[step:Use a least-failure function to rule out failure of strongness]Assume clause 2. Fix $A\subset V_\delta$. Suppose, toward a contradiction, that clause 1 fails for this $A$. Thus, for every cardinal $\kappa<\delta$, there is an ordinal $\lambda$ with $\kappa<\lambda<\delta$ such that $\kappa$ is not $\lambda$-$A$-strong.
Define a function $f_A:\delta\to\delta$ as follows. If $\xi<\delta$ is a cardinal and there is an ordinal $\lambda$ with $\xi<\lambda<\delta$ such that $\xi$ is not $\lambda$-$A$-strong, then $f_A(\xi)$ is the least such ordinal. If $\xi$ is not in that case, set $f_A(\xi):=\xi+1$. The values are below $\delta$: in the least-failure case this is part of the definition, and in the fallback case it follows from the fact that $\delta$ is a limit ordinal. By the class-embedding convention in the statement, $f_A$ is a set function on $\delta$.
Apply clause 2 to the set $A$ and the function $f_A$. We obtain a cardinal $\kappa<\delta$, a transitive class $M$, and an elementary embedding $j:V\to M$ such that $\operatorname{crit}(j)=\kappa$, $f_A``\kappa\subset\kappa$, $\theta:=j(f_A)(\kappa)<\delta$, $f_A(\kappa)\leq\theta$, $j(\kappa)>\theta$, $V_\theta\subset M$, and $j(A)\cap V_\theta=A\cap V_\theta$.
Since clause 1 was assumed to fail for $A$, the input $\kappa$ falls into the least-failure case. Hence $f_A(\kappa)$ is an ordinal satisfying $\kappa<f_A(\kappa)<\delta$, and $\kappa$ is not $f_A(\kappa)$-$A$-strong. On the other hand, the embedding $j$ witnesses that $\kappa$ is $\theta$-$A$-strong: its critical point is $\kappa$, it satisfies $j(\kappa)>\theta$, it has $V_\theta\subset M$, and it preserves $A$ through $V_\theta$.
Because $f_A(\kappa)\leq\theta$, the same embedding also witnesses that $\kappa$ is $f_A(\kappa)$-$A$-strong. Indeed $j(\kappa)>\theta\geq f_A(\kappa)$, $V_{f_A(\kappa)}\subset V_\theta\subset M$, and restricting $j(A)\cap V_\theta=A\cap V_\theta$ to $V_{f_A(\kappa)}$ gives
\begin{align*}
j(A)\cap V_{f_A(\kappa)}=A\cap V_{f_A(\kappa)}.
\end{align*}
This contradicts the definition of $f_A(\kappa)$ as a failure level.[/step]