UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant To Section 13 or 15 (d) of the

Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) — July 1, 2009

ASSURED GUARANTY LTD.

(Exact name of registrant as specified in its charter)

Bermuda		001-32141		98-0429991
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)

Assured Guaranty Ltd.

30 Woodbourne Avenue

Hamilton HM 08 Bermuda

(Address of principal executive offices)

Registrant’s telephone number, including area code: (441) 299-9375

Not applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement

As previously announced, on November 14, 2008, Assured Guaranty Ltd. ( “Assured” or the “Company”) entered into an agreement (the “Purchase Agreement”) with Dexia Holdings, Inc., a Delaware corporation (“Seller” or “Dexia Holdings”) and Dexia Crédit Local S.A., a French share company licensed as a bank under French law (“DCL”) pursuant to which the Company agreed to purchase (the “Acquisition”) Financial Security Assurance Holdings Ltd., a New York corporation (“FSAH”), the parent of financial guaranty insurance company Financial Security Assurance, Inc., a New York stock insurance company (“FSA”), on the terms and conditions contained in the Purchase Agreement, a copy of which was included as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed on November 17, 2008.

Separation of FSAH’s Former Financial Products Segment

FSAH, through its insurance company subsidiaries, provides financial guaranty insurance on public finance obligations in domestic and international markets. Historically, FSAH also provided financial guaranty insurance on asset-backed obligations. In August 2008, FSAH announced that it would cease insuring asset-backed obligations and instead participate exclusively in the global public finance financial guaranty business.

Prior to November 2008 and as further described below, FSAH, through its financial products subsidiaries, offered FSA-insured guaranteed insurance contracts (“GICs”) and other investment agreements, including medium-term notes (“MTNs”). As further described below, Assured did not acquire FSAH’s former financial products business and has entered into various agreements with Dexia Holdings and/or certain of its affiliates pursuant to which they will assume the credit and liquidity risks associated with FSAH’s former financial products business.

Guaranteed Investment Contract Business

Until November 2008, FSAH issued, through its financial products business, FSA-insured GICs and other investment agreements to municipalities and other market participants (the “GIC Business”). In November 2008, FSAH ceased to issue new GICs in anticipation of the Acquisition. The GICs were issued through FSAH’s non-insurance subsidiaries (the “GIC Issuers”) FSA Capital Management Services LLC, FSA Capital Markets Services LLC and FSA Capital Markets Services (Caymans) Ltd. In return for an initial payment, each GIC entitles its holder to receive the return of the holder’s invested principal plus interest at a specified rate and to withdraw principal from the GIC as permitted by its terms. FSA insures the GIC Issuer’s payment obligations on all GICs issued by the GIC Issuers.

The proceeds of GICs issued by the GIC Issuers were loaned to FSAH’s subsidiary FSA Asset Management LLC (“FSAM” and, together with the GIC Issuers, the “GIC Subsidiaries”) pursuant to certain intercompany financing agreements between the GIC Issuers and FSAM (the “Intercompany Financings”). FSAM in turn invested these funds in fixed-income obligations (primarily residential mortgage backed securities) but also short-term investments, securities issued or guaranteed by U.S. government sponsored agencies, taxable municipal bonds, securities issued by utilities, infrastructure-related securities, collateralized debt obligations, other asset-backed securities and foreign currency denominated securities) that satisfied FSA’s investment criteria (the “FSAM assets”). The terms governing FSAM’s repayment of GIC proceeds to the GIC Issuers under the Intercompany Financings were intended to match the payment terms under the related GIC. FSAH historically depended in large part on operating cash flow from interest and principal payments on the FSAM assets to provide sufficient liquidity to pay the GICs on a timely basis. FSAH also sought to manage the financial products business liquidity risk through the maintenance of liquid collateral and liquidity agreements. During the course of 2008, FSAH’s former financial products business developed significant liquidity shortfalls as a result of a number of factors, including (i) greater than anticipated GIC withdrawals and terminations due, for the most part, to redemptions caused by events of default under collateral debt obligations backed by asset-backed securities and under collateralized loan obligations; (ii) slower than anticipated amortization of residential

mortgage-backed securities, which comprise most of the portfolio of FSAM assets; (iii) redemption/collateralization requirements triggered by the downgrade of FSA’s ratings; and (iv) a significant decline in market value of certain of the FSAM assets due to a general market dislocation, leading to many of the FSAM assets becoming illiquid.

Further, liquidity requirements have increased as FSA has been downgraded or placed on negative outlook by the three major rating agencies. Certain of the FSA-insured GICs allowed for withdrawal of GIC funds in the event of a downgrade of FSA below AAA by Standard & Poor’s (“S&P”) or Aaa by Moody’s Investors Service (“Moody’s”) unless the GIC Issuer posted liquid collateral or otherwise enhanced its credit. Such downgrades resulted in the need to post liquid collateral to the related GIC holder or the need to raise funds to satisfy GIC withdrawals. In addition to additional liquidity requirements caused by downgrades of FSA’s ratings to its current levels under certain GICs, most FSA-insured GICs allow for withdrawal of GIC funds in the event of a downgrade of FSA below AA- by S&P or Aa3 by Moody’s, unless the GIC Issuer posts liquid collateral or otherwise enhances its credit. Some FSA-insured GICs also allow for withdrawal of GIC funds in the event of a downgrade of FSA, typically below A3 by Moody’s or A- by S&P, with no right of the GIC Issuer to avoid such withdrawal by posting collateral or otherwise enhancing its credit.

As of March 31, 2009, there were FSA-insured GIC obligations in an outstanding principal amount of approximately $13.5 billion. As of March 31, 2009, the liabilities of the GIC Issuers and FSAM and its subsidiary exceeded their assets by approximately $8.7 billion (before any tax effects).

Prior to the completion of the Acquisition, FSAH transferred the ownership interest in the GIC Issuers and FSAM to Dexia Holdings. Even though FSAH no longer owns the GIC Issuers or FSAM, FSA’s guarantees of the GICs remain in place.

In connection with the Acquisition and as further described below, Dexia S.A. (“Dexia”), Dexia Holdings’ ultimate parent, and certain of its affiliates have entered into a number of agreements pursuant to which they have guaranteed certain amounts, agreed to lend certain amounts or post liquid collateral, and agreed to provide hedges against interest rate risk to or in respect of FSAH’s former financial products business. Certain of these obligations also benefit from a guarantee from the Belgian and French States. The purpose of these agreements is to mitigate the credit, interest rate and liquidity risks associated with the GIC business and the related FSA guarantees.

Medium Term Note Business and Leveraged Tax Lease Business

The MTN Business —The “MTN Business” refers to the MTN issuance program of FSA Global Funding Limited (“FSA Global”). Under the MTN Business, MTNs were issued by FSA Global and are insured under financial guarantee insurance policies issued by FSA. The proceeds of the MTNs were used to purchase notes issued by Cypress Point Funding Limited (“Cypress”) and other non-affiliated entities. The MTNs are secured by all of the assets of FSA Global, including the A-Loans (as defined below). The notes securing the MTNs are also insured under financial guarantee insurance policies issued by FSA. The MTNs and the notes issued by Cypress are also supported by interest rate swaps, currency swaps and basis swaps, each of which are insured under financial guarantee insurance policies issued by

FSA. As of March 31, 2009, the aggregate outstanding principal balance of MTNs was $1.6 billion.

Prior to the completion of the Acquisition, FSAH transferred its ownership interest in FSA Global to Dexia Holdings. Even though FSAH no longer owns FSA Global, FSA’s guarantees of the MTNs and the notes securing the MTNs remain in place.

In connection with the Acquisition and as further described below, Dexia and certain of its affiliates have entered into a number of guarantees and other agreements pursuant to which they have retained all rights and obligations related to and incurred in connection with the operation of the MTN Business and have all existing and future economic risks, benefits and profits associated with that business, although, as noted above, FSA’s guarantees of the MTNs and the notes securing the MTNs remain in place. None of these obligations benefit from a guarantee from the Belgian or French States.

The Leveraged Tax Lease Business —The “Leveraged Tax Lease Business” refers to leveraged-lease transactions involving FSA Global, Premier International Funding Co. (“Premier”), various lessees and various lessor trusts. In certain transactions under the Leveraged Tax Lease Business, a debt payment undertaking agreement (“Debt PUA”) and/or an equity payment undertaking agreement (“Equity PUA”) were entered into by Premier in exchange for cash payments by the related lessee in an amount sufficient to defease the lessee’s rental obligation under the related lease. In conjunction with its issuance of a Debt PUA, Premier received a note in a corresponding amount from FSA Global (the “Debt PUA Note”) and in conjunction with its issuance of an Equity PUA, Premier received a note in a corresponding amount from FSA Global (the “Equity PUA Note”). The Debt PUAs and Debt PUA Notes are insured under financial guarantee insurance policies issued by FSA. In conjunction with its issuance of each Debt PUA Note, FSA Global received a loan certificate from the related lessor trust (each, an “A-Loan”). In each transaction, the repayment of the A-Loans is secured by the related Debt PUA which is in turn insured by FSA. Monthly payments are made under the A-Loans and Debt PUA Notes to reduce the outstanding amount of the A-Loans and Debt PUA Notes and to reduce FSA’s exposure under its financial guaranty insurance policies that insure the Debt PUAs.

As of March 31, 2009, the outstanding amounts of A-Loans and Debt PUA Notes were each $6.2 billion.

Prior to the completion of the Acquisition, FSAH transferred its ownership interest in FSA Global and Premier to Dexia Holdings. Even though FSAH no longer owns FSA Global or Premier, FSA’s guarantees of the Debt PUAs and Debt PUA Notes remain in place.

As further described below, Assured has agreed to be responsible for all rights and obligations related to the operation of the Leveraged Tax Lease Business and the FSA insurance policies insuring the Debt PUAs and the Debt PUA Notes and Dexia Holdings has agreed to assume all rights and obligations relating to the Equity PUA Notes and the Equity PUAs and to hold FSA harmless and indemnify FSA for its obligations under the FSA insurance policies relating to the Equity PUA Notes and the Equity PUAs. In addition, an affiliate of Dexia has agreed to provide a liquidity facility to FSA in an amount not to exceed $1 billion for the purpose

of covering the liquidity risk arising out of claims payable in respect of “strip coverages” included in the Leveraged Tax Lease Business.

See also Item 8.01—Other Events —Risks Relating to the Acquisition and Integration of FSAH — We have exposure through financial guaranty insurance policies to FSAH’s Financial Products business, which we did not acquire and Item 8.01—Other Events—Risks Relating to the Acquisition and Integration of FSAH —We have substantial credit and liquidity exposure to Dexia and the Belgian and French states.

GIC Business Agreements

To address the credit and liquidity risks of the GIC business summarized above, the following discussion summarizes the significant agreements entered into to mitigate the credit and liquidity risks associated with the GIC business and the related FSA guarantees. Each of these agreements is dated June 30, 2009.

Dexia Put Contracts —Dexia and DCL have jointly and severally guaranteed the scheduled payments of interest and principal in relation to each FSAM asset, as well as any failure to provide liquidity or liquid collateral under the Guaranteed Liquidity Facilities under two separate ISDA Master Agreements, each with its associated schedule, confirmation and credit support annex (the “Guaranteed Put Contract” and the “Non-Guaranteed Put Contract” respectively, and collectively, the “Dexia Put Contracts”). The Guaranteed Put Contract is so described because Dexia’s obligations under the put contract are generally guaranteed by the Sovereign Guarantee (as defined below). The Dexia Put Contracts also reference separate portfolios of FSAM assets. Based on information as of June 30, 2009, the initial aggregate principal balance of FSAM assets related to the Guaranteed Put Contract is equal to approximately $11.8 billion and the aggregate principal balance of FSAM assets related to the Non-Guaranteed Put Contract is equal to approximately $4.4 billion. The assets owned by FSAM as of September 30, 2008 were allocated to the Guaranteed Put Contract and the Non-Guaranteed Put Contract based on discussions between Dexia and the French State and the Belgian State (collectively, the “States”), with the less liquid and more deeply discounted assets generally being allocated to the Guaranteed Put Contract.

Under the Dexia Put Contracts the obligation of Dexia and DCL to provide amounts to FSAM will arise pursuant to the occurrence of any of the following events (each, a “Put Trigger”):

· a payment default by DCL or Dexia Bank Belgium S.A. (“DBB”) under any Guaranteed Liquidity Facility (as defined below) (a “Liquidity Default Trigger”);

· a failure by either Dexia or DCL to transfer the required amount of eligible collateral under the credit support annex of the applicable Dexia Put Contract (a “Collateral Default Trigger”);

· the occurrence of an insolvency event with respect to Dexia as set forth in the Dexia Put Contracts (a “Bankruptcy Trigger”); and

· with respect to an FSAM asset, the failure of the issuer of that FSAM asset to pay the full amount of the expected principal or interest when due, a writedown or applied loss resulting in a reduction of the outstanding principal amount of that FSAM asset, or the attribution of a principal deficiency or realized loss resulting in a reduction or subordination of the current interest payable on that FSAM asset (an “Asset Default Trigger”).

In the event that the applicable Dexia party fails to provide liquidity or collateral as required under the Guaranteed Liquidity Facilities, FSAM may, pursuant to a Liquidity Default Trigger or Collateral Default Trigger, put to Dexia and DCL certain of the FSAM assets in exchange for an amount equal to such failure, with such amounts being available to satisfy the GIC Issuers’ obligations under the GICs and/or FSAM’s obligations under the FSAM Hedging Arrangements (as defined below), which are also guaranteed by FSA.

If a Dexia bankruptcy has occurred, FSAM may, pursuant to a Bankruptcy Trigger, put to Dexia and DCL the relevant FSAM assets with a value equal to the lesser of (i) the aggregate outstanding principal amount of all FSAM assets in the relevant portfolio and (ii) the aggregate outstanding principal balance of all of the GICs.

If an Asset Default Trigger arises with respect to any FSAM asset, FSAM may put to Dexia and DCL that FSAM asset in exchange for the outstanding principal amount of that FSAM asset. Dexia and DCL have the right, however, to elect to pay the difference between the amount of the

expected principal or interest payment and the amount of the actual principal or interest payment, in each case, as such amounts come due.

In the event Dexia and DCL fail to perform under the Guaranteed Put Contract, FSAM may exercise a guarantee call under the Sovereign Guarantee. See “—Sovereign Guarantee” below.

To secure each Dexia Put Contract, Dexia and DCL will post under each put contract to the respective custodian from time to time eligible collateral having an aggregate value (subject to agreed “haircuts”) equal to at least the excess of (i) the aggregate principal amount of all outstanding GICs over (ii) the aggregate mark-to-market value of FSAM’s assets; provided that prior to September 29, 2011 (the “Expected First Collateral Posting Date”) the aggregate mark-to-market value of the FSAM assets related to the Guaranteed Put Contract will be deemed to be equal to the aggregate unpaid principal balance of these assets for purposes of this calculation. Additional collateralization is required in respect of certain other liabilities of FSAM, including certain net posting obligations of FSAM under the FSAM Hedging Arrangements, an agreed costs amount for running the GIC business and the expected negative carry associated with the GICs that would be borne by FSAM following a Dexia event of default. The valuation of the aggregate mark-to-market value of the FSAM assets and the posted collateral will occur at least weekly. Dexia’s and DCL’s obligation to post collateral or right to receive the return of excess collateral is subject, in either case, to satisfaction of the applicable threshold of $5 million, among other conditions.

Because the FSAM assets related to the Guaranteed Put Contract will be valued at their aggregate unpaid principal balance prior to the Expected First Collateral Posting Date, it is expected that Dexia and DCL will not be required to post collateral until the Expected First Collateral Posting Date. A failure by Dexia and DCL to post the amount described in the immediately preceding paragraph on the Expected First Collateral Posting Date will be covered by the Sovereign Guarantee. In the event of an ISDA event of default under the Dexia Put Contracts, FSAM may declare an early termination date and retain collateral posted by Dexia and DCL in accordance with the credit support annexes.

Notwithstanding the provisions for the calculation of posting of collateral with respect to the Dexia Put Contracts set forth above, and because many GICs provide that the collateral posting obligations and withdrawals that would arise following a downgrade of FSA would not be applicable if the relevant GIC Issuer is rated above certain levels at the time of any such downgrade of FSA, if each of Moody’s, S&P and Fitch Ratings (“Fitch”) confirm that the GIC Issuers’ obligations in relation to the GICs will be rated at least “Aa2/AA/AA” respectively (without giving effect to the retained FSA guarantees on the GICs) with a lesser amount of collateral being required to be posted by Dexia and DCL under the credit support annexes, then the collateral required to be posted under the credit support annexes will be reduced to such lesser amount acceptable to the rating agencies.

Under each of the Dexia Put Contracts, FSAM will pay to Dexia and DCL a premium quarterly in arrears (the “Put Premium”). FSAM’s obligation to pay the Put Premium is subordinated to the GIC Subsidiaries’ obligations under the GICs and the FSAM Hedging Arrangements and to reimburse FSA for any amounts paid under the FSA guarantees related to the GICs and FSAM Hedging Arrangements and a failure by FSAM to pay the Put Premiums is not an event of default under the Put Contracts. In addition, following a Dexia event of default, FSAM will only pay the Put Premiums if the Subordinated Claims Payment Condition (as defined below) is satisfied.

While neither the Company nor any of its subsidiaries is a party to the Dexia Put Contracts, the Dexia Put Contracts enhance FSAM’s ability to meet its obligations in respect of the GICs insured by FSA. As of March 31, 2009, the liabilities of the GIC Issuers and FSAM and its subsidiary exceeded their assets by approximately $8.7 billion (before any tax effects).

Sovereign Guarantee —Pursuant to a guarantee (the “Sovereign Guarantee”) issued by the States of Belgium and France (the “States”) to FSAM, the States have guaranteed severally but not jointly Dexia’s obligations under the Guaranteed Put Contract, subject to any applicable limitations set forth therein. The State of Belgium is responsible for 60.5/97 of the Sovereign Guarantee and the State of France is responsible for 36.5/97 of the Sovereign Guarantee. The Sovereign Guarantee will directly guarantee, for the benefit of FSAM (and indirectly for the benefit of the GIC Issuers and FSA), the payment obligations

of Dexia under the Guaranteed Put Contract in respect of Liquidity Default Triggers, Collateral Default Triggers, the Bankruptcy Trigger and Asset Default Triggers. To the extent FSAM fails to make a timely call under the Sovereign Guarantee, FSA will have the right to request payment from the States thereunder. Under a sovereign guarantee reimbursement agreement, Dexia, and not the GIC Subsidiaries, is obligated to pay the guarantee fee due and payable to the States under the Sovereign Guarantee and reimburse the States for certain amounts paid under the Sovereign Guarantee, but a failure by Dexia to pay the guarantee fee or any other amounts required to be paid or reimbursed under the sovereign guarantee reimbursement agreement is not a defense or condition to the obligations of the States under the Sovereign Guarantee.

The States’ guaranty with respect to Liquidity Default Triggers and Collateral Default Triggers is scheduled to expire on October 31, 2011 (the “Liquidity and Collateral Trigger Expiration Date”). The States’ guaranty with respect to the related defaulted FSAM assets or a Dexia bankruptcy is scheduled to expire on the earlier of (x) the final maturity of the latest maturing of the remaining FSAM assets related to the Guaranteed Put Contract, and (y) March 30, 2035. The Sovereign Guarantee may terminate early if FSAM elects to undertake a Refinancing (as defined below) and meets the necessary requirements described in “—Pledge and Administration Agreement” below.

Dexia FP Guarantee —Pursuant to a guarantee jointly and severally issued by Dexia and DCL to FSA (the “Dexia FP Guarantee”), all of the GIC Subsidiaries’ payment and/or collateral posting obligations under the GICs and the FSAM Hedging Arrangements that are guaranteed by FSA are guaranteed by Dexia and DCL. FSAM’s obligations to reimburse Dexia and DCL for amounts paid under the Dexia FP Guarantee and to pay the related guarantee fee will be subordinated to the GIC Subsidiaries’ obligations under the GICs and the FSAM Hedging Arrangements that are guaranteed by FSA and to reimburse FSA for any amounts paid under the FSA guarantees related to the GICs and FSAM Hedging Arrangements. In addition, following a Dexia event of default, FSAM will only pay the guarantee fee under the Dexia FP Guarantee if the Subordinated Claims Payment Condition is satisfied. Any failure by FSAM to reimburse Dexia and DCL for amounts paid under the Dexia FP Guarantee or to pay the related guarantee fee is not a defense or condition to the obligations of Dexia and DCL under the Dexia FP Guarantee.

Dexia GIC Indemnity —Pursuant to an indemnification agreement between FSA, Dexia and DCL (the “Dexia GIC Indemnity”), Dexia and DCL will indemnify FSA for certain losses, liabilities and damages (including reasonable costs and expenses) incurred by FSA or any affiliate of FSA related to the GIC business or any of the transactions related to the isolation and segregation of the GIC business that are not otherwise reimbursed pursuant to the Dexia FP Guarantee.

Pledge and Administration Agreement —Pursuant to the pledge and administration agreement among Dexia, DCL, Dexia FP Holdings Inc. (“Dexia FP”), the GIC Subsidiaries, FSA and the Collateral Agent (the “Pledge and Administration Agreement”), Dexia, DCL and the GIC Subsidiaries have granted security interests to the Collateral Agent for the benefit and security of the secured

parties therein (including FSA) over all of their right, title and interest in, to and under the FSAM assets, the collateral posted by Dexia or DCL under the Dexia Put Contracts, and other related assets.

Also pursuant to the Pledge and Administration Agreement, Dexia FP has granted a security interest to the Collateral Agent for the benefit and security of FSA over all of its right, title and interest in HF Services LLC (“HF Services”), including any and all management, voting, approval and other rights of Dexia FP under the organizational documents of HF Services to secure the payment of all amounts due on all of the indebtedness, liabilities and obligations owed from time to time by FSAM and the GIC Issuers to FSA.

Unless a Dexia event of default has occurred, Dexia will direct the day to day operations of the GIC Subsidiaries and will direct the management of the assets and liabilities of the GIC Subsidiaries, including but not limited to cash management, asset liability management and other normal day to day operations of the GIC Subsidiaries through the Administrator (as defined below). If a Dexia event of default has occurred, FSA will have the right to exercise the directing rights described in this paragraph.

In addition, FSAM has agreed not to sell or liquidate any FSAM asset other than with the prior consent of Dexia, unless a Dexia event of default has occurred, and not to sell or liquidate any FSAM asset other than for consideration equal to the par amount thereof plus accrued interest, without the consent of FSA.

A “Dexia event of default” under the Pledge and Administration Agreement will include the following:

· the occurrence of any ISDA event of default under either of the Dexia Put Contracts;

· the non-payment by any Dexia party or any affiliate of any required payment in accordance with the terms of any Dexia guarantee, the Dexia Put Contracts or the Dexia GIC Indemnity where (i) the amount of such non-payment, taken together with any other outstanding and uncured failures to make payments or deliveries by any Dexia party or any affiliate exceeds $10,000,000 and (ii) such non-payment is not remedied by a cure generally within 5 business days of the receipt of notice of such nonpayment; and

· certain events of bankruptcy in respect of Dexia or its affiliates or the GIC Subsidiaries occurring and continuing at any time.

Upon the occurrence of a Dexia event of default, FSA may take any or all of the following actions:

· cause the repurchase date to occur in respect of all or any part of the transactions entered into under the master repurchase agreement, exercise the rights of a secured party in relation to the collateral, and direct the collateral agent to exercise all rights to vote or give directions or consents as a holder of such collateral following enforcement of its security interest;

· terminate the Administrative Services Agreement (as defined below) or replace the administrator thereunder or direct the management of the administrator by foreclosing upon its security interest in the equity of HF Services;

· with respect to the Non-Guaranteed Put Contract, designate an “early termination date,” demand payment of any related early termination payments and exercise the rights of a secured party in relation to the collateral posted under the Non-Guaranteed Put credit support annex;

· with respect to the Guaranteed Put Contract, if the Dexia event of default also constitutes an ISDA event of default, designate an “early termination date,” demand payment of any

related early termination payments and exercise the rights of a secured party in relation to the collateral posted under the credit support annex; and

· maintain any Dexia guarantees in force, make claims in accordance with the terms of any Dexia guarantee, any liquidity facility or the Sovereign Guarantee (if the Guaranteed Put Contract has not been terminated) and apply any collateral to unpaid liabilities of FSAM.

In addition, either pursuant to the occurrence of a Dexia event of default or upon the satisfaction of certain conditions relating to the refinancing of Dexia’s obligations under the GIC Business documents (the “Refinancing”), FSA may elect to refinance its obligations related to the GICs by terminating the Master Repurchase Agreement (as defined below), the Sovereign Guarantee, and the Dexia Put Contracts and releasing certain other assets from the Collateral Agent’s lien under the Pledge and Administration Agreement, the proceeds of which will be invested in certain permitted investments, as contemplated in the Pledge and Administration Agreement. In order to effect a Refinancing, the following conditions, among others, must be satisfied: (i) FSAM must redeem the Master Repurchase Agreement or transfer and novate its rights and obligations under the Master Repurchase Agreement to a successor entity designated by FSA (the “FSAM Successor”) such that the GIC Issuers or the FSAM Successor hold cash or permitted investments equal to the sum of the aggregate outstanding amount of all GIC business related liabilities plus 25% of the agreed costs amount for running the GIC business; (ii) the rating agencies must have confirmed that after the Refinancing the GIC Issuers will be rated at least “Aa2” by Moody’s, at least “AA” by S&P and at least “AA” by Fitch, and that the rating of FSA will not be downgraded, qualified or withdrawn; (iii) all of FSA’s guarantees on the FSAM Hedging Arrangements must have been released by the counterparties thereto; and (iv) the remaining FSAM Hedging Arrangements must have been transferred and novated to the FSAM Successor or other entity designated by FSA.

Guaranteed Liquidity Facilities —In connection with the Acquisition, affiliates of Dexia increased their aggregate liquidity commitment to FSAM from $8.5 billion to $11.5 billion. The liquidity commitments are comprised of an amended and restated revolving credit agreement (the “Liquidity Facility”) pursuant to which DCL and DBB committed to provide funds to FSAM in an amount up to $8.0 billion (approximately $4.2 billion was outstanding under the previously existing revolving credit facility as of June 30, 2009), and a master repurchase agreement (the “Repurchase Facility Agreement” and, together with the Liquidity Facility, the “Guaranteed Liquidity Facilities”) pursuant to which DCL will provide up to $3.5 billion (based on market value) of eligible collateral to satisfy collateralization obligations of the GIC Issuers under the GICs or of FSAM under the FSAM Hedging Arrangements. There is nothing currently outstanding under the Repurchase Facility Agreement. In accordance with the terms of the Guaranteed Liquidity Facilities, FSAM’s obligations to pay certain fees payable under the Guaranteed Liquidity Facilities are subordinated to the GIC Companies’ obligations under the GICs and the FSAM Hedging Arrangements that are guaranteed by FSA and to reimburse FSA for any amounts paid under the FSA guarantees related to the GICs and FSAM Hedging Arrangements. In addition, following certain events of default, FSAM will only be required to pay these fees to the extent certain conditions under the Pledge and Administration Agreement have been met, including, among other things, that FSAM owns a portfolio of liquid securities having an aggregate market value in excess of the aggregate unpaid principal balance of the GICs plus certain additional amounts described in the Pledge and Administration Agreement (such conditions, the “Subordinated Claims Payment Condition”).

The proceeds of GICs issued by the GIC Issuers were loaned to FSAM pursuant to the Intercompany Financings between the GIC Issuers and FSAM. FSAM in turn invested these funds in fixed-income obligations (primarily residential mortgage-backed securities (“RMBS”) but also short-term investments, securities issued or guaranteed by U.S. government sponsored agencies, taxable municipal bonds, securities issued by utilities, infrastructure-related securities, collateralized debt obligations, other asset-backed securities and foreign currency denominated securities) that satisfied FSA’s investment criteria. The terms governing FSAM’s repayment of GIC proceeds to the GIC Issuers under the Intercompany Financings are intended to match the payment terms under the related GIC. To allow it to satisfy these matched payment obligations, when FSAM invested the GIC proceeds in FSAM assets, it also entered into various derivative transactions to convert most fixed-rate FSAM assets and GIC liabilities into London Interbank offered rate (“LIBOR”)-based floating rate assets and liabilities, and to convert non-US dollar-denominated FSAM assets to US dollar-denominated assets (the “FSAM Hedging Arrangements”).

The terms of the Guaranteed Liquidity Facilities will generally extend to the date on which all of the GICs have been paid in full, provided that upon a Dexia event of default under the Pledge and Administration Agreement, FSAM will be entitled to request one final advance under each Guaranteed Liquidity Facility in an aggregate amount expected to be sufficient to repay the principal and interest on the GICs as they become due and payable over time, after giving effect to any collateral posted under the credit support annexes to the Dexia Put Contracts.

While neither the Company nor any of its subsidiaries is a party to to the Guaranteed Liquidity Facilities, the Guaranteed Liquidity Facilities provide liquidity to FSAM to enable it to meet its obligations in respect of the GICs insured by FSA.

Master Repurchase Agreement —FSAM and the GIC Issuers amended, restated and consolidated Intercompany Financings prior to the Acquisition into one master repurchase agreement where each GIC Issuer will be a “buyer” and FSAM will be the “seller” (the “Master Repurchase Agreement”). All of the outstanding indebtedness of FSAM under the Existing Intercompany Financings will continue to be outstanding under the Master Repurchase Agreement, and FSAM’s obligations to the GIC Issuers under the Master Repurchase Agreement will be secured under the Pledge and Administration Agreement. Amounts or collateral received by FSAM under the Guaranteed Liquidity Facilities or the Dexia Put Contracts will be transferred to the GIC Issuers for application to the related GICs pursuant to the Master Repurchase Agreement. If FSAM elects to undertake a Refinancing as described in “—Pledge and Administration Agreement” below, FSAM will, among other things, assign its rights and obligations under the Master Repurchase Agreement to a successor entity.

Medium-Term Note Business and Leveraged Tax Lease Business Agreements

Each of the agreements described below is dated July 1, 2009.

The Separation Agreement —Under the Separation Agreement among DCL, FSA, Financial Security Assurance International Ltd. (“FSA International” and, together with FSA, the “FSA Parties”), FSA Global and Premier:

· DCL has agreed to (i) assume all rights and obligations related to and incurred in connection with the operation of the MTN Business and (ii) manage the day-to-day operations of the MTN Business, and

· FSA has agreed to (i) retain all rights and obligations related to and incurred in connection with the operation of the Leveraged Tax Lease Business (other than Equity PUA Notes and the FSA insurance policies relating to the Equity PUA Notes) and (ii) manage the day-to-day operations of the Leveraged Tax Lease Business.

The Separation Agreement provides that so long as no DCL Event of Default (as defined below) has occurred and is continuing, DCL and the FSA Parties will cooperate reasonably and in good faith to determine how the applicable FSA Party will exercise the consent rights, direction rights and other rights that it has as insurer (“FSA Rights”) under any transaction document relating to the MTN Business (such determination is referred to as a “Mutual Determination”). Neither DCL, nor any of its affiliates, nor any FSA Party, nor any of their respective affiliates, may seek to exercise any FSA Right except pursuant to a Mutual Determination or as otherwise mutually agreed by DCL and the applicable FSA Party. If a DCL Event of Default has occurred and is continuing, the FSA Parties will be permitted to exercise most FSA Rights without consultation with, or consent from, DCL.

DCL Guarantees —DCL has entered into a Funding Guaranty and a Reimbursement Guaranty, (together, the “DCL Guarantees”) each for the benefit of FSA and Financial Security Assurance International, Ltd. (the “Beneficiaries”).

Under the Funding Guaranty, DCL will guaranty, for the benefit of each Beneficiary, the payment to or on behalf of the relevant Beneficiary of an amount equal to the payment required to be

made under an FSA Policy by that Beneficiary. No later than 12:00 p.m. New York time on the later of (i) one Business Day following receipt by DCL of a notice of claim under an FSA Policy, and (ii) one Business Day prior to the date the related obligation is due under the relevant FSA Policy, DCL will make payment either (A) to an account of the beneficiary of the applicable financial guaranty insurance policies issued by the FSA Parties, or (B) to the account specified by the Beneficiary.

Under the Reimbursement Guaranty, DCL will guaranty, for the benefit of each Beneficiary, the reimbursement of the applicable Beneficiary for payments made by that Beneficiary following a claim for payment under an obligation insured by an FSA Policy. No later than 12:00 p.m. New York time on the business day following delivery of a notice to DCL of a reimbursement obligation due to a Beneficiary, DCL will make payment to the account specified by the Beneficiary.

In consideration for the DCL Guarantees, unless a DCL Event of Default (as defined below) or potential DCL Event of Default has occurred and is continuing, FSA Global, Premier and Cypress will be obligated to pay directly to DCL a guarantee fee in an amount equal to all insurance premiums paid by each of them after the closing date in connection with the FSA Policies (as defined below) less the portion of such premiums relating to the risks retained by FSA and less the portion of such premiums owed to reinsurers.

Indemnification Agreement —FSA, Assured and DCL have entered into an indemnification agreement (the “Indemnification Agreement”) under which:

· Assured will indemnify DCL and related parties for losses incurred after the closing date arising out of or related to the Leveraged Tax Lease Business (other than the Equity PUA Notes and the FSA insurance policies relating to the Equity PUA Notes) and the breach by FSA or certain other parties of their covenants under the Separation Agreement and related agreements; and

· DCL will indemnify FSA, Assured and related parties for losses incurred after the closing date arising out of or related to the MTN Business, the breach by DCL or certain other parties of their respective covenants, representations and warranties under the Separation Agreement and related agreements, and certain other events.

The indemnities described above are in addition to any liability which the indemnifying party may otherwise have under the Separation Agreement or otherwise and are subject to the limitations and qualifications set forth in the Indemnification Agreement.

Funding of FSA Policy Claims —Under the Separation Agreement and the DCL Guarantees, DCL has agreed to fund, on behalf of the FSA Parties, 100% of all policy claims made under the financial guaranty insurance policies issued by the FSA Parties (the “FSA Policies”) in relation to the MTN Business. Without limiting DCL’s obligation to fund 100% of all policy claims under those FSA Policies, the FSA Parties will have a separate obligation to remit to DCL a certain percentage (ranging from 0% to 25%) of those policy claims. In the event that prior to a claim under an FSA Policy, the related FSA Party determines that a loss under the FSA Policy is probable and reasonably determinable, that FSA Party may be required to establish a statutory loss reserve against such loss.

DCL Events of Default —A “DCL Event of Default” means any one of the following events:

· any failure by DCL to make a payment under a DCL Guarantee that is not cured within the applicable cure period if that uncured failure, together with the cumulative amount of previous uncured DCL Guarantee payment failures, would cause the cumulative amount of all DCL Guarantee payment failures to exceed $10,000,000;

· DCL fails to post $10,000,000 in collateral as and when required under the Separation Agreement following the eighth failure of DCL to make a timely payment under a DCL Guarantee;

· a DCL payment failure (other than a DCL guarantee payment failure) in excess of $25,000,000 that is not cured within the applicable cure period and that is not a good faith contested payment; or

· a bankruptcy event with respect to DCL.

The Strip Coverage Liquidity and Security Agreement —Under the Strip Coverage Liquidity and Security Agreement between DCL, acting through its New York Branch (“DCL (NY)”), and FSA (the “Strip Agreement”), DCL (NY) has agreed to make loans to FSA, for the purpose of financing the payment of claims under certain financial guaranty insurance policies (“Strip Policies”) that were issued by FSA, or an affiliate or subsidiary of FSA, relating to the equity strip portion of the Leveraged Tax Lease Business that FSAH is retaining. The “equity strip portion” refers to the amount by which the equity portion of the termination payment owed by the lessee to the lessor trust following the early termination of the related lease exceeds the accreted value of the Equity PUA. FSA may request advances under the Strip Agreement without any explicit limit on the number of loan requests, provided that the aggregate principal amount of loans outstanding as of any date may not exceed the Commitment Amount (as defined below) on that date. Amounts borrowed under the Strip Agreement may not be reborrowed. The loans will be secured by FSA’s recovery rights in respect of claims under the Strip Policies. No advances are currently outstanding under the Strip Agreement.

DCL (NY)’s commitment to make any loan to FSA is subject to the satisfaction by FSA of customary conditions precedent, including compliance with financial covenants, and will terminate at the earlier of (A) the occurrence of a change of control with respect to FSA, (B) the reduction of the Commitment Amount (as defined below) to $0 and (C) January 31, 2042.

The “Commitment Amount” will initially be $1,000,000,000. FSA has the right, without premium or penalty, to voluntarily reduce the Commitment Amount in whole or in part. The Commitment Amount is also subject to mandatory reduction in the amounts and on the dates described in the Strip Agreement in connection with (i) the scheduled amortization of the Commitment Amount and (ii) a reduction of the Commitment Amount if FSA fails to maintain a specified consolidated net worth.

Upon the occurrence of an Event of Default (as defined below), DCL (NY) may take any or all of the following actions: (A) terminate DCL (NY)’s commitment to make loans and (B) declare the principal of and any accrued interest in respect of all loans and the note to be due and payable. Any of the following events constitutes an “Event of Default”:

· an FSA default in the payment when due of any principal or interest of any loan or any note or any fees or any other amounts owing under the Strip Agreement or under any note, in each case in an amount of $10,000,000 or more, and any such default is not cured during the applicable cure period;

· commencement of a voluntary or involuntary bankruptcy case concerning FSA or any of its material subsidiaries;

· a default by FSA or any of its material subsidiaries in any payment in excess of $25,000,000 with respect to any indebtedness for borrowed money; or

· any indebtedness for borrowed money in excess of $25,000,000 of FSA or any of its material subsidiaries is declared to be due and payable, or required to be prepaid, prior to the stated maturity thereof.

Reference is made to the full text of the agreements described above which are filed as Exhibits 10.1 through 10. 15 to this Current Report on Form 8-K and hereby incorporated herein by reference.

Item 2.01 Completion of Acquisition or disposition of Assets

On July 1, 2009 the Company completed its acquisition of FSAH pursuant to the Purchase Agreement referred to in Item 1.01. The Company acquired 99.9264% of the common stock of FSAH pursuant to the Purchase Agreement and the remaining shares from one of FSAH’s executives as described below.

The total purchase price paid by Assured was approximately $546 million in cash and approximately 22.3 million Assured common shares. The approximately 21.8 million Assured common shares issued to Dexia Holdings represent approximately 13.8% of Assured’s outstanding common shares. Dexia has agreed that the voting rights with respect to all Assured common shares issued pursuant to the Purchase Agreement will constitute less than 9.5% of the voting power of all issued and outstanding Assured common shares. Dexia has also agreed to a certain “standstill” arrangement until the date on which it and its affiliates beneficially own Assured common shares in an amount less than 10% of the outstanding Assured common shares. In addition, Dexia has agreed that, until November 14, 2009, the first anniversary of the date of the Purchase Agreement, it will not transfer any of the Assured common shares issued pursuant to the Purchase Agreement without the consent of Assured other than to one or more of its affiliates that agrees to abide by the voting and other restrictions described above. The Acquisition excluded FSA’s financial products business, which included FSAH’s former GIC Business and MTN and Leveraged Tax Lease Businesses, as described above under Item 1.01.

The Company acquired 24,611 shares of common stock of FSAH from Robert Cochran, the former Chairman and Chief Executive Officer of FSAH, for 305,017 common shares of the Company. The Company also exchanged the deemed investment of Sean McCarthy, who became the President and Chief Operating Officer of Assured Guaranty US Holdings Inc. following the closing of the Acquisition, in 22,306 share units of FSAH under a FSAH nonqualified deferred compensation plan for a deemed investment in 130,000 share units of the Company. The Company share units will ultimately be distributed to Mr. McCarthy as a corresponding number of Assured common shares at the time he receives a distribution from such nonqualified deferred compensation plan.

As previously disclosed, in conjunction with the Purchase Agreement, the Company entered into an Amendment to Investment Agreement (the “Amendment”) dated as of November 13, 2008 with WLR Recovery Fund IV, LP, a Delaware limited partnership (the “Investor”), which amended the Investment Agreement (the “Investment Agreement”) dated as of February 28, 2008 between the Company and the Investor, which provided a back up funding commitment to finance the Acquisition. Pursuant to pre-emptive rights set forth in the Investment Agreement, the Investor and affiliated funds, which are affiliated with Wilbur Ross, who is one of the Company’s directors, purchased 3,850,000 common shares of the Company in the Company’s June 2008 public common share offering at $11.00 per common share, the public offering price in the public offering.

Further details of the terms of the Purchase Agreement and the Investment Agreement are contained in the Company’s Current Reports on Form 8-K filed on November 17, 2008 and June 12, 2009 and the agreements and amendments thereto are contained as exhibits to those filings, all of which are incorporated by reference herein.

The Company’s press release announcing the closing of the Acquisition is attached hereto as Exhibit 99.1 and incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities.

On July 1, 2009, the Company issued 21,848,934 common shares, par value $0.01 per share, to Dexia Holdings pursuant to the Purchase Agreement in exchange for 33,430,213 shares of common stock of FSAH. In the Purchase Agreement, Dexia Holdings represented to the Company that it was an “accredited investor” as defined in Rule 501 under the Securities Act and the issuance did not involve any public offering. The transaction was exempt from the registration requirements of the Securities Act by virtue of Section 4(2) thereof.

On July 1, 2009, the Company agreed to issue 305,017 common shares, par value $0.01 per share, to Robert F. Cochran, the former Chairman and Chief Executive Officer of FSAH in exchange for 24,611 shares of common stock of FSAH. This transaction did not involve any public offering and was exempt from the registration requirements of the Securities Act by virtue of Section 4(2) thereof.

Item 8.01 Other Information

As used in this Item 8.01, references to the “Company,” “Assured,” “we,” “us” and “our” refer to Assured Guaranty Ltd. and, unless the context otherwise requires or unless otherwise stated, its subsidiaries, including FSAH and its subsidiaries.

You should carefully consider the following information, together with the other information contained in the Company’s other filings with the Securities and Exchange Commission (the “SEC”). The risks and uncertainties described below are not the only ones we face. However, these are the risks our management believes are material. Additional risks not presently known to us or that we currently deem immaterial may also impair our business or results of operations. Any of the risks described below could result in a significant or material adverse effect on our results of operations or financial condition.

Risks Relating to the Acquisition and Integration of FSAH

Loss reserve estimates are subject to uncertainties and loss reserves may not be adequate to cover potential paid claims.

The financial guarantees issued by Assured and FSA insure the financial performance of the obligations guaranteed over an extended period of time, in some cases over 30 years, under policies that Assured and FSA have, in most circumstances, no right to cancel. The Acquisition has increased our net par outstanding from approximately $237.2 billion to approximately $654.5 billion as of March 31, 2009 on a combined pro-forma basis excluding FSAH’s financial products business. As a result of the lack of statistical paid loss data due to the low level of paid claims in our financial guaranty business and in the financial guaranty industry in general, particularly, until recently, in the structured asset-backed area, we do not use traditional actuarial approaches to determine loss reserves. The establishment of the appropriate level of loss reserves is an inherently subjective process involving numerous estimates, assumptions and judgments by management, using both internal and external data

sources with regard to frequency and severity of loss. Actual losses will ultimately depend on events or transaction performance that will occur in the future. Therefore, we cannot assure you that current estimates of probable and estimable losses reflect the actual losses that we may ultimately incur or that the methodologies we and FSAH use to establish reserves in general or for any specific obligations have been the same historically or that they are similar to methodologies employed by our competitors, counterparties or other market participants. Actual paid claims could exceed our estimate and could significantly exceed our loss reserves, which may result in adverse effects on our financial condition, ratings and ability to raise needed capital.

We have exposure through financial guaranty insurance policies to FSAH’s financial products business, which we did not acquire.

FSAH, through its financial products subsidiaries (the “Financial Products Companies”), offered FSA-insured GICs and other investment agreements, including medium-term notes (“MTNs”). In connection with the Acquisition, FSAH transferred to Dexia Holdings, the ownership interests in the Financial Products Companies that it held. Even though FSAH no longer owns the Financial Products Companies, FSA’s guarantees of the GICs and MTNs and other guarantees related to FSA’s MTN and Leveraged Tax Lease Businesses generally remain in place. While Dexia and/or certain of its affiliates and FSAH have entered into a number of agreements pursuant to which Dexia and certain of its affiliates have assumed the credit and liquidity risks associated with FSAH’s former financial products business, as further described under Item 1.01 above, FSA may still be subject to certain of these risks (as further described below). To the extent FSA is required to pay any amounts on financial products issued or executed by the Financial Products Companies, FSA is subject to the risk that it will not receive the guarantee payment from Dexia and/or its affiliates or that the GICs will not be paid from funds received from Dexia or the Belgian State and/or the French State before it is required to make the payment under its financial guarantee policies or that it will not receive the guarantee payment at all.

We have substantial credit and liquidity exposure to Dexia and the Belgian and French states.

As further described under Item 1.01 above, Dexia and its affiliates have entered into a number of agreements pursuant to which Dexia and/or certain of its affiliates have agreed to guarantee certain amounts, lend certain amounts or post liquid collateral to or in respect of FSAH’s former financial products business. In addition, as further described under Item 1.01 above, Dexia has agreed (directly or through an affiliate) to provide a liquidity facility to FSA in an amount not to exceed $1 billion for the purpose of covering the liquidity risk arising out of claims payable in respect of “strip coverages” included in FSAH’s Leveraged Tax Lease Business. While these various agreements, are intended to shield Assured from paying any amounts in respect of the liabilities of the financial products business, Assured remains subject to the risk that Dexia and/or various affiliates, and even the Belgian State and/or the French State, may not make such amounts or securities available (a) on a timely basis, which is referred to as “liquidity risk,” or (b) at all, which is referred to as “credit risk,” because of the risk of default. Even if Dexia and its affiliates and/or the Belgian State or French State have sufficient assets to pay all amounts when due, concerns regarding Dexia’s or such States’ financial condition could cause one or more rating agencies to view negatively the ability of Dexia and its affiliates or such States to perform under their various agreements and could negatively affect FSA’s ratings.

Dexia and FSAH have entered into a number of agreements pursuant to which Dexia and/or certain of its affiliates have agreed to guarantee the assets and liabilities of the GIC Issuers and FSAM and its subsidiary for the benefit of FSA. Certain of these obligations also benefit from a guarantee from the Belgian and French States. As of March 31, 2009, the liabilities of the GIC Issuers and FSAM and its subsidiary exceeded their assets by approximately $8.7 billion (before any tax effects). To the extent FSA is

required to pay any amounts in respect of the liabilities of these companies, FSA is subject to the risk that it will not receive the guarantee payment from Dexia and/or its affiliates or that the GICs will not be paid from funds received from Dexia or the Belgian State and/or the French State before it is required to make the payment under its financial guarantee policies or that it will not receive the guarantee payment at all.

In addition, if a Dexia event of default were to occur, we may be required to direct the administration and management of the assets and liabilities of the GIC subsidiaries and could be delayed in our ability to cause the GIC subsidiaries to utilize the collateral posted by Dexia and its affiliate under the credit support annexes. Any delay in the GIC subsidiaries paying amounts due and payable in connection with the GIC business related to our assuming the obligation to direct the administration and management of the GIC subsidiaries’ assets and liabilities or related to a delay in our access to the collateral posted by Dexia and its affiliate could require FSA to pay claims, and in some cases significant claims, under the FSA guarantees related to FSAH’s Financial Products business in a relatively short period of time. Any failure of FSA to satisfy these obligations under its guarantees could negatively affect FSA’s rating. See “—A downgrade of the financial strength or financial enhancement ratings of FSA could adversely affect its business and prospects and, consequently, its results of operations and financial condition and thus the benefits we would otherwise gain from the Acquisition” below.

Restrictions on the conduct of FSA’s business after the closing will limit Assured’s operating and financial flexibility.

Under the Purchase Agreement, we have agreed to conduct FSA’s business subject to certain restraints. These restrictions will generally continue for three years after the closing of the Acquisition. Among other things, we have agreed that unless FSA is rated below A1 by Moody’s and below AA- by S&P, FSA will not write any business except municipal bond and infrastructure bond insurance, whether written directly, assumed, reinsured or occurring through any merger transaction. We have also agreed that FSA will not repurchase, redeem or pay any dividends in relation to any class of equity interests unless (i) (A) at such time FSA is rated at least AA- by S&P, AA- by Fitch and Aa3 by Moody’s (if such rating agencies still rate financial guaranty insurers generally) and (B) the aggregate amount of such dividends in any year does not exceed 125% of FSAH’s debt service requirements for that year or (ii) FSA receives prior rating agency confirmation that such action would not cause any rating currently assigned to FSA to be downgraded immediately following such action. These agreements will limit Assured’s operating and financial flexibility.

Although we expect that the Acquisition will result in benefits to Assured, we may not realize those benefits because of integration difficulties.

Integrating the operations of Assured and FSAH successfully or otherwise realizing any of the anticipated benefits of the Acquisition, including anticipated cost savings and additional revenue opportunities, involve a number of potential challenges. The failure to meet these integration challenges could seriously harm our results of operations and the market price of the Assured common shares may decline as a result.

Realizing the benefits of the Acquisition will depend in part on the integration of information technology systems, operations and personnel. These integration activities are complex and time-consuming and we may encounter unexpected difficulties or incur unexpected costs, including:

· diversion of management attention from ongoing business concerns to integration matters;

· difficulties in consolidating and rationalizing information technology platforms and administrative infrastructures; and

· difficulties in combining corporate cultures, maintaining employee morale and retaining key employees.

We may not successfully integrate the operations of Assured and FSAH in a timely manner and we may not realize the anticipated net reductions in costs and expenses and other benefits and synergies of the Acquisition to the extent, or in the time frame, anticipated. In addition to the integration risks discussed above, our ability to realize these net reductions in costs and expenses and other benefits and synergies could be adversely impacted by practical or legal constraints on our ability to combine operations.

Subject to certain limitations, Dexia Holdings may sell Assured common shares at any time following the one year anniversary of the Purchase Agreement, which could cause our stock price to decrease.

Dexia Holdings has agreed not to transfer any of the approximately 21.8 million Assured common shares received in connection with the Acquisition at any time prior to November 14, 2009, the one year anniversary of the Purchase Agreement. We have agreed to register all of such Assured common shares under the Securities Act of 1933, as amended (the “Securities Act”). The sale of a substantial number of Assured common shares by Dexia Holdings or our other stockholders within a short period of time could cause Assured’s stock price to decrease, making it more difficult for us to raise funds through future offerings of Assured common shares or acquire other businesses using Assured common shares as consideration.

A downgrade of the financial strength or financial enhancement ratings of FSA would adversely affect its business and prospects and, consequently, its results of operations and financial condition and thus the benefits we would otherwise gain from the Acquisition.

As discussed below under “— A downgrade of the financial strength or financial enhancement ratings of any of our insurance subsidiaries would adversely affect our business and prospects and, consequently, our results of operations and financial condition, ” financial strength ratings are an important factor in establishing the competitive position of financial guaranty insurance and reinsurance companies.

As of July 1, 2009, FSA was rated AAA (negative outlook) by S&P; AA+ (rating watch negative) by Fitch and Aa3 (on review for possible downgrade) by Moody’s.

Rating agencies may downgrade or revise their financial strength or financial enhancement ratings without notice and at any time. A downgrade of FSA’s financial strength or financial enhancement ratings would adversely affect its business prospects and consequently, its results of operations and financial condition and thus the benefits we would otherwise gain from the Acquisition.

Risks Related to Our Business

Loss reserve estimates are subject to uncertainties and loss reserves may not be adequate to cover potential paid claims.

The financial guaranties issued by us insure the credit performance of the obligations guaranteed over an extended period of time, in some cases over 30 years, under policies that we have,

in most circumstances, no right to cancel. As a result of the lack of statistically significant paid loss data due to the low level of paid claims in our financial guaranty business and in the financial guaranty industry in general, particularly, until recently, in the structured finance and asset-backed areas, we do not use traditional actuarial approaches to determine loss reserves. The establishment of the appropriate level of loss reserves is an inherently subjective process involving numerous estimates, assumptions and judgments by management, using both internal and external data sources with regard to frequency and severity of loss. Actual losses will ultimately depend on events or transaction performance that will occur in the future. Therefore, there can be no assurance that actual paid claims in our insured portfolio will not exceed our loss reserves or that the methodologies we and FSA use to establish reserves in general or for any specific obligations have been the same historically or that they are similar to methodologies employed by our competitors, counterparties or other market participants.

This uncertainty has substantially increased in recent months, especially for RMBS transactions. Current expected losses in subprime, Alt-A, closed-end second and home equity line of credit (“HELOC”) RMBS transactions, as well as other real-estate related transactions, are far worse than originally expected and in many cases far worse than the worst historical losses. As a result, historical loss data may have limited value in predicting future RMBS losses. Our net par outstanding as of March 31, 2009 represented by U.S. RMBS and home equity loans was $17.8 billion and represented by commercial mortgage-backed securities (“CMBS”) was $5.9 billion. FSA had net par outstanding as of March 31, 2009 represented by U.S. RMBS and home equity loans of $16.5 billion with no CMBS exposure. We cannot assure you that current estimates of probable and estimable losses reflect the actual losses that we may ultimately incur. Actual paid claims could exceed our estimate and could significantly exceed our loss reserves, which may result in adverse effects on our financial condition, ratings and ability to raise needed capital.

A downgrade of the financial strength or financial enhancement ratings of any of our insurance subsidiaries would adversely affect our business and prospects and, consequently, our results of operations and financial condition.

Financial strength ratings are an important factor in establishing the competitive position of financial guaranty insurance and reinsurance companies. The objective of these ratings is to provide an opinion of an insurer’s financial strength and ability to meet ongoing obligations to its policyholders. Ratings reflect the rating agencies’ opinions of our financial strength, and are neither evaluations directed to investors in our common shares nor recommendations to buy, sell or hold our common shares.

As of July 1, 2009, our insurance company subsidiaries (other than FSA which is discussed above) have been assigned the following insurance financial strength ratings:

	Moody’s	S&P	Fitch
Assured Guaranty Corp.	Aa2(Excellent)	AAA(Extremely Strong)	AA(Very Strong)
Assured Guaranty Re Ltd.	Aa3(Excellent)	AA(Very Strong)	AA-(Very Strong)
Assured Guaranty Re Overseas Ltd.	Aa3(Excellent)	AA(Very Strong)	AA-(Very Strong)
Assured Guaranty Mortgage Insurance Company	Aa3(Excellent)	AA(Very Strong)	AA-(Very Strong)
Assured Guaranty (UK) Ltd.	Aa2(Excellent)	AAA(Extremely Strong)	AA(Very Strong)

The outlook for each insurance financial strength rating issued by Moody’s is under review for possible downgrade. The outlook for each insurance financial strength rating issued by Fitch is rating watch evolving. On July 1, 2009, S&P revised its outlook on Assured Guaranty Corp. and Assured Guaranty (UK) Ltd. (“AG UK”) to negative from stable.

Aa2 (Excellent) is the third highest ranking and Aa3 (Excellent) is the fourth highest ranking of 21 ratings categories used by Moody’s. A AAA (Extremely Strong) rating is the highest ranking and AA (Very Strong) is the third highest ranking of the 21 ratings categories used by S&P. AAA

(Extremely Strong) is the highest ranking and AA (Very Strong) is the third highest ranking of the 24 ratings categories used by Fitch. An insurance financial strength rating is an opinion with respect to an insurer’s ability to pay under its insurance policies and contracts in accordance with their terms. The opinion is not specific to any particular policy or contract. Insurance financial strength ratings do not refer to an insurer’s ability to meet non-insurance obligations and are not a recommendation to purchase or discontinue any policy or contract issued by an insurer or to buy, hold, or sell any security issued by an insurer.

The major rating agencies have developed and published rating guidelines for rating financial guaranty and mortgage guaranty insurers and reinsurers. The insurance financial strength ratings assigned by S&P, Moody’s and Fitch are based upon factors relevant to policyholders and are not directed toward the protection of investors in our common shares. The rating criteria used by the rating agencies in establishing these ratings include consideration of the sufficiency of capital resources to meet projected growth (as well as access to such additional capital as may be necessary to continue to meet applicable capital adequacy standards), the company’s overall financial strength, and demonstrated management expertise in financial guaranty and traditional reinsurance, credit analysis, systems development, marketing, capital markets and investment operations. Obligations insured by Assured Guaranty Corp. (“AGC”) generally are rated Aa2, AAA and AA by Moody’s, S&P and Fitch, respectively, by virtue of such insurance. These ratings reflect only the views of the respective rating agencies and are subject to revision or withdrawal at any time.

The rating agencies grant credit to primary companies in their calculations of required capital and single risk limits for reinsurance ceded. The amount of credit is a function of the financial strength rating of the reinsurer. For example, S&P has established the following reinsurance credit for business ceded to a monoline reinsurer, including Assured Guaranty Re Ltd. (“AG Re”):

	Monoline Reinsurer Rating
Ceding Company Rating	AAA		AA		A		BBB
AAA	100	%	70	%	50	%	n/a
AA	100	%	75	%	70	%	50	%
A	100	%	80	%	75	%	70	%

Below A: Not applicable.

For reinsurance ceded to a multiline reinsurer, S&P has re-examined its methodology for the determination of reinsurance credit. In the course of its examination, S&P considered the effect of having both monoline and multiline companies in the industry, determining that multiline reinsurers had not demonstrated sufficient commitment to participation in the industry and occasionally had handled claims for financial guaranty reinsurance as they handle claims in their other business lines. S&P therefore determined that no rating agency reinsurance credit would be accorded cessions to multiline reinsurance companies that had not demonstrated their willingness and ability to make timely payment, which willingness and ability is measured by a financial enhancement rating from S&P. A financial enhancement rating reflects not only an insurer’s perceived ability to pay claims, but also its perceived willingness to pay claims. Financial enhancement ratings are assigned by S&P to multiline insurers requesting the rating who meet stringent criteria identifying the company’s capacity and

willingness to pay claims on a timely basis. S&P has established the following reinsurance credit for business ceded to a multiline reinsurer carrying a financial enhancement rating:

	Multiline Reinsurer Rating
Ceding Company Rating	AAA		AA		A		BBB
AAA	95	%	65	%	45	%	n/a
AA	95	%	70	%	65	%	45	%
A	95	%	75	%	70	%	65	%

Below A: Not applicable.

The ratings of Assured Guaranty Re Overseas Ltd. (“AGRO”), Assured Guaranty Mortgage Insurance Company (“AGMIC”) and Assured Guaranty (UK) Ltd. (“AG UK”) are dependent upon support in the form of keepwell agreements. AG Re provides a keepwell to its subsidiary, AGRO. AGRO provides a keepwell to its subsidiary, AGMIC. AGC provides a keepwell to its subsidiary, AG UK. Pursuant to the terms of these agreements, each of AG Re, AGRO and AGC agrees to provide funds to their respective subsidiaries sufficient for those subsidiaries to meet their obligations.

The ratings assigned by S&P, Moody’s and Fitch to our insurance subsidiaries are subject to periodic review and may be downgraded by one or more of the rating agencies as a result of changes in the views of the rating agencies or adverse developments in our subsidiaries’ financial conditions or results of operations due to underwriting or investment losses or other factors. As a result, the ratings assigned to our insurance subsidiaries by any of the rating agencies may change at any time. If the ratings of any of our insurance subsidiaries were reduced below current levels by any of the rating agencies, it could have an adverse effect on the affected subsidiary’s competitive position and its prospects for future business opportunities. A downgrade may also reduce the value of the reinsurance we offer, which may no longer be of sufficient economic value for our customers to continue to cede to our subsidiaries at economically viable rates.

On July 1, 2009, S&P published a Research Update in which it affirmed its “AAA” counterparty credit and financial strength ratings on Assured Guaranty Corp. At the same time, S&P revised its outlook on Assured Guaranty Corp. and AG UK to negative from stable.

On May 20, 2009, Moody’s placed under review for possible downgrade the Aa2 insurance financial strength rating of AGC, as well as the ratings of other entities within the Assured group. In its public announcement of the rating action, Moody’s stated that action reflects its view that despite recent improvements in Assured’s market position, the expected performance of Assured’s insured portfolio—particularly the mortgage-related risks—has substantially worsened. At the same time, Moody’s also placed the Aa3 insurance financial strength ratings of FSA and its affiliated insurance operating companies on review for possible downgrade. In its public announcement of the rating action, Moody’s cited its growing concerns about FSA’s business and financial profile as a result of further deterioration in FSA’s US mortgage portfolio and the related adverse effect on its capital adequacy, profitability, and market traction. In both press releases, Moody’s noted that it has taken a more negative view of mortgage-related exposures in light of worse-than-expected performance trends, and recognized the continued susceptibility of the insured portfolio to the weak economic environment. Moody’s also commented that the deterioration in the insured portfolios could have negative implications for the companies’ franchise values, profitability and financial flexibility given the likely sensitivity of those business attributes to its capital position. Moody’s also noted that the market dislocation caused by declining financial strength of financial guaranty insurers may alter the competitive dynamics of the industry by encouraging the entry of new participants or the growth of alternative forms of execution.

On May 4, 2009, Fitch downgraded the debt and insurer financial strength ratings of Assured Guaranty Ltd. and its subsidiaries. Fitch’s insurer financial strength ratings for AGC and AG UK are now AA (rating watch evolving), down from AAA (stable) while the insurer financial strength ratings for AG Re is AA- (rating watch evolving), down from AA (stable). Fitch cited Assured’s exposures to mortgage-related and collateralized debt obligations of trust preferred securities as creating pressure on Assured’s capital position. On May 11, 2009, Fitch lowered the rating of FSA to AA+ (negative credit watch). Fitch reported that the downgrade of FSA to AA+ was attributable to FSA’s credit exposure to

the AA+ rating of the Kingdom of Belgium in connection with the separation of the Financial Products operations from FSA.

The rating agencies periodically review their stress loss estimates for our portfolio. Their reviews could lead one or more of them to change their views of Assured and its subsidiaries and downgrade or revise the financial strength or financial enhancement ratings of Assured and its subsidiaries without notice and at any time. There can be no assurance that one or more of the rating agencies will not take further action on our ratings.

If the financial strength or financial enhancement ratings of any of our insurance subsidiaries were reduced below current levels, we expect it would have an adverse effect on our business prospects for future business opportunities and consequently, our results of operations and financial condition. A downgrade may also reduce the value of the reinsurance we offer, which may no longer be of sufficient economic value for our customers to continue to cede to our subsidiaries at economically viable rates.

A downgrade in the financial strength or financial enhancement ratings assigned to our operating subsidiaries could adversely impact our existing agreements, which could impair our results of operations and financial condition.

With respect to a significant portion of our in-force financial guaranty reinsurance business, in the event that AG Re were downgraded from Aa3 to A1, subject to the terms of each reinsurance agreement, the ceding company may have the right to recapture business ceded to AG Re and assets representing substantially all of the statutory unearned premium and loss reserves (if any) associated with that business. As of March 31, 2009, the statutory unearned premium, which represents deferred revenue to us, subject to recapture was approximately $170 million. If this entire amount were recaptured, it would result in a corresponding one-time reduction to net income of approximately $15 million. The effect on net income under these scenarios is exclusive of any capital gains or losses that may be realized.

If certain of our credit derivative contracts are terminated, we could be required to make a termination payment as determined under the relevant documentation. As of June 24, 2009, if AGC’s ratings are downgraded to BBB+ or Baa1, certain Credit Default Swap (“CDS”) counterparties could terminate certain CDS contracts covering approximately $449.6 million par insured. If AGC’s ratings are downgraded to levels between BBB or Baa2 and BB+ or Ba1, certain CDS counterparties could terminate certain CDS contracts covering approximately $8.1 billion par insured. As of June 24, 2009, if AG Re’s or AGRO’s ratings are downgraded to BBB or Baa2 or BBB- or Baa3, respectively, certain CDS counterparties could terminate certain CDS contracts covering approximately $121.7 million par insured. Given current market conditions, we do not believe that we can accurately estimate the termination payments we could be required to make if, as a result of any such downgrade, a CDS counterparty terminated its CDS contracts with us. Any such payments could have a material adverse effect on our liquidity and financial condition.

During May and June 2009, we entered into agreements with two CDS counterparties which previously had the right to terminate certain CDS contracts in the event that AGC was downgraded to below Aa3 or AA-, in one case, or below A3 or A-, in the other case. These agreements eliminated the ability of those CDS counterparties to receive a termination payment. In return, we agreed to post $325 million in collateral to secure our potential payment obligations under certain CDS contracts, which cover approximately $18.9 billion of par insured. The collateral posting would increase to $375 million if AGC were downgraded to below AA- or A2. The posting of this collateral has no impact on our net income or shareholders’ equity nor does it impact AGC’s statutory surplus or net income. We currently are negotiating with several other CDS counterparties to further reduce our exposure to possible termination payments. We cannot assure you that any agreement will be reached with any such CDS counterparty.

In addition to the collateral posting described in the previous paragraph, under a limited number of other CDS contracts, we may be required to post eligible securities as collateral—generally cash or U.S. government or agency securities. This requirement is based generally on a mark-to-market valuation in excess of contractual thresholds which decline if our ratings decline. As of June 24, 2009, we are posting approximately $192.5 million of collateral in respect of approximately $1.6 billion of par insured. Any amounts required to be posted as collateral in the future will depend on changes in the market values of these transactions. If AGC were downgraded below A- or A3, certain of the contractual thresholds would be eliminated and the amount of par that could be subject to collateral posting requirements would be $2.2 billion. The actual amounts posted would be based on market conditions at the time of the posting and the applicable CDS contracts. Any such amounts posted could have a material adverse effect on our liquidity.

Actions taken by the rating agencies with respect to capital models and rating methodology of our business or transactions within our insured portfolio may adversely affect our business, results of operations and financial condition.

Changes in the rating agencies’ capital models and rating methodology, including loss assumptions, and the risks in our investment and insured portfolios could require us to hold more capital to maintain our current ratings levels. These changes in methodology or assumptions could require us to hold more capital even if there are no adverse developments with respect any specific investments or insured risks. The rating agencies have recently indicated that they are considering changes to the loss assumptions applied in the stress tests they apply to the portfolios of financial guarantors. These loss assumptions are not always provided to us by the rating agencies and, even if they are provided to us, we may disagree with the rating agency loss assumptions. There can be no assurance that the amount of additional required capital will not be substantial or that such capital will be available to us on favorable terms and conditions or at all. The failure to raise additional required capital could result in a downgrade of our ratings, which could be one or more ratings categories, and thus have an adverse impact on our business, results of operations and financial condition.

Individual credits in our insured portfolio (including potential new credits) are assessed a rating agency “capital charge” based on a variety of factors, including the nature of the credits, their underlying ratings, their tenor and their expected and actual performance. Factors influencing rating agencies’ actions are beyond management’s control and are not always known to us. In the event of an actual or perceived deterioration in creditworthiness, a reduction in the underlying rating or a change in the rating agency capital methodology, the rating agencies may require us to increase the amount of capital allocated to support the affected credits, regardless of whether losses actually occur, or against potential new business. Significant reductions in underlying ratings of credits in our insured portfolio can produce significant increases in assessed “capital charges”, which may require us to seek additional capital. There can be no assurance that our capital position will be adequate to meet such increased reserve requirements or that we will be able to secure additional capital, especially at a time of actual or perceived deterioration in creditworthiness of new or existing credits. Unless we are able to increase its amount of available capital, an increase in capital charges could reduce the amount of capital available to support our ratings and could have an adverse effect on our ability to write new business.

In recent months Fitch, Moody’s and S&P have announced the downgrade of, or other negative ratings actions with respect to, a large number of structured finance transactions, including certain transactions that we insure. There can be no assurance that additional securities in our insured portfolio will not be reviewed and downgraded in the future. Moreover, we do not know what portion of the securities in our insured portfolio already have been reviewed by the rating agencies and if, and when, the rating agencies might review additional securities in our insured portfolio or review again securities that have already been reviewed and/or downgraded. Downgrades of credits that we insure will result in higher capital charges to us under the relevant rating agency model or models. If the additional amount of capital required to support such exposures is significant, we could be required to

raise additional capital, if available, on terms and conditions that may not be favorable to us, curtail current business writings, or pay to transfer a portion of our in-force business to generate capital for ratings purposes with the goal of maintaining our ratings or suffer ratings downgrades. Such events or actions could adversely affect our results of operations, financial condition, ability to write new business or competitive positioning.

If the current difficult conditions in the U.S. and world-wide financial markets continue for an extended period or intensify, our business, liquidity, financial condition and stock price may be adversely affected.

The volatility and disruption in the global financial markets have reached unprecedented levels. The availability and cost of credit has been materially affected. These factors, combined with volatile oil prices, depressed home prices and increasing foreclosures, falling equity market values, declining business and consumer confidence and the risks of increased inflation and unemployment, have precipitated an economic slowdown and fears of a severe recession. These conditions may adversely affect our profitability, financial position, investment portfolio, cash flow, statutory capital and stock price.

Issuers or borrowers whose securities or loans we hold and counterparties under swaps and other derivative contracts may default on their obligations to us due to bankruptcy, insolvency, lack of liquidity, adverse economic conditions, operational failure, fraud or other reasons. Additionally, the underlying assets supporting our structured securities may deteriorate, causing these securities to incur losses. These losses could be significantly more than we expect and could materially adversely impact our financial strength, ratings and prospects for future business.

Our access to funds under our credit facilities is dependent on the ability of the banks that are parties to the facilities to meet their funding commitments. Those banks may not be able to meet their funding commitments to us if they experience shortages of capital and liquidity or if they experience excessive volumes of borrowing requests from us and other borrowers within a short period of time. In addition, consolidation of financial institutions could lead to an increased credit risk.

Some of the state and local governments that issue obligations we insure are experiencing unprecedented budget shortfalls that could result in increased credit losses or impairments on those obligations.

In recent months state and local governments that issue some of the obligations we insure have reported unprecedented budget shortfalls that will require them to significantly raise taxes and/or cut spending in order to satisfy their obligations. While there have been some proposals by the U.S. federal government designed to provide aid to state and local governments, there can be no assurance that any of these proposals will be adopted. If the issuers of the obligations in our public finance portfolio are unable to raise taxes, increase spending, or receive federal assistance, we may experience losses or impairments on those obligations, which would materially and adversely affect our business, financial condition and results of operations.

We may require additional capital in the future, including soft capital and liquidity credit facilities, which may not be available or may be available only on unfavorable terms.

Our capital requirements depend on many factors, including our in force book of business and rating agency capital requirements. To the extent that our existing capital is insufficient to meet these requirements and/or cover losses, we may need to raise additional funds through financings or curtail our growth and reduce our assets. Our access to external sources of financing, as well as the cost of such financing, is dependent on various factors, including market supply of such financing, our long term debt ratings and the insurance financial strength ratings and the perceptions of our financial strength and the financial strength of our insurance subsidiaries. Our debt ratings are influenced by

numerous factors, either in absolute terms or relative to our peer group, such as financial leverage, balance sheet strength, capital structure and earnings trends. The current adverse conditions in the credit markets have generally restricted the supply of external sources of financing and increased the cost of such financing when it is available. Equity financings could result in dilution to our shareholders and the securities may have rights, preferences and privileges that are senior to those of our common shares. If our need for capital arises because of significant losses, the occurrence of these losses may make it more difficult for us to raise the necessary capital.

Financial guaranty insurers and reinsurers typically rely on providers of lines of credit, credit swap facilities and similar capital support mechanisms (often referred to as “soft capital”) to supplement their “hard capital.” The ratings of soft capital providers directly affect the level of capital credit which the rating agencies attribute to the financial guaranty insurer or reinsurer when rating its financial strength. We intend to maintain soft capital facilities with providers having ratings adequate to provide the desired capital credit, although no assurance can be given that one or more of the rating agencies will not downgrade or withdraw the applicable ratings of such providers in the future. In addition, we cannot assure you that an acceptable replacement provider would be available in that event.

We require liquidity in order to pay our operating expenses, interest on our debt and dividends on our common shares, and to make capital investments in our operating subsidiaries. We anticipate that our need for liquidity will be met by (1) the ability of our operating subsidiaries to pay dividends or to make other payments to us, (2) external financings and (3) investment income from our invested assets. Our principal subsidiaries are subject to legal and rating agency restrictions on their ability to pay dividends and make other permitted payments, and external financing may or may not be available to us in the future on satisfactory terms. Our other subsidiaries are subject to legal restrictions on their ability to pay dividends and distributions. In connection with the Acquisition, we have committed that FSA will not pay any dividends for a period of two years from the date of the Acquisition without the written approval of the New York Insurance Department (the “Department”). While we believe that we will have sufficient liquidity to satisfy our needs over the next 12 months, there can be no assurance that adverse market conditions, changes in insurance regulatory law or changes in general economic condition that adversely affect our liquidity will not occur. Similarly, there can be no assurance that adequate liquidity will be available to us on favorable terms in the future.

Liquidity at our operating subsidiaries is used to pay operating expenses, claims, payment obligations with respect to credit derivatives, reinsurance premiums and dividends to Assured Guaranty US Holdings Inc. for debt service and dividends to us, as well as, where appropriate, to make capital investments in their own subsidiaries. While we believe that the operating cash flows of our subsidiaries will be sufficient to meet their needs, we cannot assure you that this will be the case, nor can we assure you that existing liquidity facilities will prove adequate to their needs, or be available to them on favorable terms in the future.

An increase in our subsidiaries’ risk-to-capital ratio or leverage ratio may prevent them from writing new insurance.

Rating agencies and insurance regulatory authorities impose capital requirements on our insurance subsidiaries. These capital requirements, which include risk-to-capital ratios, leverage ratios and surplus requirements, limit the amount of insurance that our subsidiaries may write. Our insurance subsidiaries have several alternatives available to control their risk-to-capital ratios and leverage ratios, including obtaining capital contributions from us, purchasing reinsurance or entering into other loss mitigation agreements, or reducing the amount of new business written. However, a material reduction in the statutory capital and surplus of a subsidiary, whether resulting from underwriting or investment losses or otherwise, or a disproportionate increase in the amount of risk in force, could increase a subsidiary’s risk-to-capital ratio or leverage ratio. This in turn could require that subsidiary to obtain reinsurance for existing business (which may not be available, or may be available on terms that we

consider unfavorable), or add to its capital base to maintain its financial strength ratings. Failure to maintain such ratings could limit that subsidiary’s ability to write new business.

Our reinsurance business is primarily dependent on facultative cessions and portfolio opportunities which may not be available to us in the future.

In prior years we have derived a substantial portion of our revenues from financial guaranty reinsurance premiums. During 2009 and the second half of 2008, there was a substantial reduction of direct financial guaranty business underwritten by our principal ceding companies and a reduction in the amount of reinsurance they utilize. As a result, reinsurance treaty and facultative cessions of new business have ceased and we are seeking opportunities to assume financial guaranty portfolios. These portfolio opportunities may not be available to us, which would have an adverse effect on our reinsurance business.

Recent adverse developments in the credit and financial guaranty markets have substantially increased uncertainty in our business and may materially and adversely affect our financial condition, results of operations and future business.

Since mid-2007 there have been adverse developments in the credit and financial guaranty markets. U.S. RMBS transactions issued in recent years are now expected to absorb losses far higher than originally expected by purchasers of these securities and financial guarantors which guaranteed such securities. This poor performance has led to price declines for RMBS securities and the rating agencies downgrading thousands of such transactions. The recent credit crisis has substantially reduced the demand for our structured finance guaranties. These market conditions may also adversely affect us in a number of ways, including requiring us to raise and hold more capital, reduce the demand for our direct guaranties or reinsurance, limit the types of guaranties we offer, encourage new competitors, make losses harder to estimate, make our results more volatile and make it harder to raise new capital.

Our financial guaranty products may subject us to significant risks from individual or correlated credits.

We could be exposed to corporate credit risk if the credit’s securities are contained in a portfolio of collateralized debt obligations we insure, or if it is the originator or servicer of loans or other assets backing structured securities that we have insured. A Collateralized Debt Obligation (“CDO”) is a debt security backed by a pool of debt obligations. While we track our aggregate exposure to single names in our various lines of business and have established underwriting criteria to manage risk aggregations, there can be no assurance that our ultimate exposure to a single name will not exceed our underwriting guidelines, or that an event with respect to a single name will not cause a significant loss. In addition, because we insure or reinsure municipal bonds, we can have significant exposures to single municipal risks. While the risk of a complete loss, where we pay the entire principal amount of an issue of bonds and interest thereon with no recovery, is generally lower than for corporate credits as most municipal bonds are backed by tax or other revenues, there can be no assurance that a single default by a municipality would not have a material adverse effect on our results of operations or financial condition.

We are exposed to correlation risk across the various assets we insure. During strong periods of macro economic performance, stress in an individual transaction generally occurs in a single asset class or for idiosyncratic reason. During a broad economic downturn, a broader range of our insured portfolio could be exposed to stress at the same time. This stress may manifest itself in downgrades, which may require more capital, or in actual losses.

Some of our direct financial guaranty products may be riskier than traditional financial guaranty insurance.

A substantial portion of our financial guaranty direct exposures have been assumed as credit derivatives. Traditional financial guaranty insurance provides an unconditional and irrevocable guaranty that protects the holder of a municipal finance or structured finance obligation against non payment of principal and interest, while credit derivatives provide protection from the occurrence of specified credit events, including non payment of principal and interest. In general, we structure credit derivative transactions such that circumstances giving rise to our obligation to make payments is similar to that for financial guaranty policies and generally occurs as losses are realized on the underlying reference obligation. Nonetheless, credit derivative transactions are governed by ISDA documentation and operate differently from financial guaranty insurance policies. For example, our control rights with respect to a reference obligation under a credit derivative may be more limited than when we issue a financial guaranty insurance policy on a direct primary basis. In addition, while our exposure under credit derivatives, like our exposure under financial guaranty insurance policies, has been generally for as long as the reference obligation remains outstanding, unlike financial guaranty insurance policies, a credit derivative may be terminated for a breach of the ISDA documentation or other specific events. In some older credit derivative transactions, one such specified event is the failure of AGC to maintain specified financial strength ratings. If a credit derivative is terminated, we could be required to make a mark-to-market payment as determined under the ISDA documentation.

In addition, under a limited number of credit derivative contracts, we are required to post eligible securities as collateral, generally cash or U.S. government or agency securities. The need to post collateral under these transactions is generally based on mark-to-market valuation in excess of contractual thresholds. The particular thresholds decline if our ratings decline.

See “— A downgrade of the financial strength or financial enhancement ratings of any of our insurance subsidiaries would adversely affect our business and prospects and, consequently, our results of operations and financial condition.”

Competition in our industry may adversely affect our revenues.

The principal sources of direct and indirect competition are other financial guaranty insurance companies and other forms of credit enhancement, which include structural enhancement, letters of credit, and credit derivatives provided by foreign and domestic banks and other financial institutions, some of which are governmental enterprises.

Our financial guaranty reinsurance business is vulnerable to a decline in demand by other financial guaranty insurance companies, as evidenced over the last few years.

New entrants into the financial guaranty industry could have an adverse effect on our prospects either by furthering price competition or by reducing the aggregate demand for our reinsurance as a result of additional insurance capacity.

Recently a new financial guaranty insurer has been licensed to operate in New York and the New York State Insurance Superintendent is encouraging other insurance regulators to rapidly license this new financial guaranty insurer. There have been news reports of other efforts to form new financial guarantors. Increased competition, either in terms of price, alternative structures, or the emergence of new providers of credit enhancement, could have an adverse effect on our business.

We are dependent on key executives and the loss of any of these executives, or our inability to retain other key personnel, could adversely affect our business.

Our success substantially depends upon our ability to attract and retain qualified employees and upon the ability of our senior management and other key employees to implement our business strategy. We believe there are only a limited number of available qualified executives in the business lines in which we compete. Although we are not aware of any planned departures, we rely substantially upon the services of Dominic J. Frederico, our President and Chief Executive Officer, and other executives. Although Mr. Frederico and certain other executives have employment agreements with us, we cannot assure you that we will be able to retain their services. The loss of the services of any of these individuals or other key members of our management team could adversely affect the implementation of our business strategy.

Our business could be adversely affected by Bermuda employment restrictions.

Our location in Bermuda may serve as an impediment to attracting and retaining experienced personnel. Under Bermuda law, non Bermudians, other than spouses of Bermudians and individuals holding permanent resident certificates or working resident certificates, are not permitted to engage in any gainful occupation in Bermuda without a work permit issued by the Bermuda government. A work permit is only granted or extended if the employer can show that, after a proper public advertisement, no Bermudian, spouse of a Bermudian or individual holding a permanent resident certificate or working resident certificates is available who meets the minimum standards for the position. The Bermuda government’s policy places a six year term limit on individuals with work permits, subject to specified exemptions for persons deemed to be key employees. All of our Bermuda based employees who require work permits have been granted permits by the Bermuda government, including our President and Chief Executive Officer, Chief Financial Officer, General Counsel and Secretary, Chief Accounting Officer, Chief Credit Officer, Chief Surveillance Officer and President of AG Re. It is possible that we could lose the services of one or more of our key employees if we are unable to obtain or renew their work permits.

We may be adversely affected by interest rate changes affecting the performance of our investment portfolio.

Our operating results are affected, in part, by the performance of our investment portfolio. Changes in interest rates could also have an adverse effect on our investment income. For example, if interest rates decline, funds reinvested will earn less than expected. Our investment portfolio contains interest rate-sensitive instruments, such as bonds, which may be adversely affected by changes in interest rates. Increases in interest rates will reduce the value of these securities, resulting in unrealized losses that we are required to include in shareholder’s equity as a change in accumulated other comprehensive income. Accordingly, interest rate increases could reduce our shareholders’ equity.

In addition, our investment portfolio includes mortgage-backed securities. As of March 31, 2009, mortgage-backed securities constituted approximately 28% of our invested assets. As with other fixed maturity investments, the fair market value of these securities fluctuates depending on market and other general economic conditions and the interest rate environment. Changes in interest rates can expose us to significant prepayment risks on these investments. In periods of declining interest rates, mortgage prepayments generally increase and mortgage-backed securities are prepaid more quickly, requiring us to reinvest the proceeds at then-current market rates. During periods of rising interest rates, the frequency of prepayments generally decreases. Mortgage-backed securities having an amortized value less than par (i.e., purchased at a discount) may incur a decrease in yield or a loss as a result of slower prepayment.

Interest rates are highly sensitive to many factors, including monetary policies, domestic and international economic and political conditions and other factors beyond our control. We do not engage in active management, or hedging, of interest rate risk, and may not be able to mitigate interest rate sensitivity effectively.

The performance of our invested assets affects our results of operations and cash flows.

Income from our investment portfolio is one of the primary sources of cash flows supporting our operations and claim payments. For the three months ended March 31, 2009 and the years ended December 31, 2008, 2007 and 2006, our net investment income was $43.6 million, $162.6 million, $128.1 million and $111.5 million, respectively, in each case exclusive of net realized gains (losses) and unrealized gains (losses) on investments. If our calculations with respect to our policy liabilities are incorrect, or if we improperly structure our investments to meet these liabilities, we could have unexpected losses, including losses resulting from forced liquidation of investments before their

maturity. The investment policies of our insurance subsidiaries are subject to insurance law requirements, and may change depending upon regulatory, economic and market conditions and the existing or anticipated financial condition and operating requirements, including the tax position, of our businesses.

We have retained BlackRock Financial Management (“BlackRock”) to manage our investment portfolio. The performance of our invested assets is subject to their performance in selecting and managing appropriate investments. BlackRock has discretionary authority over our investment portfolio within the limits of our investment guidelines.

Our net income may be volatile because a portion of the credit risk we assume is in the form of credit derivatives that are accounted for under FAS 133/149/155, which requires that these instruments be marked-to-market quarterly.

Any event causing credit spreads (i.e., the difference in interest rates between comparable securities having different credit risk) on an underlying security referenced in a credit derivative in our portfolio either to widen or to tighten will affect the fair value of the credit derivative and may increase the volatility of our earnings. Derivatives must be accounted for either as assets or liabilities on the balance sheet and measured at fair market value. Although there is no cash flow effect from this “marking to market,” net changes in the fair market value of the derivative are reported in our statement of operations and therefore will affect our reported earnings. If the derivative is held to maturity and no credit loss is incurred, any gains or losses previously reported would be offset by corresponding gains or losses at maturity. Due to the complexity of fair value accounting and the application of FAS 133/149/155, future amendments or interpretations of these accounting standards may cause us to modify our accounting methodology in a manner which may have an adverse impact on our financial results.

Common events that may cause credit spreads on an underlying municipal or corporate security referenced in a credit derivative to fluctuate include changes in the state of national or regional economic conditions, industry cyclicality, changes to a company’s competitive position within an industry, management changes, changes in the ratings of the underlying security, movements in interest rates, default or failure to pay interest, or any other factor leading investors to revise expectations about the issuer’s ability to pay principal and interest on its debt obligations. Similarly, common events that may cause credit spreads on an underlying structured security referenced in a credit derivative to fluctuate may include the occurrence and severity of collateral defaults, changes in demographic trends and their impact on the levels of credit enhancement, rating changes, changes in interest rates or prepayment speeds, or any other factor leading investors to revise expectations about the risk of the collateral or the ability of the servicer to collect payments on the underlying assets sufficient to pay principal and interest.

Changes in U.S. tax laws could reduce the demand or profitability of financial guaranty insurance, or negatively impact our investment portfolio.

Any material change in the U.S. tax treatment of municipal securities, the imposition of a national sales tax in lieu of the current federal income tax structure in the United States, or changes in the treatment of dividends, could adversely affect the market for municipal obligations and, consequently, reduce the demand for financial guaranty insurance and reinsurance of such obligations.

Changes in U.S. federal, state or local laws that materially adversely affect the tax treatment of municipal securities or the market for those securities, or other changes negatively affecting the municipal securities market, also may adversely impact our investment portfolio, a significant portion of which is invested in tax-exempt instruments. These adverse changes may adversely affect the value of our tax-exempt portfolio, or its liquidity.

Regulatory change could adversely affect our ability to enter into future business.

Future legislative, regulatory or judicial changes in the jurisdictions regulating our Company may adversely affect our ability to pursue our current mix of business, materially impacting our financial results.

The perceived decline in the financial strength of many financial guaranty insurers has caused a number of government officials to question the breadth and complexity of some of the securities guaranteed by financial guaranty insurers. For example, the Department has announced that it is working to develop new rules and regulations for the financial guaranty industry. On September 22, 2008, the Department issued Circular Letter No. 19 (2008) (the “Circular Letter”), which establishes best practices guidelines for financial guaranty insurers effective January 1, 2009. The Department plans to propose legislation and regulations to formalize these guidelines. These guidelines and the related legislation and regulations may limit the amount of new structured finance business that AGC is able to write in future periods. In addition, on June 11, 2009, a new bill was introduced into the New York General Assembly at the request of New York’s governor to amend the New York Insurance Law to enhance the regulation of financial guaranty insurers. At this time it is not possible to predict if any such new rules will be implemented or legislation enacted or, if implemented or enacted, the content of the new rules or legislation or their effect on us.

In addition, perceived problems in the credit derivative markets have led to calls for further regulation of credit derivatives at the state or federal level. Changes in the regulation of credit derivatives could materially impact the market demand for derivatives and/or our ability to enter into derivative transactions.

Actions taken at the federal level in response to the current recession could materially affect our business. Such risks include:

· Federal money could be used to capitalize a competitor;

· Federal money provided to the States could adversely impact the demand for insured bonds; and

· Proposals with respect to assistance to mortgage borrowers and/or so called “mortgage cram-down” provisions could affect our ability to realize on the collateral underlying our mortgage-backed transactions.

Our ability to meet our obligations may be constrained by our holding company structure.

Assured Guaranty is a holding company and, as such, has no direct operations of its own. We do not expect to have any significant operations or assets other than our ownership of the shares of our subsidiaries. Dividends and other permitted payments from our operating subsidiaries are expected to be our primary source of funds to meet ongoing cash requirements, including any future debt service payments and other expenses, and to pay dividends to our shareholders. Our insurance subsidiaries are subject to regulatory and rating agency restrictions limiting their ability to declare and to pay dividends and make other payments to us. Furthermore, in connection with the Acquisition, we have committed that FSA will not pay any dividends for a period of two years from the date of the Acquisition without the written approval of the New York Insurance Department. In addition, to the extent that dividends are paid from our U.S. subsidiaries, they presently would be subject to U.S. withholding tax at a rate of 30%. The inability of our insurance subsidiaries to pay sufficient dividends and make other permitted payments to us would have an adverse effect on our ability to satisfy our ongoing cash requirements and on our ability to pay dividends to our shareholders. If we do not pay dividends, the only return on your investment in our Company, if at all, would come from any appreciation in the price of our common shares.

Our ability to pay dividends may be constrained by certain regulatory requirements and restrictions.

We are subject to Bermuda regulatory constraints that will affect our ability to pay dividends on our common shares and to make other payments. Under the Bermuda Companies Act 1981, as amended (the “Companies Act”), we may declare or pay a dividend out of distributable reserves only (1) if we have reasonable grounds for believing that we are, and after the payment would be, able to pay our liabilities as they become due and (2) if the realizable value of our assets would not be less than the aggregate of our liabilities and issued share capital and share premium accounts. While we currently intend to pay dividends, if you require dividend income you should carefully consider these risks before investing in our company.

There are provisions in our Bye-Laws that may reduce or increase the voting rights of our common shares.

If, and so long as, the common shares of a shareholder are treated as “controlled shares” (as determined under section 958 of the Internal Revenue Code of 1986, as amended (the “Code”)) of any U.S. Person (as defined below) and such controlled shares constitute 9.5% or more of the votes conferred by our issued shares, the voting rights with respect to the controlled shares of such U.S. Person (a “9.5% U.S. Shareholder”) shall be limited, in the aggregate, to a voting power of less than 9.5%, under a formula specified in our Bye-Laws. The formula is applied repeatedly until the voting power of all 9.5% U.S. Shareholders has been reduced to less than 9.5%. In addition, our Board of Directors may limit a shareholder’s voting rights where it deems appropriate to do so to (1) avoid the existence of any 9.5% U.S. Shareholders, and (2) avoid certain material adverse tax, legal or regulatory consequences to us or any of our subsidiaries or any shareholder or its affiliates. “Controlled shares” include, among other things, all shares of Assured Guaranty that such U.S. Person is deemed to own directly, indirectly or constructively (within the meaning of section 958 of the Code).

Under these provisions, certain shareholders may have their voting rights limited to less than one vote per share, while other shareholders may have voting rights in excess of one vote per share. Moreover, these provisions could have the effect of reducing the votes of certain shareholders who would not otherwise be subject to the 9.5% limitation by virtue of their direct share ownership. Our Bye-Laws provide that shareholders will be notified of their voting interests prior to any vote taken by them.

As a result of any reallocation of votes, your voting rights might increase above 5% of the aggregate voting power of the outstanding common shares, thereby possibly resulting in your becoming a reporting person subject to Schedule 13D or 13G filing requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). In addition, the reallocation of your votes could result in your becoming subject to the short swing profit recovery and filing requirements under Section 16 of the Exchange Act.

We also have the authority under our Bye-Laws to request information from any shareholder for the purpose of determining whether a shareholder’s voting rights are to be reallocated under the Bye-Laws. If a shareholder fails to respond to our request for information or submits incomplete or inaccurate information in response to a request by us, we may, in our sole discretion, eliminate such shareholder’s voting rights.

For purposes of this discussion, the term “U.S. Person” means: (i) an individual citizen or resident of the United States, (ii) a partnership or corporation created or organized in or under the laws of the United States or under the laws of any political subdivision thereof, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source, (iv) a trust if either (x) a court within the United States is able to exercise primary supervision over the administration of such trust and one or more U.S. Persons have the authority to control all substantial decisions of such trust or (y) the trust has a valid election in effect to be treated as a U.S. Person for U.S. federal income tax purposes or (v) any other person or entity that is treated for U.S. federal income tax purposes as if it were one of the foregoing.

There are provisions in our Bye-Laws that may restrict the ability to transfer common shares, and that may require shareholders to sell their common shares.

Our Board of Directors may decline to approve or register a transfer of any common shares (1) if it appears to the Board of Directors, after taking into account the limitations on voting rights contained in our Bye-Laws, that any adverse tax, regulatory or legal consequences to us, any of our subsidiaries or any of our shareholders may occur as a result of such transfer (other than such as the Board of Directors considers to be de minimis), or (2) subject to any applicable requirements of or

commitments to the New York Stock Exchange, Inc. (“NYSE”), if a written opinion from counsel supporting the legality of the transaction under U.S. securities laws has not been provided or if any required governmental approvals have not been obtained.

Our Bye-Laws also provide that if our Board of Directors determines that share ownership by a person may result in adverse tax, legal or regulatory consequences to us, any of our subsidiaries or any of our shareholders (other than such as the Board of Directors considers to be de minimis), then we have the option, but not the obligation, to require that shareholder to sell to us or to third parties to whom we assign the repurchase right for fair market value the minimum number of common shares held by such person which is necessary to eliminate such adverse tax, legal or regulatory consequences.

Applicable insurance laws may make it difficult to effect a change of control of us.

Before a person can acquire control of a U.S. insurance company, prior written approval must be obtained from the insurance commissioner of the state where the domestic insurer is domiciled. Because a person acquiring 10% or more of our common shares would indirectly control the same percentage of the stock of our U.S. insurance company subsidiaries, the insurance change of control laws of Maryland and New York would likely apply to such a transaction.

These laws may discourage potential acquisition proposals and may delay, deter or prevent a change of control of our company, including through transactions, and in particular unsolicited transactions, that some or all of our shareholders might consider to be desirable.

While our Bye-Laws limit the voting power of any shareholder (other than ACE) to less than 10%, there can be no assurance that the applicable regulatory body would agree that a shareholder who owned 10% or more of our common shares did not, notwithstanding the limitation on the voting power of such shares, control the applicable insurance company subsidiary.

Some reinsurance agreement terms may make it difficult to effect a change of control of us .

Some of our reinsurance agreements have change of control provisions that are triggered if a third party acquires a designated percentage of our shares. If these change of control provisions are triggered, the ceding company may recapture some or all of the reinsurance business ceded to us in the past. Any such recapture could adversely affect our future income or ratings. These provisions may discourage potential acquisition proposals and may delay, deter or prevent a change of control of our Company, including through transactions that some or all of our shareholders might consider to be desirable.

Anti-takeover provisions in our Bye-Laws could impede an attempt to replace or remove our directors, which could diminish the value of our common shares.

Our Bye-Laws contain provisions that may make it more difficult for shareholders to replace directors even if the shareholders consider it beneficial to do so. In addition, these provisions could delay or prevent a change of control that a shareholder might consider favorable. For example, these provisions may prevent a shareholder from receiving the benefit from any premium over the market price of our common shares offered by a bidder in a potential takeover. Even in the absence of an attempt to effect a change in management or a takeover attempt, these provisions may adversely affect the prevailing market price of our common shares if they are viewed as discouraging takeover attempts in the future.

Certain of our foreign subsidiaries may be subject to U.S. tax.

We manage our business so that Assured Guaranty, AG Re and our U.K. subsidiaries (the “U.K. Subsidiaries”) will operate in such a manner that none of them should be subject to U.S. federal tax (other than U.S. excise tax on insurance and reinsurance premium income attributable to insuring or reinsuring U.S. risks, and U.S. withholding tax on certain U.S. source investment income). However, because there is considerable uncertainty as to the activities which constitute being engaged in a trade or business within the United States, we cannot be certain that the Internal Revenue Service (“IRS”) will not contend successfully that Assured Guaranty or any of our foreign subsidiaries other than AGRO is/are engaged in a trade or business in the United States. If Assured Guaranty, AG Re or either of our U.K. subsidiaries were considered to be engaged in a trade or business in the United States, each such company could be subject to U.S. corporate income and branch profits taxes on the portion of its earnings effectively connected to such U.S. business.

Assured Guaranty and its Bermuda subsidiaries may become subject to taxes in Bermuda after 2016, which may have a material adverse effect on our results of operations and on your investment.

The Bermuda Minister of Finance, under Bermuda’s Exempted Undertakings Tax Protection Act 1966, as amended, has given Assured Guaranty, AG Re and AGRO an assurance that if any legislation is enacted in Bermuda that would impose tax computed on profits or income, or computed on any capital asset, gain or appreciation, or any tax in the nature of estate duty or inheritance tax, then subject to certain limitations the imposition of any such tax will not be applicable to Assured Guaranty or our Bermuda subsidiaries, or any of our or their operations, shares, debentures or other obligations until March 28, 2016. Given the limited duration of the Minister of Finance’s assurance, we cannot be certain that we will not be subject to Bermuda tax after 2016.

U.S. Persons who hold 10% or more of our shares directly or through foreign entities may be subject to taxation under tax rules.

Each 10% U.S. Shareholder of a foreign corporation that is a controlled foreign corporation (“CFC”) for an uninterrupted period of 30 days or more during a taxable year, and who owns shares in the foreign corporation directly or indirectly through foreign entities on the last day of the foreign corporation’s taxable year on which it is a CFC, must include in its gross income for U.S. federal income tax purposes its pro rata share of the CFC’s “subpart F income,” even if the subpart F income is not distributed.

We believe that because of the dispersion of our share ownership, provisions in our Bye-Laws that limit voting power and other factors, no U.S. Person who owns our common shares directly or indirectly through foreign entities should be treated as a 10% U.S. Shareholder of us or of any of our foreign subsidiaries. It is possible, however, that the IRS could challenge the effectiveness of these provisions and that a court could sustain such a challenge.

U.S. Persons who hold shares may be subject to U.S. income taxation at ordinary income rates on their proportionate share of our related person insurance income (“RPII”).

If the gross RPII of AG Re was to equal or exceed 20% of AG Re’s gross insurance income in any taxable year and direct or indirect insureds (and persons related to such insureds) own (or are treated as owning directly or indirectly through entities) 20% or more of the voting power or value of our shares, then a U.S. Person who owns our shares (directly or indirectly through foreign entities) on the last day of the taxable year would be required to include in its income for U.S. federal income tax purposes such person’s pro rata share of AG Re’s RPII for the entire taxable year, determined as if such RPII were distributed proportionately only to U.S. Persons at that date, regardless of whether such income is distributed. In addition, any RPII that is includible in the income of a U.S. tax-exempt

organization may be treated as unrelated business taxable income. The amount of RPII earned by AG Re (generally, premium and related investment income from the direct or indirect insurance or reinsurance of any direct or indirect U.S. holder of shares or any person related to such holder) will depend on a number of factors, including the geographic distribution of AG Re’s business and the identity of persons directly or indirectly insured or reinsured by AG Re. We believe AG Re did not in prior years of operation and should not in the foreseeable future have either RPII income which equals or exceeds 20% of gross insurance income or have direct or indirect insureds, as provided for by RPII rules, of AG Re (and related persons) directly or indirectly own 20% or more of either the voting power or value of our shares. However, we cannot be certain that this will be the case because some of the factors which determine the extent of RPII may be beyond our control.

U.S. Persons who dispose of our shares may be subject to U.S. income taxation at ordinary income tax rates in a portion of their gain, if any.

The RPII rules provide that if a U.S. Person disposes of shares in a foreign insurance corporation in which U.S. Persons own 25% or more of the shares (even if the amount of gross RPII is less than 20% of the corporation’s gross insurance income and the ownership of its shares by direct or indirect insureds and related persons is less than the 20% threshold), any gain from the disposition will generally be treated as dividend income to the extent of the holder’s share of the corporation’s undistributed earnings and profits that were accumulated during the period that the holder owned the shares (whether or not such earnings and profits are attributable to RPII). In addition, such a holder will be required to comply with certain reporting requirements, regardless of the amount of shares owned by the holder. These RPII rules should not apply to dispositions of our shares because we will not ourselves be directly engaged in the insurance business; however, the RPII provisions have never been interpreted by the courts or the U.S. Treasury Department in final regulations, and regulations interpreting the RPII provisions of the Code exist only in proposed form. It is not certain whether these regulations will be adopted in their proposed form, what changes or clarifications might ultimately be made thereto, or whether any such changes, as well as any interpretation or application of RPII by the IRS, the courts, or otherwise, might have retroactive effect. The U.S. Treasury Department has authority to impose, among other things, additional reporting requirements with respect to RPII. Accordingly, the meaning of the RPII provisions and the application thereof to Assured Guaranty and AG Re is uncertain.

U.S. Persons who hold common shares will be subject to adverse tax consequences if we are considered to be a “passive foreign investment company” for U.S. federal income tax purposes.

If Assured Guaranty is considered a passive foreign investment company (“PFIC”) for U.S. federal income tax purposes, a U.S. person who owns any shares of Assured Guaranty will be subject to adverse tax consequences, including subjecting the investor to greater tax liability than might otherwise apply and subjecting the investor to tax on amounts in advance of when tax would otherwise be imposed, which could materially adversely affect your investment. We believe that Assured Guaranty is not, and we currently do not expect Assured Guaranty to become, a PFIC for U.S. federal income tax purposes; however, we cannot assure you that Assured Guaranty will not be deemed a PFIC by the IRS. There are currently no regulations regarding the application of the PFIC provisions to an insurance company. New regulations or pronouncements interpreting or clarifying these rules may be forthcoming. We cannot predict what impact, if any, such guidance would have on an investor that is subject to U.S. federal income taxation.

Changes in U.S. federal income tax law could materially adversely affect an investment in our common shares.

Legislation has been introduced in the U.S. Congress intended to eliminate certain perceived tax advantages of companies (including insurance companies) that have legal domiciles outside the United States but have certain U.S. connections. For example, legislation has been introduced in Congress to limit the deductibility of reinsurance premiums paid by U.S. companies to foreign affiliates. It is possible that this or similar legislation could be introduced in and enacted by the current Congress or future Congresses that could have an adverse impact on us or our shareholders.

U.S. federal income tax laws and interpretations regarding whether a company is engaged in a trade or business within the United States, is a PFIC, or whether U.S. Persons would be required to include in their gross income the “subpart F income” of a CFC or RPII are subject to change, possibly on a retroactive basis. There currently are no regulations regarding the application of the PFIC rules to insurance companies, and the regulations regarding RPII are still in proposed form. New regulations or pronouncements interpreting or clarifying such rules may be forthcoming. We cannot be certain if, when, or in what form such regulations or pronouncements may be implemented or made, or whether such guidance will have a retroactive effect.

The Organization for Economic Cooperation and Development and the European Union are considering measures that might increase our taxes and reduce our net income.

The Organization for Economic Cooperation and Development (the “OECD”) has published reports and launched a global dialogue among member and non-member countries on measures to limit harmful tax competition. These measures are largely directed at counteracting the effects of tax havens and preferential tax regimes in countries around the world. In response to a number of measures taken and commitments by the government of Bermuda, in June 2009, Bermuda was listed as a jurisdiction that has substantially implemented those standards. We are not able to predict what changes will arise from these changes or commitments or whether such changes will subject us to additional taxes.

Risks Related to our Common Shares

The market price of our common shares may be volatile, which could cause the value of your investment to decline.

The market price of our common shares has experienced, and may continue to experience, significant volatility. Numerous factors, including many over which we have no control, may have a significant impact on the market price of our common shares. These risks include those described or referred to in this “Risk Factors” section as well as, among other things:

· our operating and financial performance and prospects;

· our ability to repay our debt;

· our access to financial and capital markets to refinance our debt or replace our existing senior secured credit and receivables-backed facilities;

· investor perceptions of us and the industry and markets in which we operate;

· our dividend policy;

· future sales of equity or equity-related securities;

· changes in earnings estimates or buy/sell recommendations by analysts; and

· general financial, domestic, international, economic and other market conditions.

In addition, the stock market in recent years has experienced extreme price and trading volume fluctuations that often have been unrelated or disproportionate to the operating performance of individual companies. These broad market fluctuations may adversely affect the price of our common shares, regardless of our operating performance.

Our common shares are equity securities and are subordinate to our existing and future indebtedness.

Our common shares are equity interests. This means the common shares will rank junior to all of our indebtedness and to other non-equity claims on us and our assets available to satisfy claims on us, including claims in a bankruptcy or similar proceeding. Future indebtedness may restrict payment of dividends on the common shares.

Additionally, unlike indebtedness, where principal and interest customarily are payable on specified due dates, in the case of common shares, dividends are payable only when and if declared by our board of directors or a duly authorized committee of the board. Further, the common shares place no restrictions on our business or operations or on our ability to incur indebtedness or engage in any transactions, subject only to the voting rights available to stockholders generally.

There may be future sales or other dilution of our equity, which may adversely affect the market price of our common shares.

There may be future sales or other dilution of our equity, which may adversely affect the market price of our common shares. The market price of our common shares could decline as a result of sales of a large number of common shares or similar securities in the market after this offering or the perception that such sales could occur.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

See the attached exhibit index, which is incorporated herein by reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ASSURED GUARANTY LTD.

	By:	/s/ James M. Michener
		James M. Michener
		General Counsel
DATE: July 8, 2009

EXHIBIT INDEX

Exhibit Number		Description

10.1		Amended and Restated Revolving Credit Agreement dated as of June 30, 2009 among FSA Asset Management LLC, Dexia Crédit Local S.A. and Dexia Bank Belgium SA.

10.2.1		Master Repurchase Agreement (September 1996 Version) dated as of June 30, 2009 between Dexia Crédit Local S.A. and FSA Asset Management LLC.

10.2.2		Annex I — Committed Term Repurchase Agreement Annex dated as of June 30, 2009 between Dexia Crédit Local S.A. and FSA Asset Management LLC.

10.3.1		ISDA Master Agreement (Multicurrency — Cross Border) dated as of June 30, 2009 among Dexia SA, Dexia Crédit Local S.A. and FSA Asset Management LLC.

10.3.2		Schedule to the 1992 Master Agreement, Guaranteed Put Contract, dated as of June 30, 2009 among Dexia Crédit Local S.A., Dexia SA and FSA Asset Management LLC.

10.3.3		Put Option Confirmation, Guaranteed Put Contract, dated June 30, 2009 to FSA Asset Management LLC from Dexia SA and Dexia Crédit Local S.A.

10.3.4		ISDA Credit Support Annex (New York Law) to the Schedule to the ISDA Master Agreement, Guaranteed Put Contract, dated as of June 30, 2009 between Dexia Crédit Local S.A. and Dexia SA and FSA Asset Management LLC.

10.4.1		ISDA Master Agreement (Multicurrency — Cross Border) dated as of June 30, 2009 among Dexia SA, Dexia Crédit Local S.A. and FSA Asset Management LLC.

10.4.2		Schedule to the 1992 Master Agreement, Non-Guaranteed Put Contract, dated as of June 30, 2009 among Dexia Crédit Local S.A., Dexia SA and FSA Asset Management LLC.

10.4.3		Put Option Confirmation, Non-Guaranteed Put Contract, dated June 30, 2009 to FSA Asset Management LLC from Dexia SA and Dexia Crédit Local S.A.

10.4.4		ISDA Credit Support Annex (New York Law) to the Schedule to the ISDA Master Agreement, Non-Guaranteed Put Contract, dated as of June 30, 2009 between Dexia Crédit Local S.A. and Dexia SA and FSA Asset Management LLC.

10.5		First Demand Guarantee Relating to the “Financial Products” Portfolio of FSA Asset Management LLC issued by the Belgian State and the French State and executed as of June 30, 2009.

10.6		Guaranty, dated as of June 30, 2009, made jointly and severally by Dexia SA and Dexia Crédit Local S.A., in favor of Financial Security Assurance Inc.

10.7		Indemnification Agreement (GIC Business) dated as of June 30, 2009 by and among Financial Security Assurance Inc., Dexia Crédit Local S.A. and Dexia SA.

10.8		Pledge and Administration Agreement, dated as of June 30, 2009, among Dexia SA, Dexia Crédit Local S.A., Dexia Bank Belgium SA, Dexia FP Holdings Inc., Financial Security Assurance Inc., FSA Asset Management LLC, FSA Portfolio Asset Limited, FSA Capital Markets Services LLC, FSA Capital Markets Services (Caymans) Ltd., FSA Capital Management Services LLC and The Bank of New York Mellon Trust Company, National Association.

10.9		Separation Agreement, dated as of July 1, 2009, among Dexia Crédit Local S.A., Financial Security Assurance Inc., Financial Security Assurance International, Ltd., FSA Global Funding Limited and Premier International Funding Co.

10.10		Funding Guaranty, dated as of July 1, 2009, made by Dexia Crédit Local S.A. in favor of Financial Security Assurance Inc. and Financial Security Assurance International, Ltd.

10.11		Reimbursement Guaranty, dated as of July 1, 2009, made by Dexia Crédit Local S.A. in favor of Financial Security Assurance Inc. and Financial Security Assurance International, Ltd.

10.12		Strip Coverage Liquidity and Security Agreement, dated as of July 1, 2009, between Financial Security Assurance Inc. and Dexia Crédit Local S.A.

10.13		Indemnification Agreement (FSA Global Business), dated as of July 1, 2009, by and between Financial Security Assurance Inc., Assured Guaranty Ltd.and Dexia Crédit Local S.A.

10.14		Pledge and Administration Annex Amendment Agreement dated as of July 1, 2009 among Dexia SA, Dexia Crédit Local S.A., Dexia Bank Belgium SA, Dexia FP Holdings Inc., Financial Security Assurance Inc., FSA Asset Management LLC, FSA Portfolio Asset Limited, FSA Capital Markets Services LLC, FSA Capital Markets Services (Caymans) Ltd., FSA Capital Management Services LLC and The Bank of New York Mellon Trust Company, National Association.

10.15		Put Confirmation Annex Amendment Agreement dated as of July 1, 2009 among Dexia SA and Dexia Crédit Local S.A. and FSA Asset Management LLC and Financial Security Assurance Inc.

10.16		Settlement Agreement and Plan by and between Financial Security Assurance Holdings, Ltd., Assured Guaranty Ltd., Dexia Holdings, Inc., Dexia Crédit Local, S.A. and Sean W. McCarthy (Incorporated by reference to Exhibit 4.4 of the company’s Registration Statement on Form S-8 (No. 333-160-367))

10.17		Employment Agreement dated as of July 1, 2009 between Assured Guaranty U.S. Holdings, Inc. and Sean McCarthy

23.1		Consent of PricewaterhouseCoopers LLP

99.1		Press Release Dated July 1, 2009

99.2		Audited consolidated balance sheets of Financial Security Assurance Holdings Ltd. at December 31, 2008 and December 31, 2007 and the related consolidated statements of operations and comprehensive income, consolidated statements of changes in shareholders’ equity and consolidated statements of cash flows for each of the years ended December 31, 2008, 2007 and 2006.

99.3		Consolidated balance sheets of Financial Security Assurance Holdings Ltd. at March 31, 2009 and December 31, 2008, the related consolidated statements of operations, consolidated statements of comprehensive income, consolidated statements of changes in shareholders’ equity and consolidated statements of cash flows for the three-month periods ended March 31, 2009 and March 31, 2008

99.4		Pro forma financial information.

Exhibit 10.1

EXECUTION VERSION

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT dated as of June 30, 2009 (this “ Agreement ”) among FSA Asset Management LLC, a Delaware limited liability company (with its successors, the “ Company ”), Dexia Crédit Local S.A., a French share Company licensed as a bank under French law, acting through its head office located at 1, Passerelle des Reflets, Tour Dexia La Défense 2, 92913 La Défense Cedex, France (with its successors “ DCL ”) and Dexia Bank Belgium SA, a Belgian bank acting through its head office located at Boulevard Pachéco 44, 1000 Brussels, Belgium (with its successors “ DBB ” and, together with DCL, the “ Banks ”).

WHEREAS , the Company and the Banks have entered into a Revolving Credit Agreement, dated as of June 30, 2008 and a Second Revolving Credit Agreement dated February 20, 2009 (together, as amended, restated, supplemented or otherwise modified prior to the date hereof, including by the letter agreement dated February 20, 2009, the “ Existing Agreements ”);

WHEREAS , the Company has requested that the Existing Agreements be consolidated, amended and restated in their entirety to reflect the terms of this Agreement, and the Banks have agreed to amend and restate the Existing Agreements in their entirety to read as set forth in this Agreement with the intent that the terms of this Agreement shall supersede the terms of the Existing Agreements (each of which shall hereafter have no further effect upon the parties thereto, other than those that remain herein and other than for accrued fees and expenses, and indemnification obligations (if any) accrued and owing under the terms of the Existing Agreements on or prior to the date hereof, in each case to the extent provided for in the Existing Agreements); and

WHEREAS , upon the terms and subject to the conditions set forth herein, the Banks are willing to make loans and advances to the Company.

NOW, THEREFORE, the Company and the Banks hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions . Capitalized terms used but not defined herein have the meaning provided to them under the Pledge and Administration Agreement. The following terms, as used herein, have the following meanings:

“ Accelerated Downgrade Liquidity Draw ” means a Liquidity Draw Request for the purpose of paying, or reserving funds for payment of, the maximum amount potentially payable under the Accelerated Termination GICs as a result of a GIC Credit Event which has made one or more Accelerated Termination Downgrade Provisions applicable under the relevant Accelerated Termination GICs .

“ Accelerated Downgrade Liquidity Draw Deadline ” means 9:00 A.M. (New York City time) on the first Business Day after the date on which the relevant Accelerated Downgrade Liquidity Draw is deemed requested.

“ Accelerated Termination Downgrade Provision ” means a provision that requires the termination and repayment of an FSA GIC Contract either automatically, or assuming immediate notice from the relevant GIC Holder electing such termination and repayment, upon a relevant GIC Credit Event, and which becomes applicable six “business days” (as defined in the relevant FSA GIC Contract) or sooner after a downgrade of the rating of FSA’s financial strength to below a threshold of “A-” by S&P or “A3” by Moody’s (or to below a lower threshold) .

“ Accelerated Termination GIC ” means an FSA GIC Contract which is subject to an Accelerated Termination Downgrade Provision and which is identified as an Accelerated Termination GIC in Appendix 3 to the Sovereign Guarantee .

“ Additional Costs ” means amounts due and payable pursuant to Sections 2.05 and 2.06.

“ Agent ” shall mean DCL (New York Branch) unless otherwise noticed by DCL and DBB.

“ Agreement ” shall have the meaning specified in the preamble.

“ Authorized Account ” means the FSAM Cash Account.

“ Authorized Signatory ” means any person designated by the Company, the Collateral Agent or FSA on Exhibit B , as applicable. Changes to the authorized signatories list require the signature of two authorized signatories except that the authorized signatories list for the Collateral Agent and FSA may be changed upon instruction of an authorized officer of the Collateral Agent or FSA, as applicable.

“ Base Rate ” means, for any day, the Federal Funds Rate for such day.

“ Business Day ” means, in respect of any date, a day that is not a Saturday or Sunday or a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealings in foreign exchange) in the Cities of New York, London, Brussels and Paris.

“ Commitment ” means either the First Tranche Commitment or the Second Tranche Commitment, as the context requires.

“ Dollars ” or “$” means the lawful currency of the United States of America.

“ Existing Agreements ” shall have the meaning specified in first recital.

“ Federal Funds Rate ” means, for any period, a fluctuating interest rate equal for each day during such period to the weighted average of the rates on overnight Federal Funds transactions with members of the Federal Reserve System arranged by Federal Funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average rate quoted to the Banks at approximately 11:00 a.m. (New York City time) on such day (or, if such day is not a Business Day, on the next preceding Business Day) for

overnight Federal Funds transactions arranged by New York Federal Funds brokers of recognized standing selected by the Banks.

“ First Tranche Commitment ” means $5 billion, or such lesser amount to which the Commitment shall be reduced from time to time in accordance with the terms of this Agreement.

“ FSA ” means Financial Security Assurance Inc., a New York stock insurance company, and its successors and assigns.

“ GIC Credit Event ” means with respect to any FSA GIC Contract, the downgrade, qualification or withdrawal of the credit ratings of FSA by one or more of Moody’s, Fitch or S&P, as specified in that FSA GIC Contract.

“ Interest Period ” means, with respect to any LIBO Rate Loan, the one-, two-, three- or six-month maturity applicable to such Loan, as specified by the Company at the time of its request for such Loan in accordance with Section 2.01(b).

“ LIBO Rate ” shall have the meaning specified in Section 2.01(g).

“ LIBO Rate Loan ” shall have the meaning specified in Section 2.01(g).

“ Loan ” means any loan made by the Banks to the Company pursuant to Section 2.01.

“ Maturity Date ” means the earlier of (i) any date following a Dexia Event of Default on which funds are available for payments to the Banks under the Priority of Payments and subject to the satisfaction of the Subordinated Claims Payment Condition specified therein, and (ii) the date on which all of the FSA GIC Contracts are Paid in Full or terminated and there are no outstanding amounts owed by the Company under the FSAM Insurance Agreement, the FSAM Administrative Services Agreement, or the Master Repurchase Agreement. Where clause (i) of the foregoing sentence applies, outstanding Loans shall be repaid to the extent permitted in accordance with the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) subject to the satisfaction of the Subordinated Claims Payment Condition specified therein.

“ Note ” shall have the meaning specified in Section 2.01(i).

“ Pledge and Administration Agreement ” means the pledge and administration agreement, dated as of June 30, 2009, among DCL, DBB, Dexia SA, Dexia FP Holdings Inc. (“Dexia FP”), the Company, FSA Portfolio Asset Limited, FSA Capital Markets LLC, FSA Capital Management Services LLC, FSA Capital Markets Services (Caymans) Ltd., FSA and The Bank of New York Mellon Trust Company, National Association as Collateral Agent (the “Collateral Agent”), as amended, restated, supplemented or otherwise modified from time to time.

removed from the Reuters Monitor Money Rates Service or in any other way fail to meet the qualifications of a Reference Bank, the Banks in the exercise of their good faith business judgment may designate one or more alternative banks meeting the criteria specified in clauses (i) and (ii) above as Reference Banks for purposes of this Annex.

“ Second Tranche Commitment ” means $3 billion, or such lesser amount to which the Commitment shall be reduced from time to time in accordance with the terms of this Agreement.

“ Termination Date ” means the earliest to occur of the following: (a) the date on which all of the FSA GIC Contracts are Paid in Full or terminated and there are no outstanding amounts owed by the Company under the FSAM Insurance Agreement, the Master Repurchase Agreement or the FSAM Administrative Services Agreement that have not been Paid in Full, (b) the date which is (x) in the case of a Dexia Event of Default occurring at least 10 Business Days prior to the Liquidity and Collateral Trigger Expiration Date, the Liquidity and Collateral Expiration Date and (y) in the case of a Dexia Event of Default occurring on or after the tenth Business Day preceding the Liquidity and Collateral Trigger Expiration Date, 30 calendar days following such Dexia Event of Default (or if such day is not a Business Day, the next Business Day), and (c) the Business Day immediately following funding of the one-time draw permitted under Section 2.03.

“ Total Commitment ” means the sum of the First Tranche Commitment and the Second Tranche Commitment.

“ Weekly Assessment Point ” means the first Business Day of each calendar week, when FSAM will evaluate the balance of cash in the FSAM Cash Account at the opening of business on such day, the payments expected to be received over the next seven calendar days and, with respect to collateral posting requirements, the amount of qualifying assets otherwise available to satisfy such posting requirements and compare such required amount to the Senior Priority Payments required to be paid during the next seven calendar days.

ARTICLE II

THE LOANS

Section 2.01 Loans .

(a) At the request of the Company (or of the Collateral Agent or FSA as described in Section 2.01(d) below), the Banks shall, each up to the part of the Total Commitment specified for such Bank from time to time in Schedule A (with respect to any Bank the “Bank Commitment” of such Bank) and subject to the terms and conditions of this Agreement, from time to time on Business Days during the period from and including the date hereof to and including the Termination Date, make one or more Loans to the Company pursuant to the terms of paragraph (b) below such that, at the time of the making of any such Loan, the aggregate principal amount of all Loans outstanding hereunder at such time (including such Loan) shall not exceed the Total Commitment. As of close of business on June 29, $4.2 billion in aggregate principal amount of the Loans has been advanced and is outstanding under the Existing Agreements and will be continued as Loans outstanding under this Agreement.

(b) The Company (or the Collateral Agent or FSA as described in Section 2.01(d) below) may request a Loan only by written notice to the Agent made by an Authorized Signatory, specifying the amount to be borrowed (which must be in a minimum principal amount of $5,000,000 or any larger amount in increments of $1,000,000 unless such request represents the remainder of the Total Commitment) and the Interest Period to be applicable to the proposed Loan. Except as provided in Sections 2.01(c) and (d), such notice must be delivered to the Agent at or before 4:30 P.M. (Paris time) (the “ Notice Deadline ”) on the Business Day prior to the date of the proposed borrowing. Any requests for a Loan will be made by email or facsimile, return receipt requested, in accordance with the address information set forth in Section 5.03 below. The Banks shall advance funds with respect to such Loan or Loans by 2:00 P.M. (New York City time) on the date of the proposed borrowing unless such notice is delivered after the Notice Deadline except as provided in Sections 2.01(c) and (d), in which case the Banks will be required to advance funds with respect to such Loan or Loans by 2:00 P.M. (New York City time) on the Business Day following the date of the proposed borrowing.

(c) Notwithstanding the foregoing, an Accelerated Downgrade Liquidity Draw will be deemed to have been made on the day of the GIC Credit Event without regard to whether such GIC Credit Event occurred before or after close of business on that day. The Banks will be required to advance funds with respect to such Loan or Loans by the Accelerated Downgrade Liquidity Draw Deadline, notwithstanding any failure of the Company to comply with Sections 2.01(b), 2.02(a) and 4.01(c) in connection with such deemed request. Without conditioning the obligations of the Banks to provide funds under this paragraph, FSA shall provide notice of such GIC Credit Event on the date such event occurs.

(d) In the event that FSA has given written notice to the Company with a copy to the Agent and the Banks that (i) the Company has failed to comply with the Company’s obligation to request a Loan under this Agreement as set forth in Section 11.2 of the Pledge and Administration Agreement by 4:30 P.M. (Paris time) on any Business Day or that (ii) Senior Priority Payments cannot be paid on any Business Day and the Company has not requested a Loan as set forth in Section 11.2 of the Pledge and Administration Agreement in an amount equal to such unpaid Senior Priority Payments or the remaining amount available under the Total Commitment (if less) by 4:30 P.M. (Paris time), then the Collateral Agent or FSA shall be authorized to request a Loan on behalf of the Company, and such request, if made no later than 4:30 P.M. (Paris time) on the Business Day immediately following the Business Day on which the Company fails to request a Loan pursuant to Section 11.2 of the Pledge and Administration Agreement, will be deemed to have been made by 4:30 P.M. (Paris time) on the preceding Business Day and the Banks shall advance funds with respect to such Loan or Loans by 2:00 P.M. (New York City time) on the Business Day following the failure by the Company to make the request notwithstanding any failure of the Company to comply with Sections 2.01(b) (with respect to the Notice Deadline), 2.02(a) and 4.01(c). Any such request by the Collateral Agent or FSA must be accompanied by the certificate described in Section 2.02(d). In the event that a Dexia Event of Default has occurred and FSA has elected to become Secured Party Representative, the Collateral Agent or FSA shall be authorized to request a Loan on behalf of the Company, and such request shall be effective hereunder as if made by the Company.

(e) The proceeds of any Loan shall be paid by wire transfer of immediately available funds to either (i) the Authorized Account or (ii) the relevant account for any Senior Priority Payment identified by FSAM under Section 11.2 of the Pledge and Administration Agreement in relation to which a Loan is requested hereunder.

(f) The First Tranche Commitment shall be drawn in full before any amounts are drawn under the Second Tranche Commitment. Any amounts repaid or prepaid under this Agreement shall be applied by the Banks in accordance with Section 11.1(b)(viii) of the Pledge and Administration Agreement, with each subclause being allocated first to the First Tranche Commitment and second to the Second Tranche Commitment. The Banks shall fund any Loan as notified by the Agent. The Bank Commitments and other obligations of the Banks under this Agreement are several and not joint.

(g) If the Company, the Collateral Agent or FSA has effected a Liquidity Draw Offset (as defined in the Credit Support Annex to the Dexia Guaranteed Put Contract) in relation to any Loan not yet funded by the relevant Bank(s) in relation to any Liquidity Draw Request hereunder, the amount to be funded by the relevant Bank(s) in relation to such Loan shall be reduced by the relevant Liquidity Draw Offset. DBB shall reimburse DCL or Dexia for any Liquidity Draw Offset to the extent that any Loan that would otherwise have been required to be funded by DBB is funded through such Liquidity Draw Offset.

Loans will be only “ LIBO Rate Loans ”, each of which shall be denominated in Dollars and have an Interest Period as selected by or on behalf of the Company, subject to standard market conventions as to adjustments for non-Business Days and month-ends (but in no event extending beyond the Maturity Date), and shall bear a per annum interest rate equal to 1.40% over the applicable LIBO Rate. For purposes hereof, the applicable “ LIBO Rate ” shall be the Dollar LIBO Rate for the applicable Interest Period determined by reference to Reuters Screen LIBOR01 (the “ Telerate Service ”) as of 11:00 A.M., London time, two Business Days prior to the first day of such Interest Period or (if such rate does not so appear on the Telerate Service) on the basis of the arithmetic mean of the rates at which deposits in Dollars are offered by the Reference Banks at approximately 11:00 A.M., London time, to prime banks in the London interbank market. All percentages resulting from any calculations or determinations referred to in the definition of “ LIBO Rate ” will be rounded upwards, if necessary, to the nearest multiple of 1/100 th of 1% and all Dollar amounts used in or resulting from such calculations will be rounded to the nearest cent (with one-half cent or more being rounded upwards). Loans on one Business Day’s notice shall bear a per annum interest rate equal to 1.75% over the applicable LIBO Rate.

(h) Each Loan will bear interest from its date until the Maturity Date on the basis specified to the Company (or the Collateral Agent or FSA as described in Section 2.01(d)) by the Agent (subject to subsection (b) above) contemporaneously with the making of such Loan, payable on the last day of each Interest Period, subject to the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) satisfaction of the Subordinated Claims Payment Condition specified therein. Overdue payments of principal, interest and other amounts payable hereunder shall bear interest, payable, subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, at a rate for each day equal to the Base Rate for such day plus 1% per annum. The Company must repay all loans, together with accrued and unpaid

interest thereon, on the Maturity Date, subject to the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) satisfaction of the Subordinated Claims Payment Condition specified therein.

The Company may prepay a Loan in whole or in part on any date provided it shall give the Agent notice of the prepayment not later than the second Business Day before the date it wishes to designate for the prepayment, specifying the date on which the prepayment is to be made and the amount to be prepaid on that date. Subject to the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) satisfaction of the Subordinated Claims Payment Condition specified therein, the notice shall constitute the Company’s irrevocable commitment to prepay that amount on that date, together with interest accrued on the amount prepaid to but excluding the prepayment date and any costs required to be reimbursed in accordance with Section 2.07(d).

(i) All Loans shall be evidenced by a promissory note appropriately completed, executed and delivered by or on behalf of the Company in the form of Exhibit A hereto (the “ Note ”). The Agent will endorse on the Note (on behalf of and at the direction of the Banks) or the Banks will otherwise record in their internal records the amount of each Loan, the interest rate applicable thereto and each payment of principal or interest made in respect thereof; provided that neither the failure of the Agent to do so nor any error by the Agent or the Banks in doing so shall affect the obligations of the Company hereunder or under the Note. All existing notes under the Existing Agreement will be returned and cancelled against delivery of an amended and restated Note. Upon request by the Agent, the Company will execute restated or amended Notes to evidence the Company’s obligations hereunder to the Banks.

Section 2.02 Conditions to Borrowing .

(a) The obligations of the Bank to make a Loan will be unconditional and subject only (except as provided in Section 2.01(c)) to receipt by the Agent of the written notice contemplated by Section 2.01(b) and the certificate described in 2.02(d) within the time period contemplated thereby or by Section 2.01(d).

(b) Without limitation of Section 2.10 below, no breach by the Company (or by the Collateral Agent, FSA, any other party to the Pledge and Administration Agreement or any other Person) of any representation, warranty, covenant or other term or condition of this Agreement, the Pledge and Administration Agreement, or any other Transaction Document or any other agreement described in or contemplated in the Purchase Agreement shall constitute a defense to or otherwise limit or impair the obligation of the Bank to fund a Loan requested hereunder in accordance with the terms and conditions described in Section 2.02(a) above.

(c) Notwithstanding Section 2.02(b) above, the Agent and the Banks will be indemnified by the Company for any losses incurred by them in connection with the making of any Loan to the Company if the representations and warranties of the Company are inaccurate or the Company has breached its obligations under this Agreement to the Banks, provided that any such indemnification or any other claim or recourse of the Agent or the Bank for a breach by the Company of any representation, warranty, covenant or other term or condition of this agreement (other than as set forth in Section 2.02(a) above) will be payable only subject to the Priority of

Payments and (without prejudice to any claims for Dexia Reimbursement Payments in accordance with the terms of the Pledge and Administration Agreement) satisfaction of the Subordinated Claims Payment Condition specified therein.

(d) At the time of any request for a Loan, the Administrator (or if the Administrator has failed to make the relevant evaluation and comparison, FSA) shall deliver a certificate to the Agent, setting out the evaluation and comparison contemplated to be made by the Administrator under Sections 9.1 and 11.2(a) and (b) of the Pledge and Administration Agreement (and may also include any updates to such information) and stating that the proceeds of the relevant Loan will be used as contemplated by Section 4.01(c). Notwithstanding the foregoing, if the proceeds of any Loan give rise to a Dexia Reimbursement Payment, such portion of any Loan shall be repaid promptly, together with any interest accrued thereon (but excluding any Additional Costs) and such repayment shall not be subject to the Subordinated Claims Payment Condition.

Section 2.03 Default Termination Loan . If a Dexia Event of Default has occurred, the Company (or the Collateral Agent or FSA as described in Section 2.01(d)) is permitted to request, on or before the Termination Date, a single Loan (a “ Default Termination Loan ”) in an amount that, together with any Default Repo Termination Request (as defined in the Repurchase Facility Agreement), does not exceed (i) the Exposure as calculated under the Credit Support Annex to the Dexia Guaranteed Put Contract (as most recently determined on or prior to the date of such Loan request), provided that for such purpose the “ GIC Business Costs Amount ” shall be deemed increased by 25% minus (ii) (A) the “ Value ” as of all “ Posted Collateral ” held by the Collateral Agent under the Dexia CSAs (as such terms are defined in the relevant Dexia CSA and as most recently determined on or prior to the date of such Loan request) plus (B) the cash proceeds of the liquidation of any FSAM Collateral which has been sold or liquidated in accordance with an exercise of creditor’s remedies by the Collateral Agent upon such Dexia Event of Default. For the avoidance of doubt, the amount of any Loan requested by the Company (or the Collateral Agent or FSA as described in Section 2.01(d)) shall not exceed the unused amount of the Commitment at the time of the request.

Section 2.04 Commitment Fees . The Company agrees to pay, subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, to the Banks a commitment fee at the rate of 0.40% per annum on the unused amount of the Commitment as determined by calculating the average unused amount of the Commitment for each day of the fiscal quarter on the Weekly Assessment Point immediately following the end of each fiscal quarter. Such fee shall be payable quarterly in arrears three (3) Business Days following each Weekly Assessment Point, if such fee was considered in making the calculations on such day, in accordance with the preceding sentence, and on the date on which the Commitment terminates.

Section 2.05 Taxes; Increased Costs .

(a) Except as otherwise expressly agreed by the parties, all payments under this Agreement (including, without limitation, payments of interest and principal) will be payable , subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, to the Banks free and clear of any and all present and future taxes, levies, imposts, duties, deductions, withholdings, fees, liabilities and similar charges other than those imposed on the

overall net income of the Banks (“ Taxes ”). If any Taxes are required to be withheld or deducted from any amount payable under this Agreement, then the amount payable under this Agreement will be increased (but the payment of such increase shall be due and payable three (3) Business Days after the first Weekly Assessment Point on which such increase was considered in making the calculations on such day) to the amount which, after deduction from such increased amount of all Taxes required to be withheld or deducted therefrom, will yield to the Banks the amount stated to be payable under this Agreement, and the Company will promptly provide to the Banks tax receipts evidencing the payment of such Taxes. If any of the Taxes specified in this subsection (a) are paid by the Banks, the Company will, on notice from the Banks, reimburse the Banks for such payments three (3) Business Days after the first Weekly Assessment Point on which such amounts were considered in making the calculations on such day, together with any interest and penalties which may be imposed by the governmental agency or taxing authority in respect thereof.

(b) If, after the date hereof, the adoption of any law, rule or regulation, or any change therein, or any change in the interpretation or administration thereof by any Governmental Authority charged with the interpretation or administration thereof or compliance by the Banks with any request or directive (whether or not having the force of law) of any such authority, central bank or comparable agency (i) subjects the Banks to any charge with respect to any Loan or the Commitment or changes the basis of taxation of payments to the Banks hereunder or under the Note (except for changes in the rate of tax on the overall net income of the Banks) or (ii) imposes, modifies or makes applicable any reserve, special deposit, deposit insurance assessment or similar requirement against loans made by the Banks, and the result of any of the foregoing is to increase the cost to the Banks of making or maintaining such Loan or to reduce any amount received or receivable by the Banks hereunder or under the Note, then, upon demand by the Banks, the Company shall pay , subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, to the Agent such additional amount or amounts as will compensate the Banks for such increased cost or reduction; provided that the Banks shall have provided to the Company thirty days’ prior written advice of any such additional amounts (and the basis for calculation thereof). In determining such additional amounts, the Banks will act reasonably and in good faith. A certificate of the Banks as to the additional amount or amounts payable to the Banks under this subsection (b) shall be conclusive absent manifest error.

Section 2.06 Capital Adequacy . If the adoption after the date hereof of any applicable law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any Governmental Authority charged with the interpretation or administration thereof, or compliance by the Banks with any request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or other agency, has or would have the effect of reducing the rate of return on a Banks’ capital as a consequence of a Banks’ obligations hereunder or under any Loan to a level below that which the Banks could have achieved but for such adoption, change or compliance by an amount deemed by the Banks to be material, the Company shall pay on the third Business Day after the first Weekly Assessment Point on which such increase was considered in making the calculations on such day , subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, to the Banks, on demand, such additional amount or amounts as will compensate the Banks for such reduction; provided that the Banks shall have provided to the Company thirty days’ prior written advice of any such additional amounts (and the basis for

calculation thereof). In determining such additional amounts, the Banks will act reasonably and in good faith. A certificate of the Banks as to the additional amount or amounts payable to the Banks under this Section 2.06 shall be conclusive absent manifest error.

Section 2.07 Payments and Computations .

(a) Subject to the terms and provisions of this Agreement, all amounts of principal, interest, fees and other obligations payable by the Company hereunder or under the Note shall be made, subject to the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) satisfaction of the Subordinated Claims Payment Condition specified therein, by 4:30 P.M. (Paris time) on the date when due to the Banks by wire transfer of immediately available funds to (i) the account of Dexia Crédit Local at Citibank, N.A., New York (swift code: CITIUS33), ABA No. 021000089, favour Dexia Crédit Local, Paris (swift code: CLFRFRPP) account no.: 36125091, Ref.: Revolving Credit Agreement FSAM; or (ii) such other account or at such other location as may otherwise from time to time be notified to the Company by the Agent in writing.

(b) All computations of interest and fees shall be made on the basis of a year of 360 days, for the actual number of days elapsed (including the first day but excluding the last day). Notwithstanding anything to the contrary set forth herein or in the Note, interest shall in no event accrue hereunder or under the Note at a rate in excess of the maximum rate permitted under applicable law.

(c) Whenever any payment to be made hereunder shall be stated to be due on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall be included in the computation of payment of interest or fees, as the case may be.

(d) If for any reason the principal of any LIBO Rate Loan, or any portion thereof, is paid on a date other than an applicable interest rollover date or if any LIBO Rate Loan is not borrowed after notice thereof shall have been received by the Banks, the Company will reimburse the Banks, on demand, subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, for any resulting loss or expense incurred by the Banks, including without limitation any loss or expense incurred in obtaining, liquidating or employing deposits from third parties.

(e) The Banks are hereby authorized to charge the account, if any, of the Company maintained with the Banks for each payment of principal, interest and fees due from the Company as it becomes due hereunder, to the extent such amounts are due and payable to the Banks and which the Company has failed to pay such amounts to the Banks despite the availability of funds to make such payment in accordance with the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein.

Section 2.08 Optional Reduction of Commitment by the Company . With the prior written consent of FSA, the Company may reduce the unused portion of the Commitment at any time in whole, or from time to time in part by an amount equal to $5,000,000 or any larger amount

in increments of $1,000,000 (or any reduction that reduces the Total Commitment to the amount outstanding), by delivering to the Banks and the Agent written notice specifying the amount of such reduction and the date on which such reduction is to become effective (which date may not be earlier than the date of delivery of such notice). Any such reduction shall be applied first to the First Tranche Commitment and second to the Second Tranche Commitment. Any such reduction shall be irrevocable and shall reduce the Commitment as specified by Company, and Schedule A to this Agreement shall be accordingly amended to reflect such reduction. Any such reduction without the prior written consent of FSA shall be void ab initio .

Section 2.09 Waiver of Setoff . Without prejudice to the Liquidity Draw Offset provision set forth in Section 2.01(g), the rights and obligations of the parties hereunder shall not be subject to, and shall not form the basis for, any rights of setoff arising from a transaction not subject to this Agreement; provided , that if on any day there are amounts in the same currency payable both by a Bank to the Company and by the Company to a Bank, in accordance with the Priority of Payments, such amounts may be set off against one another and only a single net amount transferred by a Bank to the Company, or by the Company to a Bank, as the case may be.

Section 2.10 Subordination. Each Bank agrees any and all amounts payable to it (including all amounts outstanding as of the date of this Agreement) by the Company under this Agreement and any Transaction Documents shall be paid to a Bank only in accordance with the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) satisfaction of the Subordinated Claims Payment Condition specified therein.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Section 3.01 Representations and Warranties . The Company represents and warrants to the Banks as follows:

(a) The Company is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware, and has all requisite power and authority, corporate and otherwise, to conduct its business as now conducted and to own its properties. The Company has full power and authority to enter into this Agreement and the Note and to incur its obligations provided for herein and therein, all of which have been duly authorized by all proper and necessary corporate action on the part of the Company. This Agreement has been duly executed and delivered by the Company and constitutes the valid and legally binding agreement of the Company, enforceable against the Company in accordance with its terms, except as enforceability may be affected by bankruptcy, insolvency and other laws relating to or affecting creditors’ rights generally and by general principles of equity. Upon execution and delivery thereof, the Note will constitute a valid and legally binding obligation of the Company, enforceable in accordance with its terms, except as enforceability may be affected by bankruptcy, insolvency and other laws relating to or affecting creditors’ rights generally and by general principles of equity.

(b) All consents and approvals of, and all notices to and filings with, any governmental entities or regulatory bodies required as a condition to the valid execution, delivery or performance

by the Company of this Agreement and the Note have been obtained or made. Neither the execution and delivery of this Agreement and the Note nor compliance with the terms and provisions hereof and thereof will conflict with, result in a breach of or constitute a default under (i) any of the terms, conditions or provisions of the limited liability company agreement of the Company, (ii) any law, regulation or order, writ, judgment, injunction, decree, determination or award of any court or governmental instrumentality or (iii) any agreement or instrument to which the Company is a party or by which it is bound.

(c) The consolidated financial statements of the Company and its consolidated subsidiaries (if any) furnished or made available to the Banks on or prior to the date on which this representation is made or deemed repeated are complete and correct and fairly present the consolidated financial condition of the Company and its consolidated subsidiaries as at the dates thereof and the results of operations for the periods covered thereby (subject, in the case of quarterly statements, to normal, year-end audit adjustments). Such financial statements were prepared in accordance with International Financial Reporting Standards as promulgated by the International Standards Accounting Board or U.S. generally accepted accounting principles, in each case consistently applied.

(d) Except as disclosed in the manner described in Section 3.1(a)(v) of the Pledge and Administration Agreement, there is no action, suit or proceeding pending against, or to the Company’s knowledge threatened against or affecting, the Company before any court or arbitrator or any governmental body, agency or official which, if adversely determined, would have a material adverse effect (actual or prospective) on the Company’s business, properties or financial position or which seeks to terminate or calls into question the validity or enforceability of this Agreement or the Note.

(e) The Company is not (i) a “holding company,” or a “subsidiary company” of a “holding company,” or of a “subsidiary company” of a “holding company,” within the meaning of the Public Utility Holding Company Act of 1935, or (ii) required to be registered as an “investment company” as defined in (or subject to regulation under) the Investment Company Act of 1940. Neither the making of the Loans, or the application of the proceeds or repayment thereof by the Company, nor the consummation of other transactions contemplated hereunder, will violate any provision of the Public Utility Holding Company Act of 1935, the Investment Company Act of 1940 or any rule, regulation or order of the SEC.

ARTICLE IV

COVENANTS

Section 4.01 Covenants of the Company. The Company covenants and agrees that until the later to occur of (i) the Maturity Date and (ii) the performance of all obligations of the Company hereunder and under the Note:

(a) General Affirmative Covenants. The Company will maintain its existence as a limited liability company in good standing, will comply in all material respects with all applicable laws, rules, regulations and orders of any governmental authority noncompliance with which would have a material adverse effect on its financial condition or operations or on its ability to meet its

obligations hereunder, and will continue to engage in business of the same general type as that engaged in by the Company on the date hereof. The Company will pay and discharge, at or before maturity, all its obligations and liabilities, including, without limitation, tax liabilities, where failure to satisfy such obligations or liabilities in the aggregate would have a material adverse effect on its financial condition, operations or ability to meet its obligations hereunder. The Company’s obligations hereunder and under the Note will rank pari passu with all other unsecured and unsubordinated obligations of the Company.

(b) Financial Statements. Upon request of the Agent, provided reasonable advanced notice to the Company, the Company will furnish to the Agent, unless a Transition Date has occurred,

(1) a copy of all financial statements provided by the Company to FSA or any other party to the Pledge and Administration Agreement from time to time; and

(2) from time to time, such further information regarding the business, affairs and financial condition of the Company and its subsidiaries as the Agent shall reasonably request.

(c) Use of Proceeds. The proceeds of any Loan may be used only (x) in the case of any Loan other than the Default Termination Loan, to satisfy a Senior Priority Payment identified by FSAM or FSA in accordance with the provisions Section 11.2(a) or (b) of the Pledge and Administration Agreement at or prior to the request for such Loan or (y) in the case of the Default Termination Loan, to be applied to Senior Priority Payments or to purchase Permitted Investments to be held by the Collateral Agent under the Pledge and Administration Agreement and subsequently applied to Senior Priority Payments.

(d) Margin Stock. None of the proceeds of the Loans will be used directly or indirectly for the purpose (whether immediate, incidental or ultimate) of buying or carrying any “margin stock” within the meaning of Regulation U of the Board of Governors of the Federal Reserve System.

(e) Maintenance of Properties. The Company shall (a) maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted; and (b) use the standard of care typical in the industry in the operation and maintenance of its facilities, except where the failure to do so could not reasonably be expected to have a material adverse effect on the Company.

(f) Maintenance of Insurance. The Company shall maintain with financially sound and reputable insurance companies or with a captive insurance company that is an affiliate of the Company as to which the Banks may request reasonable evidence of financial responsibility, insurance with respect to its properties in such amounts with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Company or any of its subsidiaries operates.

ARTICLE V

MISCELLANEOUS

Section 5.01 Amendments and Waivers . No failure or delay on the part of the Banks in exercising any power or right hereunder or under the Note shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power preclude any other or further exercise thereof or the exercise of any other right or power hereunder. No amendment, modification, supplement, termination or waiver of any provision of this Agreement or the Note nor consent to any departure by the Company herefrom or therefrom shall in any event be effective unless the same shall be in writing and signed by the Agent, the Banks, the Company and FSA. Any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. No notice to or demand on the Company in any case shall, of itself, entitle the Company to any other or further notice or demand in similar or other circumstances. Notwithstanding the foregoing, any amendment, modification, supplement, termination or waiver of any provision of this Agreement or the Note entered into by the Banks and the Company without the prior written consent of FSA shall be void ab initio .

Section 5.02 Third Party Beneficiary . Each of FSA and the Collateral Agent shall be a third party beneficiary of the provisions of this Agreement setting forth rights of FSA or the Collateral Agent, respectively.

Section 5.03 Notices . Any communication, demand, or notice to be given to a person hereunder will be duly given and deemed to have been received when actually delivered (or 72 hours after having been deposited in the mails with first class postage prepaid) to such person at the address specified in this Section 5.03 or on the signature pages hereof (or at such other address as such person shall specify to the other notice parties in writing), including delivery by telex, telecopier, e-mail or other telecommunication device capable of transmitting or creating a written record. The Agent may (but shall not be required to) accept and act upon oral, telephonic or other forms of notices or instructions hereunder that the Banks reasonably believe in good faith to have been given by a person authorized to do so on behalf of the person delivering such notice or instruction. The Banks shall be fully protected and held harmless by the Company, and shall have no liability, for acting on any such notice or instruction that the Banks reasonably believe in good faith to have been given by a person authorized to do so. The Agent and the Company shall send a copy of any notice hereunder to Assured at 1325 Avenue of the Americas, New York, New York 10019, Attention: General Counsel, Re: Dexia FP Liquidity, Email: generalcounsel@assuredguaranty.com, Fax: (212) 445-8705, to Financial Security Assurance Inc., 31 West 52 nd Street, New York, New York 10019; Attention: General Counsel; Re: Dexia FP Liquidity; Email: generalcounsel@fsa.com, Fax: (212) 339-3529, to the Collateral Agent at The Bank of New York Mellon Trust Company, National Association, 601 Travis Street, 16 th Floor, Houston, TX 77002, Attention: Global Corporate Trust - Dexia Financial Products Collateral Agent, Telephone: (713) 483-6000, Telecopy No.: (713) 483-6656, Email: FSA_Dexia_Assured@bnymellon.com, to DCL at Dexia Crédit Local, Tour Dexia La Défense 2, 1, Passerelle des Reflets, TSA 92202, 92919 La Défense Cedex, Attention : Back-Office Department, Telephone No : + 00 33 1 58 58 68 92, Facsimile No : + 00 33 1 58 58 72 70, Email: dominique.brossard@dexia.com and Dexia Crédit Local S.A., 1, Passerelle des Reflets, Tour Dexia La Défense 2, 92919 La Défense Cedex, France, Attention: Francois Laugier,

Finance Department, Facsimile: +33 1 58 58 58 60, Email: francois.laugier@dexia.com, DBB at Dexia Bank Belgium SA, Boulevard Pachéco 44, 1000 Brussels, Belgium, Attn.: Back Office — Operations Derivatives FX — MM, Telecopy: +32-2-222.81.45, Email: TLX-USXAV.BE@dexia.com; Patrick.VanUytvanck@dexia.com; Sandra.Clement@dexia.com, with copies to (i) TFM — Cash & Liquidity Management, Attn. Peter De Poorter, Telecopy: +32-2-222.28.92, E-mail: Peter.Depoorter@dexia.com and (ii) TFM — GFI, Attn. Vincent De Caluwe, Telecopy: +32-2-285.14.42, E-mail: Vincent.DeCaluwe@dexia.com and to the Administrator at HF Services LLC, 445 Park Avenue, 5 th Floor, New York, New York 10022, Attention: FP — Operations; Re: Dexia FP Liquidity; Email: ops@hfservicesllc.com, Fax: (212) 893-2717. Any communication, demand, or notice to be given to the Agent shall be sent to each of (i) Dexia Crédit Local New York Branch, 445 Park Avenue, 8 th floor, New York, New York 10022, Attention: Back Office Operations; Re: Dexia FP Liquidity; Email: backoffice@dexia-us.com, Fax: (212) 753-7522 and (ii) HF Services LLC, prior to July 27, 2009 to 31 West 52nd Street, New York, NY 10019, Attention: FP Operations, Telephone: (212) 893-2700, Fax: (212) 893-2717, Email: gicops@fsa.com, and on and after July 27, 2009 to 445 Park Avenue, 5th Floor, New York, NY 10022, Attention: FP Operations, Telephone: (212) 893-2700, Fax: (212) 893-2717, Email: ops@hfservicesllc.com. Any communication, demand, or notice to be given to the Company shall be sent c/o HF Services LLC, prior to July 27, 2009 to 31 West 52nd Street, New York, NY 10019, Attention: FP Operations, Telephone: (212) 893-2700, Fax: (212) 893-2717, Email: gicops@fsa.com, and on and after July 27, 2009 to 445 Park Avenue, 5th Floor, New York, NY 10022, Attention: FP Operations, Telephone: (212) 893-2700, Fax: (212) 893-2717, Email: ops@hfservicesllc.com.

Section 5.04 Successors and Assigns. This Agreement shall inure to the benefit of, and shall be enforceable by, the parties hereto and their respective successors and permitted assigns. Neither this Agreement nor any interest or obligation in or under this Agreement may be assigned or transferred (whether by way of security or otherwise) by the Banks (other than for DBB to make an assignment and transfer to DCL or DCL to make an assignment and transfer to DBB) without the consent of the Company and FSA, other than

(I) pursuant to a consolidation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (a “ Corporate Reorganization ”), provided that the Remedies Nonimpairment Condition (as defined in the Pledge and Administration Agreement) is satisfied in relation to such Corporate Reorganization; or

(II) pursuant to an assignment of its rights and obligations hereunder in whole or in part by any Bank (the “ Assigning Bank ”) to an Affiliate of such Bank (a “ Transferee Bank ”) where (i)(a) such Transferee Bank has a rating assigned by Moody’s to its long-term indebtedness and its short-term indebtedness at least as high as the rating assigned by Moody’s to the long-term indebtedness and short-term indebtedness of the Assigning Bank, and (b) such Transferee Bank has a rating assigned by S&P to its long-term indebtedness and its short-term indebtedness at least as high as the rating assigned by S&P to the long-term indebtedness and short-term indebtedness of the Assigning Bank, in each case on the date of the proposed assignment, (ii) the Assigning Bank receives confirmation from Moody’s and S&P that none of the ratings of the Transferee Bank referred to in clause (i) above will be reduced or withdrawn after giving effect to the proposed assignment (or if reduced, will

be reduced to a rating subcategory not lower than the corresponding rating subcategory of the Assigning Bank (and for this purpose a rating of the same subcategory which is on negative watch or watch for downgrade shall be considered lower than a rating of the same subcategory that is not on negative watch or watch for downgrade)), (iii) if the Transferee Bank would be located in a different jurisdiction than the Assigning Bank (and is not located in Belgium or France), the Remedies Nonimpairment Condition is satisfied in relation to such assignment, (iv) the relevant Bank Commitment of the Assigning Bank is $1.5 billion or less at the time of such assignment and (v) after giving effect to such assignment there would be no more than three different Banks having a separate Bank Commitment hereunder.

Upon any assignment contemplated by (II), Schedule A will be amended to reflect such assignment. The Company may not assign or otherwise transfer any of its rights or obligations under this Agreement or the Note without the prior written consent of the Banks, and any purported assignment without such consent shall be void. The Agent may assign its rights and obligations hereunder to any Bank upon notice to the Banks, the Company and FSA.

Section 5.05 Costs, Expenses and Taxes. The Company agrees to pay on demand all costs and expenses of the Banks, including reasonable fees and expenses of counsel, in connection with the enforcement against it of this Agreement and the Note and the protection of the Banks’ rights hereunder and thereunder, including any bankruptcy, insolvency, enforcement proceedings or restructuring with respect to the Company, in each case subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein. In addition, the Company shall pay any and all stamp and other taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Agreement and the Note, and agrees to save the Banks harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees, in each case subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein.

Section 5.06 Acknowledgement of Security Interests . Each of the Agent and the Banks hereby acknowledge that the Company is granting a security interest in its rights under this Agreement to the Collateral Agent on behalf of the Secured Parties (including FSA) to secure its obligations under the Pledge and Administration Agreement and the Transactions Documents, and each of the Banks hereby consents to any transfer of any or all of such rights in connection with the enforcement of such security interests.

Section 5.07 Governing Law . THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK AND THE MANDATORY CHOICE OF LAW RULES CONTAINED IN THE UCC. Each of the parties hereto hereby irrevocably submits to the exclusive jurisdiction of any U.S. federal or state court in The City of New York for the purpose of any suit, action, proceeding or judgment arising out of or relating to this Agreement. Each of the parties hereto

hereby consents to the laying of venue in any such suit, action or proceeding in New York County, New York, and hereby irrevocably waives any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum and agrees not to plead or claim the same. Notwithstanding the foregoing, nothing contained in this Agreement shall limit or affect the rights of any party hereto to exercise remedies under this Agreement or any of the other Transaction Documents, or to enforce any judgment with respect thereto, in any jurisdiction or venue. Any process in any such action shall be duly served if mailed by registered mail, postage prepaid, with respect to (i) the Company, at its address designated pursuant to Section 5.03 and (ii) with respect to the Banks, each of DBB and DCL hereby irrevocably appoints Dexia Crédit Local New York Branch (the “ Process Agent ”), with an office at 445 Park Avenue, 5 th Floor, New York, NY 10022, as their agent to receive, on behalf of the Banks and their respective property, service of copies of the summons and complaint and any other process which may be served in any such action or proceeding. Such service may be made by mailing or delivering a copy of such process to the Banks in care of the Process Agent at the Process Agent’s above address, and DBB and DCL hereby irrevocably authorizes and directs the Process Agent to accept such service on their behalf. The Banks may appoint a replacement Process Agent with an office in the State of New York by notice to FSA.

Section 5.08 Counterparts . This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if all signatures thereon were upon the same instrument. This Agreement and the Note constitute the entire agreement and understanding between the Company and the Banks with respect to the subject matter hereof, and supersede any prior agreements and understandings with respect thereto.

Section 5.09 WAIVER OF JURY TRIAL . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION.

Section 5.10 Sovereign Immunity . To the extent that the parties hereto, or any of their respective properties, assets or revenues may have or may hereafter become entitled to, or have attributed to them, any right of immunity, on the grounds of sovereignty or otherwise, from any legal action, suit or proceeding, from the giving of any relief in any respect thereof, from setoff or counterclaim, from the jurisdiction of any court, from service of process, from attachment upon or prior to judgment, from attachment in aid of execution of judgment, or from execution of judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which proceedings may at any time be commenced, with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Agreement, the parties hereto hereby irrevocably and unconditionally waive, and agree not to plead or claim, to the fullest extent permitted by applicable law, any such immunity and consent to such relief and enforcement.

Section 5.11 PATRIOT ACT . The Banks hereby notify the Company that, pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is required to obtain, verify and record information that identifies the

Company, which information includes the name and address of the Company and other information that will allow the Banks to identify the Company in accordance with the Act.

Section 5.12 Non-Petition . Each Bank agrees that it will not, prior to the Senior Release Date, acquiesce, petition or otherwise institute against, or join any other person in instituting against, the Company, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy, or similar law, including without limitations proceedings seeking to appoint a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Company or any substantial part of its property; provided , that this provision shall not restrict or prohibit the Banks from joining any such proceedings which shall have already commenced under applicable laws and not in violation of this provision. This provision shall survive the termination of this Agreement for any reason.

Section 5.13 Limited Recourse . The obligations of the Company in relation to this Agreement and any Loan hereunder are limited recourse obligations, payable solely from the proceeds of the FSAM Collateral available under and applied in accordance with the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) subject to the satisfaction of the Subordinated Claims Payment Condition specified therein. Upon application of the FSAM Collateral and proceeds thereof available to satisfy the obligations of the Company hereunder in accordance with the Pledge and Administration Agreement, the Banks shall not be entitled to take any further steps against the Company to recover any sums due and shall not constitute a claim against the Company to the extent of any insufficiency. No recourse shall be had for the payment of any amounts owing in respect of this Agreement against any officer, director, employee, stockholder, member or incorporator of the Company. The Banks shall have no right to commence or maintain any action, suit or proceeding against the Company arising out of any breach of this Agreement by the Company for any reason, but such provision shall be without prejudice to the rights of the Banks, at any time FSA is the Secured Party Representative, to its rights to indemnification in accordance with Section 2.02(c).

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first above written.

	FSA Asset Management LLC
	445 Park Avenue, 5 th Floor
	New York, NY 10022
	Attn.:		FP – Operations
	Telephone:		(212) 893-2700
	Fax:		(212) 893-2717
	Email:		ops@hfservicesllc.com


	By:
	Name:
	Title:

A&R Revolving Credit Agreement

	In its capacity as a Bank and, with respect to its New York Branch, as Agent under the Agreement:

	Dexia Crédit Local S.A.
	1, Passerelle des Reflets
	Tour Dexia La Défense 2
	92913 La Défense Cedex
	France
	Attn.:		Back Office Operations
	Telephone:		33 1 58 58 72 09
			33 1 58 58 68 92
	Telecopy:		33 1 58 58 72 90
	Email:		laurent.fritsch@dexia.com


	By:
	Name:
	Title:

A&R Revolving Credit Agreement

	In its capacity as a Bank:

	Dexia Bank Belgium SA
	Boulevard Pachéco 44
	1000 Brussels Belgium


	By:
	Name:
	Title:

A&R Revolving Credit Agreement

SCHEDULE A

First Tranche Commitment

Bank	Commitment

Dexia Crédit Local S.A.	$	600,000,000

Dexia Bank Belgium SA	$	4,400,000,000

Second Tranche Commitment

Bank	Commitment

Dexia Crédit Local S.A.	$	3,000,000,000

S-1

Exhibit 10.2.1

Master Repurchase Agreement

September 1996 Version

Dated as of	June 30, 2009

Between:	Dexia Crédit Local S.A.

and	FSA Asset Management LLC

1. Applicability

From time to time the parties hereto may enter into transactions in which one party (“Seller”) agrees to transfer to the other (“Buyer”) securities or other assets (“Securities”) against the transfer of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such Securities at a date certain or on demand, against the transfer of funds by Seller. Each such transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be governed by this Agreement, including any supplemental terms or conditions contained in Annex I hereto and in any other annexes identified herein or therein as applicable hereunder.

2. Definitions

(a) “Act of Insolvency”, with respect to any party, (i) the commencement by such party as debtor of any case or proceeding under any bankruptcy, insolvency, reorganization, liquidation, moratorium, dissolution, delinquency or similar law, or such party seeking the appointment or election of a receiver, conservator, trustee, custodian or similar official for such party or any substantial part of its property, or the convening of any meeting of creditors for purposes of commencing any such case or proceeding or seeking such an appointment or election, (ii) the commencement of any such case or proceeding against such party, or another seeking such an appointment or election, or the filing against a party of an application for a protective decree under the provisions of the Securities Investor Protection Act of 1970, which (A) is consented to or not timely contested by such party, (B) results in the entry of an order for relief, such an appointment or election, the issuance of such a protective decree or the entry of an order having a similar effect, or (C) is not dismissed within 15 days, (iii) the making by such party of a general assignment for the benefit of creditors, or (iv) the admission in writing by such party of such party’s inability to pay such party’s debts as they become due;

(b) “Additional Purchased Securities”, Securities provided by Seller to Buyer pursuant to Paragraph 4(a) hereof;

(c) “Buyer’s Margin Amount”, with respect to any Transaction as of any date, the amount obtained by application of the Buyer’s Margin Percentage to the Repurchase Price for such Transaction as of such date;

(d) “Buyer’s Margin Percentage”, with respect to any Transaction as of any date, a percentage (which may be equal to the Seller’s Margin Percentage) agreed to by Buyer and Seller or, in the absence of any such agreement, the percentage obtained by dividing the Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the Purchase Date for such Transaction;

(e) “Confirmation”, the meaning specified in Paragraph 3(b) hereof;

(f) “Income”, with respect to any Security at any time, any principal thereof and all interest, dividends or other distributions thereon;

(g) “Margin Deficit”, the meaning specified in Paragraph 4(a) hereof;

(h) “Margin Excess”, the meaning specified in Paragraph 4(b) hereof;

(i) “Margin Notice Deadline”, the time agreed to by the parties in the relevant Confirmation, Annex I hereto or otherwise as the deadline for giving notice requiring same-day satisfaction of margin maintenance obligations as provided in Paragraph 4 hereof (or, in the absence of any such agreement, the deadline for such purposes established in accordance with market practice);

(j) “Market Value”, with respect to any Securities as of any date, the price for such Securities on such date obtained from a generally recognized source agreed to by the parties or the most recent closing bid quotation from such a source, plus accrued Income to the extent not included therein (other than any Income credited or transferred to, or applied to the obligations of, Seller pursuant to Paragraph 5 hereof) as of such date (unless contrary to market practice for such Securities);

(k) “Price Differential”, with respect to any Transaction as of any date, the aggregate amount obtained by daily application of the Pricing Rate for such Transaction to the Purchase Price for such Transaction on a 360 day per year basis for the actual number of days during the period commencing on (and including) the Purchase Date for such Transaction and ending on (but excluding) the date of determination (reduced by any amount of such Price Differential previously paid by Seller to Buyer with respect to such Transaction);

(l) “Pricing Rate”, the per annum percentage rate for determination of the Price Differential;

(m) “Prime Rate”, the prime rate of U.S. commercial banks as published in The Wall Street Journal (or, if more than one such rate is published, the average of such rates);

(n) “Purchase Date”, the date on which Purchased Securities are to be transferred by Seller to Buyer;

(o) “Purchase Price”, (i) on the Purchase Date, the price at which Purchased Securities are transferred by Seller to Buyer, and (ii) thereafter, except where Buyer and Seller agree otherwise, such price increased by the amount of any cash transferred by Buyer to Seller pursuant to Paragraph 4(b) hereof and decreased by the amount of any cash transferred by Seller to Buyer pursuant to Paragraph 4(a) hereof or applied to reduce Seller’s obligations under clause (ii) of Paragraph 5 hereof;

(p) “Purchased Securities”, the Securities transferred by Seller to Buyer in a Transaction hereunder, and any Securities substituted therefor in accordance with Paragraph 9 hereof. The term “Purchased Securities” with respect to any Transaction at any time also shall include Additional Purchased Securities delivered pursuant to Paragraph 4(a) hereof and shall exclude Securities returned pursuant to Paragraph 4(b) hereof;

(q) “Repurchase Date”, the date on which Seller is to repurchase the Purchased Securities from Buyer, including any date determined by application of the provisions of Paragraph 3(c) or 11 hereof;

(r) “Repurchase Price”, the price at which Purchased Securities are to be transferred from Buyer to Seller upon termination of a Transaction, which will be determined in each case (including Transactions terminable upon demand) as the sum of the Purchase Price and the Price Differential as of the date of such determination;

(s) “Seller’s Margin Amount”, with respect to any Transaction as of any date, the amount obtained by application of the Seller’s Margin Percentage to the Repurchase Price for such Transaction as of such date;

(t) “Seller’s Margin Percentage”, with respect to any Transaction as of any date, a percentage (which may be equal to the Buyer’s Margin Percentage) agreed to by Buyer and Seller or, in the absence of any such agreement, the percentage obtained by dividing the Market Value of the Purchased Securities on the Purchase Date by the Purchase Price on the Purchase Date for such Transaction.

3. Initiation; Confirmation; Termination

(a) An agreement to enter into a Transaction may be made orally or in writing at the initiation of either Buyer or Seller. On the Purchase Date for the Transaction, the Purchased Securities shall be transferred to Buyer or its agent against the transfer of the Purchase Price to an account of Seller.

(b) Upon agreeing to enter into a Transaction hereunder, Buyer or Seller (or both), as shall be agreed, shall promptly deliver to the other party a written confirmation of each Transaction (a “Confirmation”). The Confirmation shall describe the Purchased Securities (including CUSIP number, if any), identify Buyer and Seller and set forth (i) the Purchase Date, (ii) the Purchase Price, (iii) the Repurchase Date, unless the Transaction is to be terminable on demand, (iv) the Pricing Rate or Repurchase Price applicable to the Transaction, and (v) any additional terms or conditions of the Transaction not inconsistent with this Agreement. The Confirmation, together with this Agreement, shall constitute conclusive evidence of the terms agreed between Buyer and Seller with respect to the Transaction to which the Confirmation relates, unless with

respect to the Confirmation specific objection is made promptly after receipt thereof. In the event of any conflict between the terms of such Confirmation and this Agreement, this Agreement shall prevail.

(c) In the case of Transactions terminable upon demand, such demand shall be made by Buyer or Seller, no later than such time as is customary in accordance with market practice, by telephone or otherwise on or prior to the business day on which such termination will be effective. On the date specified in such demand, or on the date fixed for termination in the case of Transactions having a fixed term, termination of the Transaction will be effected by transfer to Seller or its agent of the Purchased Securities and any Income in respect thereof received by Buyer (and not previously credited or transferred to, or applied to the obligations of, Seller pursuant to Paragraph 5 hereof) against the transfer of the Repurchase Price to an account of Buyer.

4. Margin Maintenance

(a) If at any time the aggregate Market Value of all Purchased Securities subject to all Transactions in which a particular party hereto is acting as Buyer is less than the aggregate Buyer’s Margin Amount for all such Transactions (a “Margin Deficit”), then Buyer may by notice to Seller require Seller in such Transactions, at Seller’s option, to transfer to Buyer cash or additional Securities reasonably acceptable to Buyer (“Additional Purchased Securities”), so that the cash and aggregate Market Value of the Purchased Securities, including any such Additional Purchased Securities, will thereupon equal or exceed such aggregate Buyer’s Margin Amount (decreased by the amount of any Margin Deficit as of such date arising from any Transactions in which such Buyer is acting as Seller).

(b) If at any time the aggregate Market Value of all Purchased Securities subject to all Transactions in which a particular party hereto is acting as Seller exceeds the aggregate Seller’s Margin Amount for all such Transactions at such time (a “Margin Excess”), then Seller may by notice to Buyer require Buyer in such Transactions, at Buyer’s option, to transfer cash or Purchased Securities to Seller, so that the aggregate Market Value of the Purchased Securities, after deduction of any such cash or any Purchased Securities so transferred, will thereupon not exceed such aggregate Seller’s Margin Amount (increased by the amount of any Margin Excess as of such date arising from any Transactions in which such Seller is acting as Buyer).

(c) If any notice is given by Buyer or Seller under subparagraph (a) or (b) of this Paragraph at or before the Margin Notice Deadline on any business day, the party receiving such notice shall transfer cash or Additional Purchased Securities as provided in such subparagraph no later than the close of business in the relevant market on such day. If any such notice is given after the Margin Notice Deadline, the party receiving such notice shall transfer such cash or Securities no later than the close of business in the relevant market on the next business day following such notice.

(d) Any cash transferred pursuant to this Paragraph shall be attributed to such Transactions as shall be agreed upon by Buyer and Seller.

(e) Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the respective rights of Buyer or Seller (or both) under subparagraphs (a) and (b) of this Paragraph may be exercised only where a Margin Deficit or Margin Excess, as the case may be, exceeds a specified dollar amount or a specified percentage of the Repurchase Prices for such Transactions (which amount or percentage shall be agreed to by Buyer and Seller prior to entering into any such Transactions).

(f) Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the respective rights of Buyer and Seller under subparagraphs (a) and (b) of this Paragraph to require the elimination of a Margin Deficit or a Margin Excess, as the case may be, may be exercised whenever such a Margin Deficit or Margin Excess exists with respect to any single Transaction hereunder (calculated without regard to any other Transaction outstanding under this Agreement).

5. Income Payments

Seller shall be entitled to receive an amount equal to all Income paid or distributed on or in respect of the Securities that is not otherwise received by Seller, to the full extent it would be so entitled if the Securities had not been sold to Buyer. Buyer shall, as the parties may agree with respect to any Transaction (or, in the absence of any such agreement, as Buyer shall reasonably determine in its discretion), on the date such Income is paid or distributed either (i) transfer to or credit to the account of Seller such Income with respect to any Purchased Securities subject to such Transaction or (ii) with respect to Income paid in cash, apply the Income payment or payments to reduce the amount, if any, to be transferred to Buyer by Seller upon termination of such Transaction. Buyer shall not be obligated to take any action pursuant to the preceding sentence (A) to the extent that such action would result in the creation of a Margin Deficit, unless prior thereto or simultaneously therewith Seller transfers to Buyer cash or Additional Purchased Securities sufficient to eliminate such Margin Deficit, or (B) if an Event of Default with respect to Seller has occurred and is then continuing at the time such Income is paid or distributed.

6. Security Interest

Although the parties intend that all Transactions hereunder be sales and purchases and not loans, in the event any such Transactions are deemed to be loans, Seller shall be deemed to have pledged to Buyer as security for the performance by Seller of its obligations under each such Transaction, and shall be deemed to have granted to Buyer a security interest in, all of the Purchased Securities with respect to all Transactions hereunder and all Income thereon and other proceeds thereof.

7. Payment and Transfer

Unless otherwise mutually agreed, all transfers of funds hereunder shall be in immediately available funds. All Securities transferred by one party hereto to the other party (i) shall be in suitable form for transfer or shall be accompanied by duly executed instruments of transfer or assignment in blank and such other documentation as the party receiving possession may reasonably request, (ii) shall be transferred on the book-entry system of a Federal Reserve Bank, or (iii) shall be transferred by any other method mutually acceptable to Seller and Buyer.

8. Segregation of Purchased Securities

To the extent required by applicable law, all Purchased Securities in the possession of Seller shall be segregated from other securities in its possession and shall be identified as subject to this Agreement. Segregation may be accomplished by appropriate identification on the books and records of the holder, including a financial or securities intermediary or a clearing corporation. All of Seller’s interest in the Purchased Securities shall pass to Buyer on the Purchase Date and, unless otherwise agreed by Buyer and Seller, nothing in this Agreement shall preclude Buyer from engaging in repurchase transactions with the Purchased Securities or otherwise selling, transferring, pledging or hypothecating the Purchased Securities, but no such transaction shall relieve Buyer of its obligations to transfer Purchased Securities to Seller pursuant to Paragraph 3, 4 or 11 hereof, or of Buyer’s obligation to credit or pay Income to, or apply Income to the obligations of, Seller pursuant to Paragraph 5 hereof.

Required Disclosure for Transactions in Which the Seller Retains Custody of the Purchased Securities

Seller is not permitted to substitute other securities for those subject to this Agreement and therefore must keep Buyer’s securities segregated at all times, unless in this Agreement Buyer grants Seller the right to substitute other securities. If Buyer grants the right to substitute, this means that Buyer’s securities will likely be commingled with Seller’s own securities during the trading day. Buyer is advised that, during any trading day that Buyer’s securities are commingled with Seller’s securities, they [will]* [may]** be subject to liens granted by Seller to [its clearing bank]* [third parties]** and may be used by Seller for deliveries on other securities transactions. Whenever the securities are commingled, Seller’s ability to resegregate substitute securities for Buyer will be subject to Seller’s ability to satisfy [the clearing]* [any]** lien or to obtain substitute securities.

* Language to be used under 17 C.F.R. ß403.4(e) if Seller is a government securities broker or dealer other than a financial institution.

** Language to be used under 17 C.F.R. ß403.5(d) if Seller is a financial institution.

9. Substitution

(a) Seller may, subject to agreement with and acceptance by Buyer, substitute other Securities for any Purchased Securities. Such substitution shall be made by transfer to Buyer of such other Securities and transfer to Seller of such Purchased Securities. After substitution, the substituted Securities shall be deemed to be Purchased Securities.

(b) In Transactions in which Seller retains custody of Purchased Securities, the parties expressly agree that Buyer shall be deemed, for purposes of subparagraph (a) of this Paragraph, to have agreed to and accepted in this Agreement substitution by Seller of other Securities for Purchased Securities; provided, however, that such other Securities shall have a Market Value at least equal to the Market Value of the Purchased Securities for which they are substituted.

10. Representations

Each of Buyer and Seller represents and warrants to the other that (i) it is duly authorized to execute and deliver this Agreement, to enter into Transactions contemplated hereunder and to perform its obligations hereunder and has taken all necessary action to authorize such execution, delivery and performance, (ii) it will engage in such Transactions as principal (or, if agreed in writing, in the form of an annex hereto or otherwise, in advance of any Transaction by the other party hereto, as agent for a disclosed principal), (iii) the person signing this Agreement on its behalf is duly authorized to do so on its behalf (or on behalf of any such disclosed principal), (iv) it has obtained all authorizations of any governmental body required in connection with this Agreement and the Transactions hereunder and such authorizations are in full force and effect and (v) the execution, delivery and performance of this Agreement and the Transactions hereunder will not violate any law, ordinance, charter, bylaw or rule applicable to it or any agreement by which it is bound or by which any of its assets are affected. On the Purchase Date for any Transaction Buyer and Seller shall each be deemed to repeat all the foregoing representations made by it.

11. Events of Default

In the event that (i) Seller fails to transfer or Buyer fails to purchase Purchased Securities upon the applicable Purchase Date, (ii) Seller fails to repurchase or Buyer fails to transfer Purchased Securities upon the applicable Repurchase Date, (iii) Seller or Buyer fails to comply with Paragraph 4 hereof, (iv) Buyer fails, after one business day’s notice, to comply with Paragraph 5 hereof, (v) an Act of Insolvency occurs with respect to Seller or Buyer, (vi) any representation made by Seller or Buyer shall have been incorrect or untrue in any material respect when made or repeated or deemed to have been made or repeated, or (vii) Seller or Buyer shall admit to the other its inability to, or its intention not to, perform any of its obligations hereunder (each an “Event of Default”):

(a) The nondefaulting party may, at its option (which option shall be deemed to have been exercised immediately upon the occurrence of an Act of Insolvency), declare an Event of Default to have occurred hereunder and, upon the exercise or deemed exercise of such option, the Repurchase Date for each Transaction hereunder shall, if it has not already occurred, be deemed immediately to occur (except that, in the event that the Purchase Date for any Transaction has not yet occurred as of the date of such exercise or deemed exercise, such Transaction shall be deemed immediately canceled). The nondefaulting party shall (except upon the occurrence of an Act of Insolvency) give notice to the defaulting party of the exercise of such option as promptly as practicable.

(b) In all Transactions in which the defaulting party is acting as Seller, if the nondefaulting party exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, (i) the defaulting party’s obligations in such Transactions to repurchase all Purchased Securities, at the Repurchase Price therefor on the Repurchase Date determined in accordance with subparagraph (a) of this Paragraph, shall thereupon become immediately due and payable, (ii) all Income paid after such exercise or deemed exercise shall be retained by the nondefaulting party and applied to the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder, and (iii) the defaulting party shall immediately deliver to the nondefaulting party any Purchased Securities subject to such Transactions then in the defaulting party’s possession or control.

(c) In all Transactions in which the defaulting party is acting as Buyer, upon tender by the nondefaulting party of payment of the aggregate Repurchase Prices for all such Transactions, all right, title and interest in and entitlement to all Purchased Securities subject to such Transactions shall be deemed transferred to the nondefaulting party, and the defaulting party shall deliver all such Purchased Securities to the nondefaulting party.

(d) If the nondefaulting party exercises or is deemed to have exercised the option referred to in subparagraph (a) of this Paragraph, the nondefaulting party, without prior notice to the defaulting party, may:

(i) as to Transactions in which the defaulting party is acting as Seller, (A) immediately sell, in a recognized market (or otherwise in a commercially reasonable manner) at such price or prices as the nondefaulting party may reasonably deem satisfactory, any or all Purchased Securities subject to such Transactions and apply the proceeds thereof to the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder or (B) in its sole discretion elect, in lieu of selling all or a portion of such Purchased Securities, to give the defaulting party credit for such Purchased Securities in an amount equal to the price therefor on such date, obtained from a generally recognized source or the most recent closing bid quotation from such a source, against the aggregate unpaid Repurchase Prices and any other amounts owing by the defaulting party hereunder; and

(ii) as to Transactions in which the defaulting party is acting as Buyer, (A) immediately purchase, in a recognized market (or otherwise in a commercially reasonable manner) at such price or prices as the nondefaulting party may reasonably deem satisfactory, securities (“Replacement Securities”) of the same class and amount as any Purchased Securities that are not delivered by the defaulting party to the nondefaulting party as required hereunder or (B) in its sole discretion elect, in lieu of purchasing Replacement Securities, to be deemed to have purchased Replacement Securities at the price therefor on such date, obtained from a generally recognized source or the most recent closing offer quotation from such a source.

Unless otherwise provided in Annex I, the parties acknowledge and agree that (1) the Securities subject to any Transaction hereunder are instruments traded in a recognized market, (2) in the absence of a generally recognized source for prices or bid or offer quotations for any Security, the nondefaulting party may establish the source therefor in its sole discretion and (3) all prices, bids and offers shall be determined together with accrued Income (except to the extent contrary to market practice with respect to the relevant Securities).

(e) As to Transactions in which the defaulting party is acting as Buyer, the defaulting party shall be liable to the nondefaulting party for any excess of the price paid (or deemed paid) by the nondefaulting party for Replacement Securities over the Repurchase Price for the Purchased Securities replaced thereby and for any amounts payable by the defaulting party under Paragraph 5 hereof or otherwise hereunder.

(f) For purposes of this Paragraph 11, the Repurchase Price for each Transaction hereunder in respect of which the defaulting party is acting as Buyer shall not increase above the

amount of such Repurchase Price for such Transaction determined as of the date of the exercise or deemed exercise by the nondefaulting party of the option referred to in subparagraph (a) of this Paragraph.

(g) The defaulting party shall be liable to the nondefaulting party for (i) the amount of all reasonable legal or other expenses incurred by the nondefaulting party in connection with or as a result of an Event of Default, (ii) damages in an amount equal to the cost (including all fees, expenses and commissions) of entering into replacement transactions and entering into or terminating hedge transactions in connection with or as a result of an Event of Default, and (iii) any other loss, damage, cost or expense directly arising or resulting from the occurrence of an Event of Default in respect of a Transaction.

(h) To the extent permitted by applicable law, the defaulting party shall be liable to the nondefaulting party for interest on any amounts owing by the defaulting party hereunder, from the date the defaulting party becomes liable for such amounts hereunder until such amounts are (i) paid in full by the defaulting party or (ii) satisfied in full by the exercise of the nondefaulting party’s rights hereunder. Interest on any sum payable by the defaulting party to the nondefaulting party under this Paragraph 11(h) shall be at a rate equal to the greater of the Pricing Rate for the relevant Transaction or the Prime Rate.

(i) The nondefaulting party shall have, in addition to its rights hereunder, any rights otherwise available to it under any other agreement or applicable law.

12. Single Agreement

Buyer and Seller acknowledge that, and have entered hereinto and will enter into each Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions hereunder constitute a single business and contractual relationship and have been made in consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to perform all of its obligations in respect of each Transaction hereunder, and that a default in the performance of any such obligations shall constitute a default by it in respect of all Transactions hereunder, (ii) that each of them shall be entitled to set off claims and apply property held by them in respect of any Transaction against obligations owing to them in respect of any other Transactions hereunder and (iii) that payments, deliveries and other transfers made by either of them in respect of any Transaction shall be deemed to have been made in consideration of payments, deliveries and other transfers in respect of any other Transactions hereunder, and the obligations to make any such payments, deliveries and other transfers may be applied against each other and netted.

13. Notices and Other Communications

Any and all notices, statements, demands or other communications hereunder may be given by a party to the other by mail, facsimile, telegraph, messenger or otherwise to the address specified in Annex II hereto, or so sent to such party at any other place specified in a notice of change of address hereafter received by the other. All notices, demands and requests hereunder may be made orally, to be confirmed promptly in writing, or by other communication as specified in the preceding sentence.

14. Entire Agreement; Severability

This Agreement shall supersede any existing agreements between the parties containing general terms and conditions for repurchase transactions. Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.

15. Non-assignability; Termination

(a) The rights and obligations of the parties under this Agreement and under any Transaction shall not be assigned by either party without the prior written consent of the other party, and any such assignment without the prior written consent of the other party shall be null and void. Subject to the foregoing, this Agreement and any Transactions shall be binding upon and shall inure to the benefit of the parties and their respective successors and assigns. This Agreement may be terminated by either party upon giving written notice to the other, except that this Agreement shall, notwithstanding such notice, remain applicable to any Transactions then outstanding.

(b) Subparagraph (a) of this Paragraph 15 shall not preclude a party from assigning, charging or otherwise dealing with all or any part of its interest in any sum payable to it under Paragraph 11 hereof.

16. Governing Law

This Agreement shall be governed by the laws of the State of New York without giving effect to the conflict of law principles thereof.

17. No Waivers, Etc.

No express or implied waiver of any Event of Default by either party shall constitute a waiver of any other Event of Default and no exercise of any remedy hereunder by any party shall constitute a waiver of its right to exercise any other remedy hereunder. No modification or waiver of any provision of this Agreement and no consent by any party to a departure here-from shall be effective unless and until such shall be in writing and duly executed by both of the parties hereto. Without limitation on any of the foregoing, the failure to give a notice pursuant to Paragraph 4(a) or 4(b) hereof will not constitute a waiver of any right to do so at a later date.

18. Use of Employee Plan Assets

(a) If assets of an employee benefit plan subject to any provision of the Employee Retirement Income Security Act of 1974 (“ERISA”) are intended to be used by either party hereto (the “Plan Party”) in a Transaction, the Plan Party shall so notify the other party prior to the Transaction. The Plan Party shall represent in writing to the other party that the Transaction does not constitute a prohibited transaction under ERISA or is otherwise exempt therefrom, and the other party may proceed in reliance thereon but shall not be required so to proceed.

(b) Subject to the last sentence of subparagraph (a) of this Paragraph, any such Transaction shall proceed only if Seller furnishes or has furnished to Buyer its most recent available audited statement of its financial condition and its most recent subsequent unaudited statement of its financial condition.

(c) By entering into a Transaction pursuant to this Paragraph, Seller shall be deemed (i) to represent to Buyer that since the date of Seller’s latest such financial statements, there has been no material adverse change in Seller’s financial condition which Seller has not disclosed to Buyer, and (ii) to agree to provide Buyer with future audited and unaudited statements of its financial condition as they are issued, so long as it is a Seller in any outstanding Transaction involving a Plan Party.

19. Intent

(a) The parties recognize that each Transaction is a “repurchase agreement” as that term is defined in Section 101 of Title 11 of the United States Code, as amended (except insofar as the type of Securities subject to such Transaction or the term of such Transaction would render such definition inapplicable), and a “securities contract” as that term is defined in Section 741 of Title 11 of the United States Code, as amended (except insofar as the type of assets subject to such Transaction would render such definition inapplicable).

(b) It is understood that either party’s right to liquidate Securities delivered to it in connection with Transactions hereunder or to exercise any other remedies pursuant to Paragraph 11 hereof is a contractual right to liquidate such Transaction as described in Sections 555 and 559 of Title 11 of the United States Code, as amended.

(c) The parties agree and acknowledge that if a party hereto is an “insured depository institution,” as such term is defined in the Federal Deposit Insurance Act, as amended (“FDIA”), then each Transaction hereunder is a “qualified financial contract,” as that term is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as the type of assets subject to such Transaction would render such definition inapplicable).

(d) It is understood that this Agreement constitutes a “netting contract” as defined in and subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and each payment entitlement and payment obligation under any Transaction hereunder shall constitute a “covered contractual payment entitlement” or “covered contractual payment obligation”, respectively, as defined in and subject to FDICIA (except insofar as one or both of the parties is not a “financial institution” as that term is defined in FDICIA).

20. Disclosure Relating to Certain Federal Protections

The parties acknowledge that they have been advised that:

(a) in the case of Transactions in which one of the parties is a broker or dealer registered with the Securities and Exchange Commission (“SEC”) under Section 15 of the Securities Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection Corporation has

taken the position that the provisions of the Securities Investor Protection Act of 1970 (“SIPA”) do not protect the other party with respect to any Transaction hereunder;

(b) in the case of Transactions in which one of the parties is a government securities broker or a government securities dealer registered with the SEC under Section 15C of the 1934 Act, SIPA will not provide protection to the other party with respect to any Transaction hereunder; and

(c) in the case of Transactions in which one of the parties is a financial institution, funds held by the financial institution pursuant to a Transaction hereunder are not a deposit and therefore are not insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, as applicable.

Dexia Crédit Local S.A.			FSA Asset Management LLC

By:			By:

Title:			Title:

Date:			Date:

Committed Term Repo Annex

Exhibit 10.2.2

EXECUTION VERSION

ANNEX 1 – COMMITTED TERM REPURCHASE AGREEMENT ANNEX

This Committed Term Repurchase Agreement Annex (this “Annex”) amends, supplements and forms a part of the Master Repurchase Agreement dated as of June 30, 2009 (the “Base Agreement”) between FSA Asset Management LLC (“FSAM” or “Seller”) and Dexia Crédit Local S.A. (“DCL” or “Buyer”). Capitalized terms used in the Base Agreement but separately defined herein have the meanings set forth herein and not those in the Base Agreement. Capitalized terms not defined herein have the meanings set forth in the Base Agreement or if not defined therein, in the Pledge and Administration Agreement identified below.

1. DEFINITIONS

“ Accelerated Downgrade Liquidity Draw Deadline ” means 9:00 A.M., New York City time, on the first Business Day after the date on which the relevant Accelerated Downgrade Liquidity Draw is deemed requested.

“ Additional Costs ” means amounts due and payable pursuant to Paragraph 10.

“ Agreement ” means the Base Agreement, as amended and supplemented by this Annex, and of which this Annex forms a part, together with each Confirmation hereunder from time to time.

“ Applicable Spread ” shall mean 0.90% per annum.

“ Authorized Account ” means the FSAM Cash Account.

“ Best Available Eligible Securities ” means those Eligible Securities owned by Seller and available to be transferred by Seller to Buyer in connection with this Agreement which fall into the highest of the Priority Categories specified on Schedule A and are transferred in accordance with Paragraph 3(b)(ii).

“ Business Day ” has the meaning specified in the Pledge and Administration Agreement and each reference to “business day” in the Base Agreement shall be a reference to a Business Day.

“ Buyer’s Margin Percentage ” means 100%.

“ Commitment Effective Date ” means June 30, 2009.

“ Commitment Fee Period ” shall mean each period commencing on and including one Commitment Fee Period End Date and ending on but excluding the next succeeding Commitment Fee Period End Date.

“ Commitment Fee Period End Date ” shall mean each of (i) the Commitment Effective Date (which shall be the first Commitment Fee Period End Date) and (ii) each date which is three calendar months after the immediately preceding Commitment Fee Period End Date; provided that the Facility Termination Date shall be the last Commitment Fee Period End Date.

“ Default Repo Termination Request ” has the meaning specified in Paragraph 3(b)(vii).

“ Dollars ” or “$” means the lawful currency of the United States of America.

“ Eligible Securities ” means the Put Portfolio Assets, Excluded Assets and Other Assets owned by Seller as of the date of the Agreement, and any securities purchased by Seller after the date of the Agreement which are included in one of the categories of securities listed on Schedule A.

“ Facility Amount ” means $3,500,000,000 (Three Billion Five Hundred Million Dollars) or such lesser Dollar amount to which the Facility Amount may be reduced from time to time in accordance with Paragraph 7 of this Annex.

“ Facility Termination Date ” means the earliest to occur of the following: (a) that date on which all of the FSA GIC Contracts are Paid in Full or terminated and there are no outstanding amounts owed by FSAM under the FSAM Insurance Agreement, the Master Repurchase Agreement or the Administrative Services Agreement that have not been Paid in Full, (b) the date which is (x) in the case of a Dexia Event of Default occurring at least 10 Business Days prior to the Liquidity and Collateral Trigger Expiration Date, the Liquidity and Collateral Expiration Date and (y) in the case of a Dexia Event of Default occurring on or after the tenth Business Day preceding the Liquidity and Collateral Trigger Expiration Date, 30 calendar days following such Dexia Event of Default (or if such day is not a Business Day, the next Business Day), and (c) the Business Day immediately following the settlement date of the set of Transactions initiated by a Default Repo Termination Request permitted upon a Dexia Event of Default as described in Paragraph 3(b)(vii) added by this Annex.

“ GAAP ” shall mean United States generally accepted accounting principles consistently applied.

“ IFRS ” shall mean International Financial Reporting Standards as promulgated by the International Standards Accounting Board as in effect from time to time consistently applied.

“ LIBOR ” shall mean the rate per annum calculated as set forth below:

(i) On each Reset Date, LIBOR for the next Pricing Rate Period will be reset as the rate for deposits in Dollars for the Specified LIBOR Period which appears on Reuters Screen LIBOR01 as of 11:00 A.M., London time, on such Reset Date; or

(ii) On any Reset Date on which no such rate appears on Reuters Screen LIBOR01 as described above, LIBOR for the next Pricing Rate Period will be determined on the basis of the arithmetic mean of the rates at which deposits in Dollars are offered by the Reference Banks at approximately 11:00 A.M., London time, on such Reset Date to prime banks in the London interbank market for the Specified LIBOR Period.

All percentages resulting from any calculations or determinations referred to in this definition will be rounded upwards, if necessary, to the nearest multiple of 1/100 th of 1% and all Dollar amounts used in or resulting from such calculations will be rounded to the nearest cent (with one-half cent or more being rounded upwards). In the event that the number of days in the first Pricing Rate Period or last Pricing Rate Period is different than the number of days corresponding to the Specified LIBOR Period, LIBOR for such Pricing Rate Period shall be based on an interpolated rate determined by the Buyer in a commercially reasonable manner.

“ Margin Notice Deadline ” means 11:00 A.M., New York time, on a Business Day .

“ Market Value ” means on any date and with respect to any Eligible Securities, the “Mark to Market Value” thereof as defined in the Pledge and Administration Agreement and as most recently determined on or prior to the date of determination.

“ Pledge and Administration Agreement ” means the Pledge and Administration Agreement, dated as of June 30, 2009, entered into among Dexia SA, Dexia Crédit Local S.A., Dexia Bank Belgium SA, Dexia FP Holdings Inc., Financial Security Assurance Inc. (“FSA”), FSA Asset Management LLC (“FSAM”), FSA Portfolio Asset Limited, FSA Capital Markets Services LLC, FSA Capital Markets Services (Caymans) Ltd., FSA Capital Management Services LLC and The Bank of New York Mellon Trust Company, National Association as Collateral Agent (the “Collateral Agent”), as amended, restated, supplemented or otherwise modified from time to time..

“ Pricing Rate ” shall mean, for any Purchased Securities and any Pricing Rate Period, an annual rate equal to LIBOR for such Pricing Rate Period plus the Applicable Spread. The Pricing Rate shall be computed on the basis of a 360-day year and the actual number of days elapsed.

“ Pricing Rate Determination Date ” shall mean with respect to any Pricing Rate Period, the second (2 nd ) Business Day preceding the first day of such Pricing Rate Period.

“ Pricing Rate Period End Date ” shall mean in relation to any Transaction each of (i) the Purchase Date (which shall be the first Pricing Rate Period End Date), and (ii) each date which is a

number of a calendar months equal to the Specified LIBOR Period after the immediately preceding Pricing Rate Period End Date; provided that the Repurchase Date shall be the last Pricing Rate Period End Date.

“ Pricing Rate Period ” shall mean each period commencing on and including one Pricing Rate Period End Date and ending on but excluding the next succeeding Pricing Rate Period End Date.

“ Purchase Date ” shall mean, with respect to any Purchased Security, the date on which such Purchased Security is transferred by Seller to Buyer.

“ Purchase Price ” shall mean, with respect to (i) any Purchased Security other than a Put Portfolio Asset, the price at which such Purchased Security is transferred by Seller to Buyer on the applicable Purchase Date, which shall be equal to the Market Value of such Purchased Security on the date the Confirmation for the relevant Transaction is received, and (ii) any Purchased Security that is a Put Portfolio Asset an amount equal to the “Put Settlement Amount” for such Purchased Security as defined in the Put Option Confirmation between Dexia SA, Dexia Credit Local S.A. and FSAM related to the Guaranteed Put Contract.

“ Reference Banks ” shall mean banks each of which shall (i) be a leading bank engaged in transactions in Eurodollar deposits in the international Eurocurrency market and (ii) have an established place of business in London. Initially, the sole Reference Bank shall be JPMorgan Chase Bank. If any Reference Bank should be unwilling or unable to act as such or if Buyer shall terminate the appointment of any Reference Bank or if any Reference Bank should be removed from the Reuters Monitor Money Rates Service or in any other way fail to meet the qualifications of a Reference Bank, Buyer in the exercise of its good faith business judgment may designate one or more alternative banks meeting the criteria specified in clauses (i) and (ii) above as Reference Banks for purposes of this Annex.

“ Repurchase Transaction Request ” has the meaning specified in Paragraph 3(b)(i).

“ Requirement of Law ” shall mean any law, treaty, rule, regulation, code, directive, policy, order or requirement or determination of an arbitrator or a court or other governmental authority whether now or hereafter enacted or in effect.

“ Reset Date ” shall mean, with respect to any Pricing Rate Period, the second Business Day preceding the first day of such Pricing Rate Period with respect to any Transaction.

“ Securities Priority List ” means a priority listing of the Best Available Eligible Securities for purposes of this Agreement maintained by Seller and a copy of which Seller has provided to Buyer, as most recently updated by Seller and notified to Buyer through the date of determination.

“ Seller’s Margin Percentage ” means 100%.

“ Specified LIBOR Period ” means, in relation to any Transaction, the period of one month, two months, three months or six months as specified by Seller in relation to such Transaction in its Repurchase Transaction Request.

“ Unutilized Commitment ” means on any date (x) the Facility Amount minus (y) the Purchase Price of all Purchased Securities that have not been repurchased by Seller hereunder (or with respect to which such repurchase has not been settled) on or prior to such date.

The definition of “Act of Insolvency” in the Base Agreement is deleted.

2. COMMITMENT; FACILITY AMOUNT; FEES

(a) From the Commitment Effective Date to the Facility Termination Date, Buyer agrees to enter into Transactions on the terms set forth below from time to time upon request by Seller, subject to and in accordance with the terms and conditions of this Annex and the Agreement. Notwithstanding anything to the contrary herein, Buyer shall have no obligation to enter into any proposed Transaction on any proposed Purchase Date that would have a Purchase Price that would, when combined with the Purchase Price of all Purchased Securities that have not been repurchased by Seller hereunder on or prior to such proposed Purchase Date exceed the Facility Amount.

(b) FSAM agrees to pay to DCL, subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, a commitment fee at the rate of 0.50% per annum on the Unutilized Commitment as determined by calculating the average Unutilized Commitment for each day of the fiscal quarter on the Weekly Assessment Point immediately following the end of each fiscal quarter. Such fee shall be payable three (3) Business Days following each Weekly Assessment Point, if such fee was considered in making the calculations on such day, in accordance with the preceding sentence, and on the date on which the Commitment terminates.

3. INITIATION; CONFIRMATION; TERMINATION

The provisions of Paragraph 3(a) and (b) of the Base Agreement are hereby deleted and replaced in their respective entireties by the following provisions:

“(a) By 2:00 P.M., New York time, on the Purchase Date for a Transaction, Buyer shall transfer the Purchase Price with respect to each Purchased Security specified in the relevant Confirmation to Seller by wire transfer of immediately available funds to either (i) the Authorized Account or (ii) the relevant account for any Senior Priority Payment identified by

FSAM under Section 11.2 of the Pledge and Administration Agreement in relation to which a Transaction is requested hereunder, and the related Purchased Security shall be concurrently transferred by Seller to an account specified by Buyer.

(b) (i) Seller (or the Collateral Agent or FSA as contemplated by (vi) below) may, from time to time, prior to the Facility Termination Date, request that Buyer enter into a Transaction with respect to one or more Eligible Securities. Seller (or the Collateral Agent or FSA as contemplated by (vi) below) shall initiate each request by submitting a written request, which shall set forth (A) information identifying, and specifying the principal amount of, each Eligible Security to be sold to Buyer as Purchased Securities, (B) the Purchase Price in relation to such Purchased Securities based on the calculation thereof by the Collateral Agent, (C) a date not earlier than one (1) Business Day following, and not later than three (3) Business Days following, the effective date of such request as the proposed Purchase Date, (D) the Specified LIBOR Period for the relevant Transaction, (E) such date, if any, as Seller (or the Collateral Agent or FSA as contemplated by (vi) below) may elect to specify as a fixed date of termination of such Transaction (a “Repurchase Transaction Request”). Each Repurchase Transaction Request shall be accompanied by the certificate described in clause (iii) below. Except as provided in clauses (ii) and (vii) below, any such Repurchase Transaction Request shall be effective (x) on the Business Day made, if delivered to Buyer at or before 4:30 P.M., Paris time, (the “Notice Deadline”) on such Business Day, or (y) otherwise, on the Business Day immediately following the date of its delivery to the Buyer. Each Repurchase Transaction Request shall be copied to the Collateral Agent at its address designated pursuant to Annex 2 to the Agreement. Any Repurchase Transaction Request will be made by email or facsimile, return receipt requested, in accordance with the address information set forth in Annex 2.

(ii) Notwithstanding the foregoing, an Accelerated Downgrade Liquidity Draw will be deemed to have been made on the day of the GIC Credit Event without regard to whether such GIC Credit Event occurred before or after close of business on that day. The Buyer will be required to advance funds with respect to such Transaction by the Accelerated Downgrade Liquidity Draw Deadline, notwithstanding any failure of the Seller to comply with Paragraphs 3(b)(i), 3(e) and 8(b) in connection with such deemed request. Without conditioning the obligations of the Buyer to provide funds under this paragraph, FSA shall provide notice of such GIC Credit Event on the date such event occurs.

(iii) At the time of any Repurchase Transaction Request, the Administrator (or if the Administrator has failed to make the relevant evaluation and comparisons, FSA) shall deliver a certificate to the Buyer, setting out the evaluation and comparison contemplated to be made by the Administrator under Sections 9.1 and 11.2(a) and (b) of the Pledge and Administration Agreement (and may also include any updates to such information) and stating that the proceeds of the relevant Transaction will be as contemplated by Paragraph 8(b) below. Notwithstanding the foregoing, if the proceeds of any Transaction give rise to a Dexia Reimbursement Payment, such portion of any Transaction shall be repaid promptly against delivery of the Purchased Securities related to such proceeds, together with any interest accrued thereon (but excluding any Additional Costs) and such repayment shall not be subject to the Subordinated Claims Payment Condition.

(iv) In making a Repurchase Transaction Request, Seller (or the Collateral Agent or FSA as contemplated by (vi) below) shall identify as Purchased Securities for the relevant Transaction securities that are not eligible to be posted as collateral under the FSA GIC Contracts (A) first, out of the Excluded Assets and Other Assets, the Best Available Eligible Securities based on the Securities Priority List as of the date of such Repurchase Transaction Request, with Seller (or the Collateral Agent or FSA as contemplated by (vi) below) identifying Eligible Securities lower on the Securities Priority List out of the Excluded Assets and Other Assets only as necessary to result in Seller’s obtaining the Purchase Price sought by Seller in requesting such Repurchase Transaction, and (B) second, out of the Put Portfolio Assets in the same manner as set forth in subclause (A). Seller agrees to use good faith, commercially reasonable efforts to ensure that the Securities Priority List is updated from time to time to reflect the Best Available Eligible Securities (and which shall specify whether the securities are Excluded Assets and Other Assets, Put Portfolio Assets or assets that are eligible to be posted as collateral under the FSA GIC Contracts), and Buyer shall have the right to consult with Seller from time to time, as to whether the Securities Priority List accurately reflects the Best Available Eligible Securities.

Notwithstanding the foregoing, on any date on which the Liquidity Facility has been fully drawn, a Repurchase Transaction Request may be made in relation to any Best Available Eligible Securities that would not be required to meet currently applicable collateral posting requirements in relation to FSA GIC Contracts (or would be required only to meet collateral posting requirements in relation to FSA GIC Contracts for which FSAM may elect not to post collateral in accordance with Section 11.2 of the Pledge and Administration Agreement).

(v) Each Repurchase Transaction Request shall constitute a “Confirmation” for purposes of the Base Agreement, which Confirmation, together with the Agreement, shall be conclusive evidence of the terms of the Transaction covered thereby unless objected to in writing by Buyer for manifest error no more than one (1) Business Day after the date such Confirmation is received by Buyer . Each Confirmation shall be deemed incorporated herein by reference with the same effect as if set forth herein at length. With respect to any Transaction, the Pricing Rate shall be determined initially as of the Pricing Rate Determination Date applicable to the first Pricing Rate Period for such Transaction, and shall be reset on each Reset Date for the next succeeding Pricing Rate Period for such Transaction. Buyer or its agent shall determine in accordance with the terms of this Annex the Pricing Rate on each Pricing Rate Determination Date for the related Pricing Rate Period and notify Seller of such rate for such period on the Reset Date or Pricing Rate Determination Date with respect to the first Transaction.

(vi) In the event that FSA has given written notice to the Seller with a copy to the Buyer that (i) the Seller has failed to comply with the Seller’s obligation to deliver a Repurchase Transaction Request under this Annex as set forth in Section 11.2(b) of the Pledge and Administration Agreement by 4:30 P.M., Paris time, on any Business Day or that (ii) Senior Priority Payments cannot be paid on any Business Day and the Seller has not delivered a Repurchase Transaction Request as set forth in Section 11.2 of the Pledge and Administration Agreement in an amount equal to such unpaid Senior Priority Payments or the remaining amount available under the Facility Amount (if less) by 4:30 P.M., Paris time, then the Collateral Agent or FSA shall be authorized to deliver a Repurchase Transaction Request on behalf of the Seller, and

such Repurchase Transaction Request, if delivered no later than 4:30 P.M., Paris time, on the Business Day immediately following the Business Day on which the Seller fails to deliver a Repurchase Transaction Request, will be deemed to have been delivered by 4:30 P.M., Paris time, on the preceding Business Day and the Buyer shall advance funds with respect to such Transaction by 2:00 P.M., New York City time, on the Business Day following the failure by the Seller to make the request notwithstanding any failure of the Seller to comply with Paragraphs 3(b)(i) (with respect to the Notice Deadline), 3(e) and 8(b). Any such request by the Collateral Agent or FSA must be accompanied by the certificate described in Paragraph 3(b)(iii). In the event that a Dexia Event of Default has occurred and FSA has elected to become Secured Party Representative, the Collateral Agent or FSA shall be authorized to deliver a Repurchase Transaction Request on behalf of the Seller, and such request shall be effective hereunder as if made by the Seller.

(vii) If a Dexia Event of Default has occurred, the Seller (or the Collateral Agent or FSA as described in Paragraph 3(b)(vi)) is permitted to deliver a Repurchase Transaction Request, on or before the Termination Date, for a set of Transactions (a “Default Repo Termination Request”) with a Purchase Price in an aggregate amount that, together with any Default Termination Loan (as defined in the Liquidity Facility), does not exceed (A) the Exposure as calculated under the Credit Support Annex to the Dexia Guaranteed Put Contract (as most recently determined on or prior to the date of such Repurchase Transaction Request), provided that for such purpose the “GIC Business Costs Amount” shall be deemed increased by 25% minus (B) (x) the “Value” of all “Posted Collateral” held by the Collateral Agent under the Dexia CSAs (as such terms are defined in the relevant Dexia CSA and as most recently determined on or prior to the date of such Repurchase Transaction Request) plus (y) the cash proceeds of the liquidation of any FSAM Collateral which has been sold or liquidated in accordance with an exercise of creditor’s remedies by the Collateral Agent upon such Dexia Event of Default. For the avoidance of doubt, the amount of any Default Repo Termination Request delivered by the Seller (or the Collateral Agent or FSA as described in (vi) above) shall not exceed the Unutilized Commitment at the time of the request.

(viii) If Seller, the Collateral Agent or FSA has effected a Liquidity Draw Offset (as defined in the Credit Support Annex to the Dexia Guaranteed Put Contract) in relation to any Purchase Price not yet paid by Buyer in relation to any Repurchase Transaction Request hereunder, the amount payable as Purchase Price to Seller in relation to such Transaction shall be reduced by the relevant Liquidity Draw Offset.”

Paragraph 3(c) of the Base Agreement is restated to read as follows:

“(c) On the earliest of (i) the date (if any) fixed for termination of a Transaction in the case of Transactions having a fixed term, (ii) any date which is the last day of a Pricing Rate Period in relation to the relevant Transaction and is elected by Seller upon not less than two (2) Business Days’ irrevocable prior written notice to Buyer to be the Repurchase Date for such Transaction, (iii) any date following a Dexia Event of Default on which funds are available for payments to Buyer subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein, and (iv) the date on which all of the FSA GIC Contracts are Paid in Full or terminated and there are no outstanding amounts owed by the Seller under the

FSAM Insurance Agreement, the Master Repurchase Agreement, or the Administrative Services Agreement , termination of the applicable Transaction will be effected by transfer to Seller or its agent of the Purchased Securities and any Income in respect thereof received by Buyer (and not previously credited or transferred to, or applied to the obligations of Seller pursuant to Paragraph 5 hereof) against the transfer of the Repurchase Price to an account of Buyer. Where clause (iii) of the foregoing sentence applies, Transactions shall be terminated in the reverse order of which they were initiated (on a “last in, first out” basis), and shall be terminated in part (with Buyer’s delivery of Purchased Securities and Income to be proportionally adjusted) to the extent that only a portion of the Repurchase Price would be available under the Priority of Payments and subject to the satisfaction of the Subordinated Claims Payment Condition specified therein . Amounts received on a termination of a Transaction shall be applied in the order of priority set forth in Section 11.1(b)(viii) of the Pledge and Administration Agreement.

The following is deemed added to the Base Agreement as Paragraphs 3(d), (e), (f) and (g):

“(d) Either Buyer or Seller may also request a “delivery versus payment” settlement of amounts to be paid or delivered in relation to any Transaction on a Purchase Date or Repurchase Date.

(e) The obligations of the Buyer to enter into and make settlement of a Transaction hereunder will be unconditional and subject only (except as provided in Paragraph 3(b)(ii)) to receipt of the Repurchase Transaction Request and the certificate described in Paragraph 3(b)(iii) within the time period contemplated thereby.

(f) Without limitation of Paragraph 12(b) below, no breach by the Seller (or by the Collateral Agent, FSA any other party to the Pledge and Administration Agreement or any other person) of any representation, warranty, covenant or other term or condition of this Agreement, the Pledge and Administration Agreement, any other Transaction Document, or any other agreement described in or contemplated in the Purchase Agreement shall constitute a defense to or otherwise impair the obligation of the Buyer to enter into and make settlement of a Transaction hereunder in accordance with the terms and conditions described in Paragraph 3(e) above.

(g) Notwithstanding Paragraph 3(f) above, the Buyer will be indemnified by the Seller for any losses incurred by it in connection with entering into or making settlement of any Transaction if the representations and warranties of the Seller are inaccurate or the Seller has breached its obligations under this Agreement to the Buyer, provided that any such indemnification or any other claim or recourse of the Buyer for a breach by the Seller of any representation, warranty, covenant or other term or condition of this agreement (other than as set forth in Paragraph 3(e) above) will be payable only subject to the Priority of Payments and (without prejudice to any claims for Dexia Reimbursement Payments in accordance with the terms of the Pledge and Administration Agreement) satisfaction of the Subordinated Claims Payment Condition specified therein.”

4. PERIODIC PRICE DIFFERENTIAL PAYMENTS; MARGIN PAYMENTS

(a) On the last day of each Pricing Rate Period (or if such day is not a Business Day, the next following Business Day), Seller shall pay to Buyer, subject to the Priority of Payments and the satisfaction of the Subordinated Claims Payments Condition specified therein (other than with respect to Dexia Reimbursement Payments) , in accordance with the account details specified in such Confirmation or such standing account details as may be agreed between Buyer and Seller from time to time, the accrued and unpaid Price Differential in relation to each Transaction and such Pricing Rate Period. For purposes of calculating the accrued Price Differential relation to any Pricing Rate Period other than the initial Pricing Rate Period, the reference to “Purchase Date” in the definition of “Price Differential” shall be deemed to refer to the first day of such Pricing Rate Period.

(b) For purposes of Paragraph 4(c) of the Base Agreement the words “such day” shall be replaced by “the next Business Day” and the words “the next business day following” shall be replaced by “the second Business Day following”.

(c) For purposes of Paragraph 4(e), the minimum dollar amount of Margin Deficit which will give rise to obligations under Paragraph 4(a) and 4(b) is $5,000,000 in relation to all Transactions in the aggregate. Paragraph 4(f) will not apply.

(d) For the avoidance of doubt, payments of Margin Deficit by Seller under Paragraph 4(a) shall be subject to funds being available therefor under the Priority of Payments and subject to the satisfaction of the Subordinated Claims Payment Condition specified therein , provided, however, that such restriction shall not restrict Buyer’s rights under Paragraph 5 in relation to Income received on Purchased Securities.

(e) For purposes of Paragraph 5, Income shall be credited by Buyer to the FSAM Cash Account not later than three Business Days following receipt of such Income by Buyer.

5. REPRESENTATIONS

Paragraph 10 of the Base Agreement (“Representations”) is hereby supplemented by the following:

“Seller represents and warrants to Buyer that as of the Purchase Date for the purchase of any Purchased Security by Buyer from Seller and any Transaction hereunder and as of the date of this Annex and at all times while this Annex and any Transaction hereunder is in full force and effect:

(a) Seller is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware, and has all requisite power and authority, corporate and otherwise, to conduct its business as now conducted and to own its properties. Seller has full power and authority to enter into this Agreement and to incur its obligations provided for herein and therein, all of which have been duly authorized by all proper and necessary corporate action on the part of the Seller. This Agreement has been duly executed and

delivered by the Seller and constitutes the valid and legally binding agreement of the Seller, enforceable against the Seller in accordance with its terms, except as enforceability may be affected by bankruptcy, insolvency and other laws relating to or affecting creditors’ rights generally and by general principles of equity.

(b) All consents and approvals of, and all notices to and filings with, any governmental entities or regulatory bodies required as a condition to the valid execution, delivery or performance by the Seller of this Agreement have been obtained or made. Neither the execution and delivery of this Agreement nor compliance with the terms and provisions hereof and thereof will conflict with, result in a breach of or constitute a default under (i) any of the terms, conditions or provisions of the limited liability company agreement of the Seller, (ii) any law, regulation or order, writ, judgment, injunction, decree, determination or award of any court or governmental instrumentality or (iii) any agreement or instrument to which the Seller is a party or by which it is bound.

(c) The consolidated financial statements of the Seller and its consolidated subsidiaries (if any) furnished or made available to the Buyer on or prior to the date on which this representation is made or deemed repeated are complete and correct and fairly present the consolidated financial condition of the Seller and its consolidated subsidiaries as at the dates thereof and the results of operations for the periods covered thereby (subject, in the case of quarterly statements, to normal, year-end audit adjustments). Such financial statements were prepared in accordance with GAAP or IFRS consistently applied.

(d) The Seller is not (i) a “holding company,” or a “subsidiary company” of a “holding company,” or of a “subsidiary company” of a “holding company,” within the meaning of the Public Utility Holding Company Act of 1935, or (ii) required to be registered as an “investment company” as defined in (or subject to regulation under) the Investment Company Act of 1940. Neither the Seller’s entering into any Transaction, or the application of the proceeds or repayment thereof by the Seller, nor the consummation of other transactions contemplated hereunder, will violate any provision of the Public Utility Holding Company Act of 1935, the Investment Company Act of 1940 or any rule, regulation or order of the SEC.

(e) All financial data or information concerning the Purchased Securities that has been delivered by or on behalf of Seller to Buyer is, to the best knowledge of Seller, true, complete and correct in all material respects.

(f) Except as disclosed in the manner described in Section 3.1(a)(v) of the Pledge and Administration Agreement, there is no action, suit or proceeding pending against, or to the Seller’s knowledge threatened against or affecting, the Seller before any court or arbitrator or any governmental body, agency or official which, if adversely determined, would have a material adverse effect (actual or prospective) on the Seller’s business, properties or financial position or which seeks to terminate or calls into question the validity or enforceability of this Agreement.

(g) Immediately prior to the purchase of any Purchased Securities by Buyer from Seller, such Purchased Securities are free and clear of any lien, security interest, claim, option, charge, encumbrance or impediment to transfer (including any “adverse claim” as defined in

Section 8-102(a)(1) of the UCC but excluding any liens or encumbrances to be released simultaneously with the sale to Buyer hereunder), and are not subject to any rights of setoff, any prior sale, transfer, assignment, or participation by Seller or any agreement by Seller to assign, convey, transfer or participate, in whole or in part, and Seller is the sole legal record and beneficial owner of and owns and has the right to sell and transfer such Purchased Securities to Buyer and, upon transfer of such Purchased Securities to Buyer, Buyer shall be the owner of such Purchased Securities (other than for U.S. Federal, state and local income and franchise tax purposes) free of any adverse claim, subject to Seller’s rights pursuant to the Agreement. In the event the related Transaction is recharacterized as a secured financing of the Purchased Securities, the provisions of the Agreement are effective to create in favor of Buyer a valid security interest in all rights, title and interest of Seller in, to and under the Purchased Securities, Buyer shall have a valid, perfected and enforceable first priority security interest in the Purchased Securities and such other collateral, subject to no lien or rights of others other than as granted herein.

(h) Neither the entering into nor consummation of any Transaction hereunder, nor the use of the proceeds thereof, will violate any provisions of Regulation T, U or X. If requested by Buyer, Seller, any applicable Affiliate of Seller and the recipient of any portion of the proceeds of, or any portion of, any Transaction shall furnish to Buyer a statement on Federal Reserve Form G-3 referred to in Regulation U.”

6. EVENTS OF DEFAULT

The first sentence (ending at the colon before subparagraph (a)) of Paragraph 11 of the Base Agreement (“Events of Default”) is hereby amended to read as follows:

“In the event that a Dexia Event of Default as defined in the Pledge and Administration Agreement occurs (with respect to Buyer an “Event of Default”):”

For the avoidance of doubt, no Events of Default shall apply to Seller and the provisions of Paragraph 11 referring to circumstances where the Seller is the defaulting party shall be disregarded.

7. OPTIONAL REDUCTION OF FACILITY BY SELLER

With the prior written consent of FSA, Seller may reduce the Unutilized Commitment portion of the Facility Amount at any time in whole, or from time to time in part by an amount equal to $5,000,000 or any larger amount in increments of $1,000,000, (or such reduction as reduces the Facility Amount to the amount outstanding), by delivering to Buyer written notice specifying the amount of such reduction and the date on which such reduction is to become effective (which date may not be earlier than the date of delivery of such notice). Any such reduction shall be irrevocable. Any such reduction without the prior written consent of FSA shall be void ab initio .

8. COVENANTS

The Seller covenants and agrees that until after the Facility Termination Date and the later to occur of (i) the last Repurchase Date and (ii) the performance of all obligations of the Seller hereunder:

(a) General Affirmative Covenants. The Seller will maintain its existence as a limited liability company in good standing, will comply in all material respects with all applicable laws, rules, regulations and orders of any governmental authority noncompliance with which would have a material adverse effect on its financial condition or operations or on its ability to meet its obligations hereunder, and will continue to engage in business of the same general type as that engaged in by the Seller on the date hereof. The Seller will pay and discharge, at or before maturity, all its obligations and liabilities, including, without limitation, tax liabilities, where failure to satisfy such obligations or liabilities in the aggregate would have a material adverse effect on its financial condition, operations or ability to meet its obligations hereunder.

(b) Use of Proceeds. The proceeds of any Transaction may be used only (x) in the case of any Transaction other than a Transaction requested pursuant to a Default Repo Termination Request, to satisfy a scheduled or expected Senior Priority Payment identified by FSAM or FSA in accordance with the provisions Section 11.2(a) or (b) of the Pledge and Administration Agreement at or prior to the relevant Repurchase Transaction Request or (y) in the case of a Transaction requested pursuant to a Default Repo Termination Request, to be applied to Senior Priority Payments or to purchase Permitted Investments to be held by the Collateral Agent under the Pledge and Administration Agreement and subsequently applied to Senior Priority Payments.

(c) Maintenance of Properties. The Seller shall (a) maintain, preserve and protect all of its material properties and equipment necessary in the operation of its business in good working order and condition, ordinary wear and tear excepted; and (b) use the standard of care typical in the industry in the operation and maintenance of its facilities, except where the failure to do so could not reasonably be expected to have a material adverse effect on the Seller.

(d) Maintenance of Insurance. The Seller shall maintain with financially sound and reputable insurance companies or with a captive insurance company that is an affiliate of the Seller as to which the Buyer may request reasonable evidence of financial responsibility, insurance with respect to its properties in such amounts with such deductibles and covering such risks as are customarily carried by companies engaged in similar businesses and owning similar properties in localities where the Seller or any of its subsidiaries operates.

9. RETRANSFER TERMS

It is Seller’s intent to account for each Transaction hereunder as a secured financing under GAAP and/or IFRS. Notwithstanding Paragraph 8 of the Base Agreement, Buyer agrees to use its good faith, commercially reasonable efforts to enter into any restriction on Buyer’s rights

under Paragraph 8 of the Base Agreement which Seller shall demonstrate, to be required in order for Seller to properly account for any Transaction as a secured borrowing.

10. TAXES, INCREASED COSTS

(a) If, after the date of this Annex, the adoption of or any change in any Requirement of Law or in the interpretation or application thereof by any Governmental Authority or compliance by Buyer with any request or directive (whether or not having the force of law) from any central bank or other Governmental Authority having jurisdiction over Buyer made subsequent to the date hereof:

(i) shall subject Buyer to any tax of any kind whatsoever with respect to the Agreement, any Purchased Security or any Transaction, or change the basis of taxation of payments to Buyer in respect thereof (except for changes in the rate of tax on Buyer’s overall net income);

(ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of Buyer; or

(iii) shall impose on Buyer any other condition due to the Agreement or the Transactions;

and the result of any of the foregoing is to increase the cost to Buyer of entering into, continuing or maintaining Transactions or to reduce any amount receivable under the Agreement in respect thereof; then, in any such case, Seller shall pay Buyer, within 30 days after written demand therefor is received by Seller, any additional amounts necessary to compensate Buyer for such increased cost payable or reduced amount receivable. If Buyer becomes aware that it is entitled to claim any additional amounts pursuant to this Paragraph 10(a), it shall notify Seller in writing of the event by reason of which it has become so entitled within a reasonable period after Buyer becomes aware thereof. A certificate as to the calculation of any additional amounts payable pursuant to this subsection shall be submitted by Buyer to Seller and shall be conclusive and binding upon Seller in the absence of manifest error. In determining such additional amounts, Buyer will act reasonably and in good faith.

This covenant shall survive the last Repurchase Date, and the repurchase by Seller of any or all of the Purchased Securities.

(b) If Buyer shall have reasonably determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by Buyer or any corporation controlling Buyer with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof does have the effect of reducing the rate of return on Buyer’s or such corporation’s capital as a consequence of its obligations

hereunder to a level below that which Buyer or such corporation could have achieved but for such adoption, change or compliance (taking into consideration Buyer’s or such corporation’s policies with respect to capital adequacy) by an amount deemed by Buyer to be material, then, from time to time, within 30 days after submission by Buyer to Seller of a written request therefor, Seller shall pay to Buyer such additional amount or amounts as will compensate Buyer for such reduction. A certificate as to the calculation of any additional amounts payable pursuant to this subsection shall be submitted by Buyer to Seller and shall be conclusive and binding upon Seller in the absence of manifest error. In determining such additional amounts, Buyer will act reasonably and in good faith. This covenant shall survive the Facility Termination Date, and the repurchase by Seller of any or all of the Purchased Securities.

11. FURTHER ADJUSTMENTS TO BASE AGREEMENT

The following additional provisions of the Base Agreement are deemed deleted and/or superseded by this Annex: Subclause (B) of the last sentence of Paragraph 5 (with the designation “(A)” to be removed from such sentence), Paragraph 9, subclause (ii) of Paragraph 12 (with subclause (iii) being redesignated as subclause (ii)), Paragraph 15, Paragraph 16, Paragraph 17 and Paragraph 18.

12. MISCELLANEOUS

(a) Setoff . Without prejudice to the Liquidity Draw Offset provision set forth in Paragraph 3(b)(viii), the rights and obligations of the parties hereunder shall not be subject to, and shall not form the basis for, any rights of setoff arising from a transaction not subject to this Agreement; provided , that if on any day there are amounts in the same currency payable both by the Buyer to the Seller and by the Seller to the Buyer, in accordance with the Priority of Payments, such amounts may be set off against one another and only a single net amount transferred by the Buyer to the Seller, or by the Seller to the Buyer, as the case may be.

(b) Subordination. The Buyer agrees any and all amounts payable to it by the Seller under this Agreement and any Transaction Documents shall be paid to the Buyer only in accordance with the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) satisfaction of the Subordinated Claims Payment Condition specified therein.

(c) Amendments and Waivers . No failure or delay on the part of the Buyer in exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power preclude any other or further exercise thereof or the exercise of any other right or power hereunder. No amendment, modification, supplement, termination or waiver of any provision of this Agreement nor consent to any departure by the Seller herefrom or therefrom shall in any event be effective unless the same shall be in writing and signed by the Buyer, the Seller and FSA. Any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. No notice to or demand on the Seller in any case shall, of itself, entitle the Seller to any other or further notice or demand in similar or other circumstances. Notwithstanding the foregoing, any amendment, modification, supplement, termination or waiver of any provision of this Agreement entered into by the Buyer and the Seller without the prior written consent of FSA shall be void ab initio .

(d) Third Party Beneficiary . Each of FSA and the Collateral Agent shall be a third party beneficiary of the provisions of this Agreement setting forth rights of FSA or the Collateral Agent, respectively.

(e) Successors and Assigns. This Agreement shall inure to the benefit of, and shall be enforceable by, the parties hereto and their respective successors and permitted assigns. Neither this Agreement nor any interest or obligation in or under this Agreement may be assigned or transferred (whether by way of security or otherwise) by the Buyer without the consent of the Seller and FSA (other than for DCL to make an assignment or transfer to DBB or DBB to make an assignment or transfer to DCL), other than

(I) pursuant to a consolidation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (a “Corporate Reorganization”), provided that the Remedies Nonimpairment Condition (as defined in the Pledge and Administration Agreement) is satisfied in relation to such Corporate Reorganization; or

(II) pursuant to an assignment of its rights and obligations hereunder in whole or in part by the Buyer (the “Assigning Buyer”) to an Affiliate of such Buyer (a “Transferee Buyer”) where (i)(a) such Transferee Buyer has a rating assigned by Moody’s to its long-term indebtedness and its short-term indebtedness at least as high as the rating assigned by Moody’s to the long-term indebtedness and short-term indebtedness of the Assigning Buyer, and (b) such Transferee Buyer has a rating assigned by S&P to its long-term indebtedness and its short-term indebtedness at least as high as the rating assigned by S&P to the long-term indebtedness and short-term indebtedness of the Assigning Buyer, in each case on the date of the proposed assignment, (ii) the Assigning Buyer receives confirmation from Moody’s and S&P that none of the ratings of the Transferee Buyer referred to in clause (i) above will be reduced or withdrawn after giving effect to the proposed assignment (or if reduced, will be reduced to a rating subcategory not lower than the corresponding rating subcategory of the Assigning Buyer (and for this purpose a rating of the same subcategory which is on negative watch or watch for downgrade shall be considered lower than a rating of the same subcategory that is not on negative watch or watch for downgrade)), (iii) if the Transferee Buyer would be located in a different jurisdiction than the Assigning Buyer (and is not located in Belgium or France), the Remedies Nonimpairment Condition is satisfied in relation to such assignment, (iv) the relevant Unutilized Commitment of the Assigning Buyer is $1.5 billion or less at the time of such assignment and (v) after giving effect to such assignment there would be no more than three different Buyers having a separate Unutilized Commitment hereunder.

The Seller may not assign or otherwise transfer any of its rights or obligations under this Agreement without the prior written consent of the Buyer, and any purported assignment without such consent shall be void.

(f) Costs, Expenses and Taxes. The Seller agrees to pay on demand all costs and expenses of the Buyer, including reasonable fees and expenses of counsel, in connection with the enforcement against it of this Agreement and the protection of the Buyers’ rights hereunder and

thereunder, including any bankruptcy, insolvency, enforcement proceedings or restructuring with respect to the Seller, in each case subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein. In addition, the Seller shall pay any and all stamp and other taxes and fees payable or determined to be payable in connection with the execution, delivery, filing and recording of this Agreement, and agrees to save the Buyer harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees, in each case subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition specified therein .

(g) Acknowledgement of Security Interests . The Buyer hereby acknowledges that the Seller is granting a security interest in its rights under this Agreement to the Collateral Agent on behalf of the Secured Parties (including FSA) to secure its obligations under the Pledge and Administration Agreement and the Transactions Documents, and the Buyer hereby consents to any transfer of any or all of such rights in connection with the enforcement of such security interests.

(h) Governing Law . Governing Law . THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK AND THE MANDATORY CHOICE OF LAW RULES CONTAINED IN THE UCC. Each of the parties hereto hereby irrevocably submits to the exclusive jurisdiction of any U.S. federal or state court in The City of New York for the purpose of any suit, action, proceeding or judgment arising out of or relating to this Agreement. Each of the parties hereto hereby consents to the laying of venue in any such suit, action or proceeding in New York County, New York, and hereby irrevocably waives any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum and agrees not to plead or claim the same. Notwithstanding the foregoing, nothing contained in this Agreement shall limit or affect the rights of any party hereto to exercise remedies under this Agreement or any of the other Transaction Documents, or to enforce any judgment with respect thereto, in any jurisdiction or venue. Any process in any such action shall be duly served if mailed by registered mail, postage prepaid, with respect to (i) the Seller, at its address designated pursuant to Annex 2 to the Agreement and (ii) with respect to the Buyer, the Buyer hereby irrevocably appoints Dexia Crédit Local New York Branch (the “Process Agent”), at 445 Park Avenue, 7 th Floor, New York, NY 10022, as its agent to receive, on behalf of the Buyer and its property, service of copies of the summons and complaint and any other process which may be served in any such action or proceeding. Such service may be made by mailing or delivering a copy of such process to the Buyer in care of the Process Agent at the Process Agent’s above address, and the Buyer hereby irrevocably authorizes and directs the Process Agent to accept such service on its behalf. The Buyer may appoint a replacement Process Agent with an office in the State of New York by notice to FSA.

(i) WAIVER OF JURY TRIAL . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS AGREEMENT OR THE TRANSACTIONS

CONTEMPLATED HEREBY. EACH PARTY ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION.

(j) Sovereign Immunity . To the extent that the parties hereto, or any of their respective properties, assets or revenues may have or may hereafter become entitled to, or have attributed to them, any right of immunity, on the grounds of sovereignty or otherwise, from any legal action, suit or proceeding, from the giving of any relief in any respect thereof, from setoff or counterclaim, from the jurisdiction of any court, from service of process, from attachment upon or prior to judgment, from attachment in aid of execution of judgment, or from execution of judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which proceedings may at any time be commenced, with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Agreement, the parties hereto hereby irrevocably and unconditionally waive, and agree not to plead or claim, to the fullest extent permitted by applicable law, any such immunity and consent to such relief and enforcement.

(k) Non-Petition . The Buyer agrees that it will not, prior to the Senior Release Date, acquiesce, petition or otherwise institute against, or join any other person in instituting against, the Seller, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy, or similar law, including without limitations proceedings seeking to appoint a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Seller or any substantial part of its property; provided , that this provision shall not restrict or prohibit the Buyer from joining any such proceedings which shall have already commenced under applicable laws and not in violation of this provision. This provision shall survive the termination of this Agreement for any reason.

(l) Limited Recourse . The obligations of the Seller in relation to this Agreement and any Transaction hereunder are limited recourse obligations, payable solely from the proceeds of the FSAM Collateral available under and applied in accordance with the Priority of Payments and (other than with respect to Dexia Reimbursement Payments) subject to the satisfaction of the Subordinated Claims Payment Condition specified therein. Upon application of the FSAM Collateral and proceeds thereof available to satisfy the obligations of the Seller hereunder in accordance with the Pledge and Administration Agreement, the Buyer shall not be entitled to take any further steps against the Seller to recover any sums due and shall not constitute a claim against the Seller to the extent of any insufficiency. No recourse shall be had for the payment of any amounts owing in respect of this Agreement against any officer, director, employee, stockholder, member or incorporator of the Seller. This provision shall survive the termination of this Agreement for any reason. The Buyer shall have no right to commence or maintain any action, suit or proceeding against Seller arising out of any breach of this Agreement by Seller for any reason, but such provision shall be without prejudice to the rights of the Buyer to indemnification in accordance with Paragraph 3(g).

(m) Counterparts . This Agreement may be signed in any number of counterparts, each of which shall be an original, with the same effect as if all signatures thereon were upon the same instrument. This Agreement constitutes the entire agreement and understanding between the Seller

and the Buyer with respect to the subject matter hereof, and supersedes any prior agreements and understandings with respect thereto.

(n) Notices . The words “mail, electronic mail, fascsimile” are deemed to replace the words “mail, facsimile” in Paragraph 13. The last sentence of Paragraph 13 is deemed deleted.

IN WITNESS WHEREOF, the parties hereto have caused this Committed Term Repurchase Agreement Annex to be executed by their respective corporate officers, thereunto duly authorized, as of June 30, 2009.

DEXIA CRÉDIT LOCAL S.A.			FSA ASSET MANAGEMENT LLC


By:			By:
Title:			Title:

SCHEDULE A TO ANNEX 1 — ELIGIBLE SECURITIES

Security Type:		Priority Category:
U.S. Treasury Bonds, Bills and Notes, or other direct obligations of, or obligations guaranteed by, the U.S. Government		2
Fannie Mae, FHLMC and GNMA debt or agency RMBS or CMBS securities		2
Other RMBS or CMBS		4
Credit Card ABS		4
Auto Loan ABS		4
Student Loan ABS		4
Municipal Bonds		1
CLO/CDO Securities		4
Corporate Bonds		3
Military Housing Bonds		5
Domestic and International Project Finance Bonds		5
Domestic Utility Bonds		5
NIMs		5
“Triple-X” Bonds		5
“Refi” Bonds		5
Westlake Facility		5
Other Securities owned by Borrower		Deemed to have lowest Priority Category.

Exhibit 10.3.1

(Multicurrency—Cross Border)

ISDA Ò

International Swap Dealers Association, Inc.

MASTER AGREEMENT

dated as of June 30, 2009

DEXIA SA and DEXIA CRÉDIT LOCAL
S.A. , jointly and severally;

and

FSA ASSET MANAGEMENT LLC

have entered and/or anticipate entering into one or more transactions (each a “Transaction”) that are or will be governed by this Master Agreement, which includes the schedule (the “Schedule”), and the documents and other confirming evidence (each a “Confirmation”) exchanged between the parties confirming those Transactions.

Accordingly, the parties agree as follows:—

1. Interpretation

(a) Definitions . The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement.

(b) Inconsistency . In the event of any inconsistency between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will prevail for the purpose of the relevant Transaction.

(c) Single Agreement . All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this “Agreement”), and the parties would not otherwise enter into any Transactions.

2. Obligations

(a) General Conditions .

(i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement.

(ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement.

(iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default or Potential Event of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each other applicable condition precedent specified in this Agreement.

(b) Change of Account . Either party may change its account for receiving a payment or delivery by giving notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change.

(i) in the same currency; and

(ii) in respect of the same Transaction,

by each party to the other, then, on such date, each party’s obligation to make payment of any such amount will be automatically satisfied and discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount.

The parties may elect in respect of two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction. The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such Transactions from such date). This election may be made separately for different groups of Transactions and will apply separately to each pairing of Offices through which the parties make and receive payments or deliveries.

(d) Deduction or Withholding for Tax .

(i) Gross-Up . All payments under this Agreement will be made without any deduction or withholding for or on account of any Tax unless such deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect. If a party is so required to deduct or withhold, then that party (“X”) will:—

(1) promptly notify the other party (“Y”) of such requirement;

(2) pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld from any additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Y;

(3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such authorities; and

(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise entitled under this Agreement, such additional amount as is necessary to ensure that the net amount actually received by Y (free and clear of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount Y would have received had no such deduction or withholding been required. However, X will not be required to pay any additional amount to Y to the extent that it would not be required to be paid but for:—

(A) the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or

(B) the failure of a representation made by Y pursuant to Section 3(f) to be accurate and true unless such failure would not have occurred but for (I) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (II) a Change in Tax Law.

(ii) Liability . If:—

(1) X is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding in respect of which X would not be required to pay an additional amount to Y under Section 2(d)(i)(4);

(2) X does not so deduct or withhold; and

(3) a liability resulting from such Tax is assessed directly against X,

then, except to the extent Y has satisfied or then satisfies the liability resulting from such Tax, Y will promptly pay to X the amount of such liability (including any related liability for interest, but including any related liability for penalties only if Y has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).

(e) Default Interest; Other Amounts . Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement.

3. Representations

Each party represents to the other party (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement) that:—

(a) Basic Representations.

(i) Status . It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing;

(ii) Powers . It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance;

(iii) No Violation or Conflict . Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets;

(iv) Consents . All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and

(v) Obligations Binding . Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).

(b) Absence of Certain Events . No Event of Default or Potential Event of Default or, to its knowledge, Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a party.

(c) Absence of Litigation . There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document.

(d) Accuracy of Specified Information . All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate and complete in every material respect.

(e) Payer Tax Representation . Each representation specified in the Schedule as being made by it for the purpose of this Section 3(e) is accurate and true.

(f) Payee Tax Representations . Each representation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true.

4. Agreements

Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:—

(a) Furnish Specified Information . It will deliver to the other party or, in certain cases under subparagraph (iii) below, to such government or taxing authority as the other party reasonably directs:—

(i) any forms, documents or certificates relating to taxation specified in the Schedule or any Confirmation;

(ii) any other documents specified in the Schedule or any Confirmation; and

(iii) upon reasonable demand by such other party, any form or document that may be required or reasonably requested in writing in order to allow such other party or its Credit Support Provider to make a payment under this Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax or with such deduction or withholding at a reduced rate (so long as the completion, execution or submission of such form or document would not materially prejudice the legal or commercial position of the party in receipt of such demand), with any such form or document to be accurate and completed in a manner reasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification,

in each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable.

(b) Maintain Authorisations . It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future.

(c) Comply with Laws . It will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which it is a party.

(d) Tax Agreement . It will give notice of any failure of a representation made by it under Section 3(f) to be accurate and true promptly upon learning of such failure.

(e) Payment of Stamp Tax . Subject to Section 11, it will pay any Stamp Tax levied or imposed upon it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is incorporated, organised, managed and controlled, or considered to have its seat, or in which a branch or office through

which it is acting for the purpose of this Agreement is located (“Stamp Tax Jurisdiction”) and will indemnify the other party against any Stamp Tax levied or imposed upon the other party or in respect of the other party’s execution or performance of this Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the other party.

5. Events of Default and Termination Events

(a) Events of Default . The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any of the following events constitutes an event of default (an “Event of Default”) with respect to such party:—

(i) Failure to Pay or Deliver . Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party;

(ii) Breach of Agreement . Failure by the party to comply with or perform any agreement or obligation (other than an obligation to make any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination Event or any agreement or obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party in accordance with this Agreement if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the party;

(iii) Credit Support Default .

(1) Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing after any applicable grace period has elapsed;

(2) the expiration or termination of such Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or

(3) the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document;

(iv) Misrepresentation . A representation (other than a representation under Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated;

(v) Default under Specified Transaction . The party, any Credit Support Provider of such party or any applicable Specified Entity of such party (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of, that Specified Transaction, (2) defaults, after giving effect to any applicable notice requirement or grace period, in making any payment or delivery due on the last payment, delivery or exchange date of, or any payment on early termination of, a Specified Transaction (or such default continues for at least three Local Business Days if there is no applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf);

(vi) Cross Default . If “Cross Default” is specified in the Schedule as applying to the party, the occurrence or existence of (1) a default, event of default or other similar condition or event (however

described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any applicable notice requirement or grace period);

(vii) Bankruptcy . The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:—

(1) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (5) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) inclusive); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or

(viii) Merger Without Assumption . The party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer:—

(1) the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or

(2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement.

(b) Termination Events . The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in (ii) below or a Tax Event Upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event

Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is specified pursuant to (v) below:—

(i) Illegality . Due to the adoption of, or any change in, any applicable law after the date on which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (other than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):—

(1) to perform any absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or

(2) to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support Provider) has under any Credit Support Document relating to such Transaction;

(ii) Tax Event . Due to (x) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (y) a Change in Tax Law, the party (which will be the Affected Party) will, or there is a substantial likelihood that it will, on the next succeeding Scheduled Payment Date (1) be required to pay to the other party an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is required to be deducted or withheld for or on account of a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is required to be paid in respect of such Tax under Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or (B));

(iii) Tax Event Upon Merger . The party (the “Burdened Party”) on the next succeeding Scheduled Payment Date will either (1) be required to pay an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been deducted or withheld for or on account of any Indemnifiable Tax in respect of which the other party is not required to pay an additional amount (other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a party consolidating or amalgamating with, or merging with or into, or transferring all or substantially all its assets to, another entity (which will be the Affected Party) where such action does not constitute an event described in Section 5(a)(viii);

(iv) Credit Event Upon Merger . If “Credit Event Upon Merger” is specified in the Schedule as applying to the party, such party (“X”), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be, immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); or

(v) Additional Termination Event . If any “Additional Termination Event” is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or such Confirmation).

(c) Event of Default and Illegality . If an event or circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an Event of Default.

6. Early Termination

(a) Right to Terminate Following Event of Default . If at any time an Event of Default with respect to a party (the “Defaulting Party”) has occurred and is then continuing, the other party (the “Non-defaulting Party” may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all outstanding Transactions. If, however, “Automatic Early Termination” is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).

(b) Right to Terminate Following Termination Event .

(i) Notice . If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such other information about that Termination Event as the other party may reasonably require.

(ii) Transfer to Avoid Termination Event . If either an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected Party, the Affected Party will, as a condition to its right to designate an Early Termination Date under Section 6(b)(iv), use all reasonable efforts (which will not require such party to incur a loss, excluding immaterial, incidental expenses) to transfer within 20 days after it gives notice under Section 6(b)(i) all its rights and obligations under this Agreement in respect of the Affected Transactions to another of its Offices or Affiliates so that such Termination Event ceases to exist.

If the Affected Party is not able to make such a transfer it will give notice to the other party to that effect within such 20 day period, whereupon the other party may effect such a transfer within 30 days after the notice is given under Section 6(b)(i).

Any such transfer by a party under this Section 6(b)(ii) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party’s policies in effect at such time would permit it to enter into transactions with the transferee on the terms proposed.

(iii) Two Affected Parties . If an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event.

(iv) Right to Terminate . If:—

(1) a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case may be, has not been effected with respect to all Affected Transactions within 30 days after an Affected Party gives notice under Section 6(b)(i); or

(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party,

either party in the case of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then

continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions.

(i) If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event is then continuing.

(ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement. The amount, if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e).

(d) Calculations .

(i) Statement . On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid. In the absence of written confirmation from the source of a quotation obtained in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation.

(ii) Payment Date . An amount calculated as being due in respect of any Early Termination Date under Section 6(e) will be payable on the day that notice of the amount payable is effective (in the case of an Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which is designated as a result of a Termination Event). Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment) in the Termination Currency, from (and including) the relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed.

(e) Payments on Early Termination . If an Early Termination Date occurs, the following provisions shall apply based on the parties’ election in the Schedule of a payment measure, either “Market Quotation” or “Loss”, and a payment method, either the “First Method” or the “Second Method”. If the parties fail to designate a payment measure or payment method in the Schedule, it will be deemed that “Market Quotation” or the “Second Method”, as the case may be, shall apply. 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) Events of Default . If the Early Termination Date results from an Event of Default:—

(1) First Method and Market Quotation. If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non-defaulting Party the excess, if a positive number, of (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party.

(2) First Method and Loss. If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party’s Loss in respect of this Agreement.

(3) Second Method and Market Quotation. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the

Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.

(4) Second Method and Loss. If the Second Method and Loss apply, an amount will be payable equal to the Non-defaulting Party’s Loss in respect of this Agreement. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.

(ii) Termination Events . If the Early Termination Date results from a Termination Event:—

(1) One Affected Party. If there is one Affected Party, the amount payable will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and the party which is not the Affected Party, respectively, and, if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions.

(2) Two Affected Parties. If there are two Affected Parties:—

(A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable equal to (I) the sum of (a) one-half of the difference between the Settlement Amount of the party with the higher Settlement Amount (“X”) and the Settlement Amount of the party with the lower Settlement Amount (“Y”) and (b) the Termination Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing to Y; and

(B) if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be payable equal to one-half of the difference between the Loss of the party with the higher Loss (“X”) and the Loss of the party with the lower Loss (“Y”).

If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y.

(iii) Adjustment for Bankruptcy . In circumstances where an Early Termination Date occurs because “Automatic Early Termination” applies in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii).

(iv) Pre-Estimate . The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such amount is payable for the loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses.

7. Transfer

Subject to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, 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); and

(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).

Any purported transfer that is not in compliance with this Section will be void.

8. Contractual Currency

(a) Payment in the Contractual Currency . Each payment under this Agreement will be made in the relevant currency specified in this Agreement for that payment (the “Contractual Currency”). To the extent permitted by applicable law, any obligation to make payments under this Agreement in the Contractual Currency will not be discharged or satisfied by any tender in any currency other than the Contractual Currency, except to the extent such tender results in the actual receipt by the party to which payment is owed, acting in a reasonable manner and in good faith in converting the currency so tendered into the Contractual Currency, of the full amount in the Contractual Currency of all amounts payable in respect of this Agreement. If for any reason the amount in the Contractual Currency so received falls short of the amount in the Contractual Currency payable in respect of this Agreement, the party required to make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the Contractual Currency as may be necessary to compensate for the shortfall. If for any reason the amount in the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this Agreement, the party receiving the payment will refund promptly the amount of such excess.

(b) Judgments . To the extent permitted by applicable law, if any judgment or order expressed in a currency other than the Contractual Currency is rendered (i) for the payment of any amount owing in respect of this Agreement, (ii) for the payment of any amount relating to any early termination in respect of this Agreement or (iii) in respect of a judgment or order of another court for the payment of any amount described in (i) or (ii) above, the party seeking recovery, after recovery in full of the aggregate amount to which such party is entitled pursuant to the judgment or order, will be entitled to receive immediately from the other party the amount of any shortfall of the Contractual Currency received by such party as a consequence of sums paid in such other currency and will refund promptly to the other party any excess of the Contractual Currency received by such party as a consequence of sums paid in such other currency if such shortfall or such excess arises or results from any variation between the rate of exchange at which the Contractual Currency is converted into the currency of the judgment or order for the purposes of such judgment or order and the rate of exchange at which such party is able, acting in a reasonable manner and in good faith in converting the currency received into the Contractual Currency, to purchase the Contractual Currency with the amount of the currency of the judgment or order actually received by such party. The term “rate of exchange” includes, without limitation, any premiums and costs of exchange payable in connection with the purchase of or conversion into the Contractual Currency.

(c) Separate Indemnities . To the extent permitted by applicable law, these indemnities constitute separate and independent obligations from the other obligations in this Agreement, will be enforceable as separate and independent causes of action, will apply notwithstanding any indulgence granted by the party to which any payment is owed and will not be affected by judgment being obtained or claim or proof being made for any other sums payable in respect of this Agreement.

(d) Evidence of Loss . For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made.

9. Miscellaneous

(a) Entire Agreement . This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect thereto.

(b) Amendments . No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system.

(c) Survival of Obligations . Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction.

(d) Remedies Cumulative . Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law.

(e) Counterparts and Confirmations .

(i) This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original.

(ii) The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement. The parties will specify therein or through another effective means that any such counterpart, telex or electronic message constitutes a Confirmation.

(f) No Waiver of Rights . A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.

(g) Headings . The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement.

10. Offices; Multibranch Parties

(a) If Section 10(a) is specified in the Schedule as applying, each party that enters into a Transaction through an Office other than its head or home office represents to the other party that, notwithstanding the place of booking office or jurisdiction of incorporation or organisation of such party, the obligations of such party are the same as if it had entered into the Transaction through its head or home office. This representation will be deemed to be repeated by such party on each date on which a Transaction is entered into.

(b) Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of the other party.

(c) If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receive payments or deliveries under any Transaction through any Office listed in the Schedule, and the Office through which it makes and receives payments or deliveries with respect to a Transaction will be specified in the relevant Confirmation.

11. Expenses

A Defaulting Party will, on demand, indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support Document

to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection.

12. Notices

(a) Effectiveness . Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:—

(i) if in writing and delivered in person or by courier, on the date it is delivered;

(ii) if sent by telex, on the date the recipient’s answerback is received;

(iii) if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender’s facsimile machine);

(iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or

(v) if sent by electronic messaging system, on the date that electronic message is received,

unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day.

(b) Change of Addresses . Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system details at which notices or other communications are to be given to it.

13. Governing Law and Jurisdiction

(a) Governing Law . This Agreement will be governed by and construed in accordance with the law specified in the Schedule.

(b) Jurisdiction . With respect to any suit, action or proceedings relating to this Agreement (“Proceedings”), each party irrevocably:—

(i) submits to the jurisdiction of the English courts, if this Agreement is expressed to be governed by English law, or to the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this Agreement is expressed to be governed by the laws of the State of New York; and

(ii) waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party.

Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more jurisdictions preclude the bringing of Proceedings in any other jurisdiction.

(c) Service of Process . Each party irrevocably appoints the Process Agent (if any) specified opposite its name in the Schedule to receive, for it and on its behalf, service of process in any Proceedings. If for any

reason any party’s Process Agent is unable to act as such, such party will promptly notify the other party and within 30 days appoint a substitute process agent acceptable to the other party. The parties irrevocably consent to service of process given in the manner provided for notices in Section 12. Nothing in this Agreement will affect the right of either party to serve process in any other manner permitted by law.

(d) Waiver of Immunities . Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings.

14. Definitions

As used in this Agreement:—

“Additional Termination Event” has the meaning specified in Section 5(b).

“Affected Party” has the meaning specified in Section 5(b).

“Affected Transactions” means (a) with respect to any Termination Event consisting of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the occurrence of such Termination Event and (b) with respect to any other Termination Event, all Transactions.

“Affiliate” means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, “control” of any entity or person means ownership of a majority of the voting power of the entity or person.

“Applicable Rate” means:—

(a) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

(b) in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate;

(c) in respect of all other obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and

(d) in all other cases, the Termination Rate.

“Burdened Party” has the meaning specified in Section 5(b).

“Change in Tax Law” means the enactment, promulgation, execution or ratification of, or any change in or amendment to, any law (or in the application or official interpretation of any law) that occurs on or after the date on which the relevant Transaction is entered into.

“consent” includes a consent, approval, action, authorisation, exemption, notice, filing, registration or exchange control consent.

“Credit Event Upon Merger” has the meaning specified in Section 5(b).

“Credit Support Document” means any agreement or instrument that is specified as such in this Agreement.

“Credit Support Provider” has the meaning specified in the Schedule.

“Default Rate” means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1 % per annum.

“Defaulting Party” has the meaning specified in Section 6(a).

“Early Termination Date” means the date determined in accordance with Section 6(a) or 6(b)(iv).

“Event of Default” has the meaning specified in Section 5(a) and, if applicable, in the Schedule.

“Illegality” has the meaning specified in Section 5(b).

“Indemnifiable Tax” means any Tax other than a Tax that would not be imposed in respect of a payment under this Agreement but for a present or former connection between the jurisdiction of the government or taxation authority imposing such Tax and the recipient of such payment or a person related to such recipient (including, without limitation, a connection arising from such recipient or related person being or having been a citizen or resident of such jurisdiction, or being or having been organised, present or engaged in a trade or business in such jurisdiction, or having or having had a permanent establishment or fixed place of business in such jurisdiction, but excluding a connection arising solely from such recipient or related person having executed, delivered, performed its obligations or received a payment under, or enforced, this Agreement or a Credit Support Document).

“law” includes any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority) and “lawful” and “unlawful” will be construed accordingly.

“Local Business Day” means, subject to the Schedule, a day on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) (a) in relation to any obligation under Section 2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so specified, as otherwise agreed by the parties in writing or determined pursuant to provisions contained, or incorporated by reference, in this Agreement, (b) in relation to any other payment, in the place where the relevant account is located and, if different, in the principal financial centre, if any, of the currency of such payment, (c) in relation to any notice or other communication, including notice contemplated under Section 5(a)(i), in the city specified in the address for notice provided by the recipient and, in the case of a notice contemplated by Section 2(b), in the place where the relevant new account is to be located and (d) in relation to Section 5(a)(v)(2), in the relevant locations for performance with respect to such Specified Transaction.

“Loss” means, with respect to this Agreement or one or more Terminated Transactions, as the case may be, and a party, the Termination Currency Equivalent of an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position (or any gain resulting from any of them). Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made (assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or 6(c)(ii)(2)(A) applies. Loss does not include a party’s legal fees and out-of-pocket expenses referred to under Section 11. A party will determine its Loss as of the relevant Early Termination Date, or, if that is not reasonably practicable, as of the earliest date thereafter as is reasonably practicable. A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets.

“Market Quotation” means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the “Replacement Transaction”) that would have the effect of preserving for such party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have

been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated 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. The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date. The day and time as of which those quotations are to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(e), and, if each party is so obliged, after consultation with the other. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, it will be deemed that the Market Quotation in respect of such Terminated Transaction or group of Terminated Transactions cannot be determined.

“Non-default Rate” means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount.

“Non-defaulting Party” has the meaning specified in Section 6(a).

“Office” means a branch or office of a party, which may be such party’s head or home office.

“Potential Event of Default” means any event which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.

“Reference Market-makers” means four leading dealers in the relevant market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city.

“Relevant Jurisdiction” means, with respect to a party, the jurisdictions (a) in which the party is incorporated, organised, managed and controlled or considered to have its seat, (b) where an Office through which the party is acting for purposes of this Agreement is located, (c) in which the party executes this Agreement and (d) in relation to any payment, from or through which such payment is made.

“Scheduled Payment Date” means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction.

“Set-off” means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an amount under Section 6 is entitled or subject (whether arising under this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer.

“Settlement Amount” means, with respect to a party and any Early Termination Date, the sum of:—

(a) the Termination Currency Equivalent of the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and

(b) such party’s Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result.

“Specified Entity” has the meaning specified in the Schedule.

“Specified Indebtedness” means, subject to the Schedule, any obligation (whether present or future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money.

“Specified Transaction” means, subject to the Schedule, (a) any transaction (including an agreement with respect thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party or any applicable Specified Entity of such party) and the other party to this Agreement (or any Credit Support Provider of such other party or any applicable Specified Entity of such other party) which is a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions), (b) any combination of these transactions and (c) any other transaction identified as a Specified Transaction in this Agreement or the relevant confirmation.

“Stamp Tax” means any stamp, registration, documentation or similar tax.

“Tax” means any present or future tax, levy, impost, duty, charge, assessment or fee of any nature (including interest, penalties and additions thereto) that is imposed by any government or other taxing authority in respect of any payment under this Agreement other than a stamp, registration, documentation or similar tax.

“Tax Event” has the meaning specified in Section 5(b).

“Tax Event Upon Merger” has the meaning specified in Section 5(b).

“Terminated Transactions” means with respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of the notice designating that Early Termination Date (or, if “Automatic Early Termination” applies, immediately before that Early Termination Date).

“Termination Currency” has the meaning specified in the Schedule.

“Termination Currency Equivalent” means, in respect of any amount denominated in the Termination Currency, such Termination Currency amount and, in respect of any amount denominated in a currency other than the Termination Currency (the “Other Currency”), the amount in the Termination Currency determined by the party making the relevant determination as being required to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Market Quotation or Loss (as the case may be), is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spot exchange rate of the foreign exchange agent (selected as provided below) for the purchase of such Other Currency with the Termination Currency at or about 11:00 a.m. (in the city in which such foreign exchange agent is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency for value on the relevant Early Termination Date or that later date. The foreign exchange agent will, if only one party is obliged to make a determination under Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties.

“Termination Event” means an Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a Credit Event Upon Merger or an Additional Termination Event.

“Termination Rate” means a rate per annum equal to the arithmetic mean of the cost (without proof or evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts.

“Unpaid Amounts” owing to any party means, with respect to an Early Termination Date, the aggregate of (a) in respect of all Terminated Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early Termination Date and which remain unpaid as at such Early Termination Date and (b) in respect of each Terminated Transaction, for each obligation under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be settled by delivery to such party on or prior to such Early Termination Date and which has not been so settled as at such Early Termination Date, an amount equal to the fair market

value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery, in each case together with (to the extent permitted under applicable law) interest, in the currency, of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but excluding) such Early Termination Date, at the Applicable Rate. Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed. The fair market value of any obligation referred to in clause (b) above shall be reasonably determined by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the Termination Currency Equivalents of the fair market values reasonably determined by both parties.

IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect from the date specified on the first page of this document.

DEXIA S.A.		FSA ASSET MANAGEMENT LLC


By:		By:
	Name:		Name:
	Title:		Title:


DEXIA CRÉDIT LOCAL SA


By:
	Name:
	Title:

Guaranteed Put ISDA Master Agreement

Exhibit 10.3.2

Execution Version

SCHEDULE

to the

1992 MASTER AGREEMENT

Guaranteed Put Contract

dated as of June 30, 2009

among:	DEXIA SA (“Dexia”),

	DEXIA CRÉDIT LOCAL S.A. (“DCL” and, together with Dexia, the “Party A”), jointly and severally;

and	FSA ASSET MANAGEMENT LLC (“Party B”)

Part 1. Termination Provisions

(a) The “Failure to Pay or Deliver” provisions of Section 5(a)(i)

(i) will apply to Party A but are modified with respect to Party A to read as follows:

“failure by the party to make, when due, either (I) any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or (II) any payment or delivery under the Credit Support Annex required to be made by it if (A) such failure to make payments or deliveries (taken together with any other outstanding and uncured failures to make payments or deliveries by Party A or its Affiliates in relation to Dexia Payment Obligations) exceeds the Default Threshold and is not remedied within the Cure Period identified under and in the manner described in the Pledge and Administration Agreement following delivery of a Payment Failure Notice to Party A and (B) (x) the relevant payment failed to be made by Party A (or a payment for the Value of any failed delivery of Eligible Collateral) cannot be claimed from the Sovereign Guarantors under the Sovereign Guarantee, (y) the Sovereign Guarantors have failed to perform their payment obligations in relation thereto in a timely manner pursuant to the terms of the Sovereign Guarantee or (z) a Sovereign Guarantee Unenforceability Date has occurred”; and

(ii) will not apply to Party B.

“ Pledge and Administration Agreement ” means the Pledge and Administration Agreement, dated as of June 30, 2009, among Dexia, DCL, Dexia Bank Belgium SA, Financial Security Assurance Inc., Party B, FSA Portfolio Asset Limited, Dexia FP Holdings Inc., FSA Capital Markets Services LLC, FSA Capital Management Services LLC, FSA Capital Markets Services (Caymans) Ltd. and The Bank of New York Mellon Trust Company, National Association, as the same may be amended, supplemented or modified from time to time.

“ Priority of Payments ” has the meaning defined in the Pledge and Administration Agreement.

“ Sovereign Guarantee Unenforceability Date ” means any date prior to the Preference Extension Date on which a court of Belgium or France or a supranational or international body, in each case exercising appropriate jurisdiction, has made a final and nonappealable determination ( décision ayant en force de chose jugée ) that the Sovereign Guarantee is invalid, not binding or unenforceable against either the Belgian State or the French State. “Preference Extension Date” means the date occurring six months (or the time period of any longer suspect, preference or hardening period as may then be in effect under applicable law) following the Liquidity and Collateral Trigger Expiration Date.

Each of DCL and Dexia covenants and agrees that it will not initiate or join, and will not permit any of its respective Affiliates to initiate or join, any litigation or proceeding to question the validity or enforceability of the Sovereign Guarantee, or make a pleading or stipulation in any such proceeding that would question the validity or enforceability of the Sovereign Guarantee.

“ Sovereign Guarantors ” means the Belgian State and the French State.

“ Sovereign Guarantee ” means the First Demand Guarantee dated June 30, 2009, issued by the Sovereign Guarantors under which the Sovereign Guarantors guarantee the joint and several payment obligations of Dexia under this Agreement.

Capitalized terms used and not defined herein have the meanings assigned in the Pledge and Administration Agreement or if not defined therein, in the Confirmation dated of even date herewith and captioned “Guaranteed Put Contract” (the “ Confirmation ”).

(b) The “Credit Support Default” provisions of Section 5(a)(iii) will not apply to Party A or to Party B (without prejudice to the application of Section 5(a)(i) as amended hereby to payments or deliveries required to be made by Party A under the Credit Support Annex).

(c) Prior to the earlier of (x) March 30, 2035 and (y) any Sovereign Guarantee Unenforceability Date (the “ Bankruptcy Coverage Expiration Date ”), the “Bankruptcy” provisions of Section 5(a)(vii) will not apply to Party A except where (x) a Dexia Bankruptcy has occurred, (y) Party A has failed to pay the Put Settlement Amount following exercise of the Put Option pursuant to the Bankruptcy Trigger, and (z) the Sovereign Guarantors have failed to perform their payment obligations in relation to such Put Settlement Amount in a timely manner pursuant to the terms of the Sovereign Guarantee.

From and after the Bankruptcy Coverage Expiration Date, the “Bankruptcy” provisions of Section 5(a)(vii) will apply to Party A only where a Dexia Voluntary/Involuntary Bankruptcy has occurred.

Section 5(a)(vii) will not apply to Party B.

“ Dexia Bankruptcy ” means the occurrence with respect to Dexia of an event described in Section 5(a)(vii), provided, however, that on or before the Bankruptcy Coverage Expiration Date, for purposes of determining whether a “Bankruptcy Trigger” shall have occurred under the Confirmation, subclause (4) of Section 5(a)(vii) shall be amended to read as follows: “(4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation.”

“ Dexia Voluntary/Involuntary Bankruptcy ” means the occurrence with respect to Dexia of an event described in Section 5(a)(vii), provided, however, that, subclause (4) of Section 5(a)(vii) shall be amended so that the reference to “30 days” in subclause (4)(B) of Section 5(a)(vii) shall refer to “60 days”.

For the avoidance of doubt, the occurrence only with respect to DCL, and not with respect to Dexia, of an event described in Section 5(a)(vii) does not constitute a Dexia Bankruptcy or Dexia Voluntary/Involuntary Bankruptcy.

(d) Section 5(a)(vi) ( Cross Default ) will not apply to Party B and will apply to Party A, provided that with respect to Party A, Section 5(a)(vi) will be deleted in its entirety and replaced with the following:

“the occurrence of any Dexia Event of Default (other than an Event of Default under Section 5(a) as modified by the Schedule) either (A) prior to the earlier of (x) the Liquidity and Collateral Trigger Expiration Date and (y) the Sovereign Guarantee Unenforceability Date, which Dexia Event of Default has continued through such earlier date, or (B) on or after the earlier of (x) the Liquidity and Collateral Trigger Expiration Date and (y) the Sovereign Guarantee Unenforceability Date.”

“ Dexia Event of Default ” has the meaning specified in the Pledge and Administration Agreement.

(e) Section 5(a)(ii) (Breach of Agreement), Section 5(a)(iv) (Misrepresentation), Section 5(a)(v) (Default Under Specified Transaction) and Section 5(a)(viii) (Merger Without Assumption) will not apply to Party A or Party B.

(f) “Specified Entity” will not apply in relation to either Party A or Party B.

(g) “Termination Events”. The provisions of Section 5(b) will not apply to Party A or Party B.

(h) The “Automatic Early Termination” provision of Section 6(a) will not apply to Party A prior to the Bankruptcy Coverage Expiration Date, and thereafter will apply to Party A. Section 6(a) will not apply to Party B at any time. Party B may not declare an Early Termination Date prior to the Bankruptcy Coverage Expiration Date without written consent from FSA permitting it to do so, provided that Party B shall declare an Early Termination Date at the direction of FSA in accordance with Section 5.2(a)(iv) of the Pledge and Administration Agreement, and any purported declaration by Party B without the prior written consent of FSA shall be void ab initio and of no effect.

(i) “Payments on Early Termination. Notwithstanding anything to the contrary in Section 6(e) of this Agreement, the amount payable by Party A in respect of any Early Termination Date shall be an amount equal to the sum of (x) all net Unpaid Amounts (subject to the delivery to Party A of any Put Settlement Assets corresponding to any Put Settlement Amounts included in Unpaid Amounts), plus (y) the applicable Exposure as determined by the Valuation Agent under the Credit Support Annex as of such Early Termination Date. Notwithstanding anything to the contrary in Section 6(e), no amounts will be payable by Party B in respect of any Early Termination Date.

(j) “Termination Currency” means U.S. Dollars.

(k) “Additional Termination Events” will not apply.

Part 2. Tax Representations

Payer Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B will each make the following Payer Representation:

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) of this Agreement) to be made by it to the other party under this Agreement. In making this representation, it may rely on (i) the accuracy of any representations made by the other party pursuant to Section 3(f) of this Agreement, (ii) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and effectiveness of any document provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and (iii) the satisfaction of the agreement of the other party contained in Section 4(d) of this Agreement, 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 to its legal or commercial position.

Payee Representations. For the purpose of Section 3(f) of this Agreement, (i) Dexia represents that it is a company duly organized under the laws of Belgium, (ii) DCL represents that it is Party B represents that it is a limited liability company organized under the law of the State of Delaware.

Part 3. Agreements to Deliver Documents

For the purpose of Sections 4(a)(i) and (ii) of this Agreement, each party agrees to deliver the following documents, as applicable:

(a) Tax forms, documents or certificates to be delivered are:

Party required to deliver document	Form/Document/ Certificate	Date by which to be delivered

Party A and Party B	Any form, document or certificate reasonably required by the other party to enable it to pay free of or at a reduced rate of withholding tax	As soon as practicable after written request is made

(b) Other documents to be delivered are:

Party required to deliver document	Form/Document/ Certificate	Date by which to be delivered	Covered by Section 3(d) Representation

Party A and Party B	Certificate or other documents evidencing the capacity of the party to enter into this Agreement and the Transaction hereunder and the authority of the person(s) executing this Agreement or a Confirmation, as the case may be.	On or before execution of this Agreement.	No

Party A	Consolidated annual financial statements of Dexia, prepared in accordance with generally accepted accounting principles in the country in which the party is organized.	Promptly after request (unless publicly available on the website of Dexia)	No

Party A	Each Credit Support Document	On or before execution of this Agreement	No

Party A	A legal opinion as to enforceability of this Agreement and the Confirmation evidencing the Transaction hereunder.	On or before execution of this Agreement.	No

Part 4. Miscellaneous

(a)	Addresses for Notices . For the purpose of Section 12(a) of this Agreement:

	Address for notices or communications to Party A:

	Dexia Crédit Local, New York branch
	445 Park Avenue
	7 th Floor
	New York, New York 10022

	And

	Dexia SA
	Place Rogier 11
	B-1210 Brussels
	Belgium
	Attn.: Secretary General
	e-mail: secretarygeneral@dexia.com and olivier.vanherstraeten@dexia.com
	Telephone: +32-2-213.57.42 or +32-2-213.50.43
	Telecopy No: +32-2-213.58.90

	with a copy to:

	Dexia Crédit Local, head office
	Address: Dexia Crédit Local
	Tour Dexia Défense 2
	1, Passerelle des Reflets
	TSA 92202
	92919 La Défense Cedex
	Attention: Tax and Legal Director
	Facsimile No: +33 1 58 58 69 90
	Telephone No.: +33 1 58 58 58 70

	Address for notices or communications to Party B:

	As set forth in the Pledge and Administration Agreement.

	Address for notices or communications to FSA:

	As set forth in the Pledge and Administration Agreement.

(b)	Process Agent . For the purpose of Section 13(c) of this Agreement:

	Party A appoint
	as their Process Agent:	Dexia Crédit Local, New York branch
		445 Park Avenue
		7 th Floor
		New York, New York 10022

(c) Offices . The provisions of Section 10(a) will apply to Party A and Party B. In furtherance, and not in limitation, of Section 10(a) of this Agreement, DCL irrevocably agrees that, if and to the extent that it enters into any Transaction or Transactions hereunder through an Office other than its head or home office (including, without limitation, its New York Branch), its obligations to Party B in connection with such Transaction or Transactions shall be the same as if it had entered into such Transaction or Transactions through its head or home office; and if any or all of the claims of Party B against such other Office in connection with such Transaction or Transactions are, in connection with any insolvency, bankruptcy or other similar proceedings relating to such other Office, disallowed as against such other Office by virtue of any law or rule disallowing, or permitting the disallowance of, any such claim or claims in any such proceedings by reason of the fact that Party B is (or was) an Affiliate of DCL (including, without limitation, Section 606.4(a) of the New York Banking Law), then such disallowance shall not affect the obligations of DCL hereunder in relation to such Transaction or Transactions or the right of Party B to enforce such obligations against the head or home office of DCL, or any rights of Party B under the Credit Support Annex hereto.

(d) Multibranch Party . For the purpose of Section 10(c):

DCL is a Multibranch Party and may act through its New York branch or Paris Head Office.

Dexia and Party B are not Multibranch Parties.

(e) Calculation Agent . As specified in the Confirmation.

(f) Credit Support Documents. Details of Credit Support Documents and the Sovereign Guarantee:

Party A: The Credit Support Annex hereto and the Sovereign Guarantee .

Party B: Not applicable.

(g) Credit Support Provider. Credit Support Provider means

in relation to Party A: Prior to the expiration of the term of the Sovereign Guarantee, the Sovereign Guarantors

in relation to Party B: None

(h) Nontransferability . Section 7 is replaced with the following:

“Neither this Agreement nor any interest or obligation in or under this Agreement or the Sovereign Guarantee may be transferred (whether by way of security or otherwise) by Party B without the consent of Party A, FSA and the Sovereign Guarantors, other than (x) to pledge such rights to the Collateral Agent as part of the FSAM Collateral, or (y) pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (an “Party B Merger”) where FSA and the Sovereign Guarantors have given their consent to such Party B Merger (but without prejudice to any other right or remedy under this Agreement).

Neither this Agreement nor any interest or obligation in or under this Agreement or the Sovereign Guarantee may be transferred (whether by way of security or otherwise) by Dexia or DCL without the prior written consent of Party B, the Sovereign Guarantors, and FSA, other than pursuant to a consolidation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (a “ Corporate Reorganization ”), provided that the Remedies

Nonimpairment Condition (as defined in the Pledge and Administration Agreement) is satisfied in relation to such Corporate Reorganization.

FSA will not have the right to transfer any of its rights under this Agreement without the consent of Party A and the Sovereign Guarantors, except pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of all or substantially all FSA’s assets to, another entity (but without prejudice to any other right or remedy under this Agreement).

Any purported transfer that is not in compliance with this Section will be void.”

(i) Governing Law; Exclusive Jurisdiction .

(i) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK AND THE MANDATORY CHOICE OF LAW RULES CONTAINED IN THE UCC.

(ii) Section 13(b) is hereby deleted and replaced by the following:

“Each of the parties hereto hereby irrevocably submits to the exclusive jurisdiction of any U.S. federal or state court in The City of New York for the purpose of any suit, action, proceeding or judgment arising out of or relating to this Agreement. Each of the parties hereto hereby consents to the laying of venue in any such suit, action or proceeding in New York County, New York, and hereby irrevocably waives any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum and agrees not to plead or claim the same. Notwithstanding the foregoing, nothing contained in this Agreement shall limit or affect the rights of any party hereto to exercise remedies under this Agreement or any of the other Transaction Documents (as defined in the Pledge and Administration Agreement), or to enforce any judgment with respect thereto, in any jurisdiction or venue.”

(j) Netting of Payments . Section 2(c) of this Agreement will not apply.

(l) “Affiliate” will have the meaning specified in Section 14 of this Agreement.

(m) Set-off . The rights and obligations of the parties hereunder shall not be subject to, and shall not form the basis for, any rights of setoff arising from a transaction not subject to this Agreement; provided , that if on any day there are amounts in the same currency payable both by Party A to Party B and by Party B to Party A, in accordance with the Priority of Payments, such amounts may be set off against one another and only a single net amount transferred by Party A to Party B, or by Party B to Party A, as the case may be.

(n) Relationship Between Parties . Each party will be deemed to represent to the other party on the date on which it enters into a Transaction that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary for that Transaction):

(i) Non-Reliance . It is acting for its own account, and it has made its own independent decisions to enter into that Transaction and as to whether that Transaction is appropriate or proper for it is based upon its own judgement and upon advice from such advisers as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into that Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be

considered investment advice or a recommendation to enter into that 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.

(ii) 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.

(iii) Status of Parties . The other party is not acting as a fiduciary for or an adviser to it in respect of that Transaction.

Part 5. Other Provisions .

(a) No Agency . Each of Party A and Party B is entering into this Agreement and each Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise).

(b) Assignment and Pledge Under the Pledge and Administration Agreement . Party A acknowledges and consents to Party B’s grant of all its right, title and interest in, to and under, in each case, whether now owned or existing, or hereafter acquired or arising, this Agreement or any Transaction hereunder (including, without limitation, its right to payments due to it hereunder or with respect hereto), to the Collateral Agent pursuant to and in accordance with the terms of the Pledge and Administration Agreement, for the benefit of the persons identified therein. Party B hereby irrevocably appoints the Collateral Agent and FSA as its agents and attorneys-in-fact for enforcing its rights hereunder upon the events and in the manner specified in the Pledge and Administration Agreement, which appointment is coupled with an interest, and Party B confirms that notice of such appointment has been effectively given to the Collateral Agent and FSA. Party A agrees that, unless notified in writing by the Collateral Agent of other payment instructions (or as otherwise provided in the Credit Support Annex with respect to transfers of Eligible Collateral), any and all amounts payable by Party A to Party B under this Agreement will be paid to the FSAM Cash Account, at such account as the Collateral Agent specifies in writing to Party A.

Party A and Party B acknowledge and agree that FSA may directly enforce the rights of Party B under this Agreement (A) at any time that it is the Secured Party Representative or (B) in the circumstances specified in this Agreement (including the Schedule, Confirmation and Credit Support Annex), without prejudice to or limitation of any rights given to FSA as a third party beneficiary under this Agreement. Party B hereby irrevocably designates FSA its agent and attorney-in-fact for purposes of enforcing such rights, which designation is coupled with an interest.

modification, supplement, termination of any provision of this Agreement or any of the Schedule, the Confirmation or the Credit Support Annex entered into by Party A and Party B, or any waiver or consent to any departure by Party A from any provision of this Agreement or any of the Schedule, the Confirmation or the Credit Support Annex granted by Party B without the prior written consent of FSA shall be void ab initio .

(d) Third Party Beneficiaries . Nothing in this Agreement expressed or implied, shall give to any person, other than the parties hereto and their successors hereunder and FSA (which shall be an express third party beneficiary of this Agreement), any benefit or any legal or equitable right, remedy or claim under this Agreement; provided, however that the parties hereto acknowledge and agree that the Sovereign Guarantors shall each be an express third party beneficiary of Part 4(i) with the right to enforce any rights or remedies thereunder to the same extent as if the Sovereign Guarantors were parties to this Agreement.

(e) Waiver of Jury Trial . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION.

(f) Single Transaction. Each party acknowledges and agrees that the Transaction evidenced by the Confirmation dated as of the date hereof will be the only Transaction governed by this Agreement.

(g) Non-Petition . DCL and Dexia each agrees that it will not, prior to the Senior Release Date (as defined in the Pledge and Administration Agreement), acquiesce, petition or otherwise institute against, or join any other person in instituting against, Party B, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy, or similar law, including without limitations proceedings seeking to appoint a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of Party B or any substantial part of its property; provided , that this provision shall not restrict or prohibit Dexia or DCL from joining any such proceedings which shall have already commenced under applicable laws and not in violation of this provision. This provision shall survive the termination of this Agreement for any reason.

(h) Limited Recourse. The obligations of Party B in relation to this Agreement and any Transaction hereunder are limited recourse obligations, payable solely from the proceeds of the FSAM Collateral (as defined in the Pledge and Administration Agreement) available under and applied in accordance with the Priority of Payments set forth in the Pledge and Administration Agreement. Upon application of the FSAM Collateral and proceeds thereof available to satisfy the obligations of Party B hereunder in accordance with the Pledge and Administration Agreement, Dexia and DCL shall not be entitled to take any further steps against Party B to recover any sums due and shall not constitute a claim against Party B to the extent of any insufficiency. No recourse shall be had for the payment of any amounts owing in respect of this Agreement against any officer, director, employee, stockholder, member or incorporator of Party B. This provision shall survive the termination of this Agreement for any reason.

(i) Bankruptcy Code Acknowledgment . Each of Party A and Party B agrees and acknowledges that this Agreement is:

termination, netting and collateral liquidation provisions hereof are intended to be among those excepted from the automatic stay under Section 362(b)(6) of the United States Bankruptcy Code; and (3) each transfer, payment and delivery hereunder or in connection herewith is intended to be a “margin payment”, as defined in Section 741(5) of the United States Bankruptcy Code, and/or a “settlement payment” as defined in Section 741(8) of the United States Bankruptcy Code, under a securities contract, and is therefore, under Section 546(e) of the United States Bankruptcy Code, not avoidable; and

(B) intended to be a “swap agreement,” as such term is defined in Section 101(53B) of the Bankruptcy Code, with respect to which: (1) the contractual rights of Party B hereunder to cause the liquidation, termination or acceleration of a securities contract are intended to be among those protected under Section 560 of the United States Bankruptcy Code; (2) the termination, netting and collateral liquidation provisions hereof are intended to be among those excepted from the automatic stay under Section 362(b)(17) of the United States Bankruptcy Code; and (3) each transfer, payment and delivery hereunder or in connection herewith is intended to be a transfer under or in connection with a swap agreement and is therefore, under Section 546(g) of the United States Bankruptcy Code, not avoidable.

(j) NY Banking Law Acknowledgment . Each of Party A and Party B agrees and acknowledges that this Agreement is intended to be a “qualified financial contract” as such term is defined in Section 618-a of the New York Banking Law (NYBL).

(k) French Monetary and Financial Code Acknowledgment . Each of Party A and Party B agrees and acknowledges that (A) this Agreement constitutes a financial agreement ( contrat financier ) as such term is defined under article L. 211-1 and D. 211-1 A of the French Monetary and Financial Code, (B) each transaction contemplated by this Agreement constitutes a transaction on financial instruments ( opération sur instruments financiers ) within the meaning of article L.211-36 and L.211-1 of the French Monetary and Financial Code, (C) each of Party A and Party B is an entity falling within the scope of article 211-36 1° of the French Monetary and Financial Code.

(l) Belgian Code Acknowledgment . Each of Party A and Party B agrees and acknowledges that the Collateral Support Annex and any pledge agreement entered into with respect to the MPAA Account (as defined in the Credit Support Annex) are financial collateral arrangements ( zakelijke zekerheidsovereenkomsten / conventions constitutives de sûreté réelle ) and this Agreement and any Transactions hereunder constitute a “netting agreement” ( nettingovereenkomst/convention de netting ) as such terms are defined in Article 3 of the Belgian Act of 15 December 2004 on financial collateral arrangements and several tax dispositions in relation to security collateral arrangements and loans of financial instruments.

(m) No Gross Up by Party B .

(i) Section 2(d)(i)(4) is hereby deleted and replaced by the following:

“(4) (A) If Party A is the party so required to deduct or withhold, then Party A shall make such additional payment as is necessary to ensure that the net amount actually received by Party B (free and clear of all Taxes, whether assessed against it or Party B) will equal the full amount Party B would have received had no such deduction or withholding been required; and

(B) if Party B is the party so required to deduct or withhold, then Party B shall make the relevant payment subject to such deduction or withholding and Party B will not be required to gross up.

For the avoidance of doubt, the fact that any payment is made by Party B subject to the provisions of (B) above shall at no time affect the obligations of Party A under (A) above.”

(ii) 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 and in relation to payments by Party B, no Tax shall be an Indemnifiable Tax.

(n) Payments by DCL . Any cash payments (“ Pre-Collateral Posting Payments ”) required to be made by Party A under this Agreement on or prior to the date on which (i) the Collateral Replacement Date has occurred and (ii) Eligible Collateral having a Value equal to the Delivery Amount determined on the Collateral Replacement Date shall have been Transferred under the Credit Support Annex, shall be considered paid for purposes of this Agreement (including without limitation Section 5(a)(i)) only if payment is made to Party B by DCL (and not by Dexia), provided that (A) payments by the Sovereign Guarantors under the Sovereign Guarantee shall always be considered to have been paid for purposes of this Agreement (including without limitation Section 5(a)(i)) notwithstanding that they are made in respect of a guarantee of the obligations of Dexia and (B) this provision shall not prejudice (i) any rights of Party B to enforce Dexia’s obligation to make payment of Pre-Collateral Posting Payments at Party B’s election, (ii) any rights of Party B against Dexia or DCL arising from nonpayment of Pre-Collateral Posting Payments by DCL or (iii) any rights and remedies as between Dexia and DCL in relation to their joint and several obligations under this Agreement.

(o) FSAM Lien Release Date . If an FSAM Lien Release Date has occurred as defined in the Pledge and Administration Agreement, then pursuant to Section 2.5(d) of the Pledge and Administration Agreement and notwithstanding the rights of FSA as third party beneficiary hereunder or the other provisions of this Agreement or the Confirmation relating to rights of the Collateral Agent and FSA, this Agreement and the Confirmation may be amended by Party A and Party B, with the consent of the Sovereign Guarantors, to disapply provisions relating to the rights of the Collateral Agent and FSA for purposes of transactions occurring or rights accruing under this Agreement after the FSAM Lien Release Date.

(p) Sovereign Guarantee Termination . Party A and FSAM agree for the benefit of FSA that Party A and FSAM shall not enter into any agreement with the Sovereign Guarantors for an optional termination of the Sovereign Guarantee unless the Collateral Agent has confirmed that the FSAM Lien Release Date has occurred.

The parties executing the Schedule have executed the Master Agreement and have agreed as to the contents of this Schedule.

Yours faithfully,

FSA ASSET MANAGEMENT LLC


By:
	Name:
	Title:


DEXIA SA


By:
	Name:
	Title:

DEXIA CREDIT LOCAL S.A.


By:
	Name:
	Title:

Guaranteed Put Schedule

Exhibit 10.3.3

EXECUTION VERSION

PUT OPTION CONFIRMATION

Guaranteed Put Contract

DATE:	June 30, 2009

TO:	FSA Asset Management LLC

FROM:	Dexia SA
	Dexia Crédit Local S.A.

SUBJECT:	Put Option Transaction

The purpose of this communication is to set forth the terms and conditions of the above referenced transaction entered into on the Trade Date specified below (the “ Put Option Transaction ”) between Dexia SA (“Dexia”) and Dexia Crédit Local S.A., acting through its New York Branch (“DCL”) , jointly and severally (“ Party A ”) and FSA Asset Management LLC (“ Party B ”). This communication constitutes a “Confirmation” as referred to in the Agreement specified below.

This Confirmation supplements, forms a part of and is subject to the ISDA Master Agreement dated as of June 30, 2009 (including the Schedule and Credit Support Annex thereto (each captioned “ Guaranteed Put Contract ”) as amended and supplemented from time to time (the “ Agreement ”) between Party A and Party B. Capitalized terms used and not defined herein have the meanings set forth in the Agreement. All provisions contained in, or incorporated by reference to, the Agreement shall govern this Confirmation except as expressly modified below.

This Confirmation is subject to, and incorporates the 2000 ISDA Definitions (the “ 2000 Definitions ”), as published by the International Swaps and Derivatives Association, Inc. Notwithstanding the foregoing, Articles 11 and 12 of the 2000 Definitions shall not apply. In the event of any inconsistency between this Confirmation, the 2000 Definitions, or the Agreement, as the case may be, this Confirmation will control for purposes of this Put Option Transaction.

1.	General Terms :

	Trade Date :	June 30, 2009

	Effective Date :	June 30, 2009

Scheduled Termination Date :	The last to occur of:

	(a)	the expiration of any applicable preference period following the last Effective Maturity Date;

	(b)	the expiration of any applicable preference period following the last Shortfall Payment Date;

	(c)	the expiration of any applicable preference period following the last Put Settlement Date;

	(d)	the expiration of any applicable preference period following the date on which no Put Portfolio Assets remain in the Put Portfolio Annex.

		The “Term” of this Transaction shall begin on and include the Effective Date and end on and include the Scheduled Termination Date.

Calculation Agent :	The Calculation Agent will be HF Services LLC, provided that if HF Services LLC is no longer acting as Administrator, Party A, Party B and FSA shall agree in good faith on a successor Calculation Agent, and pending such agreement the Reporting Agent shall act as successor Calculation Agent.

Calculation Agent City :	New York

Business Day :	Brussels, New York and Paris.

Business Day Convention :	Following (which, with the exception of the Effective Date, any Final Amortization Date, each Put Portfolio Asset Payment Date and the period end date of each Put Portfolio Asset Calculation Period, shall apply to any date referred to in this Confirmation that falls on a day that is not a Business Day) .

Put Portfolio Assets:	The assets identified in Annex 1 hereto (the “ Put Portfolio Annex ”), each of which was included in the total balance sheet assets of Party B as at September 30, 2008 (each a “ Put Portfolio Asset ” and the portfolio of assets so designated the “ September 30 Put Portfolio ”).

	The Put Portfolio Annex shall identify the following information in relation to the September 30 Put Portfolio and each Put Portfolio Asset: Issuer; CUSIP/ISIN; FSAM ID Number; Insurer; Put Portfolio Asset; Applicable Percentage; Legal Final Maturity Date; Initial Face Amount; Original Principal Amount; Initial Factor; Underlying Policy.

		Each of (a) any Put Portfolio Asset in relation to which a Put Settlement Date has occurred, (b) any Put Portfolio Asset sold by Party B from time to time (other than under repurchase agreements as described in (ii) under “Representation as to Exposure” below) and (c) any Put Portfolio Asset in relation to which a Call Settlement Date has occurred, will cease to constitute a Put Portfolio Asset hereunder upon receipt of payment by or on behalf of Party B in respect of such Put Portfolio Asset and (in the case of (a) and (c)) delivery of such Put Portfolio Asset pursuant to this Transaction, and will be deemed excluded from the Put Portfolio Annex and cease to be eligible for further delivery by Party B under the Put Option or Call Option documented hereby, to the extent of the portion of the Outstanding Principal Amount of the Put Portfolio Asset subject to such Put Settlement Date or sale or Call Settlement Date, effective as of such Put Settlement Date, date of such sale or such Call Settlement Date, as applicable.

2.	Put Premium Payments:

	Put Premium Payer :	Party B

	Put Premium Rate :	.25% per annum.

	Put Premium Period End Date :	Each June 30, September 30, December 31 or March 31.

	Put Premium Calculation Periods:	Each period from (and including) a Put Premium Period End Date (or in the case of the first Put Premium Calculation Period, the Effective Date) to (but excluding) the next Put Premium Period End Date (or in the case of the last Put Premium Calculation Period, the Scheduled Termination Date).

	Put Premium Payment Dates :	The third Business Day after each Put Premium Period End Date.

		On each Put Premium Payment Date, Party B shall pay to Party A the Put Premium Amount determined for the Put Premium Calculation Period ending on the Put Premium Period End Date immediately preceding such Put Premium Payment Date, subject to funds being available for such distribution under the Priority of Payments.

	Put Premium Amount :	With respect to any Put Premium Payment Date, an amount equal to the product of:

		(a)	the Put Premium Rate;

		(b)	an amount determined by the Calculation Agent equal to:

			(i)	the aggregate Outstanding Principal Amount of the Put Portfolio Assets as at 5:00 p.m. in the Calculation Agent City on each day in the applicable Put Premium Calculation Period; divided by

			(ii)	the actual number of days in the applicable Put Premium Calculation Period; and

		(c)	the actual number of days in the applicable Put Premium Calculation Period divided by 360.

3.	Put Triggers and Put Settlement

	Put Option:	Party A hereby grant Party B a put option in relation to each Put Portfolio Asset exercisable in accordance with the terms hereof upon the occurrence of a relevant Put Trigger at any time during the Term of this Put Option Transaction (the “ Put Option ”).

	Put Triggers:	Party B (or FSA directly as third party beneficiary as provided in “Secured Party Exercise”) will have the right to cause exercise of the Put Option upon occurrence of any of the following events (each a “ Put Trigger ”) on any date during the Term of this Transaction:

			(a) if an Asset Default has occurred with respect to any Put Portfolio Asset (an “ Asset Default Trigger ”);

			(b) if, prior to the Liquidity and Collateral Trigger Expiration Date, a Liquidity Default has occurred and is continuing: provided, that in respect of the Liquidity and Collateral Trigger Expiration Date if the occurrence of a Liquidity Default would otherwise be subject to the expiration of a grace period, such grace period shall be deemed to have expired on the Business Day immediately preceding the Liquidity and Collateral Trigger Expiration Date (a “ Liquidity Default Trigger ”);

			(c) if, prior to the Liquidity and Collateral Trigger Expiration Date, a Collateral Posting

		Default has occurred and is continuing: provided, that in respect of the Liquidity and Collateral Trigger Expiration Date if the occurrence of a Collateral Posting Default would otherwise be subject to the expiration of a grace period, such grace period shall be deemed to have expired on the Business Day immediately preceding the Liquidity and Collateral Trigger Expiration Date (a “ Collateral Default Trigger ”); or

		(d) if a Dexia Bankruptcy has occurred and is continuing (a “ Bankruptcy Trigger ”);

	(the date of any exercise of the Put Option a “ Put Exercise Date ”). The Put Option may be exercised separately from time to time in relation to one or more separately occurring Put Triggers.

Put Exercise Amounts:	The Put Option may be exercised by Party B (or by FSA directly as third party beneficiary as provided in “Secured Party Exercise”):

		(a) if the Put Option is exercised in relation to any Asset Default Trigger, with respect to the Outstanding Principal Amount of the Defaulted Asset;

		(b) if the Put Option is exercised in relation to any Liquidity Default Trigger, with respect to an aggregate Outstanding Principal Amount of Put Portfolio Assets selected by the Collateral Agent or by FSA directly as third party beneficiary as provided in “Secured Party Exercise”, equal to the lesser of (1) the relevant Defaulted Liquidity Amount or (2) the GIC Balance (less any Committed Settlement Amount), provided that in making such selection the Collateral Agent or FSA as third party beneficiary, as applicable, shall comply with the Maximum Asset Value Restriction;

		(c) if the Put Option is exercised in relation to any Collateral Default Trigger, with respect to an aggregate Outstanding Principal Amount of Put Portfolio Assets selected by the Collateral Agent or by FSA directly as third party beneficiary as provided in “Secured Party Exercise”, equal to the lesser of (1) (x) the relevant Defaulted Collateral Amount plus (y) the net Delivery Amount that would arise under the Credit Support Annex as a result of Delivery of the Put Settlement Assets on the Put Settlement

		Date and (2) the GIC Balance (less any Committed Settlement Amount), provided that in making such selection the Collateral Agent or FSA as third party beneficiary, as applicable, shall comply with the Maximum Asset Value Restriction; and

		(d) if the Put Option is exercised in relation to a Bankruptcy Trigger, with respect to an Outstanding Principal Amount of Put Portfolio Assets selected by the Collateral Agent or FSA directly as third party beneficiary as provided in “Secured Party Exercise”, equal to the lesser of (1) 100% of the aggregate Outstanding Principal Amount of all the Put Portfolio Assets or (2) the GIC Balance (less any Committed Settlement Amount).

	(the relevant Outstanding Principal Amount of Put Portfolio Assets with respect to which the Put Option has been exercised as described above on any date, subject to “Affected Collateral Delivery” below, the “ Put Settlement Assets ”).

	“ Maximum Asset Value Restriction ” means that the Collateral Agent or by FSA directly as third party beneficiary as provided in “Secured Party Exercise” shall select assets (which may or may not be Defaulted Assets) for which the weighted average of the most recently determined FSAM Asset Value is not more than 5% higher than the weighted average FSAM Asset Value of all remaining Put Portfolio Assets as a whole (provided that if it would not be possible to deliver Put Portfolio Assets of such maximum average value due to minimum denomination restrictions, the Collateral Agent, or FSA directly as third party beneficiary as provided in “Secured Party Exercise,” shall only be required to select assets that comply with such limitation to the extent reasonably practicable).

	“ Committed Settlement Amount ” means, in relation to any Collateral Default Trigger, Liquidity Default Trigger or Bankruptcy Trigger, the Outstanding Principal Amount of all Put Portfolio Assets which have been identified for purposes of a different Collateral Default Trigger, Liquidity Default Trigger or Bankruptcy Trigger for which the relevant Put Settlement Date has not yet occurred.

Exercise Notice:	In relation to any exercise of the Put Option, Party B (or FSA directly as third party beneficiary as provided in “Secured Party Exercise”) will be required to provide to Party A and FSA at the notice addresses

		specified below, an exercise notice in the form of Annex 2 (the “ Exercise Notice ”) (which shall be delivered by email or facsimile, return receipt requested) which shall also include (i) in the case of an exercise of the Put Option in relation to an Asset Default Trigger, a servicer or trustee report, advice from a paying agent, record of a clearance system, statement by a rating agency, or similar information documenting the relevant Interest Shortfall Amount, Principal Shortfall Amount or Writedown Amount (any a “ Shortfall Amount ”), (ii) in the case of an exercise of the Put Option in relation to an Liquidity Default Trigger, a calculation of the relevant Defaulted Liquidity Amount including evidence of the relevant notice or request for payment and confirmation by the Collateral Agent of nonreceipt of funds, and of the GIC Balance (iii) in the case of an exercise of the Put Option in relation to a Collateral Default Trigger, a calculation of the relevant Defaulted Collateral Amount including evidence of the relevant demand for Transfer of a Delivery Amount and confirmation by the Collateral Agent of nonreceipt of such Delivery Amount, and of the GIC Balance or (iv) in the case of an exercise of the Put Option in relation to a Bankruptcy Trigger, a calculation of the aggregate current Outstanding Principal Amount plus accrued interest of the Put Portfolio Assets and of the GIC Balance (each of (i), (ii), (iii) or (iv) in relation to any exercise of the Put Option the “ Shortfall Information ”).

		Simultaneously with the delivery of the Put Exercise Notice to Party A and FSA, Party B or the Collateral Agent (including FSA acting on behalf of the Collateral Agent) will deliver a copy of such Put Exercise Notice to the Sovereign Guarantors, together with the relevant Shortfall Information.

	Secured Party Exercise:	Party A acknowledges and agrees that, without limitation of the rights of Party B hereunder:

		(a) an Exercise Notice may be delivered by the Collateral Agent or by FSA directly as third party beneficiary under this Agreement (i) in relation to any Asset Default Trigger following a failure of Party B to deliver an Exercise Notice within five Business Days after the occurrence of the relevant Asset Default or (ii) in relation to any Liquidity Default Trigger, any Collateral Default Trigger or any Bankruptcy Trigger;

		(b) the Collateral Agent or FSA directly as third party beneficiary under this Agreement may specify the related Put Exercise Amounts and select Put Portfolio Assets in relation to any Liquidity Default

		Trigger, any Collateral Default Trigger or any Bankruptcy Trigger and deliver any Shortfall Information (whether or not it delivered the related Exercise Notice); and

		(c) FSA directly as third party beneficiary under this Agreement may make demands and request and dispute valuations as set forth in the Credit Support Annex.

	Defaulted Asset:	A Put Portfolio Asset in relation to which an Asset Default has occurred.

	Asset Default:	The occurrence of a Failure to Pay Principal, Interest Shortfall or Writedown.

	Liquidity Default:	A payment default by Dexia or any of its Affiliates under any Guaranteed Liquidity Facility, including without limitation a failure to pay an Accelerated Downgrade Liquidity Draw by the Accelerated Downgrade Liquidity Draw Deadline on the relevant date (a “ Deemed Downgrade Liquidity Default ”). The amount of any and all such failures to pay ( i.e. , the unpaid amount) on any date (net of any partial payments by Dexia or its Affiliates) is the “ Defaulted Liquidity Amount ”.

		To the extent that the occurrence of a default under any Guaranteed Liquidity Facility is subject to the expiration of a grace period for payment, such grace period shall be deemed to have expired on the earlier of (i) its stated expiration date or (ii) the Business Day immediately preceding the Liquidity and Collateral Trigger Expiration Date.

		“ Guaranteed Liquidity Facilities ” means each of (i) the Liquidity Facility and the Repurchase Agreement Facility, in accordance with their terms as of the Effective Date (the “ Existing Facilities ”) and (ii) any additional liquidity facilities between Party B and either DCL or Dexia Bank Belgium SA (including any successors thereto by reason of Corporate Reorganization or any Affiliates thereof to whom their obligations are transferred in accordance with the terms of such Existing Facilities) entered into from time to time after the Effective Date, that are in substantially the same form as the Existing Facilities and are entered into for the purpose of providing liquidity to meet Party B’s payment obligations (including obligations to meet collateral posting requirements under the GICs) under the Master Repurchase Agreement to the GIC Issuers to service the GICs, if the aggregate maximum commitment amount of such facilities, when added to the maximum commitment amount of the Existing

		Facilities, does not exceed the GIC Balance on the date any such additional facilities are entered into.

	Collateral Posting Default:	A failure to Transfer Eligible Collateral having a Value equal to a required Delivery Amount on any date on or after the First Collateral Posting Date, in each case within the time required under Paragraph 4(b) of the Credit Support Annex. The amount of any such failure to Transfer on any date (net of any partial amounts Transferred by Dexia or its Affiliates) is the “ Defaulted Collateral Amount ”.

		For the avoidance of doubt, the Defaulted Collateral Amount applicable in relation to any Collateral Posting Default hereunder shall not be offset or decreased by any Defaulted Collateral Amount applicable under the Dexia Non-Guaranteed Put Contract.

		With respect to any date which falls during a period which is (A) not on or after a Sovereign Guarantee Unenforceability Date and (B) (I) on and after the First Collateral Posting Date and prior to the Liquidity and Collateral Trigger Expiration Date or (II) during a period that a DCL Bankruptcy has occurred and is continuing (a “ No DCL Collateral Period ”), (i) any Eligible Collateral Transferred by DCL, whether at any time before or during such No DCL Collateral Period, will be deemed to have a Value of zero during such No DCL Collateral Period (any such Eligible Collateral on any date during the No DCL Collateral Period the “ Affected DCL Collateral ”) and (ii) only postings made by Dexia (whether made at any time before or during such No DCL Collateral Period, and including by substitution in accordance with the Credit Support Annex of Eligible Collateral posted by Dexia for Eligible Collateral posted by DCL) will be considered in calculating any applicable Delivery Amount and whether the obligation to Transfer Eligible Collateral with a Value equal to such Delivery Amount has been met during such No DCL Collateral Period; provided, that such Affected DCL Collateral shall be Transferred to DCL against the simultaneous delivery of replacement Eligible Collateral by Dexia.

		With respect to any date which falls during a period which is (A) on or after a Sovereign Guarantee Unenforceability Date and (B) not during a period that a DCL Bankruptcy has occurred and is continuing (a “ No Dexia Collateral Period ”), (i) any Eligible Collateral Transferred by Dexia, whether at any time before or during such No Dexia Collateral Period, will be deemed to have a Value of zero during such No Dexia Collateral Period (any such Eligible Collateral

		on any date during the No Dexia Collateral Period the “ Affected Dexia Collateral ”) and (ii) only postings made by DCL (whether made at any time before or during such No Dexia Collateral Period, and including by substitution in accordance with the Credit Support Annex of Eligible Collateral posted by DCL for Eligible Collateral posted by Dexia) will be considered in calculating any applicable Delivery Amount and whether the obligation to Transfer Eligible Collateral with a Value equal to such Delivery Amount has been met during such No Dexia Collateral Period; provided, that such Affected Dexia Collateral shall be Transferred to Dexia against the simultaneous delivery of replacement Eligible Collateral by DCL.

	Affected Collateral Delivery:	In relation to any Put Settlement Date arising from a Collateral Default Trigger occurring during a No DCL Collateral Period or No Dexia Collateral Period, the Put Settlement Assets shall include, in addition to the Put Settlement Assets selected by the Collateral Agent or FSA as third party beneficiary, as applicable, under (c) of “Put Exercise Amount” above, the relevant Affected DCL Collateral or Affected Dexia Collateral as of the date of occurrence of the relevant Collateral Default Trigger.

	Dexia Bankruptcy:	As defined in the Schedule. The exercise of the Put Option following a Bankruptcy Trigger is not to be construed as the designation of an Early Termination Date, nor does exercise of the Put Option following a Bankruptcy Trigger prejudice to the right of Party B to designate an Early Termination Date subsequent to the Put Settlement Date for such Bankruptcy Trigger in the event that any Event of Default has occurred or is continuing after such Put Settlement Date.

	Liquidity and Collateral Trigger Expiration Date:	31 October 2011.

	First Collateral Posting Date:	29 September 2011.

	Put Settlement:	On (x) the second Business Day after the relevant Put Exercise Date or (y) in the case of an Accelerated Downgrade Liquidity Default Exercise, on the first Business Day after the Put Exercise Date (as applicable, the “ Put Settlement Date ”) and subject to “Deferred Settlement Election” below, Party B or the Collateral Agent on behalf of Party B will Deliver to DCL or Dexia, as applicable, the relevant Put Settlement Assets, against payment of the Put Settlement Amount to Party B by Party A (such payment to occur by the time specified in the last paragraph under “Put Settlement Amount”). In the event that the Defaulted Liquidity Amount on the Put

		Exercise Date includes both amounts arising from an Accelerated Downgrade Liquidity Draw and other unpaid amounts under one or more Guaranteed Liquidity Facilities, separate Put Settlement Dates shall occur in relation to each relevant portion of the Put Exercise Amount.

		“ Accelerated Downgrade Liquidity Default Exercise ” means an exercise of the Put Option as a result of a Liquidity Default Trigger which occurs due to a Deemed Downgrade Liquidity Default.

		Delivery of Put Settlement Assets will be effected through an escrow, custody or similar arrangement with the Collateral Agent, such that the Put Settlement Assets will be Delivered by the Collateral Agent and the Put Settlement Amount will be paid to Party B, but the Put Settlement Assets will be Delivered (i) to Dexia if the Put Settlement Amount is paid to Party B by Dexia, (ii) to DCL if the Put Settlement Amount is paid to Party B by DCL or (iii) to Dexia if the Put Settlement Amount is paid to Party B by the Sovereign Guarantors.

		“ Deliver ” means to deliver, novate, transfer, assign or sell, as appropriate, in the manner customary for the settlement of the applicable Put Settlement Assets (which shall include executing all necessary documentation and taking any other necessary actions), in order to convey all right, title and interest in the Put Settlement Assets to Dexia or DCL, as applicable, free and clear of any and all liens, charges, claims or encumbrances; provided that, Dexia and DCL each hereby waive any right to object to the Delivery of a Put Settlement Asset (i) as failing to be free and clear of liens, charges, claims or encumbrances or (ii) for breach of any implied or express representation or warranty hereunder, except in the case of a lien, charge, claim or encumbrance that is predominantly attributable to actions of FSA taken after the Effective Date.

		Without limitation of the foregoing, in relation to Put Settlement Assets which may be subject to a pledge or lien, Party A agrees that the settlement of the payment of the Put Settlement Amount by Party A and Delivery of the Put Settlement Assets by Party B may be effected by means of an undertaking by the Collateral Agent, acting as an escrow agent, custodian or in a similar capacity, to deliver such Put Settlement Assets to Party A following receipt of a payment hereunder (whether by treating such payment as a discharge of the relevant pledge or lien, as a substitution of cash collateral in place of such Put Settlement Assets for purposes of the relevant pledge

		agreement, or otherwise).

	Delayed Delivery Following DCL Belgian Corporate Reorganization:	In the event that a Put Settlement Date occurs (i) on or after a DCL Belgian Corporate Reorganization has occurred and (ii) on a date on which the relevant Put Settlement Amount would constitute a Pre-Collateral Posting Payment, and except in the case of a Put Settlement under which the Put Settlement Amount is paid to Party B by the Sovereign Guarantors, (A) Party A will be required to pay the Put Settlement Amount on the Put Settlement Date, (B) Party B will not be required to Deliver the related Put Settlement Assets until the date following the Put Settlement Date on which the Belgian Preference Period has expired and (C) pending such Delivery on the date referred to in (B), Party A will be deemed to have pledged the relevant Put Settlement Assets to Party B and Party B shall hold such Put Settlement Assets as additional Posted Collateral under the Credit Support Annex and treated as Repledged Assets thereunder.

		“ DCL Belgian Corporate Reorganization ” means any occurrence of a Corporate Reorganization (as defined in the Schedule) with respect to DCL such that Belgium is the jurisdiction of organization of DCL following such Corporate Reorganization.

		“ Belgian Preference Period ” means 6 months, or if the period of time specified in Article 12 of the Belgian Bankruptcy Act of 8 August 1997 is amended, such amended period of time.

	DCL Delivery:	DCL agrees that any Put Settlement Assets delivered to DCL hereunder which may be required to be delivered outside the United States or to non-United States persons, or with respect to which for any other reason delivery of such Put Settlement Asset in New York is impracticable, may at Party B’s election be delivered to a registered office of Dexia Crédit Local S.A. outside of the United States.

	Put Settlement Amount:	An amount equal to 100% of the Outstanding Principal Amount of the Put Settlement Assets Delivered on the Put Settlement Date (other than any Affected DCL Collateral or Affected Dexia Collateral), plus (without duplication) (i) any Interest Shortfall Amount, Principal Shortfall Amount or Writedown Amount accrued but not yet paid hereunder as of the Put Settlement Date and (ii) accrued and unpaid interest (except to the extent already paid to Party B pursuant to a Deferred Settlement Election or under (i)) through the Put Settlement Date (in each case converted if applicable to USD at the Specified Currency Rate).

	The Put Settlement Asset Delivered on each Put Settlement Date will include the right to receive all accrued and unpaid interest in respect of the Outstanding Principal Amount of the Put Settlement Assets Delivered.

	The obligation to pay any Put Settlement Amount pursuant to an Exercise Notice delivered prior to the occurrence of the Scheduled Termination Date shall survive the occurrence of the Scheduled Termination Date.

	In the case of an Accelerated Downgrade Liquidity Default Exercise, Party A will pay the Put Settlement Amount to Party B not later than 9:00 am New York City time on the Put Settlement Date. In all other cases, Party A will pay the Put Settlement Amount to Party B not later than 4:00 pm Central European Time on the Put Settlement Date.

Cure of Defaulted Liquidity Amount or Defaulted Collateral Amount:	Notwithstanding exercise of the Put Option in relation to a Liquidity Default Trigger or Collateral Default Trigger, if the related Defaulted Liquidity Amount or Defaulted Collateral Amount has been cured in full on or prior to the relevant Put Settlement Date, the Put Settlement Date shall not occur and the Exercise Notice in relation thereto shall be deemed withdrawn.

Deferred Settlement Right:	In relation to any Put Exercise Date arising from an Asset Default Trigger, Party A may give a notice to Party B (with a copy to FSA), on or before the Put Settlement Date, electing to defer the Put Settlement Date (a “ Deferred Settlement Election ”) for any period of time prior to the earliest of (i) the Final Amortization Date of the Defaulted Asset, (ii) the Legal Final Maturity Date of the Defaulted Asset and (iii) the 30 th day prior to the Sovereign Asset Guarantee Expiration Date, provided that during such period Party A shall periodically pay to Party B any Shortfall Amounts with respect to such Defaulted Asset on or before:

		(I) in the case of the Put Portfolio Asset Payment Date occurring on or immediately preceding the Asset Default Trigger, the third Business Day following the Put Exercise Date, and

		(II) in the case of each Put Portfolio Asset Payment Date occurring after the Put Portfolio Asset Payment Date in (I), (A) if a Dexia Event of Default has occurred and FSA is acting as the Secured Party Representative, the third Business Day after the later of (i) the date such amounts are determined under the provisions of the Underlying Instruments and holders of the

		Defaulted Asset have been notified of such determination or (ii) the date of receipt of the relevant Shortfall Information by Party A or (B) otherwise, the third Business Day after the earlier of (i) the date such amounts are determined under the provisions of the Underlying Instruments and holders of the Defaulted Asset have been notified of such determination or (ii) the date of receipt of the relevant Shortfall Information by Party A (each a “ Shortfall Payment Date ”).

	On any date after Dexia, DCL or the Sovereign Guarantors have made a payment of Shortfall Amounts pursuant to a Deferred Settlement Election, such Deferred Settlement Election shall continue in effect and need not be renewed or repeated in relation to subsequent Asset Default Triggers for the same Put Portfolio Asset, provided that (a) Party A or the Sovereign Guarantors, as applicable, may cause the Put Settlement Date to occur with respect to the related Defaulted Asset upon two Business Days’ prior notice to Party B, the Collateral Agent and FSA, and (b) the Put Settlement Date shall occur immediately with respect to the related Defaulted Asset if (i) Dexia does not pay a Shortfall Amount (and DCL also does not pay such amount), (ii) the Sovereign Guarantors fail to pay such Shortfall Amount under the Sovereign Guarantee within the time permitted thereby (a “ Sovereign Nonpayment ”) and (iii) neither Dexia nor the Sovereign Guarantors cures such failure within 10 Business Days after receipt of a notice from Party B, on or after the date of Sovereign Nonpayment, requiring that the Put Settlement Date be accelerated.

	For the avoidance of doubt, no Deferred Settlement Election may be made with respect to any Defaulted Assets selected in connection with any Put Option related to a Liquidity Default Trigger, a Collateral Default Trigger or a Bankruptcy Trigger.

	The obligation to pay any Shortfall Amounts and Put Settlement Amount pursuant to a Deferred Settlement Election exercised prior to the occurrence of the Scheduled Termination Date shall survive the occurrence of the Scheduled Termination Date.

Offset of Collateral:	On any Put Settlement Date on or after a date on which a Dexia Event of Default has occurred where (x) the Subordinated Claims Payment Condition is not met, (y) Party B and the Collateral Agent are entitled to exercise the remedies under Paragraph 8 of the Credit Support Annex and (z) Party A would be entitled to receive a Return Amount under the Credit Support Annex, based on the current calculation of

		Exposure and the Value of Posted Credit Support held by Party B, but for the fact that the Subordinated Claims Payment Condition is not met (the Return Amount to which Party A would be so entitled a “ Deemed Return Amount ), (i) the Put Settlement Amount in relation to any Liquidity Default Trigger or Collateral Default Trigger shall be reduced by such Deemed Return Amount or (ii) without duplication of (i), the Shortfall Amount in relation to any Asset Default Trigger shall be reduced by such Deemed Return Amount (but in no event to less than zero).

	Claims under the Sovereign Guarantee:	If a Put Settlement Date arises from an Asset Default Trigger, irrespective of whether Party A (i) has not made a Deferred Settlement Election, (ii) has made a Deferred Settlement Election, or (iii) has given notice causing the Put Settlement Date to occur, in the event that (A) Party A does not pay the relevant Shortfall Amounts on any date thereafter, (B) Party A does not pay the Put Settlement Amount on the Put Settlement Date and (C) Party B or the Collateral Agent, or FSA directly as third party beneficiary gives notice of such nonpayment to the Sovereign Guarantors, together with the relevant Shortfall Information, then at the option of the Sovereign Guarantors either (i) a Deferred Settlement Election shall be deemed to have been made and continued in effect, such that the Sovereign Guarantors shall, until the earlier of (x) the Final Amortization Date or (y) the Legal Final Maturity Date of the Defaulted Asset, pay only the relevant Shortfall Amounts under the Sovereign Guarantee (and not Put Settlement Amounts) or (ii) the Sovereign Guarantors shall pay the portion of the Put Settlement Amount not paid by Party A against the delivery of the Put Settlement Assets to Dexia, in each case within the time period for payment required under the Sovereign Guarantee. Unless both Sovereign Guarantors shall opt for the application of sub-clause (ii) above, sub-clause (i) shall be deemed to apply; provided that no Deferred Settlement Election may be made or deemed made under sub-clause (i) if the related Put Settlement Date arose following a prior Deferred Settlement Election made or deemed made by the Sovereign Guarantors in relation to the related Defaulted Asset.

	Currency Conversion:	In relation to any Put Settlement Asset not denominated in USD, the Put Settlement Amount and any Shortfall Amount shall still be denominated in USD, such amount to be determined by conversion of the Outstanding Principal Amount plus accrued interest, or Shortfall Amount, as applicable, at the Specified Currency Rate.

4.	Call Right

	Call Option:	Party B hereby grants to Party A, a call option in relation to each Put Portfolio Asset exercisable in accordance with the terms hereof on any Business Day (the “ Call Option ”). The Call Option may be exercised (i) by Party A only if there shall not have occurred any Dexia Event of Default and if such exercise would not cause Party B to violate § 6.5.1 or § 6.5.2. of the Sovereign Guarantee Reimbursement Agreement and (ii) prior to the Liquidity and Collateral Expiration Date, only by DCL. In any event, no purported exercise of the Call Option shall be valid unless Party A shall deliver to Party B information from the Valuation Agent demonstrating that Party A has Transferred Eligible Collateral to the Custodian in an amount sufficient that no Delivery Amount would result or be outstanding after the exercise and settlement of the Call Option.

	Exercise Notice:	In relation to any exercise of the Call Option, Party A will be required to provide to Party B, an exercise notice in the form of Annex 3 (the “ Call Not ice ”). The Call Notice shall specify the Put Portfolio Assets proposed to be purchased by Party A (the “ Call Settlement Assets ”) . Delivery of a Call Notice is irrevocable and shall constitute an indefeasible agreement to purchase the related Call Settlement Assets.

	Call Settlement:	Settlement of the Call Option shall occur on the second Business Day after the delivery to Party B of the Call Notice (such date, the “ Call Settlement Date ”). On the Call Settlement Date, the Collateral Agent will Deliver to DCL or Dexia, as applicable, the relevant Call Settlement Assets against payment of the Call Settlement Amount to Party B by Party A. If Party A fails to pay the Call Settlement Amount, the Call Option will fail and the related Call Settlement Assets will not be delivered to Party A.

	Call Settlement Amount:	At the election of Party A, in respect of the Call Settlement Asset, an amount equal to (A) either (x) 100% of the Outstanding Principal Amount or (y) the Mark to Market Value of the Call Settlement Assets Delivered on the Call Settlement Date (provided that if a DCL Belgian Corporate Reorganization has occurred, clause (x) shall not apply), plus (B) (i) any Interest Shortfall Amount, Principal Shortfall Amount or Writedown Amount accrued but not yet paid hereunder as of the Call Settlement Date plus, without duplication (ii) accrued and unpaid interest through the Call Settlement Date (in each case converted if applicable to USD at the Specified Currency Rate).

		The Call Settlement Asset Delivered on each Call Settlement Date will include the right to receive all accrued and unpaid interest in respect of the Outstanding Principal Amount of the Call Settlement Assets Delivered.

	Currency Conversion:	In relation to any Call Settlement Asset not denominated in USD, the Call Settlement Amount shall still be denominated in USD, such amount to be determined by conversion of the Outstanding Principal Amount or Value, as the case may be, plus accrued interest at the Specified Currency Rate.

	Multiple Exercise :	For the avoidance of doubt, the parties agree that with respect to this Call Option Transaction and notwithstanding anything to the contrary in the 2000 Definitions, multiple Call Settlement Dates may occur and multiple Call Settlement Amounts may be payable by Party A.

5. Additional Provisions :

	Representation as to Exposure:	Party B represents to Party A in relation to the Put Portfolio Assets that on the Effective Date Party B either (i) beneficially owns the relevant Put Portfolio Asset or (ii) is obligated to purchase such Put Portfolio Asset under a repurchase agreement through which the purchase of the Put Portfolio Asset by Party B has been financed (or refinanced), with the result that (x) such Put Portfolio Asset is included in Party B’s balance sheet assets and (y) any income deriving from the Put Portfolio Asset accrues to Party B.

	Obligations of Party A Unconditional:	In relation to its payment obligations under this Put Option Transaction each of Dexia and DCL waives all rights (whether by counterclaim, setoff or otherwise) and defenses (including, without limitation, the defense of fraud), to the extent that such rights and defenses may be available to Party A to avoid payment of their respective obligations under this Put Option Transaction in accordance with its terms (but subject to Party A’s right to receive Delivery of the Put Settlement Assets on any Put Settlement Date and the Call Settlement Assets on any Call Settlement Date) .

	Subrogation Rights:	Subject to and conditioned upon payment by DCL or Dexia ( or, in the case of Dexia, payment by the Sovereign Guarantors under the Sovereign Guarantee) , as applicable, in connection with a Deferred Settlement Election, DCL or Dexia, as applicable, shall be subrogated to the rights of Party B to receive reimbursement from the Issuer of the relevant Put Settlement Asset for the relevant Interest Shortfall, Principal Shortfall or Writedown Amount and to

		exercise any right, power or the like of Party B with respect thereto, provided that DCL or Dexia (as the case may be) may not exercise such subrogation rights unless at such time the Subordinated Claims Payment Condition is satisfied.

	Effect of Payment by Sovereign Guarantors :	Notwithstanding a failure by Party A to make one or more payments under this Agreement (including without limitation any Delivery of Eligible Collateral), and as specified in the Schedule, no Event of Default shall be deemed to have occurred in relation to Dexia or DCL hereunder if the Sovereign Guarantee is still applicable to the relevant payment obligation or to a Dexia Bankruptcy (and no Sovereign Guarantee Unenforceability Date has occurred) and the Sovereign Guarantors perform their payment obligations in relation thereto in a timely manner pursuant to the terms of the Sovereign Guarantee.
	Multiple Exercise :	For the avoidance of doubt, the parties agree that with respect to this Put Option Transaction and notwithstanding anything to the contrary in the 2000 Definitions, multiple Put Settlement Dates may occur and multiple Put Settlement Amounts may be payable by Party A.

	Calculation Agent Determinations:	The Calculation Agent shall be responsible for determining and calculating (i) the Put Premium Amount payable on each Put Premium Payment Date; and (ii) the determination of Shortfall Amounts and providing the Shortfall Information; provided that notwithstanding the above, each of FSA, the Collateral Agent, Party B and Party A shall be entitled to determine and calculate the above amounts to the extent that FSA, the Collateral Agent, Party B or Party A, as applicable, have the right to deliver a notice to the other party demanding payment of such amount. The Calculation Agent, FSA, the Collateral Agent, Party B or Party A, as applicable, shall make such determinations and calculations based solely on the basis of the Servicer Reports, to the extent such Servicer Reports are reasonably available to the Calculation Agent, FSA, the Collateral Agent, Party B or Party A, as applicable. The Calculation Agent, FSA, the Collateral Agent, Party B or Party A, as applicable, shall, as soon as practicable after making any of the determinations or calculations specified in (i) and (ii) above, notify FSA and the parties or the other party, as applicable, of such determinations and calculations. For the avoidance of doubt, if an Interest Shortfall Amount is not explicitly set out in the Servicer Report but the Calculation Agent determines that an Interest Shortfall has occurred on the basis of information in such Servicer Report, then the relevant Interest Shortfall Amount shall be calculated and reported by the

		Calculation Agent on the basis of such information.

	Adjustment of Calculation Agent Determinations	To the extent that a Servicer furnishes any Servicer Reports correcting information contained in previously issued Servicer Reports, and such corrections impact calculations pursuant to this Put Option Transaction, the calculations relevant to this Put Option Transaction shall be adjusted retroactively by the Calculation Agent to reflect the corrected information (provided that, for the avoidance of doubt, no amounts in respect of interest shall be payable by either party and provided that the Calculation Agent in performing the calculations pursuant to this paragraph will assume that no interest has accrued on any adjusted amount), and the Calculation Agent shall promptly notify both parties and FSA of any corrected payments required by either party. Any required corrected payments shall be made within five Business Days of the day on which such notification by the Calculation Agent is effective.

6. Notices and Account Details:

	Notices to Party B:	As set forth in the Schedule

	Notices to Party A:	As set forth in the Schedule

	Account Details of Party B:	The FSAM Cash Account (as defined in the Pledge and Administration Agreement)

	Account Details of Party A:	To be advised in writing by Party A

7. Additional Definitions :

For the purposes of this Put Option Transaction only, the following terms have the meanings given below:

“ Accelerated Downgrade Liquidity Draw ” has the meaning specified in the relevant Guaranteed Liquidity Facility.

“ Accelerated Downgrade Liquidity Draw Deadline ” means 9:00 am, New York City time on the first Business Day after the date on which the relevant Accelerated Downgrade Liquidity Draw is deemed requested (under the terms of the relevant Guaranteed Liquidity Facility).

“ Actual Interest Amount ” means, with respect to any Put Portfolio Asset Payment Date, payment by or on behalf of the Issuer of an amount in respect of interest due under the Put Portfolio Asset (including, without limitation, any deferred interest or default interest but excluding payments in respect of prepayment penalties, yield maintenance provisions or principal, except that the Actual Interest Amount shall include any payment of principal representing capitalized interest) to the holder(s) of the Put Portfolio Asset in respect of the Put Portfolio Asset.

“ Actual Principal Amount ” means, with respect to the Final Amortization Date, Principal Installment Date or the Legal Final Maturity Date, an amount paid on such day by or on behalf of the Issuer in respect of principal (excluding any amount representing capitalized interest) to the holder(s) of the Put Portfolio Asset in respect of the Put Portfolio Asset.

“ Applicable Percentage ” means in relation to any Put Portfolio Asset the percentage indicated as such in the Put Portfolio Annex.

“ Collateral Agent ” has the meaning specified in the Pledge and Administration Agreement.

“ DCL Bankruptcy ” means the occurrence with respect to DCL of an event described in Section 5(a)(vii), provided, however, that subclause (4) of Section 5(a)(vii) shall be amended so that the reference to “30 days” in subclause (4)(B) of Section 5(a)(vii) shall refer to “60 days”.

“ Effective Maturity Date ” in relation to any Put Portfolio Asset means the earlier of the Legal Final Maturity Date or Final Amortization Date, each as subject to adjustment in accordance with the Following Business Day Convention, in relation to such Put Portfolio Asset.

“ Expected Interest Amount ” means, with respect to any Put Portfolio Asset Payment Date, the amount of current interest that would accrue during the related Put Portfolio Asset Calculation Period calculated using the Put Portfolio Asset Coupon on a principal balance of the Put Portfolio Asset equal to (measured as of the first day of the related Put Portfolio Asset Calculation Period) the Outstanding Principal Amount taking into account any reductions due to a principal deficiency balance or realized loss amount (however described in the Underlying Instruments) that are attributable to the Put Portfolio Asset, and that will be payable on the related Put Portfolio Asset Payment Date assuming for this purpose that sufficient funds are available therefor in accordance with the Underlying Instruments.

Except as provided in the previous sentence, the Expected Interest Amount shall be determined without regard to (i) unpaid amounts in respect of accrued interest on prior Put Portfolio Asset Payment Dates; (ii) any prepayment penalties or yield maintenance provisions; or (iii) the effect of any provisions (however described) of such Underlying Instruments that otherwise permit the limitation of due payments to distributions of funds available from proceeds of the Underlying Assets, or that provide for the capitalization or deferral of interest on the Put Portfolio Asset, or that provide for the extinguishing or reduction of such payments or distributions or (iv) any “available funds cap” or “net WAC cap” or similar provision of the Underlying Instruments (each a “ Limitation Provision ”) (but, for the avoidance of doubt, taking account of any Writedown within the definition of “Writedown” occurring in accordance with the Underlying Instruments).

For the purposes of calculating the Expected Interest Amount, and notwithstanding any other provision herein, the Put Portfolio Asset Coupon shall be deemed to include any cap stated in the Underlying Instrument that is not a Limitation Provision (but any “available funds cap” or “net WAC cap” or similar provision of the Underlying Instruments shall be deemed to constitute a Limitation Provision and not a cap as described in this sentence).

“ Expected Principal Amount ” means (A) with respect to the Final Amortization Date or the Legal Final Maturity Date, an amount equal to (i) the Outstanding Principal Amount of the Put Portfolio Asset payable on such day (excluding any amount representing capitalized interest) assuming for this purpose that sufficient funds are available for such payment, where such amount shall be determined in accordance with the Underlying Instruments, minus (ii) the net aggregate principal deficiency balance or realized loss amounts (however described in the Underlying Instruments) that are attributable to the Put Portfolio Asset and (B) with respect to any Principal Installment Date, the Principal Installment Amount for such Principal Installment Date. The Expected Principal Amount shall be determined without regard to the effect of any provisions (however described) of the Underlying Instruments that permit the limitation of due payments or distributions of funds in accordance with the terms of such Put Portfolio Asset or that provide for the extinguishing or

reduction of such payments or distributions.

“ Failure to Pay Principal ” means (i) a failure by the Issuer (and any applicable Insurer) to pay an Expected Principal Amount on the Final Amortization Date, the Legal Final Maturity Date or a Principal Installment Date, as the case may be, or (ii) payment on any such day of an Actual Principal Amount that is less than the Expected Principal Amount; provided that the failure by the Issuer (and any applicable Insurer) to pay any such amount in respect of principal in accordance with the foregoing shall not constitute a Failure to Pay Principal if such failure has been remedied within any grace period applicable to such payment obligation under the Underlying Instruments or, if no such grace period is applicable, within five Business Days after the day on which the Expected Principal Amount was scheduled to be paid.

“ Final Amortization Date ” means the first to occur of (i) the date on which the Put Portfolio Asset Principal Amount is reduced to zero and (ii) the date on which the Underlying Assets owned or held by the Issuer are liquidated, distributed or otherwise disposed of in full and the proceeds thereof are distributed or otherwise disposed of in full.

“ GICs ” means the guaranteed investment contracts (including guaranteed investment contracts in the form of repurchase agreements) entered into by the GIC Issuers on or prior to the Effective Date and listed on Annex 4 hereto.

“ GIC Balance ” means on any date of determination the aggregate outstanding principal balance of the GICs as most recently reported under the Pledge and Administration Agreement on such date.

“ GIC Issuers ” means FSA Capital Markets Services (Caymans) Limited, FSA Capital Management Services LLC and FSA Capital Markets Services LLC.

“ Initial Face Amount ” means in relation to any Put Portfolio Asset the amount indicated as such in the Put Portfolio Annex.

“ Initial Factor ” means in relation to any Put Portfolio Asset the factor indicated as such in the Put Portfolio Annex.

“ Interest Shortfall ” means, with respect to any Put Portfolio Asset Payment Date, either (a) the non-payment of an Expected Interest Amount or (b) the payment of an Actual Interest Amount that is less than the Expected Interest Amount. For the avoidance of doubt, the occurrence of an event within (a) or (b) shall be determined taking into account any payment made under the Underlying Policy, if applicable.

“ Interest Shortfall Amount ” means with respect to any Put Portfolio Asset Payment Date, an amount equal to the greater of:

(a) zero; and

(b) the amount equal to the product of:

(i) (A) the Expected Interest Amount;

minus

(B) the Actual Interest Amount; and

(ii) the Applicable Percentage.

“ Insurer ” means in relation to any Put Portfolio Asset the entity indicated as such, if any, in the Put Portfolio Annex.

“ Issuer ” means in relation to any Put Portfolio Asset the entity indicated as such in the Put Portfolio

Annex.

“ Legal Final Maturity Date ” means in relation to any Put Portfolio Asset the date set out in the Put Portfolio Annex (subject, for the avoidance of doubt, to any business day convention applicable to the legal final maturity date of the Put Portfolio Asset), provided that if the legal final maturity date of the Put Portfolio Asset is amended, the Legal Final Maturity Date shall be such date as amended.

“ Liquidity Facility ” has the meaning specified in the Pledge and Administration Agreement.

“ Master Repurchase Agreement ” means the Master Repurchase Agreement, dated as of June 30, 2009, among Party B, each GIC Issuer and FSA as third party beneficiary, as the same may be replaced, refinanced, or amended, supplemented or otherwise modified from time to time.

“ Original Principal Amount ” means in relation to any Put Portfolio Asset the amount indicated as such in the Put Portfolio Annex.

“ Outstanding Principal Amount ” means, as of any date of determination with respect to the Put Portfolio Asset, the outstanding principal balance of the Put Portfolio Asset as of such date, which shall take into account:

(i) all payments of principal;

(ii) all writedowns or applied losses (however described in the Underlying Instruments) resulting in a reduction in the outstanding principal balance of the Put Portfolio Asset (other than as a result of a scheduled or unscheduled payment of principal);

(iii) forgiveness of any amount by the holders of the Put Portfolio Asset pursuant to an amendment to the Underlying Instruments resulting in a reduction in the outstanding principal balance of the Put Portfolio Asset;

(iv) any payments reducing the amount of any reductions described in (ii) and (iii) of this definition; and

(v) any increase in the outstanding principal balance of the Put Portfolio Asset that reflects a reversal of any prior reductions described in (ii) and (iii) of this definition; and

(vi) any increase in the outstanding principal balance of the Put Portfolio Asset that is attributable to the deferral or capitalization of interest prior to the Effective Date.

For the avoidance of doubt, the Outstanding Principal Amount shall not include any portion of the outstanding principal balance of the Put Portfolio Asset that is attributable to the deferral or capitalization of interest on or after the Effective Date.

“ Principal Installment Amount ” means, with respect to any Put Portfolio Asset having scheduled installment dates for the repayment of principal, and a Principal Installment Date, the amount of the relevant installment of principal payable on such Principal Installment Date.

“ Principal Installment Date ” means, with respect to any Put Portfolio Asset having scheduled installment dates for the repayment of principal, each such scheduled installment date (other than any Legal Final Maturity Date or Final Amortization Date).

“ Principal Payment ” means, with respect to any Put Portfolio Asset Payment Date, the occurrence of a payment of an amount to the holders of the Put Portfolio Asset in respect of principal (scheduled or unscheduled) in respect of the Put Portfolio Asset other than a payment in respect of principal representing capitalized interest.

“ Principal Payment Amount ” means, with respect to any Put Portfolio Asset Payment Date, an amount equal to the product of (i) the amount of any Principal Payment on such date and (ii) the

Applicable Percentage.

“ Principal Shortfall Amount ” means, in respect of a Failure to Pay Principal, an amount equal to the greater of:

(i) zero; and

(ii) the amount equal to the product of:

(A) the Expected Principal Amount minus the Actual Principal Amount; and

(B) the Applicable Percentage.

If the Principal Shortfall Amount would be greater than the Put Portfolio Asset Principal Amount immediately prior to the occurrence of such Failure to Pay Principal, then the Principal Shortfall Amount shall be deemed to be equal to the Put Portfolio Asset Principal Amount at such time.

“ Put Portfolio Asset Calculation Period ” means, with respect to each Put Portfolio Asset Payment Date, a period corresponding to the interest accrual period relating to such Put Portfolio Asset Payment Date pursuant to the Underlying Instruments.

“ Put Portfolio Asset Coupon ” means the periodic interest rate applied in relation to each Put Portfolio Asset Calculation Period on the related Put Portfolio Asset Payment Date (including any scheduled step-up or similar scheduled adjustment to such interest rate from time to time provided under the terms of the Underlying Instruments), as determined in accordance with the terms of the Underlying Instruments as at the Effective Date, without regard to any subsequent amendment to which Party A and the Sovereign Guarantors have not given their prior written consent (other than an amendment with respect to which the consent of the holder of the Put Portfolio Asset is not required).

“ Put Portfolio Asset Payment Date ” means each scheduled distribution date for the Put Portfolio Asset occurring on or after the Effective Date and on or prior to the Legal Final Maturity Date for such Put Portfolio Asset, determined in accordance with the Underlying Instruments.

“ Put Portfolio Asset Principal Amount ” means the following:

On the Effective Date, the product of:

(a) the Original Principal Amount;

(b) the Initial Factor; and

Following the Effective Date, each Put Portfolio Asset Principal Amount will be:

(i) decreased on each day on which a Principal Payment is made by the relevant Principal Payment Amount;

(ii) decreased on the day, if any, on which a Failure to Pay Principal occurs by the relevant Principal Shortfall Amount; and

(iii) decreased on each day on which a Writedown occurs by the relevant Writedown Amount.

For the avoidance of doubt, the Put Portfolio Asset Principal Amount shall not be increased by any deferral or capitalization of interest or decreased by payment of any portion of the principal balance of the Put Portfolio Asset that is attributable to the deferral or capitalization of interest.

“ Repurchase Agreement Facility ” has the meaning specified in the Pledge and Administration

Agreement.

“ Servicer ” means any trustee, servicer, sub-servicer, master servicer, fiscal agent, paying agent or other similar entity responsible for calculating payment amounts or providing reports pursuant to the Underlying Instruments.

“ Servicer Report ” means a periodic statement or report regarding the Put Portfolio Asset provided by the Servicer to holders of the Put Portfolio Asset.

“ Shortfall Amount ” means any Interest Shortfall Amount, Principal Shortfall Amount or Writedown Amount.

“ Sovereign Asset Guarantee Expiration Date ” means March 30, 2035 unless such date is extended by the Sovereign Guarantors.

“ Specified Currency Rate ” means in relation to any Put Settlement Asset (i) if Party A or the Sovereign Guarantors assume all of the rights and obligations of Party B under the a currency hedge identified as related to such Put Settlement Asset in the Hedge Agreement Register under the Pledge and Administration Agreement such that Party B has no further rights or obligations under such currency hedge, the rate of exchange specified under such currency hedge or (ii) if (i) is not applicable, by reference to the Federal Reserve Bank of New York 10:00 a.m. (New York City time) mid-point rate as displayed on Reuters Page FEDSPOT on the second Business Day preceding the relevant Put Settlement Date, or if such rate is unavailable, in such other commercially reasonable manner as the Calculation Agent shall determine after consultation with the parties.

“ Subordinated Claims Payment Condition ” has the meaning specified in the Pledge and Administration Agreement.

“ Underlying Assets ” means the assets securing the Put Portfolio Asset for the benefit of the holders of the Put Portfolio Asset and which are expected to generate the cashflows required for the servicing and repayment (in whole or in part) of the Put Portfolio Asset, or the assets which secure and/or support the Issuer’s obligations to the holder of such Put Portfolio Asset where such exposure is created synthetically.

“ Underlying Instruments ” means the indenture, trust agreement, pooling and servicing agreement or other relevant agreement(s) setting forth the terms of the Put Portfolio Asset.

“ Underlying Policy ” means in relation to any Put Portfolio Asset the guarantee or insurance policy, if any, indicated as such in the Put Portfolio Annex.

“ Writedown ” means the occurrence at any time on or after the Effective Date of:

(A) a writedown or applied loss (however described in the Underlying Instruments) resulting in a reduction in the Outstanding Principal Amount (other than as a result of a scheduled or unscheduled payment of principal); or

(B) the attribution of a principal deficiency or realized loss (however described in the Underlying Instruments) to the Put Portfolio Asset resulting in a reduction or subordination of the current interest payable on the Put Portfolio Asset.

“ Writedown Amount ” means, with respect to any day, the product of (i) the amount of any Writedown on such day and (ii) the Applicable Percentage.

Please confirm your agreement to be bound by the terms of the foregoing by executing a copy of this Confirmation and returning it to us.

Yours faithfully,

FSA ASSET MANAGEMENT LLC


By:
	Name:
	Title:


DEXIA SA


By:
	Name:
	Title:

DEXIA CRÉDIT LOCAL S.A. , acting through its New York Branch


By:
	Name:
	Title:

Guaranteed Put Confirmation

Exhibit 10.3.4

(Bilateral Form)

(ISDA Agreements Subject to New York Law Only)

ISDA ®

International Swaps and Derivatives Association, Inc.

CREDIT SUPPORT ANNEX

to the Schedule to the ISDA Master Agreement

dated as of June 30, 2009

between

DEXIA CRÉDIT LOCAL S.A., acting
through its New York Branch, and DEXIA
SA , jointly and severally;

and

FSA ASSET MANAGEMENT LLC

This Annex supplements, forms part of, and is subject to, the above-referenced Agreement, is part of its Schedule and is a Credit Support Document under this Agreement with respect to each party.

Accordingly, the parties agree as follows:—

Paragraph 1. Interpretation

(a) Definitions and Inconsistency. Capitalized terms not otherwise defined herein or elsewhere in this Agreement have the meanings specified pursuant to Paragraph 12, and all references in this Annex to Paragraphs are to Paragraphs of this Annex. In the event of any inconsistency between this Annex and the other provisions of this Schedule, this Annex will prevail, and in the event of any inconsistency between Paragraph 13 and the other provisions of this Annex, Paragraph 13 will prevail.

(b) Secured Party and Pledgor. All references in this Annex to the “Secured Party” will be to either party when acting in that capacity and all corresponding references to the “Pledgor” will be to the other party when acting in that capacity; provided, however, that if Other Posted Support is held by a party to this Annex, all references herein to that party as the Secured Party with respect to that Other Posted Support will be to that party as the beneficiary thereof and will not subject that support or that party as the beneficiary thereof to provisions of law generally relating to security interests and secured parties.

Paragraph 2. Security Interest

Each party, as the Pledgor, hereby pledges to the other party, as the Secured Party, as security for its Obligations, and grants to the Secured Party a first priority continuing security interest in, lien on and right of Set-off against all Posted Collateral Transferred to or received by the Secured Party hereunder. Upon the Transfer by the Secured Party to the Pledgor of Posted Collateral, the security interest and lien granted hereunder on that Posted Collateral will be released immediately and, to the extent possible, without any further action by either party.

Paragraph 3. Credit Support Obligations

(a) Delivery Amount . Subject to Paragraphs 4 and 5, upon a demand made by the Secured Party on or promptly following a Valuation Date, if the Delivery Amount for that Valuation Date equals or exceeds the

Pledgor’s Minimum Transfer Amount, then the Pledgor will Transfer to the Secured Party Eligible Credit Support having a Value as of the date of Transfer at least equal to the applicable Delivery Amount (rounded pursuant to Paragraph 13). Unless otherwise specified in Paragraph 13, the “Delivery Amount” applicable to the Pledgor for any Valuation Date will equal the amount by which:

(i) the Credit Support Amount

exceeds

(ii) the Value as of that Valuation Date of all Posted Credit Support held by the Secured Party.

(b) Return Amount. Subject to Paragraphs 4 and 5, upon a demand made by the Pledgor on or promptly following a Valuation Date, if the Return Amount for that Valuation Date equals or exceeds the Secured Party’s Minimum Transfer Amount, then the Secured Party will Transfer to the Pledgor Posted Credit Support specified by the Pledgor in that demand having a Value as of the date of Transfer as close as practicable to the applicable Return Amount (rounded pursuant to Paragraph 13). Unless otherwise specified in Paragraph 13, the “Return Amount” applicable to the Secured Party for any Valuation Date will equal the amount by which:

(i) the Value as of that Valuation Date of all Posted Credit Support held by the Secured Party exceeds

(ii) the Credit Support Amount.

“Credit Support Amount” means, unless otherwise specified in Paragraph 13, for any Valuation Date (i) the Secured Party’s Exposure for that Valuation Date plus (ii) the aggregate of all Independent Amounts applicable to the Pledgor, if any, minus (iii) all Independent Amounts applicable to the Secured Party, if any, minus (iv) the Pledgor’s Threshold; provided, however, that the Credit Support Amount will be deemed to be zero whenever the calculation of Credit Support Amount yields a number less than zero.

Paragraph 4. Conditions Precedent, Transfer Timing, Calculations and Substitutions

(a) Conditions Precedent. Each Transfer obligation of the Pledgor under Paragraphs 3 and 5 and of the Secured Party under Paragraphs 3, 4(d)(ii), 5 and 6(d) is subject to the conditions precedent that:

(i) no Event of Default, Potential Event of Default or Specified Condition has occurred and is continuing with respect to the other party; and

(ii) no Early Termination Date for which any unsatisfied payment obligations exist has occurred or been designated as the result of an Event of Default or Specified Condition with respect to the other party.

(b) Transfer Timing. Subject to Paragraphs 4(a) and 5 and unless otherwise specified, if a demand for the Transfer of Eligible Credit Support or Posted Credit Support is made by the Notification Time, then the relevant Transfer will be made not later than the close of business on the next Local Business Day; if a demand is made after the Notification Time, then the relevant Transfer will be made not later than the close of business on the second Local Business Day thereafter.

(c) Calculations. All calculations of Value and Exposure for purposes of Paragraphs 3 and 6(d) will be made by the Valuation Agent as of the Valuation Time. The Valuation Agent will notify each party (or the other party, if the Valuation Agent is a party) of its calculations not later than the Notification Time on the Local Business Day following the applicable Valuation Date (or in the case of Paragraph 6(d), following the date of calculation).

(d) Substitutions .

(i) Unless otherwise specified in Paragraph 13, upon notice to the Secured Party specifying the items of Posted Credit Support to be exchanged, the Pledgor may, on any Local Business Day, Transfer to the Secured Party substitute Eligible Credit Support (the “Substitute Credit Support”); and

(ii) subject to Paragraph 4(a), the Secured Party will Transfer to the Pledgor the items of Posted Credit Support specified by the Pledgor in its notice not later than the Local Business Day following the date on which the Secured Party receives the Substitute Credit Support, unless otherwise specified in Paragraph 13 (the “Substitution Date”); provided that the Secured Party will only be obligated to Transfer Posted Credit Support with a Value as of the date of Transfer of that Posted Credit Support equal to the Value as of that date of the Substitute Credit Support.

Paragraph 5. Dispute Resolution

If a party (a “Disputing Party”) disputes (I) the Valuation Agent’s calculation of a Delivery Amount or a Return Amount or (II) the Value of any Transfer of Eligible Credit Support or Posted Credit Support, then (1) the Disputing Party will notify the other party and the Valuation Agent (if the Valuation Agent is not the other party) not later than the close of business on the Local Business Day following (X) the date that the demand is made under Paragraph 3 in the case of (I) above or (Y) the date of Transfer in the case of (II) above, (2) subject to Paragraph 4(a), the appropriate party will Transfer the undisputed amount to the other party not later than the close of business on the Local Business Day following (X) the date that the demand is made under Paragraph 3 in the case of (I) above or (Y) the date of Transfer in the case of (II) above, (3) the parties will consult with each other in an attempt to resolve the dispute and (4) if they fail to resolve the dispute by the Resolution Time, then:

(i) In the case of a dispute involving a Delivery Amount or Return Amount, unless otherwise specified in Paragraph 13, the Valuation Agent will recalculate the Exposure and the Value as of the Recalculation Date by:

(A) utilizing any calculations of Exposure for the Transactions (or Swap Transactions) that the parties have agreed are not in dispute;

(B) calculating the Exposure for the Transactions (or Swap Transactions) in dispute by seeking four actual quotations at mid-market from Reference Market-makers for purposes of calculating Market Quotation, and taking the arithmetic average of those obtained; provided that if four quotations are not available for a particular Transaction (or Swap Transaction), then fewer than four quotations may be used for that Transaction (or Swap Transaction); and if no quotations are available for a particular Transaction (or Swap Transaction), then the Valuation Agent’s original calculations will be used for that Transaction (or Swap Transaction); and

(ii) In the case of a dispute involving the Value of any Transfer of Eligible Credit Support or Posted Credit Support, the Valuation Agent will recalculate the Value as of the date of Transfer pursuant to Paragraph 13.

Following a recalculation pursuant to this Paragraph, the Valuation Agent will notify each party (or the other party, if the Valuation Agent is a party) not later than the Notification Time on the Local Business Day following the Resolution Time. The appropriate party will, upon demand following that notice by the

Valuation Agent or a resolution pursuant to (3) above and subject to Paragraphs 4(a) and 4(b), make the appropriate Transfer.

Paragraph 6. Holding and Using Posted Collateral

(a) Care of Posted Collateral. Without limiting the Secured Party’s rights under Paragraph 6(c), the Secured Party will exercise reasonable care to assure the safe custody of all Posted Collateral to the extent required by applicable law, and in any event the Secured Party will be deemed to have exercised reasonable care if it exercises at least the same degree of care as it would exercise with respect to its own property. Except as specified in the preceding sentence, the Secured Party will have no duty with respect to Posted Collateral, including, without limitation, any duty to collect any Distributions, or enforce or preserve any rights pertaining thereto.

(b) Eligibility to Hold Posted Collateral; Custodians.

(i) General. Subject to the satisfaction of any conditions specified in Paragraph 13 for holding Posted Collateral, the Secured Party will be entitled to hold Posted Collateral or to appoint an agent (a “Custodian”) to hold Posted Collateral for the Secured Party. Upon notice by the Secured Party to the Pledgor of the appointment of a Custodian, the Pledgor’s obligations to make any Transfer will be discharged by making the Transfer to that Custodian. The holding of Posted Collateral by a Custodian will be deemed to be the holding of that Posted Collateral by the Secured Party for which the Custodian is acting.

(ii) Failure to Satisfy Conditions. If the Secured Party or its Custodian fails to satisfy any conditions for holding Posted Collateral, then upon a demand made by the Pledgor, the Secured Party will, not later than five Local Business Days after the demand, Transfer or cause its Custodian to Transfer all Posted Collateral held by it to a Custodian that satisfies those conditions or to the Secured Party if it satisfies those conditions.

(iii) Liability. The Secured Party will be liable for the acts or omissions of its Custodian to the same extent that the Secured Party would be liable hereunder for its own acts or omissions.

(c) Use of Posted Collateral. Unless otherwise specified in Paragraph 13 and without limiting the rights and obligations of the parties under Paragraphs 3, 4(d)(ii), 5, 6(d) and 8, if the Secured Party is not a Defaulting Party or an Affected Party with respect to a Specified Condition and no Early Termination Date has occurred or been designated as the result of an Event of Default or Specified Condition with respect to the Secured Party, then the Secured Party will, notwithstanding Section 9-207 of the New York Uniform Commercial Code, have the right to:

(i) sell, pledge, rehypothecate, assign, invest, use, commingle or otherwise dispose of, or otherwise use in its business any Posted Collateral it holds, free from any claim or right of any nature whatsoever of the Pledgor, including any equity or right of redemption by the Pledgor; and

(ii) register any Posted Collateral in the name of the Secured Party, its Custodian or a nominee for either.

For purposes of the obligation to Transfer Eligible Credit Support or Posted Credit Support pursuant to Paragraphs 3 and 5 and any rights or remedies authorized under this Agreement, the Secured Party will be deemed to continue to hold all Posted Collateral and to receive Distributions made thereon, regardless of whether the Secured Party has exercised any rights with respect to any Posted Collateral pursuant to (i) or (ii) above.

(d) Distributions and Interest Amount.

(i) Distributions. Subject to Paragraph 4(a), if the Secured Party receives or is deemed to receive Distributions on a Local Business Day, it will Transfer to the Pledgor not later than the following Local Business Day any Distributions it receives or is deemed to receive to the extent that a Delivery Amount would not be created or increased by that Transfer, as calculated by the Valuation Agent (and the date of calculation will be deemed to be a Valuation Date for this purpose).

(ii) Interest Amount. Unless otherwise specified in Paragraph 13 and subject to Paragraph 4(a), in lieu of any interest, dividends or other amounts paid or deemed to have been paid with respect to Posted Collateral in the form of Cash (all of which may be retained by the Secured Party), the Secured Party will Transfer to the Pledgor at the times specified in Paragraph 13 the Interest Amount to the extent that a Delivery Amount would not be created or increased by that Transfer, as calculated by the Valuation Agent (and the date of calculation will be deemed to be a Valuation Date for this purpose). The Interest Amount or portion thereof not Transferred pursuant to this Paragraph will constitute Posted Collateral in the form of Cash and will be subject to the security interest granted under Paragraph 2.

Paragraph 7. Events of Default

For purposes of Section 5(a)(iii)(1) of this Agreement, an Event of Default will exist with respect to a party if:

(i) that party fails (or fails to cause its Custodian) to make, when due, any Transfer of Eligible Collateral, Posted Collateral or the Interest Amount, as applicable, required to be made by it and that failure continues for two Local Business Days after notice of that failure is given to that party;

(ii) that party fails to comply with any restriction or prohibition specified in this Annex with respect to any of the rights specified in Paragraph 6(c) and that failure continues for five Local Business Days after notice of that failure is given to that party; or

(iii) that party fails to comply with or perform any agreement or obligation other than those specified in Paragraphs 7(i) and 7(ii) and that failure continues for 30 days after notice of that failure is given to that party.

Paragraph 8. Certain Rights and Remedies

(a) Secured Party’s Rights and Remedies. If at any time (1) an Event of Default or Specified Condition with respect to the Pledgor has occurred and is continuing or (2) an Early Termination Date has occurred or been designated as the result of an Event of Default or Specified Condition with respect to the Pledgor, then, unless the Pledgor has paid in full all of its Obligations that are then due, the Secured Party may exercise one or more of the following rights and remedies:

(i) all rights and remedies available to a secured party under applicable law with respect to Posted Collateral held by the Secured Party;

(ii) any other rights and remedies available to the Secured Party under the terms of Other Posted Support, if any;

(iii) the right to Set-off any amounts payable by the Pledgor with respect to any Obligations against any Posted Collateral or the Cash equivalent of any Posted Collateral held by the Secured Party (or any obligation of the Secured Party to Transfer that Posted Collateral); and

(iv) the right to liquidate any Posted Collateral held by the Secured Party through one or more public or private sales or other dispositions with such notice, if any, as may be required under applicable law, free from any claim or right of any nature whatsoever of the Pledgor, including any equity or right of redemption by the Pledgor (with the Secured Party having the right to purchase any

or all of the Posted Collateral to be sold) and to apply the proceeds (or the Cash equivalent thereof) from the liquidation of the Posted Collateral to any amounts payable by the Pledgor with respect to any Obligations in that order as the Secured Party may elect.

Each party acknowledges and agrees that Posted Collateral in the form of securities may decline speedily in value and is of a type customarily sold on a recognized market, and, accordingly, the Pledgor is not entitled to prior notice of any sale of that Posted Collateral by the Secured Party, except any notice that is required under applicable law and cannot be waived.

(b) Pledgor’s Rights and Remedies. If at any time an Early Termination Date has occurred or been designated as the result of an Event of Default or Specified Condition with respect to the Secured Party, then (except in the case of an Early Termination Date relating to less than all Transactions (or Swap Transactions) where the Secured Party has paid in full all of its obligations that are then due under Section 6(e) of this Agreement):

(i) the Pledgor may exercise all rights and remedies available to a pledgor under applicable law with respect to Posted Collateral held by the Secured Party;

(ii) the Pledgor may exercise any other rights and remedies available to the Pledgor under the terms of Other Posted Support, if any;

(iii) the Secured Party will be obligated immediately to Transfer all Posted Collateral and the Interest Amount to the Pledgor; and

(iv) to the extent that Posted Collateral or the Interest Amount is not so Transferred pursuant to (iii) above, the Pledgor may:

(A) Set-off any amounts payable by the Pledgor with respect to any Obligations against any Posted Collateral or the Cash equivalent of any Posted Collateral held by the Secured Party (or any obligation of the Secured Party to Transfer that Posted Collateral); and

(B) to the extent that the Pledgor does not Set-off under (iv)(A) above, withhold payment of any remaining amounts payable by the Pledgor with respect to any Obligations, up to the Value of any remaining Posted Collateral held by the Secured Party, until that Posted Collateral is Transferred to the Pledgor.

(c) Deficiencies and Excess Proceeds. The Secured Party will Transfer to the Pledgor any proceeds and Posted Credit Support remaining after liquidation, Set-off and/or application under Paragraphs 8(a) and 8(b) after satisfaction in full of all amounts payable by the Pledgor with respect to any Obligations; the Pledgor in all events will remain liable for any amounts remaining unpaid after any liquidation, Set-off and/or application under Paragraphs 8(a) and 8(b).

(d) Final Returns. When no amounts are or thereafter may become payable by the Pledgor with respect to any Obligations (except for any potential liability under Section 2(d) of this Agreement), the Secured Party will Transfer to the Pledgor all Posted Credit Support and the Interest Amount, if any.

Paragraph 9. Representations

Each party represents to the other party (which representations will be deemed to be repeated as of each date on which it, as the Pledgor, Transfers Eligible Collateral) that:

(i) it has the power to grant a security interest in and lien on any Eligible Collateral it Transfers as the Pledgor and has taken all necessary actions to authorize the granting of that security interest and lien;

(ii) it is the sole owner of or otherwise has the right to Transfer all Eligible Collateral it Transfers to the Secured Party hereunder, free and clear of any security interest, lien, encumbrance or other restrictions other than the security interest and lien granted under Paragraph 2,

(iii) upon the Transfer of any Eligible Collateral to the Secured Party under the terms of this Annex, the Secured Party will have a valid and perfected first priority security interest therein (assuming that any central clearing corporation or any third-party financial intermediary or other entity not within the control of the Pledgor involved in the Transfer of that Eligible Collateral gives the notices and takes the action required of it under applicable law for perfection of that interest); and

(iv) the performance by it of its obligations under this Annex will not result in the creation of any security interest, lien or other encumbrance on any Posted Collateral other than the security interest and lien granted under Paragraph 2.

Paragraph 10. Expenses

(a) General. Except as otherwise provided in Paragraphs 10(b) and 10(c), each party will pay its own costs and expenses in connection with performing its obligations under this Annex and neither party will be liable for any costs and expenses incurred by the other party in connection herewith.

(b) Posted Credit Support. The Pledgor will promptly pay when due all taxes, assessments or charges of any nature that are imposed with respect to Posted Credit Support held by the Secured Party upon becoming aware of the same, regardless of whether any portion of that Posted Credit Support is subsequently disposed of under Paragraph 6(c), except for those taxes, assessments and charges that result from the exercise of the Secured Party’s rights under Paragraph 6(c).

(c) Liquidation/Application of Posted Credit Support. All reasonable costs and expenses incurred by or on behalf of the Secured Party or the Pledgor in connection with the liquidation and/or application of any Posted Credit Support under Paragraph 8 will be payable, on demand and pursuant to the Expenses Section of this Agreement, by the Defaulting Party or, if there is no Defaulting Party, equally by the parties.

Paragraph 11. Miscellaneous

(a) Default Interest. A Secured Party that fails to make, when due, any Transfer of Posted Collateral or the Interest Amount will be obligated to pay the Pledgor (to the extent permitted under applicable law) an amount equal to interest at the Default Rate multiplied by the Value of the items of property that were required to be Transferred, from (and including) the date that Posted Collateral or Interest Amount was required to be Transferred to (but excluding) the date of Transfer of that Posted Collateral or Interest Amount. This interest will be calculated on the basis of daily compounding and the actual number of days elapsed.

(b) Further Assurances. Promptly following a demand made by a party, the other party will execute, deliver, file and record any financing statement, specific assignment or other document and take any other action that may be necessary or desirable and reasonably requested by that party to create, preserve, perfect or validate any security interest or lien granted under Paragraph 2, to enable that party to exercise or enforce its rights under this Annex with respect to Posted Credit Support or an Interest Amount or to effect or document a release of a security interest on Posted Collateral or an Interest Amount.

(c) Further Protection. The Pledgor will promptly give notice to the Secured Party of, and defend against, any suit, action, proceeding or lien that involves Posted Credit Support Transferred by the Pledgor or that could adversely affect the security interest and lien granted by it under Paragraph 2, unless that suit, action, proceeding or lien results from the exercise of the Secured Party’s rights under Paragraph 6(c).

(d) Good Faith and Commercially Reasonable Manner. Performance of all obligations under this Annex, including, but not limited to, all calculations, valuations and determinations made by either party, will be made in good faith and in a commercially reasonable manner.

(e) Demands and Notices . All demands and notices made by a party under this Annex will be made as specified in the Notices Section of this Agreement, except as otherwise provided in Paragraph 13.

(f) Specifications of Certain Matters. Anything referred to in this Annex as being specified in Paragraph 13 also may be specified in one or more Confirmations or other documents and this Annex will be construed accordingly.

Paragraph 12. Definitions

As used in this Annex:—

“Cash” means the lawful currency of the United States of America.

“Credit Support Amount” has the meaning specified in Paragraph 3

“Custodian” has the meaning specified in Paragraphs 6(b)(i) and 13.

“Delivery Amount” has the meaning specified in Paragraph 3(a).

“Disputing Party” has the meaning specified in Paragraph 5.

“Distributions” means with respect to Posted Collateral other than Cash, all principal, interest and other payments and distributions of cash or other property with respect thereto, regardless of whether the Secured Party has disposed of that Posted Collateral under Paragraph 6(c). Distributions will not include any item of property acquired by the Secured Party upon any disposition or liquidation of Posted Collateral or, with respect to any Posted Collateral in the form of Cash, any distributions on that collateral, unless otherwise specified herein.

“Eligible Collateral” means, with respect to a party, the items, if any, specified as such for that party in Paragraph 13.

“Eligible Credit Support” means Eligible Collateral and Other Eligible Support.

“Exposure” means for any Valuation Date or other date for which Exposure is calculated and subject to Paragraph 5 in the case of a dispute, the amount, if any, that would be payable to a party that is the Secured Party by the other party (expressed as a positive number) or by a party that is the Secured Party to the other party (expressed as a negative number) pursuant to Section 6(e)(ii)(2)(A) of this Agreement as if all Transactions (or Swap Transactions) were being terminated as of the relevant Valuation Time; provided that Market Quotation will be determined by the Valuation Agent using its estimates at mid-market of the amounts that would be paid for Replacement Transactions (as that term is defined in the definition of “Market Quotation”).

“Independent Amount” means, with respect to a party, the amount specified as such for that party in Paragraph 13; if no amount is specified, zero.

“Interest Amount” means, with respect to an Interest Period, the aggregate sum of the amounts of interest calculated for each day in that Interest Period on the principal amount of Posted Collateral in the form of Cash held by the Secured Party on that day, determined by the Secured Party for each such day as follows:

(x) the amount of that Cash on that day; multiplied by

(y) the Interest Rate in effect for that day; divided by

(z) 360.

“Interest Period” means the period from (and including) the last Local Business Day on which an Interest Amount was Transferred (or, if no Interest Amount has yet been Transferred, the Local Business Day on which Posted Collateral in the form of Cash was Transferred to or received by the Secured Party) to (but excluding) the Local Business Day on which the current Interest Amount is to be Transferred.

“Interest Rate” means the rate specified in Paragraph 13.

“Local Business Day” , unless otherwise specified in Paragraph 13, has the meaning specified in the Definitions Section of this Agreement, except that references to a payment in clause (b) thereof will be deemed to include a Transfer under this Annex.

“Minimum Transfer Amount” means, with respect to a party, the amount specified as such for that party in Paragraph 13; if no amount is specified, zero.

“Notification Time” has the meaning specified in Paragraph 13.

“Obligations” means, with respect to a party, all present and future obligations of that party under this Agreement and any additional obligations specified for that party in Paragraph 13.

“Other Eligible Support” means, with respect to a party, the items, if any, specified as such for that party in Paragraph 13.

“Other Posted Support” means all Other Eligible Support Transferred to the Secured Party that remains in effect for the benefit of that Secured Party.

“Pledgor” means either party, when that party (i) receives a demand for or is required to Transfer Eligible Credit Support under Paragraph 3(a) or (ii) has Transferred Eligible Credit Support under Paragraph 3(a).

“Posted Collateral” means all Eligible Collateral, other property, Distributions, and all proceeds thereof that have been Transferred to or received by the Secured Party under this Annex and not Transferred to the Pledgor pursuant to Paragraph 3(b), 4(d)(ii) or 6(d)(i) or released by the Secured Party under Paragraph 8. Any Interest Amount or portion thereof not Transferred pursuant to Paragraph 6(d)(ii) will constitute Posted Collateral in the form of Cash.

“Posted Credit Support” means Posted Collateral and Other Posted Support.

“Recalculation Date” means the Valuation Date that gives rise to the dispute under Paragraph 5; provided, however, that if a subsequent Valuation Date occurs under Paragraph 3 prior to the resolution of the dispute, then the “Recalculation Date” means the most recent Valuation Date under Paragraph 3.

“Resolution Time” has the meaning specified in Paragraph 13.

“Return Amount” has the meaning specified in Paragraph 3(b).

“Secured Party” means either party, when that party (i) makes a demand for or is entitled to receive Eligible Credit Support under Paragraph 3(a) or (ii) holds or is deemed to hold Posted Credit Support.

“Specified Condition” means, with respect to a party, any event specified as such for that party in Paragraph 13.

“Substitute Credit Support” has the meaning specified in Paragraph 4(d)(i).

“Substitution Date” has the meaning specified in Paragraph 4(d)(ii).

“Threshold” means, with respect to a party, the amount specified as such for that party in Paragraph 13; if no amount is specified, zero.

“Transfer” means, with respect to any Eligible Credit Support, Posted Credit Support or Interest Amount, and in accordance with the instructions of the Secured Party, Pledgor or Custodian, as applicable:

(i) in the case of Cash, payment or delivery by wire transfer into one or more bank accounts specified by the recipient;

(ii) in the case of certificated securities that cannot be paid or delivered by book-entry, payment or delivery in appropriate physical form to the recipient or its account accompanied by any duly executed instruments of transfer, assignments in blank, transfer tax stamps and any other documents necessary to constitute a legally valid transfer to the recipient;

(iii) in the case of securities that can be paid or delivered by book-entry, the giving of written instructions to the relevant depository institution or other entity specified by the recipient, together with a written copy thereof to the recipient, sufficient if complied with to result in a legally effective transfer of the relevant interest to the recipient; and

(iv) in the case of Other Eligible Support or Other Posted Support, as specified in Paragraph 13.

“Valuation Agent” has the meaning specified in Paragraph 13.

“Valuation Date” means each date specified in or otherwise determined pursuant to Paragraph 13.

“Valuation Percentage” means, for any item of Eligible Collateral, the percentage specified in Paragraph 13.

“Valuation Time” has the meaning specified in Paragraph 13.

“Value” means for any Valuation Date or other date for which Value is calculated and subject to Paragraph 5 in the case of a dispute, with respect to:

(i) Eligible Collateral or Posted Collateral that is:

(A) Cash, the amount thereof, and

(B) a security, the bid price obtained by the Valuation Agent multiplied by the applicable Valuation Percentage, if any;

(ii) Posted Collateral that consists of items that are not specified as Eligible Collateral, zero; and

(iii) Other Eligible Support and Other Posted Support, as specified in Paragraph 13.

Execution Version

ISDA®

CREDIT SUPPORT ANNEX

(New York Law)

to the Schedule to the

ISDA Master Agreement

Guaranteed Put Contract

dated as of June 30, 2009 between

DEXIA CRÉDIT LOCAL S.A., acting through its New York Branch, and DEXIA SA (jointly and
severally) (hereinafter together referred to as “Party A” or “Pledgor” )

and

FSA ASSET MANAGEMENT LLC, (hereinafter referred to as “Party B” or “Secured Party” ).

Paragraph 13. Elections and Variables.

(a) Security Interest for “Obligations”.

(i) Paragraph 2 is amended by adding, immediately after the words “lien on and right of Set-off against”, the words “the Dexia Collateral Account, and all the property from time to time credited thereto or carried therein, and the proceeds thereof, including without limitation”.

(ii) The term “Obligations” as used in this Annex includes the following additional obligations:

With respect to Party A: not applicable.

With respect to Party B: not applicable.

(b) Credit Support Obligations.

(i) Eligible Collateral .

On any date, the categories of assets denominated in U.S. Dollars or Euros and designated as “CSA Eligible” on Schedule A hereto qualify as “ Eligible Collateral ” and the Valuation Percentage for each such category shall be the percentage corresponding to the current rating for such category on the relevant Valuation Date. For the avoidance of doubt, any asset that is not Eligible Collateral shall have a Value of zero for all purposes under this Credit Support Annex. Cash in U.S. Dollars shall also constitute Eligible Collateral.

(ii) Other Eligible Support.

The following items will qualify as “Other Eligible Support” for the party specified:

Not applicable.

(iii) Threshold.

(A) “Independent Amount” with respect to Party A or to Party B, is not applicable.

(B) “Threshold” means, with respect to Party A, USD 5,000,000, unless the Subordinated Claims Payment Condition is not met, in which case it will be zero.

“Threshold” , with respect to Party B and any Valuation Date is not applicable.

(C) “Minimum Transfer Amount” means, with respect to Party A and Party B, USD 5,000,000 , unless the Subordinated Claims Payment Condition is not met, in which case it will be zero with respect to Party A, and infinity with respect to Party B.

(D) Rounding : The Delivery Amount will be rounded up to the nearest integral multiple of USD 10,000. The Return Amount will be rounded down to the nearest integral multiple of USD 10,000.

(c) Valuation and Timing .

(i) “Valuation Agent” means the Reporting Agent (as defined in the Pledge and Administration Agreement).

(ii) “Valuation Date” means each of (A) the earlier of (x) September 28, 2011 and (y) any Sovereign Guarantee Unenforceability Date (the “ First Valuation Date ”), (B) each day after the First Valuation Date which is the last Business Day in a calendar week, (each of the days in (A) and (B) a “ Scheduled Valuation Date ”) and (C) any additional Business Day requested to be a Valuation Date by FSA or Party A from time to time which is not a Scheduled Valuation Date (and is after the First Valuation Date) and is notified to Party A or Party B and FSA, as applicable and the Valuation Agent at least one Business Day in advance of the proposed additional Valuation Date (each an “ Additional Valuation Date ”), provided that the number of Additional Valuation Dates requested by FSA shall not exceed 10 in any calendar year (and the number of Additional Valuation Dates requested by Party A is not limited).

(iii) “Valuation Time” means the close of business in the city of the Valuation Agent on the Local Business Day immediately preceding the Valuation Date or date of calculation, as applicable; provided that the calculations of Value and Exposure will be made as of approximately the same time on the same date.

(iv) “Notification Time ” means 11:00 a.m., New York City time, on a Local Business Day.

(v) Deemed Demand . Paragraph 3(a) is amended by adding, immediately following the words “upon a demand made by the Secured Party” in Paragraph 3(a), the words “(which demand shall be deemed as having been validly made automatically upon receipt of notice from the Valuation Agent of a Delivery Amount resulting from the Valuation Agent’s calculations on any Valuation Date)”.

(vi) “ Value ” means FSAM Asset Value.

(vii) No DCL Collateral Period and No Dexia Collateral Period .

(A) With respect to any date which falls during a period which is (A) not on or after a Sovereign Guarantee Unenforceability Date and (B) (I) on and after the First Collateral Posting Date and prior to the Liquidity and Collateral Trigger Expiration Date or (II) during a period that a DCL Bankruptcy has occurred and is continuing (a “ No DCL Collateral Period ”), (i) any Eligible Collateral Transferred by DCL, whether at any time before or during such No DCL Collateral Period, will be deemed to have a Value of zero during such No DCL Collateral Period (any such Eligible Collateral on any date during

the No DCL Collateral Period the “ Affected DCL Collateral ”) and (ii) only postings made by Dexia (whether made at any time before or during such No DCL Collateral Period, and including by substitution in accordance with the Credit Support Annex of Eligible Collateral posted by Dexia for Eligible Collateral posted by DCL) will be considered in calculating any applicable Delivery Amount and whether the obligation to Transfer Eligible Collateral with a Value equal to such Delivery Amount has been met during such No DCL Collateral Period; provided, that such Affected DCL Collateral shall be Transferred to DCL against the simultaneous delivery of replacement Eligible Collateral by Dexia.

(B) With respect to any date which falls during a period which is (A) on or after a Sovereign Guarantee Unenforceability Date and (B) not during a period that a DCL Bankruptcy has occurred and is continuing (a “ No Dexia Collateral Period ”), (i) any Eligible Collateral Transferred by Dexia, whether at any time before or during such No Dexia Collateral Period, will be deemed to have a Value of zero during such No Dexia Collateral Period (any such Eligible Collateral on any date during the No Dexia Collateral Period the “ Affected Dexia Collateral ”) and (ii) only postings made by DCL (whether made at any time before or during such No Dexia Collateral Period, and including by substitution in accordance with the Credit Support Annex of Eligible Collateral posted by DCL for Eligible Collateral posted by Dexia) will be considered in calculating any applicable Delivery Amount and whether the obligation to Transfer Eligible Collateral with a Value equal to such Delivery Amount has been met during such No Dexia Collateral Period; provided, that such Affected Dexia Collateral shall be Transferred to Dexia against the simultaneous delivery of replacement Eligible Collateral by DCL.

(C) In relation to any Put Settlement Date arising from a Collateral Default Trigger occurring during a No DCL Collateral Period or No Dexia Collateral Period, Party B shall Transfer to Party A the relevant Affected DCL Collateral or Affected Dexia Collateral as of the date of occurrence of the relevant Collateral Default Trigger as part of the Put Settlement Assets delivered to Party A on such Put Settlement Date (unless Party A has already effected a substitution for such Affected DCL Collateral or Affected Dexia Collateral as described in Paragraph 13(c)(vii)).

(viii) In the event that a Put Settlement Date occurs (i) on or after a DCL Belgian Corporate Reorganization has occurred and (ii) prior to the date on which (1) the Collateral Replacement Date has occurred and (2) Eligible Collateral having a Value equal to the Delivery Amount determined on the Collateral Replacement Date shall have been Transferred under the Credit Support Annex, and except in the case of a Put Settlement under which the Put Settlement Amount is paid to Party B by the Sovereign Guarantors, (A) Party A will be required to pay the Put Settlement Amount on the Put Settlement Date, (B) Party B will not be required to Deliver the related Put Settlement Assets until the date following the Put Settlement Date on which the Belgian Preference Period has expired and (C) pending such Delivery on the date referred to in (B), Party A will be deemed to have pledged the relevant Put Settlement Assets to Party B and Party B shall hold such Put Settlement Assets as additional Posted Collateral hereunder (“ Repledged Assets”).

(d) Substitution.

(i) “ Substitution Date ” has the meaning specified in Paragraph 4(d)(ii).

(ii) Consent. If specified here as applicable, then the Pledgor must obtain the Secured Party’s consent for any substitution pursuant to Paragraph 4(d): Inapplicable.

(e) Dispute Resolution .

(i) “Resolution Time” means 1:00 p.m. New York time on the Local Business Day following the date on which the notice of the dispute is given under Paragraph 5.

(ii) Value. The provisions of Paragraph 5 will apply, provided, however, that any dispute as to the Indicative Market Value of any FSAM Asset shall be resolved as set forth in the definition of “FSAM Asset Value” and, to such extent, the provisions of Paragraph 5 shall not apply.

(f) Holding and Using Posted Collateral .

(i) Eligibility to Hold Posted Collateral; Custodians. Party B (through the Custodian) will be entitled to hold Posted Collateral pursuant to Paragraph 6(b).

The Custodian for Party B is: Wells Fargo Bank, National Association.

Party A and Party B agree that (x) Posted Collateral that is denominated in USD, or that is Cash that is USD, will be credited to the Dexia Collateral Account and held in the United States of America, and (y) all other Posted Collateral will either be deposited in the Dexia Collateral Account or granted to the Custodian directly acting as representative for the benefit of Party B and held by the Custodian in a special designated pledged account opened in its name in the Euroclear System with Euroclear Bank NV/SA in accordance with Euroclear’s Multi Pledgor Pledged Account Terms and Conditions (the “MPAA Account”). The Custodian may use agents and affiliates for purposes of opening, managing and operating the MPAA Account.

Notwithstanding the foregoing, if both a DCL Belgian Corporate Reorganization and a Sovereign Guarantee Unenforceability Date have occurred, all Transfers of Eligible Collateral will be made through, and all Posted Collateral will be held in, the MPAA Account or another account (or subaccount or subcustody arrangement) maintained in the Euroclear System.

(ii) Use of Posted Collateral. The provisions of Paragraph 6(c)(i) will not apply to Party B, and the provisions of Paragraph 6(c)(ii) will apply to Party B; provided, however, that

(A) on any date on which the Collateral Agent or FSA has delivered a Payment Failure Notice (as defined in the Pledge and Administration Agreement) and the payment failure identified in such Payment Failure Notice has not been cured on the third Business Day following the Collateral Agent or FSA’s delivery of such Payment Failure Notice Paragraph 6(c)(i) will apply to Party B such that the Collateral Agent and/or FSA shall have the rights, subject to the terms and limitations of the Pledge and Administration Agreement, to (x) enter into a Temporary Funding Transaction (as defined in the Pledge and Administration Agreement) in relation to any Posted Collateral held by the Collateral Agent hereunder or (y) solely in the circumstances described in Section 11.2(b)(i)(C) of the Pledge and Administration Agreement, to effect a Liquidation of Posted Collateral by sale for its obtainable market value, and in each case apply the proceeds of such transaction in (x) or (y) to satisfy one or more scheduled or expected Senior Priority Payments identified in accordance with the provisions Section 11.2(b) of the Pledge and

Administration Agreement at or prior to the time when such Payment Failure Notice was sent (“ Required Senior Priority Payments ”), and any such application of the proceeds of such transaction in (x) or (y) shall also be deemed to satisfy (to the extent of such proceeds) any Liquidity Draw Request which is outstanding and has not been funded on the date such proceeds are applied;

(B) on any date on or after the Collateral Replacement Date on which the Administrator, the Collateral Agent or FSA has delivered a GIC Termination Liquidity Draw and the relevant Bank under (and as defined in) the Liquidity Facility or Buyer under (and as defined in) the Repurchase Facility Agreement, as applicable, has not performed its payment obligations within the time required under the Liquidity Facility or Repurchase Facility Agreement, as applicable, Paragraph 6(c)(i) will apply to Party B such that the Collateral Agent and/or FSA shall have the rights to enter into a Temporary Funding Transaction in relation to any Posted Collateral held by the Collateral Agent hereunder, and apply the proceeds of such transaction to satisfy the relevant GIC Termination Liquidity Draw; and

(C) Party B or, if a Dexia Event of Default has occurred, the Collateral Agent or FSA directly as third party beneficiary, may instruct the transfer of any Posted Collateral which is eligible to be posted as collateral to secure either (x) a FSA GIC Contract or (y) a Third Party Hedge Agreement which is not a Subordinated Hedge Agreement to the collateral account for such FSA GIC Contract or Third Party Hedge Agreement, as applicable, and Paragraph 6(c)(i) will apply to Party B to the extent necessary to permit such actions in (x) or (y); and

(D) If on any date the “Offset of Collateral” provision is applicable under the Confirmation to this Agreement, FSA as the Secured Party Representative shall identify one or more items of Eligible Collateral having a Value equal to the Deemed Return Amount that will be released to Party B in consideration for the corresponding reduction of the Put Settlement Amount in relation to such Deemed Return Amount.

Any use of Posted Collateral (or the cash proceeds thereof) provided for under (A) through (C) shall not be considered a Set-off under Paragraph 8(a)(iii) or otherwise affect the inclusion of the Value of such Posted Collateral as Posted Credit Support held by the Secured Party for purposes of Paragraph 3 or the determination of any Delivery Amount or Return Amount thereunder, provided that (x) the Value of any Posted Collateral Liquidated under (ii)(A)(y) above, or Liquidated in connection with the termination of a Temporary Funding Transaction, shall be fixed at the FSAM Asset Value thereof as most recently determined hereunder at the time of such Liquidation (in connection with the Collateral Sale Deficiency Amount and Collateral Sale Excess Amount adjustments referred to below) and (y) to the extent that the Liquidation Proceeds of any sale or cash obtained in a Temporary Financing Transaction have been applied to satisfy a Qualifying Liquidity Payment (a “ Liquidity Draw Offset ”), the portion of the FSAM Asset Value of the relevant Eligible Collateral obtained by multiplying (i) such FSAM Asset Value times (ii) the relevant Liquidity Offset Fraction, shall be no longer be included in determining the Value of Posted Credit Support held by the Secured Party for purposes of Paragraph 3 or the determination of any Delivery Amount or Return Amount hereunder.

(g) Distributions and Interest Amount.

(i) Distributions. The provisions of Paragraph 6(d)(i) will not apply. The Custodian shall credit all Distributions received to the Dexia Collateral Account or the MPAA Account,

as applicable. “ Dexia Collateral Account ” has the meaning set forth in the Pledge and Administration Agreement.

(ii) Interest Amount. The provisions of Paragraph 6(d)(ii) will apply, provided that (I) Posted Collateral in the form of Cash may be invested only in cash equivalent investments eligible under the ALM Procedures and agreed between the Custodian and the Administrator from time to time and (II) the amount of interest on Posted Collateral in the form of Cash on any date will be calculated by the Custodian based on the relevant investments in (I).

(h) Additional Representation(s). There are no additional representations by either party.

(i) Other Eligible Support and Other Posted Support.

(i) “Value” with respect to Other Eligible Support and Other Posted Support means: not applicable.

(ii) “Transfer” with respect to Other Eligible Support and Other Posted Support means: not applicable.

(j) Demands and Notices. All demands, specifications and notices under this Annex will be made pursuant to the Notices Section of this Agreement, except that any demand, specification or notice shall be given to or made at the following addresses, or at such other address as the relevant party may from time to time designate by giving notice (in accordance with the terms of this paragraph) to the other party:

If to Party A, at the address specified pursuant to the Notices Section of this Agreement.

If to Party B, at the address specified pursuant to the Notices Section of this Agreement.

If to Party B’s Custodian: Same address as if to Party B pursuant to the Notices Section of this Agreement.

(k) Address for Transfers. Each Transfer hereunder shall be made to the address specified in writing from time to time by the party to which such Transfer will be made.

Party A account details — To be provided.

Party B account details — To be provided.

(l) Additional Transfers. On any date, whether or not a Valuation Date, Party A may at its option Transfer additional Eligible Collateral to the Dexia Collateral Account for the purpose of making the resulting Posted Collateral available for use by Party B in the manner contemplated by (f)(ii)(B) above.

(m) Other Provisions.

(i) Collateral Account. Party A and Party B acknowledge and agree that the Custodian shall hold, record and identify all Posted Collateral in the Dexia Collateral Account or the MPAA Account.

(ii) Agreement as to Single Secured Party and Single Pledgor . Party A and Party B hereby agree that, notwithstanding anything to the contrary in this Annex, (a) the term “Secured Party” as used in this Annex means only Party B, (b) the term “Pledgor” as used in this

Annex means only Party A, (c) only Party A makes the pledge and grant in Paragraph 2, the acknowledgement in the final sentence of Paragraph 8(a) and the representations in Paragraph 9.

(iii) Events of Default.

Paragraph 7 shall not apply. A ny failure by Party A to comply with or perform any obligation to be complied with or performed by Party A under this Credit Support Annex shall only be an Event of Default if Section 5(a)(i) of the Agreement (as amended by the Schedule) is or becomes applicable thereto.

(iv) Additional Definitions . As used in this Annex:

“ALM Noncompliance Amount” means on any date of determination on which a Dexia Event of Default has not occurred, the sum of (i) the aggregate of the ALM Noncompliance Derivative Amounts plus (ii) the ALM Noncompliance Operational Amount.

“ ALM Noncompliance Derivative Amount ” means on any date of determination on which a Dexia Event of Default has not occurred, and in relation to any interest rate, currency or other derivative transaction (whether such transaction would be classified as an Asset Swap or a Liability Swap) which (1) either (A) Party A has agreed, following an objection by FSA, was required to have been effected in order to comply with the ALM Procedures or (B) the ALM Arbiter has concluded was required to have been effected in order to comply with the ALM Procedures, as applicable, and (2) has not yet been effected by Party B, an amount equal to the FSAM Liability Swap Benefit or FSAM Asset Swap Benefit, as applicable, that would result from such transaction having been effected on the date the ALM Arbiter determines (or that Party A agrees with FSA) that it should have been effected and currently being in effect on such date of determination. In determining such FSAM Liability Swap Benefit or FSAM Asset Swap Benefit the Valuation Agent may rely on the determination of FSAM’s swap counterparty under any Third Party Hedge Agreement or on the determination of the ALM Arbiter.

“ ALM Noncompliance Operational Amount ” means on any date of determination on which (A) either (i) the ALM Arbiter has concluded (or Party A has agreed, following an objection by FSA) that Party B has failed to comply with a requirement of the ALM Procedures or (ii) the ALM Arbiter has concluded (or Party A has agreed, following an objection by FSA) that Party B has adopted an amendment or modification to the ALM Procedures (other than a Dexia Policy Amendment) such that the amended ALM Procedures do not constitute a reasonable and prudent asset and liability management policy in accordance with prevailing market standards for portfolio management activities of the same type, (B) FSA has not consented to the relevant noncompliance, amendment or modification and (C) Party B has failed to remedy the relevant noncompliance or rescind the relevant amendment or modification to the ALM Procedures, an amount equal to 25% times the Spread Component of the GIC Business Costs Amount as most recently determined on such date.

“ Collateral Replacement Date ” means the earlier to occur of (i) the First Collateral Posting Date, and (ii) any Sovereign Guarantee Unenforceability Date.

“ Collateral Sale Excess Amount ” means in relation to each item of Eligible Collateral Liquidated by Party B or the Collateral Agent in the circumstances set forth in Paragraph 13(f)(ii)(A)(y), (A) one minus the Liquidity Offset Fraction times (B) the excess, if any, of (i) the relevant Liquidation Proceeds over (ii) the FSAM Asset Value of such item of Eligible Collateral as most recently determined hereunder at the time of such Liquidation.

“ Collateral Sale Deficiency Amount ” means in relation to each item of Eligible Collateral sold by Party B or the Collateral Agent in the circumstances set forth in Paragraph 13(f)(ii)(A)(y), (A) one minus the Liquidity Offset Fraction times (B) the excess, if any, of (i) the FSAM Asset Value of such item of Eligible Collateral as most recently determined hereunder at the time of such Liquidation over (ii) the applicable Liquidation Proceeds.

“ Collateral Value ” means, with respect to each Hedge Agreement, the Value of the Posted Collateral held by the Collateral Agent on behalf of FSAM (and, for the avoidance of doubt, not merely held by DCL as Credit Support Provider of FSAM under the relevant Hedge Agreement) in relation to each Hedge Agreement, as determined by the Valuation Agent. For purpose of the foregoing, with respect to any Hedge Agreement, “Value” and “Posted Collateral” shall have the meanings set forth in Hedge Agreement, and the Valuation Agent may rely on the determination of such Value by the Valuation Agent (as defined in the relevant Hedge Agreement) in accordance with the terms of the relevant Hedge Agreement.

“ Dexia Policy Amendment ” means an amendment or modification to the ALM Procedures that is necessary, as reasonably evidenced to FSA by Party A, to conform such ALM Procedures to generally applicable risk management policies within the Dexia group.

“Exposure” means on any date of determination:

Prior to the Collateral Replacement Date, zero.

On the Collateral Replacement Date and from time to time thereafter, an amount equal to the sum, which shall not be less than zero, of:

(1) the sum of

(A) the aggregate GIC Redemption Balance of the FSA GIC Contracts as of such date, plus

(B) the GIC Business Costs Amount most recently calculated on or prior to such date, plus

(D) the aggregate of all the FSAM Asset Swap Costs and all the FSAM Liability Swap Costs, in each case in relation to Third Party Hedge Agreements other than Third Party Hedge Agreements which are Qualifying Hedge Agreements on such date; plus

(E) to the extent that (x) the “Credit Support Amount” applicable to FSAM in relation to any Third Party Hedge Agreement that is not a Qualifying Hedge Agreement as of such date, plus or minus any “unpaid amounts” that are outstanding between the parties exceeds (y) the amount determined in relation to such Third Party Hedge Agreement under (D), the aggregate of such excess of (x) over (y) in relation to all such Third Party Hedge Agreements; plus

(F) the ALM Noncompliance Amount (if any); plus

(G) the Lien Creditor Amount (if any); plus

(H) the Principal Forgiveness Amount (if any); plus

(I) the aggregate of the Collateral Sale Deficiency Amounts determined on or prior to such date, if any;

minus

(2) the sum of

(A) the aggregate FSAM Asset Value of the Put Portfolio Assets, plus

(B) the aggregate FSAM Asset Value of the Excluded Assets and Other Assets (including without duplication (I) cash proceeds of any Defaulted Collateral Amount that has been paid by the Sovereign Guarantors as a Put Settlement Amount under the Sovereign Guarantee and not invested in Permitted Investments constituting Other Assets or applied under the Priority of Payments, (II) Repledged Assets, (III) any other cash held in respect of the Required Reserve and (IV) all other amounts standing to the credit of the FSAM Cash Account or other accounts maintained by the Collateral Agent under the Pledge and Administration Agreement), plus

(C) the aggregate FSAM Asset Value of any Posted Collateral held by the Collateral Agent under the Dexia Non-Guaranteed Put Contract, plus

(D) the aggregate of the Collateral Values related to Hedge Agreements, plus

(E) the aggregate of all the FSAM Asset Swap Benefits in relation to Hedge Agreements; plus

(F) the aggregate of the Collateral Sale Excess Amounts determined on or prior to such date, if any.

“ Eligible Dealers ” means JP Morgan Securities Inc., Goldman Sachs & Co., Deutsche Bank Securities, Inc., Morgan Stanley & Co., Bank of America Securities LLC, Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC, and such other dealers as may be reasonably agreed among Party A, the Administrator and FSA from time to time.

Agent hereunder in accordance with the definition of Exposure applicable under the relevant Hedge Agreement (but disregarding any transactions other than such Asset Swap that would otherwise be included in the determination of Exposure thereunder as defined therein), where the Valuation Agent hereunder may rely for this purposes on the determination of Exposure (or the components thereof) by the relevant Third Party Valuation Agent.

“ FSAM Asset Swap Cost ” means in relation to each derivative transaction that is identified as an Asset Swap in the Hedge Agreement Register, the mark to market value of such derivative transaction (if any) in favor of FSAM’s Hedge Counterparty as determined by the Valuation Agent hereunder in accordance with the definition of Exposure applicable under the relevant Hedge Agreement (but disregarding any transactions other than such Asset Swap that would otherwise be included in the determination of Exposure thereunder as defined therein), plus or minus any “unpaid amounts” that are outstanding between the parties, where the Valuation Agent hereunder may rely for this purposes on the determination of Exposure (or the components thereof) by the relevant Third Party Valuation Agent.

“ FSAM Assets Valuation Percentage ” means in relation to each category of FSAM Asset, the valuation percentage corresponding to the current rating of such FSAM Asset as set forth under the heading “Collateral Rating” on Schedule A hereto .

“ FSAM Asset Value ” means in relation to each FSAM Asset or item of Eligible Collateral, on any date of determination, the product of (i) (A) in the case of an FSAM Asset, the Outstanding Principal Amount thereof times the indicative market price (as a percentage of par) of such FSAM Asset determined by the Valuation Agent in accordance with the procedures attached as Schedule C, and (B) in the case of an item of Eligible Collateral, the unpaid principal balance thereof times the indicative market price (as a percentage of par) of such item of Eligible Collateral, determined in accordance with generally applicable procedures used by the Custodian for valuing similar types of assets (each of (A) and (B), the “ Indicative Market Value ”) and (ii) the FSAM Assets Valuation Percentage corresponding to the relevant category of FSAM Asset (or item of Eligible Collateral, as applicable). The FSAM Asset Value with respect to FSAM Assets that are not Put Portfolio Assets, Excluded Assets, Permitted Investments or cash will be zero.

in accordance with the timing set forth in Paragraph 4(b), (3) the parties will consult with each other in an attempt to resolve the dispute and (4) if they fail to resolve the dispute by the Resolution Time, then in relation to each FSAM Asset for which one of the parties has initiated a dispute within the required time, the Valuation Agent shall request bids from at least three Eligible Dealers, one of which shall be identified by the Pledgor, one of which shall be identified by FSA and the remainder of which shall be selected by the Valuation Agent. For any bid to be eligible for use in calculating the FSAM Asset Value (each an “ Eligible Bid ”), it (i) must be received from the Eligible Dealer at or before 1:00 p.m. on the business day following the Resolution Time, and (ii) must be a firm bid at which the Eligible Dealer is ready and willing to purchase assets determined by the Valuation Agent to be comparable, in an amount determined by the Valuation Agent to be representative, at such price (provided, that in obtaining such bid, the Valuation Agent shall not be required to commit to actually deliver and sell the asset to any bidder). On the basis of the Eligible Bids received the Valuation Agent shall determine the FSAM Asset Value as follows:

(i) In the event that the Valuation Agent receives any Eligible Bid that is equal to or greater than the Indicative Market Value for any FSAM Asset, the Indicative Market Value determination for such FSAM Asset shall prevail without consideration of any other Eligible Bid; or

(ii) If the Valuation Agent does not receive any Eligible Bid that is equal to or greater than the Indicative Market Value for any FSAM Asset, then:

(a) if the Valuation Agent receives three or more Eligible Bids, the Valuation Agent shall calculate the arithmetic mean of the three lowest Eligible Bids received (the “ Bid Average ”), and if such Bid Average is more than 105% or less than 95% of the Indicative Market Value, the Valuation Agent shall adjust the determination of the FSAM Asset Value so as to be within the range that is not more than 105% or less than 95% of the Indicative Market Value (but by no more than the amount necessary to be within such range), which adjusted FSAM Asset Value shall be binding; or

(b) if the Valuation Agent receives only two Eligible Bids, the Valuation Agent shall use the Indicative Market Value as one of the three bids used to calculate the Bid Average, and the Valuation Agent shall determine FSAM Asset Value in accordance with sub-clause (a) above; or

(c) in the event that fewer than two Eligible Bids are received, the Indicative Market Value determination shall prevail without consideration of any Eligible Bid.

“ FSAM Exposure ” means in relation to each Hedge Agreement the aggregate Exposure (if any) of FSAM to the relevant Hedge Counterparty determined by the Valuation Agent in accordance with the definition of Exposure applicable under the relevant Hedge Agreement (where the Valuation Agent may rely for this purposes on the determination of Exposure by the valuation agent or calculation agent under such Hedge Agreement). For the avoidance of doubt, the determination of FSAM Exposure shall not be reduced by any Threshold applicable to collateral postings under the relevant Hedge Agreement.

“ FSAM Liability Swap Benefit ” means in relation to each derivative transaction that would be identified as a Liability Swap in the Hedge Agreement Register, the mark to market value of such derivative transaction (if any) in favor of FSAM that would be determined by the Valuation Agent in accordance with the definition of Exposure applicable under any Hedge Agreement selected by the Administrator (but disregarding any transactions other than such transaction that would otherwise be included in such determination of Exposure); or if such derivative transaction would not be documented under an ISDA Master Agreement, the current market value of such transaction in the relevant futures market or similar market as reasonably estimated by the Administrator.

“ FSAM Liability Swap Cost ” means in relation to each derivative transaction that is identified as a Liability Swap in the Hedge Agreement Register, the mark to market value of such derivative transaction (if any) in favor of FSAM’s Hedge Counterparty as determined by the Valuation Agent hereunder in accordance with the definition of Exposure applicable under the relevant Hedge Agreement (but disregarding any transactions other than such Liability Swap that would otherwise be included in such determination of Exposure), plus or minus any “unpaid amounts” that are outstanding between the parties, where the Valuation Agent hereunder may rely for this purposes on the determination of Exposure (or the components thereof) by the relevant Third Party Valuation Agent.

“ GIC Business Costs Amount ” means on any date of determination the amount applicable under the terms set forth in Schedule B in relation to such date, as most recently determined by the Calculation Agent.

“ GIC Redemption Balance ” means the outstanding principal balance of a GIC or, if a GIC accretes a redemption value based on a fixed series of payments, such accreted redemption value, provided, however that any component of such redemption value that is attributable to a makewhole or prepayment premium payable upon redemption of the relevant GIC in respect of changes in interest rates shall be excluded in determining such redemption value.

“ GIC Termination Liquidity Draw ” means a Liquidity Draw Request for the purpose of paying, or reserving funds for payment of, the maximum amount potentially payable under one or more GICs due to mandatory terminations, or terminations at the option of the GIC Holder under the GIC Contracts, as a result of a GIC Credit Event (as defined in the Liquidity Facility or Repurchase Agreeement Facility, as applicable) which has made one or more GIC Termination Downgrade Provisions become applicable under the relevant GIC Contracts.

“ GIC Termination Downgrade Provision ” means a provision that requires (i) the termination and repayment of a GIC Contract either automatically, or assuming notice from the relevant GIC Holder electing such termination and repayment (notwithstanding any posting of collateral) and (ii) becomes applicable upon a specified downgrade of the rating of FSA’s financial strength .

“ Lien ” means, with respect to any asset, any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in, on or of such asset.

“ Lien Creditor Amount ” means, as of any date, an amount equal to the sum of (x) the amount of any judgment, tax claim or claim under the Employee Retirement Income

Security Act of 1974 or equivalent laws under non-U.S. jurisdictions (including any interest and/or penalties on any such amounts) which is secured by a Lien on any Posted Collateral or FSAM Assets, plus (y) an amount equal to the aggregate amount of obligations (including any interest on such obligations accrued up to and including such date) which are secured by a Lien on any Posted Collateral or by FSAM Assets (other than the Lien of the Collateral Agent or any Secured Party under the Pledge and Administration Agreement as contemplated by the terms of such Agreement) which has not been discharged and with respect to which Party A has received 30 days’ prior notice from Party B of the existence of such Lien.

“ Liquidation ” means either (i) the sale for cash of Eligible Collateral or (ii) the termination of a Temporary Funding Transaction in relation to Eligible Collateral on terms whereby the repurchase agreement buyer retains such Eligible Collateral and the repurchase agreement seller retains the Liquidation Proceeds.

“ Liquidation Proceeds ” means the cash sale proceeds from a sale of Eligible Collateral or the cash proceeds of the financing obtained in connection with such Temporary Funding Transaction.

“ Liquidity Draw Request ” has the meaning specified in the Pledge and Administration Agreement.

“ Liquidity Offset Fraction ” means in the case of a Liquidity Draw Offset, the fraction obtained by dividing (i) the amount of the Liquidity Draw Offset by (ii) the full Liquidation Proceeds of any sale or cash amount of the relevant Temporary Financing Transaction.

“ Local Business Day ” means any day on which (A) commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) in New York and the location of Party A, Party B and any Custodian, and (B) in relation to a Transfer of Eligible Collateral, any day on which the clearance system agreed between the parties for the delivery of Eligible Collateral is open for acceptance and execution of settlement instructions (or in the case of a Transfer of Cash or other Eligible Collateral for which delivery is contemplated by other means a day on which commercial banks are open for business (including dealings in foreign exchange and foreign deposits) in New York and the location of Party A, Party B and any Custodian).

“ Principal Forgiveness Amount ” means an amount equal to the aggregate of all amounts of principal forgiven by the holders of any Put Portfolio Assets, Excluded Assets or Other Assets pursuant to amendments to the Underlying Instruments which result in a reduction of the Outstanding Principal Amount of the related Put Portfolio Assets, Excluded Assets or Other Assets (except to the extent that either (A) such amount of principal forgiven has been separately paid by Party A to Party B as a Writedown Amount under this Agreement or (B) a Put Settlement Date has occurred and the Put Settlement Amounts in relation thereto have already been paid in relation to the relevant Put Portfolio Assets, Excluded Assets or Other Assets prior to the relevant forgiveness of principal).

Third Party Hedge Agreement (including by satisfying such requirements through the credit support annex for the Dexia Affiliate guaranteeing such Third Party Hedge Agreement) as of such date. For the avoidance of doubt, collateral posted by Dexia or its Affiliates in relation to any Hedge Agreement that is treated as a Qualifying Hedge Agreement shall be deemed not to constitute a Put Portfolio Asset, Excluded Asset or Other Asset, or to have any FSAM Asset Value for purposes of the determination of Exposure hereunder, whether or not the relevant Hedge Counterparty treats Party B as the pledgor or beneficial owner of such collateral for purposes of the relevant Hedge Agreement.

“ Qualifying Liquidity Payment ” means (i) if any undrawn or unutilized commitments remaining outstanding with respect to the Guaranteed Liquidity Facilities and such Guaranteed Liquidity Facilities have not been terminated, a payment with respect to a Liquidity Draw Request and (ii) if no undrawn or unutilized commitments remain outstanding under the Guaranteed Liquidity Facilities or such Guaranteed Liquidity Facilities have been terminated, a payment of principal or redemption amount in relation to an FSA GIC Contract that if not otherwise paid would be required to be paid by Party A as an “Obligation” under the Dexia FP Guarantee.

“ Subordinated Hedge Agreement ” means each Third Party Hedge Agreement in relation to which Party A, FSAM and the relevant Hedge Counterparty have entered into an amendment substantially in the form set forth in Schedule D, provided that Party A, Party B and FSA acknowledge and agree that variations in the terms of individual amendments based on such form either (i) that do not impair in any material respect the direct or indirect benefits to Party B and FSA of the amendment contemplated by such form or (ii) to which FSA has given its consent not to be unreasonably withheld or delayed, shall not prevent a Third Party Hedge Agreement from qualifying as a Subordinated Hedge Agreement.

“ Third Party Valuation Agent ” means the “Valuation Agent” as defined in a Hedge Agreement.

Other terms . Capitalized terms used and not defined herein have the meanings set forth in the Pledge and Administration Agreement or the Confirmation to this Agreement.

(v) Rating Agency Revisions . Notwithstanding the provisions for the calculation of Exposure and Value set forth above, if each of Moody’s Investors Service, Standard and Poor’s Rating Services and Fitch Ratings Inc. (the “ Rating Agencies ”) confirm that the GIC Issuers’ obligations in relation to the FSA GIC Contracts will continue to be rated at least “Aa2/AA/AA” (without giving effect to the Retained FSA Policies other than Secondary Policies) with a lesser Exposure being collateralized by Party A or different FSAM Assets Valuation Percentage being applicable, then the calculation of Exposure or FSAM Asset Value described above shall be revised accordingly pursuant to Section 9(b) of this Agreement, and when such amendment is effective Party A may post such lesser Credit Support Amount as results from such amendment and/or receive a Return Amount of any resulting excess Credit Support Amount (any such change a “ Required Collateral Reduction ”); provided, further, that no Return Amount shall apply unless, prior to any Transfer of such Return Amount, each Rating Agency confirms that the credit rating assigned to the financial strength of FSA would not be downgraded or withdrawn as a result of such Transfer. Any rating issued in accordance with the preceding sentence must be a monitored rating (with the related costs and expenses being borne by Party A).

If after being obtained any rating of the GIC Issuers is subsequently downgraded below “Aa3” by Moody’s or “AA-” by S&P or Fitch or withdrawn, the definitions of Exposure and FSAM Assets Valuation Percentage will be reinstated to require the Credit Support Amount initially set forth herein prior to any Required Collateral Reductions, and Party A shall be required to Transfer Eligible Collateral to the extent of any resulting increase in the Credit Support Amount resulting from such reinstatement within five Business Days of receiving notice of such downgrade. Provided Party A satisfies such Transfer obligations, the FSAM Assets Valuation Percentage shall thereafter be amended as necessary in consultation with the Rating Agencies such that the rating of the GIC Issuers will be at least “Aa3” by Moody’s, “AA-” by S&P and “AA-” by Fitch, provided that in no event shall the definitions of Exposure and FSAM Assets Valuation Percentage be reinstated to require a higher Credit Support Amount than initially set forth herein prior to any Required Collateral Reductions.

(m) Remedies, Waiver.

(i) In addition to the rights and remedies of the Secured Party or its designee under Paragraph 8(a), and subject in each case to the provisions of Section 5.3 of the Pledge and Administration Agreement, the Pledgor agrees that if at any time (1) an Event of Default with respect to the Pledgor has occurred and is continuing and FSA has become the Secured Party Representative, or (2) an Early Termination Date has occurred or been designated as the result of an Event of Default with respect to the Pledgor, then, unless the Pledgor has paid in full all of its Obligations that are then due, the Collateral Agent (as assignee of the Secured Party and at the direction of the Secured Party Representative) may exercise any of its rights or remedies afforded under any agreement, by law, at equity or otherwise, including the rights and remedies of a secured party under the Uniform Commercial Code as in effect in any applicable jurisdiction, or under other applicable law, without further notice, demand or presentment. Such rights and remedies include the rights to use self-help or other remedies, including without limitation (i) taking possession of any Posted Collateral, wherever situate; (ii) entering any premises or obtain sole control of any account where Posted Collateral is located; and (iii) selling or otherwise disposing of any Posted Collateral “as is” without representation or warranty of any kind, at public or private sale, with such notice as may be required by applicable law, in lots or in bulk, at such locations, all as the Collateral Agent (as assignee of the Secured Party and at the direction of the Secured Party Representative), in its sole discretion, deems advisable. The Collateral Agent (as assignee of the Secured Party and at the direction of the Secured Party Representative) shall have the right to sell, lease or otherwise dispose of any Posted Collateral for cash, credit or any combination thereof, and the Collateral Agent (as assignee of the Secured Party and at the direction of the Secured Party Representative) may purchase any Posted Collateral at public or, if permitted by law, private sale and, in lieu of actual payment of the purchase price, may set off the amount of such price against the Obligations. The rights and remedies of the Collateral Agent are cumulative, may be exercised at any time and from time to time, concurrently or in any order, and are not exclusive of any other rights or remedies available by agreement, by law, at equity or otherwise.

(ii) Paragraph 8(b) shall not apply.

IN WITNESS WHEREOF, the parties have executed this Annex by their duly authorized representatives as of the date of the Agreement.

DEXIA CRÉDIT LOCAL S.A.		FSA ASSET MANAGEMENT LLC


By:		By:
	Name:		Name:
	Title:		Title:

By:
	Name:
	Title:


DEXIA SA


By:
Title:


By:
Title:

Schedule A – Categories and Valuation Percentages

VALUATION PERCENTAGE AS % OF MARK TO				COLLATERAL RATING
MARKET VALUE				AAA		AA		A	BBB	BIG
(“CSA” = CSA Eligible)
Government			Maturity
CSA	USA (issued after July 18, 1984)	Bills / Notes/ Bonds /Inflation indexes	0 to 5	98	%
CSA	USA (issued after July 18, 1984)	Bills / Notes/ Bonds /Inflation indexes	>5 to 10	97	%
CSA	USA (issued after July 18, 1984)	Bills / Notes/ Bonds /Inflation indexes	>10	93	%
	USA (issued after July 18, 1984)	Zero Coupons / STRIPS	0 to 5	98	%
	USA (issued after July 18, 1984)	Zero Coupons / STRIPS	>5 to 10	95	%	95	%
	USA (issued after July 18, 1984)	Zero Coupons / STRIPS	>10	90	%	90	%
CSA	FRANCE/ BELGIUM/ GERMANY / UK / NETHERLANDS	USD Denominated	0 to 5	97	%	97	%
CSA	FRANCE/ BELGIUM/ GERMANY / UK / NETHERLANDS	USD Denominated	>5 to 10	95	%	95	%
CSA	FRANCE/ BELGIUM/ GERMANY / UK / NETHERLANDS	USD Denominated	>10	90	%	90	%
CSA	FRANCE/ BELGIUM/ GERMANY / UK / NETHERLANDS	Local Currency	0 to 5	92	%	92	%
CSA	FRANCE/ BELGIUM/ GERMANY / UK / NETHERLANDS	Local Currency	>5 to 10	90	%	90	%

VALUATION PERCENTAGE AS % OF MARK TO				COLLATERAL RATING
MARKET VALUE				AAA		AA		A		BBB		BIG
CSA	FRANCE/ BELGIUM/ GERMANY / UK / NETHERLANDS	Local Currency	>10	85	%	85	%
Government Agency
CSA	US Agency	GNMA	0 to 5	92	%
CSA		GNMA	>5 to 10	90	%
CSA		GNMA	>10	85	%
CSA		FDIC	0 to 5	92	%
CSA		FNM RMBS /FHM RMBS	ALL	82	%

	Municipal			75	%	70	%	60	%	50	%	0
	Military Housing			60	%	50	%	40	%	30	%	0

UK Regulated Utility				70	%	60	%	50	%	40	%	0
Trust Preferreds				25	%	5	%	5	%	5	%	0

SF	Non-Agency RMBS
		Prime Mtg		25	%	20	%	5	%	5	%	0
		Alt-A Front		10	%	5	%	5	%	5	%	0
		Alt-A LCF		10	%	5	%	5	%	5	%	0
		Alt-A Mezz		10	%	5	%	5	%	5	%	0
		Alt-A Mid		10	%	5	%	5	%	5	%	0
		Alt-A Pass Thru		10	%	5	%	5	%	5	%	0
		Subprime Auto		10	%	5	%	5	%	5	%	0
		Subprime Front		10	%	5	%	5	%	5	%	0
		Subprime LCF		10	%	5	%	5	%	5	%	0
		Subprime Mezz		10	%	5	%	5	%	5	%	0
		Subprime Mid		10	%	5	%	5	%	5	%	0
		Subprime Pass Thru		10	%	5	%	5	%	5	%	0

VALUATION PERCENTAGE AS % OF MARK TO			COLLATERAL RATING
MARKET VALUE			AAA		AA		A		BBB		BIG
		Option ARM Front	10	%	5	%	5	%	5	%	0
		Option ARM Mid	10	%	5	%	5	%	5	%	0
		Option ARM Pass Thru	10	%	5	%	5	%	5	%	0
		HELOCs	10	%	5	%	5	%	5	%	0
		CES	10	%	5	%	5	%	5	%	0
	ABS CDO		10	%	5	%	5	%	5	%	0
	CLO		10	%	5	%	5	%	5	%	0
CMBS/CRE
	CMBS		60	%	50	%	40	%	30	%	0
Other
	Demutualization		10	%	5	%	5	%	5	%	0
	FSA Refi		10	%	5	%	5	%	5	%	0
	Other NIM		10	%	5	%	5	%	5	%	0
	Radian NIM		10	%	5	%	5	%	5	%	0
	Triple-X		10	%	5	%	5	%	5	%	0
	Domestic IOU		10	%	5	%	5	%	5	%	0
	Westlake Funding (Auto)		60	%	55	%	50	%	40	%	0

Schedule B — Calculation of GIC Business Costs Amount

The Calculation Agent shall, within five (5) Business Days after the last day of each calendar month (each such last day of a calendar month, a “Monthly Valuation Date), calculate the “GIC Business Costs Amount” as of such Monthly Valuation Date. The GIC Business Costs Amount for each Monthly Valuation Date shall be the sum of the “Expenses Component” and the “Spread Component”, each calculated in accordance with this Schedule B.

I. Expenses Component

1. The Expenses Component for any Monthly Valuation Date shall be the amount set forth in the table below (as amended from time to time in accordance with paragraphs I.2, and plus or minus any items identified pursuant to paragraph I.3 below, the “Expenses Component Table”) for the relevant year of determination in which such Monthly Valuation Date falls:

Year		Expenses Component ($ mm)
2009		249.4
2010		230.7
2011		222.1
2012		213.7
2013		205.7
2014		197.9
2015		190.3
2016		182.8
2017		175.2
2018		167.6
2019		160.0
2020		152.4
2021		147.1
2022		141.8
2023		136.5
2024		131.2
2025		125.8
2026		120.5
2027		115.1
2028		109.7
2029		104.3
2030		98.9
2031		93.5
2032		88.1
2033		82.7
2034		77.3
2035		71.8
2036		66.3
2037		60.9
2038		55.4
2039		49.9
2040		44.4
2041		38.9
2042		33.4
2043		27.8
2044		22.3
2045		16.7
2046		11.2
2047		5.6

2. If for any projected year (i) the Fixed Maturity GICs and Other GICs (which are limited, for the avoidance of doubt, to FSA GIC Contracts) are scheduled to have matured, and (ii) the Modeled Balances referred to in paragraph II.2(a) below show an expected GIC Balance of zero for all Structured GICs (which are limited, for the avoidance of doubt, to FSA GIC Contracts) (such projected year, a “Zero Year”), within two Local Business Days of determining that a Zero Year exists, the Calculation Agent shall:

(a) revise the table of Budgeted Expenses to reflect a value of zero for each year following the Zero Year, through 2047. The initial table of “Budgeted Expenses” is set forth on Exhibit A to this Schedule B, as such Exhibit may be amended from time to time pursuant to this paragraph I.2(a), or pursuant to paragraph I.3 below; and

(b) prepare a revised Expenses Component Table for each year through the Zero Year, and enter a value of zero for each year after the Zero Year. The revised Expenses Component Table shall be a calculation of the present value of the Budgeted Expenses as amended from time to time pursuant to paragraph I.2(a), or pursuant to paragraph I.3 below, and assuming inflation at 3% per annum, and a discount rate of 2.8% per annum. The Calculation Agent shall provide a draft of the revised Expenses Component Table, together with reasonable evidence to support its calculations, to Party A and FSA. In the absence of manifest error or written dispute by Party A or FSA within ten Local Business Days of receipt, such revised Expenses Component Table shall be binding on the parties, and the Calculation Agent shall provide written notice thereof to the Valuation Agent.

3. (a) If in any year the Administrator incurs one or more expenses (“Unanticipated Recurring Expenses”) or realizes one or more savings (“Unanticipated Recurring Savings”) which (i) in good faith, the Board of Directors of the Administrator has identified as being a net cash additional expense or saving, as applicable, that in their estimation is expected to recur annually while any FSA GIC Contract is outstanding and therefore justifies a permanent alteration of the budget for the Administrator, (ii) has been discussed with FSA and, prior to a Dexia Event of Default, the Dexia Guarantors, and reasonable supporting documentation has been submitted demonstrating both the expense or saving, as applicable, and the reasons for the Board of Directors’ belief that such expense or saving, as applicable, will recur annually and therefore justifies a permanent alteration of the budget for the Administrator, and following a Dexia Event of Default, FSA consents to the proposed alteration of the Budgeted Expenses, and (iii) together with all other actual expenses incurred or savings realized the resulting overall actual expenses of the Administrator during such year exceed or are less than, as applicable, the Budgeted Expenses specified in Exhibit A to this Schedule B for that year (as adjusted pursuant to paragraph I.2(a), or this paragraph I.3 on any prior occasion) by more than 25%, the Budgeted Expenses amount for each following year will be deemed increased (or decreased, as applicable) by the amount of such Unanticipated Recurring Expense or Unanticipated Recurring Saving. In the case of this subparagraph (a), the designation of one or more such expenses or savings as Unanticipated Recurring Expenses or Unanticipated Recurring Savings shall be made as of the end of the applicable year in which such expenses are incurred or savings are realized.

(b) In addition to (a) above, if the Administrator shall during the course of any year revise the budget of the Administrator in accordance with Section 7(a) of the Administrative Services Agreement and (i) in good faith, the Board of Directors of the Administrator has identified a net cash additional expense that in their estimation is expected to recur annually while any FSA GIC Contract is outstanding and therefore justifies a permanent

alteration of the budget for the Administrator, (ii) has been discussed with FSA and, prior to a Dexia Event of Default, the Dexia Guarantors, and reasonable supporting documentation has been submitted demonstrating the expense, and the reasons for the Board of Directors’ belief that such expense will recur annually and therefore justifies a permanent alteration of the budget for the Administrator, and following a Dexia Event of Default, FSA consents to the proposed alteration of the Budgeted Expenses, and (iii) together with all other actual expenses incurred, expected to be incurred based on other Budgeted Expenses (or expected to be incurred as Unanticipated Recurring Expenses and adjusted by projected Unanticipated Recurring Savings, if any, for that year) the resulting known and projected overall actual expenses of the Administrator during such year exceed the Budgeted Expenses specified in Exhibit A to this Schedule B for that year (as adjusted pursuant to paragraph I.2(a), or this paragraph I.3 on any prior occasion) by more than 25%, the Budgeted Expenses amount for the current year and each following year will be deemed increased by the amount of such Unanticipated Recurring Expense.

(c) In the case of (a) or (b), the Calculation Agent shall prepare a present value calculation of such Unanticipated Recurring Expense or Unanticipated Recurring Saving, assuming inflation at 3% per annum, and a discount rate of 2.8% per annum. The Calculation Agent shall provide a draft of this calculation, together with reasonable evidence to support its calculations, to Party A and FSA. In the absence of manifest error or written dispute by Party A or FSA within ten Local Business Days of receipt, such calculation shall be binding on the parties, and the Calculation Agent shall provide written notice thereof to the Valuation Agent. The resulting amounts shall be added to, or subtracted from, the amounts in the Expenses Component Table for all purposes going forward from the time such calculation is agreed or deemed applicable.

II Spread Component

To calculate the Spread Component for any Monthly Valuation Date, the Calculation Agent shall:

1. Identify and categorize, using the designation on Annex 4 to the Confirmation to this Agreement, each FSA GIC Contract then outstanding as either:

(a) a “Fixed Maturity GIC”, if such GIC is designated on such Annex 4 as being a Debt Service Reserve Fund GIC and while the beneficiary of such GIC is rated at least A- or A3 (and if such beneficiary is at any time not so rated, such GIC shall be an “Other GIC” for purposes hereof);

(b) a “Structured GIC”, if such GIC is designated on such Annex 4 as being an ABS CDO GIC or CDO/CLO GIC ; or

(c) an “Other GIC” if such GIC has any other designation, or no designation, on such Annex 4, or at any time fails to qualify as a Fixed Maturity GIC because of the rating (or lack thereof) of the related beneficiary of such GIC.

2. For each Fixed Maturity GIC, determine a “Permitted Investment Spread” as follows:

(a) calculate the remaining weighted average life of such Fixed Maturity GIC as of such Monthly Valuation Date, assuming no unscheduled draws thereunder are made after such Monthly Valuation Date;

(b) map such Fixed Maturity GIC into the appropriate “WAL Bucket” as set forth in the table below:

GIC WAL:

<3 mo

3 mo – 1 yr

1 – 2 yrs

2 – 3 yrs

3 – 5 yrs

5 – 7 yrs

7 – 10 yrs

10 – 30 yrs

30 yrs +

WAL Bucket:

1 mo

3 mo

1 yr

2 yr

3 yr

5 yr

7 yr

10 yr

30 yr

(c) identify each type of Permitted Investment from the table below that corresponds with the WAL Bucket for such Fixed Maturity GIC (e.g., if the WAL Bucket for a Fixed Maturity GIC is determined to be 2 years, then the USSP2 Index and the C5342Y Index will be Permitted Investments for such GIC):

Name	Description	Bloomberg instruction
1-Month LIBOR T-Bill Spread	1 month Treasury Bill spread to 1 month swap	USGG1M Index <go> - US0001m Index <go>

3-Month LIBOR T-Bill Spread	3 month Treasury Bill spread to 3 month swap	USGG3M Index <go> - US0003m Index <go>

USSP1 Index	1 yr Treasury spread to swap	USSP1 Index <go>

USSP2 Index	2 yr Treasury spread to swap	USSP2 Index <go>

USSP3 Index	3 yr Treasury spread to swap	USSP3 Index <go>

USSP5 Index	5 yr Treasury spread to swap	USSP5 Index <go>

USSP7 Index	7 yr Treasury spread to swap	USSP7 Index <go>

USSP10 Index	10 yr Treasury spread to swap	USSP10 Index <go>

USSP30 Index	30 yr Treasury spread to swap	USSP30 Index <go>

NOASFGLM Index	Freddie Mortgage Current Coupon OAS (for all 5,7 and 10 yr buckets)	NOASFGLM Index <go>

NOASFNCL Index	FNMA Mortgage Current Coupon OAS (for all 5,7 and 10 yr buckets)	NOASFNCL Index <go>

NOASGNSF Index	GNMA Mortgage Current Coupon OAS (for all 5,7 and 10 yr buckets)	NOASGNSF Index <go>

C5342Y Index	US FDIC Temporary Liquidity Guarantee 2 yr	C5342Y Index <go> - USSWAP2 index <go>

C5343Y Index	US FDIC Temporary Liquidity Guarantee 3 yr	C5343Y Index <go> - USSWAP3 index <go>

(d) for each such type of Permitted Investment identified pursuant to subparagraph (c) above, determine, using Bloomberg as the data source, the swap spread relating thereto as of the close of business in the principal markets in the United States relating thereto on each of the 90 consecutive calendar days ending on such Monthly Valuation Date (it being understood that the swap spread as of the close of business on a day that is not a Business Day shall be deemed to be the swap spread in effect as of the close of business on the last day prior thereto that was a Business Day), and, based thereon, the average such swap spread over such period for each such type of Permitted Investment (for each such type of Permitted Investment, the “Average Swap Spread”); and

(e) the “Permitted Investment Spread” for such Fixed Maturity GIC shall be deemed to be the highest positive Average Swap Spread determined in relation to such GIC pursuant to subparagraph (d) above or, if the determination performed pursuant to such subparagraph (d) does not yield any positive Average Swap Spread, the “Permitted Investment Spread” for such Fixed Maturity GIC shall be deemed to be the least negative Average Swap Spread determined in relation to such GIC pursuant to subparagraph (d) above.

3. For each Structured GIC and Other GIC, the “Permitted Investment Spread” shall be deemed to be negative 100 basis points per annum.

4. For each FSA GIC Contract, determine a “GIC Spread” for each Monthly Valuation Date, which shall be equal to the Permitted Investment Spread for such FSA GIC Contract for such Monthly Date pursuant to paragraph 2 or paragraph 3 above, as applicable, increased by the absolute value of any negative funding spread to LIBOR applicable to such FSA GIC Contract as of such Monthly Valuation Date or decreased by the value of any positive funding spread to LIBOR applicable to such FSA GIC Contract as of such Monthly Valuation Date. For example, if the Permitted Investment Spread applicable to a Fixed Maturity GIC on a Monthly Valuation Date were determined to be negative 60 basis points per annum and the funding spread to LIBOR applicable to such FSA GIC Contract as of such Monthly Valuation Date were negative 20 basis points per annum, the “GIC Spread” for such FSA GIC Contract for such Monthly Valuation Date would equal negative 40 basis points per annum (i.e., such Permitted Investment Spread of negative 60 basis points per annum “increased” by the absolute value of such negative funding spread of 20 basis points per annum).

5. For each Structured GIC for any Monthly Valuation Date, calculate an “Adjusted Modeled Balance” to be applicable thereto for such Monthly Valuation Date by dividing the actual balance of such Structured GIC on such Monthly Valuation Date by its Modeled Balance for such Monthly Valuation Date, to produce an “Adjustment Factor”, and then multiplying its Modeled Balance for such Monthly Valuation Date and all future Monthly Valuation Dates by such Adjustment Factor to derive an “Adjusted Modeled Balance”.

6. For each Other GIC for any Monthly Valuation Date, if so advised by Dexia that it wishes in its reasonable judgment (and irrespective of actual draw experience) to revise the expected draw schedule set forth on Exhibit C to this Schedule B for such Monthly Valuation Date and all future Monthly Valuation Dates (unless and until adjusted again pursuant to this paragraph 6), make such revisions (as revised, the “Expected Draw Schedule”).

7. For each Fixed Maturity GIC for each Monthly Valuation Date, the “Spread Component” applicable thereto shall equal the sum of the present values, based on the then current swap curve (as derived from market data reported by recognized pricing information service providers and using recognized systems-based curve-building models), of a series of projected payments on each scheduled interest payment date for the relevant Fixed Maturity GIC each equal to (i) the projected outstanding principal balance of such FSA GIC Contract (assuming no unscheduled draws under such FSA GIC Contract) during the period ending on (but excluding) such scheduled interest payment date times (ii) the applicable GIC Spread for such FSA GIC Contract for such Monthly Valuation Date determined as provided above (it being understood that such Spread Component will be negative if the applicable GIC Spread is positive) times (iii) the day count fraction applicable to payments of interest under the relevant Fixed Maturity GIC. If a Fixed Maturity GIC does not pay current interest it will be deemed to have interest payment dates, and other payment terms, the same as those under the related swap, and accretion to the projected outstanding principal balance will be disregarded for purposes of this calculation.

8. For each Structured GIC for each Monthly Valuation Date, the “Spread Component” applicable thereto shall equal the sum of the present values, based on the then current swap curve (as derived from market data reported by recognized pricing information service providers and using recognized systems-based curve-building models), of a series of projected payments on each scheduled interest payment date for the relevant Structured GIC each equal to (i) the projected Modeled Balance or Adjusted Modeled Balance, as applicable of such FSA GIC Contract during the period ending on (but excluding) such scheduled interest payment date times (ii) the applicable GIC Spread for such FSA GIC Contract for such Monthly Valuation Date determined as provided above (it being understood that such Spread Component will be negative if the applicable GIC Spread is positive) times (iii) the day count fraction applicable to payments of interest under the relevant Structured GIC.

9. For each Other GIC for each Monthly Valuation Date, the “Spread Component” applicable thereto shall equal the sum of the present values, based on the then current swap curve (as derived from market data reported by recognized pricing information service providers and using recognized systems-based curve-building models), of a series of projected payments on each scheduled interest payment date for the relevant Other GIC each equal to (i) the projected outstanding principal balance of such FSA GIC Contract, based on its Expected Draw Schedule as of such Monthly Valuation Date, during the period ending on (but excluding) such scheduled interest payment date times (ii) the applicable GIC Spread for such FSA GIC Contract for such Monthly Valuation Date determined as provided above (it being understood that such Spread Component will be negative if the applicable GIC Spread is positive) times (iii) the day count fraction applicable to payments of interest under the relevant Other GIC. If an Other GIC does not pay current interest it will be deemed to have interest payment dates, and other payment terms, the same as those under the related swap, and accretion to the projected outstanding principal balance will be disregarded for purposes of this calculation.

10. The “Spread Component” hereunder for any Monthly Valuation Date shall equal the sum of the “Spread Components” determined for each Fixed Maturity GIC, Structured GIC and Other GIC for such Monthly Valuation Date pursuant to paragraph 7, 8 or 9 above, as applicable.

The Calculation Agent shall provide to Party A, Party B and FSA a copy of its calculation of the GIC Business Costs Amount, as of each Monthly Valuation Date, together with reasonable information demonstrating the calculations referenced in this Schedule B.

III Annual Adjustment

1. Dexia and FSA have agreed that during July of each year, beginning 2010, they will conduct an annual re-evaluation of the reasonableness of the Modeled Balance for each Structured GIC.

2. Each June 30 th , beginning 2010, the Calculation Agent shall collect the Adjustment Factors, calculated under paragraph II.5 above, for all Monthly Valuation Dates from and including the prior July through and including such June (or, in the case of the first adjustment pursuant to this Section III, from an including the first Monthly Valuation Date through and including the June, 2010 Monthly Valuation Date).

3. The Calculation Agent shall, no later than July 5 th of each year, beginning 2010, calculate and report to Dexia and FSA, the weighted average Adjustment Factor for the Structured GICs for the abovementioned range (weighted based on the outstanding principal amount of such Structured GICs as at the date the related Adjustment Factor was determined).

4. If such weighted average Adjustment Factor is greater than or equal to 0.95 and less than or equal to 1.05, the Modeled Balances shall remain unchanged.

5. If such weighted average Adjustment Factor is less than 0.95 or greater than 1.05:

(a) Dexia and FSA shall revisit the Amortization Assumptions attached as Exhibit D to this Schedule B, and negotiate in good faith to agree a revised set of Amortization Assumptions and the related Modeled Balances for the Structured GICs, or agree that the current Amortization Assumptions and the related Modeled Balances for the Structured GICs should remain in place.

(b) If Dexia and FSA do not agree on the matters set forth in (a) above by July 31 st of such year, then Dexia will select an investment bank or asset manager (the “Advisor”) that is not an Affiliate of either Dexia or FSA, to validate the existing set of Amortization Assumptions or specify a new set of Amortization Assumptions as such Advisor’s best estimate of the projected amortization experience of the Structured GICs. The Advisor’s determination of the Amortization Assumptions will be binding on both parties and will be used to produce new Modeled Balances for the Structured GICs until the next June 30 th . FSA and Dexia will share equally the costs of the Advisor retained in connection with this Section III, and FSA’s share of such costs will not be indemnifiable or reimbursable to FSA by Party B or Dexia.

6. Upon agreement by Dexia and FSA as to revised Amortization Assumptions and Modeled Balances pursuant to paragraph III.5(a), or upon the determination of the Advisor as to revised Amortization Assumptions and Modeled Balance pursuant to paragraph III.5(b), the Modeled Balances in Exhibit B to this Schedule B and the Amortization Assumptions in Exhibit D to this Schedule B shall be deemed deleted and replace by such revised versions thereof.

Exhibit A to Schedule B — Initial Budgeted Expenses

Year		Amount (in millions of USD)
2009		23
2010		32
2011		29
2012		27
2013		26
2014		26
2015		21
2016		20
2017		20
2018		18
2019		18
2020		18
2021		18
2022		18
2023		18
2024		18
2025		18
2026		19
2027		19
2028		19
2029		20
2030		20
2031		20
2032		21
2033		21
2034		22
2035		22
2036		23
2037		23
2038		24
2039		25
2040		25
2041		26
2042		27
2043		27
2044		28
2045		29
2046		30
2047		30

Exhibit B to Schedule B — Modeled Balances for Structured GIC

Date		Balance (in millions of USD)
6/25/2009		5,522
6/30/2009		5,000
7/31/2009		4,734
8/31/2009		4,351
9/30/2009		3,706
10/31/2009		3,706
11/30/2009		3,699
12/31/2009		2,971
1/31/2010		2,971
2/28/2010		2,971
3/31/2010		2,483
4/30/2010		2,483
5/31/2010		2,483
6/30/2010		2,449
7/31/2010		2,449
8/31/2010		2,429
9/30/2010		2,252
10/31/2010		2,252
11/30/2010		2,252
12/31/2010		2,182
1/31/2011		2,053
2/28/2011		2,053
3/31/2011		2,017
4/30/2011		2,017
5/31/2011		2,017
6/30/2011		2,001
7/31/2011		2,001
8/31/2011		2,001
9/30/2011		1,986
10/31/2011		1,986
11/30/2011		1,986
12/31/2011		1,941
1/31/2012		1,879
2/28/2012		1,879
3/31/2012		1,819
4/30/2012		1,807
5/31/2012		1,807
6/30/2012		1,528

Date		Balance (in millions of USD)
7/31/2012		1,391
8/31/2012		1,391
9/30/2012		1,315
10/31/2012		1,312
11/30/2012		1,312
12/31/2012		1,305
1/31/2013		1,305
2/28/2013		1,305
3/31/2013		1,288
4/30/2013		1,248
5/31/2013		1,206
6/30/2013		1,204
7/31/2013		1,203
8/31/2013		1,203
9/30/2013		987
10/31/2013		987
11/30/2013		987
12/31/2013		985
1/31/2014		640
2/28/2014		640
3/31/2014		638
4/30/2014		638
5/31/2014		608
6/30/2014		586
7/31/2014		586
8/31/2014		586
9/30/2014		536
10/31/2014		536
11/30/2014		536
12/31/2014		505
1/31/2015		505
2/28/2015		505
3/31/2015		504
4/30/2015		502
5/31/2015		502
6/30/2015		501
7/31/2015		501
8/31/2015		421
9/30/2015		413
10/31/2015		372

Date		Balance (in millions of USD)
11/30/2015		372
12/31/2015		370
1/31/2016		370
2/28/2016		370
3/31/2016		369
4/30/2016		328
5/31/2016		328
6/30/2016		259
7/31/2016		255
8/31/2016		255
9/30/2016		235
10/31/2016		235
11/30/2016		235
12/31/2016		235
1/31/2017		235
2/28/2017		235
3/31/2017		235
4/30/2017		235
5/31/2017		235
6/30/2017		205
7/31/2017		205
8/31/2017		205
9/30/2017		184
10/31/2017		184
11/30/2017		184
12/31/2017		184
1/31/2018		184
2/28/2018		184
3/31/2018		184
4/30/2018		184
5/31/2018		184
6/30/2018		184
7/31/2018		184
8/31/2018		184
9/30/2018		184
10/31/2018		184
11/30/2018		184
12/31/2018		183
1/31/2019		183
2/28/2019		183

Date		Balance (in millions of USD)
3/31/2019		180
4/30/2019		180
5/31/2019		180
6/30/2019		180
7/31/2019		180
8/31/2019		180
9/30/2019		180
10/31/2019		180
11/30/2019		180
12/31/2019		180
1/31/2020		180
2/28/2020		180
3/31/2020		180
4/30/2020		180
5/31/2020		180
6/30/2020		180
7/31/2020		180
8/31/2020		180
9/30/2020		180
10/31/2020		180
11/30/2020		180
12/31/2020		180
1/31/2021		180
2/28/2021		180
3/31/2021		173
4/30/2021		173
5/31/2021		173
6/30/2021		158
7/31/2021		158
8/31/2021		158
9/30/2021		144
10/31/2021		144
11/30/2021		144
12/31/2021		130
1/31/2022		130
2/28/2022		130
3/31/2022		116
4/30/2022		116
5/31/2022		116
6/30/2022		103

Date		Balance (in millions of USD)
7/31/2022		103
8/31/2022		103
9/30/2022		91
10/31/2022		91
11/30/2022		91
12/31/2022		80
1/31/2023		80
2/28/2023		80
3/31/2023		70
4/30/2023		70
5/31/2023		70
6/30/2023		61
7/31/2023		61
8/31/2023		61
9/30/2023		53
10/31/2023		53
11/30/2023		53
12/31/2023		46
1/31/2024		46
2/28/2024		46
3/31/2024		41
4/30/2024		41
5/31/2024		41
6/30/2024		36
7/31/2024		36
8/31/2024		36
9/30/2024		32
10/31/2024		32
11/30/2024		32
12/31/2024		28
1/31/2025		28
2/28/2025		28
3/31/2025		25
4/30/2025		25
5/31/2025		25
6/30/2025		22
7/31/2025		22
8/31/2025		22
9/30/2025		19
10/31/2025		19

Date		Balance (in millions of USD)
11/30/2025		19
12/31/2025		16
1/31/2026		16
2/28/2026		16
3/31/2026		14
4/30/2026		14
5/31/2026		14
6/30/2026		11
7/31/2026		11
8/31/2026		11
9/30/2026		9
10/31/2026		9
11/30/2026		9
12/31/2026		8
1/31/2027		8
2/28/2027		8
3/31/2027		6
4/30/2027		6
5/31/2027		6
6/30/2027		6
7/31/2027		6
8/31/2027		6
9/30/2027		5
10/31/2027		5
11/30/2027		5
12/31/2027		4
1/31/2028		4
2/28/2028		4
3/31/2028		4
4/30/2028		4
5/31/2028		4
6/30/2028		4
7/31/2028		4
8/31/2028		4
9/30/2028		4
10/31/2028		4
11/30/2028		4
12/31/2028		4
1/31/2029		4
2/28/2029		4

Date		Balance (in millions of USD)
3/31/2029		4
4/30/2029		4
5/31/2029		4
6/30/2029		4
7/31/2029		4
8/31/2029		4
9/30/2029		4
10/31/2029		4
11/30/2029		4
12/31/2029		4
1/31/2030		4
2/28/2030		4
3/31/2030		4
4/30/2030		4
5/31/2030		4
6/30/2030		4
7/31/2030		4
8/31/2030		4
9/30/2030		4
10/31/2030		4
11/30/2030		4
12/31/2030		4
1/31/2031		4
2/28/2031		4
3/31/2031		4
4/30/2031		4
5/31/2031		4
6/30/2031		4
7/31/2031		4
8/31/2031		4
9/30/2031		4
10/31/2031		4
11/30/2031		4
12/31/2031		4
1/31/2032		4
2/28/2032		4
3/31/2032		4
4/30/2032		4
5/31/2032		4
6/30/2032		4

Date		Balance (in millions of USD)
7/31/2032		4
8/31/2032		4
9/30/2032		4
10/31/2032		4
11/30/2032		4
12/31/2032		4
1/31/2033		4
2/28/2033		4
3/31/2033		4
4/30/2033		4
5/31/2033		4
6/30/2033		4
7/31/2033		4
8/31/2033		4
9/30/2033		4
10/31/2033		4
11/30/2033		4
12/31/2033		4
1/31/2034		4
2/28/2034		4
3/31/2034		4
4/30/2034		4
5/31/2034		4
6/30/2034		4
7/31/2034		4
8/31/2034		4
9/30/2034		4
10/31/2034		4
11/30/2034		4
12/31/2034		4
1/31/2035		4
2/28/2035		4
3/31/2035		4
4/30/2035		4
5/31/2035		4
6/30/2035		4
7/31/2035		4
8/31/2035		4
9/30/2035		4
10/31/2035		4

Date		Balance (in millions of USD)
11/30/2035		4

Exhibit C to Schedule B — Expected Draw Schedule for Other GICs

Date		Balance (in millions of USD)
6/25/2009		4,580
6/30/2009		4,524
7/31/2009		4,261
8/31/2009		4,201
9/30/2009		4,060
10/31/2009		3,995
11/30/2009		3,916
12/31/2009		3,794
1/31/2010		3,761
2/28/2010		3,599
3/31/2010		3,412
4/30/2010		3,336
5/31/2010		3,301
6/30/2010		3,192
7/31/2010		3,090
8/31/2010		2,957
9/30/2010		2,871
10/31/2010		2,881
11/30/2010		2,793
12/31/2010		2,759
1/31/2011		2,747
2/28/2011		2,630
3/31/2011		2,595
4/30/2011		2,566
5/31/2011		2,548
6/30/2011		2,505
7/31/2011		2,515
8/31/2011		2,450
9/30/2011		2,411
10/31/2011		2,423
11/30/2011		2,428
12/31/2011		2,399
1/31/2012		2,380
2/28/2012		2,301
3/31/2012		2,236
4/30/2012		2,230
5/31/2012		2,201
6/30/2012		2,175

Date		Balance (in millions of USD)
7/31/2012		2,092
8/31/2012		2,073
9/30/2012		2,037
10/31/2012		1,947
11/30/2012		1,951
12/31/2012		1,927
1/31/2013		1,920
2/28/2013		1,839
3/31/2013		1,811
4/30/2013		1,777
5/31/2013		1,785
6/30/2013		1,748
7/31/2013		1,590
8/31/2013		1,537
9/30/2013		1,518
10/31/2013		1,541
11/30/2013		1,435
12/31/2013		1,414
1/31/2014		1,426
2/28/2014		1,326
3/31/2014		1,331
4/30/2014		1,342
5/31/2014		1,323
6/30/2014		1,288
7/31/2014		1,303
8/31/2014		1,309
9/30/2014		1,288
10/31/2014		1,328
11/30/2014		1,337
12/31/2014		1,313
1/31/2015		1,315
2/28/2015		1,223
3/31/2015		1,230
4/30/2015		1,237
5/31/2015		1,251
6/30/2015		1,142
7/31/2015		1,166
8/31/2015		1,180
9/30/2015		1,141
10/31/2015		1,181

Date		Balance (in millions of USD)
11/30/2015		1,210
12/31/2015		1,176
1/31/2016		1,180
2/28/2016		1,114
3/31/2016		1,115
4/30/2016		1,124
5/31/2016		1,139
6/30/2016		1,138
7/31/2016		1,122
8/31/2016		1,145
9/30/2016		1,131
10/31/2016		1,157
11/30/2016		1,179
12/31/2016		1,181
1/31/2017		1,183
2/28/2017		1,112
3/31/2017		1,120
4/30/2017		1,115
5/31/2017		1,135
6/30/2017		1,142
7/31/2017		1,159
8/31/2017		1,144
9/30/2017		1,132
10/31/2017		1,163
11/30/2017		1,188
12/31/2017		1,177
1/31/2018		1,188
2/28/2018		1,126
3/31/2018		1,125
4/30/2018		1,112
5/31/2018		1,128
6/30/2018		1,122
7/31/2018		1,154
8/31/2018		1,155
9/30/2018		1,099
10/31/2018		1,083
11/30/2018		1,111
12/31/2018		1,118
1/31/2019		1,125
2/28/2019		1,059

Date		Balance (in millions of USD)
3/31/2019		1,046
4/30/2019		1,057
5/31/2019		1,081
6/30/2019		1,072
7/31/2019		1,108
8/31/2019		1,108
9/30/2019		1,098
10/31/2019		1,103
11/30/2019		1,132
12/31/2019		1,139
1/31/2020		1,148
2/28/2020		1,053
3/31/2020		1,070
4/30/2020		1,089
5/31/2020		1,096
6/30/2020		1,096
7/31/2020		1,138
8/31/2020		1,143
9/30/2020		1,116
10/31/2020		1,158
11/30/2020		1,155
12/31/2020		1,157
1/31/2021		1,158
2/28/2021		1,099
3/31/2021		1,058
4/30/2021		1,083
5/31/2021		1,096
6/30/2021		1,087
7/31/2021		1,114
8/31/2021		1,132
9/30/2021		1,115
10/31/2021		1,147
11/30/2021		1,184
12/31/2021		1,156
1/31/2022		1,161
2/28/2022		1,100
3/31/2022		1,083
4/30/2022		1,097
5/31/2022		1,112
6/30/2022		1,092

Date		Balance (in millions of USD)
7/31/2022		1,105
8/31/2022		1,122
9/30/2022		1,115
10/31/2022		1,144
11/30/2022		1,174
12/31/2022		1,175
1/31/2023		1,185
2/28/2023		1,087
3/31/2023		1,105
4/30/2023		1,099
5/31/2023		1,108
6/30/2023		1,102
7/31/2023		1,117
8/31/2023		1,119
9/30/2023		1,116
10/31/2023		1,135
11/30/2023		1,146
12/31/2023		1,143
1/31/2024		1,162
2/28/2024		1,145
3/31/2024		1,131
4/30/2024		1,122
5/31/2024		1,122
6/30/2024		1,112
7/31/2024		1,122
8/31/2024		1,133
9/30/2024		1,129
10/31/2024		1,139
11/30/2024		1,147
12/31/2024		1,155
1/31/2025		1,171
2/28/2025		1,179
3/31/2025		1,195
4/30/2025		1,153
5/31/2025		1,157
6/30/2025		1,133
7/31/2025		1,156
8/31/2025		1,149
9/30/2025		1,140
10/31/2025		1,156

Date		Balance (in millions of USD)
11/30/2025		1,165
12/31/2025		1,157
1/31/2026		1,169
2/28/2026		1,154
3/31/2026		1,156
4/30/2026		1,146
5/31/2026		1,144
6/30/2026		1,112
7/31/2026		1,132
8/31/2026		1,123
9/30/2026		1,110
10/31/2026		1,124
11/30/2026		1,130
12/31/2026		1,112
1/31/2027		1,117
2/28/2027		1,125
3/31/2027		1,127
4/30/2027		1,131
5/31/2027		1,130
6/30/2027		1,119
7/31/2027		1,140
8/31/2027		1,133
9/30/2027		1,136
10/31/2027		1,152
11/30/2027		1,174
12/31/2027		1,172
1/31/2028		1,183
2/28/2028		1,194
3/31/2028		1,205
4/30/2028		1,187
5/31/2028		1,188
6/30/2028		1,082
7/31/2028		1,092
8/31/2028		1,097
9/30/2028		1,047
10/31/2028		1,062
11/30/2028		1,082
12/31/2028		1,052
1/31/2029		1,077
2/28/2029		1,092

Date		Balance (in millions of USD)
3/31/2029		1,097
4/30/2029		1,103
5/31/2029		1,103
6/30/2029		1,045
7/31/2029		1,035
8/31/2029		1,038
9/30/2029		1,033
10/31/2029		1,040
11/30/2029		1,057
12/31/2029		1,031
1/31/2030		1,031
2/28/2030		1,043
3/31/2030		1,063
4/30/2030		1,040
5/31/2030		1,034
6/30/2030		994
7/31/2030		1,001
8/31/2030		1,005
9/30/2030		965
10/31/2030		969
11/30/2030		972
12/31/2030		969
1/31/2031		983
2/28/2031		988
3/31/2031		1,009
4/30/2031		998
5/31/2031		992
6/30/2031		939
7/31/2031		947
8/31/2031		953
9/30/2031		831
10/31/2031		812
11/30/2031		820
12/31/2031		610
1/31/2032		616
2/28/2032		625
3/31/2032		646
4/30/2032		636
5/31/2032		638
6/30/2032		581

Date		Balance (in millions of USD)
7/31/2032		600
8/31/2032		587
9/30/2032		596
10/31/2032		597
11/30/2032		601
12/31/2032		614
1/31/2033		592
2/28/2033		601
3/31/2033		608
4/30/2033		612
5/31/2033		610
6/30/2033		537
7/31/2033		553
8/31/2033		544
9/30/2033		490
10/31/2033		491
11/30/2033		494
12/31/2033		450
1/31/2034		436
2/28/2034		442
3/31/2034		449
4/30/2034		452
5/31/2034		449
6/30/2034		317
7/31/2034		335
8/31/2034		322
9/30/2034		207
10/31/2034		201
11/30/2034		213
12/31/2034		81
1/31/2035		86
2/28/2035		100
3/31/2035		106
4/30/2035		106
5/31/2035		100
6/30/2035		76
7/31/2035		77
8/31/2035		77
9/30/2035		80
10/31/2035		69

Date		Balance (in millions of USD)
11/30/2035		82
12/31/2035		67
1/31/2036		67
2/28/2036		69
3/31/2036		75
4/30/2036		72
5/31/2036		72
6/30/2036		65
7/31/2036		67
8/31/2036		68
9/30/2036		70
10/31/2036		66
11/30/2036		78
12/31/2036		63
1/31/2037		64
2/28/2037		66
3/31/2037		81
4/30/2037		66
5/31/2037		66
6/30/2037		68
7/31/2037		69
8/31/2037		69
9/30/2037		72
10/31/2037		66
11/30/2037		65
12/31/2037		66
1/31/2038		67
2/28/2038		67
3/31/2038		82
4/30/2038		65
5/31/2038		66
6/30/2038		68
7/31/2038		70
8/31/2038		71
9/30/2038		73
10/31/2038		68
11/30/2038		67
12/31/2038		66
1/31/2039		67
2/28/2039		68

Date		Balance (in millions of USD)
3/31/2039		83
4/30/2039		65
5/31/2039		67
6/30/2039		67
7/31/2039		82
8/31/2039		69
9/30/2039		71
10/31/2039		63
11/30/2039		62
12/31/2039		63
1/31/2040		65
2/28/2040		68
3/31/2040		64
4/30/2040		61
5/31/2040		60
6/30/2040		59
7/31/2040		72
8/31/2040		61
9/30/2040		65
10/31/2040		65
11/30/2040		64
12/31/2040		63
1/31/2041		60
2/28/2041		58
3/31/2041		60
4/30/2041		58
5/31/2041		57
6/30/2041		58
7/31/2041		72
8/31/2041		60
9/30/2041		63
10/31/2041		60
11/30/2041		72
12/31/2041		56
1/31/2042		59
2/28/2042		64
3/31/2042		65
4/30/2042		61
5/31/2042		62
6/30/2042		57

Date		Balance (in millions of USD)
7/31/2042		58
8/31/2042		60
9/30/2042		57
10/31/2042		55
11/30/2042		68
12/31/2042		52
1/31/2043		53
2/28/2043		57
3/31/2043		59
4/30/2043		57
5/31/2043		57
6/30/2043		53
7/31/2043		54
8/31/2043		55
9/30/2043		56
10/31/2043		50
11/30/2043		63
12/31/2043		48
1/31/2044		48
2/28/2044		48
3/31/2044		62
4/30/2044		45
5/31/2044		45
6/30/2044		49
7/31/2044		49
8/31/2044		50
9/30/2044		52
10/31/2044		44
11/30/2044		43
12/31/2044		41
1/31/2045		42
2/28/2045		43
3/31/2045		56
4/30/2045		40
5/31/2045		41
6/30/2045		41
7/31/2045		42
8/31/2045		43
9/30/2045		44
10/31/2045		36

Date		Balance (in millions of USD)
11/30/2045		36
12/31/2045		37
1/31/2046		37
2/28/2046		38
3/31/2046		52
4/30/2046		35
5/31/2046		36
6/30/2046		37
7/31/2046		50
8/31/2046		37
9/30/2046		38
10/31/2046		27
11/30/2046		3
12/31/2046		3
1/31/2047		3
2/28/2047		3
3/31/2047		3
4/30/2047		3
5/31/2047		3
6/30/2047		3

Exhibit D to Schedule B — Amortization Assumptions

For Structured GICs:

· ABS CDO GICs :

For the ABS CDO GICs, 10 of the ABS CDO transactions in our GIC portfolio, representing approximately 65% of the outstanding notional amount, are modeled in Intex. We applied subprime and Alt-A default and severity curves to the respective portions of the underlying assets consistent with the average rates used in our impairment analysis. For the subprime assets, the CDR plateau was 28.84% which remained constant for 21 months followed by a 12 month linear decline to 7.21%. For the Alt-A assets, a CDR plateau of 19.62% was used for the first 21 months followed by a 12 month linear decline to 4.91%. Severities for subprime are assumed to increase from 50% to 60% over the first 15 months after which they remained constant at 60% for the remaining life. For the Alt-A assets, severities were assumed to increase from 40% to 50% over the first 15 months after which they remained constant at 50% for the remaining life. Prepayments were assumed to be 5% for the first 21 months followed by a 12 month linear ramp up to 15% after which the rate remained constant at 15% for the remaining life. For the transactions that we were unable to model, the average of the modeled schedules was used to project the GIC balance.

· CDO/CLO GICs :

We use Moody’s average historical default rates, applied to the underlying collateral of each CDO/CLO deal. The loss severity is 50% for loans and 70% for senior unsecured bonds. The Moody’s historical default rates are rating dependent.

For other GICs, the schedules are reviewed periodically by risk management according to the process and procedure specified in the ALM guidelines

Schedule C — Valuation Procedures

I. For assets other than FSA PAL bonds and the Private Placement Securities specified in III. below (“Private Placement Securities”), The Bank of New York Mellon and Wells Fargo Bank, National Association (each, an “Account Bank”) will determine the Indicative Market Value of each FSAM Asset or item of Eligible Collateral (for purposes of this Schedule C, an “Asset”) each in accordance with the market prices provided to the Account Bank by one or more nationally-recognized third party pricing services which the Account Bank uses generally for pricing assets of a similar type to the Assets, and in any event in accordance with the standard procedure and methodology utilized by the Account Bank in valuing securities held by it (including such procedures it generally adopts in the absence of data available from its preferred third-party pricing services), whether for its own account or the accounts of other customers, as such procedure and methodology may be amended by the Account Bank from time to time for general application with respect to securities held by it, whether for its own account or the accounts of other customers.

II. Valuation of FSA PAL bonds will be reported by the Administrator to the Valuation Agent based on the valuation of Royal Bank of Scotland (RBS), a dealer in UK Inflation-Indexed bonds. Prices are determined by RBS based on prices observed on trades of similar fixed rate bonds which are relatively liquid, and spreads from the inflation swap yield curve. In the case of bonds with tenors of greater than 30 years, such inputs are modified by an additional spread premium from market sources, including bid and offer lists, and the prices on observed trades are combined with the swap spreads to arrive at a yield used to derive a price for the Asset/Swap.

III. With respect to the Private Placement Securities, the Administrator will determine the prices of these assets as follows: 1. On each Valuation Date obtain FSA’s 5-year CDS spread from Bloomberg using the ticker “FSA INS CDS USD SR 5Y” and add 200 basis points (the spread so obtained the “ FSA Spread ”). 2. Calculate the present values, based on the then current swap curve rate (as derived from market data reported by recognized pricing information service providers and using recognized systems-based curve-building models) plus the FSA Spread, of the projected payments of principal and interest on the relevant Private Placement Security based on the projections thereof determined by FSA and as most recently advised to the Administrator by FSA . 3. Express the sum of the values in 2 as a percentage of the current principal balance of such Private Placement Security . The percentage price so determined will be reported by the Administrator to the Valuation Agent.

The Private Placement Securities are listed below:

ID	Balance	WAL	Price (5/31)
BAY_VEIW_FMAC_1998_D_REFI_SERIES_15	16.9	8.3	45.3
BAY_VIEW_FMAC_1998_D_REFI_SERIES_10	1.3	3.3	69.4
BAY_VIEW_FMAC_1998_D_REFI_SERIES_11	15.5	4.3	62.5
BAY_VIEW_FMAC_1998_D_REFI_SERIES_12	8	5.3	56.8
BAY_VIEW_FMAC_1998_D_REFI_SERIES_13	4	6.3	52.1
BAY_VIEW_FMAC_1998_D_REFI_SERIES_14	4	7.3	48.3
BAY_VIEW_FMAC_2000_A_REFI_SERIES_10	15.3	3.4	66.7
BAY_VIEW_FMAC_2000_A_REFI_SERIES_11	14.6	4.4	59.7
BAY_VIEW_FMAC_2000_A_REFI_SERIES_12	6.5	5.3	54
BAY_VIEW_FMAC_2000_A_REFI_SERIES_13	2	6.3	49.3
BAY_VIEW_FMAC_2000_A_REFI_SERIES_14	2	7.4	45.6

BAY_VIEW_FMAC_2000_A_REFI_SERIES_15	31.3	8.4	42.7
BAY_VIEW_FMAC_2000_A_REFI_SERIES_9	6.4	2.3	76.7
IMC_97-7_REFI_NOTES	20.8	1.8	78.4
MLN_1999_2_REFI	11.6	3.3	64.6
WESTLAKE_FUNDING_II_LLC_A	0.004	0.1	100
WESTLAKE_FUNDING_II_LLC_POOL10	0.8	0.3	95.8
WESTLAKE_FUNDING_II_LLC_POOL11	1	0.3	95.7
WESTLAKE_FUNDING_II_LLC_POOL12	1.6	0.4	95.3
WESTLAKE_FUNDING_II_LLC_POOL13	3.3	0.4	94.6
WESTLAKE_FUNDING_II_LLC_POOL14	2.2	0.4	94.7
WESTLAKE_FUNDING_II_LLC_POOL15	2.7	0.4	94.1
WESTLAKE_FUNDING_II_LLC_POOL16	3.6	0.5	93.3
WESTLAKE_FUNDING_II_LLC_POOL17	4.1	0.5	92.8
WESTLAKE_FUNDING_II_LLC_POOL18	5.7	0.5	93
WESTLAKE_FUNDING_II_LLC_POOL19	9.1	0.6	91.9
WESTLAKE_FUNDING_II_LLC_POOL2	0.02	0.1	99.6
WESTLAKE_FUNDING_II_LLC_POOL20	5.7	0.6	91.8
WESTLAKE_FUNDING_II_LLC_POOL21	5.2	0.7	90.7
WESTLAKE_FUNDING_II_LLC_POOL22	5.7	0.7	91.2
WESTLAKE_FUNDING_II_LLC_POOL23	4.9	0.8	90
WESTLAKE_FUNDING_II_LLC_POOL24	5.3	0.8	89.4
WESTLAKE_FUNDING_II_LLC_POOL25	5.9	0.9	88.8
WESTLAKE_FUNDING_II_LLC_POOL26	6.7	0.8	89
WESTLAKE_FUNDING_II_LLC_POOL3	0.04	0.1	98.7
WESTLAKE_FUNDING_II_LLC_POOL4	0.1	0.1	98.2
WESTLAKE_FUNDING_II_LLC_POOL5	0.03	0.2	97.9
WESTLAKE_FUNDING_II_LLC_POOL6	0.2	0.2	97.4
WESTLAKE_FUNDING_II_LLC_POOL7	0.2	0.2	97.2
WESTLAKE_FUNDING_II_LLC_POOL8	0.4	0.3	96.5
WESTLAKE_FUNDING_II_LLC_POOL9	1	0.3	96.3

In Principia (a pricing information service provider) , principal amortization for the Westlake transactions are ratio stripped (see definition below) monthly and re-projected (as defined below) periodically, when new projections are provided by Financial Security Assurance Inc. In the future, the Westlake transactions will be re-projected quarterly. Principal amortization for the MLN and IMC transactions have generally not been re-projected, but will be re-projected quarterly going forward in addition to being ratio stripped monthly. The Bayview FMAC transactions are tranched into fixed-rate bullets, which are not re-projected in Principia because of make-whole provisions. However, on a monthly basis, Financial Security Assurance Inc. provides and will continue to provide a statement detailing the distribution of interest, principal and any make-whole payment if applicable.

“Ratio Stripping ” is the process by which principal amortization that is either greater or less than the projected amount is evenly distributed over the remaining principal payment dates.

“ Re-projection ” is the process of recalculating principal amortization based on updating assumptions for interest rates and underlying loan characteristics such as prepayments, defaults, and loss severity.

Schedule D — Forms of Subordinated Hedge Arrangements

AMENDMENT AGREEMENT

dated as of [ ], 2009

among:	[COUNTERPARTY] (“ Party A ”)

and	FSA ASSET MANAGEMENT LLC (“ FSAM ” or “ Party B ”)

and	DEXIA CRÉDIT LOCAL S.A. (“ DCL ”);

and	FINANCIAL SECURITY ASSURANCE INC. (“ FSA ”)

W I T N E S S E T H

WHEREAS, Party A and Party B are parties to an ISDA Master Agreement, dated as of [ ], as amended and supplemented from time to time, including pursuant to any Schedule and Credit Support Annex thereto (any such Credit Support Annex, the “ FSAM Credit Support Annex ”) (collectively, the “ FSAM Master Agreement ”);

WHEREAS, FSA has issued a financial guaranty insurance policy (the “ FSA Policy ”) in respect of the obligations of Party B pursuant to the FSAM Master Agreement;

WHEREAS, Party A and DCL are parties to an ISDA Master Agreement, dated as of [ ], as amended and supplemented from time to time, including pursuant to any Schedule and Credit Support Annex thereto (any such Credit Support Annex, the “ DCL Credit Support Annex ”) (collectively, the “ DCL Master Agreement ”);

WHEREAS, the parties wish to amend the FSAM Master Agreement and DCL Master Agreement as set forth below; and

WHEREAS, reference is made to a certain Pledge and Administration Agreement (the “ Pledge and Administration Agreement ”), dated as of June 30, 2009, among Dexia SA, DCL, Dexia Bank Belgium SA, FSA, Party B, FSA Portfolio Asset Limited, FSA Capital Markets Services LLC, FSA Capital Management Services LLC, FSA Capital Markets Services (Caymans) Ltd., and The Bank of New York Mellon Trust Company, as the same may be amended, supplemented or modified from time to time.

NOW, THEREFORE, in consideration of the premises and agreements contained herein and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto hereby agree to the following:

ARTICLE I

AMENDMENTS TO FSAM MASTER AGREEMENT

The parties agree that the FSAM Master Agreement shall be amended, as of the Amendment Effective Date defined below, as follows:

SECTION 1.1. DCL Guarantee . Subject to the delivery by Party A of an executed counterpart of this Amendment Agreement, DCL shall guarantee the full and punctual payment when due of the Obligations as set forth in a guarantee issued in favor of Party A in the form attached as Exhibit A hereto (the “ DCL Guarantee ”). The DCL Guarantee shall be a “Credit Support Document” for purposes of the FSAM Master Agreement, and DCL shall be the “Credit Support Provider” of Party B thereunder. Any

references to Party B’s Credit Support Provider in the FSAM Master Agreement shall hereafter be deemed to be references to DCL.

SECTION 1.2. Termination of FSA Policy . Party A hereby consents to the cancellation of the Financial Guaranty Insurance Policy of FSA (Policy No. [ ]) (the “ FSA Policy ”) with effect from the Amendment Effective Date, and irrevocably agrees that all of Party A’s rights in respect of the FSA Policy shall be irrevocably terminated and cancelled, and all of FSA’s duties and obligations thereunder, whether arising before, on or after the Amendment Effective Date, shall be deemed fully and finally released and discharged. Party A agrees to promptly surrender the FSA Policy to FSA, and covenants that it shall not submit any claims thereunder (any such claim being void ab initio). This Section 1.2 shall survive any termination of this Amendment Agreement.

SECTION 1.3. Modifications to FSAM Agreement in respect of FSA .

(a) References to the FSA Policy and any “FSA Event of Default” in the FSAM Master Agreement, or any other Credit Support Default or Termination Event referencing an event or circumstance with respect to FSA, shall be deemed deleted. Any Events of Default or Termination Events, or limitations on the exercise of Party A’s rights under the FSAM Master Agreement, in each case, that would be conditioned on the occurrence or non-occurrence of an FSA Event of Default shall have no further effect.

(b) FSA shall have no further obligations under or in relation to the FSAM Master Agreement, shall be deemed deleted as a party to the FSAM Master Agreement, and shall have no further rights to receive payments under the FSAM Master Agreement (whether directly or by rights of subrogation, reimbursement or otherwise). FSA shall continue to be a third party beneficiary of the FSAM Master Agreement in relation to (i) any rights to inspect or receive notices and information in relation to the FSAM Master Agreement and (ii) any rights of consent to the exercise of, or to exercise directly, the rights of Party B in relation to the FSAM Master Agreement (as amended by this Amendment Agreement and subject to (c) below).

(c) Any rights of FSAM under the FSAM Master Agreement which may be or are required to be exercised directly by FSA will be exercisable directly by DCL, unless and until FSA gives notice to Party A that a GIC Program Default has occurred. Following delivery of such notice, such rights of FSAM under the FSAM Master Agreement may or shall be exercised by the Collateral Agent under the Pledge and Administration Agreement. Party A may accept without further investigation or inquiry any notice from FSA that a GIC Program Default has occurred.

(d) Any requirements to deliver financial statements of FSA or its Affiliates previously applicable under Part 3 of the Schedule shall no longer apply.

(e) Party A shall continue to deliver to FSA copies of notices to Party B, at the address indicated in the FSAM Master Agreement or such other address as FSA may request from time to time.

(f) All notices delivered by or to Party A from time to time under the FSAM Master Agreement shall additionally be copied to the following address for DCL:

Address: Dexia Crédit Local S.A.

Tour Dexia La Défense 2

1, Passerelle des Reflets

TSA 92202

92919 La Défense Cedex

France

Attention: Back-Office Department

Telephone: + 00 33 1 58 58 68 92

Facsimile: + 00 33 1 58 58 66 20

In addition, all notices in respect of Section 5 and Section 6 shall be copied to :

Attention : Tax and Legal Director

Telephone: + 00 33 1 58 58 58 70

Facsimile: + 00 33 1 58 58 69 90

SECTION 1.4. Transfers under the FSAM Credit Support Annex .

(a) Each obligation of FSAM to Transfer (i) a Delivery Amount to Party A from time to time under Paragraph 3(a) of the FSAM Credit Support Annex, (ii) a Return Amount to Party A from time to time under Paragraph 3(b) of the FSAM Credit Support Annex (iii) any amount from time to time under Paragraph 5 of the FSAM Credit Support Annex (a “ Disputed Amount ”), or (iv) a Transfer under Paragraph 8(d) of the FSAM Credit Support Annex (a “ Final Return Amount ”), as applicable, shall be considered to have been performed by FSAM, and FSAM shall have no responsibility or liability therefor, to the extent DCL shall have performed its obligations under the DCL Credit Support Annex in relation to such Delivery Amount, Return Amount, Disputed Amount or Final Return Amount, as applicable (each a “ Guarantor Transfer Amount ”).

(b) Each obligation of Party A to Transfer (i) a Delivery Amount to FSAM from time to time under Paragraph 3(a) of the FSAM Credit Support Annex, (ii) a Return Amount to FSAM from time to time under Paragraph 3(b) of the FSAM Credit Support Annex (iii) any amount from time to time under Paragraph 5 of the FSAM Credit Support Annex (a “ Disputed Amount ”), or (iv) a Final Return Amount owed by Party A under Paragraph 8(d) of the FSAM Credit Support Annex, as applicable, shall be made to DCL on behalf of FSAM by Party A, and shall be considered to have been performed by Party A, and Party A shall have no responsibility or liability therefor, to the extent Party A shall have made a Transfer to DCL of such Delivery Amount, Return Amount, Disputed Amount or Final Return Amount, as applicable.

(c) For the avoidance of doubt, the calculation of the Exposure of FSAM as Secured Party to Party A shall not be reduced, netted or set off against any Exposure of Party A to DCL under the DCL Master Agreement.

(d) Any rights or obligations of FSAM as Secured Party under Paragraph 4(d) ( Substitutions ) or Paragraph 6 ( Holding and Using Posted Collateral ) shall be enforceable by DCL directly and performed directly on behalf of FSAM by DCL, as applicable.

SECTION 1.5. Modification to Events of Default .

(a) The occurrence of a Potential Event of Default with respect to which DCL is the Defaulting Party under the DCL Master Agreement shall constitute a Potential Event of Default with respect to which FSAM would be the Defaulting Party under the FSAM Master Agreement.

(b) The occurrence of an Event of Default with respect to which DCL is the Defaulting Party under the DCL Master Agreement shall constitute an Event of Default with respect to which FSAM is the Defaulting Party under the FSAM Master Agreement.

(c) Unless a Potential Event of Default with respect to which DCL would be the Defaulting Party under the DCL Master Agreement has occurred and is continuing, no event or circumstance with respect to FSAM under the FSAM Master Agreement shall constitute a Potential Event of Default with respect to which Party B would be the Defaulting Party.

(d) Unless an Event of Default with respect to which DCL is the Defaulting Party under the DCL Master Agreement has occurred and is continuing, no event or circumstance with respect to FSAM under the FSAM Master Agreement shall constitute an Event of Default with respect to which Party B is the Defaulting Party.

SECTION 1.6. Payments by Party B under FSAM Master Agreement . All payment obligations of Party B under the FSAM Master Agreement, including, without limitation, the obligation to pay any Interest Amount on Posted Collateral, or to pay any amount pursuant to Section 6(d)(ii), shall be subject to the Priority of Payments set forth in Section 11.1(b) of the Pledge and Administration Agreement and payment of such amounts by FSAM shall be further subject to satisfaction of the Subordinated Claims Payment Condition specified in the Pledge and Administration Agreement. For the avoidance of doubt, the limitations set out in the Priority of Payments shall not prejudice Party A’s rights as against DCL under the DCL Guarantee or the DCL Credit Support Annex as provided in Section 1.4 above.

Upon any request by Party A from time to time, DCL (if no GIC Program Default has occurred) and FSA (if a GIC Program Default has occurred) each agree to use commercially reasonable efforts to inform Party A in accordance with the notice provisions of the FSAM Master Agreement whether the Subordinated Claims Payment Condition is satisfied.

SECTION 1.7. Transfer . The FSAM Master Agreement shall be amended to include the following provisions in Part 5 thereof and shall replace in its entirety any similar operative provision therein:

“ Transfer. Section 7 of the Agreement shall be replaced with the following:

Subject to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by a party without the prior written consent of the other party and DCL (such consent not to be unreasonably withheld or delayed), except that:

(a) If FSA gives notice to Party A that a GIC Program Default has occurred, Party B may (with the prior written consent of FSA) and at the direction of FSA shall

(I) transfer all of its rights and obligations under this Agreement to DCL such that FSAM shall be released from any liability under this Agreement and all Transactions under this Agreement shall become Transactions subject to the DCL Master Agreement (such transfer a “ DCL Novation ”), without the consent of Party A (provided that no Event of Default with respect to DCL has occurred and is continuing under the DCL Master Agreement); or

(II) transfer all of its rights and obligations under this Agreement (including each Credit Support Document) to a Successor Swap Entity, such that FSAM shall be released from any liability under this Agreement (a “ DCL Guaranteed SPV Novation ”), without the consent of Party A;

(b) If a GIC Program Default has occurred and FSA has not exercised either of the rights under (a)(I) or (II) within 90 days thereof, Party B may, and at the direction of DCL shall,

effect a DCL Novation without the consent of Party A (provided that no Event of Default with respect to DCL has occurred and is continuing under the DCL Master Agreement);

(c) In connection with any FSAM Refinancing, Party B may, and at the direction of DCL shall, effect a DCL Guaranteed SPV Novation, without the consent of Party A;

(d) Party B may grant a security interest over all of its right, title and interest in, to and under, in each case, whether now owned or existing, or hereafter acquired or arising, this Agreement and each Transaction hereunder (including, without limitation, its right to payments due to it hereunder or with respect hereto), to the Collateral Agent (as defined in the Pledge and Administration Agreement) pursuant to and in accordance with the terms of the Pledge and Administration Agreement, for the benefit of the persons identified therein.

(e) 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); and

(f) 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), provided that any transferee of a claim for such amounts payable by FSAM shall expressly acknowledge in connection with such transfer that such transferee will be subject to the provisions of Sections 1.6 and 1.9.

Any purported transfer that is not in compliance with this Section will be void.

“ FSAM Refinancing ” means completion of the transactions effected to refinance the intercompany repurchase agreement financing of FSAM with secured indebtedness issued to one or more third parties in connection with, and subject to the satisfaction of the conditions for, the occurrence of a Lien Release Date under the Pledge and Administration Agreement in accordance with Section 2.6(d) of the Pledge and Administration Agreement.

“ Successor Swap Entity ” means any of (i) FSA Capital Markets Services LLC, FSA Capital Management Services LLC or (ii) any special purpose entity or similar bankruptcy-remote entity that is organized in Party B’s jurisdiction of organization and is either (x) an Affiliate of DCL or (y) an Affiliate of FSA to which DCL has given its consent not to be unreasonably withheld, the obligations of which under the FSAM Master Agreement as transferred are (A) in the case of a DCL Guaranteed SPV Novation following a GIC Program Default, secured (subject to the Priority of Payments and satisfaction of the Subordinated Claims Payment Condition in the Pledge and Administration Agreement) under the Pledge and Administration Agreement by the FSAM Collateral and/or the proceeds thereof following an exercise of creditor’s remedies in relation thereto as a result of the relevant GIC Program Default and (B) in the case of a DCL Guaranteed SPV Novation occurring in connection with an FSAM Refinancing, secured by the same assets of FSAM which secure the third party indebtedness issued in connection with such FSAM Refinancing. In the case of a DCL Guaranteed SPV Novation arising under Section 7(a)(II), the Successor Swap Entity shall be identified by FSA, and in the case of a DCL Guaranteed SPV Novation arising under Section 7(b), the Successor Swap Entity shall be identified by DCL.”

SECTION 1.8 DCL Subrogation and Termination Claims .

(a) Subject to and conditioned upon payment of any amount owed under this Agreement by or on behalf of DCL and subject to DCL having performed all its obligations under the DCL Guarantee

which have become due and payable prior to such date, Party A shall assign to DCL all rights to the payment of amounts owed to it under this Agreement (other than any amounts owed to Party A pursuant to the DCL Guarantee) to the extent of all payments made by DCL and, subject to the Priority of Payments set forth in Section 11.1(b) of the Pledge and Administration Agreement and satisfaction of the Subordinated Claims Payment Condition, DCL may exercise any right, power or the like of Party A with respect thereto. Party A and Party B agree that without the need for any further action on the part of DCL, DCL shall be fully subrogated to all of the rights to payment of Party A (other than any amounts owed to Party A pursuant to the DCL Agreement) or in relation thereto to the extent that payments are made under the DCL Guarantee by or on behalf of DCL; provided that DCL’s right of recovery from Party B shall be subject to the Priority of Payments set forth in Section 11.1(b) of the Pledge and Administration Agreement and to satisfaction of the Subordinated Claims Payment Condition.

(b) If FSA or DCL, as applicable, exercises its right to cause Party B to effect a DCL Novation, then in consideration for such DCL Novation, FSA shall in relation to each Transaction under the FSAM Master Agreement specify either that (x) DCL shall have a claim against FSAM for the greater of (I) zero and (II) the termination value of such Transaction in favor of DCL determined as if DCL were Party A under the FSAM Master Agreement, an Additional Termination Event had occurred in relation to which Party B was the Affected Party and such Transaction was an Affected Transaction, and an Early Termination Date were designated in relation to such Transaction on the date the DCL Novation is effected (and for the avoidance of doubt DCL’s right of recovery from FSAM for such claim shall be subject to the Priority of Payments set forth in Section 11.1(b) of the Pledge and Administration Agreement and to the Subordinated Claims Payment Condition) or (y) DCL shall be deemed to have entered into an Offsetting Transaction with a Successor Swap Entity. If FSA fails to make such election and specify the application of (x) or (y) within 30 days after the DCL Novation, then clause (x) will be deemed to apply. For purposes hereof, “ Offsetting Transaction ” means in relation to any Transaction under the FSAM Master Agreement outstanding at the time of a DCL Novation, a corresponding transaction between DCL and a Successor Swap Entity, having substantially identical terms to such Transaction, with DCL in the position of Party A and the Successor Swap Entity in the position of Party B, where the obligations of the Successor Swap Entity and DCL shall be subject to the terms of the ISDA Master Agreement between DCL and FSAM on the date of such DCL Novation, including without limitation the Nonpetition and Limited Recourse provisions set forth in Section 1.9 below.

SECTION 1.9. Non-Petition; Limited Recourse . The FSAM Master Agreement shall be amended to include the following provisions in Part 5 thereof and shall replace in its entirety any similar operative provision therein:

“ Non-Petition . Party A agrees that it will not, prior to the date that is six months (or such longer preference period as may be in effect at such time) after the GIC Contracts (as defined in the Pledge and Administration Agreement) have been paid in full, acquiesce, petition or otherwise institute against, or join any other person in instituting against, Party B, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any federal or state bankruptcy, or similar law, including without limitations proceedings seeking to appoint a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of Party B or any substantial part of its property; provided that this provision shall not restrict or prohibit Party A from joining any such proceedings which shall have already commenced under applicable laws and not in violation of this provision. This provision shall survive the termination of this Agreement for any reason. This provision shall be without any prejudice to any rights of Party A with respect to the DCL Guarantee.”

“ Limited Recourse. The obligations of Party B in relation to this Agreement and any Transaction hereunder are limited recourse obligations, payable solely from the proceeds of the

FSAM Collateral (as defined in the Pledge and Administration Agreement) available under and applied in accordance with the Priority of Payments set forth in Section 11.1(b) of the Pledge and Administration Agreement. Upon application of the FSAM Collateral and proceeds thereof available to satisfy the obligations of Party B hereunder in accordance with the Pledge and Administration Agreement, Party A shall not be entitled to take any further steps against Party B to recover any sums due and shall not constitute a claim against Party B to the extent of any insufficiency. No recourse shall be had for the payment of any amounts owing in respect of this Agreement against any officer, director, employee, stockholder or incorporator of Party B. This provision (x) shall be without any prejudice to any rights of Party A with respect to the DCL Guarantee and (y) shall survive the termination of this Agreement for any reason.”

SECTION 1.10. Definitions . The FSAM Master Agreement shall be amended to include the following definitions:

“ GIC Program Default ” means a “Dexia Event of Default” as defined in the Pledge and Administration Agreement.

“ Pledge and Administration Agreement ” means the Pledge and Administration Agreement, dated as of June 30, 2009, among Dexia SA, DCL, Dexia Bank Belgium SA, FSA, Party B, FSA Portfolio Asset Limited, FSA Capital Markets Services LLC, FSA Capital Management Services LLC, FSA Capital Markets Services (Caymans) Ltd., and The Bank of New York Mellon Trust Company, as the same may be amended, supplemented or modified from time to time.

SECTION 1.11. No FSAM-DCL Setoff . Notwithstanding any rights of Party A under the DCL Master Agreement or DCL Credit Support Annex, no payment obligations owed or other amounts due by Party A to FSAM under the FSAM Master Agreement (whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) may be reduced by or setoff or counterclaim against any payment obligations owed or other amounts due (whether or not arising under the FSAM Master Agreement, whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) by DCL or its Affiliates to Party A or its Affiliates.

For the avoidance of doubt, the foregoing shall not restrict any rights of setoff applicable in relation to the DCL Master Agreement.

SECTION 1.12. Payment Netting . If not previously applicable, Section 2(c)(ii) shall hereafter be applicable.

SECTION 1.13. Change in Control Events . In the event that the FSAM Master Agreement or any Transaction thereunder is subject to a provision specifying that an Additional Termination Event shall occur if FSAM is no longer an Affiliate of or otherwise controlled by Financial Security Assurance Holdings Ltd., such Additional Termination Event shall no longer be applicable or be of any force or effect.

SECTION 1.14. Amendment Consents . No further amendment, waiver or modification of the FSAM Master Agreement shall be effective without the prior written consent of each of DCL and FSA.

ARTICLE II

AMENDMENT TO DCL MASTER AGREEMENT

SECTION 2.1. DCL Credit Support Annex .

Each Guarantor Transfer Amount arising from the FSAM Credit Support Annex on any date shall be considered to constitute an Independent Amount (in addition to any Independent Amount otherwise applicable on any date) with respect to DCL under the DCL Credit Support Annex.

SECTION 2.2. DCL Novation .

Upon a DCL Novation, each outstanding Transaction under the FSAM Master Agreement shall become a Transaction subject to the DCL Master Agreement.

ARTICLE III

REPRESENTATIONS

SECTION 3.1. Representations .

(a) Party A repeats and remakes as of the date hereof the representations of Party A set forth in Section 3 of the FSAM Master Agreement with respect to the FSAM Master Agreement and its obligations thereunder as representations with respect to this Amendment Agreement and its obligations hereunder and the FSAM Master Agreement as amended hereby.

(b) FSAM repeats and remakes as of the date hereof the representations of FSAM set forth in Section 3 of the FSAM Master Agreement with respect to the FSAM Master Agreement and FSAM’s obligations thereunder as representations with respect to this Amendment Agreement and its obligations hereunder and the FSAM Master Agreement as amended hereby (including the DCL Guarantee as a Credit Support Document).

(c) DCL makes as of the date hereof the representations set forth in Section 3 of the FSAM Master Agreement with respect to itself, this Amendment Agreement and its obligations hereunder and the FSAM Master Agreement as amended hereby (including the DCL Guarantee as a Credit Support Document).

ARTICLE IV

MISCELLANEOUS

SECTION 4.1 Capitalized Terms . Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in the FSAM Master Agreement and the DCL Master Agreement. Where capitalized terms are used in the context of provisions set out in or relating to the FSAM Master Agreement or the DCL Master Agreement, such terms shall have the meanings assigned to them in the relevant Master Agreement to which they relate.

SECTION 4.2 Entire Agreement; References to Master Agreements . This Amendment Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect specifically thereto. Except as expressly amended herein, all of the provisions of the FSAM Master Agreement or DCL Master Agreement and each Transaction thereunder, as applicable, shall remain in full force and effect, and all references to the FSAM Master Agreement or DCL Master Agreement, as applicable, in the FSAM Master Agreement, DCL Master Agreement or any other document or instrument entered into in connection therewith shall be deemed to be references to the FSAM Master Agreement or DCL Master Agreement as amended hereby.

SECTION 4.3 Non-Reliance . Each party represents to each other party that, in connection with entering into this Amendment Agreement, (i) neither the other party nor any of its affiliates or agents are acting as a fiduciary for it and (ii) it has consulted with its own legal, regulatory, tax, business, investment, financial, and accounting advisors to the extent that it has deemed necessary, and has made its own decisions based upon its own judgments and upon any advice from such advisors as it has deemed necessary and not upon any view expressed by the other party or any of its affiliates or agents.

SECTION 4.4 Counterparts . This Amendment Agreement may be executed in counterparts by the parties hereto, each of which counterparts when executed and delivered shall be an original, but all of which together shall constitute one and the same instrument.

SECTION 4.5 Governing Law . This Amendment Agreement will be governed by and construed in accordance with the laws of the State of New York, including Section 5-1401 of the General Obligations Law of New York, but otherwise without regard to conflicts of laws principles.

SECTION 4.6. Effectiveness . This Amendment Agreement and the termination of the FSA Policy contemplated hereby will become effective upon (i) delivery to FSAM (with a copy to FSA) of an executed Guarantee, as contemplated by Section 1.1 of this Amendment Agreement, (ii) surrender of the FSA Policy terminated pursuant to Section 1.2 to FSA, and (iii) DCL’s confirmation to Party A that the Closing Date as defined in the Pledge and Administration Agreement has occurred (the date of such confirmation the “ Amendment Effective Date ”).

In Witness Whereof, the undersigned has executed this Amendment Agreement as of the date first above written .

[COUNTERPARTY]


By:
	Name:
	Title:


FSA ASSET MANAGEMENT LLC


By:
	Name:
	Title:


DEXIA CRÉDIT LOCAL S.A.


By:
	Name:
	Title:


FINANCIAL SECURITY ASSURANCE INC.


By:
	Name:
	Title:

Exhibit A

FORM OF GUARANTEE

GUARANTEE , dated as of [ ], 2009, of DEXIA CRÉDIT LOCAL S.A. (the “ Guarantor ”), in favor of [Swap Counterparty] (the “ Beneficiary ”).

1. Guarantee. In order to induce the Beneficiary to enter into the Amendment Agreement, dated [ ], 2009 (the “ Amendment Agreement ”), among the Beneficiary, the Guarantor, FSA Asset Management LLC (“ Primary Obligor ”) and Financial Security Assurance Inc. (“ FSA ”), pursuant to the [ identify relevant agreement ] (as the same may be amended, modified or supplemented from time to time) (the “ Master Agreement ”) between the Beneficiary, the Primary Obligor and FSA, from and after the date hereof the Guarantor irrevocably, absolutely and unconditionally guarantees to the Beneficiary, its successors and permitted assigns, as primary obligor and not as a surety, and the Guarantor undertakes and agrees to pay and discharge when and where due (whether at the scheduled payment dates, upon maturity, upon early termination or acceleration or otherwise), all payment or delivery obligations of the Primary Obligor to the Beneficiary arising out of or in connection with the Master Agreement or any Transaction thereunder (the “ Obligations ”). The Guarantor agrees to make any payment or perform any obligation due by the Primary Obligor under the Master Agreement on or before the time such payment or performance would be due by the Primary Obligor under the Master Agreement, to the extent such payment is not made or will be unable to be made, or such obligation is not performed or will be unable to be performed, as applicable, by the Primary Obligor. Any capitalized term used and not otherwise defined herein shall have the meaning assigned to it in the Master Agreement.

2. Successor Swap Entity . In the event that Obligations are assigned and transferred to a Successor Swap Entity as contemplated by the Amendment Agreement, this Guarantee shall apply to the obligations of the Successor Swap Entity to the Beneficiary and the Successor Swap Entity shall be considered the Primary Obligor hereunder for all purposes.

3. Nature of Guarantee. This Guarantee is a guarantee of payment and performance and not of collection. The Beneficiary shall not be obligated, as a condition precedent to performance by the Guarantor hereunder, to file any claim relating to the Obligations in the event that the Primary Obligor becomes subject to a bankruptcy, reorganization or similar proceeding, and the failure of the Beneficiary to file a claim shall not affect the Guarantor’s obligations hereunder. This Guarantee is a continuing guarantee and shall continue to be effective or be reinstated if any payment or delivery to the Beneficiary by the Primary Obligor on account of any Obligation is returned to the Primary Obligor or is rescinded upon the occurrence of any circumstance, including, but not limited to, the insolvency, bankruptcy or reorganization of the Primary Obligor.

4. Waivers. The Guarantor hereby irrevocably waives for the benefit of the Beneficiary any defenses the Guarantor may now or hereafter have arising from (i) the failure of any of the representations of the Primary Obligor set forth in Section 3(a) of the Master Agreement to be true and correct; (ii) any indulgence, concession, waiver or consent given to the Primary Obligor; (iii) any taking, exchange, release, amendment, non-perfection, realization or application of or on any security for or guarantee of the Primary Obligor’s performance of the Master Agreement; (iv) any defect as to the valid creation or existence of the Primary Obligor or any change, restructuring, or termination in or of the corporate structure or existence of the Primary Obligor; (v) any other rights (whether by counterclaim, setoff, recoupment or otherwise) or defenses (including without limitation the defense of fraud or fraud in the inducement), whether acquired by subrogation, assignment or otherwise, to the extent that such rights and defenses may be available to the Guarantor to avoid payment of its obligations under this Guaranty in accordance with the express provisions of this Guaranty or might otherwise constitute a legal or equitable

discharge or defense of a surety or guarantor, other than (a) a defense based on prior payment or performance of the Obligations in full or (b) a defense based on the failure of a condition precedent set forth in Section 2(a)(iii) of the Master Agreement to be satisfied in relation to the Obligations.

The Beneficiary may at all times agree to amend or modify any obligations of the Primary Obligor under the Master Agreement in accordance with the terms thereof; grant any time or indulgence; abstain from perfecting or enforcing any security or right which the Beneficiary may now or hereafter have from or against the Primary Obligor; and waive any provision of the Master Agreement in accordance with the terms thereof, without prejudice to this Guarantee and without discharging or in any way affecting the Guarantor’s liability hereunder. Without limitation of the foregoing, the obligations of the Guarantor hereunder shall not be discharged or impaired or otherwise affected by the failure of the Beneficiary to assert any claim or demand or to enforce any remedy under the Master Agreement, any guarantee or any other agreement or instrument, by any such amendment, waiver or modification of any provision of the Master Agreement or any other agreement or instrument, or by any default, failure or delay, willful or otherwise, of the Primary Obligor in the performance of the Obligations, or by any other act, omission or delay to do any other act that may or might in any manner or to any extent vary the risk of the Guarantor.

The liability of the Guarantor is not affected by liquidation (which includes without limitation official management, compromise, arrangement, merger, amalgamation, reconstruction, winding-up and dissolution, assignment for the benefit of creditors, bankruptcy or any similar procedure) of the Primary Obligor, merger or consolidation or the Primary Obligor with another entity or the Primary Obligor dissolving or ceasing to have legal existence for any other reason.

No notice to the Guarantor shall be required with respect to entering into new Transactions under the Master Agreement subsequent to the date hereof, and this Guarantee shall remain in full force and effect irrespective of the term or amount of obligations of the Primary Obligor in relation to the Master Agreement.

5. Termination. This Guarantee is a continuing guarantee and shall remain in full force and effect until all amounts payable or deliverable by the Primary Obligor under the Master Agreement have been paid or delivered in full and the Transactions thereunder have been terminated, provided that this Guarantee will be reinstated if any payment or delivery to the Beneficiary by the Primary Obligor on account of any Primary Obligation is returned to the Primary Obligor, is rescinded upon the occurrence of any circumstance, including, but not limited to, the insolvency, bankruptcy or reorganization of the Primary Obligor, or otherwise becomes the subject of any claim that could result in the return or disgorgement of such payment or delivery.

6. Notices . Any notice or communication required or permitted to be made hereunder shall be made in the same manner and with the same effect, unless otherwise specifically provided herein, as set forth in the Master Agreement.

Address for notices or communications to the Beneficiary:

Address: [ ]

With a copy to: [ ]

Address for notices or communications to the Guarantor:

Address: Dexia Crédit Local S.A.

Tour Dexia La Défense 2

1, Passerelle des Reflets

TSA 92202

92919 La Défense Cedex

France

Deduction or Withholding for Tax .

A. All payments under this Guarantee will be made without any deduction or withholding for or on account of any Tax unless such deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect. If the Guarantor is so required to deduct or withhold, then the Guarantor will

(i) promptly notify the Beneficiary of such requirement;

(ii) pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld from any additional amount paid by the Guarantor to the Beneficiary under this Section 7 promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against the Beneficiary;

(iii) promptly forward to the Beneficiary an official receipt (or a certified copy), or other documentation reasonably acceptable to the Beneficiary, evidencing such payment to such authorities; and

(iv) if such Tax is an Indemnifiable Tax, pay to the Beneficiary, in addition to the payment to which the Beneficiary is otherwise entitled under this Guarantee, such additional amount as is necessary to ensure that the net amount actually received by the Beneficiary (free and clear of Indemnifiable Taxes, whether assessed against the Guarantor or the Beneficiary) will equal the full amount the Beneficiary would have received had no such deduction or withholding been required. However, the Guarantor will not be required to pay any additional amount to the Beneficiary to the extent that it would not be required to be paid but for:

(X) the failure by the Beneficiary to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d) of the Master Agreement; or

(Y) the failure of a representation made by the Beneficiary pursuant to Section 3(f) of the Master Agreement to be accurate and true unless such failure would not have occurred but for (I) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into under the Master Agreement (regardless of whether such action is taken or brought with respect to a party to the Master Agreement) or (II) a Change in Tax Law as defined in the Master Agreement.

B. If

(i) The Guarantor is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding in respect of which the Guarantor would not be required to pay an additional amount to the Beneficiary under Section 7(A)(iv);

(ii) the Guarantor does not so deduct or withhold; and

(iii) a liability resulting from such Tax is assessed directly against the Guarantor, then, except to the extent the Beneficiary has satisfied or then satisfies the liability resulting from such Tax, the Beneficiary will promptly pay to the Guarantor the amount of such liability (including any related liability for interest, but including any related liability for penalties only if the Beneficiary has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)) of the Master Agreement.

8. Amendment; Assignment . This Guarantee shall not be amended, supplemented or otherwise modified except by a writing signed by both the Guarantor and the Beneficiary. The Guarantor may not assign its rights nor delegate its obligations under this Guaranty, in whole or in part, without prior written consent of the Beneficiary, and any purported assignment or delegation absent such consent is void, except for an assignment and delegation of all of the Guarantor’s rights and obligations hereunder in whatever form the Guarantor determines may be appropriate to a partnership, corporation, trust or other organization in whatever form that succeeds to all or substantially all of the Guarantor’s assets and business and that assumes such obligations by contract, operation of law or otherwise. Upon any such delegation and assumption of obligations, the Guarantor shall be relieved of and fully discharged from all obligations hereunder, whether such obligations arose before or after such delegation and assumption.

9. Governing Law; Jurisdiction. This Guarantee shall be governed by and construed in accordance with the laws of the State of New York. The Guarantor hereby irrevocably consents to, for the purposes of any proceeding arising out of this Guarantee, the exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the borough of Manhattan in New York City, and to the courts of its own corporate domicile, in respect of actions brought against it as a defendant. The Guarantor also waives any objection to the laying of venue in, and any claim of inconvenient forum with respect to these courts.

10. Waiver of Immunity and Other Waivers. To the extent that the Guarantor has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to the Guarantor or the Guarantor’s property, the Guarantor hereby irrevocably waives such immunity in respect of the Guarantor’s obligations under this Guarantee. The Guarantor hereby irrevocably waives any right to which it may be entitled on account of place of residence or domicile.

11. Waiver of Jury Trial . The Guarantor here by irrevocably waives all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Guarantee or the negotiation, administration or enforcement hereof.

12. Miscellaneous . Each reference herein to the Guarantor, the Beneficiary or the Primary Obligor shall be deemed to include their respective successors and assigns. The provisions hereof shall inure in favor of each such successor or assign, including any Successor Swap Entity to which the Master Agreement has been transferred. This Guarantee shall supersede any prior or contemporaneous representations, statements or agreements, oral or written, made by or between the parties with regard to the subject matter hereof.

In Witness Whereof, the undersigned has executed this Guarantee as of the date first above written.

	DEXIA CRÉDIT LOCAL S.A.


	By:
		Name:
		Title:

Exhibit 10.4.1

(Multicurrency—Cross Border)

ISDA Ò

International Swap Dealers Association, Inc.

MASTER AGREEMENT

dated as of June 30, 2009

DEXIA SA and DEXIA CRÉDIT LOCAL
S.A. , jointly and severally;

and

FSA ASSET MANAGEMENT LLC

Accordingly, the parties agree as follows:—

1. Interpretation

(a) Definitions . The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement.

2. Obligations

(a) General Conditions .

(i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement.

(i) in the same currency; and

(ii) in respect of the same Transaction,

(d) Deduction or Withholding for Tax .

(1) promptly notify the other party (“Y”) of such requirement;

(3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such authorities; and

(A) the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or

(ii) Liability . If:—

(2) X does not so deduct or withhold; and

(3) a liability resulting from such Tax is assessed directly against X,

3. Representations

(a) Basic Representations.

(i) Status . It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing;

(e) Payer Tax Representation . Each representation specified in the Schedule as being made by it for the purpose of this Section 3(e) is accurate and true.

(f) Payee Tax Representations . Each representation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true.

4. Agreements

Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:—

(i) any forms, documents or certificates relating to taxation specified in the Schedule or any Confirmation;

(ii) any other documents specified in the Schedule or any Confirmation; and

in each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable.

(d) Tax Agreement . It will give notice of any failure of a representation made by it under Section 3(f) to be accurate and true promptly upon learning of such failure.

5. Events of Default and Termination Events

(iii) Credit Support Default .

(3) the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document;

(vii) Bankruptcy . The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:—

Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is specified pursuant to (v) below:—

6. Early Termination

(b) Right to Terminate Following Termination Event .

(iv) Right to Terminate . If:—

(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party,

continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions.

(d) Calculations .

(i) Events of Default . If the Early Termination Date results from an Event of Default:—

(3) Second Method and Market Quotation. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the

(ii) Termination Events . If the Early Termination Date results from a Termination Event:—

(2) Two Affected Parties. If there are two Affected Parties:—

If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y.

7. Transfer

(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).

Any purported transfer that is not in compliance with this Section will be void.

8. Contractual Currency

(d) Evidence of Loss . For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made.

9. Miscellaneous

(c) Survival of Obligations . Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction.

(e) Counterparts and Confirmations .

10. Offices; Multibranch Parties

(b) Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of the other party.

11. Expenses

to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection.

12. Notices

(i) if in writing and delivered in person or by courier, on the date it is delivered;

(ii) if sent by telex, on the date the recipient’s answerback is received;

(iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or

(v) if sent by electronic messaging system, on the date that electronic message is received,

13. Governing Law and Jurisdiction

(a) Governing Law . This Agreement will be governed by and construed in accordance with the law specified in the Schedule.

(b) Jurisdiction . With respect to any suit, action or proceedings relating to this Agreement (“Proceedings”), each party irrevocably:—

14. Definitions