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<br />8 <br />4846-5351-8811v3/200434-0005 <br />and interest on the investment; or (ii) deliver Permitted Collateral as <br />provided below. <br />e. The investment agreement must provide for termination thereof if the <br />provider’s ratings are suspended, withdrawn or fall below A3 from <br />Moody’s or A- from S&P. Within ten (10) days, the provider shall <br />repay the principal amount plus any accrued interest on the <br />agreement, without penalty to the City. <br />f. The investment agreement shall provide for the delivery of collateral <br />described in (i) or (ii) below (“Permitted Collateral”) which shall be <br />maintained at the following collateralization levels at each valuation <br />date: <br />(i) U.S. Government Securities at 104% of principal plus accrued <br />interest; or <br />(ii) Obligations of GNMA, FNMA or FHLMC (described in 2(d), <br />3(a) and 3(b) above) at 105% of principal and accrued <br />interest. <br />g. The investment agreement shall require the Trustee to determine the <br />market value of the Permitted Collateral not less than weekly and <br />notify the investment agreement provider on the valuation day of any <br />deficiency. Permitted Collateral may be released by the Trustee to the <br />provider only to the extent that there are excess amounts over the <br />required levels. Market value, with respect to collateral, may be <br />determined by any of the following methods: <br />(i) the last quoted “bid” price as shown in Bloomberg, Interactive <br />Data Systems, Inc., The Wall Street Journal or Reuters; <br />(ii) valuation as performed by a nationally recognized pricing <br />service, whereby the valuation method is based on a <br />composite average of various bid prices; or <br />(iii) the lower of two bid prices by nationally recognized dealers. <br />Such dealers or their parent holding companies shall be rated <br />investment grade and shall be market makers in the securities <br />being valued. <br />h. Securities held as Permitted Collateral shall be free and clear of all <br />liens and claims of third parties, held in a separate custodial account <br />and registered in the name of the Trustee or the Agent. <br />i. The provider shall grant the Trustee a perfected first security interest <br />in any collateral delivered under an investment agreement. For <br />investment agreements collateralized initially and in connection with <br />the delivery of Permitted Collateral under 10(f) above, the Trustee <br />shall receive an opinion of counsel as to the perfection of the security <br />interest in the collateral.