SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





Form 10-K





(Mark one)

|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended December 31, 2007

Or



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from  to

Commission File Number 333-74817





MAIN PLACE FUNDING, LLC

(Exact name
of registrant as specified in its charter)







|                                                               |  |                                        
|-------------------------------------------------------------- |  | ---------------------------------------
|Delaware                                                       |  | 57-0236115                             
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification Number)

9 W 57thStreet New York, NY 10019

(Address of principal executive
offices) (Zip Code)

(212) 583-8078

(Registrants telephone number, including area code)





Securities registered
pursuant to Section 12(b) of the Act: NONE

Securities registered pursuant to Section 12(g) of the Act: NONE





Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Act.    Yes   ̈    No  x

Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  x    No   ̈

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No   ̈

Indicate by check mark if disclosure of
delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.    Yes  x    No   ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated
filer and large accelerated file in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer   ̈    Accelerated filer   ̈    Non-accelerated filer  x

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act).    Yes   ̈    No  x

As of December 31, 2007, the aggregate
market value of the voting and non-voting common equity held by non-affiliates was $0.

On March 31, 2008, there were no shares of common stock
outstanding. As of March 31, 2008, Bank of America, N.A. holds 100 percent membership interest in Main Place.

THE REGISTRANT MEETS THE CONDITIONS
SET FORTH IN GENERAL INSTRUCTION I (1) (a) AND (b) OF FORM 10-K AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT PERMITTED BY GENERAL INSTRUCTION I (2) OF THE FORM 10-K.

Documents Incorporated by reference: None









---

PART I



|Item 1. | BUSINESS
|------- | --------

General

Main Place Funding, LLC (Main Place), a Delaware limited liability company, is a wholly owned subsidiary of Bank of America, N.A. (the Parent),
which is a wholly owned indirect subsidiary of Bank of America Corporation (the Corporation).

Main Place is the successor by merger of Main
Place Real Estate Investment Trust (MPREIT) with and into Main Place. MPREIT was established on October 29, 1996 as a Maryland real estate investment trust to consolidate the acquisition, holding and management of certain closed-end
residential mortgage loans owned by certain affiliates of the Corporation. MPREIT was the successor by merger of Main Place Funding Corporation (MPFC) with and into MPREIT on November 1, 1996. On October 15, 1998, Main Place
Holdings Corporation, the former parent of MPREIT, merged with and into Main Place, and on December 23, 1998, MPREIT merged with and into Main Place, its parent company.

As a result of the December 23, 1998 merger, the Parent held a 99 percent membership interest in Main Place. Main Place Trust, a Delaware business trust, held the other 1 percent membership interest. In
connection with the merger of MPREIT with and into Main Place, all outstanding MPREIT Class A Trust Shares were cancelled. All outstanding MPREIT Class B Trust Shares were converted into rights to receive cash. In connection with the merger
with MPREIT, Main Place assumed MPREITs obligations under the Series 1995-2 and Series 1997-1 mortgage-backed bonds. On August 15, 2002, Main Place Trust was liquidated into the Parent. Currently the Parent holds a 100 percent membership
interest in Main Place.

On October 21, 2002, Main Place adopted an Amended and Restated Limited Liability Company Agreement, which removed certain
restrictions on the business activities of Main Place and permitted it to engage in any activity and to exercise any powers permitted to limited liability companies under the laws of the State of Delaware.

Financial Warranty Agreements

Main Place is in the business of
entering into financial warranty agreements with third parties. As of December 31, 2007, Main Place was a party to three financial warranty agreements with third-party trusts. These trusts are open-ended diversified, registered investment
companies. Under the terms of these warranty agreements, Main Place provides financial warranties in order to ensure that the trusts are able to redeem all of the outstanding shares of specified series on the warranty maturity dates for an amount at
least equal to an aggregate protected amount. For each of the agreements entered into by Main Place with a third party, Main Place has also entered into a financial warranty agreement with the Parent. Under the terms of these agreements, the Parent
provides financial warranties in favor of Main Place corresponding to Main Places obligations under the financial warranties with the third parties.

Main Places financial warranties are structured to include investment constraints and certain pre-defined triggers that would require the underlying assets or portfolio of the relevant trust to be liquidated and invested in
zero-coupon bonds and/or corporate bonds that mature at a preset future date. Main Place is required to fund any shortfall at the preset future date between the value of the trusts assets and a preset amount. These financial warranties are
recorded as derivatives on the balance sheet and marked to market with adjustments recorded in the statement of income. As of December 31, 2007, the aggregate net asset value of outstanding shares subject to these financial warranties with
third party trusts totaled $255.8 million. Main Place has never made a payment to fund any shortfall amount under these products and management believes that the probability of such a payment under these financial warranties is remote.

Pioneer Principal Protection Trust Agreement

On October 29,
2002, Main Place entered into a financial warranty agreement with Pioneer Principal Protection Trust on behalf of its series Pioneer Protected Principal Plus Fund and Pioneer Investment Management, Inc. The trust is an open-ended diversified,
registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty to the trust in the amount of up to $180.3 million in order to ensure that the
trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is January 8, 2010.



1



---

On December 20, 2002, Main Place entered into a financial warranty agreement with the Parent. Under the terms of
this agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $180.3 million, corresponding to Main Places obligations under the financial warranty in favor of Pioneer Principal Protection Trust on
behalf of its series, Pioneer Protected Principal Plus Fund.

Merrill Lynch Principal Protected Trust Agreements

On November 1, 2002, Main Place entered into a financial warranty agreement with Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch
Fundamental Growth Principal Protected Fund and Merrill Lynch Investment Managers, L.P. The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the
agreement, Main Place provided a financial warranty in the amount of up to $265.9 million in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty
agreement. The last day upon which the financial warranty may be drawn is December 1, 2009.

On November 13, 2002, Main Place entered into a
financial warranty agreement with the Parent. Under the terms of this agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $265.9 million, corresponding to Main Places obligations under the
financial warranty in favor of Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Fundamental Growth Principal Protected Fund.

On November 1, 2002, Main Place also entered into a financial warranty agreement with Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Basic Value Principal Protected Fund and Fund Asset Management, L.P.
The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty in the amount of up to $335.8 million
in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is December 1,
2009.

On November 13, 2002, Main Place also entered into a financial warranty agreement with the Parent. Under the terms of this agreement, the
Parent provided a financial warranty in favor of Main Place in the amount of up to $335.8 million, corresponding to Main Places obligations under the financial warranty in favor of Merrill Lynch Principal Protected Trust, on behalf of its
series Merrill Lynch Basic Value Principal Protected Fund.

On January 20, 2004, a termination agreement was entered into among Main Place and the
Parent. Under the terms of this termination agreement, the Parent is no longer committed to provide the financial warranty discussed above. Consistent with Main Places warranty with Oppenheimer Principal Protected Trust II, no warranty was
issued under the financial warranty agreement.

On February 15, 2006, BlackRock, Inc. & Merrill Lynch agreed to merge their investment
management businesses. As part of the merger with BlackRock, the Merrill Lynch Principal Protected Trust Agreements became the BlackRock Principal Protected Trust Agreements on September 29, 2006 when the merger was completed.



|Item 1A. | RISK FACTORS
|-------- | ------------

Based on Main Places business operations and
financial condition, including the fact that Main Place has no outstanding securities, Main Place does not believe that it is subject to material risk factors.

However, Main Places business characteristics include risk factors that could have an impact on the financial condition. Changes in interest could affect not only the interest income on time deposits, but also the fair value of
derivative assets and liabilities. In the event of market volatility, factors such as underlying market movements and liquidity may have an adverse impact on the volatility of warranty price and the Companys financial condition.



2



---

|Item 1B. | UNRESOLVED STAFF COMMENTS
|-------- | -------------------------

None.



|Item 2. | PROPERTIES
|------- | ----------

Main Place does not own or lease any physical property
and no such property is necessary for the conduct of Main Places business.



|Item 3. | LEGAL PROCEEDINGS
|------- | -----------------

Main Place has no material legal actions or
proceedings pending against it.



|Item 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
|------- | ---------------------------------------------------

Omitted in
accordance with General Instruction I (2) (c) to Form 10-K.

PART II



|Item 5. | MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|------- | ----------------------------------------------------------------------------------------------------------------

All of Main Places membership interests are owned by the Parent, and as a result there is no public trading market for the interests. Main Place may from time to
time make distributions to the Parent. On August 21, 2007, Main Place distributed $6.4 billion to the Parent, of which $3.8 billion of capital return and $2.6 billion of dividend payment. The distribution was provided as Main Place was in an
excess cash position of $7.4 billion at July 2007. After distribution, Main Place still had enough cash to cover the remaining contract guarantees. No distribution was made to the Parent in 2006. There are no limitations on Main Places ability
to make distributions to the Parent contained in its Amended and Restated Limited Liability Company Agreement, the financial warranty agreements, any forms of indebtedness or guarantees, or other agreements.

Main Place does not have any equity compensation plans under which its equity securities are issued. Main Place did not issue or repurchase any of its equity securities
during 2007.



|Item 6. | SELECTED FINANCIAL DATA
|------- | -----------------------

Omitted in accordance with General
Instruction I (2) (a) to Form 10-K.



|Item 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

General

Main Places primary business activity in 2003 and beyond is presently expected to be entering
into financial warranty agreements in favor of third parties for a fee.

2007 compared to 2006

Total income for the year ended December 31, 2007 was $255.6 million, representing an decrease of $100.3 million compared to 2006. The decrease was primarily a
result of decreased interest on time deposits placed due to a lower time deposit balance. In addition, trading losses and fees for the year ended December 31, 2007 increased $98 thousand, to a loss of $239 thousand. The increased trading losses
were due primarily to the lower present value caused by higher interest rate and the decrease in the aggregate net asset value of outstanding shares subject to the financial warranty agreements.



3



---

Total expense (excluding income taxes) for the year ended December 31, 2007 were $212 thousand, representing
decrease of $2 thousand compared to 2006.

Total net income for the year ended December 31, 2007 was $170.2 million, representing a decrease of $49.8
million from 2006. As discussed above, the decrease was primarily a result of decreased interest on time deposits placed due to smaller cash balance. Income tax expense for the year ended December 31, 2007 was $85.1million, representing a
decrease of $50.5 million from 2006 due to decreased interest income.

2006 compared to 2005

Total income for the year ended December 31, 2006 was $355.8 million, representing an increase of $130.1 million compared to 2005. The increase was primarily a
result of increased interest on time deposits placed due to higher interest rates. In addition, trading losses and fees for the year ended December 31, 2006 decreased $1.1 million, to a loss of $141 thousand. The decreased trading losses were
due primarily to the decrease in the aggregate net asset value of outstanding shares subject to the financial warranty agreements reducing the value of the agreements.

Total expenses (excluding income taxes) for the year ended December 31, 2006 were $214 thousand, representing a increase of $8 thousand compared to 2005.

Total net income for the year ended December 31, 2006 was $220.0 million, representing an increase of $83.1 million from 2005. As discussed above, the increase was
primarily a result of increased interest on time deposits placed due to higher interest rates. Income tax expense for the year ended December 31, 2006 was $135.6 million, representing an increase of $47.0 million from 2005 due to increased
interest income.

Liquidity & Capital Resources

Main Places primary source of liquidity is its cash and cash equivalents on hand and interest income thereon. At December 31, 2007, Main Place had approximately $1.2 billion in cash and cash equivalents, which were held as time
deposits and cash with the Parent. At December 31, 2007, Main Places maximum obligation under the financial warranties was $782.0 million. Main Place has never made a payment to fund any shortfall amount under these products and
management believes that the probability of such a payment under these financial warranties is remote.

Critical Accounting Estimates and Principles

Main Places significant accounting principles are described in Note 2 of the financial statements and are essential to understanding
Managements Discussion and Analysis of Financial Condition and Results of Operations. Some of Main Places accounting principles require significant judgment to estimate values of either assets or liabilities. In addition, certain
accounting principles require significant judgment in applying the accounting principles to individual transactions to determine the most appropriate treatment. We have established procedures and processes to facilitate making the judgments
necessary to prepare financial statements.

The following is a summary of the more judgmental and critical accounting estimates and principles. In each
area, we have identified the variables most important in the estimation process. Management has used the best information available to make the estimations necessary to value the related assets and liabilities. Actual performance that differs from
our estimates and future changes in the key variables could change future valuations and impact net income.

Derivative Assets and Liabilities

Main Place engages in derivative trading-related activities. The management process related to the derivative positions is discussed in detail in the
Quantitative and Qualitative Disclosures About Market Risk section in Item 7A. Trading positions recorded on the balance sheet are at estimated fair value.

Income Taxes

Main Place estimates tax expense based on the amount it expects to owe as part of a tax allocation agreement with the
Corporation, inclusive of current state taxes payable to the Parent. Taxes are discussed in more detail in Note 5 of the financial statements. Accrued income taxes represent the net estimated amount due or to be received from taxing authorities. In
estimating accrued income taxes, Main Place assesses the relative merits and risks of the appropriate tax treatment of transactions taking into account statutory, judicial and regulatory guidance in the context of its tax position.



4



---

Contractual Obligation

Main Place has entered into financial warranty agreements with the Parent. Under the terms of these agreements, the Parent provides financial warranties in favor of Main Place and Main Place have fees to the Parent. The below table is the
best estimate of contractual obligation that Main Place due to the Parent based on the net asset value of the aforementioned funds as of December 31, 2007.

Contractual Liability Table



|                          |  |                       |       |                  |   |           |  |           |       |  |   |  
|------------------------- |  | --------------------- | ----- | ---------------- | - | --------- |  | --------- | ----- |  | - | -
|(Dollars in thousands)    |  | Payment due by period
|Contractual Obligation    |  | Total                 |       | Less than 1 Year |   | 1-3 Years |  | 3-5 Years
|Fee to Parent (ML Value)  |  | $                     | 1,657 |                  |   | 920       |  |           | 737   |  |   | 
|Fee to Parent (ML Growth) |  | $                     | 972   |                  |   | 540       |  |           | 432   |  |   | 
|Fee to Parent (Pioneer)   |  | $                     | 467   |                  |   | 243       |  |           | 224   |  |   | 
|                          |  |                       |       |                  |   |           |  |           |       |  |   |  
|Total                     |  | $                     | 3,096 |                  | $ | 1,703     |  | $         | 1,393 |  | $ | 
|                          |  |                       |       |                  |   |           |  |           |       |  |   |  



|Item 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|-------- | ----------------------------------------------------------

Market Risk Management

Trading profits (losses) and fees represent the amount earned or lost from derivative positions. Derivative
positions are marked to market and are recorded based on managements assessment of market value using market indicators and mathematical models. Trading profits (losses) and fees can be volatile and are largely driven by general market
conditions and customer demand. Profit or loss is dependent on the volume and type of transactions, the level of risk assumed, and the volatility of price and rate movements at any given time within the ever-changing market environment.

Main Place has hedged the market risk on the financial warranties by entering into corresponding warranties with the Parent. Main Place has determined that the fair
value of these derivatives is best modeled as the present value of the future cash in-flows less the expected pay out on the warranties, if any. Currently, Main Place management has estimated that there is no likely payment on these warranties.

There are numerous assumptions and estimates associated with modeling, and actual results could differ. In addition to the regular review of our
assumptions, we mitigate these uncertainties through close monitoring and by examining and updating assumptions on an ongoing basis. If the results of our analysis indicate higher than expected levels of risk, proactive measures are taken to adjust
risk levels.



|Item 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|------- | -------------------------------------------

The financial
statements required are listed in the Index to Financial Statements and are incorporated herein by reference.



|Item 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|------- | ------------------------------------------------------------------------------------

There were no changes in or disagreements with accountants on accounting and financial disclosures.



5



---

|Item 9A. | CONTROLS AND PROCEDURES
|-------- | -----------------------

Main Places disclosure controls and
procedures are designed to ensure that information required to be disclosed under the Exchange Act securities laws is accumulated and communicated to management, including Main Places President and Principal Financial and Accounting Officer.

As of the end of the period covered by this report and pursuant to Rule 15d-15(b) under the Securities Exchange Act of 1934, Main Place carried out an
evaluation, with the participation of Main Places management, including Main Places President and Principal Financial and Accounting Officer, of the effectiveness and design of Main Places disclosure controls and procedures as
defined under rule 15d-15(e) under the Securities Exchange Act of 1934. Based upon that evaluation, Main Places President and Principal Financial and Accounting Officer, concluded, as of the end of the period covered by this report, that Main
Places disclosure controls and procedures were effective in recording, processing, summarizing and reporting information required to be disclosed by Main Place, within the time periods specified in the Securities and Exchange Commissions
rules and forms. In addition, there have been no changes in Main Places internal control over financial reporting during the quarter ended December 31, 2007 that have materially affected, or are reasonably likely to materially affect,
Main Places internal control over financial reporting.



|Item 9B. | OTHER INFORMATION
|-------- | -----------------

None.

PART III



|Item 10. | DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
|-------- | --------------------------------------------------

Omitted in
accordance with General Instruction I (2) (c) to Form 10-K.



|Item 11. | EXECUTIVE COMPENSATION
|-------- | ----------------------

Omitted in accordance with General
Instruction I (2) (c) to Form 10-K.



|Item 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|-------- | ----------------------------------------------------------------------------------------------

Omitted in accordance with General Instruction I (2) (c) to Form 10-K.



|Item 13. | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
|-------- | ----------------------------------------------

Omitted in
accordance with General Instruction I (2) (c) to Form 10-K.



|Item 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES
|-------- | --------------------------------------

During the fiscal years
ended December 31, 2007 and 2006, Main Place engaged PricewaterhouseCoopers LLP, as an independent registered public accounting firm principally to perform the annual audit and to render other services, as needed. The following table lists fees
paid to PricewaterhouseCoopers LLP, for services rendered in fiscal years 2007 and 2006.



|           |  |      |         |      |   |         
|---------- |  | ---- | ------- | ---- | - | --------
|           |  | 2007 |         | 2006
|Audit Fees |  | $    | 119,000 |      | $ | 112,0000

Audit fees include fees for services performed following the standards of the Public Company Accounting Oversight
Board for the recurring audit of Main Places financial statements. This category also includes fees for audits provided in connection with statutory filings or services that generally only the principal auditor reasonably can provide to a
client, such as procedures related to financial statement creation and related adjustments, consents and assistance with and review of documents filed with the Securities and Exchange Commission (SEC).



6



---

There were no fees paid for audit related, tax or other services rendered to Main Place by PricewaterhouseCoopers LLP in
2007 and 2006.

Main Places management, including Main Places President and Principal Financial and Accounting Officer, has adopted procedures
for pre-approving certain audit and non-audit services provided by the independent registered public accounting firm. These procedures include reviewing a budget for certain audit and permitted non-audit services. The budget includes a description
of, and a budgeted amount for, particular categories of non-audit services that are recurring in nature and therefore anticipated at the time the budget is submitted. Approval from Main Places management is required to exceed the budget amount
for a particular category of non-audit services and to engage the independent registered public accounting firm for any non-audit services not included in the budget. For both types of pre-approval, Main Places management considers whether
such services are consistent with SEC rules on auditor independence. Main Places management also considers whether the independent registered public accounting firm is best positioned to provide the most effective and efficient service, for
reasons such as its familiarity with Main Places business, people, culture, accounting systems, risk profile, and whether the services enhance the Companys ability to manage or control risks and improve audit quality.

PART IV



|Item 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|-------- | ------------------------------------------



|a. | The financial statements listed in the Index to Financial Statements are filed as part of this report.
|-- | ------------------------------------------------------------------------------------------------------



|b. | The exhibits filed as part of this report are listed in the Index to Exhibits.
|-- | ------------------------------------------------------------------------------

Supplementary Information to be Furnished With Reports filed Pursuant to

Section 15(d) of the
Act by Registrants Which Have Not Registered

Securities Pursuant to Section 12 of the Act.

No annual report or proxy materials have been sent to security holders during the fiscal year ended December 31, 2007. No annual report or proxy materials will be
sent to security holders subsequent to the filing of this annual report on Form 10-K.



7



---

SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



|                     |  |                                           
|-------------------- |  | ------------------------------------------
|                     |  | Main Place Funding, LLC                   
|                     | 
|Date: March 31, 2008 |  | /s/ George C. Carp                        
|                     |  | George Carp                               
|                     |  | Principal Financial and Accounting Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the dates indicated.



|                      |  |                                            |  |               
|--------------------- |  | ------------------------------------------ |  | --------------
|Signature             |  | Title                                      |  | Date          
|                      |  |                                           
|/s/ Matthew B. Smith  |  | President (Principal Executive Officer)    |  | March 31, 2008
|Matthew B. Smith      |  |                                            |  |               
|                      |  |                                           
|/s/ George C. Carp    |  | Principal Financial and Accounting Officer |  | March 31, 2008
|George C. Carp        |  |                                            |  |               
|                      |  |                                           
|Bank of America, N.A. |  |                                            |  |               
|                      |  |                                           
|/s/ Eric Hambleton    |  | Managing Member                            |  | March 31, 2008
|Eric Hambleton        |  |                                            |  |               



8



---

MAIN PLACE FUNDING, LLC

INDEX TO FINANCIAL STATEMENTS



|                                                                                             |  |     
|-------------------------------------------------------------------------------------------- |  | ----
|                                                                                             |  | Page
|Report of Independent Registered Public Accounting Firm                                      |  | 10  
|                                                                                             | 
|Financial Statements                                                                         |  |     
|                                                                                             | 
|Statement of Income for the Years Ended December 31, 2007, 2006 and 2005                     |  | 11  
|                                                                                             | 
|Balance Sheet as of December 31, 2007 and 2006                                               |  | 12  
|                                                                                             | 
|Statement of Cash Flows for the Years Ended December 31, 2007, 2006 and 2005                 |  | 13  
|                                                                                             | 
|Statement of Changes in Members Equity for the Years Ended December 31, 2007, 2006 and 2005 |  | 14  
|                                                                                             | 
|Notes to Financial Statements                                                                |  | 15  



9



---

Report of Independent Registered Public Accounting Firm

To the Member of Main Place Funding, LLC:

In our opinion, the accompanying balance sheet and the related statement of income, statement of changes members equity and statement of cash flows present fairly,
in all material respects, the financial position of Main Place Funding, LLC (the Company) at December 31, 2007 and 2006, and the results of its operations and its cash flows for the years then ended in conformity with accounting
principles generally accepted in the United States of America. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.



|                              
|------------------------------
|/s/ PricewaterhouseCoopers LLP
|Charlotte, North Carolina     
|March 31, 2008                



10



---

Main Place Funding, LLC

Statement of Income

(Dollars in Thousands)



|                                     |  |                        |         |   |      |   |         |      |  |   |         |  
|------------------------------------ |  | ---------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                     |  | Year Ended December 31 |        
|                                     |  | 2007                   |         |   | 2006 |   |         | 2005 | 
|Income                               |  |                        |         |   |      |   |         |      |  |   |         |  
|Interest on time deposits placed     |  | $                      | 255,794 |   |      | $ | 355,990 |      |  | $ | 226,970 |  
|Trading losses and fees              |  |                        | (239    | ) |      |   | (141    | )    |  |   | (1,214  | )
|                                     |  |                        |         |   |      |   |         |      |  |   |         |  
|Total income                         |  |                        | 255,555 |   |      |   | 355,849 |      |  |   | 225,756 |  
|                                     |  |                        |         |   |      |   |         |      |  |   |         |  
|Expenses                             |  |                        |         |   |      |   |         |      |  |   |         |  
|Other general and operating expenses |  |                        | 212     |   |      |   | 214     |      |  |   | 206     |  
|                                     |  |                        |         |   |      |   |         |      |  |   |         |  
|Total expenses                       |  |                        | 212     |   |      |   | 214     |      |  |   | 206     |  
|                                     |  |                        |         |   |      |   |         |      |  |   |         |  
|Income before income taxes           |  |                        | 255,343 |   |      |   | 355,635 |      |  |   | 225,550 |  
|Income tax expense                   |  |                        | 85,142  |   |      |   | 135,643 |      |  |   | 88,645  |  
|                                     |  |                        |         |   |      |   |         |      |  |   |         |  
|Net income                           |  | $                      | 170,201 |   |      | $ | 219,992 |      |  | $ | 136,905 |  
|                                     |  |                        |         |   |      |   |         |      |  |   |         |  

See accompanying notes to financial statements. The accompanying notes are an integral part of these financial
statements



11



---

Main Place Funding, LLC

Balance Sheet

(Dollars in Thousands)



|                                      |  |                 |           |                 |   |          
|------------------------------------- |  | --------------- | --------- | --------------- | - | ---------
|                                      |  | December 312007 |           | December 312006
|Assets                                |  |                 |           |                 |   |          
|Cash and cash equivalents             |  | $               | 1,159,406 |                 | $ | 7,383,160
|Derivative assets                     |  |                 | 3,794     |                 |   | 7,162    
|Interest receivable                   |  |                 | 453       |                 |   | 32,098   
|Accounts receivable from customer     |  |                 | 172       |                 |   | 220      
|                                      |  |                 |           |                 |   |          
|Total assets                          |  | $               | 1,163,825 |                 | $ | 7,422,640
|                                      |  |                 |           |                 |   |          
|Liabilities                           |  |                 |           |                 |   |          
|Accrued expenses due to affiliates    |  | $               | 106,572   |                 | $ | 116,360  
|Derivative liability to affiliate     |  |                 | 2,854     |                 |   | 5,387    
|Other liabilities                     |  |                 | 269       |                 |   | 244      
|                                      |  |                 |           |                 |   |          
|Total liabilities                     |  |                 | 109,695   |                 |   | 121,991  
|                                      |  |                 |           |                 |   |          
|                                      |  |                
|Members Equity                       |  |                 |           |                 |   |          
|Contributed equity                    |  |                 | 1,000,338 |                 |   | 4,770,338
|Undistributed income                  |  |                 | 53,792    |                 |   | 2,530,311
|                                      |  |                 |           |                 |   |          
|Total members equity                 |  |                 | 1,054,130 |                 |   | 7,300,649
|                                      |  |                 |           |                 |   |          
|Total liabilities and members equity |  | $               | 1,163,825 |                 | $ | 7,422,640
|                                      |  |                 |           |                 |   |          

See accompanying notes to financial statements. The accompanying notes are an integral part of these financial
statements



12



---

Main Place Funding, LLC

Statement of Cash Flows

(Dollars in Thousands)



|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  
|-------------------------------------------------------------- |  | ---------------------- | ---------- | - | ---- | - | --------- | ---- |  | - | --------- | -
|                                                               |  | Year Ended December 31 |           
|                                                               |  | 2007                   |            |   | 2006 |   |           | 2005 | 
|Operating Activities                                           |  |                        |            |   |      |   |           |      |  |   |           |  
|Net income                                                     |  | $                      | 170,201    |   |      | $ | 219,992   |      |  | $ | 136,905   |  
|Reconciliation of net income to cash from operating activities |  |                        |            |   |      |   |           |      |  |   |           |  
|Net decrease in derivative assets                              |  |                        | 3,367      |   |      |   | 3,549     |      |  |   | 8,481     |  
|Net decrease/(increase) in interest receivable                 |  |                        | 31,645     |   |      |   | (30,414   | )    |  |   | (1,248    | )
|Net decrease/(increase) in accounts receivable from customer   |  |                        | 48         |   |      |   | (17       | )    |  |   | (105      | )
|Net (decrease)/increase in accrued expenses due to affiliates  |  |                        | (9,788     | ) |      |   | 56,282    |      |  |   | (4,637    | )
|Net decrease in derivative liability to affiliate              |  |                        | (2,533     | ) |      |   | (2,673    | )    |  |   | (6,387    | )
|Net increase/(decrease) in other liabilities                   |  |                        | 26         |   |      |   | 140       |      |  |   | (36       | )
|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  
|Net cash provided by operating activities                      |  |                        | 192,966    |   |      |   | 246,859   |      |  |   | 132,973   |  
|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  
|                                                               |  |                        |           
|Financing Activities                                           |  |                        |            |   |      |   |           |      |  |   |           |  
|Capital distribution to corporation                            |  |                        | (3,770,000 | ) |      |   |          |      |  |   |          |  
|Cash dividend paid                                             |  |                        | (2,646,720 | ) |      |   |          |      |  |   |          |  
|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  
|Net cash used in financing activities                          |  |                        | (6,416,720 | ) |      |   |          |      |  |   |          |  
|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  
|Net (decrease)/increase in cash and cash equivalents           |  |                        | (6,223,754 | ) |      |   | 246,859   |      |  |   | 132,973   |  
|Cash and cash equivalents at beginning of period               |  |                        | 7,383,160  |   |      |   | 7,136,301 |      |  |   | 7,003,328 |  
|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  
|Cash and cash equivalents at end of period                     |  | $                      | 1,159,406  |   |      | $ | 7,383,160 |      |  | $ | 7,136,301 |  
|                                                               |  |                        |            |   |      |   |           |      |  |   |           |  

See accompanying notes to financial statements. The accompanying notes are an integral part of these financial
statements



13



---

Main Place Funding, LLC

Statement of Changes in Members Equity

(Dollars in Thousands)



|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|------------------------------------------- |  | ----------------- | ---------- | - | ------------------- | - | ---------- | ------------------- |  | - | ------------------- | - |  | - | -------
|                                            |  | ContributedEquity |            |   | UndistributedIncome |   |            | TotalMembersEquity |  |   | ComprehensiveIncome
|Balance on December 31, 2004                |  | $                 | 4,770,338  |   |                     | $ | 2,173,414  |                     |  | $ | 6,943,752           |   |  |   |        
|Net income                                  |  |                   |           |   |                     |   | 136,905    |                     |  |   | 136,905             |   |  | $ | 136,905
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Comprehensive income                        |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  | $ | 136,905
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Balance on December 31, 2005                |  | $                 | 4,770,338  |   |                     | $ | 2,310,319  |                     |  | $ | 7,080,657           |   |  |   |        
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Net income                                  |  |                   |           |   |                     |   | 219,992    |                     |  |   | 219,992             |   |  | $ | 219,992
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Comprehensive income                        |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  | $ | 219,992
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Balance on December 31, 2006                |  | $                 | 4,770,338  |   |                     | $ | 2,530,311  |                     |  | $ | 7,300,649           |   |  |   |        
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Net income                                  |  |                   |           |   |                     |   | 170,201    |                     |  |   | 170,201             |   |  | $ | 170,201
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Comprehensive income                        |  |                   |            |   |                     |   |            |                     |  |   |                    |   |  | $ | 170,201
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Equity distribution and Cash dividends paid |  |                   | (3,770,000 | ) |                     |   | (2,646,720 | )                   |  |   | (6,416,720          | ) |  |   |        
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        
|Balance on December 31, 2007                |  | $                 | 1,000,338  |   |                     | $ | 53,792     |                     |  | $ | 1,054,130           |   |  |   |        
|                                            |  |                   |            |   |                     |   |            |                     |  |   |                     |   |  |   |        

See accompanying notes to financial statements. The accompanying notes are an integral part of these financial
statements



14



---

Notes to Financial Statements

Note 1  Description of Business

Main Place Funding, LLC (Main Place), a Delaware limited liability company, is a wholly owned subsidiary of Bank of America, N.A. (the Parent),
which is a wholly owned indirect subsidiary of Bank of America Corporation (the Corporation).

Main Place was established originally as a
Maryland real estate investment trust to consolidate the acquisition, holding and management of certain closed-end residential mortgage loans owned by certain affiliates of the Corporation. In August 2002, Main Place Trust, a Delaware business
trust, was liquidated into the Parent. The Parent holds a 100 percent membership interest in Main Place. Main Place is also considered a single-member LLC under current tax law.

On October 21, 2002, Main Place adopted an Amended and Restated Limited Liability Company Agreement which removed certain restrictions on the business activities of Main Place permitting it to engage in any
activity and to exercise any powers permitted to limited liability companies under the laws of the State of Delaware.

Main Place operates a business of
entering into financial warranty agreements in favor of third parties for a fee. As of December 31, 2007, Main Place was a party to three financial warranty agreements with third-party trusts. These trusts are open-ended diversified, registered
investment companies. Under the terms of these warranty agreements, Main Place provides financial warranties in order to ensure that the trusts are able to redeem all of the outstanding shares of specified series on the warranty maturity dates for
an amount at least equal to an aggregate protected amount. For each of the agreements entered into by Main Place with a third party, Main Place has also entered into a financial warranty agreement with the Parent. Under the terms of these
agreements, the Parent provides financial warranties in favor of Main Place corresponding to Main Places obligations under the financial warranties with the third parties.

Note 2  Summary of Significant Accounting Policies

Basis of Presentation

The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States for annual financial information
and with the instructions to the Form 10-K. The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect reported
amounts and disclosures. Actual results could differ from these estimates. Significant estimates made by management include estimates of fair value of derivative assets and liabilities.

On July 13, 2006, the FASB released FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109 (FIN 48). FIN 48 clarifies the
accounting and reporting for income taxes where interpretation of the tax law may be uncertain. FIN 48 prescribes a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of income tax uncertainties
with respect to positions taken or expected to be taken in income tax returns. Main Place adopted FIN 48 on January 1, 2007. The adoption of FIN 48 had no impact on the Main Places financial condition and results of operations.

Effective January 1, 2007, Main Place adopted Statement of Financial Accounting Standards (SFAS) No. 157, Fair Value Measurements
(SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value under accounting principles generally accepted in the United States (GAAP) and enhances disclosures about fair value measurements. Fair value is defined under
SFAS 157 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the
measurement date. The adoption of SFAS 157 did not have significant impact on Main Places financial condition and results of operation, as the derivative assets and liabilities in Main Place are already recorded at fair value, with changes in
fair value recorded in earnings. For additional information on the fair value of certain financial assets and liabilities, see Note 5 of the Financial Statements.



15



---

Main Place also adopted SFAS 159 on January 1, 2007. SFAS 159 allows an entity the irrevocable option to elect fair
value for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis. SFAS 159 requires that the difference between the carrying value before election of the fair value option and the fair
value of these instruments be recorded as an adjustment to beginning retained earnings in the period of adoption. Main Place did not elect to apply the fair value option to any financial instruments.

Cash and Cash Equivalents

Cash and cash equivalents includes cash on
hand, amounts due from affiliated banks and investments in time deposits with an original maturity of less than 90 days.

Derivatives

All derivatives are recognized on the balance sheet at estimated fair value and changes in fair value are recorded in the statement of income.

Income Taxes

Main Place is classified as a single-member LLC and, as
such, is disregarded as an entity separate from its owners for income tax purposes. The predominant practice for single-member LLCs is to provide for income taxes in their separate financial statements. The accompanying financial statements include
an income tax provision for the years ended December 31, 2007, 2006 and 2005 (see Note 5).

Main Place accounts for income taxes in accordance with
SFAS No. 109, Accounting for Income Taxes (SFAS 109) as interpreted by FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109 (FIN 48), resulting in
two components of income tax expense: current and deferred. Current income tax expense approximates taxes to be paid or refunded for the current period. Deferred income tax expense results from changes in deferred tax assets and liabilities between
periods. These gross deferred tax assets and liabilities represent decreases or increases in taxes expected to be paid in the future because of future reversals of temporary differences in the bases of assets and liabilities as measured by tax laws
and their bases as reported in the financial statements.

Under FIN 48, income tax benefits are recognized and measured based upon a two-step model: 1) a
tax position must be more likely-than-not to be sustained based solely on its technical merits in order to be recognized, and 2) the benefit is measured as the largest dollar amount of that position that is more-likely-than-not to be sustained upon
settlement. The difference between the benefit recognized for a position in accordance with this FIN 48 model and the tax benefit claimed on a tax return is referred to as an unrecognized tax benefit (UTB). The Company accrues income-tax-related
interest and penalties (if applicable) within income tax expense.

Main Places operating results are included in the consolidated federal income tax
return of the Corporation and various state returns of the Corporation and/or affiliates. The method of allocating federal income tax expense is determined under a tax allocation agreement between the Company and the Corporation. This allocation
agreement specifies that income tax expense will be computed for all subsidiaries on a separate company method, taking into account tax planning strategies and the tax position of the consolidated group.

Note 3  Derivatives  Financial Warranty Agreements

Main
Place is in the business of entering into financial warranty agreements with third parties. As of December 31, 2007, Main Place was a party to three financial warranty agreements with third party trusts. The aggregate net asset value of
outstanding shares subject to these financial warranty agreements was $255.8 million and $327.5 million at December 31, 2007 and December 31, 2006, respectively. For each of the agreements entered into by Main Place with a third party,
Main Place has also entered into a financial warranty agreement with the Parent.



16



---

On October 29, 2002, Main Place entered into a financial warranty agreement with Pioneer Principal Protection Trust,
on behalf of its series Pioneer Protected Principal Plus Fund and Pioneer Investment Management, Inc. The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the
terms of the agreement, Main Place provided a financial warranty to the trust in the amount of up to $180.3 million in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in
the financial warranty agreement. The last day upon which the financial warranty may be drawn is January 8, 2010.

On December 20, 2002, Main
Place entered into a financial warranty agreement with the Parent. Under the terms of this agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $180.3 million, corresponding to Main Places
obligations under the financial warranty in favor of Pioneer Principal Protection Trust, on behalf of its series, Pioneer Protected Principal Plus Fund.

On November 1, 2002, Main Place entered into a financial warranty agreement with Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Fundamental Growth Principal Protected Fund and Merrill Lynch Investment
Managers, L.P. The trust is an open-ended diversified, registered investment company registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty in the amount of up to
$265.9 million in order to ensure that the trust is able to redeem all of the outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is
December 1, 2009.

On November 13, 2002, Main Place entered into a financial warranty agreement with the Parent. Under the terms of this
agreement, the Parent provided a financial warranty in favor of Main Place in the amount of up to $265.9 million, corresponding to Main Places obligations under the financial warranty in favor of Merrill Lynch Principal Protected Trust, on
behalf of its series, Merrill Lynch Fundamental Growth Principal Protected Fund.

On November 1, 2002, Main Place also entered into a financial
warranty agreement with Merrill Lynch Principal Protected Trust, on behalf of its series, Merrill Lynch Basic Value Principal Protected Fund and Fund Asset Management, L.P. The trust is an open-ended diversified, registered investment company
registered under the Investment Company Act of 1940, as amended. Under the terms of the agreement, Main Place provided a financial warranty in the amount of up to $335.8 million in order to ensure that the trust is able to redeem all of the
outstanding shares of the series on the maturity date, as defined in the financial warranty agreement. The last day upon which the financial warranty may be drawn is December 1, 2009.

On November 13, 2002, Main Place also entered into a financial warranty agreement with the Parent. Under the terms of this agreement, the Parent provided a
financial warranty in favor of Main Place in the amount of up to $335.8 million, corresponding to Main Places obligations under the financial warranty in favor of Merrill Lynch Principal Protected Trust, on behalf of its series, Merrill Lynch
Basic Value Principal Protected Fund.

Main Place structures these financial warranties to include investment constraints and certain pre-defined triggers
that would require the underlying assets or portfolio of the relevant trust to be liquidated and invested in zero-coupon bonds that mature at a preset future date. Main Place is required to fund any shortfall at the preset future date between the
value of the trusts assets and a preset amount. These financial warranties are booked as derivatives and marked to market in the trading portfolio. Main Place has never made a payment to fund any shortfall amount under these products and
management believes that the probability of such a payment under these financial warranties is remote.

On February 15, 2006, BlackRock,
Inc. & Merrill Lynch agreed to merge their investment management businesses. As part of the merger with BlackRock, the Merrill Lynch Principal Protected Trust Agreements became the BlackRock Principal Protected Trust Agreements on
September 29, 2006 when the merger was completed.

Note 4  Affiliate Transactions

Main Place maintains its cash and cash equivalent accounts with the Parent. Main Place had $971.4 million and $7.1 billion of time deposits placed with the Parent at
December 31, 2007 and 2006, respectively. Interest income on time deposits placed with the Parent for the years ended December 31, 2007, 2006 and 2005 was $255.8 million, $356.0 million and $227.0 million, respectively.



17



---

The Parent pays for substantially all general and administrative expenses incurred by the Company, including but not
limited to compensation and incentive benefits and office overhead. The Parent charged the Company a management fee of $100 thousand in both 2007 and 2006 to reflect the charge for their services and, these amounts are included in other general and
operating expenses.

As described more fully in Note 3, the Parent has entered into financial warranty agreements with Main Place. Under the terms of these
agreements, the Parent provides financial warranties in favor of Main Place, where the maximum obligation under the financial warranties is $782.0 million, which corresponds with Main Places obligations under financial warranty agreements in
favor of third parties.

Accrued expenses due to affiliates at December 31, 2007 and 2006 were $106.6 million and $116.4 million, respectively,
primarily reflecting income taxes due to the Parent.

Note 5  Income Taxes

Main Place adopted the provisions of FIN 48 on January 1, 2007. FIN 48 clarifies the accounting and reporting for income taxes where interpretation of the tax law may be uncertain. At December 31, 2007 and
January 1, 2007 the Company had no unrecognized tax benefits (UTBs). During the year ended December 31, 2007, there were no increases, decreases, settlements or expirations of statutes of limitations affecting the UTB balance.

During 2007, the Internal Revenue Service (IRS) completed the examination phase of the audit of the Corporations federal income tax returns for the
years 2000 through 2002 and issued Revenue Agents Reports (RAR) to the Corporation. Main Place is included in the Corporations federal income tax returns. Included in these RARs were several proposed adjustments that were protested to
the Appeals office of the IRS. The resolution of the proposed adjustments is not expected to impact the Companys UTB balance. However, final determination of the audit or changes in the estimate may result in future income tax expense to the
Company. The Corporations federal income tax returns, which include Main Place, for the years 2003 and 2004 remain under examination by the IRS. Management does not expect these matters to be concluded within the next 12 months. All tax years
subsequent to the above years remain open to examination.

During the year ended December 31, 2007, the Company recognized no interest and penalties
within income tax expense. As of December 31, 2007 and January 1, 2007, the Company had no accrual for interest and penalties that relate to income taxes.

As of December 31, 2007, state tax cushion is released due to overaccural in 2005 and 2006. The components of income tax for the years ended December 31, 2007, 2006 and 2005 are as follows (dollars in
thousands):



|                          |  |      |        |   |      |   |         |  |   |       
|------------------------- |  | ---- | ------ | - | ---- | - | ------- |  | - | ------
|                          |  | 2007 |        |   | 2006 |   | 2005   
|Currentexpense (benefit) |  |      |        |   |      |   |         |  |   |       
|Federal                   |  | $    | 92,169 |   |      | $ | 118,457 |  | $ | 73,718
|State                     |  |      | (7,027 | ) |      |   | 17,186  |  |   | 14,927
|                          |  |      |        |   |      |   |         |  |   |       
|Total income tax expense  |  | $    | 85,142 |   |      | $ | 135,643 |  | $ | 88,645
|                          |  |      |        |   |      |   |         |  |   |       

A reconciliation of the expected federal income tax expense using the federal statutory rate of 35 percent to the
actual income tax expense for the years ended December 31, 2007, 2006 and 2005 is as follows (dollars in thousands):



18



---

|                                             |  |      |        |   |      |   |         |  |   |       
|-------------------------------------------- |  | ---- | ------ | - | ---- | - | ------- |  | - | ------
|                                             |  | 2007 |        |   | 2006 |   | 2005   
|Expected federal tax expense                 |  | $    | 89,370 |   |      | $ | 124,473 |  | $ | 78,942
|Increase (decrease) in taxes resulting from: |  |      |        |   |      |   |         |  |   |       
|State tax expense (benefit), net of federal  |  |      | (4,567 | ) |      |   | 11,170  |  |   | 9,703 
|Other                                        |  |      | 339    |   |      |   |        |  |   |      
|Total income tax expense                     |  | $    | 85,142 |   |      | $ | 135,643 |  | $ | 88,645
|                                             |  |      |        |   |      |   |         |  |   |       

Main Place had no deferred tax assets or liabilities as of December 31, 2007, December 31, 2006 and
December 31, 2005.

Current federal taxes payable to the Corporation, inclusive of current state taxes payable to the Parent, was approximately $106.6
million and $116.4 million and $60.0 million at December 31, 2007, 2006 and 2005, respectively, which are included in accrued expenses due to affiliates on the accompanying balance sheet.

Note 6  Fair Values of Financial Instruments

SFAS 157 defines
fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the
measurement date. SFAS 157 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs
that may be used to measure fair value:



|        |  |                                                                                                                                                                                                                                                                                                       
|------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Level 1 |  | Quoted prices in active markets for identical assets or liabilities.                                                                                                                                                                                                                                  
|        | 
|Level 2 |  | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can
be corroborated by observable market data for substantially the full term of the assets or liabilities.
|        | 
|Level 3 |  | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.                                                                                                                                                       

Main Places derivative assets and liabilities are measured at fair value on a recurring basis using
significant unobservable inputs and are therefore classified as Level 3 measurements. Management calculates the fair value of the derivative assets and liabilities as the present value of the estimated future cash flows to be exchanged under the
financial warranty agreements, including the estimated fees to be received from the funds, as disclosed in Note 3, and paid to the Parent. These fees are calculated based on the net asset value of the aforementioned funds as of December 31,
2007.

The table below presents a reconciliation of changes in fair value of derivative instruments for the period for three and twelve months ended
December 31, 2007.



19



---

Level 3 Fair Value Measurements (Three Months Ended December 31, 2007)



|                                                                                                              |  |                   |       |   |                        |   |        |  
|------------------------------------------------------------------------------------------------------------- |  | ----------------- | ----- | - | ---------------------- | - | ------ | -
|(Dollars in thousands)                                                                                        |  | Derivative Assets |       |   | Derivative Liabilities |  
|Balance, September 30, 2007                                                                                   |  | $                 | 4,717 |   |                        | $ | (3,548 | )
|Total gains or losses (realized/unrealized):                                                                  |  |                   |       |   |                        |   |        |  
|Included in earnings1                                                                                         |  |                   | (379  | ) |                        |   | 285    |  
|Included in other comprehensive income                                                                        |  |                   |      |   |                        |   |       |  
|Purchases, issuances, and settlements                                                                         |  |                   | (543  | ) |                        |   | 409    |  
|Transfers in and/or out of Level 3                                                                            |  |                   |      |   |                        |   |       |  
|                                                                                                              |  |                   |       |   |                        |   |        |  
|Balance, December 31, 2007                                                                                    |  | $                 | 3,794 |   |                        | $ | (2,854 | )
|Changes in unrealized gains or losses relating to assets still held for three months ended December 31, 20071 |  | $                 | (379  | ) |                        | $ | 285    |  
|                                                                                                              |  |                   |       |   |                        |   |        |  



|(1) | Total gains or losses and unrealized gains or losses are
recorded within trading profits.
|--- | -----------------------------------------------------------------------------------------

Level 3 Fair Value Measurements (Twelve Months Ended December 31, 2007)



|                                                                                                               |  |                   |        |   |                        |   |        |  
|-------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------ | - | ---------------------- | - | ------ | -
|(Dollars in thousands)                                                                                         |  | Derivative Assets |        |   | Derivative Liabilities |  
|Balance, January 1, 2007                                                                                       |  | $                 | 7,162  |   |                        | $ | (5,387 | )
|Total gains or losses (realized/unrealized):                                                                   |  |                   |        |   |                        |   |        |  
|Included in earnings1                                                                                          |  |                   | (971   | ) |                        |   | 732    |  
|Included in other comprehensive income                                                                         |  |                   |       |   |                        |   |       |  
|Purchases, issuances, and settlements                                                                          |  |                   | (2,396 | ) |                        |   | 1,801  |  
|Transfers in and/or out of Level 3                                                                             |  |                   |       |   |                        |   |       |  
|                                                                                                               |  |                   |        |   |                        |   |        |  
|Balance, December 31, 2007                                                                                     |  | $                 | 3,794  |   |                        | $ | (2,854 | )
|Changes in unrealized gains or losses relating to assets still held for twelve months ended December 31, 20071 |  | $                 | (971   | ) |                        | $ | 732    |  
|                                                                                                               |  |                   |        |   |                        |   |        |  



|(1) | Total gains or losses and unrealized gains or losses are
recorded within trading profits.
|--- | -----------------------------------------------------------------------------------------

Short-Term Financial Instruments

The carrying value of short-term financial instruments, including cash and cash equivalents, accounts receivable from and accrued expenses due to affiliates and interest receivable approximates the fair value. These
financial instruments generally expose Main Place to limited credit risk, have no stated maturities or have maturities of less than 90 days and carry interest rates, which approximates fair value.

Derivatives

Derivative assets and liabilities are recognized on the
balance sheet at estimated fair value, with changes in fair value recorded in the statement of income. Management calculates the fair value of the financial warranty agreements as the present value of the estimated future cash flows. The estimated
future cash flows are based on the estimated fees to be received from the funds, as disclosed in Note 3, and paid to the Parent. These fees are calculated based on the net asset value of the after mentioned funds at December 31, 2007 and are
netted against the estimated future payout under the warranty contracts, which is estimated to be immaterial at December 31, 2007.



20



---

Main Place Funding, LLC

Form 10-K

Index to Exhibits

Exhibit No. Description

2 (a) Agreement of Merger merging Main Place
Holdings Corporation into Main Place Holdings, LLC, dated as of October 15, 1998. (1)

2 (b) Agreement and Plan of Merger between Main Place Real
Estate Investment Trust and Main Place Funding, LLC, dated as of December 22, 1998. (1)

3 (a) Limited Liability Company Agreement of Main Place
Holdings, LLC, dated as of October 15, 1998. (1)

3 (b) Amended and Restated Limited Liability Company Agreement of Main Place Funding, LLC,
dated as of December 14, 1998. (1)

3 (c) Amended and Restated Limited Liability Company Agreement of Main Place Funding, LLC, dated as of
October 21, 2002. (incorporated by reference from the Report on Form 8-K previously filed on October 21, 2002)

4 (a) Indenture of Trust
dated as of October 31, 1995, between Main Place Funding Corporation and First Trust National Association, pursuant to which Main Place Funding Corporation issued Mortgage-Backed Bonds, Series 1995-2. (incorporated by reference from the Form
8-K previously filed on October 31, 1995)

4 (b) First Supplemental Indenture of Trust dated as of November 1, 1996 to Indenture of Trust
dated as of October 31, 1995 between Main Place Funding Corporation and First Trust National Association, as Trustee. (incorporated by reference from the Form 10-Q previously filed on November 14, 1996)

4 (c) Indenture of Trust dated as of March 18, 1997, between Main Place Funding Corporation and First Trust National Association, as Trustee. (incorporated by
reference from the Form 10-Q previously filed on May 13, 1997)

4 (d) Second Supplemental Indenture of Trust, dated as of December 23, 1998,
between Main Place Funding, LLC and U.S. Bank Trust National Association, as Trustee, in connection with the Indenture of Trust dated as of October 31, 1995. (1)

4 (e) First Supplemental Indenture of Trust, dated as of December 23, 1998, between Main Place Funding, LLC and U.S. Bank Trust National Association, as Trustee, in connection with the Indenture of Trust
dated as of March 18, 1997. (1)

4 (f) Indenture of Trust dated as of May 25, 1999, between Main Place Funding, LLC and U.S. Bank National
Association, as Trustee. (incorporated by reference from the Form 8-K filed on May 25, 1999) 4 (g) Assignment and Assumption Agreement between NationsBank, N.A. and Main Place Trust, dated as of December 14, 1998. (1)

4 (h) Trust Agreement of Main Place Trust, dated as of December 14, 1998. (1)

10 (a) Servicing Agreement dated as of July 18, 1995, between Main Place Funding Corporation and NationsBanc Mortgage Corporation. (incorporated by reference from the Current Report on Form 8-K previously
filed on July 18, 1995)

10 (b) Servicing Agreement dated as of October 31, 1995, between Main Place Funding Corporation and NationsBanc
Mortgage Corporation. (incorporated by reference from the Current Report on Form 8-K previously filed on October 31,1995)



21



---

10 (c) Servicing Agreement dated November 1, 1996, between Main Place Real Estate Investment Trust and
NationsBanc Mortgage Corporation. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed on November 14, 1996)

10
(d) Servicing Agreement dated as of November 1, 1996, between Main Place Real Estate Investment Trust and NationsBank, N.A. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed on November 14, 1996)

10 (e) Servicing Agreement dated as of March 18, 1997, between Main Place Funding Corporation and NationsBanc Mortgage Corporation.
(incorporated by reference from the Quarterly Report on Form 10-Q previously filed on May 13, 1997)

10 (f) Servicing Agreement dated as of
May 25, 1999, by and between Main Place Funding LLC and Nationsbanc Mortgage Corporation. (incorporated by reference from the Form 8-K filed on May 25, 1999)

10 (g) Financial Warranty Agreement by and among Main Place Funding, LLC, Pioneer Investment Management, Inc., and Pioneer Principal Protection Trust on behalf of its series, Pioneer Protected Principal Plus
Fund, dated as of October 29, 2002. (incorporated by reference from the Current Report on Form 8-K previously filed and dated as of October 21, 2002)

10 (h) Financial Warranty Agreement by and between Main Place Funding, LLC and Bank of America, N.A., dated as of November 13, 2002. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed on
November 14, 2002)

10 (i) Financial Warranty Agreement by and among Main Place Funding, LLC, Merrill Lynch Principal Protected Trust, on behalf
of its series Merrill Lynch Fundamental Growth Principal Protected Fund and Merrill Lynch Investment Managers, L.P., dated as of November 1, 2002. (incorporated by reference from the Current Report on Form 8-K previously filed and dated as of
October 21, 2002)

10 (j) Financial Warranty Agreement by and between Main Place Funding, LLC and Bank of America, N.A., dated as of
November 13, 2002. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed on November 14, 2002)

10
(k) Financial Warranty Agreement by and among Main Place Funding, LLC, Merrill Lynch Principal Protected Trust, on behalf of its series Merrill Lynch Basic Value Principal Protected Fund and Fund Asset Management, L.P., dated as of
November 1, 2002. (incorporated by reference from the Current Report on Form 8-K previously filed and dated as of October 21, 2002)

10
(l) Financial Warranty Agreement by and between Main Place Funding, LLC and Bank of America, N.A., dated as of November 13, 2002. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed on November, 14 2002)

10 (m) Financial Warranty Agreement by and among Main Place Funding, LLC, Oppenheimer Principal Protected Trust II, on behalf of its series
Oppenheimer Principal Protected Main Street Fund II and OppenheimerFund, Inc., dated as of October 31, 2003. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed and dated as of November 14, 2003)

10 (n) Financial Warranty Agreement by and between Main Place Funding, LLC and Bank of America, N.A., dated as of October 31, 2003. (incorporated by
reference from the Quarterly Report on Form 10-Q previously filed and dated as of November 14, 2003)

10 (o) Financial Warranty Agreement by and
between Main Place Funding, LLC and Bank of America, N.A., dated as of November 13, 2002. (incorporated by reference from the Quarterly Report on Form 10-Q previously filed on November, 14 2002)



22



---

10 (p) Termination agreement was entered into among Main Place Funding LLC, Bank of America, N.A., a national
banking association, OppenheimerFunds, Inc and Oppenheimer Principal Protected Trust II on behalf of its series, Oppenheimer Principal Protected Main Street Fund II, dated January 20, 2004. (incorporated by reference from the Current Report on
Form 8-K previously filed and dated as of January 27, 2004)

10 (q) Termination agreement was entered into among Main Place Funding LLC and Bank
of America, N.A., dated January 20, 2004 (incorporated by reference from the Current Report on Form 8-K previously filed and dated as of January 27, 2004)



|23 | Consent of PricewaterhouseCoopers LLP
|-- | -------------------------------------



|31.1 | Certification of President pursuant to Section 302 of The Sarbanes-Oxley Act of 2002
|---- | ------------------------------------------------------------------------------------



|31.2 | Certification of Principal Financial and Accounting Officer pursuant to Section 302 of The Sarbanes-Oxley Act of 2002
|---- | ---------------------------------------------------------------------------------------------------------------------



|32.1 | Certification of President pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of The Sarbanes-Oxley Act of 2002
|---- | -----------------------------------------------------------------------------------------------------------------------------------



|32.2 | Certification of Principal Financial and Accounting Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of The Sarbanes-Oxley Act of 2002
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------



|(1) | Incorporated by reference from the Form 10-K previously filed on April 1, 2002
|--- | ------------------------------------------------------------------------------



23