Exhibit 4.1 



INDENTURE

  Dated as of June 1, 2007

Between


FIRST HORIZON ABS TRUST 2007-HE1

(Issuer)


And


THE BANK OF NEW YORK

(Indenture Trustee)


FIRST HORIZON ABS TRUST 2007-HE1






TABLE OF CONTENTS


	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
Page


	
 

	
 

	
 

	



	
 

	
 

	
 

	
 


	
ARTICLE I DEFINITIONS

	
 

	
5


	
Section 1.1

	
Definitions

	
 

	
5


	
Section 1.2

	
Incorporation
  by Reference of Trust Indenture Act

	
 

	
12


	
Section 1.3

	
Rules of
  Construction

	
 

	
13


	
 

	
 

	
 


	
ARTICLE II
  THE NOTES

	
 

	
13


	
Section 2.1

	
Form

	
 

	
13


	
Section 2.2

	
Execution,
  Authentication, Delivery and Dating

	
 

	
14


	
Section 2.3

	
Registration;
  Registration of Transfer and Exchange

	
 

	
14


	
Section 2.4

	
Mutilated,
  Destroyed, Lost or Stolen Notes

	
 

	
15


	
Section 2.5

	
Persons
  Deemed Owner

	
 

	
16


	
Section 2.6

	
Payment of
  Principal and Interest Defaulted Interest

	
 

	
17


	
Section 2.7

	
Cancellation

	
 

	
17


	
Section 2.8

	
[Reserved]

	
 

	
17


	
Section 2.9

	
Release of
  Trust Estate

	
 

	
17


	
Section 2.10

	
Book-Entry Notes

	
 

	
18


	
Section 2.11

	
Notices to Clearing Agency

	
 

	
19


	
Section 2.12

	
Definitive Notes

	
 

	
19


	
Section 2.13

	
Tax Treatment

	
 

	
19


	
 

	
 

	
 


	
ARTICLE III
  COVENANTS

	
 

	
19


	
Section 3.1

	
Payment of
  Principal and Interest

	
 

	
19


	
Section 3.2

	
Maintenance
  of Office or Agency

	
 

	
20


	
Section 3.3

	
Money for
  Payments To Be Held in Trust

	
 

	
20


	
Section 3.4

	
Existence

	
 

	
21


	
Section 3.5

	
Protection
  of Trust Estate

	
 

	
22


	
Section 3.6

	
Annual
  Opinions as to the Trust Estate

	
 

	
22


	
Section 3.7

	
Performance
  of Obligations: Servicing of Mortgage Loans

	
 

	
22


	
Section 3.8

	
Negative
  Covenants

	
 

	
24


	
Section 3.9

	
Annual
  Statement as to Compliance

	
 

	
25


	
Section 3.10

	
Covenants of the Issuer (not Covenants of
  the Owner Trustee)

	
 

	
25


	
Section 3.11

	
Master Servicer’s Obligations

	
 

	
26


	
Section 3.12

	
Restricted Payments

	
 

	
26


	
Section 3.13

	
Treatment of Notes as Debt for All
Purposes

	
 

	
26


	
Section 3.14

	
Notice of Events of Default

	
 

	
26


	
Section 3.15

	
Further Instruments and Acts

	
 

	
26


	
Section 3.16

	
Issuer May Consolidate, etc

	
 

	
27


	
Section 3.17

	
Successor or Transferee

	
 

	
28


	
Section 3.18

	
No Other Business

	
 

	
29


	
Section 3.19

	
No Borrowing

	
 

	
29


	
Section 3.20

	
Guarantees Loans Advances and Other
  Liabilities

	
 

	
29


	
Section 3.21

	
Capital Expenditures

	
 

	
29


	
Section 3.22

	
Validity of Notes

	
 

	
29










	
 

	
 

	
 

	
 


	
ARTICLE IV SATISFACTION AND DISCHAGE

	
 

	
30


	
Section 4.1

	
Satisfaction
  and Discharge of Indenture

	
 

	
30


	
Section 4.2

	
Application
  of Trust Money

	
 

	
31


	
Section 4.3

	
Subrogation
  and Cooperation

	
 

	
32


	
Section 4.4

	
Repayment of
  Moneys Held by Paying Agent

	
 

	
33


	
 

	
 

	
 


	
ARTICLE V
  REMEDIES

	
 

	
33


	
Section 5.1

	
Events of
  Default

	
 

	
33


	
Section 5.2

	
Acceleration
  of Maturity; Rescission and Annulment

	
 

	
34


	
Section 5.3

	
Collection
  of Indebtedness and Suits for Enforcement by Indenture Trustee

	
 

	
35


	
Section 5.4

	
Remedies;
  Priorities

	
 

	
37


	
Section 5.5

	
Optional
  Preservation of the Trust Estate

	
 

	
38


	
Section 5.6

	
Limitation
  of Suits

	
 

	
39


	
Section 5.7

	
Unconditional
  Rights of Noteholders To Receive Principal and Interest

	
 

	
39


	
Section 5.8

	
Restoration
  of Rights and Remedies

	
 

	
39


	
Section 5.9

	
Rights and
  Remedies Cumulative

	
 

	
40


	
Section 5.10

	
Delay or Omission Not a Waiver

	
 

	
40


	
Section 5.11

	
Control by Noteholders

	
 

	
40


	
Section 5.12

	
Waiver of Past Defaults

	
 

	
40


	
Section 5.13

	
Undertaking for Costs

	
 

	
41


	
Section 5.14

	
Waiver of Stay or Extension Laws

	
 

	
41


	
Section 5.15

	
Action on Notes

	
 

	
41


	
Section 5.16

	
Performance and Enforcement of Certain
  Obligations

	
 

	
42


	
 

	
 

	
 


	
ARTICLE VI
  THE INDENTURE TRUSTEE

	
 

	
42


	
Section 6.1

	
Duties of
  Indenture Trustee

	
 

	
42


	
Section 6.2

	
Rights of
  Indenture Trustee

	
 

	
44


	
Section 6.3

	
Individual
  Rights of Indenture Trustee

	
 

	
46


	
Section 6.4

	
Indenture
  Trustee’s Disclaimer

	
 

	
46


	
Section 6.5

	
Notice of
  Defaults

	
 

	
46


	
Section 6.6

	
Reports by
  Indenture Trustee to Holders

	
 

	
46


	
Section 6.7

	
Compensation
  and Indemnity

	
 

	
46


	
Section 6.8

	
Replacement
  of Indenture Trustee

	
 

	
47


	
Section 6.9

	
Successor
  Indenture Trustee by Merger

	
 

	
48


	
Section 6.10

	
Appointment of Co-Indenture Trustee or
  Separate Indenture Trustee

	
 

	
48


	
Section 6.11

	
Eligibility: Disqualification

	
 

	
50


	
Section 6.12

	
Preferential Collection of Claims Against
  Issuer

	
 

	
50


	
Section 6.13

	
Representations and Warranties

	
 

	
50


	
Section 6.14

	
Directions to Indenture Trustee

	
 

	
50


	
Section 6.15

	
Indenture Trustee To Act Solely with
  Consent of the Insurer

	
 

	
51


	
Section 6.16

	
Mortgage Loans, Trust Estate and Accounts
  Held for Benefit of the Insurer

	
 

	
51


	
 

	
 

	
 


	
ARTICLE VII
  NOTEHOLDERS’ LISTS AND REPORTS

	
 

	
51


	
Section 7.1

	
Issuer To
  Furnish Indenture Trustee Names and Addresses of Noteholders

	
 

	
51


	
Section 7.2

	
Preservation
  of Information; Communications to Noteholders

	
 

	
51


	
Section 7.3

	
Reports by
  Issuer

	
 

	
52


	
Section 7.4

	
Reports by
  Indenture Trustee

	
 

	
52










	
 

	
 

	
 

	
 


	
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES

	
 

	
52


	
Section 8.1

	
Collection
  of Money

	
 

	
52


	
Section 8.2

	
Accounts,
  Distributions

	
 

	
53


	
Section 8.3

	
[Reserved]

	
 

	
53


	
Section 8.4

	
Master
  Servicer’s Monthly Statements

	
 

	
53


	
Section 8.5

	
[Reserved]

	
 

	
54


	
Section 8.6

	
Opinion of
  Counsel

	
 

	
54


	
 

	
 

	
 


	
ARTICLE IX
  SUPPLEMENTAL INDENTURES

	
 

	
54


	
Section 9.1

	
Supplemental
  Indentures Without Consent of Noteholders

	
 

	
54


	
Section 9.2

	
Supplemental
  Indentures with Consent of Noteholders

	
 

	
56


	
Section 9.3

	
Execution of
  Supplemental Indentures

	
 

	
57


	
Section 9.4

	
Effect of
  Supplemental Indenture

	
 

	
57


	
Section 9.5

	
Conformity
  with Trust Indenture Act

	
 

	
57


	
Section 9.6

	
Reference in
  Notes to Supplemental Indentures

	
 

	
57


	
 

	
 

	
 


	
ARTICLE X
  REDEMPTION OF NOTES

	
 

	
57


	
Section 10.1

	
Redemption

	
 

	
57


	
 

	
 

	
 


	
ARTICLE XI
  MISCELLANEOUS

	
 

	
58


	
Section 11.1

	
Compliance Certificates and Opinions, etc

	
 

	
58


	
Section 11.2

	
Form of Documents Delivered to Indenture
  Trustee

	
 

	
59


	
Section 11.3

	

Acts of Noteholders

	
 

	
60


	
Section 11.4

	
Notices

	
 

	
61


	
Section 11.5

	
Notices to Noteholders, Waiver

	
 

	
61


	
Section 11.6

	
Rights of the Insurer to Exercise Rights of
  Noteholders

	
 

	
62


	
Section 11.7

	
Conflict with Trust Indenture Act

	
 

	
62


	
Section 11.8

	
Effect of Headings and Table of Contents

	
 

	
62


	
Section 11.9

	
Successors and Assigns

	
 

	
62


	
Section 11.10

	
Separability

	
 

	
63


	
Section 11.11

	
Benefits of Indenture

	
 

	
63


	
Section 11.12

	
Legal Holidays

	
 

	
63


	
Section 11.13

	
GOVERNING LAW

	
 

	
63


	
Section 11.14

	
Counterparts

	
 

	
63


	
Section 11.15

	
Recording of Indenture

	
 

	
63


	
Section 11.16

	
Trust Obligation

	
 

	
63


	
Section 11.17

	
No Petition

	
 

	
64


	
Section 11.18

	
Inspection

	
 

	
64


	
Section 11.19

	
Inconsistencies With the Sale and Servicing
  Agreement

	
 

	
64


	
Section 11.20

	
Third Party Beneficiaries

	
 

	
64










          INDENTURE
dated as of June 1, 2007 between First Horizon ABS Trust 2007-HE1, a Delaware
statutory trust (the “Issuer”) and The Bank of New York, a New York banking
corporation, as trustee and not in its individual capacity (the “Indenture
Trustee”).


          Each
party agrees as follows for the benefit of the other party and for the equal
and ratable benefit of the holders of the Issuer’s First Horizon HELOC Notes,
Series 2007-HE1 (the “Notes”) and the Insurer:


GRANTING CLAUSE


          The
issuer hereby Grants to the Indenture Trustee for the benefit of the
Noteholders and the Insurer, all of the Issuer’s right, title and interest, now
owned or hereinafter acquired, in and to: (i) the Trust Estate; (ii) the Sale
and Servicing Agreement and the Mortgage Loan Purchase Agreement with respect
to the Mortgage Loans (including the Issuer’s right to cause the Seller to
repurchase Mortgage Loans from the Issuer under certain circumstances described
therein); (iii) all present and future claims, demands, causes of action and
choses in action in respect of any or all of the foregoing and all payments on
or under and all proceeds of every kind and nature whatsoever in respect of any
or all of the foregoing, including all proceeds of the conversion thereof,
voluntary or involuntary, into cash or other liquid property, all cash
proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel
paper, instruments, documents, checks, deposit accounts, investment property,
insurance proceeds, condemnation awards, rights to payment of any and every
kind and other forms of obligations and receivables, instruments and other
property which at any time constitute all or part of or are included in the
proceeds of any of the foregoing; (iv) the Collection Account, the Distribution
Account and all funds and other property on deposit from time to time therein;
(v) all other money, investments, investment property, accounts, general
intangibles and other property of the Trust from time to time; and (vi) any and
all proceeds of the foregoing (collectively the “Collateral”).


          The
foregoing Grant is made in trust to secure the payment of principal of and
interest on, and any other amounts owing in respect of, the Notes, equally and
ratably without prejudice, priority or distinction, and to secure compliance
with the provisions of this Indenture, all as provided in this Indenture.


          The
Indenture Trustee, as Indenture Trustee on behalf of the holders of the Notes
and the Insurer, acknowledges the foregoing Grant, accepts the trusts hereunder
in good faith and without notice of any adverse claim or liens and agrees to
perform its duties required in this Indenture to the best of its ability to the
end that the interests of the holders of the Notes and the Insurer may be
adequately and effectively protected. The Indenture Trustee further agrees and
acknowledges that the documents listed in Section 2.01(b) of the Sale and
Servicing Agreement for each Mortgage Loan will be held initially by the Seller
as custodian and bailee and that each item of Collateral that is
physically delivered to the Indenture Trustee will be held by the Indenture Trustee in the State of
New York and/or the State of California.


ARTICLE I

DEFINITIONS


          Section
1.1 Definitions.






	
 

	
 


	
 

	
          (a)
  For all purposes of this Indenture, except as otherwise expressly provided
  herein or unless the context otherwise requires, capitalized terms not
  otherwise defined herein shall have the meanings assigned to such terms in
  the Sale and Servicing Agreement. All other capitalized terms used herein
  shall have the meanings specified herein.





          Act:  As specified in Section 11.3(a).


          Administration
Agreement: The Administration Agreement dated as of June 1, 2007, among the
Administrator, the Issuer, the Indenture Trustee and the Seller.


          Administrator:  The Bank of New York, a New York
banking
corporation, in its capacity as administrator under the Administration
Agreement, or any successor appointed in accordance with the terms of the
Administration Agreement.


          Affiliate:
With respect to any Person, any other Person controlling, controlled by or
under common control with a Person. For the purposes of this definition,
“control” means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise and “controlling” and “controlled” shall have meanings
correlative to the foregoing.


          Authorized
Officer:  With respect to the
Issuer, any officer of the Owner Trustee who is authorized to act for the Owner
Trustee in matters relating to the Issuer and who is identified on the list of
Authorized Officers delivered by the Owner Trustee to the Indenture Trustee on
the closing Date (as such list may be
modified or supplemented from time to time thereafter) and, so long as
the Administration Agreement is in effect, any Vice President or more senior
officer of the Administrator who is authorized to act for the Administrator or
in matters relating to the Issuer and to be acted upon by the Administrator
pursuant to the Administration Agreement and who is identified on the list of
Authorized Officers delivered by the Administrator to the Indenture Trustee on
the Closing Date (as such list may be modified or supplemented from time to
time thereafter).


          Book-Entry
Note:  Any Note registered in the
name of the Depository or its nominee,
ownership of a security entitlement with respect to which is reflected on the
books of the Depository or on the books of a Person maintaining an
account with such Depository (directly or as an indirect participant in
accordance with the rules of such Depository).


          Business Day:  As defined in the Sale and
Servicing Agreement.


          Certificate of Trust:  The
certificate of trust of the Issuer substantially in the form of Exhibit A to
the Trust Agreement.


          Clearing Agency:  An organization registered as a
“clearing agency” pursuant to Section 17A of the Exchange Act.


          Clearing Agency Participant:  A broker,
dealer, bank, other financial institution or other Person for whom from time to
time a Clearing Agency effects book entry transfers and pledges of securities
deposited with the Clearing Agency.






          Closing Date:  June 28, 2007.


          Code:
The Internal Revenue Code of 1986, as amended from time to time, and Treasury
Regulations promulgated thereunder.


          Collateral:  As defined in the Granting
Clause of this Indenture.


          Commission:  The
Securities and Exchange Commission.


          Corporate Trust Office:  The
principal office of the Indenture Trustee at which at any particular time its
corporate trust business shall be administered, which office at date of
execution of this Agreement is located at 101 Barclay Street, 4W, New York, New
York 10286, Attention: Corporate Trust Mortgage-Backed Securities Group, First
Horizon ABS Trust 2007-HE1, or at such other address as the Indenture Trustee
may designate from time to time by notice to the Noteholders, the Issuer and
the Insurer or the principal corporate trust office of any successor Indenture
Trustee at the address designated by such successor Indenture Trustee by notice
to the Noteholders, the Insurer, and the Issuer.


          Default:  Any occurrence that is, or with notice or
the lapse of time or both would become, an Event of Default.


          Definitive Notes:  As specified in Article
11.


          Depositor:  First Horizon Asset Securities
Inc., a Delaware corporation, in its capacity as depositor under the Sale and
Servicing Agreement, and its successor in interest.


          Depository
Institution:  Shall mean either (1)
a depository institution or trust company (which may be the Indenture Trustee)
organized under the laws of the United States or any one of the States thereof,
including the District of Columbia (or any domestic branch of a foreign bank)
which at all times (a) has a short-term unsecured debt rating of “P-1” by
Moody’s, (b) has a short-term unsecured debt rating of “A-1” by Standard &
Poor’s and (c) has its accounts fully insured by the FDIC or maintains trust
accounts in a fiduciary capacity, or (2) any other institution that is
acceptable to each Rating Agency; provided, however, that if such other
institution does not satisfy the rating criteria set forth in clause (1), such
other institution shall also be acceptable to the Insurer.


          Distribution
Account:  The Distribution Account
(as defined in the Sale and Servicing Agreement), established by the Indenture
Trustee.


          ERISA:
The Employee Retirement Income Security Act of 1974, as amended. Event of
Default: As defined in Section 5.1.


          Exchange
Act: The Securities Exchange Act of 1934, as amended.


          Executive
Officer: With respect to any corporation, the Chief Executive Officer,
Chief operating officer, Chief Financial Officer, President, Executive Vice
President, any Vice President, the Secretary or the Treasurer of such
corporation; and with respect to any partnership, any general partner thereof.






          Final
Payment Date:  With respect to any
Note, the Payment Date in September 2029.


          Grant:  Means mortgage, pledge, bargain, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a lien
upon and a security interest in and right of set off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the Collateral shall include
all rights, powers and options (but none of the obligations) of the granting
party thereunder, including the immediate and continuing right to claim for,
collect, receive and give receipt for principal and interest payments in
respect of the Collateral and all other moneys payable thereunder, to give and
receive notices and other communications, to make waivers or other agreements,
to exercise all rights and options, to bring Proceedings in the name of the
granting party or otherwise, and generally to do and receive anything that the
granting party is or may be entitled to do or receive thereunder or with
respect thereto.


          Holder
or Noteholder:  The Person in whose
name a Note is registered on the Note Register.


          Indenture
Trustee:  The Bank of New York, a
New York banking corporation, as Indenture Trustee under this Indenture, or any
successor Indenture Trustee appointed pursuant to the terms of this Indenture.


          Independent:  When used with respect to any
specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor on the Notes, the Transferor and any Affiliate of any of the foregoing
Persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other obligor, the
Transferor or any Affiliate of any of the foregoing Persons and (c) is not
connected with the Issuer, any such other obligor, the Transferor or any
Affiliate of any of the foregoing Persons as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.


          Independent
Certificate:  A certificate or
opinion to be delivered to the Indenture Trustee under the circumstances
described in, and otherwise complying with, the applicable requirements of
Section 11.1 herein, made by an Independent appraiser or other expert appointed
by an Issuer Order and approved by the Indenture Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that the signer
has read the definition of “Independent” in this Indenture and that the signer
is Independent within the meaning thereof.


          Insurance
and Indemnity Agreement:  As defined
in the Sale and Servicing Agreement. 


          Insurance
Policy:  As defined in the Sale and
Servicing Agreement.


          Insurer:
As defined in the Sale and Servicing Agreement.


          Insurer
Default:  As defined in the Sale and
Servicing Agreement.


          Interest
Accrual Period:  As defined in the
Sale and Servicing Agreement.






          Issuer:  First Horizon ABS Trust 2007-HE1 until a
successor replaces it in accordance with the terms of the Transaction Documents
and, thereafter, means the successor.


          Issuer
Order and Issuer Request: A written order or request signed in the name of
the Issuer by any one of its Authorized Officers and delivered to the Indenture
Trustee.


          LIBOR:
As defined in the Sale and Servicing Agreement.


          LIBOR
Business Day: As defined in the Sale and Servicing Agreement. Moody’s:
Moody’s Investors Service, Inc., or any successor thereto.


          Master
Servicer:  First Tennessee Bank
National Association, in its capacity as master servicer under the Sale and
Servicing Agreement, or any Successor Master Servicer appointed in accordance
with the terms of the Sale and Servicing Agreement.


          Mortgage
Loan Schedule: With respect to the Cut-Off Date, the schedule of Mortgage
Loans constituting assets of the Trust. The Mortgage Loan Schedule is the
schedule set forth herein as Schedule A, which schedule sets forth as to each
Mortgage Loan: (i) the Cut-Off Date Principal Balance, (ii) the account number,
(iii) the Credit Limit, (iv) the CLTV as of the date of the origination of the
related Mortgage Loan, (v) occupancy and loan purpose, (vi) the Loan Rate as of
the Cut-Off Date, (vii) the Margin, (viii) the type of property, (ix) the
debt-to-income ratio, and (x) the FICO score. Terms used in this definition and
not defined in this Indenture have the meanings assigned thereto in the Sale
and Servicing Agreement and if not defined in the Sale and Servicing Agreement,
the meanings assigned thereto in the Mortgage Loan Purchase Agreement.


          Note:  Any of the First Horizon HELOC Notes, Series
2007-HE1, executed by the Issuer and
authenticated by the Indenture Trustee substantially in the form of Exhibit A
hereto.


          Note
Depository Agreement:  The agreement
dated June [__], 2007, among the Issuer, the Indenture Trustee and The
Depository Trust Company, as the initial Clearing Agency, relating to the
Book-Entry Notes.


          Note
Owner:  With respect to a Book Entry
Note, the Person who is the owner of a security entitlement with respect to
such Book Entry Note, as reflected on the books of the Clearing Agency or on
the books of a Person maintaining an account with such Clearing Agency
(directly as a Clearing Agency Participant or as an indirect participant, in
each case in accordance with the rules of such Clearing Agency).


          Note Rate:  As defined in the Sale and
Servicing Agreement.


          Note
Register and Note Registrar:  Each
as defined in Article II. 


          Obligations:
The Mortgage Loans.


          Officer’s
Certificate:  A certificate signed
by any Authorized Officer of the Issuer, under the circumstances described in,
and otherwise complying with, the applicable requirements of Section 11.1
herein, and delivered to the Indenture Trustee. Unless otherwise 






specified, any
reference in this Indenture to an Officer’s Certificate shall be to an
Officer’s Certificate of any Authorized Officer of the Issuer.


          Opinion
of Counsel:  One or more written
opinions of counsel who may, except as otherwise expressly provided in this
Indenture, be employees of or counsel to the Issuer and who shall be
satisfactory to the Indenture Trustee and the Insurer, and which opinion or
opinions shall be addressed to the Indenture Trustee and the Insurer, as
Indenture Trustee and the Insurer, respectively, and shall comply with any
applicable requirements of Section 11.1 herein and shall be in form and
substance satisfactory to the Indenture Trustee and the Insurer.


          Outstanding:  With respect to any Note and as of
the date
of determination, any Note theretofore authenticated and delivered under this
Indenture except:


	
 

	
 


	
 

	
          (i)
  Notes theretofore canceled by the Note Registrar or delivered to the Note
  Registrar for cancellation;


	
 

	
 


	
 

	
          (ii)
  Notes or portions thereof the payment for which money in the necessary amount
  has been theretofore deposited with the Indenture Trustee or any Paying Agent
  in trust for the Holders of such Notes (provided, however, that if such Notes
  are to be redeemed, notice of such redemption has been duly given pursuant to
  this Indenture or provision for such notice has been made, satisfactory to
  the Indenture Trustee);


	
 

	
 


	
 

	
          (iii)
  Notes in exchange for or in lieu of which other Notes have been authenticated
  and delivered pursuant to this Indenture unless proof satisfactory to the
  Indenture Trustee is presented that any such Notes are held by a protected
  purchaser; and


	
 

	
 


	
 

	
          (iv)
  Notes for which the Final Payment Date has occurred;





provided,
however, in determining whether the Holders of the requisite Outstanding Amount
of the Notes have given any request, demand, authorization, direction, notice,
consent, or waiver hereunder or under any Transaction Document, Notes owned by
the Issuer, any other obligor upon the Notes,
the Depositor, the Transferor or any Affiliate of any of the foregoing
persons shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Indenture Trustee shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent, or waiver,
only Notes that a Responsible Officer of the Indenture Trustee knows to be so
owned shall be so disregarded and provided
further that for purposes of determining the Insurer’s subrogation rights, a
Note shall be deemed Outstanding to the extent of any payment made by
the Insurer that has not been reimbursed. Notes so owned that have been pledged
in good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Indenture Trustee the pledgee’s right so to act with respect to such Notes and that the pledgee is not
the Issuer, any other obligor upon the Notes, the Transferor or any
Affiliate of any of the foregoing Persons.


          Outstanding
Amount:  The aggregate principal
amount of all Notes Outstanding at the date of determination.






          Owner
Trustee:  Wilmington Trust Company,
a Delaware banking corporation, not in its individual capacity but solely as
Owner Trustee under the Trust Agreement.


          Paving
Agent:  The Indenture Trustee or any
other Person that meets the eligibility standards for the Indenture Trustee
specified in Section 6.11 of the Sale and Servicing Agreement and is authorized
by the Issuer to make payments to and distributions from the Distribution
Account, including payment of principal of or interest on the Notes on behalf
of the Issuer.


          Payment
Date:  The 25th day of each month
or, if such day is not a Business Day, then the next Business Day, beginning in
July 2007.


          Person:  Any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization, limited partnership,
limited liability company, limited liability partnership, or government or any
agency or political subdivision thereof.


          Predecessor
Note:  With respect to any
particular Note, every previous Note evidencing all or a portion of the same
debt as that evidenced by such particular Note; and, for the purpose of this
definition, any Note authenticated and delivered under Article II in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.


          Proceeding:  Any suit inequity, action at law or
other
judicial or administrative proceeding.


          Rating
Agency Condition:  With respect to
certain actions requiring prior Rating Agency consent, that each Rating Agency
shall have been given 10 days (or such shorter period as is acceptable to each
Rating Agency) prior notice thereof and that each of the Rating Agencies shall
have notified the Issuer, the Master Servicer, the Indenture Trustee and the
Insurer in writing that such action will not result in a reduction or
withdrawal of the then current rating of the Notes without regard to the
Insurance Policy.


          Rating
Agency:  Either of (i) Moody’s or
(ii) Standard & Poor’s. If no such organization or successor is any longer
in existence, “Rating Agency” shall be a nationally recognized statistical
rating organization or other comparable person designated by the Master
Servicer and the insurer, notice of which designation shall have been given to
the Indenture Trustee.


          Record
Date:  As defined in the Sale and
Servicing Agreement.


          Redemption
Date:  In the case of a redemption
of the Notes pursuant to Section 10.1, the Payment Date specified by the
Indenture Trustee pursuant to Section 10.1.


          Registered
Holder:  The Person in whose name a
Note is registered on the Note Register on the applicable Record Date.


          Responsible
Officer:  As defined in the Sale and
Servicing Agreement.






          Sale
and Servicing Agreement:  The Sale
and Servicing Agreement dated as of June 1, 2007, among the Seller, the
Depositor, the Issuer, the Master Servicer and the Indenture Trustee.


          Securities
Act:  The Securities Act of 1933, as
amended.


          Standard
& Poor’s:  Standard & Poor’s
Ratings Services, a division of The McGraw Hill Companies, Inc.


          State:  Any one of the 50 States of the United
States of America or the District of Columbia.


          Successor
Master Servicer:  As defined in
Section 3.7(e) hereof.


          Transaction
Documents:  As defined in the Sale
and Servicing Agreement. 


          Transferor:
As defined in the Trust Agreement.


          Trust:  The Issuer.


          Trust
Estate:  The assets subject to the
Sale and Servicing Agreement, the Mortgage Loan Purchase Agreement, the Trust Agreement
and the lien and security interest of this Indenture, which assets consist of:
(i) each Mortgage Loan and the related Mortgage File, including its Principal
Balance (including all Additional Balances resulting from Draws made pursuant
to the related Mortgage Note prior to the termination of the Trust) and all
collections in respect of interest and principal received after the Cut-Off
Date; (ii) property that secured a Mortgage Loan that has become REO Property;
(iii) the Seller’s rights under any insurance policies maintained by the
Mortgagors or the Master Servicer in respect of the Mortgage Loans (including
any Insurance Proceeds); (iv) such other assets as shall from time to time be
identified as on deposit in the Collection Account and Distribution Account in
accordance with the Sale and Servicing Agreement; (v) the Depositor’s rights
under the Mortgage Loan Purchase Agreement; (vi) the benefit of the Insurance
Policy and the proceeds of any draw thereunder; (vii) any proceeds of any of
the foregoing (i) through (vi); and (viii) all other assets included or to be
included in the Trust for the benefit of Noteholders and the Insurer. In
addition, on or prior to the Closing Date, the Seller shall cause the Insurer
to deliver the Insurance Policy to the Indenture Trustee for the benefit of the
Noteholders. Terms used in this definition and not defined in this Indenture
have the meanings assigned thereto in the Sale and Servicing Agreement.


          Trust
Indenture Act or TIA:  The Trust
Indenture Act of 1939 as in force on the date hereof, unless otherwise
specifically provided.


          UCC:  Unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction from time to
time.


          Section
1.2 Incorporation by Reference of Trust Indenture Act.  Whenever this Indenture refers to a provision of
the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:






          Commission:  The Securities and Exchange
Commission.


          indenture
securities:  The Notes.


          indenture
security holder:  A Noteholder.


          indenture
to be qualified:  This Indenture.


          indenture
trustee or institutional trustee:
The Indenture Trustee.


          obligor:  On the indenture securities means the
Issuer
and any other obligor on the indenture securities.


All other TIA terms used in this Indenture that are
defined in the TIA, defined by TIA reference
to another statute or defined by Commission rule have the meaning assigned to
them by such definitions.


          Section
1.3 Rules of Construction.
Unless the context otherwise requires:


	
 

	
 


	
 

	
          (i)
  a term has the meaning assigned to it;


	
 

	
 


	
 

	
          (ii)
  an accounting term not otherwise defined has the meaning assigned to it in
  accordance with generally accepted accounting principles as in effect from
  time to time;


	
 

	
 


	
 

	
          (iii)
  “or” is not exclusive;


	
 

	
 


	
 

	
          (iv)
  “including” means including without limitation;


	
 

	
 


	
 

	
          (v)
  words in the singular include the plural and words in the plural include the
  singular; and


	
 

	
 


	
 

	
          (vi)
  any agreement, instrument or statute defined or referred to herein or in any
  instrument or certificate delivered in connection herewith means such
  agreement, instrument or statute as from time to time amended, modified or
  supplemented (as provided in such agreements) and includes (in the case of
  agreements or instruments) references to all attachments thereto and
  instruments incorporated therein; references to a Person are also to its
  permitted successors and assigns.





ARTICLE II

THE NOTES


          Section
2.1 Form.  The Notes shall be
designated as the “First Horizon ABS Trust 2007-HE1, First Horizon HELOC Notes,
Series 2007-HE1”. Each Note shall be in substantially the form set forth in
Exhibit A with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this
Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements
placed thereon as may, consistently herewith, be determined by the
officers executing such Notes, as evidenced 






by their execution thereof. Any portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate
reference thereto on the face of such Note.


The Definitive
Notes shall be typewritten, printed, lithographed or engraved or produced by
any combination of these methods, all as determined by the officers executing
such Definitive Notes, as evidenced by their execution of such Definitive
Notes.


The terms of
the Notes are set forth in Exhibit A hereto. The terms of the Notes are part of
the terms of this Indenture.


          Section
2.2 Execution, Authentication, Delivery and Dating.  The Notes shall
be executed on behalf of the Issuer by an Authorized Officer of the Owner
Trustee. The signature of any such Authorized Officer on the Notes may
be manual or facsimile.


          Notes
bearing the manual or facsimile signature of individuals who were at any time Authorized Officers of the
Owner Trustee shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold
such offices prior to the authentication and delivery of such Notes or did not hold such
offices at the date of such Notes.


          The
Indenture Trustee shall upon receipt of an Issuer Order, authenticate and
deliver the Notes for original issue in the principal amount equal to
$307,000,000. The aggregate principal amount of the Notes outstanding at any
time may not exceed such amount.


          The
Notes that are authenticated and delivered by the Indenture Trustee to or upon
the order of the Issuer on the Closing Date shall be dated June 28, 2007.  All other Notes that are authenticated after
the Closing Date for any other purpose under the Indenture shall be dated the
date of their authentication. The Notes shall be issuable as registered Notes
in the minimum denomination of $25,000 and multiples of $1,000 in excess
thereof.


          No
Note shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose, unless there appears on such Note a certificate of
authentication substantially in the form provided for herein executed by the
Indenture Trustee by the manual signature of one of its authorized signatories,
and such certificate upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder.


          Section
2.3 Registration; Registration of Transfer and Exchange.  The Issuer shall cause to be kept a register
(the “Note Register”) in which, subject to such reasonable regulations
as it may prescribe, the Issuer shall provide for the registration of Notes and
the registration of transfers of Notes. The Indenture Trustee initially shall
be the “Note Registrar” for the purpose of registering Notes and transfers of
Notes as herein provided. Upon any resignation of any Note Registrar, the
Issuer shall promptly appoint a successor or, if it elects not to make such an
appointment, assume the duties of the Note Registrar.


          If
a Person other than the Indenture Trustee is appointed by the Issuer as Note
Registrar, the Issuer will give the Indenture Trustee and the Insurer prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and
to obtain copies thereof, and the Indenture Trustee shall have the right to
rely upon a certificate executed on behalf of the Note Registrar by an
Executive Officer thereof 






as to the
names and addresses of the Holders of the Notes and the principal amounts and number
of such Notes.


          Upon
surrender for registration of transfer of any Note at the office or agency of
the Issuer to be maintained as provided in Section 3.2 hereof, the Owner
Trustee on behalf of the Issuer shall execute, and the Indenture Trustee shall
authenticate and the Noteholder shall obtain from the Indenture Trustee, in the
name of the designated transferee or transferees, one br more new Notes in any
authorized denominations, of a like aggregate principal amount.


          At
the option of the Holder, Notes may be exchanged for other Notes in any
authorized denominations, of a like aggregate principal amount, upon surrender
of the Notes to be exchanged at such office or agency. Whenever any Notes are
so surrendered for exchange, the Issuer shall execute, and the Indenture
Trustee shall authenticate and the Noteholder shall obtain from the Indenture
Trustee, the Notes which the Noteholder making the exchange is entitled to
receive.


          All
Notes issued upon any registration of transfer or exchange of Notes shall be
the valid obligations of the Issuer, evidencing the same debt, and entitled to
the same benefits under this Indenture, as the Notes surrendered upon such
registration of transfer or exchange.


          Every
Note presented or surrendered for registration of transfer or exchange shall be
duly endorsed by, or be accompanied by a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by, the Holder thereof or
such Holder’s attorney duly authorized in writing, with such signature
guaranteed by an “eligible guarantor institution” meeting the requirements of
the Note Registrar, which requirements include membership or participation in
the Securities Transfer Agent’s Medallion Program (“STAMP”) or such other
“signature guarantee program” as may be determined by the Note Registrar in
addition to, or in substitution for, STAMP, all in accordance with the Exchange
Act.


          No
service charge shall be made to a Holder for any registration of transfer or
exchange of Notes, but the Issuer may require payment of a sum sufficient to
cover. any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Notes, other than exchanges
pursuant to Section 2.4 or Section 9.6 hereof not involving any transfer.


          By
acquiring a Note, each purchaser and transferee shall be deemed to represent
and warrant that either (a) it is not acquiring the Note with the plan assets
of an “employee benefit plan” as defined in Section 3(3) of ERISA, whether or
not subject to Title I of ERISA, or a “plan” as defined in Section 4975(e)(1)
of the Code whether or not subject to Section 4975 of the Code, or any entity
deemed to hold the “plan assets” of the foregoing; or (b) the acquisition and
holding of the Note will not give rise to a non-exempt prohibited transaction
under Section 406(a) of ERISA or Section 4975 of the Code which is not eligible
for exemptive relief under Prohibited Transaction Class Exemption (“ PTCE”)
84-14, PTCE 90-1, PTCE 91-38, PTCE 95-60, PTCE 96-23 or a similar prohibited
transaction exemption and does not cause a non-exempt violation of any
substantially similar laws.


          Section
2.4 Mutilated, Destroyed, Lost or Stolen Notes.






	
 

	
 


	
 

	
          (i)
  any mutilated Note is surrendered to the Indenture Trustee, or the Indenture
  Trustee receives evidence to its satisfaction of the destruction, loss or
  theft of any Note, and


	
 

	
 


	
 

	
          (ii)
  there is delivered to the Indenture Trustee such security or indemnity as
  may be reasonably required by it to hold the Issuer and the Indenture Trustee
  harmless,





then, in the
absence of notice to the Issuer, the Note Registrar or the Indenture Trustee
that such Note has been acquired by a protected purchaser, an Authorized
Officer of the Owner Trustee shall execute, and upon request the Indenture
Trustee shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Note, a replacement Note; provided,
however, that if any such destroyed, lost or stolen Note, but not a mutilated
Note, shall have become or within seven days shall be due and payable, or shall
have been called for redemption, instead of issuing a replacement Note, the
Issuer may pay such destroyed, lost or stolen Note when so due or payable or
upon the Redemption Date without surrender thereof.  If, after the delivery of such replacement.  Note or payment of a destroyed,
lost or
stolen Note pursuant to the proviso to the preceding sentence, a protected purchaser
of the original Note in lieu of which such replacement Note was issued presents
for payment such original Note, the Issuer and the Indenture Trustee shall be
entitled to recover such replacement Note (or such payment) from the Person to
whom it was delivered or any Person taking such replacement Note from such
Person to whom such replacement Note was delivered or any assignee of such
Person, except a protected purchaser, and shall be entitled to recover upon the
security or indemnity provided therefor to the extent of any loss, damage, cost
or expense incurred by the Issuer or the Indenture Trustee in connection
therewith. The calculation of Insured Payments shall be made without regard to
the issuance of any replacement Note.


          Upon
the issuance of any replacement Note under this Section 2.4, the Issuer may
require the payment by the Holder of such Note of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and
any other reasonable expenses (including the fees and expenses of the Indenture
Trustee) connected therewith.


          Every
replacement Note issued pursuant to this Section 2.4 in replacement of any
mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.


          The
provisions of this Section 2.4 are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.


          Section
2.5 Persons Deemed Owner.  Prior to
due presentment for registration of transfer of any Note, the Issuer,
the Indenture Trustee and any agent of the Issuer or the Indenture Trustee may treat the Person in whose name any
Note is registered (as of the day of
determination) as the owner of such Note for the purpose of receiving payments of principal
of and interest on, if any, such Note and for all other purposes whatsoever, whether
or not 






such Note be
overdue, and none of the Issuer, the Indenture Trustee or any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.


          Section
2.6 Payment of Principal and Interest.


	
 

	
 


	
 

	
          (a)
  Each Note shall accrue interest at the Note Rate and such interest shall be payable
  on each Payment Date as specified in Exhibit A hereto, subject to Section 3.1
  hereof. Any installment of interest or principal, if any, payable on any Note
  that is punctually paid or duly provided
  for by the Issuer on the applicable Payment Date shall be paid to
  the Person in whose name such Note (or one or more Predecessor Notes) is registered on the Record Date in the
  manner set forth in Section 5.01(c) of the Sale and Servicing Agreement.


	
 

	
 


	
 

	
          (b)
  The principal of each Note shall be payable in installments on each Payment
  Date as provided in the forms of the Notes set forth in Exhibit A hereto.
  Notwithstanding the foregoing, the entire unpaid principal amount of the
  Notes shall be due and payable, if not previously paid, on the earliest of
  (i) the Final Payment Date, (ii) the Redemption Date or (iii) the date on
  which an Event of Default shall have occurred and be continuing, if the Notes
  shall have been declared or otherwise shall become immediately due and
  payable in the manner provided in Section 5.2 below. All principal payments
  on the Notes shall be in the manner set forth in the Sale and Servicing
  Agreement. The Indenture Trustee shall notify the Person in whose name a Note
  is registered at the close of business on the Record Date preceding the
  Payment Date on which the Issuer expects that the final installment of
  principal of and interest on such Note will be paid. Such notice shall be
  mailed or transmitted by facsimile prior to such Final Payment Date and shall
  specify that such final installment will be payable only upon presentation
  and surrender of such Note and shall specify the place where such Note may be
  presented and surrendered for payment of such installment.  Notices in connection with redemptions of
  Notes shall be mailed to Noteholders and the Insurer as provided in Section
  8.01 of the Sale and Servicing Agreement.





          Section
2.7 Cancellation.  All Notes
surrendered for payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than the
Indenture Trustee,
be delivered to the Indenture Trustee
and shall be promptly canceled by the Indenture Trustee.
The Issuer may at any time deliver to the Indenture Trustee for
cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired
in any manner whatsoever, and all Notes so
delivered shall be promptly canceled by the Indenture Trustee. No Notes shall
be authenticated in lieu of or in exchange for any Notes canceled as provided
in this Section, except as expressly permitted by this Indenture. All canceled
Notes may be held or disposed of by the Indenture Trustee in accordance
with its standard retention or disposal policy as in effect at the
time unless the Issuer shall direct
by an Issuer Order that they be destroyed or returned to it; provided,
that such Issuer Order is timely and the
Notes have not been previously disposed of by the Indenture Trustee.


          Section
2.8 [Reserved].


          Section
2.9 Release of Trust Estate.






	
 

	
 


	
 

	
          (a)
  Except as otherwise provided in subsections (b) and (c) of this Section 2.9
  and Section 11.1 hereof and the terms of the Transaction Documents, the
  Indenture Trustee shall release property
  from the lien of this Indenture only upon consent of the Insurer and receipt of an Issuer Request accompanied by an Officer’s
Certificate, an Opinion of Counsel and Independent
  Certificates in accordance with TIA Sections 314(c) and 314(d)(1) or an
  Opinion of Counsel in lieu of such Independent Certificates to the effect
  that the TIA does not require any such Independent Certificates.


	
 

	
 


	
 

	
          (b) The
  Master Servicer, on behalf of the Issuer and with the consent of the Insurer,
  shall be entitled to obtain a release from the lien of this Indenture for any
  Mortgage Loan and the related Mortgaged Property at any time in accordance
  with the provisions of Section 3.08 of the Sale and Servicing Agreement.


	
 

	
 


	
 

	
          (c) The
  Indenture Trustee shall, if requested by the Master Servicer, temporarily
  release to the Master Servicer the Indenture Trustee’s Mortgage File pursuant
  to the provisions of Section 3.08 of the Sale and Servicing Agreement upon
  compliance by the Master Servicer of the provisions thereof provided that the
  Indenture Trustee’s Mortgage File shall have been stamped to signify the
  Issuer’s pledge to the Indenture Trustee under this Indenture.





          Section
2.10 Book-Entry Notes. The Notes, upon original issuance, will be issued
in the form of typewritten Notes representing the Book-Entry Notes, to be
delivered to The Depository Trust Company, the initial Clearing Agency or its
custodian, by, or on behalf of, the Issuer. The Book-Entry Notes shall be
registered initially on the Note Register in the name of Cede & Co., the
nominee of the initial Clearing Agency, and no Note Owner thereof will receive
a definitive Note representing such Note Owner’s interest in such Note, except
as provided in Section 2.12 below. Unless and until definitive, fully
registered Notes (the “Definitive Notes”) have been issued to such Note Owners
pursuant to Section 2.12 below:


	
 

	
 


	
 

	
          (i)
  the provisions of this Section shall be in full force and effect;


	
 

	
 


	
 

	
          (ii)
  the Note Registrar and the Indenture Trustee shall be entitled to deal with
  the Clearing Agency for all purposes of this Indenture (including the payment
  of principal of and interest on the Notes and the giving of instructions or
  directions hereunder) as the sole holder of the Notes, and shall have no
  obligation to the Note Owners;


	
 

	
 


	
 

	
          (iii)
  to the extent that the provisions of this Section conflict with any other
  provisions of this Indenture, the provisions of this Section shall control;


	
 

	
 


	
 

	
          (iv)
  the rights of Note Owners shall be exercised only through the Clearing Agency
  and shall be limited to those established by law and agreements between such
  Note Owners and the Clearing Agency and/or the Clearing Agency Participants
  pursuant to the Note Depository Agreement. Unless and until Definitive Notes
  are issued pursuant to Section 2.12 below, the initial Clearing Agency will
  make book entry transfers among the Clearing Agency Participants and receive
  and transmit payments of principal of and interest on the Notes to such
  Clearing Agency Participants; and










	
 

	
 


	
 

	
          (v)
  whenever this Indenture requires or permits actions to be taken based upon
  instructions or directions of Holders of Notes evidencing a specified
  percentage of the Outstanding Amount of the Notes, the Clearing Agency shall
  be deemed to represent such percentage only to the extent that it has
  received instructions to such effect from Note Owners and/or Clearing Agency
  Participants owning or representing, respectively, such required percentage
  of security entitlements with respect to the Notes and has delivered such
  instructions to the Indenture Trustee.





          Section
2.11 Notices to Clearing Agency.
Whenever a notice or other communication to the Noteholders is required
under this Indenture, unless and until Definitive Notes shall have been issued
to such Note Owners pursuant to Section 2.12, the Indenture Trustee shall give
all such notices and communications specified herein to be given to Holders of
the Notes, to the Clearing Agency, and shall have no obligation to such Note
Owners.


          Section
2.12 Definitive Notes.  If (i)
the Clearing Agency or the Issuer advises the Indenture Trustee in writing that
the Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Book Entry Notes and the Clearing Agency
or the Issuer is unable to locate a qualified successor, (ii) the Issuer at its
option advises the Indenture Trustee in writing that it elects to terminate the
book entry system through the Clearing Agency or (iii) after the occurrence of
an Event of Default, Note Owners of security entitlements representing
beneficial interests aggregating at least a majority of the Outstanding Amount
of such Notes advise the Clearing Agency in writing that the continuation of a
book entry system through the Clearing Agency is no longer in the best
interests of such Note Owners, then the Clearing Agency shall notify all Note
Owners and the Indenture Trustee of the occurrence of such event and of the
availability of Definitive Notes to Note Owners requesting the same. Upon
surrender to the Indenture Trustee of the typewritten Notes representing the
Book Entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Indenture
Trustee shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Notes, the Indenture Trustee and the Note
Registrar shall recognize the Holders of the Definitive Notes as Noteholders.


          Section
2.13 Tax Treatment. The Issuer has entered into this Indenture, and the
Notes will be issued, with the intention that, for all tax purposes, the Notes
will qualify as indebtedness secured by the Trust Estate.  The Issuer, by entering into this Indenture,
and each Noteholder, by its acceptance of a Note (and each Note Owner by its
acceptance of a security entitlement with respect to the applicable Book Entry
Note), agree to treat the Notes for all purposes as indebtedness of the Issuer.


ARTICLE III

COVENANTS


          Section
3.1 Payment of Principal and Interest.
The Issuer will duly and punctually pay (or will cause to be duly and
punctually paid) the principal of and interest on the Notes in accordance with
the terms of the Notes and this Indenture.
Without limiting the foregoing, the 






Indenture
Trustee shall, pursuant to Section 5.01 of the Sale and Servicing Agreement,
distribute all amounts on deposit in the Distribution Account on each Payment
Date deposited therein pursuant to the Sale and Servicing Agreement, and held
therein for distribution to the Noteholders and the Insurer for the benefit of
such Noteholders and the Insurer. Amounts properly withheld under the Code by
any Person from a payment to any Noteholder of interest and/or principal shall
be considered as having been paid by the Issuer to such Noteholder for all
purposes of this Indenture.


          The
Notes shall be non-recourse obligations of the Issuer and shall be limited in right of payment to amounts available from the
Trust Estate, as provided in this Indenture.  The Issuer shall not
otherwise be liable for payments on the Notes.
If any other provision of this Indenture shall be deemed to conflict
with the provisions of this Section 3.1, the provisions of this Section 3.1
shall control.


          Section
3.2 Maintenance of Office or Agency.
The Issuer will maintain an office or
agency where Notes may be surrendered for registration of transfer or
exchange, and where notices
and demands to or upon the Issuer in respect of the Notes and this Indenture may be served. The Issuer hereby initially appoints the
Indenture Trustee to
serve as its agent for the
foregoing purposes and to serve as Paying Agent with respect to the Notes. If
at any time the Issuer shall fail to maintain any such office or agency or
shall fail to furnish the Indenture Trustee with the address thereof, such
surrenders, notices and demands may be made or served at the Corporate Trust
Office, and the Issuer hereby appoints the Indenture Trustee as its agent to
receive all such surrenders, notices and demands.


          Section
3.3 Money for Payments To Be Held in Trust.  As provided in Section 8.2(a) and (b), all payments of amounts
due and payable with respect to any Notes
that are to be remitted from amounts withdrawn from the Distribution Account
pursuant to Section 8.2(c) shall be made on behalf of the issuer by the
Indenture Trustee or by the Paying Agent, and
no amounts so withdrawn from the Distribution Account for payments on the Notes
shall be paid over to the Issuer except as provided in this Section 3.3.


          Any
Paying Agent shall be appointed by Issuer Order with written notice thereof to
the Indenture Trustee and the Insurer. Any Paying Agent appointed by the Issuer
shall be a Person who would be eligible to be
Indenture Trustee hereunder as provided in Section 6.11 hereof. The
Issuer shall not appoint any Paying Agent (other than the Indenture Trustee)
which is not, at the time of such appointment, a Depository Institution.


          The Issuer
will cause each Paying Agent to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall
agree with the Indenture Trustee (and
if the Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to
the provisions of this Section 3.3, that such Paying Agent will:


	
 

	
 


	
 

	
          (i)
  hold all sums held by it for the payment of amounts’ due with respect to the
  Notes in trust for the benefit of the Persons entitled thereto until such
  sums shall be paid to such Persons or
  otherwise disposed of as herein provided and pay such sums to such
  Persons as herein provided;


	
 

	
 


	
 

	
          (ii)
  give the Indenture Trustee and the Insurer notice of any default by the issuer (or any other
  obligor upon the Notes) (such notice to be given within three










	
 

	
 


	
 

	
Business
  Days) of which it has actual knowledge in the making of any payment required to be made with
  respect to the Notes;


	
 

	
 


	
 

	
          (iii)
  at any time during the continuance of any such default, upon the written request of the Indenture Trustee or the Insurer,
  forthwith pay to the Indenture Trustee all sums so held in trust by such Paying Agent;


	
 

	
 


	
 

	
          (iv)
  immediately resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums
  held by it in trust for the payment of Notes if at any time it ceases to meet
  the standards required to be met by a Paying Agent at the time of its
  appointment; and


	
 

	
 


	
 

	
          (v)
  comply with all requirements of the Code with respect to the withholding from any payments made
  by it on any Notes of any applicable withholding taxes imposed thereon and with
  respect to any applicable reporting requirements in connection therewith; provided,
  however, that with respect to withholding and reporting requirements
  applicable to original issue discount (if any) on the Notes, the Issuer shall
  have first provided the calculations pertaining thereto to the Indenture
  Trustee.





          The
Issuer may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, by Issuer Order direct
any Paying Agent to pay to the Indenture Trustee all sums held in trust by such
Paying Agent, such sums to be held by the Indenture Trustee upon the same terms
as those upon which the sums were held by such Paying Agent; and upon such
payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall
be released from all further liability with respect to such money.


          Any
termination and release of a Trust Estate shall be done in accordance with the
provisions of Section 8.01 of the Sale and Servicing Agreement.


          Section
3.4 Existence.


	
 

	
 


	
 

	
          (a)
  Subject to Section 3.4(b) below, the Issuer will keep in full effect its
  existence, rights and franchises as a statutory trust under the laws of the
  State of Delaware (unless it becomes, or
  any successor Issuer hereunder is or becomes, organized under the laws of any
  other State or of the United States of America, in which case the
  Issuer will keep in full effect its existence, rights and franchises under
  the laws of such other jurisdiction) and will obtain and preserve its
  qualification to do business in each jurisdiction in which such qualification
  is or shall be necessary to protect the validity and enforceability of this
  Indenture, the Notes and the Trust Estate.


	
 

	
 


	
 

	
          (b)
  Any successor to the Owner Trustee appointed pursuant to Section 10.2 of the
  Trust Agreement shall be the successor Owner Trustee under this Indenture
  without the execution or filing of any paper, instrument or further act to be
  done on the part of the parties hereto.


	
 

	
 


	
 

	
          (c)
  Upon any consolidation or merger of or other succession to the Owner Trustee,
  the Person succeeding to the Owner Trustee under the Trust Agreement may
  exercise every right and power of the Owner Trustee under this Indenture with
  the same effect as if such Person had been named as the Owner Trustee herein.










          Section
3.5 Protection of Trust Estate.
The Issuer will from time to time execute and deliver all such
supplements and amendments hereto and all such financing statements, continuation statements, instruments of further assurance and
other instruments,
and will take such other action necessary or advisable to:


	
 

	
 


	
 

	
          (a)
  provide further assurance with respect to a Grant of all or any portion of
  the related Trust Estate;


	
 

	
 


	
 

	
          (b)
  maintain or preserve the lien and security interest (and the priority
  thereof) of this Indenture or carry out more effectively the purposes hereof;


	
 

	
 


	
 

	
          (c)
  perfect, publish notice of or protect the validity of any Grant made or to be
  made by this Indenture;


	
 

	
 


	
 

	
          (d)
  enforce any rights with respect to the Trust Estate; or


	
 

	
 


	
 

	
          (e)
  preserve and defend title to the Trust Estate and the rights of the Indenture
  Trustee, the Insurer and the Noteholders in such Trust Estate against the
  claims of all persons and parties.





          Section
3.6 Annual Opinions as to the Trust Estate. Within 90 days after the
Issuer’s fiscal year end, beginning with the year 2007, the Issuer shall
furnish to the Indenture Trustee and the Insurer an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording, filing, rerecording and re-filing of this Indenture,
any indentures supplemental hereto and any other requisite documents and with
respect to the execution and filing of any financing statements and
continuation statements as is necessary to maintain perfection of the lien and
security interest created by this Indenture and reciting the details of such
action or stating that in the opinion of such counsel no such action is
necessary to maintain the perfection of such lien and security interest. Such
Opinion of Counsel shall also describe the recording, filing, re-recording and
re-filing of this Indenture, any indentures supplemental hereto and any other
requisite documents and the execution and filing of any financing statements
and continuation statements that will, in the opinion of such counsel, be
required to maintain perfection of the lien and security interest of this Indenture.


          Section
3.7 Performance of Obligations: Servicing of Mortgage Loans.


	
 

	
 


	
 

	
          (a)
  The Issuer will not take any action and will use its best efforts not to
  permit any action to be taken by others that would release any Person from
  any of such Person’s covenants or obligations under any instrument or
  agreement included in the Trust Estate or that would result in the amendment,
  hypothecation, subordination, termination or discharge of, or impair the
  validity or effectiveness of, any such instrument or agreement, except as
  expressly provided in this Indenture, the Sale and Servicing Agreement or
  such other instrument or agreement.


	
 

	
 


	
 

	
          (b)
  The Issuer may contract with or otherwise obtain the assistance of other
  Persons to assist it in performing its duties under this Indenture, and any
  performance of such duties by a Person identified to the Indenture Trustee in
  an Officer’s Certificate of the Issuer shall be deemed to be action taken by
  the Issuer. Initially, the Issuer has 










	
 

	
 


	
 

	
contracted
  with the Administrator to assist the Issuer in performing its duties under
  this Indenture.


	
 

	
 


	
 

	
          (c)
  The Issuer will punctually perform and observe all of its obligations and
  agreements contained in this Indenture, the Transaction Documents and in the
  instruments and agreements included in the Trust Estate, including but not
  limited to (i) filing or causing to be filed all UCC financing statements and
  continuation statements required to be filed by the terms of this Indenture,
  the Mortgage Loan Purchase Agreement and the Sale and Servicing Agreement and
  (ii) recording or causing to be recorded all Mortgages, Assignments of
  Mortgage, all intervening Assignments of Mortgage and all assumption and
  modification agreements required to be recorded by the terms of the Sale and
  Servicing Agreement and the Mortgage Loan Purchase Agreement, in accordance
  with and within the time periods provided for in this Indenture and/or the
  Sale and Servicing Agreement, as applicable. Except as otherwise expressly
  provided therein, the Issuer shall not waive, amend, modify, supplement or
  terminate any Transaction Document or any provision thereof without the
  consent of the Indenture Trustee, the Insurer and the Holders of at least a
  majority of the Outstanding Amount of the Notes. 


	
 

	
 


	
 

	
          (d)
  Subject to the terms of the Sale and Servicing Agreement, if the Issuer shall
  have knowledge of the occurrence of an Event of Servicing Termination under
  the Sale and Servicing Agreement, the Issuer shall promptly notify the
  Indenture Trustee, the Seller, the Depositor, the Insurer, the Master
  Servicer and the Rating Agencies thereof, and shall specify in such notice
  the action, if any, the Master Servicer is taking with respect of such
  default. If such an Event of Servicing Termination shall arise from the
  failure of the Master Servicer to perform any of its duties or obligations
  under the Sale and Servicing Agreement with respect to the Mortgage Loans,
  the Issuer shall take all reasonable steps available to it to remedy or cause
  to be remedied such failure. 


	
 

	
 


	
 

	
          (e)
  Subject to the terms of the Sale and Servicing Agreement, as promptly as
  possible after the giving of notice of termination to the Master Servicer of
  the Master Servicer’s rights and powers pursuant to Section 8.01 of the Sale
  and Servicing Agreement, a successor servicer (the “Successor Master
  Servicer”) shall be appointed pursuant to Section 7.02 of the Sale and
  Servicing Agreement. If the Indenture Trustee shall succeed to the Master
  Servicer’s duties as servicer of the Mortgage Loans as provided therein, it
  shall do so in its individual capacity and not in its capacity as Indenture
  Trustee and, accordingly, the provisions of Article VI hereof shall be
  inapplicable to the Indenture Trustee in its duties as successor Master
  Servicer and the servicing of the Mortgage Loans, but rather the provisions
  of the Sale and Servicing Agreement shall be applicable. In case the
  Indenture Trustee shall become successor Master Servicer under the Sale and Servicing
  Agreement, the Indenture Trustee shall be entitled to appoint as Successor
  Master Servicer any one of its Affiliates reasonably acceptable to the
  Insurer. 


	
 

	
 


	
 

	
          (f)
  Without derogating from the absolute nature of the assignment granted to the
  Indenture Trustee under this Indenture or the rights of the Indenture Trustee
  hereunder, the Issuer agrees (i) that it will not, without the prior written
  consent of the Indenture Trustee (acting at the direction of the holders of
  at least 51% of the Outstanding Amount











	
 

	
 


	
 

	
of the Notes) and the
  Insurer (which consent shall not be unreasonably withheld), amend, modify,
  waive, supplement, terminate or surrender, or agree to any amendment,
  modification, supplement, termination, waiver or surrender of, the terms of
  the Trust Estate (except to the extent otherwise provided in the Sale and
  Servicing Agreement or the other Transaction Documents), or waive timely
  performance or observance by the Master Servicer or the Seller under the Sale
  and Servicing Agreement; and (ii) that any such amendment shall not (A)
  increase or reduce in any manner the amount of, or accelerate or delay the
  timing of, distributions that are required to be made for the benefit of the
  Noteholders or (B) reduce the percentage of the Notes, set forth in Section
  9.2, that is required to consent to any such amendment, without the consent
  of the Holders of all the outstanding Notes. If any such amendment,
  modification, supplement or waiver shall be so consented to by the Indenture
  Trustee (acting at the direction of the holders of at least 51% of the
  Outstanding Amount of the Notes) and the Insurer, the Issuer agrees, promptly
  following a request by the Indenture Trustee or the Insurer to do so, to
  execute and deliver, in its own name and at its own expense, such agreements,
  instruments, consents and other documents as the Indenture Trustee or the
  Insurer may deem necessary or appropriate in the circumstances. 





          Section
3.8 Negative Covenants. So long as any Notes are Outstanding, the Issuer shall not, unless
the Insurer otherwise consents in writing:  


	
 

	
 


	
 

	
          (a)
  except as expressly permitted by this Indenture or the Sale and Servicing
  Agreement, sell, transfer, exchange or otherwise dispose of any of the
  properties or assets of the Issuer, including those included in the Trust
  Estate, unless directed to do so by the Indenture Trustee and consented to by
  the Insurer; 


	
 

	
 


	
 

	
          (b)
  claim any credit on, or make any deduction from the principal or interest
  payable in respect of, the Notes (other than amounts properly withheld from
  such payments under the Code) or assert any claim against any present or
  former Noteholder by reason of the payment of the taxes levied or assessed
  upon any part of the Trust Estate; 


	
 

	
 


	
 

	
          (c)
  engage in any business or activity other than as permitted by the Trust
  Agreement or other than in connection with, or relating to, the issuance of
  Notes pursuant to this Indenture and the Transferor Interest pursuant to the
  Trust Agreement, or amend the Trust Agreement as in effect on the Closing
  Date other than in accordance with Section 11.1 thereof; 


	
 

	
 


	
 

	
          (d)
  issue debt obligations under any other indenture; 


	
 

	
 


	
 

	
          (e)
  incur or assume any indebtedness or guaranty any indebtedness of any Person,
  except for such indebtedness as may be incurred by the Issuer in connection
  with the issuance of the Notes pursuant to this Indenture; 


	
 

	
 


	
 

	
          (f)
  dissolve or liquidate in whole or in part, or, subject to Section 3.16, merge
  or consolidate with any other Person; 


	
 

	
 


	
 

	
          (g)
  (A) permit the validity or effectiveness of this Indenture to be impaired, or
  permit the lien of this Indenture to be amended, hypothecated, subordinated,












	
 

	
 


	
 

	
terminated
  or discharged, or permit any Person to be released from any covenants or
  obligations with respect to the Notes under this Indenture except as may be
  expressly permitted hereby, (B) permit any lien, charge, excise, claim,
  security interest, mortgage or other encumbrance (other than the lien of this
  Indenture) to be created on or extend to or otherwise arise upon or burden
  the Trust Estate or any part thereof or any interest therein or the proceeds
  thereof (other than tax liens, mechanics’ liens and other liens that arise by
  operation of law, in each case on any of the Mortgaged Properties and arising
  solely as a result of an action or omission of the related Mortgagor) or (C)
  permit the lien of this Indenture not to constitute a valid first priority
  (other than with respect to any such tax, mechanics’ or other lien) security
  interest in the Trust Estate;


	
 

	
 


	
 

	
          (h)
  change its name, the location of its chief executive office, the jurisdiction
  of its formation, or the type of entity it is, unless it has first (A) taken
  all actions, including the making of all filings under the UCC as in effect
  in all applicable jurisdictions, as are necessary to maintain and continue
  the first-priority perfected security interest of the Indenture Trustee in
  the Collateral, and (B) delivered to the Indenture Trustee and the Insurer an
  Opinion of Counsel acceptable to the Indenture Trustee and the Insurer that
  the Issuer has made all filings or taken such actions under the UCC as are
  necessary to maintain and continue the first-priority perfected security
  interest of the Indenture Trustee in the Collateral; or 


	
 

	
 


	
 

	
          (i)
  take any other action or fail to take any action which may cause the Issuer
  to be taxable as (a) an association pursuant to Section 7701 of the Code and
  the corresponding regulations or (b) a taxable mortgage pool pursuant to
  Section 7701(i) of the Code and the corresponding regulations. 





          Section
3.9 Annual Statement as to Compliance. The Issuer will deliver to the Indenture Trustee
and the Insurer, no later than March 15th of each year (commencing
with the fiscal year 2008), an Officer’s Certificate stating, as to the
Authorized Officer signing such Officer’s Certificate, that:  


	
 

	
 


	
 

	
          (a)
  a review of the activities of the Issuer during such year and of its performance
  under this Indenture has been made under such Authorized Officer’s
  supervision; and 


	
 

	
 


	
 

	
          (b)
  to the best of such Authorized Officer’s knowledge, based on such review, the
  Issuer has complied with all conditions and covenants under this Indenture
  throughout such year, or, if there has been a default in its compliance with
  any such condition or covenant, specifying each such default known to such
  Authorized Officer and the nature and status thereof. 





          Section
3.10 Covenants of the Issuer (not Covenants of the Owner Trustee). All covenants of the Issuer
in this Indenture are covenants of the Issuer and are not covenants of the
Owner Trustee. The Owner Trustee is, and any successor Owner Trustee under the
Trust Agreement will be, executing this Indenture solely as Owner Trustee under
the Trust Agreement and not in its respective individual capacity, and in no
case whatsoever shall the Owner Trustee or any such successor Owner Trustee be
personally liable on, or for any loss in respect of, any of 






the statements, representations, warranties or obligations of the Issuer hereunder,
as to all of which the parties hereto agree to look solely to the property of
the Issuer. 


          It
is expressly understood and agreed by the parties that (a) this Indenture is
executed and delivered by Wilmington Trust Company, not individually or
personally, but solely as Owner Trustee, in the exercise of the powers and
authority conferred and vested in it, pursuant to the Trust Agreement, (b) each
of the representations, undertakings and agreements herein made on the part of
the Trust is made and intended not as personal representations, undertakings
and agreements by Wilmington Trust Company but is made and intended for the
purpose for binding only the Trust, (c) nothing herein contained shall be
construed as creating any liability on Wilmington Trust Company, individually
or personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties
hereto and by any person claiming by, through or under the parties hereto, and
(d) under no circumstances shall Wilmington Trust Company be personally liable
for the payment of any indebtedness or expenses of the Trust or be liable for
the breach or failure of any obligation, representation, warranty or covenant
made or undertaken by the Trust under this Indenture or any other related
documents. 


          Section
3.11 Master Servicer’s Obligations. The Issuer shall cause the Master Servicer to
comply with its obligations under the terms of the Sale and Servicing
Agreement. 


          Section
3.12 Restricted Payments. The Issuer shall not, directly or indirectly, (i) pay any
dividend or make any distribution (by reduction of capital or otherwise),
whether in cash, property, securities or a combination thereof, to the Owner
Trustee or any owner of a beneficial interest in the Issuer or otherwise with
respect to any ownership or equity interest or security in or of the Issuer or
to the Master Servicer, (ii) redeem, purchase, retire or otherwise acquire for
value any such ownership or equity interest or security or (iii) set aside or
otherwise segregate any amounts for any such purpose; provided, however, that
the Issuer may make, or cause to be made(x) distributions to the Master
Servicer, the Indenture Trustee, the Owner Trustee, the Administrator, the
Insurer, the Transferor Interest and the Noteholders as contemplated by, and to
the extent funds are available for such purpose under this Indenture, the Sale
and Servicing Agreement or the Trust Agreement. The Issuer will not, directly
or indirectly, make or cause to be made payments to or distributions from the
Collection Account except in accordance with this Indenture and the Transaction
Documents. 


          Section
3.13 Treatment of Notes as Debt for All Purposes. The Issuer shall treat the Notes as
indebtedness for all purposes. 


          Section
3.14 Notice of Events of Default. The Issuer shall give the Indenture Trustee, the
Seller, the Insurer and the Rating Agencies prompt written notice of each Event
of Default hereunder, each default on the part of the Master Servicer of its
obligations under the Sale and Servicing Agreement and each default on the part
of the Depositor or the Seller of its obligations under the Sale and Servicing
Agreement. 


          Section
3.15 Further Instruments and Acts. Upon request of the Indenture Trustee or the Insurer,
the Issuer will execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture. 






Section 3.16 Issuer May Consolidate, etc.  


	
 

	
 


	
 

	
(a) The Issuer shall not consolidate
  or merge with or into any other Person, unless:


	
 

	
 


	
 

	
          (i)
  the Person (if other than the Issuer) formed by or surviving such
  consolidation or merger shall be a Person organized and existing under the
  laws of the United States of America or any State or the District of Columbia
  and shall expressly assume, by an indenture supplemental hereto, executed and
  delivered to the indenture Trustee, in form reasonably satisfactory to the
  Insurer, the due and punctual payment of the principal of and interest on all
  Notes and to the Paying Agent, on behalf of the holder of the Transferor
  Interest and the performance or observance of every agreement and covenant of
  this Indenture on the part of the Issuer to be performed or observed, all as
  provided herein; 


	
 

	
 


	
 

	
          (ii)
  immediately after giving effect to such transaction, no Event of Default
  shall have occurred and be continuing;


	
 

	
 


	
 

	
          (iii) the
  Insurer shall have consented in writing (which consent shall not be
  unreasonably withheld) thereto and each Rating Agency shall have notified the
  Issuer that such transaction will not cause a reduction or withdrawal by a
  Rating Agency of its then current rating of the Notes, without regard to the
  Insurance Policy;


	
 

	
 


	
 

	
          (iv)
  the Issuer shall have received an Opinion of Counsel (and shall have
  delivered copies thereof to the Indenture Trustee and the Insurer) to the
  effect that such transaction will not have any material adverse tax
  consequence to the Issuer, any Noteholder or the Insurer;


	
 

	
 


	
 

	
          (v)
  any action that is necessary to maintain the lien and security interest
  created by this Indenture, and the perfection thereof, shall have been taken;
  and 


	
 

	
 


	
 

	
          (vi)
  the Issuer shall have delivered to the Indenture Trustee and the Insurer an
  Officer’s Certificate and an Opinion of Counsel each stating that such
  consolidation or merger and such supplemental indenture comply with this
  Article III and that all conditions precedent herein provided for relating to
  such transaction have been complied with (including any filing required by
  the Exchange Act).


	
 

	
 


	
                    (b) The Issuer shall not convey or
  transfer its properties or assets, substantially as an entirety, to any
  Person, unless:


	
 

	
 


	
 

	
          (i) (A)
  the Person that acquires by conveyance or transfer the properties and assets
  of the Issuer, the conveyance or transfer of which is hereby restricted, (1)
  is a United States citizen or a Person organized and existing under the laws
  of the United States of America or any State, (2) expressly assumes, by an
  indenture supplemental hereto, executed and delivered to the Indenture
  Trustee and the Insurer, in form satisfactory to the Insurer, the due and
  punctual payment 












	
 

	
 


	
 

	
of the
  principal of and interest on all Notes and the performance or observance of
  every agreement and covenant of this Indenture on the part of the Issuer to
  be performed or observed, all as provided herein, (3) expressly agrees by
  means of such supplemental indenture that all right, title and interest so
  conveyed or transferred shall be subject and subordinate to the rights of
  Holders of the Notes and the Insurer, (4) unless otherwise provided in such
  supplemental indenture, expressly agrees to indemnify, defend and hold
  harmless the Issuer and the Insurer against and from any loss, liability or
  expense arising under or related to this Indenture and the Notes and (5)
  expressly agrees by means of such supplemental indenture that such Person (or
  if a group of Persons, then one specified Person) shall make all filings with
  the Commission (and any other appropriate Person) required by the Exchange
  Act in connection with the Notes; 








	
 

	
 

	
 


	
 

	 	
          (B)
  immediately after giving effect to such transaction, no Default or Event of
  Default shall have occurred and be continuing; 


	
 

	 	
 


	
 

	 	
          (C) the Insurer shall have consented
  thereto, and each Rating Agency shall have notified the Issuer that such
  transaction will not cause a reduction or withdrawal by a Rating Agency of
  its then current rating of the Notes, without regard to the Insurance Policy;
  


	
 

	 	
 


	
 

	 	
          (D)
  the Issuer shall have received an Opinion of Counsel (and shall have
  delivered copies thereof to the Indenture Trustee) to the effect that such
  transaction will not have any material adverse tax consequence to the Issuer,
  the Insurer or any Noteholders 


	
 

	 	
 


	
 

	 	
          (E) any action that is necessary to
  maintain the lien and security interest created by this Indenture and the
  perfection thereof shall have been taken; and 


	
 

	 	
 


	
 

	 	
          (F) the Issuer shall have delivered to
  the Indenture Trustee and the Insurer an Officer’s Certificate and an Opinion
  of Counsel each stating that such conveyance or transfer and such
  supplemental indenture comply with this Article III and that all conditions
  precedent herein provided for relating to such transaction have been complied
  with (including any filing required by the Exchange Act); or 


	
 

	 	
 


	
 

	
          (ii) such conveyance or transfer is
  made in connection with a termination pursuant to Section 8.01(b) of the Sale
  and Servicing Agreement.





          Section
3.17 Successor or Transferee. 


	
 

	
 


	
 

	
          (a)
  Upon any consolidation or merger of the Issuer in accordance with Section
  3.16(a) above, the Person formed by or surviving such consolidation or merger
  (if other than the Issuer) shall succeed to, and be substituted for, and may
  exercise every right and power of, the Issuer under this Indenture with the
  same effect as if such Person had been named as the Issuer herein. 












	
 

	
 


	
 

	
          (b)
  Upon a conveyance or transfer of the assets and properties of the Issuer
  pursuant to Section 3.16(b) above, the Issuer shall be released from every
  covenant and agreement (except such obligations that survive such transfer)
  of this Indenture to be observed or performed on the part of the Issuer with
  respect to the Notes immediately upon the delivery of written notice to the
  Indenture Trustee of such conveyance or transfer. 





          Section
3.18 No Other Business. The Issuer shall not engage in any business other than
financing, purchasing, owning, selling and managing the Mortgage Loans and the
issuance of the Notes in the manner contemplated by this Indenture and the
Transaction Documents and all activities incidental thereto. 


          Section
3.19 No Borrowing. The Issuer shall not issue, incur, assume, guarantee or
otherwise become liable, directly or indirectly, for any indebtedness except
for the Notes. 


          Section
3.20 Guarantees Loans Advances and Other Liabilities. Except as contemplated by this
Indenture or the other Transaction Documents, the Issuer shall not make any
loan or advance or credit to, or guarantee (directly or indirectly or by an
instrument having the effect of assuring another’s payment or performance on
any obligation or capability of so doing or otherwise), endorse or otherwise
become contingently liable, directly or indirectly, in connection with the
obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person. 


          Section
3.21 Capital Expenditures. The Issuer shall not make any expenditure (by long-term or
operating lease or otherwise) for capital assets (either realty or personalty).



          Section
3.22 Validity of Notes.  


	
 

	
 


	
 

	
          (a)
  The Issuer represents and warrants that the Indenture creates a valid and
  continuing security interest (as defined in the applicable UCC) in the
  Collateral in favor of the Indenture Trustee, which security interest is
  prior to all other liens, and is enforceable as such as against creditors of
  and purchasers from the Issuer. 


	
 

	
 


	
 

	
          (b)
  The Issuer represents and warrants that the Issuer owns and has good and
  marketable title to the Collateral free and clear of any lien, claim or
  encumbrance of any Person. 


	
 

	
 


	
 

	
          (c)
  The Issuer represents and warrants that the Issuer has caused or will have
  caused, within ten days, the filing of all appropriate financing statements
  in the proper filing office in the appropriate jurisdictions under applicable
  law in order to perfect the security interest in the Collateral granted to
  the Indenture Trustee hereunder. 


	
 

	
 


	
 

	
          (d)
  The Issuer represents and warrants that other than the security interest
  Granted to the Indenture Trustee pursuant to this Indenture, the Issuer has
  not pledged, assigned, sold, granted a security interest in, or otherwise
  conveyed any of the Collateral. The Issuer has not authorized the filing of
  and is not aware of any financing statements against the Issuer that include
  a description of the Collateral other than any financing statement relating
  to the security interest Granted to the Indenture Trustee hereunder or 












	
 

	
 


	
 

	
that has
  been terminated. The Issuer is not aware of any judgment or tax lien filings
  against the Issuer.


	
 

	
 


	
 

	
          (e)
  The Issuer represents and warrants that the Custodian on behalf of the Issuer
  has in its possession all original copies of the Mortgage Notes that
  constitute or evidence the Mortgage Loans. The Mortgage Notes that constitute
  or evidence the Mortgage Loans do not have any marks or notations indicating
  that they have been pledged, assigned or otherwise conveyed to any Person
  other than the Indenture Trustee. All financing statements filed or to be
  filed against the Issuer in favor of the Indenture Trustee in connection
  herewith describing the Collateral contain a statement to the following
  effect: “A purchase of or security interest in any collateral described in
  this financing statement will violate the rights of the Indenture Trustee.” 


	
 

	
 


	
 

	
          (f)
  The Issuer represents and warrants that the Mortgage Notes constitute either
  “instruments” or “general intangibles” within the meaning of the applicable
  UCC. 


	
 

	
 


	
 

	
          (g)
  The Issuer represents and warrants that the Issuer is duly authorized under
  applicable law and the Trust Agreement to create and issue the Notes, to
  execute and deliver this Indenture, the other documents referred to herein to
  which it is a party and deliver all instruments included in the Collateral
  which it has delivered hereunder, and that all corporate action and
  governmental consents, authorizations and approvals necessary or required
  therefor have been duly and effectively taken or obtained. The Notes, when
  issued, will be, and .this Indenture and such other documents are, valid and
  legally binding obligations of the Issuer enforceable in accordance with
  their terms. 


	
 

	
 


	
 

	
          (h)
  [Reserved]. 


	
 

	
 


	
 

	
          (i)
  The Issuer represents and warrants that the Indenture is duly qualified under
  the 1939 Act and that the Issuer is not required to be registered as an
  “investment company” under the 1940 Act. 


	
 

	
 


	
 

	
Such
  representations and warranties shall survive the discharge of this Indenture
  and may not be waived.





ARTICLE IV 

SATISFACTION AND DISCHAGE


          Section
4.1 Satisfaction and Discharge of Indenture. Subject to and in accordance with section 8.01 of
the Sale and Servicing Agreement, this Indenture shall cease to be of further
effect with respect to the Notes (except as to (i) rights of registration of
transfer and exchange, (ii) substitution of mutilated, destroyed, lost or
stolen Notes, (iii) rights of Noteholders to receive payments of principal
thereof and interest thereon, (iv) Sections 3.3, 3.4, 3.5, 3.8, 3.10 and 11.17,
(v) the rights, obligations and immunities of the Indenture Trustee hereunder
(including the rights of the Indenture Trustee under Section 6.7 below and the
obligations of the Indenture Trustee under Section 4.2) and (vi) the rights of
Noteholders as beneficiaries hereof with respect to the property so deposited
with the Indenture Trustee payable to all or any of them), and the Indenture
Trustee, on demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with respect
to the Notes, when all of the following have occurred:  







	
 

	
 


	
 

	
(a) either 








	
 

	
 


	
 

	
          (i)
  all Notes theretofore authenticated and delivered (other than (i) Notes that
  have been destroyed, lost or stolen and that have been replaced or paid as provided
  in Section 2.4 and (ii) Notes for whose payment money has theretofore been
  deposited in trust or segregated and held in trust by the Issuer and
  thereafter repaid to the Issuer or discharged from such trust, as provided in
  Section 3.3 above) have been delivered to the Indenture Trustee for
  cancellation; or 


	
 

	
 


	
 

	
          (ii)
  all Notes not theretofore delivered to the Indenture Trustee for cancellation
  








	
 

	
 


	
 

	
          A. have
  become due and payable, 


	
 

	
 


	
 

	
          B. will
  become due and payable within one year prior to the Final Payment Date, or 


	
 

	
 


	
 

	
          C. are
  to be called for redemption within one year under arrangements satisfactory
  to the Indenture Trustee for the giving of notice of redemption by the
  Indenture Trustee in the name, and at the expense, of the Issuer, 





and the
Issuer, in the case of a., b. or c. above, has irrevocably deposited or caused
to be irrevocably deposited with the Indenture Trustee cash or direct
obligations of or obligations guaranteed by the United States of America (which
will mature prior to the date such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and discharge the entire indebtedness
on such Notes not theretofore delivered to the Indenture Trustee for
cancellation when due to the Final Payment Date or Redemption Date (if Notes
shall have been called for redemption pursuant to Section 10.1 below) and all
amounts due and owing the Insurer and the Indenture Trustee have been paid, as
the case may be, 


	
 

	
 


	
 

	
          (b) the later of (a) twelve months
  after payment in full of all outstanding obligations under the Notes, (b) the
  payment in full of all unpaid fees and expenses of the Indenture Trustee
  hereunder and the other Transaction Documents, (c) the payment of all amounts
  due and owing to the Insurer for unpaid premiums and unreimbursed Insured
  Payments and all other amounts owing to the Insurer, together with interest
  thereon as provided under the Insurance and Indemnity Agreement and (d) the
  date on which the Issuer has paid or caused to be paid all other sums payable
  hereunder by the Issuer; and 


	
 

	
 


	
 

	
          (c) the Issuer has delivered to the Indenture
  Trustee and the Insurer an Officer’s Certificate, an Opinion of Counsel and (if required by the TIA or the Indenture
  Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable
  requirements of Section 11.1(a) below and, subject to Section 11.2 below,
  each stating that all conditions precedent herein provided for relating to
  the satisfaction and discharge of this Indenture with respect to the Notes
  have been complied with. 





          Section
4.2 Application of Trust Money. All moneys deposited with the Indenture Trustee pursuant to
Sections 3.3 and 4.1 shall be held in trust and applied by it, in accordance 







with the
provisions of the Sale and Servicing Agreement, to the payment, either directly
or through any Paying Agent to the Holders of the particular Notes and the
Insurer for the payment or redemption of which such moneys have been deposited
with the Indenture Trustee, of all sums due and to become due thereon for
principal and interest; but such moneys need not be segregated from other funds
except to the extent required herein or in the Sale and Servicing Agreement or required
by law. 


          Section
4.3 Subrogation and Cooperation. 


	
 

	
 


	
 

	
          (a) The Issuer and the Indenture
  Trustee acknowledge that (i) to the extent the Insurer makes payments under
  the Insurance Policy on account of principal of or interest on the Mortgage
  Loans, the Insurer will be fully subrogated to the rights of the Noteholders
  to receive such principal of and interest on the Mortgage Loans of the
  related Trust Estate, and (ii) the insurer shall be paid such principal and
  interest only from the sources and in the manner provided herein and in the
  Insurance and Indemnity Agreement for the payment of such principal and
  interest. 


	
 

	
 


	
 

	
          (b) The Indenture Trustee shall
  cooperate in all respects with any reasonable request or direction by the
  Insurer for action to preserve or enforce the Insurer’s rights or interest
  under this Indenture or the Insurance and Indemnity Agreement, consistent
  with this Indenture and without limiting the rights of the Noteholders as
  otherwise set forth in the Indenture, including without limitation upon the
  occurrence and continuance of an Insurer Default, a request to take any one
  or more of the following actions: 








	
 

	
 


	
 

	
          (i) institute
  Proceedings for the collection of all amounts then payable on the Notes or
  under this Indenture in respect to the Notes and all amounts payable under
  the Insurance and Indemnity Agreement and to enforce any judgment obtained
  and collect from the Issuer monies adjudged due; 


	
 

	
 


	
 

	
          (ii) sell
  the Trust Estate or any portion thereof or rights or interest therein, at one
  or more public or private sales called and conducted in any manner permitted
  by law; 


	
 

	
 


	
 

	
          (iii) file or record all Assignments of
  Mortgages that have not previously been recorded;


	
 

	
 


	
 

	
          (iv) institute Proceedings from time to
  time for the complete or partial foreclosure of this Indenture; and


	
 

	
 


	
 

	
          (v) exercise
  any remedies of a secured party under the UCC and take any other appropriate
  action to protect and enforce the rights and remedies of the Insurer
  hereunder. 


	
 

	
 


	
                    Following
  the payment in full of the Notes, the Insurer shall continue to have all
  rights and privileges provided to it under this Section 4.3 and in all other
  provisions of this Indenture, until all amounts owing to the Insurer have
  been paid in full.












          Section
4.4 Repayment of Moneys Held by Paying Agent. In connection with the satisfaction and
discharge of this Indenture with respect to the Notes, all moneys then held by
any Paying Agent other than the Indenture Trustee under the provisions of this
Indenture with respect to such Notes shall, upon demand of the Issuer, be paid
to the Indenture Trustee to be held and applied according to Section 3.3 above
and thereupon such Paying Agent shall be released from all further liability
with respect to such moneys.  


ARTICLE V 

REMEDIES


          Section
5.1 Events of Default. “Event of Default,” wherever used herein, means with respect to the
Notes any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):  


	
 

	
 


	
 

	
          (a) default in the payment of any
  interest on any Note when the same becomes due and payable, and continuance
  of such default for a period of five (5) days; or 


	
 

	
 


	
 

	
          (b) default in the payment in full of
  the principal of the Note Principal Balance on the Final Payment Date; or 


	
 

	
 


	
 

	
          (c) default in the observance or
  performance of any covenant or agreement of the Issuer made in this Indenture
  (other than a covenant or agreement, a default in the observance or
  performance of which is elsewhere in this Section 5.1 specifically dealt
  with), or any representation or warranty of the Issuer made in this
  Indenture, the Sale and Servicing Agreement or in any certificate or other
  writing delivered pursuant hereto or in connection herewith proving to have
  been incorrect in any material respect as of the time when the same shall
  have been made, and such default shall continue or not be cured, or the
  circumstance or condition in respect of which such misrepresentation or
  warranty was incorrect shall not have been eliminated or otherwise cured, for
  a period of 30 days after there shall have been given, by registered or
  certified mail, to the Issuer with a copy to the Insurer by the Indenture
  Trustee or to the Issuer and the Indenture Trustee by the Insurer or the
  Holders of at least 51% of the Outstanding Amount of the Notes, a written
  notice specifying such default or incorrect representation or warranty and
  requiring it to be remedied and stating that such notice is a notice of
  Default hereunder; or 


	
 

	
 


	
 

	
          (d) the occurrence of a draw under the
  Insurance Policy that remains unreimbursed for a period of 90 days; or 


	
 

	
 


	
 

	
          (e) the filing of a decree or order
  for relief by a court having jurisdiction in the premises in respect of the
  Issuer or any substantial part of the Trust Estate in an involuntary case
  under any applicable federal or state bankruptcy, insolvency or other similar
  law now or hereafter in effect, or appointing a receiver, liquidator,
  assignee, custodian, trustee, sequestrator or similar official of the Issuer
  or for any substantial part of the Trust Estate, or ordering the winding up
  or liquidation of the Issuer’s affairs, and such decree or order shall remain
  unstayed and in effect for a period of 90 consecutive days; or 












	
 

	
 


	
 

	
          (f) the commencement by the Issuer of
  a voluntary case under any applicable federal or state bankruptcy, insolvency
  or other similar law now or hereafter in effect, or the consent by the Issuer
  to the entry of an order for relief in an involuntary case under any such
  law, or the consent by the Issuer to the appointment or taking possession by
  a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
  official of the Issuer or for any substantial part of the Trust Estate, or
  the making by the Issuer of any general assignment for the benefit of
  creditors, or the failure by the Issuer generally to pay its debts as such
  debts become due, or the taking of any action by the Issuer in furtherance of
  any of the foregoing. 





          The
Issuer shall deliver to the Indenture Trustee, the Transferor and the Insurer
within five days after the occurrence thereof, written notice in the form of an
Officer’s Certificate of any event which with the giving of notice and the
lapse of time would become an Event of Default under, clause (c) above, its
status and what action the Issuer is taking or proposes to take with respect
thereto. 


          Section
5.2 Acceleration of Maturity; Rescission and Annulment. If an Event of Default should occur and
be continuing, then and in every such case the Indenture Trustee may with the
written consent of the Insurer, or shall at the direction of the Insurer or
upon the prior written direction of the Holders of Notes representing not less
than a majority of the Outstanding Amount of the Notes, declare all the Notes
to be immediately due and payable, by a notice in writing to the Issuer and the
Insurer (and to the Indenture Trustee if given by Noteholders), and upon any
such declaration the unpaid principal amount of such Class A Notes, together
with accrued and unpaid interest thereon through the date of acceleration,
shall become immediately due and payable.  


          At
any time after such declaration of acceleration of maturity has been made and
before a judgment or decree for payment of the money due has been obtained by
the Indenture Trustee as hereinafter in this Article V provided, the Insurer or
the Holders of Notes representing a majority of the Outstanding Amount of the
related Notes, with the written consent of the Insurer, by written notice to
the Issuer and the Indenture Trustee, may rescind and annul such declaration
and its consequences if: 


	
 

	
 

	
 


	
 

	
          (a) the Issuer has paid or deposited
  with the Indenture Trustee a sum sufficient to pay:


	
 

	
 


	
 

	
 

	
          (i) all
  payments of principal of and interest on all Notes and all other amounts that
  would then be due hereunder or hpon such Notes and to the Insurer if the
  Event of Default giving rise to such acceleration had not occurred; and 


	
 

	
 

	
 


	
 

	
 

	
          (ii) all
  sums paid or advanced by the Indenture Trustee hereunder and the reasonable
  compensation, expenses, disbursements and advances of the Indenture Trustee
  and its agents and counsel; and 


	
 

	
 

	
 


	
 

	
          (b) all Events of Default, other than
  the nonpayment of the principal of the Notes that has become due solely by
  such acceleration, have been cured or waived as provided in Section 5.12
  below.














          No
such rescission shall affect any subsequent default or impair any right
consequent thereto. 


          Section
5.3 Collection
of Indebtedness and Suits for Enforcement by Indenture Trustee.


	
 

	
 


	
 

	
          (a) The Issuer covenants that if (i)
  default occurs in the payment of any interest on any Note when the same
  becomes due and payable, and such default continues for a period of five (5)
  days, or (ii) default occurs in the payment of the principal of or any
  installment of the principal of any Note when the same becomes due and
  payable, and such default continues for a period of five (5) days, the Issuer
  will, upon demand of the Indenture Trustee or the Insurer if the Insurer has
  made a payment under the Insurance Policy, pay to the Indenture Trustee or
  the Insurer, as applicable, for the benefit of the Holders of the Notes or
  the insurer, the whole amount then due and payable on such Notes for
  principal and interest, with interest upon the overdue principal and, to the
  extent payment at such rate of interest shall be legally enforceable, upon
  overdue installments of interest at the rate borne by the Notes and in
  addition thereto such further amount as shall be sufficient to cover the
  costs and expenses of collection, including the reasonable compensation,
  expenses, disbursements and advances of the Indenture Trustee, the Insurer
  and its agents and counsel.


	
 

	
 


	
 

	
          (b) In case the Issuer shall fail
  forthwith to pay such amounts upon such demand, the Indenture Trustee may
  with the written consent of the Insurer, and shall at the direction of the
  Insurer, institute a Proceeding for the collection of the sums so due and
  unpaid, and may prosecute such Proceeding to judgment or final decree, and
  may enforce the same against the Issuer or other obligor upon such Notes and
  collect in the manner provided by law out of the property of the Issuer or
  other obligor upon such Notes, wherever situated, the moneys adjudged or
  decreed to be payable.


	
 

	
 


	
 

	
          (c) If an Event of Default occurs and
  is continuing, the Indenture Trustee may, with the consent of the Insurer,
  and shall at the written direction of the Insurer or of the Holders of 51% or
  more of the Outstanding Amount of the Notes, with the consent of the Insurer,
  as more particularly provided in Section 5.4 below, proceed to protect and
  enforce its rights and the rights of the Noteholders and the Insurer, by such
  appropriate Proceedings as the Insurer shall deem most effective to protect
  and enforce any such rights whether for the specific enforcement of any
  covenant or agreement in this Indenture or in aid of the exercise of any
  power granted herein, or to enforce any other proper remedy or legal or
  equitable right vested in the Indenture Trustee by this Indenture or by law.


	
 

	
 


	
 

	
          (d) In case there shall be pending,
  relative to the Issuer or any other obligor upon the Notes or any Person
  having or claiming an ownership interest in the Trust Estate, Proceedings
  under Title 11 of the United States Code or any other applicable federal or
  state bankruptcy, insolvency or other similar law, or in case a receiver,
  assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator
  or similar official shall have been appointed for or taken possession of the
  Issuer or its property or such other obligor or Person, or in case of any
  other comparable judicial Proceedings relative to the Issuer or other obligor
  upon the Notes, or to the creditors or property of the Issuer or such other











	
 

	
 


	
 

	
obligor, the
  Indenture Trustee, irrespective of whether the principal of any Notes shall
  then be due and payable as therein expressed or by declaration or otherwise
  and irrespective of whether the Indenture Trustee shall have made any demand
  pursuant to the provisions of this Section 5.3, shall be entitled and
  empowered by intervention in such Proceedings with the consent of or at the
  direction of the Insurer or otherwise: 








	
 

	
 


	
 

	
          (i)
  to file and prove a claim or claims for the whole amount of principal and
  interest owing and unpaid in respect of the Notes and to file such other
  papers or documents as may be necessary or advisable in order to have the
  claims of the Indenture Trustee (including any claim for reasonable
  compensation to the Indenture Trustee, each predecessor Indenture Trustee and
  its agents, attorneys and counsel, and for reimbursement of all expenses and
  liabilities incurred, and all advances made, by the Indenture Trustee and
  each predecessor Indenture Trustee (except as a result of negligence or bad
  faith), and of the Noteholders and the Insurer allowed in such Proceedings;


	
 

	
 


	
 

	
          (ii)
  unless prohibited by applicable law and regulations, to vote on behalf of the
  Holders of Notes and the Insurer in any election of a trustee, a standby
  trustee or Person performing similar functions in any such Proceedings;


	
 

	
 


	
 

	
          (iii) to collect and receive any moneys
  or other property payable or deliverable on any such claims and to distribute
  all amounts received with respect to the claims of the Noteholders, the
  Indenture Trustee and the Insurer on their behalf; and 


	
 

	
 


	
 

	
          (iv) to file such proofs of claim and
  other papers or documents as may be necessary or advisable in order to have
  the claims of the Indenture Trustee, the Insurer or the Holders of Notes
  allowed in any judicial proceedings relative to the Issuer, its creditors and
  its property; and any trustee, receiver, liquidator, custodian or other
  similar official in any such Proceeding is hereby authorized by each of such
  Noteholders to make payments to the Indenture Trustee and, in the event that
  the Indenture Trustee shall consent to the making of payments directly to
  such Noteholders, to pay to the Indenture Trustee such amounts as shall be
  sufficient to cover reasonable compensation to the Indenture Trustee, each
  predecessor Indenture Trustee and their respective agents, attorneys and
  counsel, and all other expenses and liabilities incurred, and all advances
  made, by the Indenture Trustee and each predecessor Indenture Trustee except
  as a result of negligence or bad faith. 








	
 

	
 


	
 

	
          (e) Nothing herein contained shall be
  deemed to authorize the Indenture Trustee to authorize or consent to or vote
  for or accept or adopt on behalf of any Noteholder or the Insurer any plan of
  reorganization, arrangement, adjustment or composition affecting the Notes or
  the rights of any Holder thereof or to authorize the Indenture Trustee to
  vote in respect of the claim of any Noteholder or the Insurer in any such
  proceeding except, as aforesaid, to vote for the election of a trustee in
  bankruptcy or similar Person. 


	
 

	
 


	
 

	
          (f) All rights of action and of
  asserting claims under this Indenture, or under any of the Notes, may be
  enforced by the Indenture Trustee without the possession of any of 











	
 

	
 


	
 

	
the Notes or
  the production thereof in any trial or other Proceedings relative thereto,
  and any such action or Proceedings instituted by the Indenture Trustee shall
  be brought in its own name as trustee of an express trust, and any recovery
  of judgment, subject to the payment of the expenses, disbursements and
  compensation of the Indenture Trustee, each predecessor Indenture Trustee and
  their respective agents and attorneys, shall be for the ratable benefit of
  the Holders of the Notes. 


	
 

	
 


	
 

	
          (g) In any Proceedings brought by the
  Indenture Trustee (and also any Proceedings involving the interpretation of
  any provision of this Indenture to which the Indenture Trustee shall be a
  party), the Indenture Trustee shall be held to represent all the Noteholders,
  and it shall not be necessary to make any Noteholder a party to any such
  Proceedings. 


	
 

	
 


	
 

	
Section 5.4 Remedies; Priorities.


	
 

	
 


	
 

	
          (a) If an Event of Default shall have occurred
  and be continuing of which a Responsible Officer of the Indenture has actual
  knowledge, the Indenture Trustee may with the consent of the Insurer, or, at
  the direction of the Insurer, shall or, if an Insurer Default shall be
  continuing, at the direction of a majority of the Holders of the Notes shall,
  do one or more of the following (subject to Section 5.5 below): 








	
 

	
 


	
 

	
          (i)
  institute Proceedings in its own name and as trustee of an express trust for
  the collection of all amounts then payable on the related Notes or under this
  Indenture with respect thereto, whether by declaration or otherwise, and all
  amounts payable under the Insurance and Indemnity Agreement, enforce any
  judgment obtained, and collect from the Issuer and any other obligor upon
  such Notes moneys adjudged due;


	
 

	
 


	
 

	
          (ii)
  institute Proceedings from time to time for the complete or partial
  foreclosure of this Indenture with respect to the Trust Estate;


	
 

	
 


	
 

	
          (iii) exercise any remedies of a secured
  party under the UCC and take any other appropriate action to protect and
  enforce the rights and remedies of the Indenture Trustee or the Noteholders
  or the Insurer; and 


	
 

	
 


	
 

	
          (iv) sell the Trust Estate or any
  portion thereof or rights or interest therein in a commercially reasonable
  manner, at one or more public or private sales called and conducted in any
  manner permitted by law; 





provided,
however, that the Indenture Trustee may not sell or otherwise liquidate the
Trust Estate following an Event of Default, unless (A) the Indenture Trustee
obtains the consent of the Insurer and the Holders of 100% of the Outstanding
Amount of the Notes, (B) the proceeds of such sale or liquidation distributable
to the Noteholders are sufficient to discharge in full all amounts then due and
unpaid upon such Notes for principal and interest and to reimburse the Insurer for
any unreimbursed Insured Payments and any other amounts due the Insurer under
the Insurance and Indemnity Agreement or (C) the Indenture Trustee determines
that the Trust Estate will not continue to provide sufficient funds for the
payment of principal of and interest on the Notes as they would have become due if the Notes
had not been declared due and payable, and the Indenture Trustee obtains the
consent of the Insurer and the Holders of 66 213% of the Outstanding Amount of 






the Notes. In determining
such sufficiency or insufficiency with respect to clauses (B) and (C) above,
the Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the Trust
Estate for such purpose. 


	
 

	
 


	
 

	
          (b) If the Indenture Trustee collects any money
  or property pursuant to this Article V, the Indenture Trustee and the Paying
  Agent shall pay out the money or property in the following order: 








	
 

	
 


	
 

	
          FIRST:
  to the Indenture Trustee for any costs or expenses incurred by it in
  connection with the enforcement of the remedies provided for in this Article
  V; 


	
 

	
 


	
 

	
          SECOND:
  any amounts payable to the Master Servicer pursuant to Section 5.01 of the
  Sale and Servicing Agreement and any premium owing to the Insurer; 


	
 

	
 


	
 

	
          THIRD:
  to the Indenture Trustee for the Indenture Trustee Fee then due; 34 


	
 

	
 


	
 

	
          FOURTH:
  to the Noteholders for amounts due and unpaid on the Notes for interest pro
  rata among the Holders of the Notes, according to the amounts due and payable
  on such Notes; 


	
 

	
 


	
 

	
          FIFTH:
  to the Noteholders for amounts due and unpaid on the Notes for principal, pro
  rata, among the Holders of the Notes according to the amounts due and payable
  until the Note Principal Balance is reduced to zero; 


	
 

	
 


	
 

	
          SIXTH:
  to the Insurer, any other amounts owed to the Insurer under the Insurance and
  Indemnity Agreement; 


	
 

	
 


	
 

	
          SEVENTH:
  to the Indenture Trustee for any other amounts then due and outstanding; and 


	
 

	
 


	
 

	
          EIGTH:
  to the Paying Agent under the Trust Agreement, as applicable, for any amounts
  to be distributed to the holder of the Transferor Interest, in the manner set
  forth in Section 5.01 of the Sale and Servicing Agreement. 





          The
Indenture Trustee may fix a record date and payment date for any payment to be
made to the Noteholders pursuant to this Section 5.4. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder, the
Insurer and the Issuer a notice that states the record date, the payment date
and the amount to be paid. 


          Section
5.5 Optional
Preservation of the Trust Estate. If the Notes have been declared to be due
and payable under Section 5.2 above following an Event of Default and such
declaration and its consequences have not been rescinded and annulled, the
Indenture Trustee may with the consent of the Insurer, but need not (but shall
at the written direction of the Insurer), elect to maintain possession of the
Trust Estate. It is the desire of the parties hereto and 






the
Noteholders that there be at all times sufficient funds for the payment of
principal of and interest on the Notes (although the parties hereto understand
that there exists the possibility of a shortfall in collections of the Mortgage
Loans), and the Indenture Trustee shall take such desire into account when
determining whether or not to maintain possession of the Trust Estate. In
determining whether to maintain possession of the Trust Estate, the Indenture
Trustee may, but need not, obtain and rely upon an opinion of an Independent
investment banking or accounting firm of national reputation as to the
feasibility of such proposed action and as to the sufficiency of the Trust
Estate for such purpose. 


          Section
5.6 Limitation
of Suits. No Holder of any Note shall have any right to institute any
Proceeding, judicial or otherwise, with respect to this Indenture or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
the Insurer has otherwise consented in writing thereto and: 


	
 

	
 


	
 

	
          (a) such Holder has previously given
  written notice to the Indenture Trustee of a continuing Event of Default; 


	
 

	
 


	
 

	
          (b) the Holders of not less than 25%
  of the Outstanding Amount of the Notes have made written request to the
  Indenture Trustee to institute such Proceeding in respect of such Event of
  Default in its own name as Indenture Trustee hereunder; 


	
 

	
 


	
 

	
          (c) such Holder or Holders have
  offered to the Indenture Trustee reasonable indemnity against the costs,
  expenses and liabilities to be incurred in complying with such request; 


	
 

	
 


	
 

	
          (d) the Indenture Trustee for 60 days
  after its receipt of such notice, request and offer of indemnity has failed
  to institute such Proceedings; and 


	
 

	
 


	
 

	
          (e) no direction inconsistent with
  such written request has been given to the Indenture Trustee during such 60
  day period by the Holders of a majority of the Outstanding Amount of the
  Notes. 





          It
is understood and intended that no Noteholders shall have any right in any
manner whatever by virtue of, or by availing of, any provision of this
Indenture to affect, disturb or prejudice the rights of any other Noteholders
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided. 


          Section
5.7 Unconditional
Rights of Noteholders To Receive Principal and Interest. Notwithstanding
any other provisions in this Indenture, the Holder of any Note shall have the
right, which is absolute and unconditional, to receive payment of the principal
of and interest, if any, on such Note on or after the respective due date
thereof expressed in such Note or in this Indenture (or, in the case of
redemption, on or after the Redemption Date) to the extent funds are available
therefor out of the Trust Estate and to institute suit for the enforcement of
any such payment, and such right shall not be impaired without the consent of
such Holder. 


          Section
5.8 Restoration
of Rights and Remedies. If the Indenture Trustee or any Noteholder has
instituted any Proceeding to enforce any right or remedy under this Indenture
and such Proceeding has been discontinued or abandoned for any reason or has
been determined 






adversely to
the Indenture Trustee or to such Noteholder, then and in every such case the
Issuer, the Indenture Trustee and the Noteholders shall, subject to any
determination in such Proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Indenture Trustee and the Noteholders shall continue as though no such
Proceeding had been instituted. 


          Section
5.9 Rights
and Remedies Cumulative. No right or remedy herein conferred upon or
reserved to the Indenture Trustee, the Insurer or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy. 


          Section
5.10 Delay
or Omission Not a Waiver. No delay or omission of the Indenture Trustee,
the Insurer or any Noteholder to exercise any right or remedy accruing upon any
Default or Event of Default shall impair any such right or remedy or constitute
a waiver of any such Default or Event of Default or an acquiescence therein.
Every right and remedy given by this Article
V or by law to the Indenture Trustee, the Insurer or to the Noteholders may be
exercised from time to time, and as often as may be deemed expedient, by the
Indenture Trustee, the Insurer or by the Noteholders, as the case may be. 


          Section
5.11 Control
by Noteholders. The Insurer (so long as no Insurer Default exists) or if an
Insurer Default exists the Holders of a majority of the Outstanding Amount of
the Notes, shall have the right to direct the time, method and place of
conducting any Proceeding for any remedy available to the Indenture Trustee
with respect to the Notes or exercising any trust or power conferred on the
Indenture Trustee; provided that: 


	
 

	
 


	
 

	
          (a) such direction shall not be in
  conflict with any rule of law or with this Indenture; 


	
 

	
 


	
 

	
          (b) [reserved]; 


	
 

	
 


	
 

	
          (c) if the conditions set forth in
  Section 5.5 above have been satisfied and the Indenture Trustee elects to
  retain the Trust Estate pursuant to such Section 5.5, then any direction to
  the Indenture Trustee by Holders of Notes representing less than 100% of the
  Outstanding Amount of the Notes to sell or liquidate the Trust Estate shall
  be of no force and effect; and 


	
 

	
 


	
 

	
          (d) the Indenture Trustee may take any
  other action deemed proper by the Indenture Trustee that is not inconsistent
  with such direction. 





          Notwithstanding
the rights of the Noteholders set forth in this Section 5.11, subject to
Section 6.1 hereof, the Indenture Trustee need not take any action that it determines
might involve it in liability or might materially adversely affect the rights
of any Noteholders not consenting to such action. 


          Section
5.12 Waiver
of Past Defaults. Prior to the declaration of the acceleration of the
maturity of the Notes as provided in Section 5.2 above, the Insurer (so long as
no Insurer Default 






exists) or the
Holders of Notes representing not less than a majority of the Outstanding
Amount of the Notes, with the consent of the Insurer (so long as no Insurer
Default exists), may waive any past Default or Event of Default and its
consequences except a Default (a) in the payment of principal of or interest on
any of the Notes or(b) in respect of a covenant or provision hereof that cannot
be modified or amended without the consent of the Holder of each Note. In the
case of any such waiver, the Issuer, the Insurer, the Indenture Trustee and the
Holders of the Notes shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent or
other Default or impair any right consequent thereto. 


          Upon
any such waiver, such Default shall cease to exist and be deemed to have been
cured and not to have occurred, and any Event of Default arising therefrom
shall be deemed to have been cured and not to have occurred, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or Event of Default or impair any right consequent thereto. 


          Section
5.13 Undertaking
for Costs. All parties to this Indenture agree, and each Holder of any Note
by such Holder’s acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Indenture
Trustee for any action taken, suffered or omitted by it as Indenture Trustee,
the filing by any party litigant in such suit of an undertaking to pay the
costs of such suit, and that such court may in its discretion assess reasonable
costs, including reasonable attorneys’ fees, against any party litigant in such
suit, having due regard to the merits and good faith of the claims or defenses
made by such party litigant; but the provisions of this Section shall not apply
to (a) any suit instituted by the Indenture Trustee, (b) any suit instituted by
any Noteholder, or group of Noteholders, in each case holding in the aggregate
more than 10% of the Outstanding Amount of the Notes or (c) any suit instituted
by any Noteholder for the enforcement of the payment of principal of or
interest on any Note on or after the respective due dates expressed in such
Note and in this Indenture (or, in the case of redemption, on or after the
Redemption Date). 


          Section
5.14 Waiver
of Stay or Extension Laws. The Issuer covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon, or plead or in any
manner whatsoever, claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Issuer (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Indenture Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted. 


          Section
5.15 Action
on Notes. The Indenture Trustee’s right to seek and recover judgment on the
Notes or under this Indenture shall not be affected by the seeking, obtaining
or application of any other relief under or with respect to this Indenture.
Neither the lien of this Indenture nor any rights or remedies of the Indenture
Trustee or the Noteholders shall be impaired by the recovery of any judgment by
the Indenture Trustee against the Issuer or by the levy of any execution under
such judgment upon any portion of the Trust Estate or upon any of the assets of
the Issuer. Any money or property collected by the Indenture Trustee shall be
applied in accordance with Section 5.4(b) above. 






          Section
5.16 Performance
and Enforcement of Certain Obligations.


	
 

	
 


	
 

	
          (a) Promptly following a request from
  the Insurer or the Indenture Trustee, with the consent of the Insurer to do
  so, the Issuer shall take all such lawful action as the Indenture Trustee or
  the Insurer, as applicable, may request to compel or secure the performance
  and observance by the Seller, the Depositor and the Master Servicer, as
  applicable, of each of their obligations to the Issuer under or in connection
  with the Sale and Servicing Agreement and other Transaction Documents, and to
  exercise any and all rights, remedies, powers and privileges lawfully
  available to the Issuer under or in connection with the Sale and Servicing
  Agreement and the other Transaction Documents to the extent and in the manner
  directed by the Indenture Trustee or the Insurer, as applicable, including
  the transmission of notices of default on the part of the Seller, the
  Depositor or the Master Servicer thereunder and the institution of legal or
  administrative actions or proceedings to compel or secure performance by the
  Seller, the Depositor or the Master Servicer of each of their obligations
  under the Sale and Servicing Agreement and the other Transaction Documents. 


	
 

	
 


	
 

	
          (b) If an Event of Default has
  occurred and is continuing, the Indenture Trustee, subject to the rights of
  the Insurer hereunder and under the Sale and Servicing Agreement, may, and at
  the direction (which direction shall be in writing or by telephone, confirmed
  in writing promptly thereafter) of the Insurer or the Holders of a majority
  of the Outstanding Amount if there is an Insurer Default shall, exercise all
  rights, remedies, powers, privileges and claims of the Issuer against the
  Seller, the Depositor or the Master Servicer under or in connection with the
  Sale and Servicing Agreement and the other Transaction Documents, including
  the right or power to take any action to compel or secure performance or
  observance by the Seller, the Depositor or the Master Servicer, as the case
  may be, of each of their obligations to the Issuer thereunder and to give any
  consent, request, notice, direction, approval, extension, or waiver under the
  Sale and Servicing Agreement and the other Transaction Documents, and any
  right of the Issuer to take such action shall be suspended. 





ARTICLE VI 

THE INDENTURE TRUSTEE 


          Section
6.1 Duties
of Indenture Trustee.


	
 

	
 


	
 

	
          (a) If an Event of Default has
  occurred and is continuing, the Indenture Trustee shall exercise the rights
  and powers vested in it by this Indenture and use the same degree of care and
  skill in their exercise as a prudent person would exercise or use under the
  circumstanced in the conduct of such person’s own affairs. 


	
 

	
 


	
 

	
          (b) Except during the continuance of
  an Event of Default. 








	
 

	
 


	
 

	
          (i) the Indenture Trustee undertakes
  to perform such duties and only such duties as are specifically set forth in
  this Indenture and no implied covenants or obligations shall be read into
  this Indenture against the Indenture Trustee; and 


	
 

	
 


	
 

	
          (ii) in the absence of bad faith on its
  part, the Indenture Trustee may conclusively rely, as to the truth of the
  statements and the correctness of the 











	
 

	
 


	
 

	
opinions
  expressed therein, upon certificates or opinions furnished to the Indenture
  Trustee and conforming to the requirements of this Indenture; however, the Indenture
  Trustee shall examine the certificates and opinions to determine whether or
  not they conform to the requirements of this Indenture. 








	
 

	
 


	
 

	
          (c) The Indenture Trustee may not be
  relieved from liability for its own negligent action, its own negligent
  failure to act or its own willful misconduct, except that: 








	
 

	
 


	
 

	
          (i) this paragraph does not limit the
  effect of paragraph (b) of this Section 6.1; 


	
 

	
 


	
 

	
          (ii) the Indenture Trustee shall not be
  liable for any error of judgment made in good faith by a Responsible Officer
  unless it is proved that the Indenture Trustee was negligent in ascertaining
  the pertinent facts; and 


	
 

	
 


	
 

	
          (iii) the
  Indenture Trustee shall not be liable with respect to any action it takes or
  omits to take in good faith in accordance with a direction received by it
  pursuant to Section 5.11 above or any
  direction from the Insurer that the Insurer is entitled to give under the
  terms of the Transaction Documents. 








	
 

	
 


	
 

	
          (d) Every provision of this Indenture
  that in any way relates to the Indenture Trustee is subject to paragraphs
  (a), (b), (c) and (g) of this Section 6.1. 


	
 

	
 


	
 

	
          (e) The Indenture Trustee shall not be
  liable for interest on any money received by it except as the Indenture
  Trustee may agree in writing with the Issuer. 


	
 

	
 


	
 

	
          (f) Money held in trust by the
  Indenture Trustee shall be segregated from other funds except to the extent
  permitted by law or the terms of this Indenture or the Sale and Servicing
  Agreement. 


	
 

	
 


	
 

	
          (g) No provision of this Indenture
  shall require the Indenture Trustee to expend or risk its own funds or
  otherwise incur financial liability in the performance of any of its duties
  hereunder or in the exercise of any of its rights or powers, if it shall have
  reasonable grounds to believe that repayment of such funds or adequate
  indemnity against such risk or liability is not reasonably assured to it; and
  none of the provisions contained in this Indenture shall in any event require
  the Indenture Trustee to perform, or be responsible for the manner of
  performance of, any of the obligations of the Master Servicer, the Issuer or
  Transferor under this Indenture except during such time, if any, as the
  Indenture Trustee shall be the successor to, and be vested with the rights,
  duties, powers and privileges of, the Master Servicer in accordance with the
  terms of this Indenture. 


	
 

	
 


	
 

	
          (h) The Indenture Trustee shall
  challenge or cause to be challenged any attempt at substantive consolidation
  of the assets and liabilities of the Issuer with those of any Transferor (as
  defined in the Trust Agreement) in connection with any insolvency proceeding
  of the Issuer. 












	
 

	
 


	
 

	
          (i)
  Every provision of this Indenture relating to the conduct or affecting the
  liability of or affording protection to the Indenture Trustee shall be
  subject to the provisions of this Section 6.1 and to the provisions of the
  TIA. 


	
 

	
 


	
 

	
          (j)
  Subject to the other provisions of this Indenture and without limiting the
  generality of this Section 6. 1, the Indenture Trustee shall have no duty (A)
  to see to any recording, filing, or depositing of this Indenture or any agreement
  referred to herein or any financing statement or continuation statement
  evidencing a security interest, or to see to the maintenance of any such
  recording or filing or depositing or to any rerecording, refiling or
  redepositing of any thereof, (B) to see to any insurance, (C) to see to the
  payment or discharge of any tax, assessment, or other governmental charge or
  any lien or encumbrance of any kind owing with respect to, assessed or levied
  against, any part of the Trust Estate other than from funds available in the
  Distribution Account, (D) to confirm or verify the contents of any reports or
  certificates of the Issuer, Insurer or Master Servicer delivered to the
  Indenture Trustee pursuant to this Indenture believed by the Indenture
  Trustee to be genuine and to have been signed or presented by the proper
  party or parties. 





          Section 6.2 Rights of Indenture Trustee.


	
 

	
 


	
 

	
          (a)
  The Indenture Trustee may conclusively rely and shall be fully protected in
  acting or refraining from acting on any resolution, certificate of auditors
  or any other certificate, statement, instrument, opinion, report, notice,
  request, consent, order, appraisal, bond or other paper or document believed
  by it to be genuine and to have been signed or presented by the proper
  person. The Indenture Trustee need not investigate any fact or matter stated
  in the document. 


	
 

	
 


	
 

	
          (b)
  Before the Indenture Trustee acts or refrains from acting, it may require and
  shall be entitled to receive an Officer’s Certificate or an Opinion of
  Counsel. The Indenture Trustee shall not be liable for any action it takes or
  omits to take in good faith in reliance on an Officer’s Certificate or
  opinion of Counsel. 


	
 

	
 


	
 

	
          (c)
  The Indenture trustee may execute any of the trusts or powers hereunder or
  perform any duties hereunder either directly or by or through agents or
  attorneys or a custodian or nominee and the Indenture Trustee shall not be
  responsible for any misconduct or negligence on the part of such agent,
  attorney, nominee or custodian appointed by the Indenture Trustee with due
  care. 


	
 

	
 


	
 

	
          (d)
  The Indenture Trustee shall not be liable for any action it takes or omits to
  take in goal faith which it believes to be authorized or within its rights or
  powers; provided, however, that such action or omission by the Indenture
  Trustee does not constitute willful misconduct, negligence or bad faith. 


	
 

	
 


	
 

	
          (e)
  The Indenture Trustee may consult with counsel, and the advice or opinion of
  counsel selected by it with due care with respect to legal matters relating
  to this Indenture, the Notes and the Transaction Documents to which it is a
  party, shall be full and complete authorization and protection from liability
  in respect to any action taken,










	
 

	
 


	
 

	
omitted or
  suffered by it hereunder in good faith and in accordance with the advice or
  opinion of such counsel. 


	
 

	
 








	
 

	
 


	
 

	
          (f)
  The Indenture Trustee shall be under no obligation to exercise any of the
  trusts or powers vested in it by this Indenture or to institute, conduct or
  defend any litigation hereunder or in relation hereto at the request, order
  or direction of the Insurer or any of the Noteholders, pursuant to the
  provisions of this Indenture, unless the Insurer or such Noteholders shall
  have offered to the Indenture Trustee reasonable security or indemnity
  against the costs, expenses and liabilities which may be incurred therein or
  thereby; nothing contained herein shall, however, relieve the Indenture
  Trustee of the obligation, upon the occurrence of an Event of Default of
  which a Responsible Officer of the Indenture Trustee shall have actual
  knowledge (which has not been cured), to exercise such of the rights and
  powers vested in it by this Indenture, and to use the same degree of care and
  skill in their exercise, as a prudent person would exercise or use under the
  circumstances in the conduct of such person’s own affairs. 


	
 

	
 


	
 

	
          (g)
  The Indenture Trustee shall not be bound to make any investigation into the
  facts or matters stated in any resolution, certificate, statement, instrument,
  opinion, report, notice, request, consent, order, approval, bond or other
  paper or document, unless requested in writing to do so by the Insurer or the
  Majority Noteholders; provided, however, that if the payment within a
  reasonable time to the Indenture Trustee of the costs, expenses or
  liabilities likely to be incurred by it in the making of such investigation
  is, in the opinion of the Indenture Trustee, not reasonably assured to the
  Indenture Trustee by the security afforded to it by the terms of this
  Indenture, the Indenture Trustee may require reasonable indemnity against
  such cost, expense or liability as a condition to taking any such action. The
  reasonable expense of every such examination shall be paid by the Issuer or,
  if paid by the Indenture Trustee, shall be repaid by the Issuer upon demand. 


	
 

	
 


	
 

	
          (h)
  The right of the Indenture Trustee to perform any discretionary act
  enumerated in this Indenture shall not be construed as a duty, and the
  Indenture Trustee shall not be answerable for other than its negligence or
  willful misconduct in the performance of such act. 


	
 

	
 


	
 

	
          (i)
  The Indenture Trustee shall not be required to give any bond or surety in
  respect of the execution of the Trust created hereby or the powers granted hereunder.
  


	
 

	
 


	
 

	
          (j)
  The Indenture Trustee shall have no liability in connection with the
  malfeasance or nonfeasance by the Issuer, the Master Servicer or the
  Administrator. The Indenture Trustee shall have no liability in connection
  with compliance by the Issuer or the Master Servicer with statutory or
  regulatory requirements related to the Collateral or the Trust Estate. The
  Indenture Trustee shall not make or be deemed to have made any
  representations or warranties with respect to the Collateral or the Trust
  Estate or the validity or sufficiency of any assignment of the Collateral or
  the Trust Estate to the Indenture Trustee. 


	
 

	
 


	
 

	
          (k)
  In the event that the Indenture Trustee is also acting as Paying Agent or
  Registrar hereunder, the rights, protection, immunities and indemnities
  afforded to the 


	
 

	
 









	
 

	
 


	
 

	
Indenture
  Trustee pursuant to this Article VI shall also be afforded to such Paying
  Agent or Registrar. 





          Section
6.3 Individual
Rights of Indenture Trustee. The Indenture Trustee in its individual or any
other capacity may become the owner or pledgee of Notes and may otherwise deal
with the Issuer or its Affiliates with the same rights it would have if it were
not Indenture Trustee. Any Paying Agent, Note Registrar, co registrar or co
paying agent may do the same with like rights. However, the Indenture Trustee
must comply with Sections 6.11 and 6.12 below. 


          Section
6.4 Indenture
Trustee’s Disclaimer. The Indenture Trustee shall not be (i) responsible
for and makes no representation as to the validity or adequacy of this
Indenture or the Notes, (ii) accountable for the Issuer’s use of the proceeds
from the Notes or (iii) responsible for any statement of the Issuer in this
Indenture or in any document issued in connection with the sale of the Notes or
in the Notes other than the Indenture Trustee’s certificate of authentication. 


          Section
6.5 Notice
of Defaults. If a Default occurs and is continuing and if it is actually
known to a Responsible Officer of the Indenture Trustee, the Indenture Trustee
shall give prompt notice thereof to the Insurer. The Indenture Trustee shall
not be charged with the knowledge of an Event of Default unless a Responsible
Officer has received written notice or has actual knowledge thereof. The
Indenture Trustee shall mail to each Noteholder, the Master Servicer and the
Seller notice of the Default within 30 days after it occurs at the expense of
the Issuer. Except in the case of a Default in payment of principal of or
interest on any Note, the Indenture Trustee may withhold the notice to the
Noteholders if and so long as a committee of its Responsible Officers in good
faith determines that withholding the notice is in the interests of
Noteholders. 


          Section
6.6 Reports by Indenture Trustee to Holders.
The Indenture Trustee shall deliver to each Noteholder such information as may
be required to enable such holder to prepare its federal and state income tax
returns. In addition, upon Issuer Request, the Indenture Trustee shall promptly
furnish such information reasonably requested by the Issuer that is reasonably
available to the Indenture Trustee to enable the Issuer to perform its federal
and state income tax reporting obligations. 


          Section
6.7 Compensation
and Indemnity. As compensation for its services hereunder, the Indenture
Trustee shall be entitled to receive, on each Payment Date, the Indenture
Trustee’s Fee pursuant to Section 5.01 of the Sale and Servicing Agreement
(which compensation shall not be limited by any law on compensation of a
trustee of an express trust) and shall be entitled to reimbursement for all
reasonable out of pocket expenses incurred or made by it, including costs of
collection, in addition to the compensation for its services. Such expenses
shall include the reasonable compensation and expenses, disbursements and
advances of the Indenture Trustee’s agents, counsel, accountants and experts.
The Indenture Trustee  shall be indemnified by the Master Servicer, and if not
by the Master Servicer, then by the Trust Estate pursuant to the seventh clause
of Section 5.4 herein against any and all loss, liability or expense (including
attorneys’ fees) incurred by it in connection with the administration of this
trust and the performance of its duties hereunder. The Indenture Trustee shall
notify the Issuer promptly of any claim for which it may seek indemnity.
Failure by the Indenture Trustee to so notify the Issuer shall not relieve the
Issuer of its obligations hereunder. The Issuer shall defend






any such
claim, and the Indenture Trustee may have separate counsel and the Issuer shall
pay the fees and expenses of such counsel. The Indenture Trustee shall not be
entitled to any such reimbursement of any expense or to indemnification against
any loss, liability or expense incurred by the Indenture Trustee through the
Indenture Trustee’s own willful misconduct, negligence or bad faith. Anything
in this Indenture to the contrary notwithstanding, in no event shall the
Indenture Trustee be liable for special, indirect or consequential loss or
damage of any kind whatsoever (including but not limited to lost profits), even
if the Indenture Trustee has been advised of the likelihood of such loss or
damage and regardless of the form of action. This indemnity shall survive the
termination of this Indenture. 


          The
Issuer’s payment obligations to the Indenture Trustee pursuant to this Section
6.7 shall survive the discharge of this Indenture. When the Indenture Trustee
incurs expenses or provides services after the occurrence of a Default
specified in Section 5.1(e) or (f) hereof with respect to the Issuer, the
expenses and fees for such services are intended to constitute expenses of
administration under Title 11 of the United States Code or any other applicable
federal or state bankruptcy, insolvency or similar law. 


          Section
6.8 Replacement
of Indenture Trustee. No resignation or removal of the Indenture Trustee
and no appointment of a successor Indenture Trustee shall become effective
until the acceptance of appointment by the successor Indenture Trustee
acceptable to the Insurer pursuant to this Section. The Indenture Trustee may
resign at any time by so notifying the Issuer and the Insurer. As a condition
to the effectiveness of any such resignation, at least 15 calendar days prior
to the effective date of such resignation, the Indenture Trustee shall provide
(x) written notice to the Depositor of any successor pursuant to this Section
and (y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to the resignation of the Indenture Trustee. The Insurer or the Holders of a
majority in Outstanding Amount of the Notes (with the prior written consent of
the Insurer) may remove the Indenture Trustee by so notifying the Indenture
Trustee and the Insurer (if given by such Noteholders) and may appoint a
successor Indenture Trustee acceptable to the Insurer. The Issuer shall (with
the prior written consent of the Insurer) remove the Indenture Trustee if: 


	
 

	
 


	
 

	
          (a)
  the Indenture Trustee fails to comply with Section 6.11 below; 


	
 

	
 


	
 

	
          (b)
  the Indenture Trustee is adjudged a bankrupt or insolvent; 


	
 

	
 


	
 

	
          (c)
  a receiver or other public officer takes charge of the Indenture Trustee or
  its property; or 


	
 

	
 


	
 

	
          (d)
  the Indenture Trustee otherwise becomes incapable of acting. 





          If
the Indenture Trustee resigns or is removed or if a vacancy exists in the
office of Indenture Trustee for any reason (the Indenture Trustee in such event
being referred to herein as the retiring Indenture Trustee), the Issuer shall
promptly appoint a successor Indenture Trustee with the consent of the Insurer,
which consent shall not be unreasonably withheld. 


          A
successor Indenture Trustee shall deliver a written acceptance of its
appointment to the retiring Indenture Trustee and to the Issuer and shall
provide to the Depositor, in writing and in form and substance reasonably
satisfactory to the Depositor, all information reasonably 






requested by
the Depositor in order to comply with its reporting obligation under Item 6.02
of Form 8-K with respect to the resignation of the Indenture Trustee. Thereupon
the resignation or removal of the retiring Indenture Trustee shall become
effective, and the successor Indenture Trustee shall have all the rights,
powers and duties of the Indenture Trustee under this Indenture. The successor
Indenture Trustee shall mail a notice of its succession to Noteholders. The
retiring Indenture Trustee shall promptly transfer all property held by it as
Indenture Trustee to the successor Indenture Trustee. 


          If
a successor Indenture Trustee does not take office within 60 days after the
retiring Indenture Trustee resigns or is removed, the retiring Indenture
Trustee, the Issuer or the Holders of a majority in Outstanding Amount of the
Notes may petition any court of competent jurisdiction for the appointment of a
successor Indenture Trustee. 


          If
the Indenture Trustee fails to comply with Section 6.11 below, any Noteholder
may (with the consent of the Insurer) petition any court of competent
jurisdiction for the removal of the Indenture Trustee and the appointment of a
successor Indenture Trustee. 


          Notwithstanding
the replacement of the Indenture Trustee pursuant to this Section 6.8, the
Issuer’s obligations under Section 6.7 above shall continue for the benefit of
the retiring Indenture Trustee. 


          Section
6.9 Successor
Indenture Trustee by Merger. If the Indenture Trustee consolidates with,
merges or converts into, or transfers all or substantially all its corporate
trust business or assets to, another corporation or banking association, the
resulting, surviving or transferee corporation without any further act shall be
the successor Indenture Trustee; provided, that such corporation or banking
association shall be otherwise qualified and eligible under Section 6.11 below.
The Indenture Trustee shall provide (x) written notice to the Depositor of any
successor due to merger or consolidation of the Indenture Trustee pursuant to
this Section within five (5) days of the effectiveness of such merger or
consolidation and (y) in writing and in form and substance reasonably
satisfactory to the Depositor, all information reasonably requested by the
Depositor in order to comply with its reporting obligation under Item 6.02 of
Form 8-K with respect to a replacement Indenture Trustee. 


          In
case at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the
certificate of authentication of any predecessor trustee, and deliver such
Notes so authenticated; and in case at that time any of the Notes shall not
have been authenticated, any successor to the Indenture Trustee may
authenticate such Notes either in the name of any predecessor hereunder or in
the name of the successor to the Indenture Trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Notes or in
this Indenture provided that the certificate of the Indenture Trustee shall
have. 


          Section
6.10 Appointment
of Co-Indenture Trustee or Separate Indenture Trustee.


	
 

	
 


	
 

	
          (a)
  Notwithstanding any other provisions of this Indenture, at any time, for the purpose
  of meeting any legal requirement of any jurisdiction in which any part of the
  Trust Estate may at the time be located, the Indenture Trustee shall have the
  power and 











	
 

	
 

	
 


	
 

	
may execute
  and deliver all instruments to appoint one or more Persons to act as a co
  trustee or co trustees, or separate trustee or separate trustees, of all or
  any part of the Trust Estate, and to vest in such Person or Persons, in such
  capacity and for the benefit of the Noteholders and the Insurer, such title
  to the Trust Estate, or any part hereof, and, subject to the other provisions
  of this Section 6.10, such powers, duties, obligations, rights and trusts as
  the Indenture Trustee may consider necessary or desirable. No co trustee or
  separate trustee hereunder shall be required to meet the terms of eligibility
  as a successor trustee under Section 6.11 below and no notice to Noteholders
  of the appointment of any co trustee or separate trustee shall be required
  under Section 6.8 above. 


	
 

	
 


	
 

	
          (b)
  Every separate trustee and co trustee shall, to the extent permitted by law,
  be appointed and act subject to the following provisions and conditions: 


	
 

	
 


	
 

	
 

	
          (i)
  all rights, powers, duties and obligations conferred or imposed upon the
  Indenture Trustee shall be conferred or imposed upon and exercised or
  performed by the Indenture Trustee and such separate trustee or co trustee
  jointly (it being understood that such separate trustee or cc trustee is not
  authorized to act separately without the Indenture Trustee joining in such
  act), except to the extent that under any law of any jurisdiction in which
  any particular act or acts are to be performed the Indenture Trustee shall be
  incompetent or unqualified to perform such act or acts, in which event such
  rights, powers, duties and obligations (including the holding of title to the
  Trust Estate or any portion thereof in any such jurisdiction) shall be
  exercised and performed singly by such separate trustee or co trustee, but
  solely at the direction of the Indenture Trustee; 


	
 

	
 

	
 


	
 

	
 

	
          (ii)
  no trustee hereunder shall be personally liable by reason of any act or
  omission of any other trustee hereunder; and 


	
 

	
 

	
 


	
 

	
 

	
          (iii)
  the Indenture Trustee may at any time accept the resignation of or remove any
  separate trustee or co trustee. 


	
 

	
 

	
 


	
 

	
          (c)
  Any notice, request or other writing given to the Indenture Trustee shall be
  deemed to have been given to each of the then separate trustees and co
  trustees, as effectively as if given to each of them. Every instrument
  appointing any separate trustee or co trustee shall refer to this Agreement
  and the conditions of this Article VI. Each separate trustee and co trustee,
  upon its acceptance of the trusts conferred, shall be vested with the estates
  or property specified in its instrument of appointment, jointly with the
  Indenture Trustee, subject to all the provisions of this Indenture,
  specifically including every provision of this Indenture relating to the conduct of, affecting the liability of,
  or affording protection to, the Indenture Trustee. Every such instrument
  shall be filed with the Indenture Trustee. 


	
 

	
 


	
 

	
          (d)
  Any separate trustee or co trustee may at any time constitute the Indenture
  Trustee, its agent or attorney in fact with full power and authority, to the
  extent not prohibited by law, to do any lawful act under or in respect of
  this Agreement on its behalf and in its name. If any separate trustee or co
  trustee shall die, become incapable of acting, resign or be removed, all of
  its estates, properties, rights, remedies and trusts shall vest in










	
 

	
 


	
 

	
and be
  exercised by the Indenture Trustee, to the extent permitted by law, without
  the appointment of a new or successor trustee. The Indenture Trustee shall
  remain primarily liable for all actions of a co-trustee. 





          Section
6.11 Eligibility:
Disqualification. The Indenture Trustee shall at all times satisfy the
requirements of TIA Section 310(a). The Indenture Trustee shall (i) have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition, (ii) be subject to supervision or
examination by federal or state authority, and (iii) have a credit rating which
would not cause either of the Rating Agencies to reduce their respective then-current
ratings of the Notes (or having provided such security from time to time as is
sufficient to avoid such reduction). The Indenture Trustee shall comply with
TIA. Section 310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9); provided, however, that there shall be
excluded from the operation of TIA Section 310(b)(1) any indenture or
indentures under which other securities of the Issuer are outstanding if the
requirements for such exclusion set forth in TIA Section 310(b)(1) are met. 


          Section
6.12 Preferential
Collection of Claims Against Issuer. The Indenture Trustee shall comply
with TIA Section 311(a), excluding any creditor relationship listed in TIA
Section 31 l (b). An Indenture Trustee who has resigned or been removed shall
be subject to TIA Section 311(a)
to the extent indicated therein. 


          Section
6.13 Representations
and Warranties. The Indenture Trustee hereby represents and warrants that: 


	
 

	
 


	
 

	
          (a)
  The Indenture Trustee is duly organized, validly existing and in good
  standing under the laws of the United States, with power and authority to own
  its properties and to conduct its business as such properties are currently
  owned and such business is currently conducted. 


	
 

	
 


	
 

	
          (b)
  The Indenture Trustee has the power and authority to execute and deliver this
  Indenture and to carry out its terms; and the execution, delivery and
  performance of this indenture have been duly authorized by the Indenture
  Trustee by all necessary corporate action. 


	
 

	
 


	
 

	
          (c)
  The consummation of the transactions contemplated by this Indenture and the
  fulfillment of the terms hereof do not conflict with, result in any breach of
  any of the terms and provisions of, or constitute (with or without notice or
  lapse of time) a default under, the articles of association or bylaws of the
  Indenture Trustee or any agreement or other instrument to which the Indenture
  Trustee is a party or by which it is bound. 





          Section
6.14 Directions
to Indenture Trustee. The Indenture Trustee is hereby directed: 


	
 

	
 


	
 

	
          (a)
  to accept the pledge of the Mortgage Loans and hold the Trust Estate in trust
  for the Noteholders and the Insurer; 


	
 

	
 


	
 

	
          (b)
  to authenticate and deliver the Notes substantially in the form prescribed by
  Exhibit A in accordance with the terms of this Indenture; and 










	
 

	
 


	
 

	
          (c)
  to take all other actions as shall be required to be taken by the terms of
  this Indenture.





          Section
6.15 Indenture
Trustee To Act Solely with Consent of the Insurer. Unless an Insurer
Default exists, the Indenture Trustee shall not, without the Insurer’s consent
or unless directed by the Insurer: 


	
 

	
 


	
 

	
          (a)
  terminate the rights and obligations of the Master Servicer as Master
  Servicer;


	
 

	
 


	
 

	
          (b)
  agree to any amendment pursuant to Section 9 hereof; or 


	
 

	
 


	
 

	
          (c)
  undertake any litigation. 





          The
insurer may, in writing and in its sole discretion renounce all or any of its
rights under this Indenture or any requirement for the Insurer’s consent for
any period of time. 


          Section
6.16 Mortgage
Loans, Trust Estate and Accounts Held for Benefit of the Insurer. The
Indenture Trustee shall hold the Trust Estate and the Mortgage Files for the benefit
of the Noteholders and the Insurer and all references in this Indenture and in
the Class’ Notes to the benefit of Holders of the Notes shall be deemed to
include the Insurer. The Indenture Trustee shall cooperate in all reasonable
respects with any reasonable request by the Insurer for action to preserve or
enforce the Insurer’s rights or interests under this Indenture and the Notes
unless, as stated in an Opinion of Counsel addressed to the Indenture Trustee
and the Insurer, such action is adverse to the interests of the Noteholders or
diminishes the rights of the Noteholders or imposes additional burdens or
restrictions on the Noteholders. 


ARTICLE VII
NOTEHOLDERS’ LISTS AND REPORTS 


          Section
7.1 Issuer
To Furnish Indenture Trustee Names and Addresses of Noteholders. The Issuer
will furnish or cause to be furnished to the Indenture Trustee (a) not more
than five (5) days after the earlier of (i) each Record Date and (ii) three (3)
months after the last Record Date, a list, in such form as the Indenture
Trustee may reasonably require, of the names and addresses of the Noteholders
as of such Record Date, (b) at such other times as the Indenture Trustee and
the Insurer may request in writing, within 30 days after receipt by the Issuer
of any such request, a list of similar form and content as of a date not more
than 10 days prior to the time such list is furnished; provided, however, that
so long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished. 


          Section
7.2 Preservation
of Information; Communications to Noteholders.


	
 

	
 


	
 

	
          (a)
  The Indenture Trustee shall preserve, in as current a form as is reasonably
  practicable, the names and addresses of the Noteholders contained in the most
  recent list furnished to the Indenture Trustee as provided in Section 7.1
  above and the names and addresses of Noteholders received by the Indenture
  Trustee in its capacity as Note Registrar. The Indenture Trustee may destroy
  any list furnished to it as provided in such Section 7.1 upon receipt’of a
  new list so furnished. 










	
 

	
 


	
 

	
          (b)
  Noteholders may communicate pursuant to TIA Section 312(b) with other
  Noteholders with respect to their rights under this Indenture or under the
  Notes. 


	
 

	
 


	
 

	
          (c)
  The Issuer, the Indenture Trustee and the Note Registrar shall have the
  protection of TIA Section 312(c). 





          Section 7.3 Reports by Issuer.


	
 

	
 

	
 


	
 

	
(a) The
  Issuer shall: 


	
 

	
 

	
 


	
 

	
 

	
          (i)
  file with the Indenture Trustee, within 15 days after the Issuer is required,
  pursuant to the Sale and Servicing Agreement, to file the same with the
  Commission, copies of the annual reports and of the information, documents
  and other reports (or copies of such portions of any of the foregoing as the
  Commission may from time to time by rules and regulations prescribe) that the
  Issuer may be required to file with the Commission pursuant to Section 13 or
  15(d) of the Exchange Act; 


	
 

	
 

	
 


	
 

	
 

	
          (ii)
  file with the Indenture Trustee and the Commission in accordance with the
  rules and regulations prescribed from time to time by the Commission such
  additional information, documents and reports with respect to compliance by
  the Issuer with the conditions and covenants of this Indenture as may be
  required from time to time by such rules and regulations; and 


	
 

	
 

	
 


	
 

	
 

	
          (iii) make available to the Indenture
  Trustee (and the Indenture Trustee shall make available to all Noteholders
  described in TIA Section 313(c)) and the Insurer such summaries of any
  information, documents and reports required to be filed by the Issuer
  pursuant to clauses (i) and (ii) of this Section 7.3(a) and by rules and
  regulations prescribed from time to time by the Commission.


	
 

	
 


	
 

	
(b)
  Unless the Issuer otherwise determines, the fiscal year of the Issuer shall
  end on December 31 of each year. 


	
	




          Section
7.4 Reports
by Indenture Trustee. If required by TIA Section 313(a), within 60 days
after each August 1, beginning with 2007, the Indenture Trustee shall mail to
each Noteholder as required by TIA Section 313(c) and to the Insurer a brief
report dated as of such date that complies with TIA Section 313(a). The
Indenture Trustee also shall comply with TIA Section 313(b). 


          A
copy of each report at the time of its mailing to Noteholders shall be provided
by the Indenture Trustee to the Insurer and shall be filed by the Indenture
Trustee with the Commission and each securities exchange, if any, on which the
Notes are listed. The Issuer shall notify the Indenture Trustee if and when the
Notes are listed on any securities exchange. 


ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES


          Section
8.1 Collection
of Money. Except as otherwise expressly provided herein, the Indenture
Trustee may demand payment or delivery of, and shall receive and collect,
directly and 






without
intervention or assistance of any fiscal agent or other intermediary, all money
and other property payable to or receivable by the Indenture Trustee pursuant
to this Indenture. The Indenture Trustee shall apply all such money received by
it as provided in this Indenture. Except as otherwise expressly provided in
this Indenture, if any default occurs in the making of any payment or
performance under any agreement or instrument that is part of the Trust Estate,
the Indenture Trustee may take such action as may be appropriate to enforce
such payment or performance, including the institution and prosecution of
appropriate Proceedings. Any such action shall be without prejudice to any
right to claim a Default or Event of Default under this Indenture and any right
to proceed thereafter as provided in Article V herein. 


          Section
8.2 Accounts,
Distributions.


	
 

	
 


	
 

	
          (a)
  On or prior to the Closing Date, the Indenture Trustee shall establish and
  maintain or cause to be established and maintained, in the name of the
  Indenture Trustee for the benefit of the Noteholders, the Transferor and the
  Insurer, the Distribution Account as provided in Article V of the Sale and
  Servicing Agreement into which amounts shall be deposited in accordance with
  the terms of the Sale and Servicing Agreement. 


	
 

	
 


	
 

	
          (b)
  The Indenture Trustee shall deposit into the Distribution Account any amounts
  representing payments on and any collections in respect of the Mortgage Loans
  received by it, if any, and any other amounts required by the terms of the
  Transaction Documents to be so deposited, immediately following receipt
  thereof, including, without limitation, all amounts withdrawn by the Master
  Servicer from the Collection Account pursuant to Section 3.03 of the Sale and
  Servicing Agreement for deposit to the Distribution Account. Amounts on
  deposit in the Distribution Account may be invested in Eligible Investments
  pursuant to Section 5.06 of the Sale and Servicing Agreement. 


	
 

	
 


	
 

	
          (c)
  On each Payment
  Date and the Redemption Date, to the extent funds are available in the Distribution
  Account, the Indenture Trustee shall make the distributions and payments in
  the amounts and in the priority set forth in Section 5.01 of the Sale and
  Servicing Agreement (except as otherwise provided in Section 5.4(b) above). 


	
 

	
 


	
 

	
          (d)
  On each Payment Date and the Redemption Date, to the extent of the interest
  of the indenture Trustee in the Distribution Account (as described in Section
  5.05 of the Sale and Servicing Agreement), the Indenture Trustee hereby
  authorizes the Paying Agent, as applicable, to make the distributions from
  the Distribution Account as required pursuant to Section 5.01 of the Sale and
  Servicing Agreement. 


	
 

	
 


	
 

	
          (e)
  On or prior to the Closing Date, the Indenture Trustee shall establish
  and maintain or cause to be established and maintained, in the name of the
  Indenture Trustee for the benefit of the Noteholders, the Transferor and the Insurer, the Pre-Funding
  Account and the Capitalized Interest Account as provided in Section 3.17 of
  the Sale and Servicing Agreement. 





          Section
8.3 [Reserved].


          Section
8.4 Master
Servicer’s Monthly Statements. On each Payment Date, the Indenture Trustee
shall make available the Servicing Certificate (as defined in Section 5.03 of 








the Sale and
Servicing Agreement) with respect to such Payment Date to DTC and the Rating
Agencies. 


          Section
8.5 [Reserved].


          Section 8.6 Opinion of Counsel. The
Indenture Trustee shall receive at least seven days notice when requested by
the Issuer to take any action pursuant to Section 2.9(a) above, accompanied by
copies of any instruments involved, and the Indenture Trustee shall also
require with a copy to the Insurer, as a condition to such action, an Opinion
of Counsel, in form and substance satisfactory to the Indenture Trustee,
stating the legal effect of any such action, outlining the steps required to
complete the same, and concluding that all conditions precedent to the taking
of such action have been complied with and such action will not materially and
adversely impair the security for the Notes or the rights of the Noteholders or
the Insurer in contravention of the provisions of this Indenture; provided,
however, that such Opinion of Counsel shall not be required to express an
opinion as to the fair market value of a Trust Estate. Counsel rendering any
such opinion may rely, without independent investigation, on the accuracy and
validity of any certificate or other instrument delivered to the Indenture
Trustee in connection with any such action. 


ARTICLE IX 

SUPPLEMENTAL INDENTURES


	
 

	
 


	
 

	
Section 9.1 Supplemental Indentures Without
  Consent of Noteholders.








	
 

	
 


	
 

	
          (a) Without the consent of the Holders
  of any Notes but with prior notice to the Rating Agencies, the Issuer and the
  Indenture Trustee, when authorized by an Issuer Order, at any time and from
  time to time and only with the prior written consent of the Insurer, may
  enter into one or more indentures supplemental hereto (which shall conform to
  the provisions of the Trust Indenture Act as in force at the date of the
  execution thereof), in form satisfactory to the Indenture Trustee, for any of
  the following purposes: 








	
 

	
 


	
 

	
          (i)
  to correct or amplify the description of any property at any time subject to
  the lien of this Indenture, or better to assure, convey and confirm unto the
  Indenture Trustee any property subject or required to be subjected to the
  lien of this Indenture, or to subject to the lien of this Indenture
  additional property; 


	
 

	
 


	
 

	
          (ii)
  to evidence the succession, in compliance with the applicable provisions
  hereof, of another person to the Issuer, and the assumption by any such
  successor of the covenants of the Issuer herein and in the Notes contained; 


	
 

	
 


	
 

	
          (iii) to add to the covenants of the
  Issuer, for the benefit of the Noteholders or the insurer, or to surrender
  any right or power herein conferred upon the Issuer;


	
 

	
 


	
 

	
          (iv) to convey, transfer, assign,
  mortgage or pledge any property to or with the Indenture Trustee;


	
 

	
 


	
 

	
          (v)
  to cure any ambiguity, to correct or supplement any provision herein or in
  any supplemental indenture that may be inconsistent with any other 










	
 

	
 


	
 

	
provision
  herein or in any supplemental indenture or to make any other provisions with
  respect to matters or questions arising under this Indenture or in any
  supplemental indenture; provided, that such action shall not adversely affect
  the interests of the Noteholders or the Insurer;


	
 

	
 


	
 

	
          (vi) to evidence and provide for the
  acceptance of the appointment hereunder by a successor trustee with respect
  to the Notes and to add to or change any of the provisions of this Indenture
  as shall be necessary to facilitate the administration of the trusts
  hereunder by more than one trustee, pursuant to the requirements of Article
  VI herein; or 


	
 

	
 


	
 

	
          (vii) to modify, eliminate or add to the
  provisions of this Indenture to such extent as shall be necessary to effect
  the qualification of this Indenture under the TIA or under any similar
  federal statute hereafter enacted and to add to this Indenture such other
  provisions as may be expressly required by the TIA. 





          The
Indenture Trustee is hereby authorized to join in the execution of any such
supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained. 


	
 

	
 


	
 

	
          (b) The Issuer and the Indenture
  Trustee, when authorized by an Issuer Order, may, also without the consent of
  any of the Noteholders but with prior consent of the Rating Agencies and the
  insurer, enter into an indenture or indentures supplemental hereto for the
  purpose of adding any provisions to, or changing in any manner or eliminating
  any of the provisions of, this indenture or of modifying in any manner the
  rights of the Noteholders under this Indenture; provided, however, that such
  action shall not, as evidenced by an Opinion of Counsel and satisfaction of
  the Rating Agency Condition, adversely affect in any material respect the
  interests of any Noteholder or the Insurer or cause the Issuer to be subject
  to entity level tax. However, except as provided in the following sentence,
  no such supplemental indenture pursuant to this Section shall (i) conflict
  with the provisions of Section 9.2 or (ii) without the consent of a Majority
  in Interest of the Notes, permit the Issuer to (A) modify the definition of
  the term “Eligible Investments” except as provided therein, to expand the
  types of Eligible investments specified in that definition, (B) enter into a
  derivative contract for the benefit of the Noteholders or (C) increase (x)
  the Transferor ’s discretion in the selection of accounts to be transferred to
  the Transferor or (y) the frequency of such transfer under Section 2.09 of
  the Sale and Servicing Agreement. However, the preceding sentence shall not
  prevent the adoption without Noteholder consent of any supplemental indenture
  descri bed in clause (ii) thereof, if (i) that supplemental indenture
  otherwise satisfies the first sentence of this Section 9.1(b) and (ii) the
  adoption of that supplemental indenture (a) is necessary to correct a
  manifest error in a Transaction Document, (b) is necessary to conform the
  terms of any Transaction Document to the terms of the Notes described in the
  Prospectus Supplement, where such Transaction Document and the Prospectus
  Supplement are inconsistent, (c) is required by the Rating Agencies or (d)
  is, as evidenced by the written opinion of the Master Servicer’s internal
  accountants, delivered and acceptable to the Indenture Trustee, necessary to
  comply with or to conform to then-current financial accounting standards. 










          Section
9.2 Supplemental
Indentures with Consent of Noteholders. The Issuer and the Indenture
Trustee, when authorized by an Issuer Order, also may, with prior consent of
the Rating Agencies and the Insurer, and with the consent of the Holders of not
less than a majority of the Outstanding Amount of the Notes, by Act of such
Holders delivered to the Issuer and the Indenture Trustee, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Holders of
the Notes under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Note
affected thereby: 


	
 

	
 


	
 

	
          (a) change the date of payment of any
  installment of principal of or interest on any Note, or reduce the principal
  amount thereof, the interest rate thereon or the amount required to be paid
  on the Notes following the exercise of the option set forth in Section 8.01
  of the Sale and Servicing Agreement, change the provisions of this Indenture
  relating to the application of collections on, or the proceeds of the sale
  of, the Trust Estate to payment of principal of or interest on the Notes, or
  change any place of payment where, or the coin or currency in which, any Note
  or the interest thereon is payable, or impair the right to institute suit for
  the enforcement of the provisions of this Indenture requiring the application
  of funds available therefor, as provided in Article V herein, to the payment
  of any such amount due on the Notes on or after the respective due dates thereof
  (or, in the case of redemption, on or after the Redemption Date); 


	
 

	
 


	
 

	
          (b) reduce the percentage of the
  Outstanding Amount of the Notes, the consent of the Holders of which is
  required for any such supplemental indenture, or the consent of the Holders
  of which is required for any waiver of compliance with certain provisions of
  this Indenture or certain defaults hereunder and their consequences provided
  for in this Indenture; 


	
 

	
 


	
 

	
          (c) modify or alter the provisions of
  the proviso to the definition of the term “Outstanding”; 


	
 

	
 


	
 

	
          (d) reduce the percentage of the
  Outstanding Amount of the Notes required to direct the indenture Trustee to
  direct the Issuer to sell or liquidate the Trust Estate pursuant to Section
  5A above; 


	
 

	
 


	
 

	
          (e) modify any provision of this
  Section except to increase any percentage specified herein or to provide that
  certain additional provisions of this Indenture or the Transaction Documents
  cannot be modified or waived without the consent of the Holder of each
  Outstanding Note affected thereby; 


	
 

	
 


	
 

	
          (f) modify
  any of the provisions of this Indenture in such manner as to affect the
  calculation of the amount of any payment of interest or principal due on any
  Note on any Payment Date (including
  the calculation of any of the individual components of such calculation); or 


	
 

	
 


	
 

	
          (g) permit
  the creation of any lien tanking prior to or on a panty with the lien of this
  indenture with respect to any part of the Trust Estate or, except as
  otherwise expressly permitted or contemplated herein, terminate the lien of
  this Indenture on any property at any time subject hereto or deprive the
  Holder of any Note of the security 










	
 

	
 


	
 

	
provided by
  the lien of this Indenture;
  provided further, that such action shall not, as evidenced by an Opinion of
  Counsel, cause the Issuer to be subject to an entity level tax. 





          In
connection with requesting the consent of the Noteholders pursuant to this
Section 9.2, the Indenture Trustee shall mail to the Holders of the Notes to
which such amendment or supplemental indenture relates a notice setting forth
in general terns the substance of such supplemental indenture at the Issuer’s
expense. It shall not be necessary for any Act of Noteholders under this
Section 9.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof. 


          Section
9.3 Execution
of Supplemental Indentures. In executing, or permitting the additional
trusts created by, any supplemental indenture permitted by this Article IX or
the modification thereby of the trusts created by this Indenture, the Indenture
Trustee shall be entitled to receive, and subject to Sections 6.1 and 6.2,
shall be fully protected in relying upon, an Opinion of Counsel stating that
the execution of such supplemental indenture is auth6rized or permitted by this
Indenture and all conditions precedent to the execution of such supplemental indenture have been met. The Indenture
Trustee may, but shall not be obligated to, enter into any such supplemental
indenture that affects the Indenture Trustee’s own rights, duties, liabilities
or immunities under this Indenture or otherwise. 


          Section
9.4 Effect
of Supplemental Indenture. Upon the execution of any supplemental indenture
pursuant to the provisions hereof, this Indenture shall be deemed to be
modified and amended in accordance therewith with respect to the Notes affected
thereby, and the respective rights, limitations of rights, obligations, duties,
liabilities and immunities under this Indenture of the Indenture Trustee, the
Issuer and the Holders of the Notes shall thereafter be determined, exercised
and enforced hereunder subject in all respects to such modifications and
amendments, and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes. 


          Section
9.5 Conformity
with Trust Indenture Act. Every amendment of this Indenture and every
supplemental indenture executed pursuant to this Article IX shall conform to
the requirements of the Trust Indenture Act as then in effect so long as this
Indenture shall then be qualified under the Trust Indenture Act. 


          Section
9.6 Reference
in Notes to Supplemental Indentures. Notes authenticated and delivered
after the execution of any supplemental indenture pursuant to this Article IX
may, and if required by the Indenture Trustee shall, bear a notation in form
approved by the Indenture Trustee as to any matter provided for in such
supplemental indenture. If the Issuer or the indenture Trustee shall so
determine, new Notes so modified as to conform, in the opinion of the Indenture
Trustee and the Issuer, to any such supplemental indenture may be prepared and
executed by the Issuer and authenticated and delivered by the Indenture Trustee
in exchange for Outstanding Notes. 


ARTICLE X

REDEMPTION OF NOTES


          Section
10.1 Redemption.
The Master Servicer may effect an early termination of the Notes pursuant to
Section 8.01 of the Sale and Servicing Agreement on or after any Payment Date
on which the Note Principal Balance is less than or equal to 10% of the
Original Note 






Principal
Balance by purchasing, on the next succeeding Payment Date, all of the
outstanding Mortgage Loans and REO Properties at the Termination Price,
pursuant to the provisions of Section 8.01(b) of the Sale and Servicing
Agreement. 


          The
Indenture Trustee shall furnish notice of any such redemption in accordance
with Section 8.01 of the Sale and Servicing Agreement. 


ARTICLE XI

MISCELLANEOUS


	
 

	
 


	
 

	
Section 11.1 Compliance Certificates and
  Opinions, etc.








	
 

	
 


	
 

	
          (a) Upon any application or request by
  the Issuer made to the Indenture Trustee to take any action under any
  provision of this Indenture, the Issuer shall furnish to the Indenture
  Trustee and to the Insurer (i) an Officer’s Certificate stating that all
  conditions precedent, if any, provided for in this Indenture relating to the
  proposed action have been complied with, (ii) an Opinion of Counsel stating
  that in the opinion of such counsel all such conditions precedent, if any,

  have been complied with and (iii) (if required by the TIA) an Independent
  Certificate from a firm of certified public accountants meeting the
  applicable requirements of this Section 11, except that, in the case of any
  such application or request as to which the furnishing of such documents is
  specifically required by any provision of this Indenture, no additional
  certificate or opinion need be furnished. 





          Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include: 


	
 

	
 


	
 

	
          (i) a
  statement that each signatory of such certificate or opinion has read or has
  caused to be read such covenant or condition and the definitions herein
  relating thereto; 


	
 

	
 


	
 

	
          (ii) a
  brief statement as to the nature and scope of the examination or
  investigation upon which the statements or opinions contained in such
  certificate or opinion are based; a statement that, in the opinion of each such signatory, such
  signatory has made such examination or investigation as is necessary to
  enable such signatory to express an informed opinion as to whether or not
  such covenant or condition has been complied with; and 


	
 

	
 


	
 

	
          (iii) a statement as to whether, in the opinion
  of each such signatory, such condition or covenant has been complied with.








	
 

	
 


	
 

	
          (b) (i)
  Prior to the deposit of any Collateral or other property or securities with
  the Indenture Trustee that is to be made the basis for the release of any
  property or securities subject to the lien of this Indenture (except in the
  case of the release of Mortgage Loans in accordance with the Sale and
  Servicing Agreement), the Issuer shall, in addition to any obligation imposed
  in Section 11.1(a) herein or elsewhere in this Indenture, furnish to the
  Indenture Trustee an Officer’s Certificate certifying or stating the opinion
  of each person signing such
  certificate as to the fair value (within 90 days of such deposit) to the
  Issuer of the Collateral or other property or securities to be so deposited. 










	
 

	
 


	
 

	
          (ii)
  Whenever the Issuer is required to furnish to the Indenture Trustee an
  Officer’s Certificate certifying or stating the opinion of any signer thereof
  as to the matters described in clause (i) above, the Issuer shall also
  deliver to the Indenture Trustee an independent Certificate as to the same
  matters, if the fair value to the Issuer of the Collateral, other property or
  securities to be so deposited and of all other such Collateral, other
  property or securities made the basis of any such withdrawal or release since
  the commencement of the then current fiscal year of the Issuer, as set forth
  in the certificates delivered pursuant to clause (i) above and this clause
  (ii), is 10% or more of the aggregate Note Principal Balance of the Notes,
  but such a certificate need not be furnished with respect to any securities so
  deposited, if the fair value thereof to the Issuer as set forth in the
  related Officer’s Certificate is less than either (A) $25,000 or (B) one
  percent of the aggregate Note Principal Balance of the Notes. 


	
 

	
 


	
 

	
          (iii)
  Whenever any property or securities are to be released from the lien of this
  Indenture, the Issuer shall also furnish to the Indenture Trustee an
  Officer’s Certificate certifying or stating the opinion of each person
  signing such certificate as to the fair value (within 90 days of such
  release) of the property or securities proposed to be released and stating
  that in the opinion of such person the proposed release will not impair the
  security under this Indenture in contravention of the provisions hereof. 


	
 

	
 


	
 

	
          (iv)
  Whenever the Issuer is required to furnish to the Indenture Trustee an
  officer’s Certificate certifying or stating the opinion of any signer thereof
  as to the matters described in clause (iii) above, the Issuer shall also
  furnish to the Indenture Trustee an Independent Certificate as to the same
  matters if the fair value of the property or securities and of all other
  property or securities released from the lien of this Indenture since the
  commencement of the then current calendar year, as set forth in the certificates
  required by clause (iii) above and this clause (iv), equals 10% or more of
  the aggregate Note Principal Balance of the Notes, but such certificate need
  not be furnished in the case of any release of property or securities if the
  fair value thereof as set forth in the related Officer’s Certificate is less than $25,000 or
  less than one percent of the then aggregate Note Principal Balance of the
  Notes. 





          Section
11.2 Form
of Documents Delivered to Indenture Trustee. In any case where several matters
are required to be certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified by, or covered
by the opinion of, only one such Person, or that they be so certified or
covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents. 


          Any
certificate or opinion of an Authorized Officer of the Issuer may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the matters upon
which such officer’s certificate or opinion is based are erroneous. Any such
certificate of an Authorized Officer or Opinion of 






Counsel may be
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, an officer or officers of the Master Servicer, the
Transferor or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Master Servicer, the Transferor or
the Issuer, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous. 


          Where
any Person is required to make, give or execute two or more applications,
requests, consents, certificates, statements, opinions or other instruments
under this Indenture, they may, but need not, be consolidated and form one
instrument. 


          Whenever
in this Indenture, in connection with any application or certificate or report
to the Indenture Trustee, it is provided that the Issuer shall deliver any
document as a condition of the granting of such application, or as evidence of
the Issuer’s compliance with any term hereof, it is intended that the truth and
accuracy, at the time of the granting of such application or at the effective
date of such certificate or report (as the case may be), of the facts and
opinions stated in such document shall in such case be conditions precedent to
the right of the Issuer to have such application granted or to the sufficiency
of such certificate or report. The foregoing shall not, however, be construed
to affect the Indenture Trustee’s right to rely upon the truth and accuracy of
any statement or opinion contained in any such document as provided in Article
VI hereof. 


	
 

	
 


	
 

	
Section 11.3 Acts of Noteholders.








	
 

	
 


	
 

	
          (a) Any request, demand,
  authorization, direction, notice, consent, waiver or other action provided by
  this Indenture to be given or taken by Noteholders may be embodied in and
  evidenced by one or more instruments of substantially similar tenor signed by
  such Noteholders in person or by agents duly appointed in writing; and except
  as herein otherwise expressly provided such action shall become effective
  when such instrument or instruments are delivered to the Indenture Trustee,
  and, where it is hereby expressly required, to the Issuer. Such instrument or
  instruments (and the action embodied therein and evidenced thereby) are
  herein sometimes referred to as the “Act” of the Noteholders signing such
  instrument or instruments. 





Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section
6.1 hereof) conclusive in favor of the Indenture Trustee and the Issuer, if
made in the manner provided in this Section 11.3. 


	
 

	
 


	
 

	
          (b) The fact and date of the execution
  by any person of any such instrument or writing may be proved in any manner
  that the Indenture Trustee deems sufficient. 


	
 

	
 


	
 

	
          (c) The ownership of Notes shall be
  proved by the Note Register.


	
 

	
 


	
 

	
          (d) Any request, demand,
  authorization, direction, notice, consent, waiver or other action by the Holder
  of any Notes shall bind the Holder of every Note issued upon the registration
  thereof or in exchange therefor or in lieu thereof, in respect of anything
  .done, omitted or suffered to be done by the Indenture Trustee or the Issuer
  in reliance thereon, whether or not notation of such action is made upon such
  Note.












          Section
11.4 Notices. Any request, demand, authorization, direction, notice,
consent, waiver or Act of Noteholders or other documents provided or permitted
by this Indenture shall be in writing and if such request, demand,
authorization, direction, notice, consent, waiver or Act of Noteholders is to
be made upon, given or furnished to or filed with:


	
 

	
 


	
 

	
          (a)
  the Indenture Trustee by any Noteholder or by the Issuer shall be sufficient
  for every purpose hereunder if made, given, furnished or filed in writing to
  or with the Indenture Trustee at its Corporate Trust Office, the Indenture
  Trustee shall promptly transmit any notice received by it from the
  Noteholders or the Issuer to the Insurer, or


	
 

	
 


	
 

	
          (b)
  the Issuer by the Indenture Trustee or by any Noteholder shall be sufficient
  for every purpose hereunder if in writing and mailed first class, postage
  prepaid to the Issuer addressed to: First Horizon ABS Trust 2007-HE1, in care
  of Wilmington Trust Company, as Owner Trustee, Rodney Square North, 1100
  North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate
  Trust Department; and to the Master Servicer addressed to: First Tennessee
  Bank National Association, 165 Madison Avenue, 8th Floor, Memphis,
  Tennessee 38103, Attention: Mr. Charles Rutledge, or at any other address
  previously furnished in writing to the Indenture Trustee by the Issuer or the
  Administrator. The Issuer shall promptly transmit any notice received by it
  from the Noteholders to the Indenture Trustee and from the Noteholders, the
  Indenture Trustee or the Issuer to the insurer.


	
 

	
 


	
 

	
          (c)
  the Insurer, by the Issuer, the Indenture Trustee or by any Noteholders shall
  be sufficient for every purpose hereunder to in writing and mailed,
  first-class postage pre-paid, or personally delivered to: 31 West 52nd
  Street, New York, NY 10019, Attention: Managing Director – Transaction
  Oversight, Re: First Horizon HELOC Notes, Series 2007-HE1, Facsimile: (212)
  339-3518, Confirmation: (212) 826,0100 (in each case in which notice or other
  communication to the Insurer refers to an Event of Default, a claim on the
  Policy or with respect to which failure on the part of the Insurer to respond
  shall be deemed to constitute consent or acceptance, then a copy of such notice
  or other communication should also be sent to the attention of the general
  counsel of the Insurer, in all cases, both any original and all copies shall
  be marked to indicate “URGENT MATERIAL ENCLOSED”. The Insurer shall promptly
  transmit any notice received by it from the Issuer, the Indenture Trustee or
  the Noteholders to the Issuer or Indenture Trustee, as the case may be.





          Notices
required to be given to the Rating Agencies by the Indenture Trustee or the
Owner Trustee shall be in writing, personally delivered or mailed by certified
mail, return receipt requested, to (i) in the
case of Standard & Poor’s, at the following address: 55 Water Street, New
York, New York 10041 and (ii) in the case of Moody’s, at the following address:
99 Church Street, 6th Floor, New York, New York 10007, Attention: Residential
Mortgage Monitoring; or as to each of the foregoing, at such other address as
shall be designated by written notice to the other parties.


          Section
11.5 Notices to Noteholders, Waiver. Where this Indenture provides for notice
to Noteholders of any event, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and mailed, first class,
postage prepaid to each Noteholder affected by such event, at his address as it
appears on the Note Register, not later than
the latest  






date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given
by mail, neither the failure to mail such notice nor any defect in any notice so mailed to any particular
Noteholder shall
affect the sufficiency of such notice
with respect to other Noteholders, and any notice that is mailed in the manner
herein provided shall conclusively be presumed to have been duly given.


          Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by any Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Noteholders shall be filed with the Indenture Trustee but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such a waiver.


          In case, by
reason of the suspension of regular mail service as a result of a strike, work
stoppage or similar activity, it shall be impractical to mail notice of any
event to Noteholders when such notice is required to be given pursuant to any
provision of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving
of such notice.


          Where this
Indenture provides for notice to the Rating Agencies, failure to give such
notice shall not affect any other rights or obligations created hereunder.


          Section
11.6 Rights of the Insurer to Exercise Rights of Noteholders. By
accepting its Note, each Noteholder agrees that unless an Insurer Default exists, the Insurer shall have the
right to
exercise all rights of the Noteholders as specified under this Agreement
without any further consent of the Noteholders. Any right conferred to the
Insurer hereunder shall be suspended and shall run to the benefit of the
Noteholders during any period in which there exists an Insurer Default,
provided, however, that during an Insurer Default, the consent of the Insurer
must be obtained with respect to any amendments that may materially adversely
affect the Insurer. Upon the payment of any Insurance Policy Payment Amount in
accordance with the terms of the Insurance Policy, the Insurer shall be fully
subrogated to the rights of the Noteholders to receive the amount so paid and
shall be deemed to be a Noteholder with respect thereto.


          Section
11.7 Conflict with Trust Indenture Act. If any provision hereof limits,
qualifies or conflicts with another provision hereof that is required to be
included in this Indenture by any of the provisions of the Trust Indenture Act,
such required provision shall control.


          The
provisions of TIA Sections 310 through 317 that impose duties on any person
(including the provisions automatically deemed included herein unless expressly
excluded by this Indenture) are a part of and govern this Indenture, whether or
not physically contained herein.


          Section
11.8 Effect of Headings and Table of Contents. The Article and Section
headings herein and the Table of Contents are for convenience only and shall
not affect the construction hereof.


          Section
11.9 Successors and Assigns. All covenants and agreements in this
Indenture and the Notes by the Issuer shall bind its successors and assigns,
whether so expressed or not. All






agreements of
the Indenture Trustee in this Indenture shall bind its successors, co trustees
and agents.


          Section
11.10 Separability. In
case any provision in this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.


          Section
11.11 Benefits of Indenture. Nothing in this Indenture or in the Notes,
express or implied, shall give to any Person, other than the parties hereto and
their successors hereunder, and the
Noteholders, the Insurer, and any other party secured hereunder,
and any other Person with an ownership
interest in any part of the Trust
Estate, any benefit or any legal or equitable right, remedy or claim
under this Indenture.


          Section
11.12 Legal Holidays. In any case where the date on which any payment
isdue shall not be a Business Day, then
(notwithstanding any other provision of the Notes or this Indenture)
payment need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the date on which nominally due, and no interest shall
accrue
for the period from and after any such nominal date.


          Section
11.13 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF
LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMR-4ED IN ACCORDANCE WITH SUCH LAWS.


          Section
11.14 Counterparts. his Indenture may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.


          Section
11.15 Recording of Indenture.
If this Indenture is subject to recording
in any appropriate public recording offices,
such recording is to be effected by the Issuer and at its expense
accompanied by an Opinion of Counsel (which may be counsel to the Indenture
Trustee or any other counsel reasonably
acceptable to the Indenture Trustee) to the effect that such recording is
necessary either for the protection of the Noteholders, the Insurer or any
other Person secured hereunder
or for the enforcement of any right
or remedy granted to the Indenture Trustee
under this Indenture.


          Section
11.16 Trust Obligation. No recourse may be taken, directly or indirectly,
with respect to the obligations of the Issuer, the Owner Trustee or the
Indenture Trustee on the Notes or under this
Indenture or any certificate or other writing delivered in connection herewith
or therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director, employee or
agent of the Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed (it being understood that the Indenture Trustee and the Owner
Trustee have no such obligations in their 






individual capacity) and except that any such partner, owner or
beneficiary shall be fully liable, to the extent provided by applicable law,
for any unpaid consideration for stock, unpaid capital contribution or
failure to pay any installment or call owing to such entity. For all purposes
of this Indenture, in the performance of any duties or obligations of the
Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the
benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust
Agreement.


          Section
11.17 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time institute against the Transferor (and any
wholly-owned subsidiary thereof), the Depositor, the Master Servicer or the
Issuer, or join in any institution against the Transferor (and any wholly-owned
subsidiary thereof), the Depositor, the Master Servicer or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to the Notes, this
Indenture or any of the Transaction Documents.


          Section
11.18 Inspection. The Issuer shall, upon the reasonable request of the
Indenture Trustee or Insurer, permit the Indenture Trustee or Insurer or their
authorized agents, or cause the Indenture Trustee or Insurer or their
authorized agents to be permitted (in the case of the Issuer) to inspect the
books and records of the Issuer as they may relate to the Notes, the
obligations of the Issuer under the Transaction Documents to which it is a
party and the Transaction. Such inspections and discussions shall be conducted
during normal business hours and shall not unreasonably disrupt the business of
the Issuer. The books and records of the Issuer shall be maintained at the
address of the Issuer designated in this Indenture for receipt of notices.


          Section
11.19 Inconsistencies With the Sale and Servicing Agreement. In the
event certain provisions of this Agreement conflict with the provisions of the
Sale and Servicing Agreement, the parties hereto agree that the provisions of
the Sale and Servicing Agreement shall be controlling.


          Section
11.20 Third Party Beneficiaries. This Indenture will inure to the
benefit of and be binding upon the parties hereto, the Noteholders, the Note
Owners, the Insurer and their respective successors and permitted assigns.
Except as otherwise provided in this Indenture, no other person will have any
right or obligation hereunder.






          IN
WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused this Indenture to be duly executed by their
respective
officers, thereunto duly authorized and duly attested, all as of the day
and year first above written.


	
 

	
 

	
 


	
 

	
FIRST
  HORIZON ABS TRUST 2007-HE1


	
 

	
 

	
 


	
 

	
By:

	
Wilmington
  Trust Company,


	
 

	
 

	
not in its
  individual capacity but


	
 

	
 

	
solely as
  Owner Trustee


	
 

	
 

	
 


	
 

	
By:

	
 


	
 

	
 

	



	
 

	
Name:


	
 

	
Title:


	
 

	
 


	
 

	
THE BANK OF
  NEW YORK,
not in its individual capacity but solely as Indenture Trustee


	
 

	
 


	
 

	
By:

	
 


	
 

	
 

	



	
 

	
Name:


	
 

	
Title:










	
 

	
 

	
 


	
STATE OF
  DELAWARE

	
)

	
 


	
 

	
)

	
ss:


	
COUNTY OF
  NEWCASTLE

	
)

	
 





          BEFORE
ME, the undersigned authority, a Notary Public in and for said county and
state, on this day personally appeared _________________________ known to me to
be the person and officer whose name is subscribed to the foregoing instrument
and acknowledged to me that the same was the act of the said WILMINGTON TRUST
COMPANY, not in its individual capacity, but solely as Owner Trustee on behalf
of FIRST HORIZON ABS TRUST 2007-HE1, a Delaware statutory trust, and that such
person executed the same as the act of said statutory trust for the purpose and
consideration therein expressed, and in the capacities therein stated.


          GIVEN
UNDER MY HAND AND SEAL OF OFFICE, this ___ day of June, 2007.


	
 

	
 


	
 

	



	
 

	
Notary
  Public in and for the State of Delaware








	
 

	
 


	
(Seal)

	
 


	
 

	
 


	
My
  commission expires:

	
 


	
 

	
 


	


	
 










	
 

	
 

	
 


	
STATE OF NEW
  YORK

	
)

	
 


	
 

	
)

	
ss:


	
COUNTY OF
  NEW YORK

	
)

	
 





          BEFORE ME, the
undersigned authority, a Notary Public in and for said county and state, on
this day personally appeared _________________________ known to me to be the
person and officer whose name is subscribed to the foregoing instrument and
acknowledged to me that the same was the act of THE BANK OF NEW YORK, a New
York banking corporation, and that such person executed the same as the act of
said statutory trust for the purpose and consideration therein expressed, and
in the capacities therein stated.


          GIVEN
UNDER MY HAND AND SEAL OF OFFICE, this ___ day of June, 2007.


	
 

	
 


	
 

	



	
 

	
Notary
  Public in and for the State of New York








	
 

	
 


	
(Seal)

	
 


	
 

	
 


	
My
  commission expires:

	
 


	
 

	
 


	


	
 












SCHEDULE A


MORTGAGE LOAN SCHEDULE


[Available Upon Request]






EXHIBIT A

FORM OF NOTES


UNLESS THIS
NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC” ), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.


THE PRINCIPAL
OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE
AMOUNT SHOWN ON THE FACE HEREOF.


	
 

	
 


	
No.

	
CUSIP
  NO. 32053J AA5


	
 

	
 


	
Aggregate
  Class Note Principal Balance:

	
Denomination
  of this Note:


	
$307,000,000

	
$307,000,000





FIRST HORIZON ABS TRUST 2007-HE1


FIRST HORIZON HELOC NOTES, SERIES 2007-HE1


          FIRST
HORIZON ABS TRUST 2007-HE1, a statutory trust organized and existing under the laws of the State of Delaware (herein
referred to as the “Trust”), for
value received, hereby promises to pay to Cede & Co., or registered
assignees, the principal sum of $THREE HUNDRED SEVEN MILLION AND NO/100 DOLLARS
($307,000,000) payable on each Payment Date in an amount equal to the result
obtained by multiplying (i) a fraction the numerator of which is the initial
principal amount of this Note and the denominator of which is the aggregate
principal amount of all Notes by (ii) the aggregate amount, if any, payable
from the Distribution Account in respect of principal on the Note pursuant to
Section 5.01 of the Sale and Servicing Agreement dated as of June 1, 2007 (the
“Sale and Servicing Agreement”), among the Trust, First Horizon Asset
Securities Inc., as Depositor (the “Depositor”), First Tennessee Bank National
Association as Seller and Master Servicer (“FTBN”), and The Bank of New York, a
New York banking corporation, as Indenture Trustee (the “Indenture Trustee”);
provided, however, that the entire unpaid principal amount of this Note shall
be due and payable on the earliest to occur of (i) the Payment Date occurring
in September 2029 (the “Final Maturity Date”), (ii) any termination date
pursuant to Section 8.01 of the Sale and Servicing Agreement or (iii) the date
on which an Event of Default under the Indenture dated as of June 1, 2007,
between the Trust and the Indenture Trustee shall have occurred and be
continuing, if the Insurer or the Indenture Trustee or the Holders of Notes
representing not less than a majority of the Outstanding Amount of the Notes, in
either such case with the written consent of the Insurer, 






have declared
the Notes to be immediately due and payable in the manner provided in Section
5.2 of the Indenture. Capitalized terms used but not defined herein are defined
in Article I of the Indenture, which also contains rules as to construction
that shall be applicable herein.


          The
Trust will pay interest on this Note at the rate per annum described in the
Sale and Servicing Agreement with respect to the Note on the principal amount
of this Note outstanding on the preceding Payment Date (after giving effect to
all payments of principal made on the preceding Payment Date) on each Payment
Date until the principal of this Note is paid or made available for payment in
full. Interest on this Note will accrue for each Payment Date during the period
from the preceding Payment Date to the day preceding such Payment Date (or, in
the case of the first Payment Date, the period from the Closing Date to the day
preceding the First Payment Date) (each, an “Interest Accrual Period”).
Interest will be computed on the basis of the actual number of days in each
Interest Accrual Period and a 360-day year. Such principal of and interest on
this Note shall be paid in the manner specified on the reverse hereof.


          The
principal of and interest on this Note are payable in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Trust with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal) of this Note.


          Reference
is made to the further provisions of this Note set forth on the reverse hereof,
which shall have the same effect as though fully set forth on the face of this
Note.


          Unless
the certificate of authentication hereon has been executed by the Indenture
Trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture referred to on the reverse hereof,
or be valid or obligatory for any purpose.






          IN
WITNESS WHEREOF, the Trust has caused this instrument to be signed, manually or
in facsimile, by its Authorized Officer, as of the date set forth below.


Date: ________
___, 20__


	
 

	
 

	
 

	
 


	
 

	
FIRST
  HORIZON ABS TRUST 2007-HE1


	
 

	
 


	
 

	
By: 

	
Wilmington
  Trust Company, 

  not in its individual capacity but

  solely as Owner Trustee


	
 

	
 

	
 

	
 


	
 

	
 

	
By:  

	
 


	
 

	
 

	
 

	



	
 

	
 

	
Name:


	
 

	
 

	
Title:





INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION


          This
is one of the Notes designated above and referred to in the within mentioned
Indenture.


Date: ________
_____, 20__


	
 

	
 

	
 


	
 

	
THE BANK OF
  NEW YORK, 

  not in its individual capacity but

  solely as Indenture Trustee


	
 

	
 

	
 


	
 

	
By:  

	
 


	
 

	
 

	



	
 

	
Name:


	
 

	
Title:










(REVERSE OF NOTE)


          This
Note is one of a duly authorized issue of Notes of the Trust, designated as its
First Horizon HELOC Notes, Series 2007-HE1, all issued under the Indenture, to
which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights and obligations thereunder of the
Trust, the Indenture Trustee and the Holders of the Notes. The Notes are
subject to all terms of the Indenture.


          The
Notes are and will be secured by the collateral pledged as security therefor as
provided in the Indenture.


          Principal
of the Notes will be payable on each Payment Date in an amount described on the
face hereof. “Payment Date” means the 25th day of each month, or, if any such date
is not a Business Day, the next succeeding Business Day, commencing in June
2007.


          As
described above, the entire unpaid principal amount of this Note shall be due
and payable on the earlier of the Final Maturity Date and any termination date
pursuant to Section 8.01 of the Sale and Servicing Agreement. Notwithstanding
the foregoing, the entire unpaid principal amount of the Notes shall be due and
payable on the date on which an Event of Default under the Indenture shall have
occurred and be continuing and the Insurer or the Indenture Trustee, at the
direction or upon the prior written consent of the Holders of the Notes I
representing not less than a majority of the Outstanding Amount of the Notes
and with the written consent of the Insurer, shall have declared the Notes to
be immediately due and payable in the manner provided in Section 5.2 of the
Indenture. All principal payments on the Notes shall be made pro rata to the
Holders of the Notes entitled thereto.


          Payments
of interest on this Note due and payable on each Payment Date, together with
the related installment of principal, if any, to the extent not in full payment
of this Note, shall be made by wire transfer of immediately available funds to,
or by check mailed to, the Person whose name appears as the Registered Holder
of this Note (or one or more Predecessor Notes) on the Note Register as of the
close of business on each Record Date, except that with respect to Notes
registered on the Record Date in the name of the nominee of the Clearing Agency
(initially, such nominee to be Cede & Co.), payments will be made by wire
transfer in immediately available funds to the account designated by such
nominee. Such checks shall be mailed to the Person entitled thereto at the
address of such Person as it appears on the Note Register as of the applicable
Record Date without requiring that this Note be submitted for notation of
payment. Any reduction in the principal amount of this Note (or any one or more
Predecessor Notes) effected by any payments made on any Payment Date shall be
binding upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not noted hereon. If funds are expected to be available, as provided
in the Indenture, for payment in full of the then remaining unpaid principal
amount of this Note on a Payment Date, then the Indenture Trustee, in the name
of and on behalf of the Trust, will notify the Person who was the Registered
Holder hereof as of the Record Date preceding such Payment Date by notice
mailed or transmitted by facsimile prior to such Payment Date, and the amount
then due and payable shall be payable only upon presentation and surrender of this Note at
the Indenture Trustee’s principal Corporate Trust Office or at the office of
the Indenture Trustee’s agent appointed for such purposes located in New York,
New York.






          As
provided in the Sale and Servicing Agreement, the Notes may be redeemed in
whole, but not in part, at the option of the Master Servicer, on any Payment
Date on and after the date on which the Note Principal Balance is less than or
equal to 10% of the Original Note Principal Balance.


          As
provided in the Indenture and subject to certain limitations set forth therein,
the transfer of this Note may be registered on the Note Register upon surrender
of this Note for registration of transfer at the office or agency designated by
the Trust pursuant to the Indenture, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Holder hereof or such Holder’s attorney duly authorized
in writing, with such signature guaranteed by an “eligible guarantor
institution” meeting the requirements of the Note Registrar, which requirements
include membership or participation in the Securities Transfer Agent’s
Medallion Program (“STAMP”) or such other “signature guarantee program” as may
be determined by the Note Registrar in addition to, or in substitution for,
STAMP, all in accordance with the Securities Exchange Act of 1934, as amended,
and thereupon one or more new Notes of authorized denominations and in the same
aggregate principal amount will be issued to the designated transferee or
transferees. No service charge will be charged for any registration of transfer
or exchange of this Note, but the Trust may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any such registration of transfer or exchange. By acquiring this Note, the
Noteholder hereof shall be deemed to represent and warrant that either (a) it
is not acquiring the Note with the plan assets of an “employee benefit plan” as
defined in Section 3(3) of ERISA, which is subject to Title I of ERISA, or a
“plan” as defined in Section 4975 of the Code; of (b) the acquisition and
holding of the Note will not give rise to a nonexempt prohibited transaction
under Section 406(a) of ERISA or Section 4975 of the Code.


          Each
Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note
Owner, a security entitlement with respect to a Note, covenants and agrees that
no recourse may be taken, directly or indirectly, with respect to the
obligations of the Trust, the Owner Trustee or the Indenture Trustee on the
Notes or under the Indenture or any certificate or other writing delivered in
connection therewith, against (i) the Indenture Trustee or the Owner Trustee in
its individual capacity, (ii) any owner of a beneficial interest in the Trust
or (iii) any partner, owner, beneficiary, agent, officer, director or employee
of the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Trust, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall
be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.


          Each
Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note
Owner, a security entitlement with respect to a Note, covenants and agrees by
accepting the benefits of the Indenture that such Noteholder or Note Owner will
not at any time institute against the Depositor or the Trust, or join in any institution
against the Depositor or the Trust of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Notes, the Indenture or the Transaction Documents.






          The
Trust has entered into. the Indenture and this Note is issued with the
intention that, for federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Trust
secured by the Trust Estate. Each Noteholder, by acceptance of a Note (and each
Note Owner by acceptance of a beneficial interest in a Note), agrees to treat
the Notes for federal, state and local income, single business and franchise
tax purposes as indebtedness of the Trust.


          Prior
to the due presentment for registration of transfer of this Note, the Trust,
the Indenture Trustee and any agent of the Trust or the Indenture Trustee may
treat the Person in whose name this Note (as of the day of determination or as
of such other date as may be specified in the Indenture) is registered as the
owner hereof for all purposes, whether or not this Note be overdue, and none of
the Trust, the Indenture Trustee or any such agent shall be affected by notice
to the contrary.


          The
Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Trust and the
rights of the Holders of the Notes under the Indenture at any time by the Trust
with the consent of the Holders of Notes representing a majority of the
Outstanding Amount of all Notes at the time Outstanding The Indenture also
contains provisions permitting the Holders of Notes representing specified percentages
of the Outstanding Amount of the Notes, on behalf of the Holders of all the
Notes, to waive compliance by the Trust with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Note (or any one or more
Predecessor Notes) shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits
the Indenture Trustee to amend or waive certain terms and conditions set forth
in the Indenture without the consent of Holders of the Notes issued thereunder.


          The
term “Trust” as used in this Note includes any successor to the Trust under the
Indenture.


          The
Notes are issuable only in registered form in denominations as provided in the
Indenture, subject to certain limitations therein set forth.


          This
Note and the Indenture shall be construed in accordance with the laws of the
State of New York, without reference to its conflict of law provisions, and the
obligations, rights and remedies of the parties hereunder and thereunder shall
be determined in accordance with such laws.


          No
reference herein to the Indenture and no provision of this Note or of the
Indenture shall alter or impair the obligation of the Trust, which is absolute
and unconditional, to pay the principal of and interest on this Note at the
times, place and rate, and in the coin or currency herein prescribed.


          Anything
herein to the contrary notwithstanding, except as expressly provided in the
Transaction Documents, none of the Trust in its individual capacity, the Owner
Trustee in its individual capacity, any owner of a beneficial interest in the
Trust, or any of their respective






partners,
beneficiaries, agents, officers, directors, employees or successors or assigns
shall be personally liable for, nor shall recourse be had to any of them for,
the payment of principal of or interest on this Note or performance of, or
omission to perform, any of the covenants, obligations or indemnifications
contained in the Indenture. The Holder of this Note by its acceptance hereof
agrees that, except as expressly provided in the Transaction Documents, in the
case of an Event of Default under the Indenture, the Holder shall have no claim
against any of the foregoing for any deficiency, loss or claim therefrom;
provided, however, that nothing contained herein shall be taken to prevent
recourse to, and enforcement against, the assets of the Trust for any and all
liabilities, obligations and undertakings contained in the Indenture or in this
Note.






ASSIGNMENT


Social
Security or taxpayer I.D. or other identifying number of assignee:_______________________


          FOR
VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto:


	
 


	



	
(name and address of assignee)





the within
Note and all rights thereunder, and hereby irrevocably constitutes and appoints
attorney, to transfer said Note on the books kept for registration thereof,
with full power of substitution in the premises.


	
 

	
 

	
 

	
 


	
Dated: _____________________

	
 

	
 

	
 


	
 

	
 

	


	
*/


	
 

	
 

	
Signature
  Guaranteed:

	
 


	
 

	
 

	
 

	
 


	
 

	
 

	


	
*/









*/ NOTICE: The signature to
this assignment must correspond with the name of the registered owner as it
appears on the face of the within Note in every particular, without alteration,
enlargement or any change whatever. Such signature must be guaranteed by an
“eligible guarantor institution” meeting the requirements of the Note
Registrar, which requirements include membership or participation in STAMP or
such other “signature guarantee program” as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended.