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e e Section 17. PAYMENT PROCEDURE PURSUANT TO MUNICIPAL BOND GUARAN1Y INSURANCE POUCY. As long as the Municipal Bond Guaranty Insurance Policy shall be in full force and effect, the City and the Paying AgentlRegistrar agree to comply with the following provisions: (a) If payment of principal or interest due on the Bonds has not been made to the Paying AgentlRegistrar or any owner of Bonds to whom such payment is due, the Paying AgentlRegistrar shall so notify AMBAC Indemnity by telephonic or telegraphic notice, subsequently confirmed in writing, or written notice by registered or certified mail. Such notice shall specify the amount of the anticipated deficiency, the Bonds to which such deficiency is applicable, and whether such Bonds will be deficient as to principal or interest, or both. AMBAC Indemnity, on the later of the date due for payment or within one business day after receipt of notice of nonpayment, will deposit sufficient moneys with United States Trust Company of New York, as Insurance Trustee for AMBAC Indemnity or any successor insurance trustee (the "Insurance Trustee"). (b) The Paying AgentlRegistrar shall, after giving notice to AMBAC Indemnity as provided in (a) above, make available to AMBAC Indemnity and, at AMBAC Indemnity's direction, to the Insurance Trustee, the registration books of the City maintained by the Paying AgentlRegistrar, and all records relating to the Funds and Accounts maintained under this Ordinance. (c) The Paying AgentlRegistrar shall provide AMBAC Indemnity and the Insurance Trustee with a list of registered owners of the Bonds entitled to receive principal or interest payments from AMBAC Indemnity under the terms of the Municipal Bond Guaranty Insurance Policy, and shall make arrangements with the Insurance Trustee to (i) mail checks or drafts to the registered owners of Bonds entitled to receive full or partial interest payments from AMBAC Indemnity and (ii) pay principal upon Bonds surrendered to the Insurance Trustee by the registered owners of Bonds entitled to receive full or partial principal payments from AMBAC Indemnity. (d) The Paying AgentlRegistrar shall, at the time it provides notice to AMBAC Indemnity pursuant to (a) above, notify registered owners of Bonds entitled to receive the payment of principal or interest thereon from AMBAC Indemnity (i) as to the fact of such entitlement, (ii) that AMBAC Indemnity will remit to them all or a part of the interest payments next coming due, (iii) that should that be entitled to receive full payment of principal from AMBAC Indemnity, they must present and surrender their Bonds together with any appropriate instrument of assignment for payment to the Insurance Trustee, and not the Paying AgentlRegistrar, and (iv) that should they be entitled to receive partial payment of principal from AMBAC Indemnity, they must present and surrender their Bonds for payment thereon first to the Paying AgentlRegistrar, who shall note on such Bonds the portion of the principal paid by the Paying AgentlRegistrar, and then, along with an appropriate instrument of assignment, to the Insurance Trustee, which will then pay the unpaid portion of principal. The Insurance Trustee shall disburse to registered owners of Bonds, through the Paying AgentlRegistrar, the payment due less any amount held by the Paying AgentlRegistrar for payment of principal of or interest on Bonds and legally available therefor. (e) In the event that the Paying AgentlRegistrar has notice that any payment of principal of or interest on a Bond which has become due for payment and which is made to an owner of a Bond by or on behalf of the City has been deemed a preferential transfer and theretofore recovered from its registered owner pursuant the United States Bankruptcy Code by a trustee in 19