EX-99.3 4 efc6-1764_exh993.txt EXHIBIT 99.3 EXHIBIT 99.3 BEAR STEARNS BEAR STEARNS FINANCIAL PRODUCTS INC. 383 MADISON AVENUE NEW YORK, NEW YORK 10179 212-272-4009 DATE: May 26, 2006 TO: Citibank, N.A., New York Branch ATTENTION: Phil Sears TELEPHONE: 212-723-1145 FACSIMILE: 212-723-8604 FROM: Derivatives Documentation TELEPHONE: 212-272-2711 FACSIMILE: 212-272-9857 SUBJECT: Fixed Income Derivatives Confirmation and Agreement REFERENCE NUMBER: FXNEC8279 - Amended This Confirmation and Agreement is amended and supersedes all previous ---------------------------------------------------------------------- Confirmations and Agreements regarding this Transaction. -------------------------------------------------------- The purpose of this letter agreement ("Agreement") is to confirm the terms and conditions of the Transaction entered into on the Trade Date specified below (the "Transaction") between Bear Stearns Financial Products Inc. ("BSFP") and Citibank, N.A., New York Branch ("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. 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") but, rather, an ISDA Form Master Agreement shall be deemed to have been executed by you and us on the date we entered into the Transaction. All provisions contained in, or incorporated by reference to, the ISDA Form Master Agreement shall govern the Transaction referenced in this Confirmation, except as expressly modified below. 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. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Type of Transaction: Rate Cap Notional Amount: With respect to any Calculation Period, the amount set forth for such period in Schedule I attached hereto Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 2 of 12 Trade Date: May 19, 2006 Effective Date: May 30, 2006 Termination Date: July 25, 2011 Fixed Amount (Premium): Fixed Rate Payer: Counterparty Fixed Rate Payer Payment Date: May 30, 2006 Fixed Amount: USD ^654,500 -------- Floating Amounts: Floating Rate Payer: BSFP Cap Rate: 5.60000% Floating Rate Payer Period End Dates: The 25th calendar day of each month during the Term of this Transaction, commencing June 25, 2006 and ending on the Termination Date, with No Adjustment. Floating Rate Payer Payment Dates: Early Payment shall be applicable. The Floating Rate Payer Payment Dates shall be two Business Days preceding each Floating Rate Payer Period End Date. Floating Rate Option: USD-LIBOR-BBA, provided, however, that if the Floating Rate determined from such Floating Rate Option for any Calculation Period is greater than 9.10000% then the Floating Rate for such Calculation Period shall be deemed to be 9.10000%. Designated Maturity: One month Floating Rate Day Count Fraction: 30/360 Reset Dates: The first day of each Calculation Period. Compounding: Inapplicable Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 3 of 12 Business Days: New York Business Day Convention: Following 3. Additional Provisions: 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 and in the Confirmation relating to such Transaction, as applicable. This paragraph shall be deemed repeated on the trade date of each Transaction. 4. Provisions Deemed Incorporated in a Schedule to the ISDA Form Master Agreement: 1) The parties agree that subparagraph (ii) of Section 2(c) of the ISDA Form Master Agreement will apply to any Transaction. 2) Termination Provisions. For purposes of the ISDA Form Master Agreement: (a) "Specified Entity" is not applicable to BSFP or Counterparty for any purpose. (b) "Specified Transaction" is not applicable to BSFP or Counterparty for any purpose, and, accordingly, Section 5(a)(v) shall not apply to BSFP or Counterparty. (c) The "Cross Default" provisions of Section 5(a)(vi) will not apply to BSFP or to Counterparty. (d) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not apply to BSFP or Counterparty. (e) The "Automatic Early Termination" provision of Section 6(a) will not apply to BSFP or to Counterparty. (f) Payments on Early Termination. For the purpose of Section 6(e) of the ISDA Form Master Agreement: (i) Market Quotation will apply. (ii) The Second Method will apply. (g) "Termination Currency" means United States Dollars. Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 4 of 12 3) Tax Representations. Not applicable 4) Limitation on Events of Default. Notwithstanding the terms of Sections 5 and 6 of the ISDA Form Master Agreement, if at any time and so long as the Counterparty has satisfied in full all its payment obligations under Section 2(a)(i) of the ISDA Form Master Agreement and has at the time no future payment obligations, whether absolute or contingent, under such Section, then unless BSFP 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 any 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 Defaulting Party and (b) BSFP shall be entitled to designate an Early Termination Date pursuant to Section 6 of the ISDA Form Master Agreement only as a result of the occurrence of a Termination Event set forth in either Section 5(b)(i) or 5(b)(ii) of the ISDA Form Master Agreement with respect to BSFP as the Affected Party, or Section 5(b)(iii) of the ISDA Form Master Agreement with respect to BSFP as the Burdened Party. 5) Documents to be Delivered. For the purpose of Section 4(a) of the ISDA Form Master Agreement: (1) Tax forms, documents, or certificates to be delivered are:

(2) Other documents to be delivered are:

Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 5 of 12

6) Miscellaneous. Miscellaneous (a) Address for Notices: For the purposes of Section 12(a) of the ISDA Form Master Agreement: Address for notices or communications to BSFP: Address: 383 Madison Avenue, New York, New York 10179 Attention: DPC Manager Facsimile: (212) 272-5823 Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 6 of 12 with a copy to: Address: One Metrotech Center North, Brooklyn, New York 11201 Attention: Derivative Operations - 7th Floor Facsimile: (212) 272-1634 (For all purposes) Address for notices or communications to the Counterparty: Address: Citibank, N.A. 390 Greenwich Street - 6th Floor Attention: Phil Sears Facsimile: 212-723-8604 Phone: 212-723-1145 (For all purposes) (b) Process Agent. For the purpose of Section 13(c) of the ISDA Form Master Agreement: BSFP appoints as its Process Agent: Not Applicable The Counterparty appoints as its Process Agent: Not Applicable (c) Offices. The provisions of Section 10(a) of the ISDA Form Master Agreement will not apply to this Agreement; neither BSFP nor the Counterparty have any Offices other than as set forth in the Notices Section and BSFP agrees that, for purposes of Section 6(b) of the ISDA Form Master Agreement, it shall not in future have any Office other than one in the United States. (d) Multibranch Party. For the purpose of Section 10(c) of the ISDA Form Master Agreement: BSFP is not a Multibranch Party. The Counterparty is a Multibranch Party. (e) Calculation Agent. The Calculation Agent is BSFP; provided, however, that if an Event of Default occurs with respect to BSFP, then the Counterparty shall be entitled to appoint a financial institution which would qualify as a Reference Market-maker to act as Calculation Agent. Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 7 of 12 (f) Credit Support Document. Not applicable for either BSFP or the Counterparty. (g) Credit Support Provider. BSFP: Not Applicable The Counterparty: Not Applicable (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. (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. 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. (j) Consent to Recording. Each party hereto consents to the monitoring or recording, at any time and from time to time, by the other party of any and all communications between officers or employees of the parties, waives any further notice of such monitoring or recording, and agrees to notify its officers and employees of such monitoring or recording. (k) 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. (l) BSFP will not unreasonably withhold or delay its consent to an assignment of this Agreement to any other third party. (m) Set-Off. Notwithstanding any 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. The provisions for Set-Off set fort in Section 6(e) of the Agreement shall not apply for purposes of this Transaction. Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 8 of 12 7) "Affiliate" will have the meaning specified in Section 14 of the ISDA Form Master Agreement, provided that BSFP shall not be deemed to have any Affiliates for purposes of this Agreement, including for purposes of Section 6(b)(ii) of the ISDA Form Master Agreement. 8) Section 3 of the ISDA Form Master Agreement is hereby amended by adding at the end thereof the following subsection (g): "(g) Relationship Between Parties. Each party represents to the other party on each date when it enters into a Transaction that:-- (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) It has the capacity to evaluate (internally or through independent professional advice) the Transaction and has made its own decision to enter into the Transaction; and (ii) It understands the terms, conditions and risks of the Transaction and is willing and able to accept those terms and conditions and to assume those risks, financially and otherwise. (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) Principal. It is entering into the Transaction as principal, and not as agent or in any other capacity, fiduciary or otherwise." (5) Eligible Contract Participant. Each party constitutes an "eligible contract participant" as such term is defined in Section 1(a)12 of the Commodity Exchange Act, as amended. NEITHER THE BEAR STEARNS COMPANIES INC. NOR ANY SUBSIDIARY OR AFFILIATE OF THE BEAR STEARNS COMPANIES INC. OTHER THAN BSFP IS AN OBLIGOR OR A CREDIT SUPPORT PROVIDER ON THIS AGREEMENT. 5. Account Details and Settlement Information: Payments to BSFP: Citibank, N.A., New York Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 9 of 12 ABA Number: 021-0000-89, for the account of Bear, Stearns Securities Corp. Account Number: 0925-3186, for further credit to Bear Stearns Financial Products Inc. Sub-account Number: 102-04654-1-3 Attention: Derivatives Department Payments to Counterparty: [Please provide] 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. Counterparty hereby agrees to check this Confirmation and to confirm that the foregoing correctly sets forth the terms of the Transaction by signing in the space provided below and returning to BSFP a facsimile of the fully-executed Confirmation to 212-272-9857. For inquiries regarding U.S. Transactions, please contact Susan Donlon by telephone at 212-272-2364. For all other inquiries please contact Derivatives Documentation by telephone at 353-1-402-6233. Originals will be provided for your execution upon your request. 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, BEAR STEARNS FINANCIAL PRODUCTS INC. By: /s/ Annie Manevitz Name: Annie Manevitz Title: Authorized Signatory Counterparty, acting through its duly authorized signatory, hereby agrees to, accepts and confirms the terms of the foregoing as of the Trade Date. CITIBANK, N.A., NEW YORK BRANCH By: /s/ Frank A. Licciardello As authorized agent or officer for Citibank, N.A. Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 10 of 12 Name: Frank A. Licciardello Title: Authorized Signatory lm/am Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 11 of 12 SCHEDULE I Notional Amount From and Including To but excluding (USD) ------------------ ---------------- ----- Effective Date 6/25/2006 ^174,743,000 6/25/2006 7/25/2006 172,133,878 7/25/2006 8/25/2006 169,125,795 8/25/2006 9/25/2006 165,723,081 9/25/2006 10/25/2006 161,931,312 10/25/2006 11/25/2006 157,757,407 11/25/2006 12/25/2006 153,209,623 12/25/2006 1/25/2007 148,297,543 1/25/2007 2/25/2007 143,032,054 2/25/2007 3/25/2007 137,425,323 3/25/2007 4/25/2007 131,490,765 4/25/2007 5/25/2007 125,243,001 5/25/2007 6/25/2007 118,929,065 6/25/2007 7/25/2007 113,695,523 7/25/2007 8/25/2007 108,644,883 8/25/2007 9/25/2007 103,775,127 9/25/2007 10/25/2007 99,084,214 10/25/2007 11/25/2007 94,570,076 11/25/2007 12/25/2007 90,230,623 12/25/2007 1/25/2008 86,063,742 1/25/2008 2/25/2008 82,067,296 2/25/2008 3/25/2008 78,239,124 3/25/2008 4/25/2008 74,577,044 4/25/2008 5/25/2008 71,078,850 5/25/2008 6/25/2008 67,742,316 6/25/2008 7/25/2008 64,565,191 7/25/2008 8/25/2008 61,545,209 8/25/2008 9/25/2008 58,680,077 9/25/2008 10/25/2008 55,967,487 10/25/2008 11/25/2008 53,405,111 11/25/2008 12/25/2008 50,905,630 12/25/2008 1/25/2009 48,468,020 1/25/2009 2/25/2009 46,091,267 2/25/2009 3/25/2009 43,774,376 3/25/2009 4/25/2009 41,516,366 4/25/2009 5/25/2009 39,316,268 5/25/2009 6/25/2009 37,173,131 6/25/2009 7/25/2009 35,086,016 7/25/2009 8/25/2009 33,053,997 8/25/2009 9/25/2009 31,076,165 9/25/2009 10/25/2009 29,151,622 Reference Number: FXNEC8279 - Amended Citibank, N.A., New York Branch May 26, 2006 Page 12 of 12 10/25/2009 11/25/2009 27,279,484 11/25/2009 12/25/2009 25,458,880 12/25/2009 1/25/2010 23,688,953 1/25/2010 2/25/2010 21,968,856 2/25/2010 3/25/2010 20,297,758 3/25/2010 4/25/2010 18,674,839 4/25/2010 5/25/2010 17,099,291 5/25/2010 6/25/2010 15,570,317 6/25/2010 7/25/2010 14,087,135 7/25/2010 8/25/2010 12,648,972 8/25/2010 9/25/2010 11,255,068 9/25/2010 10/25/2010 9,904,673 10/25/2010 11/25/2010 8,597,049 11/25/2010 12/25/2010 7,331,470 12/25/2010 1/25/2011 6,107,219 1/25/2011 2/25/2011 4,923,591 2/25/2011 3/25/2011 3,779,892 3/25/2011 4/25/2011 2,675,437 4/25/2011 5/25/2011 1,609,553 5/25/2011 6/25/2011 581,575 6/25/2011 Termination Date 200,331

Alternative Loan Trust 2006-21CB 8-K