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part of the interest payments next coming due upon proof of Bondholder entitlement <br />to interest payments and delivery to the Insurance Trustee, in form satisfactory to <br />the Insurance Trustee, of an appropriate assignment of the registered owner's right <br />to payment, (iii) that should they be entitled to receive full payment of principal from <br />AMBAC Indemnity, they must surrender their Bonds (along with an appropriate <br />instrument of assignment in form satisfactory to the Insurance Trustee to permit <br />ownership of such Bonds to be registered in the name of AMBAC Indemnity) for <br />payment to the Insurance Trustee, and not the Trustee or Paying Agent, if any, and <br />(iv) that should they be entitled to receive partial payment of principal from AMBAC <br />Indemnity, they must surrender their Bonds for payment thereon first to the Trustee <br />or Paying Agent, if any, who shall note on such Bonds the portion of the principal <br />paid by the Trustee or Paying Agent, if any, and then, along with an appropriate <br />instrument of assignment in form satisfactory to the Insurance Trustee, to the <br />Insurance Trustee, which will then pay the unpaid portion of principal. <br />(e) in the event that the Trustee or Paying Agent, if any, has notice that any payment <br />of principal of or interest on a Bond which has become Due for Payment and which <br />is made to a Bondholder by or on behalf of the Issuer has been deemed a <br />preferential transfer and theretofore recovered from its registered owner pursuant to <br />the United States Bankruptcy Code by a trustee in bankruptcy in accordance with <br />the final, nonappealable order of a court having competent jurisdiction, the Trustee <br />or Paying Agent, if any, shall, at the time AMBAC Indemnity is notified pursuant to <br />(a) above, notify all registered owners that in the event that any registered owner's <br />payment is so recovered, such registered owner will be entitled to payment from <br />AMBAC Indemnity to the extent of such recovery if sufficient funds are not otherwise <br />available, and the Trustee or Paying Agent, if any, shall furnish to AMBAC Indemnity <br />its records evidencing the payments of principal of and interest on the Bonds which <br />have been made by the Trustee or Paying Agent, if any, and subsequently <br />recovered from registered owners and the dates on which such payments were <br />made. <br />(f) in addition to those rights granted AMBAC Indemnity under this [Financing <br />Document], AMBAC Indemnity shall, to the extent it makes payment of principal of or <br />interest on Bonds, become subrogated to the rights of the recipients of such <br />payments in accordance with the terms of the Municipal Bond Insurance Policy, and <br />to evidence such subrogation (i) in the case of subrogation as to claims for past due <br />interest, the Trustee or Paying Agent, if any, shall note AMBAC Indemnity's rights as <br />subrogee on the registration books of the Issuer maintained by the Trustee or <br />Paying Agent, if any, upon receipt from AMBAC Indemnity of proof of the payment of <br />interest thereon to the registered owners of the Bonds, and (ii) in the case of <br />subrogation as to claims -for past due principal, the Trustee or Paying Agent, if any, <br />shall note AMBAC Indemnity's rights as subrogee on the registration books of the <br />Issuer maintained by the Trustee or Paying Agent, if any, upon surrender of the <br />Bonds by the registered owners thereof together with proof of the payment of <br />principal thereof. <br />12 <br />