Exhibit 10.2
Barclays Bank PLC
5 The North Colonnade
Canary Wharf
London E14 4BB
Tel +44 (0)20 7623 2323
DATE:
March 30, 2007
TO:
Wells Fargo Bank, National Association, not individually,
but solely as Securities Administrator for Wells Fargo
Home Equity Asset-Backed Securities 2007-1 Trust, Home
Equity Asset-Backed Certificates, Series 2007-1
ATTENTION:
Client Manager - WFHET 2007-1
TELEPHONE:
410-884-2000
FACSIMILE:
410-715-2380
FROM:
Barclays Bank PLC
SUBJECT:
Fixed Income Derivatives Confirmation
REFERENCE NUMBER: 1680781B
The purpose of this long-form confirmation ("Confirmation") is to
confirm the
terms and conditions of the Transaction entered into on the Trade
Date specified
below (the "Transaction") between Barclays Bank PLC ("Party A") and
Wells Fargo
Bank, National Association, not individually, but solely as
securities
administrator (the "Securities Administrator") on behalf of the
supplemental
interest trust with respect to the Wells Fargo Home Equity
Asset-Backed
Securities 2007-1 Trust (the "Trust") ("Party B") created under the
Pooling and
Servicing Agreement, dated as of March 30, 2007, among Wells Fargo
Asset
Securities Corporation, as Depositor, HSBC Bank USA, National
Association, as
Trustee, and Wells Fargo Bank, National Association, in its
capacity as Servicer
and as Securities Administrator (the "Base Agreement"). This
Confirmation
evidences a complete and binding agreement between you and us to
enter into the
Transaction on the terms set forth below and replaces any previous
agreement
between us with respect to the subject matter hereof. This
Confirmation
constitutes a "Confirmation" and also constitutes a "Schedule" as
referred to in
the ISDA Master Agreement, and Paragraph 13 of a Credit Support
Annex to the
Schedule.
1. This
Confirmation shall supplement, form a part of, and be subject to
an
agreement
in the form of the ISDA Master Agreement (Multicurrency - Cross
Border) as
published and copyrighted in 1992 by the International Swaps
and
Derivatives Association, Inc. (the "ISDA Master Agreement"), as
if
Party A
and Party B had executed an agreement in such form on the date
hereof,
with a Schedule as set forth in Item 3 of this Confirmation,
and
an ISDA
Credit Support Annex (Bilateral Form - ISDA Agreements Subject
to
New York
Law Only version) as published and copyrighted in 1994 by the
International Swaps and Derivatives Association, Inc., with
Paragraph 13
thereof as
set forth in Annex A hereto (the "Credit Support Annex"). For
the
avoidance of doubt, the Transaction described herein shall be the
sole
Transaction governed by such ISDA Master Agreement. In the event of
any
inconsistency among any of the following documents, the relevant
document
first
listed shall govern: (i) this Confirmation, exclusive of the
provisions
set forth in Item 3 hereof and Annex A hereto; (ii) the
provisions
set forth in Item 3 hereof, which are incorporated by reference
into the
Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v)
the ISDA Master Agreement.
Each
reference herein to a "Section" (unless specifically referencing
the
Base
Agreement) or to a "Section of this Agreement" will be construed as
a
reference
to a Section of the ISDA Master Agreement; each reference
herein
to a
"Part" will be construed as a reference to the provisions
herein
deemed
incorporated in a Schedule to the ISDA Master Agreement; each
reference
herein to a "Paragraph" will be construed as a reference to a
Paragraph
of the Credit Support Annex.
2. The
terms of the particular Transaction to which this Confirmation
relates
are as
follows:
Notional
Amount:
With respect to any Calculation Period,
the amount set forth for such period on
Schedule I attached hereto.
Trade
Date:
March 30, 2007
Effective
Date:
March 30, 2007
Termination Date:
December 25, 2011, which for the purpose
of the final Fixed Rate Payer Calculation
Period is subject to No Adjustment, and
for the purpose of the final Floating Rate
Payer Calculation Period is subject to
adjustment in accordance with the Business
Day Convention.
Fixed
Amounts:
Fixed Rate Payer:
Party B
Fixed Rate Payer
Period End Dates:
The 25th calendar day of each month during
the Term
of this Transaction, commencing
April 25, 2007, subject to No Adjustment.
Fixed Rate Payer
Payment Dates:
Early Payment shall be applicable. For
each Calculation Period, the Fixed Rate
Payer Payment Date shall be the first
Business Day prior to the related Fixed
Rate Payer Period End Date.
Fixed Rate:
With respect to any Calculation Period,
the fixed rate set forth for such period
on Schedule I attached hereto.
Fixed Rate Day
Count Fraction:
30/360
Floating
Amounts:
Floating Rate Payer: Party A
Floating Rate Payer
Period End Dates:
The 25th calendar day of
each month during the Term of this
Transaction, commencing April 25,
2007, subject to adjustment in accordance
with the Business Day Convention.
Floating Rate Payer
Payment Dates:
Early Payment shall be applicable. For
each Calculation Period, the Floating Rate
Payer Payment Date shall be the first
Business Day prior to the related Floating
Rate Payer Period End Date.
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: One month
Floating Rate Day
Count Fraction:
Actual/360
Reset Dates:
The first day of each Calculation Period.
Compounding:
Inapplicable
Business Days:
New York
Business Day Convention: Modified Following
Calculation Agent:
Party A
Account Details and Settlement Information:
Payments to Party A: Correspondent: BARCLAYS BANK
PLC NEW YORK
FEED: 026002574
Beneficiary: BARCLAYS SWAPS
Beneficiary Account: 050-01922-8
Payments to Party B: Wells Fargo Bank, National
Association
ABA #: 121000248
Acct #: 3970771416
Acct. Name: SAS Clearing
Ref: For Further Credit 50999801,
WFHET 2007-1 Supplemental Interest
Trust Account
<PAGE>
3.
Provisions Deemed Incorporated in a Schedule to the ISDA Master
Agreement:
Part 1. Termination Provisions.
For the purposes of this Agreement:-
(a)
"Specified Entity" will not apply to Party A or Party B for any
purpose.
(b)
"Specified Transaction" will not apply to Party A or Party B for
any
purpose.
(c) Events
of Default.
The
statement below that an Event of Default will apply to a
specific
party means that upon the occurrence of such an Event of Default
with
respect to such party, the other party shall have the rights of
a
Non-defaulting Party under Section 6 of this Agreement; conversely,
the
statement below that such event will not apply to a specific party
means
that
the other party shall not have such rights.
(i)
The
"Failure to Pay or Deliver" provisions of Section 5(a)(i) will
apply to Party A and will apply to Party B.
(ii)
The "Breach of
Agreement" provisions of Section 5(a)(ii) will
apply to Party A and will not apply to Party B; provided,
however,
that notwithstanding anything to the contrary in Section
5(a)(ii),
any failure by Party A to comply with or perform any obligation
to
be complied with or performed by Party A under the Credit
Support
Annex shall not constitute an Event of Default under Section
5(a)(ii) unless (A) a Required Ratings Downgrade Event has
occurred and been continuing for 30 or more Local Business Days
and (B) such failure is not remedied on or before the third
Local
Business Day after notice of such failure is given to Party A.
(iii) The "Credit
Support Default" provisions of Section 5(a)(iii) will
apply to Party A and will not apply to Party B except that
Section
5(a)(iii)(1) will apply to Party B solely in respect of Party
B's
obligations under Paragraph 3(b) of the Credit Support Annex;
provided, however, that notwithstanding anything to the
contrary
in Section 5(a)(iii)(1), any failure by Party A to comply with
or
perform any obligation to be complied with or performed by Party
A
under the Credit Support Annex shall not constitute an Event of
Default under Section 5(a)(iii) unless (A) a Required Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local Business Days and (B) such failure is not remedied on or
before the third Local Business Day after notice of such
failure
is given to Party A.
(iv)
The
"Misrepresentation" provisions of Section 5(a)(iv) will apply
to Party A and will not apply to Party B.
(v)
The
"Default under Specified Transaction" provisions of Section
5(a)(v) will not apply to Party A and will not apply to Party
B.
(vi)
The "Cross
Default" provisions of Section 5(a)(vi) will apply to
Party A and will not apply to Party B. For purposes of Section
5(a)(vi),
solely with respect to Party A:
"Specified Indebtedness" will have the meaning specified in
Section 14, except that such term shall not include obligations
in
respect of deposits received in the ordinary course of Party
A's
banking business.
"Threshold Amount" means with respect to Party A an amount
equal
to 3% of Party A's shareholders' equity (on a consolidated
basis)
determined in accordance with generally accepted accounting
principles in Party A's jurisdiction of incorporation or
organization as at the end of Party A's most recently completed
fiscal year.
(vii) The "Bankruptcy"
provisions of Section 5(a)(vii) will apply to
Party A and Party B; provided that clauses (2), (7) and (9)
thereof shall not apply to Party B; provided further that
clause
(4) thereof shall not apply to Party B with respect to
proceedings
or petitions instituted or presented by Party A or any
Affiliate
of Party A; provided further that clause (6) shall not apply to
Party B to the extent that it refers to (i) any appointment
that
is
effected by or contemplated in connection with the Base
Agreement (as defined above) or (ii) any appointment to which
Party B has not become subject; and provided further that
clause
(8) shall not apply to Party B to the extent that clause (8)
relates to clauses of Section 5(a)(vii) that are not applicable
to
Party B.
(viii) The "Merger Without Assumption" provisions of Section
5(a)(viii)
will apply to Party A and will apply to Party B.
(d)
Termination Events.
The
statement below that a Termination Event will apply to a
specific
party means that upon the occurrence of such a Termination Event,
if such
specific party is the Affected Party with respect to a Tax Event,
the
Burdened Party with respect to a Tax Event Upon Merger (except as
noted
below) or the non-Affected Party with respect to a Credit Event
Upon
Merger, as the case may be, such specific party shall have the
right to
designate an Early Termination Date in accordance with Section 6 of
this
Agreement; conversely, the statement below that such an event will
not
apply to a specific party means that such party shall not have
such
right; provided, however, with respect to "Illegality" the
statement that
such
event will apply to a specific party means that upon the
occurrence
of
such a Termination Event with respect to such party, either
party
shall have the right to designate an Early Termination Date in
accordance
with
Section 6 of this Agreement.
(i)
The
"Illegality" provisions of Section 5(b)(i) will apply to Party
A and will apply to Party B.
(ii)
The "Tax Event"
provisions of Section 5(b)(ii) will apply to Party
A and will apply to Party B.
(iii) The "Tax Event
Upon Merger" provisions of Section 5(b)(iii) will
apply to Party A and will apply to Party B, provided that Party
A
shall not be entitled to designate an Early Termination Date by
reason of a Tax Event upon Merger in respect of which it is the
Affected Party.
(iv)
The "Credit
Event Upon Merger" provisions of Section 5(b)(iv) will
not apply to Party A and will not apply to Party B.
(e) The
"Automatic Early Termination" provision of Section 6(a) will
not
apply to Party A and will not apply to Party B.
(f)
Payments on Early Termination. For the purpose of Section 6(e) of
this
Agreement:
(i)
Market
Quotation will apply, provided, however, that, in the event
of a Derivative Provider Trigger Event, the following
provisions
will apply:
(A) The
definition of Market Quotation in Section 14 shall be
deleted in its entirety and replaced with the following:
"Market Quotation" means, with respect to one or more
Terminated Transactions, a Firm Offer which is (1) made by
a Reference Market-maker that is an Eligible Replacement,
(2) for an amount that would be paid to Party B (expressed
as a negative number) or by Party B (expressed as a
positive number) in consideration of an agreement between
Party B and such Reference Market-maker to enter into a
Replacement Transaction, and (3) made on the basis that
Unpaid Amounts in respect of the Terminated Transaction or
group of Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the
relevant Early Termination Date, have been required
(assuming satisfaction of each applicable condition
precedent) after that Early Termination Date is to be
included.
(B) The
definition of Settlement Amount shall be deleted in its
entirety and replaced with the following:
"Settlement Amount" means, with respect to any Early
Termination Date, an amount equal to:
(a)
If a
Market Quotation for the relevant Terminated
Transaction or group of Terminated Transactions is
accepted by Party B so as to become legally binding
on or before the day falling ten Local Business Days
after the day on which the Early Termination Date is
designated, or such later day as Party B may specify
in writing to Party A, but in either case no later
than one Local Business Day prior to the Early
Termination Date (such day, the "Latest Settlement
Amount Determination Day"), the Termination Currency
Equivalent of the amount (whether positive or
negative) of such Market Quotation;
(b) If, on
the Latest Settlement Amount Determination
Day, no Market Quotation for the relevant Terminated
Transaction or group of Terminated Transactions has
been accepted by Party B so as to become legally
binding and one or more Market Quotations from
Approved Replacements have been made and remain
capable of becoming legally binding upon acceptance,
the Settlement Amount shall equal the Termination
Currency Equivalent of the amount (whether positive
or negative) of the lowest of such Market Quotations
(for the avoidance of doubt, the lowest of such
Market Quotations shall be the lowest Market
Quotation of such Market Quotations expressed as a
positive number or, if any of such Market Quotations
is expressed as a negative number, the Market
Quotation expressed as a negative number with the
largest absolute value); or
(c) If, on
the Latest Settlement Amount Determination
Day, no Market Quotation for the relevant Terminated
Transaction or group of Terminated Transactions is
accepted by Party B so as to become legally binding
and no Market Quotation from an Approved Replacement
remains capable of becoming legally binding upon
acceptance, the Settlement Amount shall equal Party
B's Loss (whether positive or negative and without
reference to any Unpaid Amounts) for the relevant
Terminated Transaction or group of Terminated
Transactions.
(C) Party A may obtain Market
Quotations, and if Party B
requests Party A in writing to obtain Market Quotations,
Party A shall use its reasonable efforts to do so before
the Latest Settlement Amount Determination Day.
(D) If the
Settlement Amount is a negative number, Section
6(e)(i)(3) shall be deleted in its entirety and replaced
with the following:
"(3) Second Method and Market Quotation. If the Second
Method and Market Quotation apply, (I) Party B shall pay to
Party A an amount equal to the absolute value of the
Settlement Amount in respect of the Terminated
Transactions, (II) Party B shall pay to Party A the
Termination Currency Equivalent of the Unpaid Amounts owing
to Party A and (III) Party A shall pay to Party B the
Termination
Currency Equivalent of the Unpaid Amounts owing
to Party B; provided, however, that (x) the amounts payable
under the immediately preceding clauses (II) and (III)
shall be subject to netting in accordance with Section 2(c)
of this Agreement and (y) notwithstanding any other
provision of this Agreement, any amount payable by Party A
under the immediately preceding clause (III) shall not be
netted-off against any amount payable by Party B under the
immediately preceding clause (I)."
(E) At any
time on or before the Latest Settlement Amount
Determination Day at which two or more Market Quotations
from Approved Replacements remain capable of becoming
legally binding upon acceptance, Party B shall be entitled
to accept only the lowest of such Market Quotations (for
the avoidance of doubt, the lowest of such Market
Quotations shall be the lowest Market Quotation of such
Market Quotations expressed as a positive number or, if any
of such Market Quotations is expressed as a negative
number, the Market Quotation expressed as a negative number
with the largest absolute value).
(ii)
The Second
Method will apply.
(g)
"Termination Currency" means USD.
(h)
Additional Termination Events. Additional Termination Events will
apply
as
provided in Part 5(c).
<PAGE>
Part 2. Tax Matters.
(a) Tax
Representations.
(i)
Payer
Representations. For the purpose of Section 3(e) of this
Agreement:
(A) Party
A makes the following representation(s):
None.
(B) Party
B makes the following representation(s):
None.
(ii)
Payee
Representations. For the purpose of Section 3(f) of this
Agreement:
(A) Party
A makes the following representation(s):
None.
(B) Party
B makes the following representation(s):
None.
(b) Tax
Provisions.
(i)
Indemnifiable Tax. Notwithstanding the definition of
"Indemnifiable Tax" in Section 14 of this Agreement, all Taxes
in
relation to payments by Party A shall be Indemnifiable Taxes
unless (i) such Taxes are assessed directly against Party B and
not by deduction or withholding by Party A or (ii) arise as a
result of a Change in Tax Law (in which case such Tax shall be
an
Indemnifiable Tax only if such Tax satisfies the definition of
Indemnifiable Tax provided in Section 14). In relation to
payments
by Party B, no Tax shall be an Indemnifiable Tax, unless the
Tax
is due to a Change in Tax Law and otherwise satisfies the
definition of Indemnifiable Tax provided in Section 14.
<PAGE>
Part 3. Agreement to Deliver Documents.
(a) For the purpose of
Section 4(a)(i), tax forms, documents, or certificates
to be delivered are:
<TABLE>
<CAPTION>
Party required to Form/Document/
Date by which to
deliver document Certificate
be delivered
<S>
<C>
<C>
Party A
Any form or document required or
Promptly upon reasonable demand by
reasonably requested to allow Party B Party B.
to make payments under the Agreement
without any deduction or withholding
for or on account of any Tax, or with
such deduction or withholding at a
reduced rate.
Party B
(i) A correct, complete and duly
In each case (a) upon entering into
executed IRS Form W-9 (or any
this Agreement, provided however,
successor thereto) of the Trust that with respect to
(i), Party B shall
eliminates U.S. federal withholding apply for
the employer identification
and backup withholding tax on payments number of the Trust promptly
upon
under this Agreement, (ii) if
entering into this Agreement and
requested by Party A, a correct,
deliver the related correct, complete
complete and executed Form W-8IMY of and duly
executed IRS Form W-9
the Trust, and (iii) a complete and promptly
upon receipt, and in any
executed IRS Form W-9, W-8BEN, W-8ECI, event, no later than the
first
or W-8IMY (with attachments) (as
Payment Date of this Transaction;
appropriate) from each
(b) in the case of a W-8ECI, W-8IMY,
Certificateholder that is not an
and W-8BEN that does not include a
"exempt recipient" as that term is U.S.
taxpayer identification number
defined in Treasury regulations
in line 6, before December 31 of each
section 1.6049-4(c)(1)(ii), that
third succeeding calendar year, (c)
eliminates U.S. federal withholding promptly
upon reasonable demand by
and backup withholding tax on payments Party A, and (d) promptly
upon
under this Agreement.
learning that any such Form
previously provided by Party B has
become obsolete or incorrect.
</TABLE>
(b) For
the purpose of Section 4(a)(ii), other documents to be delivered
are:
<TABLE>
<CAPTION>
Covered by
Party required to Form/Document/
Date by which to
Section 3(d)
deliver document Certificate
be delivered
Representation
<S>
<C>
<C>
<C>
Party A and
A certificate of an authorized Upon the execution and
Yes
Party B
officer of the party (except, delivery of this
Agreement
with respect to Party B, of
the Securities Administrator),
as to the incumbency and
authority of the respective
officers of the party signing
the Agreement, this
Confirmation, and any relevant
Credit Support Document, as
the case may be
Party A
An opinion of counsel to Party Upon the execution and
No
A reasonably satisfactory to delivery of this
Agreement
Party B.
Party B
An opinion of counsel to Party Upon the execution and
No
B
reasonably satisfactory to delivery of this
Agreement
Party A.
Party B
An executed copy of the Base Within 30 days
after the date No
Agreement
of this Agreement.
</TABLE>
Part 4. Miscellaneous.
(a)
Address for Notices: For the purposes of Section 12(a) of this
Agreement:
Address for notices or communications to Party A:
Address: 5 The
North Colonnade
Canary Wharf
London E14 4BB
Facsimile:
44(20) 777 36461
Phone:
44(20) 777 36810
(For
all purposes)
Address for notices or communications to Party B:
Address: Wells
Fargo Bank, National Association
9062 Old Annapolis Road
Columbia, Maryland 21045
Attention:
Client Manager - WFHET 2007-1
Facsimile:
(410) 715-2380
Phone:
(410) 884-2000
(For
all purposes)
(b)
Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not applicable.
Party B appoints as its Process Agent: Not applicable.
(c)
Offices. 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 not a Multibranch Party.
Party B is not a Multibranch Party.
(e)
Calculation Agent. The Calculation Agent is Party A.
(f) Credit
Support Document.
Party A: The Credit
Support Annex, and any guarantee in support
of Party A's obligations under this Agreement.
Party B: The Credit
Support Annex, solely in respect of Party
B's obligations under Paragraph 3(b) of the Credit Support
Annex.
(g) Credit
Support Provider.
Party A: The
guarantor under any guarantee in support of Party
A's obligations under this Agreement.
Party B: None.
(h)
Governing Law. The parties to this Agreement hereby agree that the
law of
the
State of New York shall govern their rights and duties in whole
(including any claim or controversy arising out of or relating to
this
Agreement), without regard to the conflict of law provisions
thereof
other than New York General Obligations Law Sections 5-1401 and
5-1402.
(i)
Netting of Payments. The parties agree that subparagraph (ii) of
Section
2(c)
will apply to each Transaction hereunder.
(j)
Affiliate. "Affiliate" shall have the meaning assigned thereto in
Section
14;
provided, however, that Party B shall be deemed to have no
Affiliates
for
purposes of this Agreement, including for purposes of Section
6(b)(ii).
<PAGE>
Part 5. Others Provisions.
(a)
Definitions. Unless otherwise specified in a Confirmation, this
Agreement
and
each Transaction under this Agreement are subject to the 2000
ISDA
Definitions as published and copyrighted in 2000 by the
International
Swaps and Derivatives Association, Inc. (the "Definitions"), and
will be
governed in all relevant respects by the provisions set forth in
the
Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part of
this
Agreement, except that (i) references in the Definitions to a
"Swap
Transaction" shall be deemed references to a "Transaction" for
purposes
of
this Agreement, and (ii) references to a "Transaction" in this
Agreement shall be deemed references to a "Swap Transaction" for
purposes
of
the Definitions. Each term capitalized but not defined in this
Agreement shall have the meaning assigned thereto in the Base
Agreement.
(b)
Amendments to ISDA Master Agreement.
(i)
Single
Agreement. Section 1(c) is hereby amended by the adding the
words "including, for the avoidance of doubt, the Credit
Support
Annex" after the words "Master Agreement".
(ii)
Change of
Account. Section 2(b) is hereby amended by the addition
of the following after the word "delivery" in the first line
thereof:
"to another account in the same legal and tax jurisdiction as
the
original account".
(iv)
Representations.
Section 3 is hereby amended by adding at the end
thereof the following subsection (g):
"(g) Relationship Between Parties.
(1)
Non-Reliance. Party A has made its own independent
decisions to enter into this Transaction and as to
whether this Transaction is appropriate or proper
for it based upon its own judgment and upon advice
from such advisors as it has deemed necessary. The
Securities Administrator is acting, not individually
or personally, but as Securities Administrator on
behalf of the Trust and has been directed pursuant
to the Base Agreement to enter into this Agreement
on behalf of the Trust, which has made its own
independent decisions to enter into this Transaction
and as to whether this Transaction is appropriate or
proper for it based upon its own judgment and upon
advice from such advisors as it has deemed
necessary. Each party is not relying on any
communication (written or oral) of the other party
as investment advice or as a recommendation to enter
into this Transaction; it being understood that
information and explanations related to the terms
and conditions of this Transaction shall not be
considered investment advice or a recommendation to
enter into this Transaction. Further, such party has
not received from the other party any assurance or
guarantee as to the expected results of this
Transaction.
(2)
Assessment and Understanding. It is capable of
assessing the merits of and understanding (on its
own behalf or through independent professional
advice), and understands and accepts, the terms,
conditions and risks of that Transaction. It is also
capable of assuming, and assumes, the risks of that
Transaction.
(3)
Purpose. It is entering into the Transaction for the
purposes of managing its borrowings or investments,
hedging its underlying assets or liabilities or in
connection with a line of business.
(4) Status
of Parties. The other party is not acting as
fiduciary for or advisor to it in respect of the
Transaction.
(5)
Eligible Contract Participant. It is an "eligible
contract participant" as defined in Section 1(a)(12)
of the Commodity Exchange Act, as amended."
(v)
Transfer
to Avoid Termination Event. Section 6(b)(ii) is hereby
amended by
deleting the words "or if a Tax Event Upon Merger
occurs and the Burdened Party is the Affected Party."
(vi)
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.
(c)
Additional Termination Events. The following Additional
Termination
Events will apply:
(i)
First
Rating Trigger Collateral. If (A) it is not the case that a
Moody's Second Trigger Ratings Event has occurred and been
continuing for 30 or more Local Business Days and (B) Party A
has
failed to comply with or perform any obligation to be complied
with
or performed by Party A in accordance with the Credit Support
Annex, then an Additional Termination Event shall have occurred
with respect to Party A and Party A shall be the sole Affected
Party with respect to such Additional Termination Event.
(ii)
Second Rating
Trigger Replacement. If (A) a Required Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local Business Days and (B) (i) at least one Eligible
Replacement
has made a Firm Offer to be the transferee of all of Party A's
rights and obligations under this Agreement (and such Firm
Offer
remains an offer that will become legally binding upon such
Eligible Replacement upon acceptance by the offeree) and/or
(ii)
an Eligible Guarantor has made a Firm Offer to provide an
Eligible
Guarantee (and such Firm Offer remains an offer that will
become
legally binding upon such Eligible Guarantor immediately upon
acceptance by the offeree), then an Additional Termination
Event
shall have occurred with respect to Party A and Party A shall
be
the sole Affected Party with respect to such Additional
Termination Event.
(iii) Amendment of
Base Agreement. If, without the prior written consent
of Party A where such consent is required under the Base
Agreement, an amendment is made to the Base Agreement
(excluding,
for the avoidance of doubt, any amendment to the Base Agreement
that is entered into solely for the purpose of appointing a
successor servicer, master servicer, securities administrator,
trustee or other service provider) under this Agreement, an
Additional Termination Event shall have occurred with respect
to
Party B and Party B shall be the sole Affected Party with
respect
to such Additional Termination Event.
(iv)
Termination of
Trust/ Securitization Unwind. If the Trust is
terminated pursuant to the Base Agreement and all rated
certificates have been paid in accordance with the terms of the
Base Agreement or if a Securitization Unwind (as hereinafter
defined) occurs, an Additional Termination Event shall have
occurred with respect to Party B and Party B shall be the sole
Affected Party with respect to such Additional Termination
Event.
As used herein, "Securitization Unwind" means notice of the
requisite amount of a party's intention to exercise its option
to
purchase the underlying mortgage loans pursuant the Base
Agreement
is given by the Trustee or the Securities Administrator to
certificateholders or noteholders, as applicable, pursuant to
the
Base Agreement.
(v)
Regulation
AB.
(A) If (1) the Depositor still has a reporting obligation with
respect to this Transaction pursuant to Regulation AB (as
defined
below) and (2) Party A has not, within 30 days after receipt of
a
10% Disclosure Request (as defined below) complied with the
provisions set forth in clauses (ii) and (iii) of Part 5(q)
below
(provided that if the significance percentage is 10% or more
and
less than 20% when the 10% Disclosure Request is made or
reaches
10% after a 10% Disclosure Request has been made to Party A,
Party
A must comply with the provisions set forth in clauses (ii) and
(iii) of Part 5(q) below within 3 calendar days of Party A
being
informed of the significance percentage reaching 10% or more),
then an Additional Termination Event shall have occurred with
respect to Party A and Party A shall be the sole Affected Party
with respect to such
Additional Termination Event.
(B) If (1) the Depositor still has a reporting obligation with
respect to this Transaction pursuant to Regulation AB and (2)
Party A has not, within 30 days after receipt of a 20%
Disclosure
Request (as defined below) complied with the provisions set
forth
in clauses (iv) and (v) of Part 5(q) below (provided that if
the
significance percentage is 20% or more when the 20% Disclosure
Request is made or reaches 20% after a 20% Disclosure Request
has
been made to Party A, Party A must comply with the provisions
set
forth in clauses (iv) and (v) of Part 5(q) below within 3
calendar
days of Party A being informed of the significance percentage
reaching 20% or more), then an Additional Termination Event
shall
have occurred with respect to Party A and Party A shall be the
sole Affected Party with respect to such Additional Termination
Event.
(d)
Required Ratings Downgrade Event. In the event that no Relevant
Entity
has
credit ratings at least equal to the Required Ratings Threshold
of
each
relevant Swap Rating Agency (such event, a "Required Ratings
Downgrade Event"), then Party A shall, as soon as reasonably
practicable
and
so long as a Required Ratings Downgrade Event is in effect, at
its
own
expense, use commercially reasonable efforts to procure either (A)
a
Permitted Transfer or (B) an Eligible Guarantee from an
Eligible
Guarantor.
(e)
Transfers.
(i)
Section 7
is hereby amended to read in its entirety as follows:
"Subject to 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 the Agreement or any Transaction
without (a) the prior written consent of the other party and
(b)
satisfaction of the Rating Agency Condition, except that:
(a) a
party may make such a transfer of this Agreement pursuant
to a
consolidation or amalgamation with, or merger with or
into, or transfer of all or substantially all its assets
to, another entity (but without prejudice to any other
right or remedy under this Agreement);
(b) a
party may make such a transfer of all or any part of its
interest in any amount payable to it from a Defaulting
Party under Section 6(e); and
(c) Party
A may transfer or assign this Agreement to any
Person, including, without limitation, another of Party A's
offices, branches or affiliates (any such Person, office,
branch or affiliate, a "Transferee") on at least five
Business Days' prior written notice to Party B and the
Securities Administrator; provided that, with respect to
this clause (c), (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; (D) Party A will be responsible for any
costs or expenses incurred in connection with such transfer
and (E) Party A obtains in respect of such transfer a
written acknowledgement of satisfaction of the Rating
Agency Condition (except for Moody's). Party B will execute
such documentation as is reasonably deemed necessary by
Party A for the effectuation of any such transfer."
(ii)
If an Eligible
Replacement has made a Firm Offer (which remains an
offer that will become legally binding upon acceptance by Party
B)
to be the transferee pursuant to a Permitted Transfer, Party B
shall, at Party A's written request and at Party A's expense,
take
any reasonable steps required to be taken by Party B to effect
such transfer.
(iii) Upon any
transfer of this Agreement, each of the transferee and
the transferor must be a "dealer in notional principal
contracts"
for purposes of Treasury regulations section 1.1001-4(a). For
the
avoidance of doubt, the Securities Administrator on behalf of
Party B is not obligated to determine whether each of the
transferee and the transferor are such "dealers in notional
principal contracts."
(f)
Non-Recourse. Party A acknowledges and agree that, notwithstanding
any
provision in this Agreement to the contrary, the obligations of
Party B
hereunder are limited recourse obligations of Party B, payable
solely
from
the Trust and the proceeds thereof, in accordance with the
priority
of
payments and other terms of the Base Agreement and that Party A
will
not
have any recourse to any of the directors, officers, employees,
shareholders or affiliates of Party B with respect to any claims,
losses,
damages, liabilities, indemnities or other obligations in
connection with
any
transactions contemplated hereby. In the event that the Trust and
the
proceeds thereof, should be insufficient to satisfy all claims
outstanding and following the realization of the account held by
the
Trust and the proceeds thereof, any claims against or obligations
of
Party B under the ISDA Master Agreement or any other
confirmation
thereunder still outstanding shall be extinguished and thereafter
not
revive. The Securities Administrator shall not have liability for
any
failure or delay in making a payment hereunder to Party A due to
any
failure or delay in receiving amounts in the account held by the
Trust
from
the Trust created pursuant to the Base Agreement. This
provision
will
survive the termination of this Agreement.
(g) Rating
Agency Notifications. Notwithstanding any other provision of
this
Agreement, no Early Termination Date shall be effectively
designated
hereunder by Party B and no transfer of any rights or obligations
under
this
Agreement shall be made by either party unless each Swap Rating
Agency has been given prior written notice of such designation
or
transfer.
(h) No
Set-off. Except as expressly provided for in Section 2(c), Section
6
or
Part 1(f)(i)(D) hereof, and notwithstanding any other provision
of
this
Agreement or any other existing or future agreement, 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.
Section 6(e) shall be amended by deleting the following sentence:
"The
amount, if any, payable in respect of an Early Termination Date
and
determined pursuant to this Section will be subject to any
Set-off.".
(i)
Amendment. Notwithstanding any provision to the contrary in
this
Agreement, no amendment of either this Agreement or any Transaction
under
this
Agreement shall be permitted by either party unless each of the
Swap
Rating Agencies has been provided prior written notice of the same
and
each relevant Swap
Rating Agency (other than Moody's) confirms in writing
(including by facsimile transmission) that it will not
downgrade,
withdraw or otherwise modify its then-current ratings of the
Certificates.
(j) 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
