collateral in the form of
Cash is
transferred to the Pledgor pursuant to Paragraph 3(b), in each
case to the
extent that a Delivery Amount would not be created or increased
by that
transfer, provided
that Party B shall not be obliged to so transfer any Interest
Amount
unless and until it has earned and received such
interest.
|
(iii)
|
Alternative
to Interest Amount.
The provisions of Paragraph 6(d)(ii) will apply.
|
(i)
|
Address
for Transfers.
|
Party
A:
To be notified to Party B by Party A at the time of the request for the
transfer.
Party
B:
To be notified to Party A by Party B upon request by Party A.
(j)
|
Other
Provisions.
|
(i)
|
Events
of Default.
|
Subclause
(iii) shall be deleted from Paragraph
7.
(ii)
|
Costs
of Transfer on
Exchange.
|
Notwithstanding
Paragraph 10, the Pledgor
will be responsible for, and will reimburse the Secured Party
for, all
transfer and other taxes and other costs involved in the transfer
of
Eligible Credit Support either from the Pledgor to the Secured
Party or
from the Secured Party to the
Pledgor.
|
(iii)
|
Cumulative
Rights.
|
5
The
rights, powers and remedies of the Secured Party under this Annex
shall be
in addition to all rights, powers and remedies given to the Secured
Party
by the Agreement or by virtue of any statute or rule of law,
all of which
rights, powers and remedies shall be cumulative and may be exercised
successively or concurrently without impairing the rights of
the Secured
Party in the Posted
Credit Support created pursuant to this
Annex.
|
(iv)
|
Ratings
Criteria.
|
“Credit
Support Amount”
shall be
the greater of (a) the S&P Credit Support Amount, (b) the Fitch Credit
Support Amount, and (c) the Moody’s First Trigger Credit Support Amount, or the
Moody’s Second Trigger Credit Support Amount, as applicable.
With
respect to Fitch:
“Fitch
Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of:
(I)
|
(A)
|
for
any Valuation Date (x) on which a Collateralization Event with
respect to
Fitch has occurred and been continuing for at least 30 calendar
days or
(y) on which a Ratings Event with respect to Fitch has occurred
and is
continuing, an amount equal to the sum of (1) the aggregate Secured
Party’s Exposure for such Valuation Date with respect to all Transactions
and (2) the aggregate of the products of the Volatility Buffer
for each
Transaction and the Notional Amount of each Transaction for the
Calculation Period of each such Transaction which includes such
Valuation
Date, or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II)
|
the
Threshold for Party A for such Valuation
Date.
|
“Volatility
Buffer”
shall
mean the percentage set forth in the following table with respect to any
Transaction (other than a Transaction identified in the related Confirmation
as
a Timing Hedge):
Weighted
Average Life (Years)
|
|||||||||||||||
Notes’
Rating
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
13
|
14
|
>=15
|
USD
Interest Rate Swaps
|
|||||||||||||||
AA-
or Better
|
0.8
|
1.7
|
2.5
|
3.3
|
4.0
|
4.7
|
5.3
|
5.9
|
6.5
|
7.0
|
7.5
|
8.0
|
8.5
|
9.0
|
9.5
|
A+/A
|
0.6
|
1.2
|
1.8
|
2.3
|
2.8
|
3.3
|
3.8
|
4.2
|
4.6
|
5.0
|
5.3
|
5.7
|
6.0
|
6.4
|
6.7
|
A-/BBB+
|
0.5
|
1.0
|
1.6
|
2.0
|
2.5
|
2.9
|
3.3
|
3.6
|
4.0
|
4.3
|
4.7
|
5.0
|
5.3
|
5.6
|
5.9
|
With
respect to Moody’s:
“Xxxxx’x
First Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
(I) |
(A) for
any Valuation Date on which (I) a First Trigger Failure Condition
has
occurred and has been continuing (x) for at least 30 Local Business
Days
or (y) since this Annex was executed and (II) it is not the case
that a
Moody’s Second Trigger Event has occurred and been continuing for at
least
30 Local Business Days, an amount equal to the greater of (a)
zero and (b)
the sum of the Secured Party’s aggregate Exposure for all Transactions and
the aggregate of Moody’s Additional Collateralized Amounts for each
Transaction.
|
6
For
the purposes of this definition, the “Moody’s
Additional Collateralized Amount”
with respect to any Transaction shall mean:
|
[the
lesser of (x) the product of the Moody’s First Trigger DV01 Multiplier and
DV01 for such Transaction and such Valuation Date and (y) the
product of
Xxxxx’x First Trigger Notional Amount Multiplier and the Notional Amount
for such Transaction for the Calculation Period which includes
such
Valuation Date;]5
|
[the
product of the applicable Moody’s First Trigger Factor set forth in Table
1 and the Notional Amount for such Transaction for the Calculation
Period
which includes such Valuation Date;]6
or
|
(B) for
any
other Valuation Date, zero, over
(II)
|
the
Threshold for Party A such Valuation
Date.
|
“First
Trigger Failure Condition”
means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s First Trigger Required Ratings.
“DV01”
means,
with respect to a Transaction and any date of determination, the sum of
the
estimated change in the Secured Party’s Exposure with respect to such
Transaction that would result from a one basis point change in the relevant
swap
curve on such date, as determined by the Valuation Agent in good faith
and in a
commercially reasonable manner. The Valuation Agent shall, upon request
of Party
B, provide to Party B a statement showing in reasonable detail such
calculation.
“Moody’s
First Trigger DV01 Multiplier”
means
25.
“Moody’s
First Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x First Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Xxxxx’x
First Trigger Notional Amount Multiplier”
means
4%.
“Xxxxx’x
Second Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
(III) |
(A) for
any Valuation Date on which it is the case that a Second Trigger
Failure
Condition has occurred and been continuing for at least 30 Local
Business
Days, an amount equal to the greatest of (a) zero, (b) the aggregate
amount of the next payments due to be paid by Party A under each
Transaction and (c) the sum of the Secured Party’s aggregate Exposure and
the aggregate of Moody’s Additional Collateralized Amounts for each
Transaction.
|
For
the purposes of this definition, the “Moody’s
Additional Collateralized Amount”with
respect to any Transaction shall mean:
|
5
If
Moody’s First Trigger Credit Support Amount is calculated using
DV01.
6
If
Moody’s First Trigger Credit Support Amount is calculated without using
DV01.
7
[the
lesser of (i) the product of the Xxxxx’x Second Trigger DV01 Multiplier
and DV01 for such Transaction and such Valuation Date and (ii)
the product
of the Xxxxx’x Second Trigger Notional Amount Multiplier and the Notional
Amount for such Transaction for the Calculation Period which
includes such
Valuation Date;]7
|
[the
product of the applicable Moody’s Second Trigger Factor set forth in Table
2 and the Notional Amount for such Transaction for the Calculation
Period
which includes such Valuation Date;]8
or
|
(B) for
any
other Valuation Date, zero, over
(IV)
|
the
Threshold for Party A for such Valuation
Date.
|
“Second
Trigger Failure Condition”
means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s Second Trigger Ratings Threshold.
“Moody’s
Second Trigger DV01 Multiplier”
means
60.
“Moody’s
Second Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x Second Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Moody’s
Second Trigger Notional Amount Multiplier”
means
9%.
With
respect to S&P:
“S&P
Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of:
(I)
|
(A)
|
for
any Valuation Date (x) on which a Collateralization Event with
respect to
S&P has occurred and been continuing for at least 30 calendar days
or
(y) on which a Ratings Event with respect to S&P has occurred and is
continuing, an amount equal to the sum of (1) the aggregate Secured
Party’s Exposure for such Valuation Date with respect to all Transactions
and (2) the aggregate of the products of the Volatility Buffer
for each
Transaction and the Notional Amount of each Transaction for the
Calculation Period of each such Transaction which includes such
Valuation
Date, or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) |
the
Threshold for Party A for such Valuation
Date.
|
“Volatility
Buffer”
shall
mean the percentage set forth in the following table with respect to any
Transaction (other than a Transaction identified in the related Confirmation
as
a Timing Hedge):
7
If
Moody’s Second Trigger Credit Support Amount for a fixed schedule swap is
calculated using DV01.
8
If
Moody’s Second Trigger Credit Support Amount for a fixed schedule swap is
calculated without using DV01.
8
Short-term
credit rating of Party A’s Credit Support Provider
|
Remaining
Weighted Average Life Maturity up to 3 years
|
Remaining
Weighted Average Life Maturity up to 5 years
|
Remaining
Weighted Average Life Maturity up to 10 years
|
Remaining
Weighted Average Life Maturity up to 30 years
|
At
least “A-2”
|
2.75
|
3.25
|
4.00
|
4.75
|
“A-3”
|
3.25
|
4.00
|
5.00
|
6.25
|
“BB+”
or lower
|
3.50
|
4.50
|
6.75
|
7.50
|
(v)
|
Demands
and Notices.
|
All
demands, specifications and notices under this Annex will be made pursuant
to
the Notices Section of this Agreement, save that any demand, specification
or
notice:
(A)
|
shall
be given to or made at the following
addresses:
|
If
to
Party A:
As
set
forth in Part 4(a) of the Schedule.
If
to
Party B:
As
set
forth in Part 4(a) of the Schedule.
or
at
such other address as the relevant party may from time to time designate
by
giving notice (in accordance with the terms of this subparagraph) to the
other
party;
(B)
|
shall
be deemed to be effective at the time such notice is actually
received
unless such notice is received on a day which is not a Local
Business Day
or after the Notification Time on any Local Business Day in which
event
such notice shall be deemed to be effective on the next succeeding
Local
Business Day.
|
Pursuant
to the Section 4.03 of the Trust Agreement, the monthly report to
Certificateholders shall be made available to Party A in the manner and
form
specified therein.
(vi)
|
Agreement
as to Single Secured Party and
Pledgor
|
Party
A and Party B agree that, notwithstanding anything to the contrary
in the
first
sentence of this Annex, Paragraph 1(b) or Paragraph 2 or the
definitions
in Paragraph 12, except with respect to Party B’s obligations under
Paragraph 3(b), (a) the term “Secured Party” as used in this Annex means
only Party B, (b) the term “Pledgor” as used in this Annex means only
Party A, (c) only Party A makes the pledge and grant in Paragraph
2, the
acknowledgement in the final sentence of Paragraph 8(a) and the
representations in Paragraph 9 and (d) only Party A will be required
to
make Transfers of Eligible Credit Support hereunder. Party A
and Party B
further agree that, notwithstanding anything to the contrary
in the
recital to this Annex or Paragraph 7, this Annex will constitute
a Credit
Support Document only with respect to Party
A.
|
(vii)
|
Securities
Administrator Capacity.
|
9
It
is expressly understood and agreed by the parties hereto that
(i) this
Annex is executed and delivered by the Securities Administrator
not
individually or personally but solely as securities administrator
of the
Trust, (ii) each of the representations, undertakings and agreements
herein made on the part of the Trust is made and intended not
as personal
representations, undertakings and agreements by the Securities
Administrator but is made and intended for the purpose of binding
only the
Trust, (iii) nothing herein contained shall be construed as creating
any
liability on the part of the Securities Administrator, individually
or
personally, to perform any covenant either expressed or implied
contained
herein, all such liability, if any, being expressly waived by
the parties
hereto and by any Person claiming by, through or under the parties
hereto
and (iv) under no circumstances shall the Securities Administrator
be
personally liable for the payment of any indebtedness or expenses
of the
Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the
Trust under
this Annex or any other related documents as to all of which
recourse
shall be had solely to the assets of the Trust in accordance
with the
terms of the Trust Agreement; unless the Securities Administrator
was
grossly negligent or acted with wilful
misconduct.
|
(viii)
|
External
Marks.
|
At
such time as the long-term senior debt rating of Party A’s
Credit
Support Provider is BBB or lower from S&P, Party A in its capacity as
Valuation Agent shall get external verification of its calculation of Exposure
on a monthly basis. This verification shall be at Party A’s expense and may not
be verified by the same entity more than four (4) times in any twelve (12)-month
period. The external xxxx should reflect the higher of two (2) bids from
counterparties that would be willing and eligible to provide the swap in
the
absence of the current provider. Such bids and any external marks received
by
the Valuation Agent shall be provided to S&P. The calculation of Exposure
should be based on the greater of the internal and external marks.
[Signature
page follows]
10
IN
WITNESS WHEREOF,
the
parties have executed this document by their duly authorized officers
with
effect from the date specified on the first page hereof.
IXIS
FINANCIAL PRODUCTS INC.
|
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES
2006-BC4
|
|
(Name
of Party)
|
(Name
of Party)
|
|
By:
Xxxxx Fargo Bank, N.A., not in its individual capacity, but
solely as
Securities Administrator
|
||
/s/ Xxxxxxx X. Xxxxxx | /s/ Xxxxxxx Xxxxxx | |
Name:
Xxxxxxx X. Xxxxxx
|
Name:
Xxxxxxx Xxxxxx
|
|
Title:
Managing Director
|
Title:
Vice President
|
|
Date:
|
Date:
|
|
/s/ Xxxxxxxxxxx Xxxxxx | ||
Name:
Xxxxxxxxxxx Xxxxxx
|
||
Title:
Managing Director
|
||
Date:
|
11
Table
1
Moody’s
First Trigger Factor
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
1
or less
|
0.25%
|
More
than 1 but not more than 2
|
0.50%
|
More
than 2 but not more than 3
|
0.70%
|
More
than 3 but not more than 4
|
1.00%
|
More
than 4 but not more than 5
|
1.20%
|
More
than 5 but not more than 6
|
1.40%
|
More
than 6 but not more than 7
|
1.60%
|
More
than 7 but not more than 8
|
1.80%
|
More
than 8 but not more than 9
|
2.00%
|
More
than 9 but not more than 10
|
2.20%
|
More
than 10 but not more than 11
|
2.30%
|
More
than 11 but not more than 12
|
2.50%
|
More
than 12 but not more than 13
|
2.70%
|
More
than 13 but not more than 14
|
2.80%
|
More
than 14 but not more than 15
|
3.00%
|
More
than 15 but not more than 16
|
3.20%
|
More
than 16 but not more than 17
|
3.30%
|
More
than 17 but not more than 18
|
3.50%
|
More
than 18 but not more than 19
|
3.60%
|
More
than 19 but not more than 20
|
3.70%
|
More
than 20 but not more than 21
|
3.90%
|
More
than 21 but not more than 22
|
4.00%
|
More
than 22 but not more than 23
|
4.00%
|
More
than 23 but not more than 24
|
4.00%
|
More
than 24 but not more than 25
|
4.00%
|
More
than 25 but not more than 26
|
4.00%
|
More
than 26 but not more than 27
|
4.00%
|
More
than 27 but not more than 28
|
4.00%
|
More
than 28 but not more than 29
|
4.00%
|
More
than 29
|
4.00%
|
12
Table
2
Moody’s
Second Trigger Factor for Interest Rate Swaps with Fixed Notional
Amounts
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
1
or less
|
0.60%
|
More
than 1 but not more than 2
|
1.20%
|
More
than 2 but not more than 3
|
1.70%
|
More
than 3 but not more than 4
|
2.30%
|
More
than 4 but not more than 5
|
2.80%
|
More
than 5 but not more than 6
|
3.30%
|
More
than 6 but not more than 7
|
3.80%
|
More
than 7 but not more than 8
|
4.30%
|
More
than 8 but not more than 9
|
4.80%
|
More
than 9 but not more than 10
|
5.30%
|
More
than 10 but not more than 11
|
5.60%
|
More
than 11 but not more than 12
|
6.00%
|
More
than 12 but not more than 13
|
6.40%
|
More
than 13 but not more than 14
|
6.80%
|
More
than 14 but not more than 15
|
7.20%
|
More
than 15 but not more than 16
|
7.60%
|
More
than 16 but not more than 17
|
7.90%
|
More
than 17 but not more than 18
|
8.30%
|
More
than 18 but not more than 19
|
8.60%
|
More
than 19 but not more than 20
|
9.00%
|
More
than 20 but not more than 21
|
9.00%
|
More
than 21 but not more than 22
|
9.00%
|
More
than 22 but not more than 23
|
9.00%
|
More
than 23 but not more than 24
|
9.00%
|
More
than 24 but not more than 25
|
9.00%
|
More
than 25 but not more than 26
|
9.00%
|
More
than 26 but not more than 27
|
9.00%
|
More
than 27 but not more than 28
|
9.00%
|
More
than 28 but not more than 29
|
9.00%
|
More
than 29
|
9.00%
|
13
IXIS
FINANCIAL PRODUCTS INC.
0
Xxxx
00xx Xxxxxx, 00xx Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Fax:
(000) 000-0000 / Phone: (000) 000-0000 / 6194
DATE:
|
November
30, 2006
|
TO:
|
Supplemental
Interest Trust,
|
Structured
Asset Securities Corporation 2006-BC4
|
|
c/o
Wells Fargo Bank, N.A.
|
|
0000
Xxx Xxxxxxxxx Xxxx
|
|
Xxxxxxxx,
Xxxxxxxx 00000
|
|
Telephone:
000-000-0000
|
|
Fax:
000-000-0000
|
|
Attention:
Client Service Manager - SASCO 2006-BC4
|
|
("Party B")
|
|
FROM:
|
IXIS
Financial Products Inc. (“Party A”)
|
RE:
|
Interest
Rate Cap Transaction
|
Dear
Sir
or Madam:
The
purpose of this letter agreement (this “Confirmation”) is to confirm the terms
and conditions of the Transaction entered into between us on the Trade
Date
specified below (the “Transaction”).
The
definitions and provisions contained in the 2000 ISDA Definitions as
published
by the International Swaps and Derivatives Association, Inc. are incorporated
into this Confirmation. In the event of any inconsistency between those
definitions and provisions and this Confirmation, this Confirmation
will
govern.
This
Confirmation constitutes a “Confirmation” as referred to in, and supplements,
forms part of and is subject to, the ISDA Master Agreement dated as
of November
30, 2006, as amended and supplemented from time to time (the “Agreement”)
between Party A and Party B. All provisions contained in the Agreement
govern
this Confirmation except as expressly modified below.
1
1. |
The
Cap Transaction to which this Confirmation relates is a Rate
Cap
Transaction, the terms of which are as
follow:
|
General
Terms
|
||
Trade
Date:
|
November
27, 2006
|
|
Effective
Date:
|
October
25, 2007, subject to adjustment in accordance with the Following
Business
Day Convention
|
|
Termination
Date:
|
November
25, 2011, subject to adjustment in accordance with the Following
Business
Day Convention
|
|
Notional
Amount:
|
See
Amortization Schedule, Schedule A
|
|
Fixed
Amounts:
|
||
Fixed
Amount Payer:
|
Xxxxxx
Brothers Holdings Inc. on behalf of Party B.
|
|
Fixed
Amount:
|
$900,000.
|
|
Fixed
Amount Payment Date:
|
On
or prior to November 30, 2006, subject to adjustment in accordance
with
the Following Business Day Convention.
|
|
Floating
Amounts:
|
||
Floating
Rate Payer:
|
Party
A
|
|
Floating
Rate:
|
The
greater of (a) 0% and (b) USD-LIBOR-BBA with a Designated
Maturity of one
month minus
the Strike Rate (as set forth in Schedule A).
|
|
Floating
Rate Payer Period End Dates:
|
The
25th
day of each month of each year, commencing on November 25,
2007 to and
including the Termination Date, subject to adjustment in
accordance with
the Following Business Day Convention.
|
|
Floating
Rate Payer Payment Dates:
|
Early
Payment, one (1) Business Day preceding each Floating Rate
Payer Period
End Date.
|
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
|
Designated
Maturity:
|
One
(1) month
|
|
Spread:
|
None
|
|
Floating
Rate Day Count Fraction:
|
Actual/360
|
2
Reset
Dates:
|
The
first day of each Calculation Period.
|
|
Compounding:
|
Inapplicable
|
|
Business
Days:
|
Any
day other than (i) a Saturday or a Sunday, or (ii) a day
on which banking
institutions in (1) the city in which the Corporate Trust
Office of Party
B is located or (2) the States of New York, Maryland, Massachusetts
or
Minnesota are closed.
|
|
Procedural
Terms:
|
||
Calculation
Agent:
|
Party
A
|
|
Offices:
|
The
Office of Party A for this Cap Transaction is New York.
|
|
Account
Details:
|
||
2.
|
Payments
to Party A:
|
CITIBANK
N.A.
ABA#
000-000-000
Account
No.: 00000000
A/C
IXISFP
|
Payments
to Party B:
|
Xxxxx
Fargo Bank, N.A.
ABA#
000000000
For
Credit to: Corporate Trust Clearing
Acct:
0000000000
FFC:
50968003
Attn:
SASCO 2006-BC4 // Interest Rate Cap
Account
|
3
Please
confirm that the foregoing correctly sets forth the terms and conditions
of our
agreement by executing this Confirmation and returning it to us by
facsimile
to:
IXIS
Financial Products Inc.
(000)
000-0000 (fax)
Attn:
Swap Operations
IXIS
FINANCIAL PRODUCTS INC.
By:
/s/ Xxxxxxx X. Xxxxxx
Authorized
Signatory
By:
/s/ Xxxxxxxxxxx Xxxxxx
Authorized
Signatory
Accepted
and confirmed as of the Trade Date written above:
SUPPLEMENTAL
INTEREST TRUST,
STRUCTURED
ASSET SECURITIES CORPORATION 2006-BC4
By:
Xxxxx Fargo Bank, N. A., not in its individual capacity, but solely
as
Securities Administrator
By:
/s/ Xxxxxxx Xxxxxx
Name:
Xxxxxxx Xxxxxx
Title:
Vice President
4
SCHEDULE
A to
the
Confirmation dated as of November 30, 2006,
Re:
Reference Number 368707C
Amortization
Schedule, subject
to adjustment in accordance with the Following Business Day
Convention
From
and including
|
To
but excluding
|
Notional
Amount (USD)
|
Strike
Rate (%)
|
November
25, 2006
|
December
25, 2006
|
0.00
|
0.00
|
December
25, 2006
|
January
25, 2007
|
0.00
|
0.00
|
January
25, 2007
|
February
25, 2007
|
0.00
|
0.00
|
February
25, 2007
|
March
25, 2007
|
0.00
|
0.00
|
March
25, 2007
|
April
25, 2007
|
0.00
|
0.00
|
April
25, 2007
|
May
25, 2007
|
0.00
|
0.00
|
May
25, 2007
|
June
25, 2007
|
0.00
|
0.00
|
June
25, 2007
|
July
25, 2007
|
0.00
|
0.00
|
July
25, 2007
|
August
25, 2007
|
0.00
|
0.00
|
August
25, 2007
|
September
25, 2007
|
0.00
|
0.00
|
September
25, 2007
|
October
25, 2007
|
0.00
|
0.00
|
October
25, 2007
|
November
25, 2007
|
3,665,000.00
|
6.50
|
November
25, 2007
|
December
25, 2007
|
7,330,000.00
|
6.50
|
December
25, 2007
|
January
25, 2008
|
10,996,000.00
|
6.50
|
January
25, 2008
|
February
25, 2008
|
14,661,000.00
|
6.50
|
February
25, 2008
|
March
25, 2008
|
18,326,000.00
|
6.50
|
March
25, 2008
|
April
25, 2008
|
28,477,000.00
|
6.50
|
April
25, 2008
|
May
25, 2008
|
39,007,000.00
|
6.50
|
May
25, 2008
|
June
25, 2008
|
49,818,000.00
|
6.50
|
June
25, 2008
|
July
25, 2008
|
60,819,000.00
|
6.50
|
July
25, 2008
|
August
25, 2008
|
71,927,000.00
|
6.50
|
August
25, 2008
|
September
25, 2008
|
83,062,000.00
|
6.50
|
September
25, 2008
|
October
25, 2008
|
94,144,000.00
|
6.50
|
October
25, 2008
|
November
25, 2008
|
105,109,000.00
|
6.50
|
November
25, 2008
|
December
25, 2008
|
203,449,000.00
|
6.50
|
December
25, 2008
|
January
25, 2009
|
246,097,000.00
|
6.50
|
January
25, 2009
|
February
25, 2009
|
281,195,000.00
|
6.50
|
February
25, 2009
|
March
25, 2009
|
303,237,000.00
|
6.50
|
March
25, 2009
|
April
25, 2009
|
316,342,000.00
|
6.50
|
April
25, 2009
|
May
25, 2009
|
323,091,000.00
|
6.50
|
May
25, 2009
|
June
25, 2009
|
325,188,000.00
|
6.50
|
June
25, 2009
|
July
25, 2009
|
323,803,000.00
|
6.50
|
July
25, 2009
|
August
25, 2009
|
319,768,000.00
|
6.50
|
August
25, 2009
|
September
25, 2009
|
313,682,000.00
|
6.50
|
September
25, 2009
|
October
25, 2009
|
307,567,000.00
|
6.50
|
October
25, 2009
|
November
25, 2009
|
301,434,000.00
|
6.50
|
November
25, 2009
|
December
25, 2009
|
295,307,000.00
|
6.50
|
December
25, 2009
|
January
25, 2010
|
289,184,000.00
|
6.50
|
January
25, 2010
|
February
25, 2010
|
283,073,000.00
|
6.50
|
February
25, 2010
|
March
25, 2010
|
276,983,000.00
|
6.50
|
March
25, 2010
|
April
25, 2010
|
270,920,000.00
|
6.50
|
5
From
and including
|
To
but excluding
|
Notional
Amount (USD)
|
Strike
Rate (%)
|
April
25, 2010
|
May
25, 2010
|
264,894,000.00
|
6.50
|
May
25, 2010
|
June
25, 2010
|
258,907,000.00
|
6.50
|
June
25, 2010
|
July
25, 2010
|
252,969,000.00
|
6.50
|
July
25, 2010
|
August
25, 2010
|
247,081,000.00
|
6.50
|
August
25, 2010
|
September
25, 2010
|
241,252,000.00
|
6.50
|
September
25, 2010
|
October
25, 2010
|
235,483,000.00
|
6.50
|
October
25, 2010
|
November
25, 2010
|
229,781,000.00
|
6.50
|
November
25, 2010
|
December
25, 2010
|
224,146,000.00
|
6.50
|
December
25, 2010
|
January
25, 2011
|
218,587,000.00
|
6.50
|
January
25, 2011
|
February
25, 2011
|
213,098,000.00
|
6.50
|
February
25, 2011
|
March
25, 2011
|
207,688,000.00
|
6.50
|
March
25, 2011
|
April
25, 2011
|
202,358,000.00
|
6.50
|
April
25, 2011
|
May
25, 2011
|
197,108,000.00
|
6.50
|
May
25, 2011
|
June
25, 2011
|
191,939,000.00
|
6.50
|
June
25, 2011
|
July
25, 2011
|
186,857,000.00
|
6.50
|
July
25, 2011
|
August
25, 2011
|
181,859,000.00
|
6.50
|
August
25, 2011
|
September
25, 2011
|
176,949,000.00
|
6.50
|
September
25, 2011
|
October
25, 2011
|
172,125,000.00
|
6.50
|
October
25, 2011
|
November
25, 2011
|
167,398,000.00
|
6.50
|
6