Exhibit 99.6
GUARANTEE OF XXXXXX BROTHERS HOLDINGS INC.
XXXXXX BROTHERS SPECIAL FINANCING INC. ("Party A") and THE BANK OF NEW
YORK, not in its individual capacity but solely as Swap Contract Administrator
for CWABS Asset-Backed Certificates Trust 2006-16, Asset-Backed Certificates,
Series 2006-16 ("Party B") have entered into a Master Agreement dated as of
September 28, 2006, as amended from time to time (the "Master Agreement"),
pursuant to which Party A and Party B have entered and/or anticipate entering
into one or more transactions (each a "Transaction"), the Confirmation of each
of which supplements, forms part of, and will be read and construed as one with,
the Master Agreement (collectively referred to as the "Agreement"). This
Guarantee is a Credit Support Document as contemplated in the Agreement. For
value received, and in consideration of the financial accommodation accorded to
Party A by Party B under the Agreement, XXXXXX BROTHERS HOLDINGS INC., a
corporation organized and existing under the laws of the State of Delaware
("Guarantor"), hereby agrees to the following:
(a) Guarantor hereby unconditionally guarantees to Party B the due and
punctual payment of all amounts payable by Party A in connection with each
Transaction when and as Party A's obligations thereunder shall become due and
payable in accordance with the terms of the Agreement (whether at maturity, by
acceleration or otherwise). Guarantor hereby agrees, upon written demand by
Party B, to pay or cause to be paid any such amounts punctually when and as the
same shall become due and payable.
(b) Guarantor hereby agrees that its obligations under this Guarantee
constitute a guarantee of payment when due and not of collection.
(c) Guarantor hereby agrees that its obligations under this Guarantee
shall be unconditional, irrespective of the validity, regularity or
enforceability of the Agreement against Party A (other than as a result of the
unenforceability thereof against Party B), the absence of any action to enforce
Party A's obligations under the Agreement, any waiver or consent by Party B with
respect to any provisions thereof, the entry by Party A and Party B into any
amendments to the Agreement, additional Transactions under the Agreement or any
other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a guarantor (excluding the defense of payment or statute
of limitations, neither of which is waived) provided, however, that Guarantor
shall be entitled to exercise any right that Party A could have exercised under
the Agreement to cure any default in respect of its obligations under the
Agreement or to setoff, counterclaim or withhold payment in respect of any Event
of Default or Potential Event of Default in respect of Party B or any Affiliate,
but only to the extent such right is provided to Party A under the Agreement.
The Guarantor acknowledges that Party A and Party B may from time to time enter
into one or more Transactions pursuant to the Agreement and agrees that the
obligations of the Guarantor under this Guarantee will upon the execution of any
such Transaction by Party A and Party B extend to all such Transactions without
the taking of further action by the Guarantor.
(d) This Guarantee shall remain in full force and effect until the first
to occur of (i) receipt by Party B of a written notice of termination from
Guarantor or (ii) none of the obligations of Party A remain outstanding.
Termination of this Guarantee shall not affect Guarantor's liability hereunder
as to obligations incurred or arising out of Transactions entered into prior to
the termination hereof.
(e) Guarantor further agrees that this Guarantee shall continue to be
effective or be reinstated, as the case may be, if at any time, payment, or any
part thereof, of any obligation or interest thereon is rescinded or must
otherwise be restored by Party B upon an Event of Default as set forth in
Section 5(a)(vii) of the Master Agreement affecting Party A or Guarantor.
(f) Guarantor hereby waives (i) promptness, diligence, presentment, demand
of payment, protest, order and, except as set forth in paragraph (a) hereof,
notice of any kind in connection with the Agreement and this Guarantee, or (ii)
any requirement that Party B exhaust any right to take any action against Party
A or any other person prior to or contemporaneously with proceeding to exercise
any right against Guarantor under this Guarantee.
XXXXXX BROTHERS HOLDINGS INC.
000 XXXXXXX XXXXXX, XXX XXXX, XXX XXXX 00000
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XXXXXX BROTHERS
This Guarantee shall be governed by and construed in accordance with the
laws of the State of New York without regard to conflicts of laws principles.
All capitalized terms not defined in this Guarantee, but defined in the
Agreement, shall have the meanings assigned thereto in the Agreement.
IN WITNESS WHEREOF, Xxxxxxxxx has caused this Guarantee to be executed by
its duly authorized officer as of the date of the Agreement.
XXXXXX BROTHERS HOLDINGS INC.
By: /s/ Xxxxx X. Xxxxxxxxxx III
Name: Xxxxx X. Xxxxxxxxxx III
Title: Vice President
Date: September 28, 2006
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XXXXXX BROTHERS HOLDINGS INC.
000 XXXXXXX XXXXXX, XXX XXXX, XXX XXXX 00000
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