ISDAÒ International Swap Dealers Association, Inc. MASTER AGREEMENT dated as of May 9, 2006
EXHIBIT
4.3
(Multicurrency—Cross
Border)
ISDAÒ
International
Swap Dealers Association, Inc.
MASTER
AGREEMENT
dated
as
of May 9, 2006
|
ABN
AMRO BANK, N.V.
(“Party
A”)
|
and
|
LONG
BEACH MORTGAGE LOAN
SUPPLEMENTAL
INTEREST
TRUST
2006-4
(“Party
B”)
|
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:—
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1.
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Interpretation
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(a) Definitions.
The
terms defined in Section 14 and in the Schedule will have the meanings therein
specified for the purpose of this Master Agreement.
(b) Inconsistency.
In the
event of any inconsistency between the provisions of the Schedule and the other
provisions of this Master Agreement, the Schedule will prevail. In the event
of
any inconsistency between the provisions of any Confirmation and this Master
Agreement (including the Schedule), such Confirmation will prevail for the
purpose of the relevant Transaction.
(c) Single
Agreement.
All
Transactions are entered into in reliance on the fact that this Master Agreement
and all Confirmations form a single agreement between the parties (collectively
referred to as this
“Agreement”), and the parties would not otherwise enter into any
Transactions.
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2.
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Obligations
|
|
(a)
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General
Conditions.
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(i) Each
party will make each payment or delivery specified in each Confirmation to
be
made by it, subject to the other provisions
of this
Agreement.
(ii) Payments
under this Agreement will be made on the due date for value on that date in
the
place of
the
account specified in the relevant Confirmation or otherwise pursuant to this
Agreement, in freely transferable funds and in the manner customary for payments
in the required currency. Where
settlement is by delivery (that is, other than by payment), such delivery will
be made for
receipt
on the due date in the manner customary for the relevant obligation unless
otherwise specified in the relevant Confirmation or elsewhere in this
Agreement.
(iii) Each
obligation of each party under Section 2(a)(i) is subject to (1) the condition
precedent that
no
Event of Default or Potential Event of Default with respect to the other party
has occurred and
is
continuing, (2) the condition precedent that no Early Termination Date in
respect of the relevant Transaction has occurred or been effectively designated
and (3) each other applicable condition precedent specified in this
Agreement.
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.
|
ABN
AMRO BANK, N.V.
|
LONG
BEACH MORTGAGE LOAN
SUPPLEMENTAL
INTEREST TRUST
2006-4
|
|
|
By:____________________________
Name:
Title:
Date:
|
By
Deutsche Bank National Trust Company,
not
in its individual capacity but solely
as
Trustee on behalf of the Trust
By:_______________________________
Name:
Title:
Date:
|
|
|
By:____________________________
Name:
Title:
Date:
|
By:____________________________
Name:
Title:
Date:
|
Rate
Swap Schedule
SCHEDULE
to
the
Master
Agreement
dated
as
of May 9,
2006
between
|
ABN
AMRO BANK, N.V.
|
and
|
LONG
BEACH MORTGAGE LOAN SUPPLEMENTAL
INTEREST TRUST
2006-4
|
|
_______________________________________
(“Party
A”)
|
_________________________________________
(“Party
B”)
|
Part
1.
Termination
Provisions.
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(a)
|
“Specified
Entity”
means in relation to Party A for the purpose
of:
|
|
Section
5(a)(v),
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Not
applicable
|
|
Section
5(a)(vi),
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Not
applicable
|
|
Section
5(a)(vii),
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Not
applicable
|
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Section
5(b)(iv),
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Not
applicable
|
and
in
relation to Party B for the purpose of:
|
Section
5(a)(v),
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Not
applicable
|
|
Section
5(a)(vi),
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Not
applicable
|
|
Section
5(a)(vii),
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Not
applicable
|
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Section
5(b)(iv),
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Not
applicable
|
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(b)
|
“Specified
Transaction”
will have the meaning specified in Section 14 of this
Agreement.
|
|
(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.
Section
5(a)(ii) (Breach
of Agreement)
will
not apply to Party A or Party B.
Section
5(a)(iii) (Credit
Support Default)
will
not apply to Party A or Party B.
Section
5(a)(iv) (Misrepresentation)
will
not apply to Party A or 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 A or Party B.
Section
5(a)(vii) (Bankruptcy)
will
apply to Party A and Party B; provided that clause (2) thereof shall not
apply
to Party B.
Section
5(a)(viii) (Merger
without Assumption)
will
apply to Party A and will not apply to Party B.
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(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.
Section
5(b)(iii) (Tax
Event upon Merger)
will
apply to Party A and will not apply to Party B.
Section
5(b)(iv) (Credit
Event upon Merger)
will
not apply to Party A or Party B.
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(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) of this Agreement will not apply to Party
A or
Party B.
|
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(f)
|
Payments
on Early Termination.
For the purpose of Section 6(e) of this
Agreement:
|
|
(i)
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Market
Quotation will apply.
|
|
(ii)
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The
Second Method will apply.
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(g)
|
“Termination
Currency”
means United States Dollars.
|
|
(h)
|
Additional
Termination Events.
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
A fails to comply with the Downgrade Provisions as set forth in
Part 5(b).
For all purposes of this Agreement, Party A shall be the sole Affected
Party with respect to the occurrence of a Termination Event described
in
this Part 1(h)(i).
|
|
(ii)
|
The
Pooling and Servicing Agreement dated
as of May 1, 2006 among Long Beach Securities Corp. as Depositor,
Long
Beach Mortgage Company as Servicer, Deutsche Bank National Trust
Company
as Trustee (the “Trustee”)
for the Trust, as
amended and supplemented from time to time (the
“PSA”)
or
other transaction document is amended or modified without the prior
written consent of Party A, where such consent is required under
the terms
of the PSA.
|
|
(iii)
|
The
Trust is terminated pursuant to
PSA.
|
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(iv)
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The
deposit of the Termination Price by the Terminator with the Trust
pursuant
to Section 9.01
of
the PSA on a date that is no later than the Determination Date
in the
month immediately preceding the Distribution Date in which the
Certificates will be retired; provided that the Early Termination
Date may
not occur until a date that is no earlier than the Business Day
after the
Distribution Date falling in the month immediately preceding the
Distribution Date on which the Certificates will
be retired
pursuant to Section 9.01 of the
PSA.
|
Part
2.
Tax
Representations.
|
(a)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement, Party A will
make the
following representation and Party B will make the following
representation:
|
It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this representation,
it
may rely on (i) the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement, (ii) the satisfaction of the
agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the
accuracy and effectiveness of any document provided by the other party pursuant
to Section 4(a)(i) or 4(a)(iii) of this Agreement and (iii) the satisfaction
of
the agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance
is
placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) of this Agreement by reason of material prejudice
to its
legal or commercial position.
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(b)
|
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 to Party
B:
|
|
(1)
|
It
is a resident of The Netherlands for the purpose of the application
of the
existing tax treaties between The Netherlands and those countries
where
offices of Party B are located.
|
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(2)
|
With
respect to its non-U.S. branches, it is fully eligible for the
benefits of
the “Business Profits” or “Industrial and Commercial Profits” provision,
as the case may be, the “Interest” provision or the “Other Income”
provision (if any) of the Specified Treaty with respect to any
payment
described in such provisions and received or to be received by
it in
connection with this Agreement and no such payment is attributable
to a
trade or business carried on by it through a permanent establishment
in
the Specified Jurisdiction. With respect to Party A, Specified
Treaty
means the income tax treaty between the United States and The Netherlands;
Specified Jurisdiction means the United
States.
|
|
(3)
|
With
respect to its U.S. branches, each payment received or to be received
by
it in connection with this Agreement will be effectively connected
with
its conduct of a trade or business in the United
States.
|
|
(ii)
|
Party
B makes
no representations for the purpose of Section 3(f) of this
Agreement.
|
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)
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Tax
forms, documents or certificates to be delivered are:—
None
|
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(b)
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Other
documents to be delivered are:—
|
|
Party
required
to
deliver
document
|
Form/Document/Certificate
|
Date
by which to be
delivered
|
Covered
by
Section 3(d)
Representation
|
|
Party
A
|
Certified
copy of the power of attorney (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.
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Yes
|
|
Party
A and Party B
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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 B
|
An
opinion of counsel to such party reasonably satisfactory in form
and
substance to the other party.
|
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 PSA.
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Within
30 days after the date of this Agreement.
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Yes
|
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Party
B
|
Each
material amendment, supplement or waiver of the PSA, as proposed
from time
to time, or any other amendment or modification of the PSA that
requires
the consent of Party under the terms of the PSA or otherwise adversely
affects Party A’s interests under this Agreement or the ability of Party B
to fully and timely perform its obligations under this
Agreement.
|
Promptly
upon learning of any proposed amendment, supplement or
waiver
|
Yes
|
Part
4.
Miscellaneous.
|
(a)
|
Addresses
for Notices.
For the purposes of Section 12(a) of this Agreement:
|
Party
A:
|
(1)
|
Address
for notices or communications to Party
A:-
|
|
(i)
|
For
all purposes under this Agreement:
|
ABN
AMRO Bank N.V., Chicago Branch
Global
Documentation Unit
▇▇▇
▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
|
Attention:
|
Treasury
Documentation
|
|
Telephone:
|
▇▇▇-▇▇▇-▇▇▇▇
|
|
Fax:
|
▇▇▇-▇▇▇-▇▇▇▇
|
|
(ii)
|
With
a copy to the Office through which Party A is acting for the purposes
of
the relevant Transactions:
|
ABN
AMRO Bank N.V., Amsterdam Head Office
▇.▇.
▇▇▇
▇▇▇
▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
Attention: Operations
Derivatives Markets
Forex
Options
Telephone:
▇▇-▇▇-▇▇▇▇▇▇▇
Telefax: ▇▇-▇▇-▇▇▇▇▇▇▇
Swaps
Telephone:
▇▇-▇▇-▇▇▇▇▇▇▇
Telefax: ▇▇-▇▇-▇▇▇▇▇▇▇
Interest
Related Products
Telephone
▇▇-▇▇-▇▇▇▇▇▇▇
Telefax: ▇▇-▇▇-▇▇▇▇▇▇▇
Credit
Derivatives
Telephone:
▇▇-▇▇-▇▇▇▇▇▇▇
Telefax: ▇▇-▇▇-▇▇▇▇▇▇▇
Telex:
16021
Answerback: ABAM NL
Electronic
Messaging System Details: Swift ABNA NL 2A
ABN
AMRO Bank N.V., Chicago Branch
▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Attention: Treasury
Operations
Telefax: ▇▇▇-▇▇▇-▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Electronic
Messaging System Details: ABNA US 33a XXX
ABN
AMRO Bank N.V., London Branch
▇▇▇
▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇
▇▇▇▇ ▇▇▇,
▇▇▇▇▇▇
▇▇▇▇▇▇▇
Attention:
Fixed
Income Derivatives Documentation
Telex: 887366
Answerback: ABNALN G
Telefax: ▇▇
▇▇
▇▇▇▇ ▇▇▇▇
Telephone: ▇▇
▇▇
▇▇▇▇ ▇▇▇▇
Electronic
Messaging System Details: Swift ABNA ▇▇ ▇▇
|
Party
B:
|
Long
Beach Mortgage Loan Supplemental Interest Trust
2006-4
|
|
c/o:
|
Deutsche
Bank National Trust Company
|
▇▇▇▇
▇▇▇▇
▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇
▇▇▇,
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇
Attention:
Long
Beach Mortgage Loan Supplemental Interest Trust 2006-4
Telephone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
|
(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.
With respect to Party A, the provisions of Section 10(a) will apply
to
this Agreement.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is a Multibranch Party and may act through the following Offices: Amsterdam,
Chicago and London.
Party
B is not a Multibranch Party.
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A.
|
|
(f)
|
Credit
Support Document.
Credit Support Document means
|
With
respect to Party A: The Credit Support Annex (upon the occurrence of a
Collateralization Event or Rating Event, each as defined under Part 5(b))
.
With
respect to Party B: The PSA.
|
(g)
|
Credit
Support Provider.
|
Credit
Support Provider means in relation to Party A: Not applicable.
Credit
Support Provider means in relation to Party B: Not applicable.
|
(h)
|
|
(i)
|
Netting
of Payments.
Subparagraph (ii) of Section 2(c) of this Agreement will apply
to all
Transactions.
|
|
(j)
|
“Affiliate.”
Each of Party A and Party B shall be deemed to have no
Affiliates.
|
Part
5.
Other
Provisions.
|
(a)
|
Definitions.
|
Any
capitalized terms used but not otherwise defined in this Agreement shall
have
the meanings assigned to them (or incorporated by reference) in the PSA.
In the
event of any inconsistency between the terms of this Agreement and the terms
of
the PSA, this Agreement will govern.
|
(b)
|
Downgrade
Provisions.
|
(1) It
shall
be a collateralization event (a “Collateralization
Event”)
if (A)
(i) the unsecured, unguaranteed and otherwise unsupported long-term senior
debt obligations of Party A are rated below “A1” by ▇▇▇▇▇'▇ Investors
Service, Inc. (“Moody's”)
or are
rated “A1” by Moody's and such rating is on watch for possible downgrade (but
only for so long as it is on watch for possible downgrade) and (ii) the
unsecured, unguaranteed and otherwise unsupported short-term debt obligations
of
Party A are rated below “P-1” by Moody's or are rated “P-1” by Moody's and
such rating is on watch for possible downgrade (but only for so long as it
is on
watch for possible downgrade), (B) no short-term rating is available from
Moody's and the unsecured, unguaranteed and otherwise unsupported long-term
senior debt obligations of Party A are rated below “Aa3” by Moody's or are
rated “Aa3” by Moody's and such rating is on watch for possible downgrade (but
only for so long as it is on watch for possible downgrade), or (C) either
(i)
the unsecured, unguaranteed and otherwise unsupported short-term debt
obligations of Party A are rated below “A-1” by Standard & Poor's
Rating Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. (“S&P”)
or
(ii) if Party A does not have a short-term rating from S&P, the
unsecured, unguaranteed and otherwise unsupported long-term senior debt
obligations of Party A are rated below “A+” by S&P or (D) either
(i) the unsecured, unguaranteed and otherwise unsupported long-term senior
debt
obligations of Party A are rated below “A” by Fitch, Inc. (“Fitch”,
and together with Moody’s and S&P, the “Rating
Agencies”)
or (ii) the unsecured, unguaranteed and otherwise unsupported short-term
debt
obligations of Party A are rated below “F-1” by 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 qualify as a Swap Agreement
for
purposes of the distribution priorities in Article IV of the PSA. Within
30 days
from the date a Collateralization Event has occurred and so long as such
Collateralization Event is continuing, Party A shall, at its own expense,
and subject to satisfaction of the Rating Agency Condition either (i) pursuant
to the terms of an ISDA Credit Support Annex, including Paragraph 13, added
to
this Agreement by an amendment to this Agreement (the “Credit
Support Annex”),
post
collateral to Party B in an amount sufficient to restore to the levels that
existed immediately prior to the Collateralization Event the ratings of any
Certificates then rated by the Rating Agencies, (ii) furnish a guarantee
of
Party A's obligations under this Agreement from a guarantor with a long-term
credit rating greater than or equal to “A+” by S&P and “Aa3” by Moody's, or
(iii) obtain a substitute counterparty that (a) is reasonably acceptable
to
Party B, (b) satisfies the Hedge Counterparty Ratings Requirement (as
defined herein) and (c) 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 replaces the outstanding
Transactions hereunder with transactions on identical terms, except that
Party A shall be replaced as counterparty, provided that such substitute
counterparty, as of the date of such assumption or replacement, must 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 must not lead to a termination event or event of default occurring
in respect of the new transactions, as applicable. To the extent that Party
A
elects or is required to post collateral pursuant to this Part 5(b)(1), Party
A
shall request its legal counsel to deliver to each applicable Rating Agency
within thirty (30) calendar days of the occurrence of such Collateralization
Event an opinion satisfactory to the Rating Agency as to the enforceability
of
the Credit Support Annex.
(2) It
shall
be a ratings event (a “Ratings
Event”)
if at
any time after the date hereof Party A shall fail to satisfy the Hedge
Counterparty Ratings Threshold. “Hedge
Counterparty Ratings Threshold”
shall
mean (A) the unsecured, unguaranteed and otherwise unsupported long-term
senior
debt obligations of Party A are rated at least “BBB-” by S&P, (B) the
unsecured, unguaranteed and otherwise unsupported long-term senior debt
obligations of Party A are rated at least “A3” by Moody's (and such rating
is not on watch for possible downgrade) and the unsecured, unguaranteed and
otherwise unsupported short-term debt obligations of Party A are rated at
least “P-2” by Moody's
(and
such rating is not on watch for possible downgrade),
and (C)
either (i) the unsecured, unguaranteed and otherwise unsupported long-term
senior debt obligations of Party A are rated at least “BBB+” by Fitch or
(ii) the unsecured, unguaranteed and otherwise unsupported short-term debt
obligations of Party B 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 qualify as a Swap Agreement for purposes of the distribution
priorities in Section 4.01 of the PSA.
|
(3)
|
Following
a Ratings Event, Party A shall take the following
actions:
|
Within
30
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 business
days) of the Ratings Event, Party A, at its sole expense, shall (i) obtain
a substitute counterparty that (A) satisfies the Rating Agency Condition,
(B)
satisfies the Hedge Counterparty Ratings Requirement and (C) 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 replaces the outstanding Transactions hereunder with
transactions on identical terms, except that Party A shall be replaced as
counterparty, provided that such substitute counterparty, as of the date
of such
assumption or replacement, must 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 must not
lead to
a termination event or event of default occurring in respect of the new
transactions, as applicable, and (ii) on or prior to the expiration of such
period pursuant to a Credit Support Annex adopted as set forth in Part 5(b)(1),
post collateral to Party B in an amount sufficient to restore to the levels
that
existed immediately prior to the Ratings Event the ratings of any Certificates
then rated by one or more Rating Agencies. Notwithstanding anything contained
herein to the contrary, if Party A is required to transfer its rights and
obligations under this Agreement pursuant to this Part 5(b)(3) as a result
of a
rating issued by S&P, Party A shall, at all times prior to such transfer, be
required to post collateral in accordance with (i) the terms of the Credit
Support Annex or (ii) an agreement with Party B providing for the posting
of
collateral, which agreement shall satisfy the Rating Agency Condition specified
in Part 5(n) below and require Party A to post the required
collateral.
“Hedge
Counterparty Ratings Requirement”
shall
mean (a) either (i) the unsecured, unguaranteed and otherwise unsupported
short-term debt obligations of the substitute counterparty 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, unguaranteed and otherwise
unsupported long-term senior debt obligations of the substitute counterparty
are
rated at least “A+” by S&P, (b) either (i) the unsecured, unguaranteed and
otherwise unsupported long-term senior debt obligations of such substitute
counterparty are rated at least “A1” by Moody's (and if rated “A1” by Moody's,
such rating is not on watch for possible downgrade) and the unsecured,
unguaranteed and otherwise unsupported short-term debt obligations of such
substitute counterparty are rated at least “P-1” by Moody's (and if rated “P-1”
by Moody's, such rating is not on watch for possible downgrade and remaining
on
watch for possible downgrade), or (ii) if such substitute counterparty does
not
have a short-term debt rating from Moody's, the unsecured, unguaranteed and
otherwise unsupported long-term senior debt obligations of such substitute
counterparty are rated at least “Aa3” by Moody's (and if rated “Aa3” by Moody's,
such rating is not on watch for possible downgrade), and (c) either (i) the
unsecured, unguaranteed and otherwise unsupported long-term senior debt
obligations of such substitute counterparty are rated at least “A” by Fitch or
(ii) the unsecured, unguaranteed and otherwise unsupported short-term debt
obligations of such substitute counterparty 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.
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(c)
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Section
3(a) of this Agreement is hereby amended to include the following
additional representations after paragraph
3(a)(v):
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(vi)
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Eligible
Contract Participant.
It
is an “eligible contract participant” as defined in section 1a(12) of the
U.S. Commodity Exchange Act.
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(vii)
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Individual
Negotiation.
This Agreement and each Transaction hereunder is subject to individual
negotiation by the parties.
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(viii)
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Relationship
between Party A and Party B.
Subject as provided in Part 5(g), 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):
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(1)
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Principal.
It
is acting as principal and not as agent when entering into this
Agreement
and each Transaction.
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(2)
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Non-Reliance.
It
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.
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.
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(3)
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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.
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(4)
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Status
of Parties. The
other party is not acting as a fiduciary or an advisor for it in
respect
of that Transaction.
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(d)
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Section
1(c). For
purposes of Section 1(c) of the Agreement, the Transaction with
the
External ID number 2383872 shall be the sole Transaction under
the
Agreement.
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(e)
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Transfer.
Section
7 is hereby amended to read in its entirety as
follows:
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Except
as
stated under Section 6(b)(ii), neither Party A nor Party B is permitted to
assign, novate or transfer (whether by way of security or otherwise) as a
whole
or in part any of its rights,
obligations or interests under this Agreement or any Transaction without
the
prior written consent of the other party; provided, however, that (i) Party
A
may make such a transfer of this Agreement pursuant to a consolidation or
amalgamation with, or merger with or into, or transfer of substantially all
of
its assets to, another entity, or an incorporation, reincorporation or
reconstitution, and (ii) Party A may transfer this Agreement to any Person
that
is an office, branch or affiliate of Party A (any such Person, office, branch
or
affiliate, a “Transferee”)
on at
least five Business Days' prior written notice to Party B; provided that,
with
respect to clause (ii), (A) 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; (B) a Termination Event or Event of Default does not occur under
this Agreement as a result of such transfer; (C) such notice is accompanied
by a
written instrument pursuant to which the Transferee acquires and assumes
the
rights and obligations of Party A so transferred; and (D) Party A will be
responsible for any costs or expenses incurred in connection with such transfer.
Party B will execute such documentation as is reasonably deemed necessary
by
Party A for the effectuation of any such transfer. Notwithstanding the
foregoing, no such transfer shall be made unless the transferring party obtains
a written confirmation from each of the Rating Agencies that, notwithstanding
such transfer, the then-current ratings of the
Class
A Certificates, the Mezzanine Certificates and the Class B Certificates
will
not be reduced
or
withdrawn.
Except
as specified otherwise in the documentation evidencing a transfer, a transfer
of
all the obligations of Party A made in compliance with this Section 7 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.
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(f)
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Trustee
Capacity. It
is expressly understood and agreed by the parties hereto that (i)
this
Agreement is executed and delivered by the Trustee not individually
or
personally but solely as trustee of the Trust, in the exercise
of the
powers and authority conferred and vested in it under the PSA,
(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 Trustee 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
Trustee,
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 Trustee
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 Agreement 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 PSA.
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(g)
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Additional
Representations.
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Party
B
represents that:
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(i)
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Status.
The Trustee is trustee of the Trust whose appointment is valid
and
effective both under the laws of the State of New York and under
the PSA,
and the Trustee has the power to own assets in its capacity as
trustee of
the Trust.
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(ii)
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Powers.
In its capacity as trustee of the Trust, the Trustee has power
under the
PSA to execute this Agreement and any other documentation relating
to this
Agreement that the Trustee is executing and delivering on behalf
of the
Trust, to deliver this Agreement and any other documentation relating
to
this Agreement that it is required to execute and deliver and to
perform
the obligations (on behalf of the Trust) under this Agreement and
any
obligations (on behalf of the Trust) under any Credit Support Document
to
which the Trust is party and has taken all necessary action to
authorize
such execution, delivery and
performance;
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(iii)
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No
violation or conflict. Such execution, delivery and performance
do not
violate or conflict with any law applicable to the Trustee or the
Trust,
any provision of the PSA, any order or judgment of any court or
other
agency of government applicable to the Trustee, the Trust or any
assets of
the Trust, or any contractual restriction binding on or affecting
the
Trustee, the Trust or any assets of the
Trust;
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(iv)
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Consents.
All governmental and other consents that are required have been
obtained
by the Trust with respect to this Agreement or any Credit Support
Document
to which the Trust is party have been obtained and are in full
force and
effect and all conditions of such consents have been complied with;
and
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(v)
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Obligations
binding. The obligation of the Trust under this Agreement and any
Credit
Support Document to which the Trust is party constitute legal,
valid and
binding obligations of the Trust, enforceable against the Trust
in
accordance with their respective terms (subject to applicable bankruptcy,
reorganization, 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 law)) and no
circumstances are known to the Trust or the Trustee which would
or might
prevent the Trustee from having recourse to the assets of the Trust
for
the purposes of meeting such
obligations.
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(h)
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Proceedings.
Without impairing any right afforded to it under the PSA 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
Trust, any bankruptcy, reorganization, arrangement, insolvency
or
liquidation proceedings, or other proceedings under any federal
or state
bankruptcy, dissolution or similar law, for a period of one year
and one
day, or
if longer the applicable preference period then in effect,
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
Mortgage Loans any legal action which is not a bankruptcy, reorganization,
arrangement, insolvency, moratorium, liquidation or similar proceeding.
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(i)
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Change
of Account.
Section 2(b) of this Agreement is hereby amended by the addition
of the
following after the word “delivery” in the first line
thereof:-
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“to
another account in the same legal and tax jurisdiction as the original
account”
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(j)
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Pooling
and Servicing Agreement.
Party
B will provide at least ten days' prior written notice to Party
A of any
proposed amendment or modification to the PSA and Party B will
obtain the prior written consent of Party A to any such amendment
or
modification, where such notice and consent are required under
the terms
of the PSA.
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(k)
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Set-off.
Notwithstanding
any provision of this Agreement or any other existing or future
agreements, each of Party A and Party B irrevocably waives as to
itself
any and all contractual rights it may have to set off, net, recoup
or
otherwise withhold or suspend or condition its payment or performance
of
any obligation to the other party under this Agreement against
any
obligation of one party hereto to the other party hereto arising
outside
of this Agreement. The provisions for set-off set forth in Section
6(e) of
this Agreement shall not apply for purposes of this
Transaction.
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(l)
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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(l) shall not constitute
an
Event of Default or a Termination
Event.
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(m)
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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) the preparation of or passing
on
the disclosure and other information contained in any offering
circular
for the Certificates, the PSA, or any other agreements or documents
used
by Party B or any other party in connection with the marketing
and sale of
the Certificates (other than information provided by Party A for
purposes
of the disclosure document relating to the Class
A Certificates, the Mezzanine Certificates and the Class B
Certificates;
(vi) the ongoing operations and administration of Party B, including
the
furnishing of any information to Party B which is not specifically
required under this Agreement; or (vii) any other aspect of Party
B's
existence.
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(n)
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Amendments
and Rating Agency Condition.
Without prejudice to Section 9 of this Agreement, this Agreement
will not
be amended unless the Rating Agency Condition is satisfied with
respect to
such amendment. “Rating Agency Condition” means, with respect to any
particular proposed act or omission to act hereunder that the party
acting
or failing to act must consult with each of S&P, Fitch and ▇▇▇▇▇’▇
then providing a rating of the Class A Certificates, the Mezzanine
Certificates and the Class B Certificates
and receive a prior written confirmation from each of the Rating
Agencies
that S&P, ▇▇▇▇▇’▇ or Fitch will not downgrade or withdraw its
then-current ratings of any outstanding Class A Certificates, the
Mezzanine Certificates or the Class B
Certificates.
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(o)
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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.
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(p)
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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.
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(q)
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Consent
to Recording.
Each party (i) consents to the recording of the telephone conversations
of
trading and marketing personnel of the parties in connection with
this
Agreement or any potential transaction and (ii) if applicable,
agrees to
obtain any necessary consent of, and give notice of such recording
to,
such personnel.
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(r)
|
Independent
Reliance.
The parties agree to amend Section 3 of this Agreement by the addition
of
the following provision at the end thereof and marked as subsection
(g).
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“(g)
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Independent
Reliance. Party
A is entering into this Agreement and will enter into each Transaction
in
reliance upon such tax, accounting, regulatory, legal, and financial
advice as it deems necessary and not upon any view expressed by
the other
party. Party B is entering into this Agreement and will enter into
each
Transaction in reliance upon the direction of the Depositor and
not upon
any view expressed by the other
party.”
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(s)
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Escrow
Payments.
If
(whether by reason of the time difference between the cities in
which
payments are to be made or otherwise) it is not possible for simultaneous
payments to be made on any date on which both parties are required
to make
payments hereunder, either party may at its option and in its sole
discretion notify the other party that payments on that date are
to be
made in escrow. In this case deposit of the payment due earlier
on that
date shall be made by 2:00 pm (local time at the place for the
earlier
payment) on that date with an escrow agent selected by the notifying
party, accompanied by irrevocable payment instructions (i) to release
the
deposited payment to the intended recipient upon receipt by the
escrow
agent of the required deposit of the corresponding payment from
the other
party on the same date accompanied by irrevocable payment instructions
to
the same effect or (ii) if the required deposit of the corresponding
payment is not made on that same date, to return the payment deposited
to
the party that paid it into escrow. The party that elects to have
payments
made in escrow shall pay all costs of the escrow
arrangements.
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(t)
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[Reserved.]
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(u)
|
Method
of Notice.
Section 12(a)(ii) of this Agreement is deleted in its
entirety.
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(v)
|
USA
PATRIOT Act Notice.
Party A hereby notifies Party B that pursuant to the requirements
of the
USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October
26,
2001)) (the “Act”),
it is required to obtain, verify and record information that identifies
Party B, which information includes the name and address of Party
B and
other information that will allow Party A to identify Party B in
accordance with the Act.
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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.
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ABN
AMRO BANK, N.V.
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LONG
BEACH MORTGAGE LOAN SUPPLEMENTAL
INTEREST TRUST
2006-4
By
Deutsche Bank National Trust Company, not in its individual capacity
but
solely as Trustee on behalf of Long Beach Mortgage Loan
Supplemental
Interest Trust
2006-4
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By:__________________________
Name:
Title:
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By:_______________________________
Name:
Title:
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By:__________________________
Name:
Title:
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By:__________________________
Name:
Title:
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