Lenders' Mortgage Insurance Agreement for Medallion Trust Series 2006-1G between Perpetual Trustee Company Limited, PMI Mortgage Insurance Ltd, Commonwealth Bank of Australia, and Homepath Pty Limited

  Lenders' Mortgage Insurance Provisions Securitised Tranches between Perpetual Trustee Company Limited as trustee of the Medallion Trust Series 2006-1G ABN 42 000 001 007 and PMI Mortgage Insurance Ltd ABN 70 000 511 071 and Commonwealth Bank of Australia ABN 48 123 123 124 and Homepath Pty Limited ABN 35 081 986 530 Master Agreement Number: G02540306 1 of 24  Date of Issue: 9 March 2006 1. THE INSURANCE AGREEMENT IS BETWEEN US AND THE INSURED LENDER AND THE INSURED TRUSTEE.........................................4 2. INTENTIONALLY DELETED...................................................4 3. WE RELY ON STATEMENTS MADE TO US .......................................4 DUTY OF DISCLOSURE......................................................4 NON- DISCLOSURE.........................................................5 4. IF REQUIREMENTS ARE NOT MET.............................................5 5. CONSUMER CREDIT CODE....................................................5 6. ENTERING INTO THE AGREEMENT AND THE ONCE-ONLY FEE.......................5 7. MANAGEMENT OF INSURED MORTGAGE AND LOAN ACCOUNT.........................5 8. ASSIGNMENT OF THIS AGREEMENT............................................6 9. WHAT IF THE BORROWER REQUIRES MORE MONEY?...............................6 LOAN REDRAW.............................................................6 10. CONSTRUCTION AND IMPROVEMENT LOANS......................................6 COST OVERRUNS...........................................................7 11. SECURING AND PROTECTING THE LOAN........................................7 VARIATIONS..............................................................7 12. PROTECTING YOUR RIGHTS..................................................8 13. PROTECTING THE MORTGAGED PROPERTY.......................................8 PROPERTY INSURANCE......................................................8 PROPERTY DAMAGE.........................................................8 CONTAMINATION...........................................................9 14. ACTION FOLLOWING DEFAULT BY THE BORROWER................................9 FIRST REPORTING TO US...................................................9 FURTHER REPORTS........................................................10 CONSULTATION WITH US...................................................10 2 of 24  RENTS OR OTHER AMOUNTS RECEIVED........................................10 15. HOW AND WHEN TO CLAIM FOR LOSS.........................................10 16. HOW IS THE CLAIM FOR LOSS CALCULATED?..................................11 REDUCTIONS.............................................................12 17. YOU GIVE US YOUR RIGHTS AFTER WE PAY A CLAIM...........................13 18. AFTER A CLAIM IS MADE..................................................13 REFUNDS OF AMOUNTS RECOVERED BY YOU....................................13 SHARING OF RECOVERIES..................................................13 19. TERMINATION OF THE AGREEMENT...........................................13 20. NOTICES, REPORTS AND APPLICATIONS......................................14 21. TRUSTEE PROVISIONS.....................................................14 22. GOVERNING LAW..........................................................15 JURISDICTION...........................................................15 23. PRIVACY LEGISLATION COMPLIANCE.........................................15 24. MEANING OF WORDS.......................................................16 25. SCHEDULE OF VARIABLES..................................................21 SCHEDULE 1 - ELIGIBILITY CRITERIA......................................23 3 of 24  PMI Lenders' Mortgage Insurance Provisions SOME WORDS USED IN THE PROVISIONS HAVE SPECIFIED MEANINGS WHICH ARE LISTED IN CLAUSE 24 - -------------------------------------------------------------------------------- 1. THE INSURANCE AGREEMENT IS BETWEEN US AND THE INSURED LENDER AND THE INSURED TRUSTEE 1.1 The Lenders' Mortgage Insurance Agreement (the Agreement) is a contract of insurance between Us and the Insured Lender and the Insured Trustee. A separate Agreement exists in respect of each Insured Mortgage. The Insured Mortgages are specified in the attached Schedule of Mortgages. 1.2 We agree to provide insurance against Loss on the Insured Mortgage on the terms set out in these Provisions upon payment of the once-only fee. 1.3 The Agreement consists of: 1.3.1 these Provisions (including the Schedule of Variables); and 1.3.2 the attached Schedule of Mortgages. 1.4 You are insured to the extent of the Percentage of Insurance and in the event of a claim you are reimbursed for Your loss in accordance with these provisions. - -------------------------------------------------------------------------------- 2. INTENTIONALLY DELETED - -------------------------------------------------------------------------------- 3. WE RELY ON STATEMENTS MADE TO US 3.1 The Insured Lender warrants that:- 3.1.1 The particulars and statements in the Application are true and correct; 3.1.2 The Insured Mortgage meets the Eligibility Criteria; and 3.1.3 The Loan Amount originated according to and in compliance with the Insured Lender's loan policy at the time of origination. 3.2 To the extent that any warranty is breached, and to the extent permitted by the Insurance Contracts Act 1984, PMI shall be entitled to deny or reduce its liability in respect of a claim by any insured. DUTY OF DISCLOSURE 3.3 Before You enter into a contract of insurance with Us, You have a duty, under the Insurance Contracts Act 1984, to disclose to Us every matter that You know, or could reasonably be expected to know, is relevant to our decision whether to accept the risk of the insurance and, if so, on what terms. 3.4 You have the same duty to disclose those matters to Us before You renew, extend, vary or reinstate a contract of insurance. 3.5 Your duty however does not require disclosure of a matter: 3.4.1 that diminishes the risk to be undertaken by Us; or 3.4.2 that is of common knowledge; or 4 of 24  3.4.3 that We know or, in the ordinary course of our business, ought to know; or 3.4.4 as to which compliance with Your duty is waived by Us. NON- DISCLOSURE 3.6 If You fail to comply with Your duty of disclosure, We may be entitled to reduce our liability or cancel the Agreement in respect of an individual claim. If Your non-disclosure is fraudulent, We may also have the option of avoiding the contract from its beginning. 3.7 If You have made a statement which was in fact untrue but was made on the basis of a reasonable belief that You held based on information provided by the Borrower, the statement will not be taken to be a misrepresentation. - -------------------------------------------------------------------------------- 4. IF REQUIREMENTS ARE NOT MET 4.1 If any of the obligations of the Insured Lender or the Insured Trustee or both under the Agreement are not met, then to the extent not prohibited by the Insurance Contracts Act 1984: 4.1.1 We may refuse to pay a claim; or 4.1.2 We may reduce the amount of the claim by the amount which in our opinion reasonably represents the extent to which our interests have been prejudiced by the failure to meet any such obligation; or 4.1.3 We may cancel the Agreement. - -------------------------------------------------------------------------------- 5. CONSUMER CREDIT CODE 5.1 The Consumer Credit Code may apply to the Insured Mortgage. 5.2 You are insured for Loss resulting from: 5.2.1 a credit tribunal or court ordering postponement of enforcement proceedings under Section 88 of the Consumer Credit Code; or 5.2.2 a change to the Insured Mortgage or Loan Account or both in a manner set out in Section 66 of the Consumer Credit Code: (a) agreed to by You with our prior written consent; or (b) ordered by a credit tribunal or court under Section 68 of the Consumer Credit Code. 5.3 You are not insured for Loss resulting from a credit tribunal or court: 5.3.1 reopening an unjust Insured Mortgage, Collateral Security or Loan Account under Section 70 of the Consumer Credit Code; or 5.3.2 annulling or reducing any unconscionable interest rate change, fee or charge under Section 72 of the Consumer Credit Code. - -------------------------------------------------------------------------------- 6. ENTERING INTO THE AGREEMENT AND THE ONCE-ONLY FEE You pay a once-only fee. This fee is calculated on the Loan amount. You will also have to pay any applicable stamp duty, GST, and any additional government duties, levies or charges, where applicable. You must on or prior to the Closing Date pay to Us the once-only fee, GST and any additional government duties, levies or charges, where applicable (in such amount as agreed between Us and the Bank prior to the Closing Date). Until the once-only fee, GST and any additional 5 of 24  government duties, levies or charges, where applicable, is received by Us the Agreement does not come into force. If the once-only fee is not received by Us on or before the Closing Date the Agreement does not come into force at all. Following receipt of the once-only fee, We will send You the Certificate stating the commencement date of insurance and the Expiry date of insurance. - -------------------------------------------------------------------------------- 7. MANAGEMENT OF INSURED MORTGAGE AND LOAN ACCOUNT 7.1 The Insured Mortgage and the Loan Account must be administered and managed by You or a Mortgage Manager. 7.2 We acknowledge and consent that the Servicer will be the Mortgage Manager in respect of the Insured Mortgage held by the Insured Trustee as trustee of the Series Trust. 7.3 Any other Mortgage Manager must be approved by Us in writing. 7.4 We may require You to appoint or replace the Mortgage Manager to administer and manage the Insured Mortgage and the Loan Account in the following situations: 7.4.1 Insolvency, liquidation, receivership or statutory management of You or any existing Mortgage Manager; or 7.4.2 If, after consultation with You, We are of the reasonable opinion that the administration or management of the Insured Mortgage and Loan Account is not being conducted satisfactorily. 7.5 Notwithstanding clause 7.4, We cannot require the Insured Trustee to replace the Servicer as Mortgage Manager or to appoint a new Mortgage Manager except to the extent that following a Servicer Default in relation to the Series Trust, the Insured Trustee is entitled to appoint a new Servicer in relation to the Series Trust and the Mortgage Manager proposed by Us is able to be appointed as Servicer in accordance with the Series Trust provided that: 7.5.1 The Insured Trustee must give Us notice of any circumstances or events occurring which entitle the Insured Trustee to issue to the Servicer a notice of termination of the rights and obligations of the Servicer in relation to the Series Trust (whether or not such notice is actually issued) within seven (7) days of the Insured Trustee becoming actually aware (as determined in accordance with the Series Trust) of such circumstances or events; and 7.5.2 The Insured Trustee must provide to Us a copy of any such notice issued to the Servicer under the Series Trust within seven (7) days of such notice being issued to the Servicer. - -------------------------------------------------------------------------------- 8. ASSIGNMENT OF THIS AGREEMENT You may assign your rights under the Agreement to someone else only if: o You have our prior written consent; or o it is pursuant to a substitution of the Insured Trustee under the transaction documents for the Series Trust; or o We have notified You in writing that You may do so without our consent. Within thirty (30) days of any assignment You must notify Us in writing and pay to Us any applicable fee. - -------------------------------------------------------------------------------- 9. WHAT IF THE BORROWER REQUIRES MORE MONEY? 9.1 Our prior consent is required before the advance of funds additional to the Loan Amount, which are secured by the Insured Mortgage (A Further Advance). 6 of 24  9.2 An additional fee, including GST where applicable, is payable by the Insured Lender before a Further Advance is insured. The Insured Lender will also have to pay any additional government duties, levies or charges where applicable. LOAN REDRAW 9.3 However, our prior consent to a Further Advance in not required if: 9.3.1 the Borrower's payments are equal to or in advance of the Scheduled Instalments; and 9.3.2 the Borrower only redraws up to the amount by which the Scheduled Instalments have been exceeded. 9.4 In the case of a Further Advance made in accordance with clause 9.3 such Further Advance is insured and no additional fee is payable. - -------------------------------------------------------------------------------- 10. CONSTRUCTION AND IMPROVEMENT LOANS 10.1 If the purpose of the Insured Mortgage or any part of the Insured Mortgage is for Improvements to the Mortgaged Property, then We are not obliged to pay a claim unless: 10.1.1 Before the Initial Loan Advance (a) the Borrower has entered a fixed price building contract for completion of the Improvements approved by the Insured Lender; and (b) all necessary consents and approvals from relevant statutory and other authorities are held and are current; and 10.1.2 During construction (a) if the Loan Amount is advanced progressively, the progress advances do not exceed increases in the value of the Mortgaged Property; and (b) the Improvements are completed within twelve months of the Initial Loan Advance; and (c) an amount of the Loan Amount is retained by the Insured Lender to ensure that the Improvements can be completed in accordance with the plans and specifications incorporated within the fixed price building contract approved by it; and 10.1.3 Before the Final Loan Advance a valuation Certificate is provided confirming that the completion of Improvements is in accordance with the plans and specifications. COST OVERRUNS 10.2 Cost Overruns must be paid immediately they are identified and prior to any further progress payments being paid. 10.3 We may decline to meet a claim under the Agreement until the Improvements for which the Insured Mortgage was made have been completed. 10.4 If the Insured Lender does not retain sufficient funds to complete the Improvements, We will deduct from any claim under the Agreement an amount equal to the additional amount required to complete the Improvements as assessed by a Valuer instructed by Us. - -------------------------------------------------------------------------------- 11. SECURING AND PROTECTING THE LOAN 7 of 24  11.1 The Insured Mortgage must be an enforceable registered mortgage over real estate property in Australia. You are not insured if the Insured Mortgage is not enforceable. 11.2 You must follow the procedures of a prudent lender in preparing, administering and managing the Insured Mortgage, any Collateral Security and the Loan Account. 11.3 The Insured Mortgage must be either: 11.3.1 a first mortgage; or 11.3.2 a second mortgage. 11.4 Where the Insured Mortgage is a second mortgage the following conditions must be met: 11.4.1 the Insured Lender must be the first mortgagee; and 11.4.2 the first-ranking mortgage must be equitably assigned to the Insured Trustee on the Closing Date (or such other date as the Insured Lender and We agree). 11.5 Where the Loan Account is secured by more than one mortgage the mortgages must be cross collateralised. VARIATIONS 11.6 Any variation of any Insured Mortgage (including substitution of security and partial release of security but not including any variation pursuant to an order by a Credit Tribunal or court) which results in: 11.6.1 an increase to the Loan Term of the Insured Mortgage beyond thirty (30) years; or 11.6.2 an increase in the Loan Account in respect of the Insured Mortgage beyond the Scheduled Loan Balance; or 11.6.3 an increase in the Loan to Value Ratio of the Insured Mortgage where the resultant Loan to Value Ratio exceeds 80% will be subject to a new proposal form and a new premium. - -------------------------------------------------------------------------------- 12. PROTECTING YOUR RIGHTS 12.1 During the term of the Agreement You must protect Your rights under Your Security Interest and in particular: 12.1.1 Your right to take action to recover the Loan Account must continue to exist; and 12.1.2 Your right to take action to recover the Loan Account must not be deferred except with our written consent (unless the deferment is pursuant to an order by a court or a credit tribunal, in which case You must report such an order to Us within (fourteen) 14 days of that order being made); and 12.1.3 there must be no Security Interest over the Mortgaged Property which takes priority over the Insured Mortgage other than:- (a) those We consent to in writing; or (b) a first mortgage where the conditions in clause 11 have been met; or (c) any Permitted Prior Security Interest. 12.1.4 You must give Us notice in writing of the discharges in whole of the Insured Mortgage and any Collateral Security during each six (6) monthly period 8 of 24  ending 31 May and 30 November in each year within fourteen (14) days of the end of each such period. - -------------------------------------------------------------------------------- 13. PROTECTING THE MORTGAGED PROPERTY 13.1 The Insured Lender must tell us within sixty (60) days if it becomes aware that the Mortgaged Property is defective, damaged, has been vacated or is contaminated. PROPERTY INSURANCE - INTENTIONALLY DELETED PROPERTY DAMAGE 13.3 If the Mortgaged Property suffers any damage or destruction (except reasonable wear and tear), the Insured Lender must ensure that it is restored as nearly as possible to its condition at the date of commencement of the Agreement if so required by us where we have formed the reasonable opinion that this will reduce the amount that may be claimed by you under the Agreement. 13.4 The costs of restoration are not insured under the Agreement. 13.5 However if the purpose of the Insured Mortgage or any part of the Insured Mortgage is for Improvements to the Mortgaged Property We will meet a claim under the Agreement only when the Improvements have been completed. 13.6 The Insured Lender must ensure that it is a term of the Insured Mortgage that the mortgagor under the Insured Mortgage must: 13.6.1 keep the Mortgaged Property in good condition and fix any defect; and 13.6.2 not do anything or allow anything to be done that might lower the value of the Mortgaged Property; and 13.6.3 tell You if the Mortgaged Property is seriously damaged or defective; and 13.6.4 comply with all laws, requirements, orders and notices of authorities in connection with the Mortgaged Property. CONTAMINATION 13.7 If there is Contamination of the Mortgaged Property the Insured Lender must ensure that the Contaminant has been removed and the Mortgaged Property is cleared up and restored as nearly as possible to its condition at the date of commencement of the Agreement where We have so advised You, having formed the reasonable opinion that this will reduce the amount that may be claimed by You under the Agreement. 13.8 The Insured Lender must ensure that it is a term of the Insured Mortgage that the Mortgagor: 13.8.1 declares that the Mortgaged Property is free from any unlawful Contamination; and 13.8.2 must remove any Contamination and clear up any Contamination, if the Mortgaged Property is contaminated. 13.9 The costs of removal, clean up and restoration of the Mortgaged Property arising from Contamination are not insured under this Agreement. 9 of 24  - -------------------------------------------------------------------------------- 14. ACTION FOLLOWING DEFAULT BY THE BORROWER 14.1 In the event of default by the Borrower You must follow the procedures of a prudent lender in administering and managing the Insured Mortgage, any Collateral Security and the Loan Account. FIRST REPORTING TO US 14.2 Any of the following events must be reported to Us in writing within fourteen (14)days: 14.2.1 the total amount due and unpaid under the Insured Mortgage or Loan Account or both at the end of a month is equal to or exceeds the total of ninety (90) days arrears; or 14.2.2 the Loan Amount is not repaid at the expiry of the Loan Term; or 14.2.3 You take possession of the Mortgaged Property; or 14.2.4 You become aware: (a) there has been a default under a mortgage over the Mortgaged Property other than the Insured Mortgage; or (b) another mortgagee intends to sell or has sold the Mortgaged Property; or (c) an application for winding up or administration or a petition for bankruptcy has been or is to be lodged in relation to the Borrower or any Guarantor; or (d) any meeting of the members or shareholders of the Borrower or any Guarantor is convened for the purpose of considering any resolution to wind up that Borrower or Guarantor or to put it under administration; or (e) the Borrower or any Guarantor has assigned its estate for the benefit of creditors generally; or (f) a receiver or manager has been appointed to the Borrower or any Guarantor; or (g) the Borrower intends to sell the Mortgaged Property in circumstances where a claim under the Agreement is likely to result; or (h) there has been any other default under the terms of the Insured Mortgage or Loan Account; or (i) of any material event or circumstance relating to the Mortgaged Property or any Collateral Security or both arising after the date of commencement of the Agreement. FURTHER REPORTS 14.3 At monthly or other intervals nominated by Us, the Insured Lender must provide Us with updated written reports and any documents about or affecting any reported default or event. CONSULTATION WITH US 14.4 You must continue to consult with Us following a default by the Borrower or any Guarantor. 14.5 You must not, without prior written notice to Us: 10 of 24  14.5.1 enter into possession of the Mortgaged Property, sell it, take foreclosure action or appoint any receiver or manager of the Mortgaged Property; 14.5.2 commence any legal proceedings in relation to the Insured Mortgage or any Collateral Security; or 14.5.3 if the Consumer Credit Code applies to the Insured mortgage, take any Enforcement Proceedings or make any application to a court in relation to the Insured mortgage or any Collateral Security. In this clause 14.4: Enforcement proceedings has the same meaning as that term has under the Consumer Credit Code. A court includes any court as defined under the Consumer Credit Code. Applications to a court may include applications under section 101 of the Consumer Credit Code. RENTS OR OTHER AMOUNTS RECEIVED 14.6 Any rents or profits or other amounts You receive relating to the Mortgaged Property or any Collateral Security are to be credited to the Loan Account. - -------------------------------------------------------------------------------- 15. HOW AND WHEN TO CLAIM FOR LOSS 15.1 A claim for Loss may be submitted: 15.1.1 when the sale of the Mortgaged Property has been settled; or 15.1.2 when We ask before the Mortgaged Property is sold; or 15.1.3 when the mortgagee under a prior mortgage has completed the sale of the Mortgage Property. 15.2 The claim should be lodged within thirty (30) days of: 15.2.1 the Settlement Date; or 15.2.2 a request from Us. 15.3 In support of the claim we must be provided with all documents and information We reasonably require. 15.4 Any payment of a claim We make is a full and final discharge of our liability under the Agreement. Payment of a claim to the Insured Lender will be a full and final discharge of any liability to pay a claim to the Insured Trustee and payment of a claim to the Insured Trustee will be a full and final discharge of any liability to pay a claim to the Insured Lender. 15.5 At our discretion We may pay a claim before the Mortgaged Property has been sold. 15.6 Within fourteen (14) days of receipt by Us of the complete claim documentation including all documentation and information reasonably required by Us We will assess the claim and pay the amount recoverable under this Agreement. - -------------------------------------------------------------------------------- 16. HOW IS THE CLAIM FOR LOSS CALCULATED? 16.1 The Loss is the amount owing less the amount recovered as defined below: 16.2 Amount owing is the total of: 16.2.1 Balance of the Loan Account at the Settlement Date; and 11 of 24  16.2.2 Interest on the balance of the Loan Account from the Settlement Date to the date of claim to a maximum of thirty (30) days; and 16.2.3 Any GST incurred on the sale or transfer of the Mortgaged Property to a third party in or towards the satisfaction of any debt that the Borrower owed under the Loan Account, and any GST which is properly incurred in respect of any of the costs, fees, disbursements or commissions specifically included under clause 16.2.4; and 16.2.4 Costs incurred on sale of the Mortgaged Property which include: (a) Costs properly incurred for insurance premiums, rates, land tax (calculated on a single holding basis) and other statutory charges on the Mortgaged Property; and in respect of amounts payable to a body corporate, service company or equivalent in relation to the Mortgaged Property, (b) Reasonable and necessary legal fees and disbursements incurred in enforcing or protecting rights under the Insured Mortgage including the reasonable fees and disbursements of the Servicer's internal legal department; and (c) Reasonable agent's commission, advertising costs, valuation costs and other costs relating to the sale of the Mortgaged Property; and (d) Reasonable and necessary costs incurred by You in maintaining (but not restoring) the Mortgaged Property, however total costs in excess of $1,500 can be included only with Our prior written consent to incur them; and (e) Any amounts applied with Our prior written consent to discharge a Security Interest having priority over the Insured Mortgage. 16.3 Amount owing does not include: 16.3.1 Interest charged in advance; and 16.3.2 Default rate interest; and 16.3.3 Higher rate interest payable because of failure to make prompt payment; and 16.3.4 Fines, fees or charges debited to the Loan Account (except for any monthly account keeping fee, switching fee or loan establishment fee); and 16.3.5 Costs of restoration following damage to or destruction of the Mortgaged Property; and 16.3.6 Costs of removal, clean up and restoration arising from Contamination of the Mortgaged Property; and 16.3.7 Additional funds advanced to the Borrower without Our written consent other than any loan redraws in accordance with clause 9; and 16.3.8 Amounts paid in addition to the Loan Amount to complete Improvements; and 16.3.9 Cost Overruns; and 16.3.10 Any civil or criminal penalties imposed under legislation including the Consumer Credit Code. 16.4 Amount recovered is the total of: 16.4.1 The gross proceeds of sale of the Mortgaged Property; and 12 of 24  16.4.2 Early Repayment Fees; and 16.4.3 Break Funding Costs; and 16.4.4 The following if not already applied to the credit of the Loan Account: (a) Compensation received for any part of the Mortgaged Property or any Collateral Security that has been resumed or compulsorily acquired; and (b) all rents collected and other profits received relating to the Mortgaged Property or any Collateral Security; and (c) any sums received under any insurance policy relating to the Mortgaged Property not applied to restoration of the Mortgaged Property following damage or destruction; and (d) all amounts recovered from the exercise of rights relating to any Collateral Security; and (e) any other amount received relating to the Insured Mortgage or any Collateral Security including any amounts received from the Borrower, any Guarantor, or prior mortgagee. REDUCTIONS 16.5 Where a claim has been made and the Loss has been increased due to the consent, without our written approval, to: 16.5.1 the creation of any lease, license, easement, restriction or other notification affecting the Mortgaged Property; or 16.5.2 an increase in or acceleration of the payment obligation of the Borrower under any Security Interest having priority over the Insured Mortgage; then We may reduce the amount payable to You by that increased Loss. 16.6 Where the Loss has been increased due to the making of any false or misleading statement, assurance or representation to the Borrower or any Guarantor, We may reduce the amount paid in the event of a claim by that increase in the Loss. 16.7 Where We pay any claim the amount of that payment will be less the amount of any GST input tax credit or reduced input tax credit (together Input Tax Credit) entitlement You may have with respect to the items included in the claim for Loss. - -------------------------------------------------------------------------------- 17. You give Us Your rights after We pay a claim 17.1 After We pay a claim We may require You to: 17.1.1 assign the Insured Mortgage and any Collateral Security to Us; or 17.1.2 appoint Us Your attorney to exercise any of Your rights under the Insured Mortgage and any Collateral Security. 17.2 You must comply with our reasonable requests for assistance to recover from the Borrower or any Guarantor or both the amount We pay to You in the event of a claim. - -------------------------------------------------------------------------------- 18. AFTER A CLAIM IS MADE REFUNDS OF AMOUNTS RECOVERED BY YOU 18.1 Any amount You recover relating to the Insured Mortgage or any Collateral Security after You have made a claim must be paid to Us. 13 of 24  SHARING OF RECOVERIES 18.2 However, if You sustain a Loss on the Loan Account after the sale of the Mortgaged Property and payment of a claim by Us, any recoveries under the Insured Mortgage or any Collateral Security, will be shared between You and Us on a pro-rata basis. 18.3 The calculation of the pro-rata sharing shall exclude any amounts relating to debts owed by the Borrower independent of the Loan Account such as personal loans or credit card debts. - -------------------------------------------------------------------------------- 19. TERMINATION OF THE AGREEMENT 19.1 The Agreement terminates: 19.1.1 when the Loan Account is repaid in full; or 19.1.2 on the Expiry Date of the Insurance as set out in the Schedule of Mortgages, however if before fourteen (14) days after the Expiry Date of the Insurance You have given Us notice of default under the Insured Mortgage the Agreement will continue solely for the purpose of a claim; or 19.1.3 when We pay a claim; or 19.1.4 upon cancellation of the Agreement in accordance with the Insurance Contracts Act 1984. 14 of 24  - -------------------------------------------------------------------------------- 20. NOTICES, REPORTS AND APPLICATIONS Notices, reports and the Application to Us are to be provided to: PMI Mortgage Insurance Ltd. Level 23, 50 Bridge Street SYDNEY NSW 2000 Facsimile No: 02 9251 5550 or to any other address We specify in writing. Notices to the Insured Lender are to be provided to the address stated in the Schedule of Variables or any other address the Insured Lender may specify in writing. Notices to the Insured Trustee are to be provided to the address stated in the Schedule of Variables or any other address the Insured Trustee may specify in writing. Where agreed between You and Us notices, reports and applications may be provided by mutually acceptable methods of electronic communication. - -------------------------------------------------------------------------------- 21. TRUSTEE PROVISIONS 21.1 The Insured Trustee enters into the Agreement only its capacity as trustee of the Series Trust and in no other capacity. A liability arising under or in connection with the Agreement is limited to and can be enforced against the Insured Trustee only to the extent to which it can be satisfied out of the property of the Series Trust (as case may be) out of which the Insured Trustee is actually indemnified for the liability. This limitation of the Insured Trustee's liability or obligations under the Agreement applies despite any other provision of the Agreement other than clause 21.3 and extends to all liabilities and obligations in any way connected with any representation, warranty, conduct, omission, agreement or transaction related to the Agreement. 21.2 The parties other than the Insured Trustee may not sue the Insured Trustee in any capacity other than as trustee of the Series Trust, including seeking the appointment of a receiver (except in relation to the property of Series Trust, as the case may be), a liquidator, an administrator or any similar person to the Insured Trustee or prove in any liquidation, administration or arrangement of, or affecting the Insured Trustee (except in relation to the property of Series Trust, as the case may be). 21.3 The provisions of this clause 21 shall not apply to any obligation or liability of the Insured Trustee to the extent that the Insured Trustee is not actually indemnified for the obligation or liability as a result of the Insured Trustee's fraud, negligence or breach of trust. 21.4 For the purposes of clause 21.3 it is agreed that the Insured Trustee cannot be regarded as being fraudulent, negligent or in breach of trust to the extent to which any failure by the Insured Trustee to satisfy its liabilities or obligations or breach of representation or warranty under the Agreement has been caused or contributed to by a failure of the Insured Lender, the Servicer, the Loan Originator, Mortgage Manager or the Trust Manager (being the Manager referred to in the Series Supplement) or any other person (other than a person whose acts or omissions the Insured Trustee is liable for in accordance with any Transaction Document) to fulfil its obligations in relation to the Series Trust, or any other act or omission of Insured Lender, the Servicer, the Loan Originator, the Mortgage Manager or Trust Manager or any person. 21.5 The Insured Trustee (in its capacity as trustee of the Series Trust) is not obliged to do or refrain from doing anything under the Agreement (including incur any liability) unless the Insured Trustee's liability is limited in the same manner as set out in this clause 21. 15 of 24  For the avoidance of doubt, the Insured Trustee agrees and acknowledges that its liability for any commitment or obligation it has entered into under this Agreement is limited in a manner which is consistent with this clause 21. 21.6 For the avoidance of doubt, nothing in this clause affects Our rights under this Agreement, or under the Insurance Contracts Act 1984, to avoid or reduce a claim which may be made by or on behalf of, the Insured Trustee under the Agreement or to obtain a declaration or any order to that effect. - -------------------------------------------------------------------------------- 22. GOVERNING LAW 22.1 These Provisions and the Agreement are governed by and construed in accordance with the laws of New South Wales. JURISDICTION 22.2 Each party irrevocably and unconditionally: 22.2.1 submits to the non-exclusive jurisdiction of the courts of New South Wales; 22.2.2 waives any objection it may now or in the future have to the bringing of proceedings in those courts and any claim that any proceedings have been brought in an inconvenient forum; and 22.2.3 agrees, without preventing any other mode of service permitted by law, that any document required to be served in any proceedings may be served in the manner in which notices and other written communications may be given under clause 20. 23. PRIVACY LEGISLATION COMPLIANCE In respect of each Insured Mortgage the Insured Lender: o warrants that it has complied with the Privacy Act; o acknowledges that if it gives personal information about a borrower or guarantor to us in circumstances where that borrower or guarantor has not given all necessary consents, we are at risk of contravening the Privacy Act; o will, on request by us, provide us with such information as we reasonably require to verify compliance with your obligations under the Privacy Act in relation to an Insured Mortgage; o must disclose to us as soon as practicable if it becomes aware of a breach of its obligations under the Privacy Act in respect of an Insured Mortgage; o agrees to indemnify us and keep us indemnified against any injury, cost, loss, damage, claim or liability which we may suffer, as a result of it failing to comply with this clause 23, including but not limited to any injury, loss, cost, damage, claim or liability arising out of an action brought by an individual against us pursuant to, in connection with, or arising from the Privacy Act 1988. In the section "Privacy Act" means the Privacy Act 1988, as amended by the Privacy Amendment (Private Sector) Act 2000 (including but not limited to a National Privacy Principle set out in that Act). The indemnity in this clause 23 is a continuing obligation, separate and independent from the other obligations of the parties, and survives termination, completion or expiration of this Agreement. It is not necessary for a party to incur expense or to make any payment before enforcing the right of indemnity conferred by this Agreement. 16 of 24  - -------------------------------------------------------------------------------- 24. MEANING OF WORDS APPLICATION means all information (in whatever form including but not limited tohard copy, electronic or on disk) supplied to Us (by whatever means including, but not limited to electronic mail) by You or by any third party on your behalf relating to the Insured Mortgage, the Borrower, the Mortgaged Property any other information in support of Your request for us to insure the Insured Mortgage. BORROWER means the person or entity specified as the Borrower in the Schedule of Mortgages. BREAK FUNDING COSTS means costs or Losses incurred by You as a result of the Insured Mortgage being discharged or the Loan Account being repaid or both, prior to the expiry of the loan term provided You are entitled to recover such costs or Losses from the Borrower. CLOSING DATE means the Closing Date specified in the Schedule of Variables COLLATERAL SECURITY means any security interest, other than the Insured Mortgage, You obtain as security for, or guaranteeing, the payment of the Loan Account. CONSUMER CREDIT CODE means the Consumer Credit Code set out in the Appendix to the Consumer Credit (Queensland) Act 1994 as in force and applicable for the time being in each State and Territory of Australia. CONTAMINANT means any substance the presence of which on a property renders the property in whole or in part harmful or unusable or both, including, but not limited to radioactive material, asbestos, biological agents, heavy metals and toxins. CONTAMINATION means the presence in, on or under a property of any Contaminant at a concentration above that naturally present in, on or under the property. COST OVERRUNS may occur if the purpose of the Insured Mortgage or any part of the Insured Mortgage is for Improvements to the Mortgaged Property. Cost Overruns means the cost of Improvements (including Improvements the subject of variations to the fixed price building contract) in excess of the amounts approved in the original Loan Amount and identified in the fixed priced building contract. CREDIT TRIBUNAL OR COURT means a credit tribunal or court having jurisdiction under the Consumer Credit Code. 17 of 24  EARLY REPAYMENT FEES means any fines, fees or charges You are entitled to recover from the Borrower as a result of the Insured Mortgage being discharged or the Loan Account being repaid or both prior to the expiry of the Loan Term. ELIGIBILITY CRITERIA means the Eligibility Criteria specified in the Schedule of Variables. EXPIRY DATE OF INSURANCE means the Loan Expiry Date of a loan in respect of an Insured Mortgage specified in the Schedule of Mortgages, plus thirty (30) days. FINAL LOAN ADVANCE means the last progress payment of the Loan Amount upon completion of any Improvement to the Mortgaged Property. GUARANTOR means any person who has guaranteed performance of any of the Borrower's obligations under the Insured Mortgage or Loan Account or both or provided indemnity in respect of breach of those obligations. GST means the goods and services tax as imposed by the GST Act. GST ACT means A New Tax System (Goods and Services Tax) Act 1999, or, if that Act does not exist for any reason, means any Act imposing or relating to the imposition or administration of a goods and services tax in Australia and any regulation made under that Act. IMPROVEMENTS means any construction, additions, renovations and repairs on or to the Mortgaged Property. INCLUDING OR SUCH AS when introducing an example does not limit the meaning of the words to which the example relates to that example or examples of a similar kind. INPUT TAX CREDIT has the same meaning given to that term by A New Tax System (Goods and Services Tax) Act 1999. INITIAL LOAN ADVANCE means the first advance of the Loan Amount or part of the Loan Amount and includes the only advance if the entire Loan Amount is advanced at one time. 18 of 24  INSURED LENDER means the person or entity specified as the Insured Lender in the Schedule of Variables. INSURED TRUSTEE means the person or entity specified as the Insured Trustee in the Schedule of Variables or if that person or entity retires or it's removed as trustee of the Series Trust, then any substitute trustee and includes the Trust Manager when acting as trustee of the Series Trust. ISSUE DATE means the date of payment by the Insured Lender of the once-only fee in accordance with clause 6. INSURED MORTGAGE means each of the mortgages specified in the Schedule of Mortgages. LOAN ACCOUNT means the total of the Loan Amount and interest on the Loan Amount outstanding under the Insured Mortgage. LOAN AMOUNT means the Loan Amount specified for the Insured Mortgage in the Schedule of Mortgages. LOAN ORIGINATOR means any person who, whether acting as the agent of the Insured Lender or of the Borrower or acting independently is involved in the marketing or establishment of the Insured Mortgage and may include an agent, a mortgage broker, a Mortgage Manager and a Trust Manager. LOAN TERM means the Loan Term specified for the Insured Mortgage in the Schedule of Mortgages. LOSS means Loss calculated in accordance with these Provisions. MINIMUM SCHEDULED INSTALMENTS means the instalments required to meet the Loan Agreement repayments over the term of the Loan. MORTGAGE MANAGER means a person appointed to administer and manage the Insured Mortgage and Loan Account on Your behalf. MORTGAGED PROPERTY 19 of 24  means the Mortgaged Property specified for the Insured Mortgage in the Schedule of Mortgages. PERCENTAGE OF INSURANCE means the Percentage of Insurance specified in the Schedule of Variables. PERMITTED PRIOR SECURITY INTERESTS in relation to an Insured Mortgage means any statutory charges, prior charges of a body corporate, service company or equivalent, whether registered or otherwise, which do not prevent the Insured Mortgage from being a first ranking mortgage or a second ranking mortgage (as the case may be) in accordance with the Insured Lender's lending criteria. PROVISIONS means these Lenders Mortgage Insurance Provisions Securitised Tranches. SCHEDULE OF MORTGAGES means the Schedule of Mortgages in the CD Rom in Exhibit A to these Provisions which includes details of the Insured Mortgage, the Mortgaged Property, the Borrower, the Loan Amount, the Loan Term and the Loan Expiry Date of the Insurance of the Insured Mortgage. SCHEDULE OF VARIABLES means the Schedule of Variables attached to these Provisions which includes details of the Insured Lender, the Insured Trustee, the Closing Date, the Eligibility Criteria, the Servicer, the Series Trust, and the Percentage of Insurance. SCHEDULED INSTALMENTS means the total amount due from time to time under the Insured Mortgage or Loan Account or both whether paid or unpaid. SCHEDULED LOAN BALANCE means the amount that from time to time would have been outstanding if the Minimum Scheduled Instalments had been paid when due. SCHEDULED MONTHLY INSTALMENT means the total amount payable each month (from time to time) by the Borrower to You excluding any interest charged in advance, higher rate interest payable for late payment and default rate interest. SERIES SUPPLEMENT means the Series Supplement dated 3 March 2006 between the Insured Lender, the Insured Trustee and Securitisation Advisory Services Pty Limited ABN 88 064 133 946. SERIES TRUST means the Series Trust specified in the Schedule of Variables. 20 of 24  SERVICER means the Servicer specified in the Schedule of Variables. SETTLEMENT DATE means the day the sale of the Mortgaged Property is completed. SECURITY INTEREST means any mortgage, charge, lien, pledge, trust, power or other rights given as or in effect as security for the payment of money or performance of obligations. Security Interest also includes a guarantee and an indemnity. TRUST MANAGER means a person appointed to manage a trust pursuant to which You are the mortgagee of the Insured Mortgage. VALUER means a person who is a member of the Australian Property Institute in the real property valuation category. VALUATION means a written report as to value from a person who is at the time of provision of the report a Valuer. YOU MEANS: (a) in relation to any Insured Mortgage that has been legally or equitably assigned to the Insured Trustee and has not been reassigned to the Insured Lender, the Insured Trustee; and in relation to any other Insured Mortgage, the Insured Lender; and (b) includes any Mortgage Manager or Trust Manager from time to time except where inconsistent with the context. WE OR US means PMI Mortgage Insurance Ltd., ABN 70 000 511 071, and its successors and assigns. The singular includes the plural and vice versa. A reference to anything includes the whole and each part of it. Unless defined to the contrary in the Agreement, terms in the Agreement which are defined in the Series Supplement (including terms defined by incorporation by reference to other documents) have the same meaning in the Agreement. 21 of 24  25. SCHEDULE OF VARIABLES INSURED LENDER: Commonwealth Bank of Australia ABN 48 123 123 124 and Homepath Pty Limited ABN 35 081 986 530 Level 7, 48 Martin Place Sydney NSW 2000 INSURED TRUSTEE: Perpetual Trustee Company Limited as trustee of the Medallion Trust Series 2006-1G ABN 42 000 001 007 Level 12, 123 Pitt Street Sydney NSW 2000 Fax: 02 9221 7870 CLOSING DATE: 14 March 2006 SERVICER: Commonwealth Bank of Australia ABN 48 123 123 124 SERIES TRUST: Medallion Trust Series 2006-1G PERCENTAGE OF INSURANCE: 100% 22 of 24  SIGNED as an agreement this day of THE COMMON SEAL OF PMI MORTGAGE ) INSURANCE LTD ) was hereunto affixed in the presence of: ) - --------------------------------------------- ------------------------------ Director Director/Secretary Signed, Sealed and Delivered on behalf of ) COMMONWEALTH BANK OF AUSTRALIA by its ) attorney in the presence of: ) ) - --------------------------------------------- ------------------------------ Signature of Attorney Witness - --------------------------------------------- Print Name Signed, Sealed and Delivered on behalf of ) HOMEPATH PTY LIMITED by its attorney in the ) presence of: ) - --------------------------------------------- ------------------------------ Signature of Attorney Witness - --------------------------------------------- Print Name SIGNED SEALED AND DELIVERED on behalf of ) PERPETUAL TRUSTEE COMPANY LIMITED AS TRUSTEE ) OF THE MEDALLION TRUST SERIES 2006-1G by its ) attorney in the presence of: ) - --------------------------------------------- ------------------------------ Signature of Attorney Witness - --------------------------------------------- Print Name 23 of 24  SCHEDULE 1 - ELIGIBILITY CRITERIA - -------------------------------------------------------------------------------- Eligibility Criteria in relation to each Insured Mortgage means that the Insured Mortgage must: o be in relation to a loan which has a Loan to Value Ratio (based on the outstanding balance of the housing loan and the most recent valuation of the mortgaged property, at the commencement of business on the Cut-Off Date) less than or equal to 95%; o be in relation to a loan where the Borrower is required to repay that loan within 30 years of the Cut-Off Date; o be in relation to a loan where the amount outstanding, assuming all due payments have been made by the Borrower, does not exceed A$1,000,000; o be in relation to a loan which is sourced from the general mortgage loan portfolio of Commonwealth Bank of Australia or Homepath Pty Limited; o be in relation to a loan where the Borrower is not an employee of either Insured Lender who is paying a concessional rate of interest under the Insured Mortgage as a result of such employment; o be in relation to a loan which was advanced in, and is repayable in, Australian dollars; o be in relation to a loan where no payment from the Borrower under the Loan Account is in arrears by more than thirty (30) consecutive days; o be over Land which has erected on or within it a residential dwelling or unit; and o be in relation to a loan which is or has been fully drawn. 24 of 24