Rate Cap Transaction Re: BNY Reference No. 38494
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Dated:
October 31, 2006
Re:
BNY
Reference No. 38494
Ladies
and Gentlemen:
The
purpose of this letter agreement (“Agreement”)
is to
confirm the terms and conditions of the rate Cap Transaction entered into on
the
Trade Date specified below (the “Transaction”)
between The Bank of New York (“BNY”),
a
trust company duly organized and existing under the laws of the State of New
York, and Deutsche
Bank National Trust Company, not in its individual capacity, but solely as
administrator (in such capacity, the “Administrator”) under the Yield
Maintenance Allocation Agreement (the “Yield Maintenance Allocation Agreement”)
dated as of October 31, 2006, among the Administrator, Greenwich Capital
Financial Products, Inc. (“GCFP”) and Deutsche Bank National Trust Company, not
in its individual capacity, but solely as trustee ( the “Trustee”) under the
Pooling and Servicing Agreement, dated as of October 31, 2006, among Greenwich
Capital Acceptance, Inc., as depositor (the “Depositor”), GCFP, as seller (the
“Seller”) and the Trustee (the “Pooling
and Servicing Agreement”).
The Administrator, on behalf of the Harborview 2006-SB1 Yield Maintenance Trust
is referred to herein as the “Counterparty”. This
Agreement, which evidences a complete and binding agreement between you and
us
to enter into the Transaction on the terms set forth below, constitutes a
“Confirmation”
as
referred to in the “ISDA
Form Master Agreement”
(as
defined below), as well as a “Schedule” as referred to in the ISDA Form Master
Agreement.
1. Form
of Agreement.
This Agreement is subject to the 2000
ISDA Definitions (the
“Definitions”),
as published by the International Swaps and Derivatives Association, Inc.
(“ISDA”).
You and we have agreed to enter into this Agreement in lieu of negotiating
a
Schedule to the 1992 ISDA Master Agreement (Multicurrency—Cross Border) form
(the “ISDA
Form Master Agreement”).
An ISDA Form Master Agreement, as modified by the Schedule terms in Paragraph
4
of this Confirmation (the “Master
Agreement”),
shall be deemed to have been executed by you and us on the date we entered
into
the Transaction. Except as otherwise specified, references herein to Sections
shall be to Sections of the ISDA Form Master Agreement and the Master Agreement,
and references to Paragraphs shall be to paragraphs of this Agreement. In the
event of any inconsistency between the provisions of this Agreement and the
Definitions or the ISDA Form Master Agreement, this Agreement shall prevail
for
purposes of the Transaction. Capitalized terms not otherwise defined herein
or
in the Definitions or the Master Agreement shall have the meaning defined for
such term in the Pooling and Servicing Agreement.
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2.
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Certain
Terms.
The terms of the particular Transaction to which this Confirmation
relates
are as follows:
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Type
of Transaction:
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Rate
Cap
|
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Notional
Amount:
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With
respect to any Calculation Period lesser of: (i) the amount set forth
for
such period on Schedule I attached hereto for
such Calculation Period
and (ii) the aggregate principal balance of the Class A-1A, Class
▇-▇▇,
▇▇▇▇▇ ▇-▇, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6
and Class
M-7 Certificates (as
defined in the Pooling and Servicing Agreement) for such Floating
Rate
Payer Payment Date.
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The
Administrator shall make available each month via the Administrator’s
website a statement containing the aggregate Certificate Principal
Balance
of the Class
A-1A, Class ▇-▇▇, ▇▇▇▇▇ ▇-▇, Class M-2, Class M-3, Class M-4, Class
M-5,
Class M-6 and Class M-7 Certificates
as
of the first day of such Calculation Period and shall notify BNY
at least
five (5) Business Days prior to the related Floating Rate Payer Payment
Date of the aggregate Certificate Principal Balance of the Class
A-1A, Class ▇-▇▇, ▇▇▇▇▇ ▇-▇, Class M-2, Class M-3, Class M-4, Class
M-5,
Class M-6 and Class M-7 Certificates
as
of the first day of such Calculation Period and shall send such
notification to BNY provided, however, that if the Administrator
shall not
provide such notification, BNY is permitted to rely upon the statement
of
Certificate Principal Balance of the Class
A-1A, Class ▇-▇▇, ▇▇▇▇▇ ▇-▇, Class M-2, Class M-3, Class M-4, Class
M-5,
Class M-6 and Class M-7 Certificates
made available on the Administrator’s website. The Administrator’s
internet website shall initially be located at ▇▇▇▇▇://▇▇▇.▇▇▇.▇▇.▇▇▇/▇▇▇▇
and assistance in using the website can be obtained by calling the
the
Administrator’s investor relations desk at (▇▇▇)
▇▇▇-▇▇▇▇.
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Trade
Date:
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October
30, 2006
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Effective
Date:
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November
19, 2008
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Termination
Date:
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August
19, 2012, subject to adjustment in accordance with the Following
Business
Day Convention.
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FIXED
AMOUNTS
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Fixed
Amount Payer:
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Counterparty
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Fixed
Amount:
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USD
249,000.00
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Fixed
Amount Payer
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Payment
Date:
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October
31, 2006
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FLOATING
AMOUNTS
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Floating
Rate Payer:
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BNY
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Cap
Rate:
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For
each Calculation Period, as set forth for such period on Schedule
I
attached hereto.
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Floating
Rate for initial
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Calculation
Period:
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To
be determined
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Floating
Rate Day Count
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Fraction:
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Actual/360
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Floating
Rate Option:
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USD-LIBOR-BBA,
provided, however, if the Floating Rate Option for a Calculation
Period is
greater than 9.00% then the Floating Rate Option for such Calculation
Period shall be deemed equal to 9.00%.
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Designated
Maturity:
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One
month
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Spread:
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Inapplicable
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Floating
Rate Payer
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Period
End Dates:
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The
19th
day of each month, beginning on December 19, 2008 and ending on the
Termination Date, subject to adjustment in accordance with the Following
Business Day Convention.
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Floating
Rate Payer
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Payment
Dates:
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Early
Payment shall be applicable. The Floating Rate Payer Payment Date
shall be
one (1) Business Day preceding each Floating Rate Payer Period End
Date.
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Reset
Dates:
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The
first day of each Calculation Period or Compounding Period, if Compounding
is applicable.
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Compounding:
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Inapplicable
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Business
Days for Payments
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By
both parties:
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Calculation
Agent:
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BNY
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3.
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Additional
Provisions:
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1) Reliance.
Each
party hereto is hereby advised and acknowledges that the other party has engaged
in (or refrained from engaging in) substantial financial transactions and has
taken (or refrained from taking) other material actions in reliance upon the
entry by the parties into the Transaction being entered into on the terms and
conditions set forth herein.
2) Transfer,
Amendment and Assignment.
No
transfer, amendment, waiver, supplement, assignment or other modification of
this Transaction shall be permitted by either party unless each of Standard
& Poor’s Ratings Service, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc
(“S&P”),
▇▇▇▇▇’▇ Investors Service, Inc. (“Moody’s”)
and
Dominion Bond Rating Service (“DBRS”),
has
been provided notice of the same and confirms in writing (including by facsimile
transmission) that it will not downgrade, qualify, withdraw or otherwise modify
its then-current ratings on the Certificates issued under the Pooling and
Servicing Agreement (the “Certificates”).
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4.
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Provisions
Deemed Incorporated in a Schedule to the Master
Agreement:
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1)
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No
Netting Between Transactions.
The parties agree that subparagraph (ii) of Section 2(c) will apply
to any
Transaction.
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2)
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Termination
Provisions.
Subject to the provisions of Paragraph 4(11) below, for purposes
of the
Master Agreement:
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(a)
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“Specified
Entity”
is not applicable to BNY or the Counterparty for any purpose.
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(b)
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The
“Breach
of Agreement”
provision of Section 5(a)(ii) will not apply to BNY or the
Counterparty.
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(c)
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The
“Credit
Support Default”
provisions of Section 5(a)(iii) will not apply to BNY (except with
respect
to credit support furnished pursuant to Paragraph 4 9) below or the
Counterparty.
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(d)
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The
“Misrepresentation”
provisions of Section 5(a)(iv) will not apply to BNY or the
Counterparty.
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(e)
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“Default
under Specified Transaction”
is not applicable to BNY or the Counterparty for any purpose, and,
accordingly, Section 5(a)(v) shall not apply to BNY or the
Counterparty.
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(f)
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The
“Cross
Default”
provisions of Section 5(a)(vi) will not apply to BNY or to the
Counterparty.
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(g)
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The
“Bankruptcy”
provisions of Section 5(a)(vii)(2) will not apply to the Counterparty;
the
words “trustee” and “custodian” in Section 5(a)(vii)(6) will not include
the Trustee; and the words “specifically authorized ” are inserted before
the word “action” in Section
5(a)(vii)(9).
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(h)
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The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to BNY or the
Counterparty.
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(i)
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The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to BNY or to the
Counterparty.
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(j)
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Payments
on Early Termination.
For the purpose of Section 6(e):
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(i)
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Market
Quotation will apply.
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(ii)
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The
Second Method will apply.
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(k)
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“Termination
Currency”
means United States Dollars.
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(l)
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No
Additional Amounts Payable by Counterparty.
The Counterparty shall not be required to pay any additional amounts
pursuant to Section 2(d)(i)(4) or
2(d)(ii).
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3)
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Tax
Representations.
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(a)
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Payer
Representations.
For the purpose of Section 3(e), BNY and the Counterparty make the
following representations:
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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)) to be made by it to the
other party under this Agreement. In making this representation, it may rely
on:
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(i)
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the
accuracy of any representations made by the other party pursuant
to
Section 3(f);
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(ii)
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the
satisfaction of the agreement contained in Section 4 (a)(i) or 4(a)(iii)
and the accuracy and effectiveness of any document provided by the
other
party pursuant to Section 4 (a)(i) or 4(a)(iii);
and
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(iii)
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the
satisfaction of the agreement of the other party contained in Section
4(d), 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) by reason of material prejudice
of its legal or commercial position.
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(b)
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Payee
Representations.
For the purpose of Section 3(f), BNY and the Counterparty make the
following representations.
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(i)
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The
following representation will apply to BNY:
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(x)
It is
a “U.S. person” (as that term is used in section 1.1441-4(a)(3)(ii) of the
United States Treasury Regulations) for United States federal income tax
purposes, (y) it is a trust company duly organized and existing under the laws
of the State of New York, and (y) its U.S. taxpayer identification number is
▇▇▇▇▇▇▇▇▇.
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(ii)
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The
following representation will apply to the
Counterparty:
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The
beneficial owner of payments made to it under this Agreement is a “U.S. person”
(as that term is used in section 1.1441-4(a)(3)(ii) of United States Treasury
Regulations) for United States federal income tax purposes.
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4)
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Documents
to be delivered. For the purpose of Section
4(a):
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(a)
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Tax
forms, documents or certificates to be delivered
are:
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Party
required to
deliver
document
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Form/Document/
Certificate
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Date
by which
to
be delivered
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Covered
by Section
3(d)
Representation
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BNY
and Counterparty
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Any
document required or
reasonably requested to allow the other party to make payments
under this
Agreement without any deduction or withholding for or on the account
of
any tax.
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Upon
the execution and delivery of this Agreement
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Yes
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(b)
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Other
documents to be delivered are:
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Party
required to
deliver
document
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Form/Document/
Certificate
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Date
by which
to
be delivered
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Covered
by Section
3(d)
Representation
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BNY
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A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing this
Agreement, any relevant Credit Support Document, or any Confirmation,
as
the case may be.
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Upon
the execution and delivery of this Agreement
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Yes
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Counterparty
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(i)
a copy of the executed Pooling and Servicing Agreement, Yield Maintenance
Allocation Agreement and (ii) an incumbency certificate verifying
the true
signatures and authority of the person or persons signing this
letter
agreement on behalf of the Counterparty.
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Upon
the execution and delivery of this Agreement
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Yes
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BNY
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A
copy of the most recent publicly available regulatory call
report.
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Promptly
after request by the other party
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Yes
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BNY
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Legal
Opinion as to enforceability of the Agreement.
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Upon
the execution and delivery of this Agreement.
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Yes
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5)
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Miscellaneous.
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(a)
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Address
for Notices:
For the purposes of Section 12(a):
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Address
for notices or communications to BNY:
The
Bank
of New York
Swaps
and
Derivative Products Group
Global
Market Division
▇▇
▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ ▇▇▇▇▇▇
with
a
copy to:
The
Bank
of New York
Swaps
and
Derivative Products Group
▇▇
▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Tele:
▇▇▇-▇▇▇-▇▇▇▇
Fax:
▇▇▇-▇▇▇-▇▇▇▇/5837
(For
all
purposes)
Address
for notices or communications to the Counterparty:
Deutsche
Bank National Trust Company
▇▇▇▇
▇▇▇▇ ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
Harborview 2006-SB1
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(b)
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Process
Agent.
For the purpose of Section 13(c):
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BNY
appoints as its Process Agent: Not
Applicable
The
Counterparty appoints as its Process
Agent: Not Applicable
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(c)
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Offices.
The provisions of Section 10(a) will not apply to this Agreement;
neither
BNY nor the Counterparty have any Offices other than as set forth
in the
Notices Section and BNY agrees that, for purposes of Section 6(b),
it
shall not in future have any Office other than one in the United
States.
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(d)
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Multibranch
Party.
For the purpose of Section 10(c):
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BNY
is
not a Multibranch Party.
The
Counterparty is not a Multibranch Party.
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(e)
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Calculation
Agent.
The Calculation Agent is BNY.
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(f)
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Credit
Support Document.
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Not
applicable for either BNY (except with respect to credit support
furnished
pursuant to Paragraph 9) or the Counterparty.
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(g)
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Credit
Support Provider.
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BNY:
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Not
Applicable (except with respect to credit support furnished pursuant
to
Paragraph 9)
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Counterparty:
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Not
Applicable
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(h)
|
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(i)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement, or
the
application thereof to any party or circumstance, shall be held to
be
invalid or unenforceable (in whole or in part) for any reason, the
remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if this Agreement had been executed
with the invalid or unenforceable portion eliminated, so long as
this
Agreement as so modified continues to express, without material change,
the original intentions of the parties as to the subject matter of
this
Agreement and the deletion of such portion of this Agreement will
not
substantially impair the respective benefits or expectations of the
parties.
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The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
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(j)
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Recording
of Conversations.
Each party (i) consents to the recording of telephone conversations
between the trading, marketing and other relevant personnel of the
parties
in connection with this Agreement or any potential Transaction, (ii)
agrees to obtain any necessary consent of, and give any necessary
notice
of such recording to, its relevant personnel and (iii) agrees, to
the
extent permitted by applicable law, that recordings may be submitted
in
evidence in any Proceedings.
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(k)
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Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in respect
of
any Proceedings relating to this Agreement or any Credit Support
Document.
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(l)
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Non-Recourse.
Notwithstanding any provision herein or in the ISDA Form Master Agreement
to the contrary, the obligations of the Counterparty hereunder are
limited
recourse obligations of the Counterparty, payable solely from the
Harborview Mortgage Loan Trust 2006-SB1 created pursuant to the Pooling
and Servicing Agreement (the “Issuing Entity”) and the proceeds thereof to
satisfy the Counterparty's obligations hereunder. In the event that
the
Issuing Entity and proceeds thereof should be insufficient to satisfy
all
claims outstanding and following the realization of the Issuing Entity
and
the distribution of the proceeds thereof in accordance with the Pooling
and Servicing Agreement, any claims against or obligations of the
Counterparty under the ISDA Form Master Agreement or any other
confirmation thereunder, still outstanding shall be extinguished
and
thereafter not revive. This provision shall survive the expiration
of this
Agreement.
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(m)
|
Limitation
on Institution of Bankruptcy Proceedings.
BNY shall not institute against or cause any other person to institute
against, or join any other person in instituting against the Counterparty,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, under any of the laws of the United States or any other
jurisdiction, for a period of one year and one day (or, if longer,
the
applicable preference period) following indefeasible payment in full
of
the Certificates. This provision shall survive the expiration of
this
Agreement.
|
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(n)
|
Remedy
of Failure to Pay or Deliver.
The ISDA Form Master Agreement is hereby amended by replacing the
word
“third” in the third line of Section 5(a)(i) by the word
“second”.
|
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(o)
|
“Affiliate”
will have the meaning specified in Section 14 of the ISDA Form Master
Agreement, provided that the Counterparty shall not be deemed to
have any
Affiliates for purposes of this Agreement, including for purposes
of
Section 6(b)(ii).
|
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(p)
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Administrator’s
Capacity.
It is expressly understood and agreed by the parties hereto that
insofar
as this Confirmation is executed by the Administrator (i) this
Confirmation is executed and delivered by
Deutsche Bank National Trust Company,
not in its individual capacity but solely as Administrator pursuant
to the
Yield Maintenance Allocation Agreement in the exercise of the powers
and
authority conferred and vested in it thereunder and pursuant to
instruction set forth therein (ii) each of the representations,
undertakings and agreements herein made on behalf of the trust is
made and
intended not as a personal representation, undertaking or agreement
of the
Administrator but
is made and intended for the purpose of binding only the Counterparty,
and
(iii) under no circumstances will Deutsche
Bank National Trust Company ,
in its individual capacity be personally liable for the payment of
any
indebtedness or expenses or be personally liable for the breach or
failure
of any obligation, representation, warranty or covenant made or undertaken
under this Confirmation.
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(q)
|
Administrator’s
Representation.
Deutsche
Bank National Trust Company,
as Administrator, represents and warrants
that:
|
It
has
been directed under the Yield Maintenance Allocation Agreementto enter into
this
letter agreement as Administrator on behalf of the Counterparty.
|
(r)
|
Amendment
to the Yield Maintenance Allocation Agreement and the Pooling and
Servicing Agreement.
Notwithstanding any provisions to the contrary in the Yield Maintenance
Allocation Agreement and the Pooling and Servicing Agreement, none
of the
Depositor, Seller, or the Administrator shall enter into any amendment
thereto which could have a material adverse affect on BNY without
the
prior written consent of BNY.
|
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6)
|
Additional
Representations.
Section
3 is hereby amended by adding, at the end thereof, the following
Sections
3(g) and 3(h):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
It
is not relying on any statement or representation of the other party
regarding the Transaction (whether written or oral), other than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction.
|
(2) Evaluation
and Understanding.
|
(i)
|
Each
Party acknowledges that Deutsche
Bank National Trust Company,
has been directed under the Yield Maintenance Allocation Agreementto
enter
into this Transaction as Administrator on
behalf of the Counterparty.
|
|
(ii)
|
It
is acting for its own account and has the capacity to evaluate (internally
or through independent professional advice) the Transaction and has
made
its own decision to enter into the Transaction; it is not relying
on any
communication (written or oral) of the other party as investment
advice or
as a recommendation to enter into such transaction; it being understood
that information and explanations related to the terms and conditions
of
such transaction shall not be considered investment advice or a
recommendation to enter into such 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 the transaction;
and
|
|
(iii)
|
It
understands the terms, conditions and risks of the Transaction and
is
willing and able to accept those terms and conditions and to assume
(and
does, in fact assume) those risks, financially and otherwise.
|
|
(3)
|
Principal.
The
other party is not acting as a fiduciary or an advisor for it in
respect
of this Transaction.
|
Page
12 of 21
|
(h)
|
Exclusion
from Commodities Exchange Act.
(A)
It is an “eligible contract participant” within the meaning of Section
1a(12) of the Commodity Exchange Act, as amended; (B) this Agreement
and
each Transaction is subject to individual negotiation by such party;
and
(C) neither this Agreement nor any Transaction will be executed or
traded
on a “trading facility” within the meaning of Section 1a(33) of the
Commodity Exchange Act, as amended.
|
|
7)
|
Set-off.
Notwithstanding any provision of this Agreement or any other existing
or
future agreement (but without limiting the provisions of Section
2(c) and
Section 6, except as provided in the next sentence), each party
irrevocably waives any and all rights it may have to set off, net,
recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against any
obligation between it and the other party under any other agreements.
The
last sentence of the first paragraph of Section 6(e) shall not apply
for
purposes of this Transaction.
|
|
8)
|
Additional
Termination Events.
The following Additional Termination Events will apply, in
each case with respect to BNY as the sole Affected Party (unless
otherwise
provided below):
|
(i) Downgrade.
BNY
fails to comply with the Downgrade Provisions as set forth in Paragraph 4(9).
BNY shall be the sole Affected Party.
(ii) Provision
of Information Required by Regulation AB.
BNY
shall fail to comply with the provisions of Paragraph 4(10) below within the
time provided for therein. BNY shall be the sole Affected Party.
9) Ratings
Downgrade. For
purposes of each Transaction:
|
(i)
|
Certain
Definitions.
|
(A) “Rating
Agency Condition”
means,
with respect to any particular proposed act or omission to act hereunder, that
the Administrator shall have received prior written confirmation from each
of
the applicable Rating Agencies, and shall have provided notice thereof to BNY,
that the proposed action or inaction would not cause a downgrade or withdrawal
of their then-current ratings of the Certificates.
(B) “Qualifying
Ratings”
means,
with respect to the debt of any assignee or guarantor under Paragraph 4(9)(ii)
below,
(x) a
short-term unsecured and unsubordinated debt rating of “P-1” (not on watch for
downgrade), and a long-term unsecured and unsubordinated debt of ”A1” (not on
watch for downgrade) (or, if it has no short-term unsecured and unsubordinated
debt rating, a long term rating of “Aa3” (not on watch for downgrade) by
Moody’s, and
(y) a
short-term unsecured and unsubordinated debt rating of “A-1” by S&P or a
long-term unsecured and unsubordinated debt rating of “A+” by
S&P.
(C) A
“Collateralization
Event”
shall
occur with respect to BNY (or any applicable credit support provider)
if:
(x) its
short-term unsecured and unsubordinated debt rating is reduced to “P-1” (and is
on watch for downgrade) or below, and its long-term unsecured and unsubordinated
debt is reduced to ”A1” (and is on watch for downgrade) or below (or, if it has
no short-term unsecured and unsubordinated debt rating, its long term rating
is
reduced to “Aa3” (and is on watch for downgrade) or below) by Moody’s,
or
(y) its
short-term unsecured and unsubordinated debt rating is reduced below “A-1” or
its long-term unsecured and unsubordinated debt rating of “A+” by
S&P.
(D) A
“Ratings
Event”
shall
occur with respect to BNY (or any applicable credit support provider)
if:
(x) its
short-term unsecured and unsubordinated debt rating is withdrawn or reduced
to
“P-2” or below by Moody’s and its long-term unsecured and unsubordinated debt is
reduced to “A3” or below (or, if it has no short-term unsecured and
unsubordinated debt rating, its long term rating is reduced to “A2” or below) by
Moody’s, or
(y) its
long-term unsecured and unsubordinated debt rating is withdrawn or reduced
below
“BBB-” by S&P.
For
purposes of (C) and (D) above, such events include those occurring in connection
with a merger, consolidation or other similar transaction by BNY or any
applicable credit support provider, but they shall be deemed not to occur if,
within thirty (30) days (or, in the case of a Ratings Event, ten (10) Business
Days) thereafter, each of the applicable Rating Agencies has reconfirmed the
ratings of the Certificates, as applicable, which were in effect immediately
prior thereto. For the avoidance of doubt, a downgrade of the rating on the
Certificates could occur in the event that BNY does not post sufficient
collateral.
(ii) Actions
to be Taken Upon Occurrence of Event.
Subject, in each case set forth in (A) and (B) below, to satisfaction of the
Rating Agency Condition:
(A) Collateralization
Event.
If a
Collateralization Event occurs with respect to BNY (or any applicable credit
support provider), then BNY shall, at its own expense, within thirty (30) days
of such Collateralization Ratings Event:
(1) post
collateral under agreements and other instruments approved by the Counterparty,
such approval not to be unreasonably withheld, which will be sufficient to
restore the immediately prior ratings of the Certificates,
(2) assign
the Transaction to a third party, the ratings of the debt of which (or of the
guarantor of which) meet or exceed the Qualifying Ratings, on terms
substantially similar to this Confirmation, which party is approved by the
Counterparty, such approval not to be unreasonably withheld,
(3) obtain
a guaranty of, or a contingent agreement of, another person, the ratings of
the
debt of which (or of the guarantor of which) meet or exceed the Qualifying
Ratings, to honor BNY’s obligations under this Agreement, provided
that
such
other person is approved by the Counterparty, such approval not to be
unreasonably withheld, or
(4) establish
any other arrangement approved by the Counterparty, such approval not to be
unreasonably withheld, which will be sufficient to restore the immediately
prior
ratings of their Certificates.
(B) Ratings
Event.
If a
Ratings Event occurs with respect to BNY (or any applicable credit support
provider), then BNY shall, at its own expense, within ten (10) Business Days
of
such Ratings Event:
(1) assign
the Transaction to a third party, the ratings of the debt of which (or of the
guarantor of which) meet or exceed the Qualifying Ratings, on terms
substantially similar to this Confirmation, which party is approved by the
Counterparty, such approval not to be unreasonably withheld,
(2) obtain
a guaranty of, or a contingent agreement of, another person, the ratings of
the
debt of which (or of the guarantor of which) meet or exceed the Qualifying
Ratings, to honor BNY’s obligations under this Agreement, provided
that
such
other person is approved by the Counterparty, such approval not to be
unreasonably withheld, or
(3) establish
any other arrangement approved by the Counterparty, such approval not to be
unreasonably withheld, which will be sufficient to restore the immediately
prior
ratings of the Certificates.
|
10)
|
Compliance
with Regulation AB.
|
|
(a)
|
It
shall be a swap disclosure event (“Swap
Disclosure Event”)
if, at any time after the date hereof, the Trustee (acting on behalf
of
the Depositor or the Sponsor) notifies BNY that the aggregate
“significance percentage” (calculated in accordance with the provisions of
Item 1115 of Regulation AB) of all derivative instruments provided
by BNY
and any of its affiliates to Counterparty (collectively, the “Aggregate
Significance Percentage”)
is 10% or more.
|
|
(b)
|
Upon
the occurrence of a Swap Disclosure Event, BNY, at its own cost and
expense (and without any expense or liability to the Depositor, the
Sponsor, the Underwriters, the Depositor, the Trustee or the Issuing
Entity), shall take one of the following actions: (i) provide to
the
Sponsor and the Depositor: (x) if the Aggregate Significance Percentage
is
10% or more, but less than 20%, the information required under Item
1115(b)(1) of Regulation AB or (y) if the Aggregate Significance
Percentage is 20% or more, within five (5) Business Days, the information
required under Item 1115(b)(2) of Regulation AB; or (ii) assign its
rights
and delegate its obligations under the Transaction to a counterparty
with
the Approved Ratings Thresholds (or which satisfies the Rating Agency
Condition), that (x) provides the information specified in clause
(i)
above to the Depositor and Sponsor and (y) enters into documentation
substantially similar to the documentation then in place between
BNY and
the Counterparty.
|
|
(c)
|
For
so long as the Aggregate Significance Percentage is 10% or more,
BNY shall
provide any updates to the information provided pursuant to clause
(b)
above to the Sponsor and the Depositor within five (5) Business Days
following availability thereof (but in no event more than 45 days
after
the end of each of BNY’s fiscal quarter for any quarterly update, and in
no even more than 90 days after the end of each of BNY’s fiscal year for
any annual update).
|
|
(d)
|
All
information provided pursuant to clauses (b) and (c) shall be in
a form
suitable for conversion to the format required for filing by the
Depositor
with the Commission via the Electronic Data Gathering and Retrieval
System
(▇▇▇▇▇). In addition, any such information, if audited, shall be
accompanied by any necessary auditor’s consents or, if such information is
unaudited, shall be accompanied by an appropriate agreed-upon procedures
letter from BNY’s accountants. If permitted by Regulation AB, any such
information may be provided by reference to or incorporation by reference
from reports filed pursuant to the Exchange
Act.
|
|
11)
|
Additional
Provisions.
Notwithstanding the terms of Sections 5 and 6 of the ISDA Form Master
Agreement, if the Counterparty has satisfied its payment obligations
under
Section 2(a)(i) of the ISDA Form Master Agreement, and shall, at
the time,
have no future payment or delivery obligation, whether absolute or
contingent, then unless BNY is required pursuant to appropriate
proceedings to return to the Counterparty or otherwise returns to
the
Counterparty upon demand of the Counterparty any portion of such
payment,
(a) the occurrence of an event described in Section 5(a) of the ISDA
Form
Master Agreement with respect to the Counterparty shall not constitute
an
Event of Default or Potential Event of Default with respect to the
Counterparty as the Defaulting Party and (b) BNY shall be entitled
to
designate an Early Termination Date pursuant to Section 6 of the
ISDA Form
Master Agreement only as a result of a Termination Event set forth
in
either Section 5(b)(i) or Section 5(b)(ii) of the ISDA Form Master
Agreement with respect to BNY as the Affected Party or Section 5(b)(iii)
of the ISDA Form Master Agreement with respect to BNY as the Burdened
Party.
|
|
12)
|
BNY Payments
to be made to the
Administrator.
BNY will, unless otherwise directed by the Trustee,
make all payments hereunder to Deutsche
Bank National Trust Company in
its capacity as Administrator.
Payment made to Deutsche
Bank National Trust Company
at
the account specified herein or to another account specified in writing
by
Deutsche
Bank National Trust Company
shall satisfy the payment obligations of BNY hereunder to the extent
of
such payment.
|
|
5.
|
Account
Details and Settlement
Information:
|
Payments
to BNY:
The
Bank
of New York
Derivative
Products Support Department
▇▇
▇▇▇
▇▇▇▇, ▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
▇▇▇▇▇ ▇▇▇▇▇▇▇
ABA
#▇▇▇▇▇▇▇▇▇
Account
#▇▇▇-▇▇▇▇-▇▇▇
Reference:
Interest Rate Swap
Payments
to Counterparty:
Deutsche
Bank Trust Company - Americas
ABA:
▇▇▇▇▇▇▇▇▇
Bene
Acct: ▇▇▇-▇▇-▇▇▇
Bene
Acct Name: NYLTD Funds Control - Stars West
Attn:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ HVMLT 2006-SB1
6.
Counterparts.
This
Agreement may be executed in several counterparts, each of which shall be deemed
an original but all of which together shall constitute one and the same
instrument.
Please
confirm that the foregoing correctly sets forth the terms of our agreement
by
executing this agreement and returning it via facsimile to Derivative Products
Support Dept., Attn: ▇▇▇▇▇ Au-▇▇▇▇▇ at ▇▇▇-▇▇▇-▇▇▇▇/5837. Once we receive this
we will send you two original confirmations for execution.
Page 18 of 21
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
THE
BANK OF NEW YORK
By:
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
The
Counterparty, acting through its duly authorized signatory, hereby agrees to,
accepts and confirms the terms of the foregoing as of the Trade
Date.
HARBORVIEW
MORTGAGE LOAN TRUST 2006-SB1
BY:
DEUTSCHE BANK NATIONAL TRUST COMPANY, NOT INDIVIDUALLY, BUT SOLELY AS
ADMINISTRATOR ON BEHALF OF HARBORVIEW
2006-SB1 YIELD MAINTENANCE TRUST
By:
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Authorized Signer
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Authorized Signer
SCHEDULE
I
All
dates
subject to adjustment in accordance with the Following Business Day
Convention.
|
Accrual
Start Date
|
Accrual
End Date
|
Notional
Amount (in USD)
|
Cap
Rate (%)
|
|
11/19/08
|
12/19/08
|
202,750,403.27
|
8.935210
|
|
12/19/08
|
01/19/09
|
195,829,612.99
|
8.841110
|
|
01/19/09
|
02/19/09
|
189,144,409.45
|
8.745640
|
|
02/19/09
|
03/19/09
|
182,686,789.64
|
8.648810
|
|
03/19/09
|
04/19/09
|
176,449,022.01
|
8.550330
|
|
04/19/09
|
05/19/09
|
170,423,637.26
|
8.450410
|
|
05/19/09
|
06/19/09
|
164,603,419.46
|
8.349630
|
|
06/19/09
|
07/19/09
|
158,981,397.44
|
8.247180
|
|
07/19/09
|
08/19/09
|
153,550,836.57
|
8.142700
|
|
08/19/09
|
09/19/09
|
148,305,230.62
|
8.036330
|
|
09/19/09
|
10/19/09
|
143,238,294.18
|
7.927810
|
|
10/19/09
|
11/19/09
|
138,343,955.01
|
7.610610
|
|
11/19/09
|
12/19/09
|
133,616,346.95
|
7.567410
|
|
12/19/09
|
01/19/10
|
129,049,802.88
|
7.521900
|
|
01/19/10
|
02/19/10
|
124,638,847.97
|
7.473790
|
|
02/19/10
|
03/19/10
|
120,378,193.17
|
7.422910
|
|
03/19/10
|
04/19/10
|
116,262,728.93
|
7.369080
|
|
04/19/10
|
05/19/10
|
112,287,519.09
|
7.312260
|
|
05/19/10
|
06/19/10
|
108,447,795.04
|
7.272620
|
|
06/19/10
|
07/19/10
|
104,738,949.97
|
7.377700
|
|
07/19/10
|
08/19/10
|
101,156,533.49
|
7.318720
|
|
08/19/10
|
09/19/10
|
97,696,246.24
|
7.256200
|
|
09/19/10
|
10/19/10
|
94,353,934.79
|
7.189700
|
|
10/19/10
|
11/19/10
|
91,125,586.75
|
7.120290
|
|
11/19/10
|
12/19/10
|
88,007,325.91
|
7.047840
|
|
12/19/10
|
01/19/11
|
84,995,407.63
|
6.972230
|
|
01/19/11
|
02/19/11
|
82,086,214.48
|
6.893310
|
|
02/19/11
|
03/19/11
|
79,276,251.79
|
6.810930
|
|
03/19/11
|
04/19/11
|
76,562,143.57
|
6.724960
|
|
04/19/11
|
05/19/11
|
73,940,628.48
|
6.695010
|
Page 21 of 21
|
05/19/11
|
06/19/11
|
71,408,555.91
|
6.678310
|
|
06/19/11
|
07/19/11
|
68,962,882.25
|
6.660890
|
|
07/19/11
|
08/19/11
|
66,600,667.27
|
6.642700
|
|
08/19/11
|
09/19/11
|
48,811,476.59
|
6.021329
|
|
09/19/11
|
10/19/11
|
45,460,195.89
|
6.146389
|
|
10/19/11
|
11/19/11
|
43,720,871.75
|
6.277258
|
|
11/19/11
|
12/19/11
|
42,051,169.19
|
6.407300
|
|
12/19/11
|
01/19/12
|
40,448,326.14
|
6.544909
|
|
01/19/12
|
02/19/12
|
38,909,679.09
|
6.669807
|
|
02/19/12
|
03/19/12
|
37,432,664.72
|
6.801413
|
|
03/19/12
|
04/19/12
|
34,598,013.21
|
6.908352
|
|
04/19/12
|
05/19/12
|
33,290,427.74
|
7.018172
|
|
05/19/12
|
06/19/12
|
32,035,117.18
|
7.152600
|
|
06/19/12
|
07/19/12
|
30,823,502.59
|
7.270001
|
|
07/19/12
|
08/19/12
|
29,649,645.25
|
7.378183
|