ISDA Master Agreement and Schedule



 EXHIBIT 4.15 
 (Multicurrency – Cross Border) 
 ISDA® 
 International Swap Dealers Association, Inc. 
 MASTER AGREEMENT

 dated as of August 23, 2006 
  

					
	 HSBC BANK USA,
 NATIONAL ASSOCIATION
	  	and	  	 CARMEL MOUNTAIN FUNDING
 TRUST


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

 Accordingly, the parties agree as follows: — 
 1. Interpretation 
 (a) Definitions. The terms defined in Section 14 and in the Schedule
will have the meanings therein specified for the purpose of this Master Agreement. 
 (b) Inconsistency. In the event of any inconsistency
between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule),
such Confirmation will prevail for the purpose of the relevant Transaction. 
 (c) Single Agreement. All Transactions are entered into in
reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this “Agreement”), and the parties would not otherwise enter into any Transactions. 

2. Obligations 
 (a) General Conditions.

 (i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions
of this Agreement. 
 (ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account
specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such
delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement. 
 (iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default or Potential Event
of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each other
applicable condition precedent specified in this Agreement. 
 Copyright © 1992 by International Swap Dealers Association, Inc. 
  







 (b) Change of Account. Either party may change its account for receiving a payment or delivery by giving
notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change. 
 (c) Netting. If on any date amounts would otherwise be payable: — 
 (i) in the same currency; and 
 (ii) in respect of the same Transaction, 
 by each party to the other, then, on such date, each party’s obligation to make payment of any such amount will be automatically satisfied and discharged and, if
the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have
been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount. 
 The parties may elect in respect of
two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction.
The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph
(ii) above will not, or will cease to, apply to such Transactions from such date). This election may be made separately for different groups of Transactions and will apply separately to each pairing of Offices through which the parties make and
receive payments or deliveries. 
 (d) Deduction or Withholding for Tax. 
 (i) Gross-Up. All payments under this Agreement will be made without any deduction or withholding for or on account of any Tax unless such
deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect. If a party is so required to deduct or withhold, then that party (“X”) will: —

 (1) promptly notify the other party (“Y”) of such requirement; 
 (2) pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld
from any additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Y; 
 (3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such
authorities; and 
 (4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise entitled under this
Agreement, such additional amount as is necessary to ensure that the net amount actually received by Y (free and clear of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount Y would have received had no such deduction or
withholding been required. However, X will not be required to pay any additional amount to Y to the extent that it would not be required to be paid but for: — 
 (A) the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or 
 (B) the failure of a representation made by Y pursuant to Section 3(f) to be accurate and true unless such failure would not have occurred but for (I) any action taken by a taxing authority, or brought in a
court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (II) a Change in Tax Law. 
  

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 (ii) Liability. If: — 
 (1) X is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding
in respect of which X would not be required to pay an additional amount to Y under Section 2(d)(i)(4); 
 (2) X does not so deduct or
withhold; and 
 (3) a liability resulting from such Tax is assessed directly against X, 
 then, except to the extent Y has satisfied or then satisfies the liability resulting from such Tax, Y will promptly pay to X the amount of such liability
(including any related liability for interest, but including any related liability for penalties only if Y has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)). 
 (e) Default Interest; Other Amounts. Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other
party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate. Such interest will be calculated on the basis of
daily compounding and the actual number of days elapsed. If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be
settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement. 
 3. Representations 
 Each party represents to the other party (which representations will be deemed to be repeated by each party on each date
on which a Transaction is entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement) that: — 
 (a) Basic Representations. 
 (i) Status. It is duly organised and validly existing under
the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing; 
 (ii) Powers.
It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to
deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance; 
 (iii) No Violation or Conflict. Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of
its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets; 
 (iv) Consents. All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit
Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and 
 (v) Obligations Binding. Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors’ rights generally and subject, as to enforceability, to equitable principles of general application (regardless of
whether enforcement is sought in a proceeding in equity or at law)). 
  

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 (b) Absence of Certain Events. No Event of Default or Potential Event of Default or, to its knowledge,
Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a
party. 
 (c) Absence of Litigation. There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit
or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to
which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document. 
 (d) Accuracy of Specified
Information. All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate
and complete in every material respect. 
 (e) Payer Tax Representation. Each representation specified in the Schedule as being made by it for
the purpose of this Section 3(e) is accurate and true. 
 (f) Payee Tax Representations. Each representation specified in the Schedule as
being made by it for the purpose of this Section 3(f) is accurate and true. 
 4. Agreements 
 Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a
party: — 
 (a) Furnish Specified Information. It will deliver to the other party or, in certain cases under subparagraph (iii) below,
to such government or taxing authority as the other party reasonably directs: — 
 (i) any forms, documents or certificates relating to
taxation specified in the Schedule or any Confirmation; 
 (ii) any other documents specified in the Schedule or any Confirmation; and

 (iii) upon reasonable demand by such other party, any form or document that may be required or reasonably requested in writing in order to
allow such other party or its Credit Support Provider to make a payment under this Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax or with such deduction or withholding at a
reduced rate (so long as the completion, execution or submission of such form or document would not materially prejudice the legal or commercial position of the party in receipt of such demand), with any such form or document to be accurate and
completed in a manner reasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification, 
 in
each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable. 
 (b) Maintain
Authorisations. It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document
to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future. 
 (c) Comply with Laws. It
will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which
it is a party. 
 (d) Tax Agreement. It will give notice of any failure of a representation made by it under Section 3(f) to be accurate
and true promptly upon learning of such failure. 
 (e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax levied or
imposed upon it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is incorporated, 

  

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organised, managed and controlled. or considered to have its seat, or in which a branch or office through which it is acting for the purpose of this
Agreement is located (“Stamp Tax Jurisdiction”) and will indemnify the other party against any Stamp Tax levied or imposed upon the other party or in respect of the other party’s execution or performance of this Agreement by any such
Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the other party. 
 5. Events of Default and Termination Events

 (a) Events of Default. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or
any Specified Entity of such party of any of the following events constitutes an event of default (an “Event of Default”) with respect to such party: — 
 (i) Failure to Pay or Deliver. Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied
on or before the third Local Business Day after notice of such failure is given to the party; 
 (ii) Breach of Agreement. Failure by
the party to comply with or perform any agreement or obligation (other than an obligation to make any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination Event or any agreement or obligation
under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party in accordance with this Agreement if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the party;

 (iii) Credit Support Default. 
 (1) Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing
after any applicable grace period has elapsed; 
 (2) the expiration or termination of such Credit Support Document or the failing or ceasing
of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such
Credit Support Document relates without the written consent of the other party; or 
 (3) the party or such Credit Support Provider
disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document; 
 (iv)
Misrepresentation. A representation (other than a representation under Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any
Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated; 
 (v) Default under Specified Transaction. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party (1) defaults under a Specified Transaction and, after giving
effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of, that Specified Transaction, (2) defaults, after giving effect to any applicable notice
requirement or grace period, in making any payment or delivery due on the last payment, delivery or exchange date of, or any payment on early termination of, a Specified Transaction (or such default continues for at least three Local Business Days
if there is no applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate
it or act on its behalf); 
 (vi) Cross Default. If “Cross Default” is specified in the Schedule as applying to the party,
the occurrence or existence of (1) a default, event of default or other similar condition or event (however 

  

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described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements
or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness
becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such
Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any
applicable notice requirement or grace period); 
 (vii) Bankruptcy. The party, any Credit Support Provider of such party or any
applicable Specified Entity of such party:– 
 (1) is dissolved (other than pursuant to a consolidation, amalgamation or merger);
(2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its
creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition
is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order
for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof, (5) has a resolution passed for its
winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee,
custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process
levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (8) causes
or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of,
or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or 
 (viii) Merger Without Assumption. The
party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and, at the time of such consolidation, amalgamation, merger or
transfer: – 
 (1) the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support
Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or 
 (2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or
transferee entity of its obligations under this Agreement. 
 (b) Termination Events. The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in (ii) below
or a Tax Event Upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is
specified pursuant to (v) below:— 
  

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 (i) Illegality. Due to the adoption of, or any change in, any applicable law after the date on
which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date. it becomes unlawful (other
than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):— 
 (1) to perform any
absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or 
 (2) to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support
Provider) has under any Credit Support Document relating to such Transaction; 
 (ii) Tax Event. Due to (x) any action taken by a
taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (y) a Change in
Tax Law, the party (which will be the Affected Party) will, or there is a substantial likelihood that it will, on the next succeeding Scheduled Payment Date (1) be required to pay to the other party an additional amount in respect of an
Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is required to be deducted or withheld for or on account of a Tax (except in
respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is required to be paid in respect of such Tax under Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or (B)); 
 (iii) Tax Event Upon Merger. The party (the “Burdened Party”) on the next succeeding Scheduled Payment Date will either (1) be
required to pay an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been deducted or
withheld for or on account of any Indemnifiable Tax in respect of which the other party is not required to pay an additional amount (other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a party consolidating or
amalgamating with, or merging with or into, or transferring all or substantially all its assets to, another entity (which will be the Affected Party) where such action does not constitute an event described in Section 5(a)(viii); 
 (iv) Credit Event Upon Merger. If “Credit Event Upon Merger” is specified in the Schedule as applying to the party, such party
(“X”), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not
constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be,
immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); of 
 (v)
Additional Termination Event. If any “Additional Termination Event” is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as
specified for such Additional Termination Event in the Schedule or such Confirmation). 
 (c) Event of Default and Illegality. If an event or
circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an Event of Default. 
  

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 6. Early Termination 
 (a) Right to Terminate Following Event of Default. If at any time an Event of Default with respect to a party (the “Defaulting Party”) has occurred and is then continuing, the other party (the
“Non-defaulting Party”) may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in
respect of all outstanding Transactions. If, however, “Automatic Early Termination” is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon
the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding
or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8). 
 (b) Right to Terminate Following Termination Event. 
 (i) Notice. If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such
other information about that Termination Event as the other party may reasonably require. 
 (ii) Transfer to Avoid Termination Event.
If either an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected Party, the Affected Party will, as a condition to its right
to designate an Early Termination Date under Section 6(b)(iv), use all reasonable efforts (which will not require such party to incur a loss, excluding immaterial, incidental expenses) to transfer within 20 days after it gives notice under
Section 6(b)(i) all its rights and obligations under this Agreement in respect of the Affected Transactions to another of its Offices or Affiliates so that such Termination Event ceases to exist. 
 If the Affected Party is not able to make such a transfer it will give notice to the other party to that effect within such 20 day period, whereupon the
other party may effect such a transfer within 30 days after the notice is given under Section 6(b)(i). 
 Any such transfer by a party
under this Section 6(b)(ii) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party’s policies in effect at such time would permit it to enter into
transactions with the transferee on the terms proposed. 
 (iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1)
or a Tax Event occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event. 
 (iv) Right to Terminate. If:— 
 (1) a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case may be, has not been effected with respect to all Affected Transactions within 30 days after an Affected Party gives notice under
Section 6(b)(i); or 
 (2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event
occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party, 
 either party in the case of an Illegality, the
Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit
Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then continuing, designate a day not earlier than
the day such notice is effective as an Early Termination Date in respect of all Affected Transactions. 
  

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 (c) Effect of Designation. 
 (i) If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so
designated, whether or not the relevant Event of Default or Termination Event is then continuing. 
 (ii) Upon the occurrence or effective
designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement.
The amount, if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e). 
 (d)
Calculations. 
 (i) Statement. On or as soon as reasonably practicable following the occurrence of an
Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant
quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid. In the absence of written confirmation from the source of a quotation obtained
in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation. 
 (ii) Payment Date. An amount calculated as being due in respect of any Early Termination Date under Section 6(e) will be payable on the day that notice of the amount payable is effective (in the case of an
Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which
is designated as a result of a Termination Event). Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment) in the Termination Currency, from (and including) the
relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. 
 (e) Payments on Early Termination. If an Early Termination Date occurs, the following provisions shall apply based on the parties’ election in the
Schedule of a payment measure, either “Market Quotation” or “Loss”, and a payment method, either the “First Method” or the “Second Method”. If the parties fail to designate a payment measure or payment method
in the Schedule, it will be deemed that “Market Quotation” or the “Second Method”, as the case may be, shall apply. The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will
be subject to any Set-off. 
 (i) Events of Default. If the Early Termination Date results from an Event of Default:— 

(1) First Method and Market Quotation. If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non-defaulting Party
the excess, if a positive number, of (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. 
 (2) First
Method and Loss. If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party’s Loss in respect of this Agreement. 
 (3) Second Method and Market Quotation. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the
Settlement Amount (determined by the 

  

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Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting
Party less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting
Party will pay the absolute value of that amount to the Defaulting Party. 
 (4) Second Method and Loss. If the Second Method and Loss
apply, an amount will be payable equal to the Non-defaulting Party’s Loss in respect of this Agreement. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the
Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party. 
 (ii) Termination Events. If the Early
Termination Date results from a Termination Event:— 
 (1) One Affected Party. If there is one Affected Party, the amount payable
will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed
to be references to the Affected Party and the party which is not the Affected Party, respectively, and, if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions.

 (2) Two Affected Parties. If there are two Affected Parties:— 
 (A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable
equal to (I) the sum of (a) one-half of the difference between the Settlement Amount of the party with the higher Settlement Amount (“X”) and the Settlement Amount of the party with the lower Settlement Amount (“Y”) and
(b) the Termination Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing to Y; and 
 (B) if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be
payable equal to one-half of the difference between the Loss of the party with the higher Loss (“X”) and the Loss of the party with the lower Loss (“Y”). 
 If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y. 

(iii) Adjustment for Bankruptcy. In circumstances where an Early Termination Date occurs because “Automatic Early Termination” applies
in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and
retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii). 
 (iv) Pre-Estimate. The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such amount is payable for the
loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses. 
  

 10 








 7. Transfer 
 Subject
to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, except
that:— 
 (a) a party may make such a transfer of this Agreement pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of
all or substantially all its assets to, another entity (but without prejudice to any other right or remedy under this Agreement); and 
 (b) a party may make
such a transfer of all or any part of its interest in any amount payable to it from a Defaulting Party under Section 6(e). 
 Any purported transfer that is not in compliance with this Section will be void. 
 8. Contractual Currency 
 (a) Payment in the Contractual Currency. Each payment under this Agreement will be made in the relevant currency specified in this Agreement for that
payment (the “Contractual Currency”). To the extent permitted by applicable law, any obligation to make payments under this Agreement in the Contractual Currency will not be discharged or satisfied by any tender in any currency other than
the Contractual Currency, except to the extent such tender results in the actual receipt by the party to which payment is owed, acting in a reasonable manner and in good faith in converting the currency so tendered into the Contractual Currency, of
the full amount in the Contractual Currency of all amounts payable in respect of this Agreement. If for any reason the amount in the Contractual Currency so received falls short of the amount in the Contractual Currency payable in respect of this
Agreement, the party required to make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the Contractual Currency as may be necessary to compensate for the shortfall. If for any reason the amount
in the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this Agreement, the party receiving the payment will refund promptly the amount of such excess. 
 (b) Judgments. To the extent permitted by applicable law, if any judgment or order expressed in a currency other than the Contractual
Currency is rendered (i) for the payment of any amount owing in respect of this Agreement, (ii) for the payment of any amount relating to any early termination in respect of this Agreement or (iii) in respect of a judgment or order of
another court for the payment of any amount described in (i) or (ii) above, the party seeking recovery, after recovery in full of the aggregate amount to which such party is entitled pursuant to the judgment or order, will be entitled to
receive immediately from the other party the amount of any shortfall of the Contractual Currency received by such party as a consequence of sums paid in such other currency and will refund promptly to the other party any excess of the Contractual
Currency received by such party as a consequence of sums paid in such other currency if such shortfall or such excess arises or results from any variation between the rate of exchange at which the Contractual Currency is converted into the currency
of the judgment or order for the purposes of such judgment or order and the rate of exchange at which such party is able, acting in a reasonable manner and in good faith in converting the currency received into the Contractual Currency, to purchase
the Contractual Currency with the amount of the currency of the judgment or order actually received by such party. The term “rate of exchange” includes, without limitation, any premiums and costs of exchange payable in connection with the
purchase of or conversion into the Contractual Currency. 
 (c) Separate Indemnities. To the extent permitted by applicable law, these
indemnities constitute separate and independent obligations from the other obligations in this Agreement, will be enforceable as separate and independent causes of action, will apply notwithstanding any indulgence granted by the party to which any
payment is owed and will not be affected by judgment being obtained or claim or proof being made for any other sums payable in respect of this Agreement. 
 (d) Evidence of Loss. For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made. 
  

 11 








 9. Miscellaneous 
 (a)
Entire Agreement. This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect thereto. 
 (b) Amendments. No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a
facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system. 
 (c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction. 
 (d) Remedies Cumulative. Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and
not exclusive of any rights, powers, remedies and privileges provided by law. 
 (e) Counterparts and Confirmations. 
 (i) This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile
transmission), each of which will be deemed an original. 
 (ii) The parties intend that they are legally bound by the terms of each
Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by
an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement. The parties will specify therein or through
another effective means that any such counterpart, telex or electronic message constitutes a Confirmation. 
 (f) No Waiver of Rights. A
failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent
or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege. 
 (g) Headings. The headings
used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement. 
 10. Offices; Multibranch Parties 
 (a) If Section 10(a) is specified in the Schedule as applying, each party that
enters into a Transaction through an Office other than its head or home office represents to the other party that, notwithstanding the place of booking office or jurisdiction of incorporation or organisation of such party, the obligations of such
party are the same as if it had entered into the Transaction through its head or home office. This representation will be deemed to be repeated by such party on each date on which a Transaction is entered into. 
 (b) Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of
the other party. 
 (c) If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receive payments or deliveries
under any Transaction through any Office listed in the Schedule, and the Office through which it makes and receives payments or deliveries with respect to a Transaction will be specified in the relevant Confirmation. 
 11. Expenses 
 A Defaulting Party will, on demand, indemnify and hold
harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support
Document to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection. 
  

 12 








 12. Notices 
 (a)
Effectiveness. Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission
or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:— 
 (i) if in writing and delivered in person or by courier, on the date it is delivered; 
 (ii) if sent by telex, on the date the recipient’s answerback is received; 
 (iii) if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being
agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender’s facsimile machine); 
 (iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or 
 (v) if sent by electronic messaging system, on the date that electronic message is received, 
 unless the date of that delivery (or attempted delivery) or that receipt as applicable, is not a Local Business Day or that communication is delivered (or attempted) or
received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day. 
 (b) Change of Addresses. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system
details at which notices or other communications are to be given to all 
 13. Governing Law and Jurisdiction 
 (a) Governing Law. This Agreement will be governed by and construed in accordance with the law specified in the Schedule. 
 (b) Jurisdiction. With respect to any suit, action or proceedings relating to this Agreement (“Proceedings”), each party irrevocably:—

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

 (ii) waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any
claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party. 
 Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English
law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more
jurisdictions preclude the bringing of Proceedings in any other jurisdiction. 
 (c) Service of Process. Each party irrevocably appoints the
Process Agent (if any) specified opposite its name in the Schedule to receive, for it and on its behalf, service of process in any Proceedings. If for any 

  

 13 








 
reason any party’s Process Agent is unable to act as such, such party will promptly notify the other party and within 30 days appoint a substitute
process agent acceptable to the other party. The parties irrevocably consent to service of process given in the manner provided for notices in Section 12. Nothing in this Agreement will affect the right of either party to serve process in any
other manner permitted by law. 
 (d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent permitted by applicable law,
with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of
injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise
be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings. 
 14. Definitions 
 As used in this
Agreement: — 
 “Additional Termination Event” has the meaning specified in Section 5(b). 
 “Affected Party” has the meaning specified in Section 5(b). 
 “Affected Transactions” means (a) with respect to any Termination Event consisting of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the occurrence of such Termination Event and
(b) with respect to any other Termination Event, all Transactions. 
 “Affiliate” means, subject to the Schedule, in relation to any
person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, “control” of
any entity or person means ownership of a majority of the voting power of the entity or person. 
 “Applicable
Rate” means: — 
 (a) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting
Party, the Default Rate; 
 (b) in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in
accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate; 
 (c) in respect of all other obligations payable or deliverable
(or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and 
 (d) in all other cases, the Termination
Rate. 
 “Burdened Party” has the meaning specified in Section 5(b). 
 “Change in Tax Law” means the enactment, promulgation, execution or ratification of, or any change in or amendment to, any law (or in the application or official interpretation of any law) that occurs
on or after the date on which the relevant Transaction is entered into. 
 “consent” includes a consent, approval, action, authorisation,
exemption, notice, filing, registration or exchange control consent. 
 “Credit Event Upon Merger” has the meaning specified in
Section 5(b). 
 “Credit Support Document” means any agreement or instrument that is specified as such in this Agreement. 

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

 14 








 “Defaulting Party” has the meaning specified in Section 6(a). 
 “Early Termination Date” means the date determined in accordance with Section 6(a) or 6(b)(iv). 
 “Event of Default” has the meaning specified in Section 5(a) and, if applicable, in the Schedule. 
 “Illegality” has the meaning specified in Section 5(b). 
 “Indemnifiable Tax” means any Tax other than a Tax that would not be imposed in respect of a payment under this Agreement but for a present or former connection between the jurisdiction of the government or taxation
authority imposing such Tax and the recipient of such payment or a person related to such recipient (including, without limitation, a connection arising from such recipient or related person being or having been a citizen or resident of such
jurisdiction, or being or having been organised, present or engaged in a trade or business in such jurisdiction, or having or having had a permanent establishment or fixed place of business in such jurisdiction, but excluding a connection arising
solely from such recipient or related person having executed, delivered, performed its obligations or received a payment under, or enforced, this Agreement or a Credit Support Document). 
 “law” includes any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority) and “lawful” and
“unlawful” will be construed accordingly. 
 “Local Business Day” means, subject to the Schedule, a day on which commercial banks
are open for business (including dealings in foreign exchange and foreign currency deposits) (a) in relation to any obligation under Section 2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so specified, as
otherwise agreed by the parties in writing or determined pursuant to provisions contained, or incorporated by reference, in this Agreement, (b) in relation to any other payment, in the place where the relevant account is located and, if
different. in the principal financial centre, if any, of the currency of such payment, (c) in relation to any notice or other communication, including notice contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by Section 2(b), in the place where the relevant new account is to be located and (d) in relation to Section 5(a)(v)(2), in the relevant locations for
performance with respect to such Specified Transaction. 
 “Loss” means, with respect to this Agreement or one or more Terminated
Transactions, as the case may be, and a party, the Termination Currency Equivalent of an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection
with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result
of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position (or any gain resulting from any of them). Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made
(assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(c)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include
a party’s legal fees and out-of-pocket expenses referred to under Section 11. A party will determine its Loss as of the relevant Early Termination Date, or, if that is not reasonably practicable, as of the earliest date thereafter as is
reasonably practicable. A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets. 
 “Market Quotation” means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers. Each
quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit
Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the “Replacement Transaction”) that would have the effect of preserving for such party the economic
equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated
Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have 

  

 15 








 
been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated Transactions are to be
excluded but, without limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required (assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included.
The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference Market-maker to provide its
quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date. The day and time as of which those quotations are
to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(e), and, if each party is so obliged, after consultation with the other. If more than three quotations are provided, the Market Quotation will
be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values, If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and
lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, it will be deemed that the Market Quotation in
respect of such Terminated Transaction or group of Terminated Transactions cannot be determined. 
 “Non-default Rate” means a rate per
annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount. 
 “Non-defaulting Party” has the meaning specified in Section 6(a). 
 “Office” means a branch or office of a
party, which may be such party’s head or home office. 
 “Potential Event of Default” means any event which, with the giving of notice
or the lapse of time or both, would constitute an Event of Default. 
 “Reference Market-makers” means four leading dealers in the relevant
market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make
an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city. 
 “Relevant
Jurisdiction” means, with respect to a party, the jurisdictions (a) in which the party is incorporated, organised, managed and controlled or considered to have its seat, (b) where an Office through which the party is acting for
purposes of this Agreement is located, (c) in which the party executes this Agreement and (d) in relation to any payment, from or through which such payment is made. 
 “Scheduled Payment Date” means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction. 
 “Set-off” means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an
amount under Section 6 is entitled or subject (whether arising under this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer. 
 “Settlement Amount” means, with respect to a party and any Early Termination Date, the sum of.- 
 (a) the
Termination Currency Equivalent of the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and 
 (b) such party’s Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions
for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result. 
 “Specified Entity” has the meaning specified in the Schedule. 
  

 16 








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

 “Tax” means any present or future tax, levy, impost, duty, charge, assessment or fee of any nature (including interest, penalties and
additions thereto) that is imposed by any government or other taxing authority in respect of any payment under this Agreement other than a stamp, registration, documentation or similar tax. 
 “Tax Event” has the meaning specified in Section 5(b). 
 “Tax Event Upon Merger” has the meaning specified in Section 5(b). 
 “Terminated Transactions” means with
respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of
the notice designating that Early Termination Date (or, if “Automatic Early Termination” applies, immediately before that Early Termination Date). 
 “Termination Currency” has the meaning specified in the Schedule. 
 “Termination Currency Equivalent” means, in
respect of any amount denominated in the Termination Currency, such Termination Currency amount and, in respect of any amount denominated in a currency other than the Termination Currency (the “Other Currency”), the amount in the
Termination Currency determined by the party making the relevant determination as being required to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Market Quotation or Loss (as the case may
be), is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spot exchange rate of the foreign exchange agent (selected as provided below) for the purchase of such Other Currency with the Termination
Currency at or about 11:00 a.m. (in the city in which such foreign exchange agent is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency for value on the relevant Early Termination
Date or that later date. The foreign exchange agent will, if only one party is obliged to make a determination under Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties 
 “Termination Event” means an Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a Credit Event Upon Merger or an
Additional Termination Event. 
 “Termination Rate” means a rate per annum equal to the arithmetic mean of the cost (without proof or
evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts. 
 “Unpaid Amounts”
owing to any party means, with respect to an Early Termination Date, the aggregate of (a) in respect of all Terminated Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii)) to such
party under Section 2(a)(i) on or prior to such Early Termination Date and which remain unpaid as at such Early Termination Date and (b) in respect of each Terminated Transaction. for each obligation under Section 2(a)(i) which was
(or would have been but for Section 2(a)(iii)) required to be settled by delivery to such party on or prior to such Early Termination Date and which has not been so settled as at such Early Termination Date, an amount equal to the fair market


  

 17 








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

											
	HSBC BANK USA, NATIONAL ASSOCIATION	 		 		 	CARMEL MOUNTAIN FUNDING TRUST
						
	By:	 	 /s/ SANDRA NICOTRA
	 		 		 	By:	 	U.S. Bank Trust National Association, not in its individual capacity, but solely as Owner Trustee
	Name:	 	Sandra Nicotra	 		 		 		 
	Title:	 	Vice President	 		 		 		 	
	Date:	 		 		 		 		 	
						
		 		 		 		 	By:	 	 /s/ PATRICIA M. CHILD

		 		 		 		 	Name:	 	Patricia M. Child
		 		 		 		 	Title:	 	Vice President
		 		 		 		 	Date:	 	

  

 18 








 SCHEDULE 
 to the Master Agreement 
 (Multicurrency - Cross Border) 
 dated as of August 23, 2006 
 between

 HSBC BANK USA, NATIONAL ASSOCIATION 
 (“Party A”), 
 a national banking association created or organized 
 under the laws of the United States of America 
 and 
 CARMEL MOUNTAIN FUNDING TRUST 
 (“Party B”), 
 a Delaware statutory trust 
 Part 1 TERMINATION PROVISIONS 
 In
this Agreement: 
  

	(a)	“Specified Entity” means in relation to Party A for the purpose of: 

  

			
	 Section 5(a)(v)
	  	 Not Applicable.

	 Section 5(a)(vi)
	  	 Not Applicable.

	 Section 5(a)(vii)
	  	 Not Applicable.

	 Section 5(b)(iv)
	  	 Not Applicable.


 and in relation to Party B for the purpose of: 
  

			
	 Section 5(a)(v)
	  	 Not Applicable.

	 Section 5(a)(vi)
	  	 Not Applicable.

	 Section 5(a)(vii)
	  	 Not Applicable.

	 Section 5(b)(iv)
	  	 Not Applicable.


  

	(b)	“Specified Transaction” will have the meaning specified in Section 14 of this Agreement. 

  

	(c)	The provisions of Section 5(a) and Section 5(b) (as modified by (g) below) will apply to Party A and to Party B as follows: 

 The designation below of an Event of Default as being “Applicable” to a specific party means that upon the occurrence of such an Event of Default with respect
to such party, the other party shall have the rights of a Non-defaulting Party under Section 6 of the Agreement, and conversely, the designation of such an event as being “Not Applicable” means that such other party shall not
have such right. 
  

 19 









					
	 Section 5(a)
	  	Party A	  	Party B
	(i) “Failure to Pay or Deliver”	  	Applicable.	  	Applicable.
	(ii) “Breach of Agreement”	  	Not Applicable.	  	Not Applicable.
	(iii) “Credit Support Default”	  	Applicable.	  	Not Applicable.
	(iv) “Misrepresentation”	  	Not Applicable.	  	Not Applicable.
	(v) “Default under Specified Transaction”	  	Not Applicable.	  	Not Applicable.
	(vi) “Cross Default”	  	Not Applicable.	  	Not Applicable.
	(vii) “Bankruptcy”	  	Applicable.	  	Applicable.
	(viii) “Merger Without Assumption”	  	Applicable.	  	Applicable.

 provided that Section (5)(a)(i) of this Agreement is amended to read as follows: 
 Failure to Pay or Deliver. Failure by the party to make, on the date when due, any payment under this Agreement or delivery under
Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party (and the Collateral Agent, if Party B is the party that
has failed to make the payment under this Agreement); provided, however, that if the due date for such payment is a Payment Date, the Final Maturity for any Extended Note, Term Note or Subordinated Note or any other day that interest
is due and payable on any Extended Note, Term Note or Subordinated Note, failure by Party A to make, on the date when due, any payment under this Agreement shall be an Event of Default, without giving effect to any grace period unless Party A used
its best efforts to make such payment on the date when due, and the failure of Party B to receive such payment was the result of a force majeure; provided, further, that any payment default by Party B may be cured prior to designation
of an Early Termination Date on behalf of Party B by the Collateral Agent (but the Collateral Agent shall have no obligation to do so). Capitalized terms used in this paragraph shall have the meanings ascribed to such terms in Schedule I to the
Security Agreement. For purposes of this Section 5(a)(i), “force majeure” shall mean any act of god, strikes, lockout, labor troubles, riots, insurrection, terrorist attack or other causes beyond Party A’s control.

 The designation below of a Termination Event as being “Applicable” to a specific party means that upon the occurrence of such a Termination
Event with respect to such party, either party in 

  

 20 








 
the case of an Illegality, the party which is not the Affected Party in the case of an Additional Termination Event if there is only one Affected Party, as
the case may be, shall have the right to terminate the Transaction in accordance with Section 6(b) of the Agreement, and conversely, the designation of such an event as being “Not Applicable” means that neither party shall have
the right to terminate the Transaction in accordance with Section 6(b) of the Agreement upon the occurrence of such Termination Event with respect to such party. 
  

					
	 Section 5(b)
	  	Party A	  	Party B
	(i) “Illegality”	  	Applicable.	  	Applicable.
	(ii) “Tax Event”	  	Not Applicable.	  	Not Applicable.
	(iii) “Tax Event Upon Merger”	  	Not Applicable.	  	Not Applicable.
	(iv) “Credit Event Upon Merger”	  	Not Applicable.	  	Not Applicable.
	(v) “Additional Termination Event”	  	Applicable.	  	Applicable.

  

	(d)	Payments on Early Termination. For the purpose of Section 6(e) the following applies in connection with an Early Termination of this Agreement:


  

	 	(i)	Market Quotation will apply. 

  

	 	(ii)	The Second Method will apply. 

  

	(e)	“Termination Currency” means United States Dollars (“USD”). 

  

	(f)	The “Automatic Early Termination” provisions of Section 6(a) will not apply to Party A or Party B. 

  

	(g)	Each of the following shall constitute an “Additional Termination Event” pursuant to Section 5(b)(v): 

  

	 	(i)	Party A Downgrade. The occurrence and continuation (following the expiration of all applicable notice, grace and/or cure periods) of a Termination Event pursuant to Part
5(o) herein, in which case, the Early Termination Date shall be the date, if any, designated by Party B. Party A shall be the sole Affected Party with respect to such Additional Termination Event and Party B shall be the sole party entitled to
designate the occurrence of an Early Termination Date with respect to the occurrence of such Additional Termination Event. 

  

	 	(ii)	Amendments Made Without Consent of Party A. It shall be an Additional Termination Event if (x) any amendment and/or supplement to the Indenture, the Security Agreement
or any other Program Document is made without the prior written consent of Party A, and (y) Party A’s consent is required under the Program Documents for such amendment and/or supplement. In connection with such Additional Termination
Event, Party B shall be the sole Affected Party. 

  

	 	(iii)	 Partial Termination Event. It shall be an Additional Termination Event if a Partial Termination Event occurs pursuant to Section 11.2 of the
Mortgage Loan 



  

 21 








 
Purchase and Servicing Agreement and Party A is a Departing Swap Counterparty. Unless such Partial Termination Event shall have been subsequently waived by
Party A pursuant to Section 11.2 of the Mortgage Loan Purchase and Servicing Agreement, the Early Termination Date with respect to this Additional Termination Event shall be deemed to occur automatically on the date on which the Partial
Termination Condition has been satisfied, if such date occurs on or prior to the date which is ninety (90) days after the occurrence of the related Partial Termination Event. For purposes of the foregoing Additional Termination Event, Party B
shall be the sole Affected Party. 
 Part 2. TAX REPRESENTATIONS. 
  

	(a)	Payer Tax Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B will each make the following representation:


 It is not required by any applicable law, as modified by the practice of any relevant governmental revenue authority, of any
Relevant Jurisdiction to make any deduction or withholding for or on account of any Tax from any payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it to the other party under
this Agreement. In making this representation, it may rely on (i) the accuracy of any representations made by the other party pursuant to Section 3(f) of this Agreement, (ii) the satisfaction of the agreement of the other party
contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and effectiveness of any document provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and
(iii) the satisfaction of the agreement of the other party contained in Section 4(d) of this Agreement; provided that it shall not be a breach of this representation where reliance is placed on clause (ii) and the other
party does not deliver a form or document under Section 4(a)(iii) by reason of material prejudice to its legal or commercial position. 
  

	(b)	Payee Tax Representations. For the purpose of Section 3(f) of this Agreement, Party A and Party B will make the following representations specified below, if any:


  

	 	(i)	Party A is a national banking association created or organized under the laws of the United States of America and the federal taxpayer identification number is 20-1177241.


  

	 	(ii)	The following representation will apply to Party B: 

 It is
a “U.S. person” within the meaning of United States Treasury Regulation section 1.1441-4(a)(3)(ii) for United States federal income tax purposes. 
  

 22 








 Part 3 Agreement to Deliver Documents. 
 Section 4(a) of this Agreement is amended by deleting the following in the first sentence thereof, in certain cases under subparagraph (iii) below, 
 Section 4(a)(iii) of this Agreement is amended to read as follows: 
 any forms, documents or certificates that may be required or reasonably requested in order to allow such other party to make a payment under this
Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax, or with such deduction or withholding at a reduced rate, with any such forms, documents or certificates to be accurate and
completed in a manner reasonably satisfactory to such other party, and to be executed and to be delivered with any required certification to such other party (or to such government or taxing authority as such other party reasonably directs),
promptly upon the earlier of (A) reasonable demand by such other party and (B) learning that any such forms, documents or certificates are required; 
 For the purpose of Section 4(a)(i) and Section 4(a)(ii) of this Agreement, Party A and Party B each agree to deliver the following documents, as applicable: 
 Documents to be delivered are: 
  

							
	 Party required to
deliver document
	  	 Form, Document or
 Certificate
	  	 Date by which to
 be Delivered
	  	Covered by
Section 3(d)
				
	Party A	  	An opinion of counsel to Party A(which may include in-house counsel) acceptable to counsel of Party B.	  	Upon execution of this Agreement.	  	No
				
	Party A	  	An incumbency certificate with respect to the signatory of this Agreement.	  	Upon execution of this Agreement.	  	Yes
				
	Party B	  	An opinion of counsel to Party B acceptable to counsel of Party A.	  	Upon execution of this Agreement.	  	No
				
	Party B	  	An incumbency certificate with respect to the signatory of this Agreement.	  	Upon execution of this Agreement.	  	Yes
				
	Party B	  	Executed copies of each Program Document and each amendment thereof.	  	Upon execution of this Agreement and on the date of each amendment thereof.	  	Yes

  

 23 









							
	 Party required to
deliver document
	  	 Form, Document or
 Certificate
	  	 Date by which to
 be Delivered
	  	 Covered by
Section 3(d)

				
	Party B	  	Copy of each notice and/or report received or delivered by the Issuer pursuant to the Program Documents.	  	Within five (5) Local Business Days of the Issuer’s receipt or delivery of any such notice or report.	  	Yes
				
	Party A and Party B	  	An executed U.S. Internal Revenue Service Form W-9, W-8BEN or W-8ECI, as applicable (or any successor thereto).	  	(i) Upon execution and delivery of this Agreement, (ii) Before the first Payment Date under this Agreement, (iii) promptly upon reasonable demand by Party A or Party B, as applicable, and (iv)
promptly upon learning that any such form previously provided by such Party has become obsolete or incorrect.	  	N/A
				
	Party A	  	Certified copies of all corporate or partnership authorizations, as the case may be, and any other documents with respect to the execution, delivery and performance of this Agreement and the
related Confirmation	  	Upon execution of this Agreement	  	Yes
				
	Party B	  	Certified copies of all corporate or partnership authorizations, as the case may be, and any other documents with respect to the execution, delivery and performance of this Agreement and the
related Confirmation	  	Upon execution of this Agreement	  	Yes

  

 24 








 Part 4 Miscellaneous. 
 (a) Addresses for Notices. For the purpose of Section 12(a): 
 Address for notices or
communications to Party A: 
  

			
	Address:	  	HSBC Bank USA, National Association
		  	452 Fifth Avenue
		  	New York, NY 10018
		  	Attention: Legal Department
		  	Fax: 212-525-6509
	
	Address for notices or communications to Party B:
		
	Address:	  	Carmel Mountain Funding Trust
		  	c/o Accredited Home Lenders, Inc.
		  	15090 Avenue of Science
		  	San Diego, California 92128
		
		  	Attention: Katy Hudson
		  	Telephone: 858-676-2177
		  	858-676-2177
		  	858-676-2177
		  	Facsimile No: 866-278-5876
	
	Address for notices or communications to Moody’s:
		
	Address:	  	Moody’s Investors Service, Inc.
		  	99 Church Street
		  	New York, New York 10007
		  	Attention: Asset Backed Commercial Paper Group
		  	Facsimile No: (212) 553-0300
	
	Address for notices or communications to S&P:
		
	Address:	  	Standard & Poor’s Ratings Services,
		  	a division of The McGraw-Hill Companies, Inc.
		  	55 Water Street
		  	New York, New York 10041
		  	Attention: Asset Backed Surveillance Group
		  	Facsimile No: (212) 438-2647

 Notices under this Agreement and the Transaction shall be sent to Moody’s and S&P only to the extent
specifically required in the Transaction Confirmation. 
 (b) Process Agent. For the purpose of Section 13(c): 
 Party A appoints as its Process Agent: Not Applicable. 
 Party B appoints as its Process Agent: Not Applicable. 
  

 25 









	(c)	Offices. The provisions of Section 10(a) will apply to Party A and will not apply to Party B. 

  

	(d)	Multibranch Party. For the purpose of Section 10(c) of this Agreement: 

 Party A is a Multibranch Party and may act through its Charlotte, North Carolina, Chicago, Illinois, San Francisco, California, New York, New York, Boston, Massachusetts or London, England Office, or such other Office
as may be agreed to by the parties in connection with a Transaction. 
 Party B is not a Multibranch Party. 
  

	(e)	Calculation Agent. The Calculation Agent shall be the Servicer. All calculations made by the Calculation Agent shall be binding absent manifest error. Party A acting in good
faith may dispute any calculation of the Calculation Agent and the parties shall use reasonable efforts to resolve any disputes concerning such calculations. 

  

	(f)	Credit Support Document. Details of any Credit Support Document: 

  

			
	In the case of Party A:	  	Initially none; if required pursuant to Part 5(o) of this Schedule, a 1994 ISDA Credit Support Annex (New York law), including paragraph 13 thereto, if any, delivered pursuant to Part
5(o)(iii), or a guaranty, if any, delivered pursuant to Part 5(o)(iv).
		
	In the case of Party B:	  	The Security Agreement and the Indenture.

 Notwithstanding the foregoing, each party hereto acknowledges and agrees that “Credit Support
Default” (Section 5(a)(iii) of the Agreement) shall not constitute an Event of Default applicable to Party B. 
  

	(g)	Credit Support Provider. 

 Credit Support Provider
means in relation to Party A: Not Applicable. 
 Credit Support Provider means in relation to Party B: Not Applicable. 
  

	(h)	“Affiliate” will have the meaning specified in Section 14 of this Agreement. 

  

	(i)	GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO CONFLICTS OF LAWS PROVISIONS
THEREOF, OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW). 

  

 26 









	(j)	Netting of Payments. Section 2(c)(ii) will apply with respect to all payments under this Agreement. 

  

	(k)	Account Detail: 

 Payments to Party A: The Account described in the
related Confirmation. Payments to Party B: 
 The Collateral Account under the Security Agreement. 
 Part 5 OTHER PROVISIONS. 
  

	(a)	Confirmation. Party A and Party B each agrees and acknowledges that the only Transaction that is or will be governed by this Agreement is the Transaction evidenced by the one
Confirmation dated on the date hereof (it being understood that, in the event such Confirmation shall be amended (in any respect), such amendment shall not constitute (for purposes of this paragraph) a separate Transaction or a separate
Confirmation). 

  

	(b)	Amendments to Section 6 of this Agreement. 

  

	 	(i)	Section 6(b)(ii) is hereby amended by adding at the end of the first paragraph the following: 

 “, provided that the party seeking to make the transfer to avoid a Termination Event shall obtain and deliver to Party B (in the case of
transfers by Party A) or to Party A (in the case of transfers by Party B) evidence of Rating Agency Confirmation.” 
  

	 	(ii)	Section 6(d)(i) is hereby amended and restated in its entirety as follows: 

 “(i) Statement. On or as soon as reasonably practicable following the occurrence of an Early Termination Date in which Party B is the sole non-Defaulting Party or sole non-Affected Party, the Calculation
Agent shall make computations of the amounts, if any, owing pursuant to Section 6(e) (as modified by the terms of this Schedule) and will provide each party a statement showing in reasonable detail such calculations and specifying the
amount payable by each party pursuant to Section 6(e). Party A shall have the right to request a certified statement showing in reasonable detail such calculations, specifying the source of such calculations and providing copies of all
material documents and information relied upon by the Calculation Agent in performing its obligations hereunder. Party A acting in good faith may dispute any calculations of the Calculation Agent and the parties shall use reasonable efforts to
resolve any disputes concerning such computations or calculations.” 
  

	(c)	Transfer. Section 7 is hereby amended by: 

  

	 	(i)	adding the words “(and notice of the transferee to)” after the word “of’ in the third line thereof, and (ii) adding the words “(subject to providing
three Business Days prior written notice of the transferee to the other party and to each Rating Agency)” after the word “transfer” in the fourth and seventh line thereof. 

  

 27 









	 	(ii)	adding at the end thereof: 

 “Any party making any
such transfer shall deliver evidence of Rating Agency Confirmation to the other party. Notwithstanding the foregoing, nothing in this section shall be deemed to prohibit any party from making a transfer as expressly permitted herein.”

  

	 	(iii)	adding a new paragraph 7(c) reading as follows: 

 “(c) Notwithstanding anything to the contrary set forth in the Agreement, Party A agrees to the assignment to Deutsche Bank Trust Company Americas, as Collateral Agent (the “Collateral Agent”) under the Security
Agreement between Party B and the Collateral Agent for the benefit of the Secured Parties under the Security Agreement of, and the grant to the Collateral Agent for the benefit of each Secured Party of a security interest in, the rights of Party B
under this Agreement and the Confirmation. Party A further consents to and agrees that in connection with the realization of any of the Secured Parties’ rights (including Party A’s rights) under the Security Agreement, that the Collateral
Agent, on behalf of the Secured Parties (including Party A) is entitled to, and shall have, all rights of Party B hereunder.” 
  

	(d)	Amendments to Section 9(b) of this Agreement. Section 9(b) of this Agreement is hereby amended by adding the following after the word “system” in
the last line thereof: 

 “, provided, however, that each Rating Agency shall receive prior written notice of
all such amendments, modifications or waivers; provided, further, that each material amendment, modification or waiver shall require, prior to its effectiveness, that Rating Agency Confirmation has been obtained in connection with such
material amendment, modification or waiver.” 
  

	(e)	Swap Exemption. 

  

	 	(i)	The parties agree that this Agreement and the Transaction are intended to constitute a “swap agreement” within the meaning of Commodity Futures Trading Commission
(“CFTC”) Regulations Section 35.1(b)(1) and Section 101(53B) of the U.S. Bankruptcy Code; 

  

	 	(ii)	Each party represents to the other that on the date hereof (a) it is an “eligible contract participant” within the meaning of Section la(12) of the Commodity Exchange
Act, as amended; (b) this Agreement is subject to individual negotiation by each party; and (c) this Agreement will not be executed or traded on a “trading facility” within the meaning of Section la(33) of the Commodity Exchange
Act, as amended. 

  

	 	(iii)	The parties agree that neither this Agreement nor the Transaction is one of a fungible class of agreements that are standardized as to their material economic terms, within the
meaning of CFTC Regulations Section 35.2(b); and 

  

	 	(iv)	Each party represents to the other that the creditworthiness of the other party was or will be a material consideration in entering into or determining the terms of this Agreement
and the Transaction, including pricing, cost or credit enhancement terms of the Agreement or the Transaction, within the meaning of CFTC Regulations Section 35.2(c). 

  

 28 









	(f)	WAIVER OF RIGHT TO TRIAL BY JURY. EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO A TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY TRANSACTION. 

  

	(g)	Section 2. Section 2(e) of the Agreement shall not apply to payments to be made by Party B. 

  

	(h)	Notice of Events of Default. Each party agrees, upon learning of the occurrence of any event or commencement of any condition that constitutes (or that with the giving of
notice or passage of time or both would constitute) an Event of Default or Termination Event with respect to such party, promptly to give the other party notice of such event or condition (or, in lieu of giving notice of such event or condition in
the case of an event or condition that with the giving of notice or passage of time or both would constitute an Event of Default or Termination Event with respect to the party, to cause such event or condition to cease to exist before becoming an
Event of Default or Termination Event). 

  

	(i)	Relationship Between Parties. 

  

	 	(i)	Non-Reliance. Each party represents and warrants that it is acting for its own account, and it has made its own independent decisions to enter into that Transaction and as to
whether that Transaction is appropriate or proper for it is based upon its own judgment and upon advice from such advisors as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice
or as a recommendation to enter into that Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be considered investment advice or a recommendation to enter into that
Transaction. It has not received from the other party any assurance or guarantee as to the expected results of that Transaction. 

  

	 	(ii)	Evaluation and Understanding. It is capable of evaluating and understanding (on its own behalf or through independent professional advice), and understands and accepts the
terms, conditions and risks of that Transaction. It is also capable of assuming, and assumes, the financial and other risks of that Transaction. 

  

	 	(iii)	Status of Parties. The other party is not acting as a fiduciary or an advisor for it in respect of that Transaction. 

  

	(j)	Consent to Recording. The parties agree that each may electronically record all telephonic conversations between marketing and trading personnel in connection with this
Agreement and that any such recordings may be submitted in evidence in any Proceedings relating to this Agreement. 

  

	(k)	 Limited Recourse to Party B. Notwithstanding anything to the contrary contained herein, all obligations of Party B shall be payable by Party B under
Section 2(a)(i) of this Agreement only on a Party B Payment Date or Party B Interim Payment Date (each as defined in the related Confirmation of the Transaction) and only to the extent of funds available therefor in the Collateral
Account as provided in Sections 5.02, 6.03 and Section 7.02 of the Security 



  

 29 








 
Agreement and, to the extent such funds are not available or are insufficient for the payment thereof, shall not constitute a claim against Party B to the
extent of such unavailability or insufficiency until such time as Party B has assets sufficient to pay such prior deficiency; provided, however, that any termination payment in respect of the
termination of this Agreement in whole may be made on any date from amounts available under Sections 5.02, 6.03 and 7.02 of the Security Agreement. This paragraph shall survive the termination of this Agreement but in all cases
shall expire concurrently with the restriction specified in Part 5(1). 
  

	(l)	No Bankruptcy Petition. Prior to the date that is one year and one day after the payment in full of any Note issued by Party B (or such longer preference period as may be in
effect at such time), Party A, in its capacity as Swap Counterparty, shall not institute against, or join any other person in instituting against, Party B, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any federal or state bankruptcy or similar law. Nothing herein shall prevent Party A from participating in any such proceeding once commenced by another entity. The provision of this paragraph shall survive the termination of this
Agreement. 

  

	(m)	No Recourse. The obligations of Party B hereunder are solely the obligations of Party B and no recourse shall be had with respect to this Agreement, any of the obligations of
Party B hereunder or for the payment of any fee or other amount payable hereunder or for any claim based on, arising out of or relating to any provision of this Agreement against any certificateholder, stockholder, employee, officer, director,
incorporator, trustee, affiliate, agent or servant of Party B except to the extent that any such claim arises as a result of the intentional misconduct, fraud, bad faith and/or gross negligence of such persons. The provisions of this paragraph shall
survive the termination of this Agreement. 

  

	(n)	Notice of Payment Amounts. The Calculation Agent shall provide (via email or facsimile) Party A with estimates of payments to be made by each of Party A and Party B
(including a breakdown of the components of each payment) under the Agreement on the next following Payment Date, Interim Payment Date or any other date payments are made under the Agreement. Such estimates shall be provided by 12:00 noon (eastern
standard time) of the second Business Day prior to each such payment date. Final confirmation of the actual amounts to be wired shall be provided (via e-mail or facsimile and confirmed by telephone) by no later than 12:00 noon (eastern standard
time) on the Business Day immediately preceding each such payment date. 

  

	(o)	 Reduction of Swap Counterparty’s Rating. In the event that one or more of Party A’s ratings are withdrawn or reduced below the Requisite Ratings,
Party A is obligated to immediately provide written notice thereof to Party B and, within 30 Business Days after such rating withdrawal or reduction (if such withdrawal or reduction is continuing), in Party A’s discretion to effect one of the
following (i) establish any arrangement, including obtaining a Successor Swap Counterparty, such that Party B shall receive written confirmation that the rating of each Series outstanding by each applicable rating agency will not be withdrawn
or reduced below the applicable rating of each such Series outstanding immediately prior to such downgrade, as applicable, (ii) obtain replacement interest rate swap agreements with terms substantially the same as this Agreement with a
Successor Swap Counterparty, (iii) execute and deliver to Party B a 1994 ISDA Credit Support Annex (New York law) with Party A as the pledgor, or (iv) obtain a guaranty of the obligations of Party A under the Agreement from an entity
having at least the Requisite Ratings, in each case, such that Party B shall receive written confirmation that the rating of 



  

 30 








 
each Series outstanding by each applicable rating agency will not be withdrawn or reduced below the applicable rating of each such Series outstanding
immediately prior to such downgrade, as applicable; provided, however, that the preceding provisions may be modified, without the consent of the holders of the Notes, upon receipt by Party B and the
Indenture Trustee of Rating Agency Confirmation; provided, further, that Party B shall be entitled to replace Party A pursuant to this paragraph (o), after such 30 Business Day period has
expired, so long as Party A shall have not already effected one of the options described in clauses (i) through (iv) above. Any costs associated with obtaining a replacement swap agreement or establishing any other
arrangement such that Party B shall receive written confirmation that the rating of each Series outstanding by each applicable rating agency will not be withdrawn or reduced below the applicable rating of each such Series outstanding immediately
prior to such downgrade will be borne by Party A. No failure on the part of Party A to effect any of the alternatives specified above within the said 30 Business Day period shall constitute an Event of Default or Termination Date with respect to
Party A, but after such 30 Business Day period, if so designated by Party B in accordance with Part 5(u), shall constitute a Termination Event with Party A as the sole Affected Party. 
  

	(p)	Additional Swap Counterparties. To the extent that Party B enters into Interest Rate Swap agreements with other additional swap counterparties, such swap counterparties will
be required to have the Requisite Ratings at the time of execution of such Interest Rate Swaps. 

  

	(q)	Further Representations of Party B: 

  

	 	(i)	Assuming the due authorization, execution and delivery thereof by the other parties thereto, each of the Indenture and the other Program Documents to which Party B is a party
constitutes the legal, valid and binding obligations of Party B, enforceable against Party B in accordance with the terms thereof, subject to applicable bankruptcy, insolvency and similar laws or legal principles affecting creditors’ rights
generally, and subject, as to enforceability, to general principles of equity regardless of whether enforcement is sought in a proceeding in equity or at law. 

  

	 	(ii)	The Indenture and the other Program Documents to which Party B is a party are in full force and effect on the date hereof and there have been no amendments or waivers or
modifications of any of the terms thereof since the original execution and delivery of the Indenture and the other Program Documents to which Party B is a party. 

  

	 	(iii)	To the best of its knowledge, no event of default (or event which would, with the passage of time or the giving of notice, constitute an event of default) has occurred and is
continuing under any of the Program Documents to which Party B is a party. 

  

	(r)	No Set-off. Other than as provided in Section 2(c) of this Agreement, all payments hereunder shall be made without set-off or counterclaim.
Section 6(e) of the Agreement is amended by the deletion of the following sentence: “The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off.”


  

 31 









	(s)	Severability. Except as otherwise provided in Sections 5(b)(i) of the Agreement in the event that any one or more of the provisions contained in this Agreement should
be held invalid, illegal, or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby so long as this Agreement as so modified
continues to express, without material change, the original intentions of the parties as to the subject matter of this Agreement and the deletion of such portion of this Agreement will not substantially impair the respective benefits and
expectations of the parties to this Agreement. The parties shall endeavor, in good faith negotiations, to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions. 

  

	(t)	No Recourse. It is expressly understood and agreed by the parties hereto that (a) this Agreement is executed and delivered by U.S. Bank Trust National Association, not
individually or personally but solely as Owner Trustee of Party B, in the exercise of the powers and authority conferred and vested in it, (b) each of the representations, undertakings and agreements herein made on the part of Party B is made
and intended not as personal representations, undertakings and agreements by U.S. Bank Trust National Association but is made and intended for the purpose of binding only Party B, (c) nothing herein contained shall be construed as creating any
liability on U.S. Bank Trust National Association, 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 U.S. Bank Trust National Association be personally liable for the payment of any indebtedness or expenses of Party B or be liable for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by Party B under this Agreement or any other related documents. 

  

	(u)	Special Provisions in Connection with Early Termination. 

  

	 	(i)	Section 6(e) of this Agreement shall apply in connection with the occurrence of an Early Termination Date designated by Party A. Except as provided in Part
5(u)(iv), Section 6(e) of this Agreement shall apply in connection with the occurrence of an Early Termination Date designated by Party B. If Party A is entitled to receive a Settlement Amount in connection with the occurrence of an
Early Termination Date designated by Party A, the obligation of Party B to make such payment shall be subject to the Priority of Payments, and such payment shall be made pursuant to the Confirmation as part of the Party B First Floating Amount.


  

	 	(ii)	Party B shall not be entitled to designate an Early Termination Date (x) unless arising out of an Event of Default specified in Section 5(a)(i),
Section 5(a)(iii), Section 5(a)(vii) or Section 5(a)(viii) with respect to which Party A is the Defaulting Party or a Termination Event specified in Section 5(b)(i) with respect to which Party B is the
sole Affected Party) and (y) unless either: (A) a Successor Swap Counterparty is appointed and the requirements of Part 5(u)(iv) are satisfied upon designation of such Early Termination Date (including the receipt of a Rating Agency
Confirmation) or (B) the Downsize Conditions are satisfied in connection with such Early Termination Date. 

  

	 	(iii)	 If in connection with the occurrence of an Event of Default with respect to which Party B is entitled to designate an Early Termination Date (subject to this
provisions of 



  

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Part 5(u)(ii)), Party B elects to transfer Party A’s rights and duties hereunder to a Successor Swap Counterparty, Party A hereby agrees that
such assignment shall automatically be effected without the requirement of any action by Party A immediately following the later to occur of: (x) receipt by Party B of a copy of written confirmation from each Rating Agency that the ratings of
the Notes will not be withdrawn or reduced below the ratings of such Notes prior to such Event of Default or Termination Event and (y) payment or receipt of any payments required to be made or received pursuant to Part 5(u)(iv).

  

	 	(iv)	In the event of a transfer of Party A’s rights and obligations pursuant to Part 5(u) to a Successor Swap Counterparty or the replacement of the Transaction with a
substantially similar transaction with a Successor Swap Counterparty: 

  

	 	(A)	The Calculation Agent shall calculate an amount that would be payable to (or by) Party B assuming: (i) the Transaction governed by this Agreement, the back-to-back interest
rate swap transaction, dated as of the date hereof, between Party A and Accredited Home Lenders, Inc. (“Accredited”) (if any) were Terminated Transaction and, therefore, setoff or net against each other, (ii) that
Section 6(e)(i)(3) of the 1992 ISDA Multicurrency-Cross Border Master Agreement were applicable; provided, however, following the Market Quotation Method, the Calculation Agent will seek firm quotations from at least four
Reference Market-makers that satisfy the Requisite Ratings requirements and shall use reasonable efforts to select the Reference Market-maker who provided the quotation most favorable to Party A as the Successor Swap Counterparty and the Settlement
Amount shall be the quotation submitted by such Successor Swap Counterparty, (iii) that Party A was the Defaulting Party or the Affected Party (as the case may be) and (iv) that the Early Termination Date is the date the Successor Swap
Counterparty enters into or assumes its obligations under the Transaction. 

  

	 	(B)	To the extent that the Calculation Agent determines pursuant to Part 5(u)(iv)(A) that a payment to Party A would be required, Party B and Party A agree to cause the Successor
Swap Counterparty to pay such amount to Party A. Subject to Part 5(u)(iv)(D), such amount shall constitute satisfaction in full of the obligations of Party B to Party A in respect of the assignment of the Transaction to the Successor Swap
Counterparty. 

  

	 	(C)	To the extent that the Calculation Agent determines pursuant to Part 5(u)(iv)(A) that Party A would be required to make a payment, Party A and Party B agree that Party A will
pay such amount to the Successor Swap Counterparty. Subject to Part 5(u)(iv)(D), such amount shall constitute satisfaction in full of the obligations of Party A to Party B in respect of the assignment of the Transaction to the Successor Swap
Counterparty. 

  

	 	(D)	 In addition to amounts payable pursuant to Part 5(u)(iv)(B) or Part 5(u)(iv)(C), each of Party A and Party B shall make all payments pursuant to the
Confirmation through and including the Early Termination Date, and without duplication of such amounts Party A shall pay to Party B the Unpaid Amounts owing to Party B by Party A as of the Early Termination Date, and Party B shall pay to Party A the
Unpaid Amounts owing to 



  

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Party A by Party B as of the Early Termination Date. Without duplication of amounts paid by Party A to Party B pursuant to the Agreement, in the event of the
appointment of a Successor Swap Counterparty, Party A shall bear or otherwise reimburse Party B for all reasonable costs (excluding any assignment fee or termination fee, except as otherwise contemplated by Part 5(u)(iv)(C)) associated with
the actions required by Part 5(u)(iii). 
  

	 	(v)	Notwithstanding anything in the Agreement and/or this Confirmation to the contrary, following the occurrence of an Additional Termination Event pursuant to Part 1(g)(iii) of this
Agreement, no termination payments shall be payable by Party A except (A) Party A shall make all payments due pursuant to this Confirmation through and including the Early Termination Date; and (B) without duplication of the amounts
payable pursuant to the foregoing clause (A), Party A shall pay to Party B the Unpaid Amounts owing to Party B by Party A as of the Early Termination Date, and Party A shall not have any further liability to Party B in respect of the termination of
this Agreement. 

  

	 	(vi)	Additional Definitions. Capitalized terms used in this Schedule shall have the meaning set forth in Schedule I to the Security Agreement (as defined below). Additionally, the
capitalized terms set forth below shall have the following meanings: 

 “Downsize Conditions” means, prior to
the designation of an Early Termination Date by Party B, (i) the Program Size is reduced to an amount less than or equal to the Aggregate Maximum Notional Amount of each Interest Rate Swap other than the Transaction and (ii) Rating Agency
Confirmation is obtained in connection with such early termination of this Agreement. 
 “Requisite Ratings” means short-term
senior unsecured deposit ratings of “A-1+”, and “P-1” from each of S&P and Moody’s, respectively. 
 “Security Agreement” means the Security Agreement, dated as of the date hereof, between Party B, as Issuer, and the Collateral Agent, as amended from time to time. 
 “Successor Swap Counterparty” means a successor to Party A under the Transaction, or under an agreement with Party B on substantially the
same terms as the Transaction, which is a commercial bank or financial institution having the Requisite Ratings. 
  

	(v)	USA PATRIOT Act Notice. Party A hereby notifies Party B that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law
October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies Party B, which information includes the name and address of Party B and other information that will allow Party A to
identify Party B in accordance with the Act. 

  

	(w)	Notice by Facsimile Transmission. Section 12(a) is hereby amended by deleting the parenthetical “(except that a notice or other communication under Section 5
or 6 may not be given by facsimile transmission or electronic messaging system)”. 

  

 34 








 The parties executing this Schedule have executed the Agreement and have agreed as to the contents of
this Schedule. 
  

			
	HSBC BANK USA, NATIONAL ASSOCIATION
		
	By:	 	 /s/ SANDRA NICOTRA

	Name:	 	Sandra Nicotra
	Title:	 	Vice President
	
	CARMEL MOUNTAIN FUNDING TRUST
		
	By:	 	U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee on behalf of Party B
		
	By:	 	 /s/ PATRICIA M. CHILD

	Name:	 	Patricia M. Child
	Title:	 	Vice President


  

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