Document:

ex10-74.htm

     

    
      

      

    

    

    LICENSE
      AND SUPPLY AGREEMENT

    

    

    THIS
      AGREEMENT is made on September 27, 2007, between

    

    Columbia
      Laboratories, Inc. (“Columbia”), a company incorporated under the laws of the
      state of Delaware, with offices at 354 Eisenhower Parkway, Livingston,

    New Jersey 07039;
      and

    

    Ascend
      Therapeutics, Inc.(“Ascend”), a company
      incorporated under the laws of the state of Virginia, with offices at 607
      Herndon Parkway, Suite 210, Herndon, Virginia 20170.

    

                   
      RECITALS:

    

    Whereas,
      Columbia possesses certain proprietary bioadhesive drug delivery technology
      as
      well as proprietary know-how and confidential information used or useful in
      the

    manufacture
      and use of bioadhesive drug products and is the owner or has licensed or has
      control of and is beneficially entitled to a number of patents that have been
      granted 

    or
      are
      pending in relation to the development and production of such products;
      and

    

    Whereas,
      Columbia possesses, or controls and directs, the requisite expertise, personnel
      and facilities for the formulation, development and supply of Product (as
      defined 

    below)
      utilizing the Columbia Technology (as defined below); and

    

    Whereas,
      Ascend wishes to have Columbia supply Product to Ascend for commercial sale,
      and
      for clinical studies required to obtain regulatory approvals necessary for
      

    Indications
      (as defined below); and

    

    Whereas,
      Columbia and Ascend both desire to enter into an agreement to give effect to
      the
      arrangements described herein,

    

    Now
      Therefore, in consideration of the premises, which are incorporated herein
      by
      reference, and other good and valuable consideration, the receipt and adequacy
      of which is 

    hereby
      acknowledged, the Parties hereto agree as follows:

    

    
      	
               

            	
              SECTION
                1 - DEFINITIONS

            

    

    

    
      	
              1.1

            	
              In
                this Agreement, unless the context otherwise
                requires:

            

    

    

     “Affiliate”
      means any corporation or entity controlling, controlled by, or under common
      control with Columbia or Ascend, as the case may be.  For the purposes
      of this Agreement, “control” (including "controlling", "controlled by" and
      "under common control with") of any Party, corporation or other business entity
      shall mean the direct or indirect beneficial ownership of more than fifty
      percent (50%) of the voting stock of, or more than a fifty percent (50%)
      interest in the income of, such corporation or other business entity, or such
      other direct or indirect interest or relationship as in fact constitutes actual
      control.

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            1 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    “Adverse
      Drug Experience” means any “adverse drug experience” as defined or contemplated
      by 21 C.F.R. 314.80 or 312.32, associated with the Product.

    

    “Adverse
      Drug Experience Report” means any oral, written or electronic report of any
      Adverse Drug Experience transmitted to any Party.

    

    “Ascend”
      means Ascend Therapeutics, Inc., and any of its Affiliates.

    

    “Columbia”
      means Columbia Laboratories, Inc., and any of its Affiliates.

    

     “Columbia
      Know-How” means all knowledge, information, trade secrets, data (including all
      clinical data) and expertise associated with Columbia's bioadhesive drug
      delivery technology that is not generally known to the public, owned or licensed
      by Columbia or to be developed or licensed by Columbia
      before or during the Term, whether or not covered by any patent, copyright,
      design, trademark or other industrial or intellectual property
      rights.

    

    “Columbia
      Patents” means any and all patents and patent applications as set forth in
      Exhibit A, and all rights therein, and including all extensions, continuations,
      continuations-in-part, divisionals, patents-of-additions, re-examinations,
      re-issues, supplementary protection certificates and foreign counterparts
      thereto owned by Columbia, or licensed to Columbia and associated with
      Columbia's bioadhesive drug delivery technology.

    

    “Columbia
      Technology” means the Columbia Know-How and Columbia Patents.

    

    "Commercially
      Reasonable" means with respect to a Party, and with respect to a Product,
      efforts and resources that are comparable to those generally used by a company
      in the pharmaceutical industry in the exercise of its reasonable business
      judgment relating to other prescription pharmaceutical products owned or
      licensed by it or to which it has exclusive rights, which have market potential
      and are at a stage of development or product life similar to the Product, taking
      into account measures of relative safety and efficacy, Product profile, the
      competitiveness of the marketplace, the proprietary position of the Product,
      the
      regulatory structure involved, the relative profitability of the Product, and
      other relevant factors, including without limitation comparative technical,
      legal, scientific, and/or medical factors.

    

    “Contract
      Year” means a period beginning on the Effective Date and each anniversary of the
      Effective Date and continuing up to the subsequent anniversary of the Effective
      Date.

    

    “Current
      Good Manufacturing Practice” or “cGMP” means manufacture in accordance with 21
      CFR Parts 210 and 211; as they may be amended from time to time.

    

    “DDMAC”
      means the FDA’s Division of Drug Marketing, Advertising and
      Communications.

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            2 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    “Effective
      Date” means January 1, 2008.

    

    “FDA”
      means the United States Food and Drug Administration.

    

    "Finished
      Package Form" means six (6) Product applicators individually wrapped in foil
      with required leaflet printed in one color and inserted into an appropriate
      box
      with customary trade dress printed in up to four colors.  The boxes
      will be placed into appropriate outer cartons (of twelve (12) boxes) which
      will
      be printed in one color with required labeling and UPC codes.

    

    “Indication”
      means any gynecological indication that the Product now has or may have in
      the
      future, including without limitation amenorrhea and endometrial protection,
      provided, however, that Indication shall not include uses relating to fertility,
      pregnancy, or preterm birth.

    

    “Joint
      Steering Committee” has the meaning set forth in Section 4.

    

    “Minimum
      Purchase Obligations” means Ascend’s obligations to purchase Product set forth
      on Exhibit B hereto for each period specified therein.

    

    “NDA”
      means a New Drug Application as such term is defined in 21 CFR Part
      314.

    

    “Net
      Selling Price” means, in the case of Product sold by Ascend or a sub-licensee,
      that sum determined by deducting from the aggregate gross sales proceeds billed
      for Product by Ascend or a sub-licensee, as the case may be, all as determined
      in accordance with generally accepted accounting principles on a basis
      consistent with Ascend’s audited financial statements, a maximum aggregate
      deduction of [***] to cover the following:

    

    
      	
               

            	
              (a)

            	
              customs
                duties, sales or use taxes, or other taxes (excluding income or
                corporation tax), directly related to the sale of Product which are
                paid
                by Ascend or its sub-licensees, as the case may
                be;

            

    

    

    
      	
               

            	
              (b)

            	
              a
                discount from the gross sales proceeds to cover such normal costs
                as are
                incurred by Ascend  or its sub-licensees, as the case may be, in
                respect of transport, shipping, and insurance, to the extent specifically
                referenced in the invoice and included in the invoice
                price;

            

    

    

    
      	
               

            	
              (c)

            	
              customary
                trade, quantity and cash discounts, chargebacks, deductions, and
                rebates
                directly related to the sale of Product and actually allowed and
                taken;

            

    

    

    
      	
               

            	
              (d)

            	
              amounts
                repaid or credited by reasons of rejections or return of goods, or
                because
                of retroactive price reductions specifically identifiable to the
                Product;
                and

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            3 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    
      	
              (e) 
                 

            	
              amounts
                payable resulting from governmental (or agency thereof) mandated
                rebate
                programs and other third-party rebates to the extent actually
                allowed.

            

    

    

    Provided,
      however, that in the event Ascend shall sell Product together with other
      products of Ascend to third parties (by the method commonly known in the
      pharmaceutical industry as "bundling") and the price attributable to Product
      is
      less than the average price of "arms length" sales to similar customers for
      the
      reporting period in which sales occur (such bundled sales to be excluded from
      the calculation of the average price of "arms length" sales), gross sales
      proceeds for any such sales shall be the average price of "arms length" sales
      by
      Ascend or a sublicensee to similar customers during the reporting period in
      which such sales occur.

    

    "Party"
      or “Parties” means Ascend or Columbia, or both, as the case may be.

    

    “PDMA”
      means the Prescription Drug Marketing Act, as amended, and the rules and
      regulations promulgated thereunder.

    

    “Phase
      IV
      Clinical Study” means any post-marketing human clinical trial to confirm with
      statistical significance the safety and efficacy of the Product, whether
      initiated by a Party or at the request of the FDA, to delineate additional
      information about a drug’s risks, benefits, and optimal use, including, without
      limitation, safety surveillance studies, pharmacoeconomic studies,
      pharmacoepidemiology studies, studies relating to different dosing or schedules
      of administration, studies of the use of the drug in other patient populations
      or other stages of a disease or condition or for indications including (but
      not
      limited to) for the treatment of hyperplasia or hormone replacement therapy,
      or
      studies of the use of the drug over a longer period of time.

    

    “Phase
      IV
      Clinical Study Costs” shall mean all direct and indirect expenses and other
      costs incurred by or on behalf of a Party in connection with a Phase IV Clinical
      Study, including, without limitation, the costs of clinical studies, the
      preparation, collation and/or validation of data from such clinical studies
      and
      the preparation of medical writing and publishing.  Without limitation
      of the foregoing, Phase IV Clinical Study Costs shall
      include:  (a) all reasonable out-of-pocket costs incurred by a
      Party or its Affiliates, including payments made to Third Parties, with respect
      to any of the foregoing; (b) the direct and indirect costs of scientific,
      medical or technical personnel (including personnel expense, reasonable travel
      expenses and infrastructure costs but not including the costs of managerial,
      financial or legal personnel) engaged in such efforts; (c) the costs of
      clinical supply and related disposal; (d) the costs of preparing and
      submitting applications for FDA approvals; and (e) the acquisition costs of
      the Product.

    

    
      	
               

            	
               “Product”
                means the 4% w/w progesterone gel (45 mg) in single use, one piece,
                disposable vaginal applicators containing 1.45 g of gel and delivering
                1.125 g of gel, utilizing the Columbia Technology, and approved by
                the FDA
                under NDA 20-701.

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            4 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    “Product
      Complaint” means any report concerning the quality, purity, quantity, weight,
      pharmacologic activity, labeling or appearance of the Product.

    

    “Serious
      Adverse Drug Experience” means any Adverse Drug Experience that is fatal or
      life-threatening, requires hospitalization or prolongation of existing
      hospitalization, results in persistent or significant disability or incapacity,
      is a congenital anomaly/birth defect, or is of comparable medical significance
      or any other event which would constitute a “serious” Adverse Drug Experience
      pursuant to the terms of 21 C.F.R. 314.80 or 312.32.

    

    “Serious
      Adverse Drug Experience Report” means any Adverse Drug Experience Report that
      involves a Serious Adverse Drug Experience.

     

    “Trademark”
      means Prochieve® 4% and any other mark selected by the Parties for use with the
      Product.

    

     “Territory”
      means the United States, its territories and possessions.

    

    SECTION
      2 – LICENSE

    

    2.1           License

    

    
      	
            	 2.1.1	
              Columbia
                hereby grants to Ascend an exclusive license (even as to Columbia)
                in the
                Territory under the Columbia Technology to the extent it relates
                exclusively to the Product, and not to any other product or active
                component, to import, market, promote, use, distribute, offer to
                sell, and
                sell the Product in the Territory, but for the avoidance of doubt
                no
                rights are granted hereunder for Ascend to manufacture the
                Product.

            

    

    

    
      	
               

            	 2.1.2	
              Columbia
                hereby grants to Ascend a non-exclusive license under Columbia Technology
                that is not associated exclusively with the Product but that, in
                the
                absence of the license provided in this Section 2.1.2, would
                necessarily be infringed by Ascend's practice of the license granted
                in
                Section 2.1.1.  This non-exclusive license shall apply only to
                the extent necessary for Ascend to exercise its rights and discharge
                its
                obligations under this Agreement with respect to the
                Product.

            

    

    

    
      	
               

            	 2.1.3	
              Ascend
                shall have the right to grant sublicenses under the rights and licenses
                granted to it in this Article 2, provided that, any such sublicense
                shall be approved by Columbia, said approval not being unreasonably
                withheld, conditioned or delayed, and shall obligate the sublicensee
                to
                comply with all relevant terms of this Agreement and Ascend remains
                liable
                to Columbia for all material acts and omissions of any such
                sublicensee.

            

    

     

    
      	
               

            	 2.1.4	
              Except
                as specifically set forth in this Agreement, neither Party shall
                acquire
                any license or other intellectual property interest, by implication
                or
                otherwise, in any

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            5 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

     

    
      	
               

            	
               information
                disclosed to it under this Agreement or under any patents or patent
                applications owned or controlled by the other Party or its
                Affiliates.

            

    

     

    

    
      	
              2.2

            	 	
              Except
                as otherwise expressly provided herein, nothing in this Agreement
                shall,
                during or after the Term hereof, grant Ascend any of Columbia’s rights in
                or related to the Product, including, but not limited to, Columbia’s
                rights in or to trademarks, copyrights, the Product’s NDA, Drug Master
                Files, patent or other intellectual property rights, preclinical
                or
                clinical data, manufacturing rights relating to the Product, or any
                supply
                of the Product or the active ingredient thereof.  For the
                avoidance of doubt, no rights are granted to Ascend hereunder with
                respect
                to the Product or the manufacture, use, promotion, marketing or sale
                thereof outside the Territory.

            

    

    

    
      	
              SECTION
                3 - INTELLECTUAL PROPERTY

            	
            

    

    

    
      	
              3.1

            	
              Ownership
                of Intellectual
                Property

            

    

    

    
      	
               

            	 3.1.1	
              Columbia
                shall remain the sole owner of all Columbia
                Technology.

            

    

    

    
      	
               

            	 3.1.2	
              Columbia
                shall be entitled to use the Columbia Technology in connection with
                Columbia’s commercial arrangements otherwise than in relation to the
                Product in the Territory, and in connection with the Product following
                termination of this Agreement.

            

    

    

    
      	
              3.2

            	
              Each
                Party shall promptly notify the other if it becomes aware of any
                claim or
                threatened or likely claim that the Product or the development,
                manufacture, importation, marketing, use or sale thereof infringes
                a
                patent or other intellectual property right of any third
                party.  In the event of such an infringement claim or potential
                claim, the Parties shall discuss in good faith the actions, if any,
                to be
                taken; provided that in no event shall either Party be obligated
                to
                continue manufacture, importing, marketing, sale and distribution
                of the
                Product if it reasonably believes that such action would constitute
                infringement of a third party's intellectual property
                rights.

            

    

    

    
      	
              3.3

            	
              Enforcement

            

    

    

    
      	
               

            	
              3.3.1    

            	
              Ascend
                and Columbia shall promptly inform the other in writing of any alleged
                infringement of which it shall become aware by a third party of any
                patents within the Columbia Technology and Ascend shall provide Columbia
                with any available evidence of
                infringement.

            

    

    

    
      	
               

            	
              3.3.2    
                

            	
              Columbia,
                at its option, shall be entitled to institute or have instituted
                any
                administrative, judicial or other proceeding ("Enforcement Proceedings")
                to prevent or stop any infringement or unauthorized use of the Columbia
                Technology at its own expense and for its own benefit. Ascend agrees
                to
                provide all reasonable co-operation and assistance to Columbia in
                relation
                to any such Enforcement Proceedings and agrees to be named as a party
                in
                any Enforcement

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            6 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

    

    Proceedings,
      as necessary, that may be instituted hereunder.  Columbia shall
      reimburse Ascend its reasonable costs and expense for such
      cooperation.

    

    
      	
               

            	
              3.3.3    
                

            	
              In
                the event that Columbia does not institute or have instituted Enforcement
                Proceedings relating to Columbia Patents, then Ascend may enforce
                such
                rights at its own expense.  Columbia shall cooperate with Ascend
                and provide all reasonable assistance in relation to any such Enforcement
                Proceedings and agrees to be named as a party in any
                Enforcement Proceedings, as necessary, instituted by Ascend
                hereunder.  Ascend  shall seek written approval from
                Columbia, which may not be unreasonably withheld or delayed, prior
                to
                taking action and shall keep Columbia informed of the action and
                may not
                enter into any settlement agreement without Columbia’s consent, which may
                not be unreasonably withheld or delayed.  Any reasonable fees
                and costs borne by Columbia shall be reimbursed by Ascend.  In
                the event that Ascend decides to enforce the Columbia Patents in
                accordance with this paragraph, any recovery remaining after the
                deduction
                of reasonable expenses (including attorneys' fees and expenses) incurred
                in relation to such Enforcement Proceedings shall be
                shared equally between the Parties.

            

    

    

    
      	
              3.4

            	
              Defense

            

    

    

    
      	
               

            	
              3.4.1    
                

            	
              In
                the event that a claim or proceeding is threatened or brought against
                a
                Party by a third party alleging that the manufacture, sale, use or
                offer
                for sale of Product infringes the patent or other intellectual property
                rights of that or any other third party in the Territory (“IP Claim”),
                that Party shall promptly advise the other Party of such IP Claim
                and the
                Parties shall meet to discuss the manner in which such IP Claim should
                be
                defended.

            

    

    

    
      	
               

            	
              3.4.2    
                

            	
              Neither
                Party shall acknowledge to the third party or to any other person
                the
                validity of any IP Claim of such a third party, and shall not compromise
                or settle any IP Claim relating thereto without the prior written
                consent
                of the other Party, such consent not to be unreasonably withheld
                or
                delayed.  Ascend shall be responsible for the conduct of the
                proceedings in defending any IP Claim, with counsel acceptable to
                Columbia.  Ascend shall keep Columbia advised of all material
                developments in said proceedings.

            

    

    

    
      	
              3.4.3    
                

            	
              Ascend
                shall indemnify Columbia and its Affiliates against any and all actions,
                losses, claims, demands, damages, costs and liabilities (including
                reasonable attorneys’ fees) due to any IP Claim, except to the extent that
                (i) use of the Columbia Technology as contemplated by this Agreement
                necessarily infringes third party patent rights or (ii) the Product
                necessarily infringes third party intellectual property rights by
                reason
                of the Columbia Technology.

            

    

    

    
      	
              3.4.4    

            	
              In
                accordance with their obligations pursuant to this Agreement, the
                Parties
                shall take such action as is reasonable, such as to cease selling
                the
                Product, or to re-engineer or modify the Product so as to avoid infringing
                the patent rights of a

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            7 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    third
      party, or entering into a license agreement with such third party after due
      consideration of each of the Party’s interests in the matter.

    

    
      	
              3.4.5    
                

            	
              Neither
                Party shall have any liability to the other Party whatsoever or howsoever
                arising for any losses incurred as a result of Ascend having to cease
                selling the Product as a result of an IP
                Claim, except that if such an IP
                Claim arises due to (i) use of the Columbia Technology as contemplated
                by
                this Agreement necessarily infringes third party patent rights or
                (ii) the
                Product necessarily infringes third party intellectual property rights
                by
                reason of the Columbia Technology, Columbia shall repay to Ascend
                the
                purchase price of any Product purchased and in Ascend’s then current
                inventory that can no longer be sold, including reasonable, documented,
                direct, out-of-pocket costs incurred for transportation and/or destruction
                of said Product. Columbia shall have no liability to Ascend for any
                enhanced or punitive damages awarded as a result of any willful patent
                infringement, unless such damages are the direct result of Columbia’s
                breach of this Agreement.

            

    

    

    
      	
              3.5

            	
              Trademarks

            

    

     

    

     

    
      	
              3.5.1    
                

            	
              Should
                the Parties agree to use a trademark other than Prochieve® 4% for the
                Product, Columbia shall register the trademark in its name with respect
                to
                the Product.

            

    

     

    
      	
              3.5.2    
                

            	
              Columbia
                hereby grants to Ascend a non-assignable, non-sublicensable,
                non-exclusive, royalty-free right and license to use the Trademark
                in the
                Territory solely in connection with Ascend’s promotion of the Product in
                accordance with this Agreement. Such license shall expire immediately
                upon
                the expiration or termination of this Agreement. Ascend recognizes
                Columbia’s title to the Trademark, and shall not at any time, during or
                after the Term, do or knowingly suffer to be done any act or thing
                which
                will in any way impair the rights of Columbia in or to the
                Trademark.  Ascend acknowledges and agrees that it shall not
                acquire and shall not claim any title to the Trademark adverse to
                Columbia
                by virtue of the rights granted under this Agreement or through Ascend’s
                use of the Trademark, it being the intention of the parties that
                all
                goodwill and improved reputation generated by Ascend and use of the
                Trademark shall inure to the benefit of
                Columbia.

            

    

     

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            8 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
              SECTION
                4 - JOINT STEERING COMMITTEE

            	
               

            

    

    

    
      	
              4.1

            	
              The
                Parties recognize that cooperation will be required from each Party
                to
                successfully commercialize the Product, and for this purpose, the
                Parties
                will establish a Joint Steering
                Committee.

            

    

    

    
      	
              4.2

            	
              The
                Joint Steering Committee shall consist of a chief representative
                from each
                Party together with such additional personnel, consultants or
                sub-contractors, from each Party who are appropriately skilled and
                knowledgeable in relation to the Product. A Party may change any
                of its
                representatives at any time if a new person (with appropriate expertise
                to
                replace the outgoing member) is appointed by giving written notice
                to the
                other Party.  The total number of members may be changed by
                unanimous vote of the Joint Steering Committee from time to time
                as
                appropriate; provided, that the Joint Steering Committee shall in
                all
                cases be comprised of an equal number of members from each of Columbia
                and
                Ascend.  One representative from Ascend shall serve as Chairman
                of the Joint Steering Committee.  The members appointed to the
                Joint Steering Committee by each Party shall be vested with appropriate
                decision-making authority and power by such
                Party.

            

    

    

    
      	
              4.3

            	
              Unless
                otherwise agreed by the Parties, the Joint Steering Committee shall
                meet
                at least once each calendar quarter.  The first meeting of the
                Joint Steering Committee shall be held in December 2007.  The
                Joint Steering Committee may meet in person or by means of such telephone,
                video or other communication facilities as permit all members of
                the Joint
                Steering Committee to communicate with each other simultaneously
                and
                instantaneously, provided, however, that the Joint Steering Committee
                shall meet at least once per year in person and such meetings shall
                be
                held at the offices of Columbia, or as otherwise agreed by the
                Parties.  Meetings shall be co-chaired by the chief
                representatives of the Parties.  Subject to Section 4.4,
                decisions shall be made unanimously, each Party having one (1) vote
                regardless of the number of representatives present or voting; provided,
                that no such vote shall be valid unless each party is represented
                by at
                least one member either by written proxy or actual presence at the
                meeting
                at which the vote is taken. At and between meetings of the Joint
                Steering
                Committee, each Party shall keep the other fully and regularly informed
                as
                to its progress with its respective
                obligations.

            

    

    

    
      	
              4.4

            	
              In
                the event of a dispute within the Joint Steering Committee that cannot
                be
                resolved by consensus, such dispute shall be referred to the Presidents
                of
                Ascend and Columbia who shall discuss the matter and attempt to reach
                an
                amicable solution.  The provisions of this Section 4.4 shall be
                without prejudice to the Parties’ other rights and
                remedies.

            

    

    

    
      	
              4.5

            	
              The
                Joint Steering Committee shall not have the authority to amend, modify
                or
                waive any of the terms or conditions of this
                Agreement.

            

    

    

    
      	
              4.6

            	
              The
                responsibilities of the Joint Steering Committee shall be exercised
                consistent with this Agreement and shall include, but shall not be
                limited
                to:

            

    

    

    
      	
              4.6.1   
                

            	
              reviewing
                and approving the marketing plan prior to the beginning of
                each

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            9 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              calendar
                year, including matters relating to managed markets, distribution
                and
                trade pipeline;

            

    

    
      	
              4.6.2 
                   

            	
              monitoring
                and reviewing compliance with the marketing plan and, in connection
                therewith, reviewing and approving any material change
                thereto;

            

    

    
      	
              4.6.3    
                

            	
              reviewing,
                coordinating and directing all development activities for the Product,
                including matters concerning Product labeling and Phase IV Clinical
                Study;

            

    

    
      	
              4.6.4    
                

            	
              reviewing
                and approving protocols to be used in any Phase IV Clinical Study
                with
                respect to the Product;

            

    

    
      	
              4.6.5  
                  

            	
              reviewing
                and discussing manufacturing and regulatory status updates provided
                by
                Columbia to the Joint Steering
                Committee;

            

    

    
      	
              4.6.6 
                   

            	
              reviewing
                pricing for the Product, including the timing of any pricing changes;
                provided that any price increase is subject to Columbia approval
                in its
                sole discretion and in no event shall the wholesale acquisition cost
                for
                the Product be less than $38.89 per Finished Dosage Form without
                the prior
                written consent of Columbia in its sole discretion;
                and

            

    

    
      	
              4.6.7  
                  

            	
              such
                other functions as may be mutually agreed upon by the parties from
                time to
                time.

            

    

    

    
      	
              4.7  

            	
              For
                the avoidance of doubt, any decisions of the Joint Steering Committee
                with
                respect to matters that require FDA approval or otherwise relate
                to
                regulatory compliance of the Product shall require Columbia’s prior
                written consent.

            

    

    

    
      	
              4.8  

            	
              The
                Joint Steering Committee shall have responsibility for and shall
                make all
                decisions with respect to any recall, market withdrawal or any other
                corrective action related to the Product.  In the interest of
                clarity, the power of the Joint Steering Committee with respect to
                the
                foregoing is limited to (i) the ability to sanction, but not to mandate
                a
                recall by Ascend, and (ii) vetoing a suggestion by either
                Party.  At Ascend’s request and expense, Columbia shall provide
                assistance to Ascend in conducting such recall, market withdrawal
                or other
                corrective action. Columbia shall be under no liability whatsoever
                to
                compensate Ascend or make any other payment to Ascend for any decision
                to
                recall, initiate a market withdrawal or take any other corrective
                action
                with respect to the Product, except in the case of a recall or market
                withdrawal caused solely by the negligence or willful malfeasance
                of
                Columbia, its Affiliates or subcontractors, or by the breach by Columbia
                of its representations and warranties in this Agreement, in which
                case
                Columbia shall replace Product returned and reimburse
                Ascend for
                its reasonable, documented, direct, out-of-pocket costs in
                connection with such recall, market withdrawal or other corrective
                action
                provided that Ascend shall not be in material breach of its obligations
                hereunder and
                Columbia’s liability to reimburse Ascend hereunder shall not exceed
                [***].

            

    

    

    
      	
              SECTION
                5 - ASCEND OBLIGATIONS

            	
               

            

    

    

    
      	
              5.1  

            	
              Ascend
                shall, at its sole expense, warehouse and distribute the Product,
                and may
                at its sole discretion negotiate and enter into accounts with managed
                market entities and institutional customers (e.g., pharmacy benefit
                managers, health plans, long term care pharmacy providers, employers,
                the
                United States Government and state and local governments, including
                Medicare), and otherwise ensure that the Product is
                freely

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            10 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    distributed
      in all trade channels and not subject to unusual restraints or conditions to
      access as compared to similar products. 

    

    
      	
              5.2  

            	
              Ascend
                shall be responsible for:

            

    

    

    
      	
              5.2.1  

            	
              all
                direct and indirect costs incurred by Ascend for its sales force
                in
                connection with marketing and selling the Product including (without
                limitation) sales representative training, sample accountability,
                sales
                force automation and sales operations
                support;

            

    

    
      	
              5.2.2  

            	
              having
                a marketing presence in at least two national-level meetings per
                year;
                and

            

    

    
      	
              5.2.3  

            	
              exploring
                the possibility of re-branding the Product for gynecological indications
                and exploring regulatory options for expanding gynecological indications
                for the Product.

            

    

    

    
      	
              5.3

            	
              Ascend
                shall, at its sole expense, use Commercially Reasonable efforts to
                promote
                the Product and endeavor to persuade health care professionals to
                prescribe, and patients to use, the Product.  All statements,
                core selling messages and materials to be utilized by Ascend to promote
                the Product shall be subject to the prior approval of Columbia in
                accordance with Section 5.8 below.  Ascend will cause its
                sales force and Ascend employees and agents acting on Ascend’s behalf to
                comply with this Agreement and all applicable legal requirements
                in
                connection with the promotion of the Product, including,
                without limitation, the FDA’s regulations and guidelines concerning the
                advertising of prescription drug products, DDMAC’s promotional guidelines,
                the American Medical Association’s Guidelines on Gifts to Physicians, the
                Pharmaceutical Research and Manufacturers of America Guidelines for
                Marketing Practices, the Prescription Drug Marketing Act of 1987,
                as
                amended, and the rules and regulations promulgated thereunder, and
                the
                Accreditation Council for Continuing Medical Education Standards
                for
                Commercial Support of Continuing Medical Education, which may be
                applicable to the activities (including, without limitation, the
                warehousing, handling and distribution of Samples) to be performed
                by
                Ascend hereunder.  It is understood, and Ascend agrees, that it
                will be accountable for the acts or omissions of the sales force
                and its
                employees and agents to the extent such acts or omissions fail to
                comply
                with Ascend’s obligations under this
                Agreement.

            

    

    

    
      	
              5.4  

            	
              Ascend
                will not make any false or misleading representations to health care
                professionals, customers or others regarding Columbia or the Product
                and
                will not make any representations, warranties or guarantees with
                respect
                to the specifications, features or capabilities of the Product that
                are
                not consistent with the applicable current FDA approved labeling,
                package
                insert or other documentation accompanying or describing the Product,
                including Columbia’s limited warranty and disclaimers.  Ascend
                shall not make any negative statements about any other Columbia products
                in an effort to promote the
                Product.

            

    

    

    
      	
              5.5

            	
              To
                the extent requested by Ascend, Columbia shall deliver to Ascend
                all
                training materials for the Product in its possession on the date
                hereof
                less a reasonable amount

            

    

     

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            11 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    thereof
      for archival purposes.  Ascend shall, at its own expense, develop
      training materials for its sales representatives in other media or forms
      provided that such materials shall be subject to Columbia’s review as
      promotional materials as provided in Section 5.8.  Ascend shall,
      at its own expense, train its sales representatives using such training
      materials, the other promotional materials and such programs as Ascend shall
      deem appropriate that are in compliance with Ascend’s obligations hereunder and
      all other legal requirements.  Such programs shall include training
      with respect to reporting Adverse Drug Experiences and Product Complaints.
      None
      of Ascend, the sales force and Ascend’s employees and agents shall offer, pay,
      solicit or receive any remuneration to or from healthcare professionals in
      order
      to induce referrals of or purchase of the Product.  The sales force
      shall have no direct contact with, nor shall the sales force be involved with
      the delivery of Product to patients, other than delivery of Samples directly
      to
      healthcare professionals authorized to prescribe the Product.  The
      sales force shall be trained in connection with compliance with
      Sec. 1128B(b) of the Social Security Act and the AMA Guidelines on Gifts to
      Physicians from Industry prior to engaging in promotion of the
      Product.

     

    
      	
              5.6

            	
              Columbia
                will have no obligation to train Ascend’s sales force.  Ascend
                may request Columbia’s assistance in the initial training and additional
                training on new developments in connection with the
                Product.  Any such request shall be made with reasonable notice
                to Columbia and shall be at Ascend’s expense for Columbia’s out-of-pocket
                costs.

            

    

    

    
      	
              5.7

            	
              Ascend
                shall at its sole expense, create, develop, produce or otherwise
                obtain,
                and utilize promotional, marketing, educational and training materials
                that are necessary to support fully the promotional effort for the
                Product.  Such promotional materials may include, by way of
                example, detailing aids; leave behind items; journal advertising;
                educational programs; formulary binders; appropriate reprints and
                reprint
                carriers; product monographs; patient support kits; materials to
                support
                the handling of physician requests; convention exhibit materials;
                direct
                mail; market research survey and analysis; training materials; and
                scripts
                for telemarketing and
                teleconferences.

            

    

    

    
      	
              5.8

            	
              Prior
                to the use thereof, Ascend shall provide to Columbia for review prototypes
                of all promotional materials created by Ascend.  Columbia shall
                notify Ascend of any objections it has to such prototype and the
                basis
                therefor within thirty (30) days following its receipt
                thereof.  Ascend shall modify such promotional materials to the
                extent necessary to resolve any objections made by Columbia to such
                promotional materials on the grounds that such promotional materials
                are
                inconsistent with any legal requirements or this Agreement and shall
                in
                good faith consider and address any of Columbia’s other
                objections.  If such promotional materials are approved by
                Columbia in accordance with this Section 5.8, Ascend shall provide
                Columbia with the requisite number of copies of the final form thereof
                in
                a timely manner so as to allow Columbia to satisfy its obligation
                to file
                such materials with DDMAC.

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            12 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    
      	
              5.9

            	
              To
                the extent requested by Ascend, Columbia shall deliver to Ascend
                all
                promotional materials created by Columbia in its inventory on the
                date
                hereof less a reasonable amount thereof for archival
                purposes.  Columbia shall have no obligation to create
                additional copies of any existing promotional materials or to otherwise
                incur any expense in connection with providing such existing promotional
                materials to Ascend.  Ascend agrees to reimburse Columbia for
                any direct costs incurred by Columbia in connection with fulfilling
                any
                request made by Ascend under this Section 5.9.  Any
                existing promotional materials supplied to Ascend under this
                Section 5.9 shall be delivered to a single location specified by
                Ascend in writing prior to such delivery.  Columbia hereby
                grants to Ascend the non-exclusive right, during the Term, to use
                any
                existing promotional materials supplied to Ascend pursuant to this
                Section 5.9 in the performance of its obligations under this
                Agreement.

            

    

    

    
      	
              5.10

            	
              On
                or prior to (a) December 1, 2007, and (b) October 1 of the preceding
                calendar year with respect to each calendar year during the Term,
                Ascend
                shall develop a marketing plan for the calendar year (as applicable),
                and
                submit the marketing plan to the Joint Steering Committee for review
                and
                approval.  The marketing plan shall set forth the manner in
                which the Product is to be promoted during the period to which the
                marketing plan relates.

            

    

    

    
      	
              5.11

            	
              The
                Parties acknowledge that each may receive requests for medical information
                concerning the Product from health care professionals and consumers
                regarding the Product.  Until the date six (6) months after the
                date hereof or such earlier date as Ascend may specify to Columbia
                in
                writing, the Parties shall coordinate all professional services activities
                through Columbia, who shall be the responsible party for responding
                to all
                such requests until such time.  Commencing on the date six (6)
                months after the date hereof or such earlier date as Ascend may specify
                to
                Columbia in writing, Ascend shall be responsible for promptly responding
                to such requests, which response shall be in compliance with all
                applicable legal requirements.  Each Party shall promptly
                provide the other Party with (i) copies of all written materials and
                (ii) written summaries of all oral advice, provided by such Party in
                response to such inquiries. 

            

    

    

    
      	
              5.12

            	
              Ascend
                shall promptly notify Columbia of any such actions taken by Ascend
                that
                are reasonably likely to result in a material adverse effect on the
                marketability of the Product in the
                Territory.

            

    

    

    
      	
              SECTION
                6 - REGULATORY AFFAIRS

            	
               

            

    

    

    
      	
              6.1

            	
              Columbia
                shall be responsible at its expense for maintaining the NDA for the
                Product with the FDA, provided, however, that any Phase IV Clinical
                Study
                will be at Ascend’s sole cost and expense and Ascend will provide to
                Columbia any information in Ascend’s possession that Columbia requires to
                meet its reporting obligations to FDA.  Ascend agrees that the
                NDA and any other submissions to FDA with respect to the Product
                shall be
                in the name of, and shall be owned by, Columbia or its designee.
                Notwithstanding anything to the contrary in this Agreement, should
                Columbia determine, in its sole

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            13 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              discretion,
                that certain information otherwise required to be disclosed to Ascend
                and/or to FDA contains trade secrets or proprietary information,
                then
                Columbia may disclose such information directly to FDA and not to
                Ascend,
                and Ascend hereby agrees not to seek to obtain such information from
                FDA,
                or through any other means.

            

    

    

    
      	
              6.2

            	
              Each
                Party shall notify the other Party as soon as possible of any notification
                received by the Party from FDA or any other regulatory authority
                to
                conduct an inspection of its manufacturing or other facilities used
                in the
                development, manufacturing, packaging, storage, or handling of the
                Product.  Copies of all material correspondence with the FDA or
                other regulatory authority related specifically to the development,
                manufacturing, packaging, storage, or handling of the Product will
                be
                provided by each Party to the other
                Party.

            

    

    

    
      	
              6.3

            	
              To
                the extent Ascend seeks to amend the labeling or support additional
                advertising claims for the Product, it may design, conduct and control
                such additional Phase IV Clinical Study at its sole expense necessary
                to
                obtain FDA approval, provided, that Ascend shall give Columbia prior
                written notice of its intention to do so. Product and placebo necessary
                for the conduct of such Phase IV Clinical Studies shall be supplied
                in
                bulk by Columbia at Columbia’s fully absorbed cost. Columbia shall own and
                have unrestricted rights to the clinical data generated as a result
                of
                each Phase IV Clinical Study to be filed in connection with Columbia's
                regulatory submissions both within and outside the
                Territory.

            

    

     

    
      	
              6.4

            	
              Unless
                otherwise required by law, Columbia will retain exclusive authority
                over
                and responsibility for complying with all regulatory requirements
                and
                maintaining all contacts with FDA with respect to the Product, including,
                but not limited to, maintaining and updating of the NDA, , the reporting
                of any Adverse Drug Reactions to the FDA, the compliance of promotional
                materials with FDA rules and regulations, and the filing of promotional
                materials with DDMAC, provided however that the submission of applications
                to FDA for new indications will be at Ascend’s cost. Ascend shall not,
                without the consent of Columbia or unless so required by law, correspond
                or communicate with the FDA or with any other governmental authority,
                whether within the Territory or otherwise, concerning the Product,
                or
                otherwise take any action concerning the NDA for the Product or any
                application.  Furthermore, Ascend shall, immediately upon
                receipt of any communication from the FDA or from any other governmental
                authority relating to the Product, forward a copy of the same to
                Columbia
                and respond to all inquiries by Columbia relating thereto.  If
                Ascend is required by law to communicate with the FDA or with any
                other
                governmental authority relating to the Product, then Ascend shall
                so
                advise Columbia immediately and provide Columbia in advance with
                a copy of
                any proposed written communication, or a written summary of any proposed
                oral communication with the FDA or any other governmental
                authority.  Ascend shall comply with any and all reasonable
                direction of Columbia concerning any meeting or written or oral
                communication with the FDA or any other governmental authority relating
                to
                the Product unless otherwise required by
                law.

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            14 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    
      	
              6.5

            	
              Ascend
                shall refer any oral or written Product Complaint which it receives
                concerning the Product to Columbia within four (4) days of its receipt
                thereof; provided, that all complaints concerning suspected or actual
                Product tampering, contamination or mix-up shall be delivered within
                twenty-four (24) hours of its receipt thereof.  Ascend shall not
                take any other action in respect of any such Product Complaint without
                the
                consent of Columbia unless otherwise required by law.  All
                Product Complaints shall be directed to:  Manager, Quality
                Assurance, by facsimile at (973)
                994 - 3001.

            

    

     

    
      	
              6.6

            	
              Each
                Party shall notify the other: (i) of all Serious Adverse Drug
                Experience Reports within forty-eight (48) hours of the time such
                Serious
                Adverse Drug Experience Report becomes known to such Party (including
                its
                employees); and (ii) of all Adverse Drug Experience Reports within
                five (5) days of the time such Adverse Drug Experience Report becomes
                known to such Party (including its employees). Except as may otherwise
                be
                required by law, (i) Ascend shall not disclose any information
                concerning Adverse Drug Experience Reports or Serious Adverse Drug
                Experience Reports to any person or governmental authority without
                the
                prior consent of Columbia; and (ii) Columbia shall have the sole
                discretion to determine whether any Product Complaint, Adverse Drug
                Experience Report or Serious Adverse Drug Experience Report must
                be
                reported to the FDA or any other governmental authority. All follow-up
                investigations concerning Adverse Drug Experience Reports and Serious
                Adverse Drug Experience Reports shall be conducted by Columbia; provided
                that Ascend shall have the right to participate in such investigations
                upon its request.  Ascend shall provide all reasonable
                cooperation with any such follow-up investigation as may be requested
                by
                Columbia from time to time.

            

    

     

    

    SECTION
      7 – MANUFACTURING AND
      SUPPLY, FORECASTS; PURCHASE ORDERS; MINIMUM PURCHASE
      OBLIGATIONS

    

    
      	
              7.1

            	
              Ascend
                Forecasts

            

    

    

    On
      or
      before November 15, 2007, and on or before the fifteenth (15th) day of
      each
      calendar month during the Term, Ascend shall submit to Columbia a written
      forecast of Ascend’s requirements, by month, for the following twelve (12)
      months (the “Rolling Forecast”). The initial forecast shall contain a forecast
      for [***]. The first six (6) months of each Rolling Forecast for Product in
      Finished Package Form will be firm orders (the
“Binding Forecast”).  It is understood that such forecasts, updated
      monthly, that extend beyond the Binding Forecast, are intended to be good faith
      estimates only, and shall not be binding upon Ascend.  As such, Ascend
      shall be bound to purchase from Columbia one hundred percent (100%) of those
      quantities of the Product set forth in each Binding Forecast and not to purchase
      any amounts forecasted beyond the Binding Forecast.  Columbia shall
      use Commercially Reasonable efforts to comply with Purchase Orders (as
      hereinafter defined) for Product furnished pursuant to Section 7.2, including
      Purchase Orders for Products in excess of [***]forecasted amounts; provided,
      however, that such inability to supply amounts in excess of [***]shall not
      constitute a breach of this Agreement by Columbia.  Columbia shall
      notify Ascend in writing of any prospective

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            15 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    problems
      of which it is aware that might prevent it from meeting Ascend’s forecasted
      order quantities or estimated delivery dates.

    

    7.2           Binding
      Purchase Orders

    

    With
      each
      Binding Forecast referenced in Section 7.1 hereof, Ascend shall furnish to
      Columbia a binding purchase order (each, a “Purchase Order”) for the quantity of
      the Product which Ascend shall purchase and Columbia shall deliver. Columbia
      shall acknowledge receipt of such Purchase Order and confirm that the Purchase
      Order can be supplied.  Each such Purchase Order shall designate the
      quantity of the Product, taking into consideration the fact that only full
      batch
      quantities may be ordered (except in the first calendar year of the Term when
      [***]may be ordered), production yields may vary, and full batch quantities
      may
      consist of more or less than the specified number of units.

    

    7.3           Excess
      Quantities; Changes in Purchase Requirements

    

    Columbia
      shall use Commercially Reasonable efforts to accommodate any Ascend request
      for
      any Product in excess of the quantities described in any previously-submitted
      Purchase Order, or for delivery of any of the Product sooner than as otherwise
      provided in such Purchase Order; provided, that, for quantities in excess of
      [***], Ascend shall bear any and all additional costs or expenses (including
      but
      not limited to additional costs or expenses associated with production,
      transportation or insurance related to shipping the Product) as a result of
      Columbia’s compliance with such request.  Should business conditions
      necessitate reduction or delay in Purchase Order requirements above the Minimum
      Purchase Obligations, then Columbia shall use Commercially Reasonable efforts
      to
      implement such requested changes; provided, that Ascend shall bear any and
      all
      additional costs or expenses (including but not limited to carrying costs or
      expenses associated with raw materials, schedule changes or finished goods
      inventory) as a result of Columbia’s compliance with such request.

    

    7.4           Minimum
      Purchase Obligations

    

    Ascend
      agrees to and shall comply with the Minimum Purchase Obligations during the
      Term
      set forth on Exhibit B hereto.

    

    7.5           Manufacturing
      Activities

     

    The
      Product to be manufactured by or for Columbia shall be manufactured to meet
      applicable specifications for the Product in accordance with the NDA, cGMP’s and
      in compliance with all other applicable legal requirements

     

    7.6           Delivery

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            16 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    Columbia
      shall deliver all Product EXW
      (as such term is defined and used in Incoterms2000, ICC Official Rules for
      Interpretation of Trade Terms) Columbia’s 

                   
      manufacturing facility.

    

    
      	
              7.7  

            	
              Inspection;
                Rejection

            

    

    

    Ascend
      may inspect the Product upon receipt to verify its conformity to the relevant
      Purchase Order as of the time the Product was delivered to Ascend.  If
      Ascend determines that a shipment of the Product does not conform to the
      Purchase Order as of the time it was delivered to Ascend, then Ascend shall
      notify Columbia in writing of all non-conformities that existed at the time
      of
      the delivery of the Product to Ascend.  Such notification shall be
      made as soon as reasonably practicable after discovery of the nonconformity,
      but
      not later than thirty (30) days after delivery of the Product.  Such
      notice shall specify the reasons for rejection.  If Ascend does not so
      reject the Product within thirty (30) days after delivery, Ascend shall be
      deemed to have accepted the Product.  After Ascend accepts the
      Product, or is deemed to have accepted the Product, it shall have no recourse
      against Columbia except as set forth in Sections 3.4.5, 4.8, and this Section
      7.  After notice of rejection is received by Columbia, Ascend shall
      cooperate with Columbia in determining whether such rejection is
      justified.  Columbia shall notify Ascend as soon as reasonably
      possible, but not later than thirty (30) days after receipt of the notice from
      Ascend, whether it accepts Ascend’s basis for rejection.  If Columbia
      accepts Ascend’s determination that the Product is non-conforming, then Ascend
      shall be entitled to the remedies set forth in Section 7.8 hereof.  If
      Columbia does not accept Ascend’s determination that the Product is
      non-conforming, and Ascend does not accept Columbia’s conclusion, then Columbia
      and Ascend shall jointly select an independent third party to determine whether
      it conforms to the Purchase Order.  The parties agree that such third
      party’s determination shall be final.  If the third party rules that
      the Product conformed to the Purchase Order as of the time the Product was
      delivered to Ascend, then Ascend shall purchase the Product at the agreed upon
      price.  If the third party rules that the Product does not conform to
      the Purchase Order at the time the Product was delivered to Ascend, then Ascend
      shall be entitled to the remedies set forth in Section 7.8 hereof.

    

    
      	
              7.8

            	
              Any
                Product delivered to Ascend by Columbia which is finally rejected
                in
                accordance with Section 7.7, or which is otherwise not in compliance
                with
                the warranties set forth in Section 7.5, shall be replaced at Columbia’s
                expense as soon as is Commercially
                Reasonable.

            

    

    

    7.9           Samples

     

    
      	
              7.9.1  

            	
              On
                or before
                December 15, 2007, Columbia will provide and Ascend will accept
                delivery of Samples which will be comprised of [***].

            

    

    

    
      	
              7.9.2  

            	
              Columbia
                shall provide or cause to be provided to Ascend, from time to time
                as
                reasonably requested by Ascend, and in such quantities as are mutually
                agreed by

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            17 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

            the
      parties to be
      reasonably necessary for Ascend to fulfill its promotion obligations under
      this
      Agreement, with samples of the Product (“Samples”) labeled as
      

            “Sample”or “Not
      for Sale” or in similar
      fashion and to be distributed by Ascend solely in connection with the
      performance of its sales force.  Columbia shall ship such

            Samples
      to a central
      warehouse designated by Ascend, and the risk of loss and responsibility for
      handling and warehousing of the Samples shall pass to Ascend upon 

            delivery
      to a carrier
      designated by Ascend.  Ascend shall be responsible for distributing
      the Samples to its sales representatives in a timely manner.  Columbia
      shall 

            invoice
Ascend
      for each shipment of Samples at its fully absorbed cost payable within 30 days
      of the invoice date.  

    

    
      	
              7.9.3  

            	
              Ascend
                shall be solely responsible for securing the return of and reconciling
                Sample inventories from discontinued sales representatives. Upon
                its
                receipt of Samples, Ascend shall be solely responsible for accountability
                and compliance with the PDMA, and other applicable legal requirements
                relating to such Samples or the distribution of same and shall be
                responsible for adherence by its sales representatives to such legal
                requirements.  Columbia shall have the right to audit the
                records and/or reports for the Samples, as required to be kept by
                Ascend
                under the PDMA, during normal business hours, at convenient times
                and upon
                no less than five (5) calendar days’ prior
                notice.

            

    

    

    7.10           Product Returns

     

          Each
      Party shall be responsible
      for all costs associated with the return of Product shipped by that Party
      before, during, or after the Term and whether received by Ascend or

          Columbia,
      provided such return is
      made in accordance with the Party’s published return policy. Each Party shall
      reimburse the other Party within 30 days of an invoice for 

          reasonable,
      documented costs
      incurred by a Party for the return of Product shipped by the other
      Party.

     

    SECTION
      8 – PRICE AND PAYMENT

    

    
      	
              8.1  

            	
              The
                purchase price to be paid by Ascend for the Product in Finished Package
                Form shall be thirty-five percent (35%) of the average Net Selling
                Price
                of the Product per unit in Finished Package Form in the calendar
                year
                multiplied by the number of units of Finished Package Form delivered
                to
                Ascend by Columbia.

            

    

     

    
      	
              8.2

            	
              Ascend's
                initial invoice price for the Product purchased from Columbia shall
                be
                [***]of the estimated purchase price pursuant to Section 8.1 and
                shall be
                paid thirty (30) days after the later of (A) receipt by Ascend of
                an
                invoice for such Product, or (B) the shipment by Columbia of the
                corresponding Product. Ascend's payments to Columbia shall be in
                U.S.
                dollars via wire
                transfer of immediately available funds to such bank account as Columbia
                shall designate in writing prior to the date of such payment. In
                the

            

    

     

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            18 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              event
                that any payment due under this Agreement is not made when due, the
                amount
                due shall accrue interest beginning on the tenth (10th) day following
                the
                date on which such payment was due, calculated at the annual rate
                equal to
                the higher of one percent (1.0%) per month or two percent (2%) above
                the
                thirty (30)-day LIBOR for U.S. dollars reported in the Wall Street
                Journal for the due date, calculated from the due date until paid in
                full. Such payment when made shall be accompanied by all interest
                so
                accrued.

            

    

     

    
      	
              8.3

            	
              Forty-five
                (45) days after the end of each calendar year any necessary adjustments
                to
                such purchase price to reflect the actual thirty-five percent (35%)
                of the
                average Net Selling Price of the Product per unit in Finished Package
                Form
                sold in the calendar year multiplied by the number of units of Finished
                Package Form delivered to Ascend by Columbia in the calendar year
                shall be
                made in a report from Ascend to Columbia. Overpayments by Ascend
                will be
                credited against the next purchase of Product. Underpayments by Ascend
                shall be paid to Columbia with the
                report.

            

    

     

    
      	
              8.4

            	
              Each
                Party shall keep full and accurate books, records and invoices with
                respect to the its Net Selling Price for no less than three (3) years
                after the end of the calendar year during which such sales occurred
                during
                the Term of this Agreement and for two (2) years
                thereafter.  Upon reasonable written notice and not more than
                twice in any twelve (12) month period, each Party shall permit an
                independent auditor reasonably acceptable to the other Party, to
                have
                access during normal business hours to sales and payment records
                directly
                related to sales of the Product in the Territory solely for the purpose
                of
                determining whether there has been an overpayment or underpayment
                by a
                Party pursuant to this Agreement for any period ending not more than
                twenty-four (24) months prior to the date of such request; provided,
                however, that the books and records for any particular period shall
                be
                subject to only one audit.  Any report rendered by the
                independent auditor in connection therewith shall only disclose whether
                there has been an overpayment or underpayment and the amount of such
                overpayment or underpayment (as the case may be).  The fees and
                expenses relating to the services of the independent auditor shall
                be
                borne by the Party requesting the audit; provided, however, that
                the other
                Party shall reimburse the Party requesting the audit for the reasonable
                fees and expenses of such auditor in the event the audit reveals
                an
                underpayment for the relevant period of more than five percent
                (5%).

            

    

    

    
      	
              8.5

            	
              In
                the event that Ascend determines to accept a bona fide offer from
                a third
                party, or a third party accepts a bona fide offer of Ascend, for
                the
                Product (i) on or before [***], Ascend agrees to pay Columbia [***],
                or
                (ii) after [***], but on or before [***], Ascend agrees to pay Columbia
                [***].  For the sake of clarity, this provision shall apply only
                when the sole asset being transferred is the Product and shall not
                apply,
                for example, in the event that the Product is transferred to a third
                party
                due to a merger, acquisition or other form of business
                combination.

            

    

    

    
      	
              SECTION
                9 - TERM AND TERMINATION

            	
               

            

    

    

    
      	
              9.1

            	
              This
                Agreement shall be deemed to have come into force on the date first
                written above and, subject to the rights of termination outlined
                in this
                Section 9 will expire on the five (5) year anniversary of the Effective
                Date (the "Term").

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            19 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    
      	
              9.2

            	
              In
                addition to the rights of termination provided for elsewhere in this
                Agreement, either Party will be entitled to terminate this Agreement
                by
                written notice to the other Party
                if:

            

    

    

    
      	
              9.2.1  
                

            	
              that
                other Party commits any breach of any of the provisions of this Agreement,
                and in the case of a breach capable of remedy, fails to remedy the
                same
                within sixty (60) days after receipt of a written notice of the breach
                and
                requiring it to be remedied or within ten (10) days in the case of
                a
                failure to make a monetary payment;
                or

            

    

    

    
      	
              9.2.2  
                

            	
              if
                that other Party shall make a general assignment for the benefit
                of
                creditors, or files or has filed against it a petition for
                bankruptcy, reorganization or an arrangement for the benefit of creditors,
                or for the appointment of a receiver, trustee or creditor representative
                for the property or assets of such Party under any federal or state
                insolvency law, which, if filed against such Party, has not been
                dismissed
                or discharged within sixty (60)
                days.

            

    

    

    
      	
              9.3

            	
              For
                the purposes of Section 9.2.1, a breach will be considered capable
                of
                remedy if the Party in breach can comply with the provision in question
                in
                all respects other than as to the time of performance (provided that
                time
                of performance is not of the
                essence).

            

    

    

    
      	
              9.4

            	
              Ascend
                may terminate this Agreement upon not less than sixty (60) days prior
                written notice to Columbia if:

            

    

     

                   9.4.1 A
      generic form of the Product enters the market or

    
      	
              9.4.2  
                

            	
              A
                product recall or market withdrawal occurs that is material to the
                reputation or ongoing supply of the product and not the result of
                the
                negligence or misconduct of Ascend.

            

    

    

    
      	
              9.5  

            	
              Ascend
                may terminate this Agreement without cause for any reason upon not
                less
                than one hundred eighty (180) days prior written notice to Columbia;
                provided, however, that: Ascend shall not be due any Sunset
                Fee.

            

    

    

    
      	
              9.6  

            	
              Columbia
                may terminate this Agreement upon written notice to Ascend in the
                event
                that (i) the number of units of Product dispensed to patients for
uses
                relating
                to fertility, pregnancy, and preterm birth in any calendar quarter,
                as determined by data from the IMS Health National Drug and Therapeutic
                Index, equals or exceeds [***]of
                Product dispensed for all uses in such calendar quarter, (ii) Columbia
                notifies Ascend in writing of Columbia’s intent to terminate this
                Agreement under this Section 9.6, and (iii) the number of units of
                Product
                dispensed to patients for uses
                relating
                to fertility, pregnancy, and preterm birth equals or exceeds [***]of  Product
                dispensed to patients for all
                uses
                during the three full calendar month period immediately following
                receipt of such notice (the "Cure Period"); provided, however, that
                Columbia may immediately terminate this Agreement at any time after
                the
                Cure Period upon written notice to Ascend in the event that the number
                of
                units of Product dispensed to patients for uses
                relating
                to fertility, pregnancy, and preterm birth in any three-month
                period after the Cure Period (and not

            

    

     

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            20 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    including
      any month during the Cure Period) equals or exceeds [***]of
      Product dispensed to patients for all uses in
      such
      three-month period.

     

    
      	
              9.7  

            	
              Ascend
                may terminate this Agreement upon written notice to Columbia in the
                event
                that (i) the number of units of Crinone and Prochieve 8% dispensed
                to
                patients for uses
                relating
                to the Indication in any calendar quarter, as determined by data
                from the IMS Health National Drug and Therapeutic Index, equals or
                exceeds
                [***]of
                Product dispensed for all uses in such calendar quarter, (ii) Ascend
                notifies Columbia in writing of Ascend’s intent to terminate this
                Agreement under this Section 9.7, and (iii) the number of units of
                Crinone
                and Prochieve 8% dispensed to patients for uses
                relating
                to the Indication equals or exceeds [***]of  Product
                dispensed to patients for all
                uses
                during the Cure Period; provided, however, that Ascend may
                immediately terminate this Agreement at any time after the Cure Period
                upon written notice to Columbia in the event that the number of units
                of
                Crinone and Prochieve 8% dispensed to patients for uses
                relating
                to the Indication in any three-month period after the Cure Period
                (and not including any month during the Cure Period) equals or exceeds
                [***]of
                Product dispensed to patients for all uses
                in such three-month period.

            

    

     

    

    
      	
              SECTION
                10 - CONSEQUENCES OF TERMINATION

            	
               

            

    

    

    
      	
              10.1

            	
              Upon
                exercise of those rights of termination specified in Section 9 or
                elsewhere in this Agreement, this Agreement shall, subject to the
                provisions of this Agreement which survive the termination of this
                Agreement, terminate and be of no further legal force or
                effect.

            

    

    

    
      	
              10.2

            	
              Termination
                of this Agreement by Columbia or by Ascend shall be without prejudice
                to
                Columbia’s right to receive payment of all obligations owed to, and costs
                incurred by, Columbia during the period prior to the effective date
                of the
                termination.  Ascend shall be liable to Columbia for any
                uncancellable obligations and expenses incurred by Columbia prior
                to such
                termination in connection with the Product and all costs incurred
                by
                Columbia in terminating such work.

            

    

    

    
      	
              10.3

            	
              Upon
                termination of the Agreement by either Party, the following shall
                be the
                consequences:

            

    

    

    
      	
              10.3.1  
                

            	
              all
                confidentiality provisions set out herein shall remain in full force
                and
                effect for a period of 10 years from the date of
                termination of this Agreement;

            

    

    

    
      	
              10.3.2 
                 

            	
              all
                responsibilities and warranties shall insofar as appropriate remain
                in
                full force and effect, including without limitation the provisions
                of
                Sections 3 (Intellectual Property) and 11 (Warranty and Indemnity),
                which
                shall survive any termination of this
                Agreement;

            

    

    

    
      	
              10.3.3 
                 

            	
              the
                rights of inspection and audit shall continue in force for the period
                referred to in the relevant provisions of this
                Agreement;

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            21 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

    

    
      	
              10.3.4  

            	
              Columbia
                shall be entitled to research, develop and commercialize the Product
                for
                its own benefit in the Territory in accordance with the provisions
                of
                Section 10.4; and

            

    

    

    
      	
              10.3.5  
                

            	
              Ascend
                shall deliver to Columbia all training and promotional materials
                created
                by Ascend in its inventory on the termination date less a reasonable
                amount thereof for archival
                purposes.

            

    

    

    
      	
              10.4  

            	
              Following
                (i) the Term (or any extension thereof), (ii) the early termination
                of
                this Agreement without cause by Columbia, or (iii) the early termination
                of this Agreement without cause by Ascend which termination is on
                or after
                January 1, 2010, Columbia shall pay to Ascend a “Sunset Fee” consisting of
                [***]of
                Columbia’s “Net Sales” (determined by multiplying Columbia’s
                average Net
                Selling Price during the period by the number of units sold by Columbia
                during the period) over [***]
                in the first full year after termination, and [***]of
                Columbia’s Net Sales over [***]
                in the second full year after
                termination.

            

    

    

    
      	
              10.5

            	
              Upon
                the termination of this Agreement for any reason, each Party shall
                return
                the other Party’s Confidential Information to such other Party or at the
                other Party’s option, destroy all originals and copies of the other
                Party’s Confidential Information; provided, that each Party may retain
                a
                copy of the other Party’s Confidential Information in its legal department
                for archival purposes.

            

    

     

    
      	
               

            	
              10.6

            	
              If
                this Agreement is terminated by Columbia for cause pursuant to Section
                9,
                Ascend shall discontinue use of the Product and shall arrange, at
                Ascend’s
                sole cost and expense, for the lawful disposal of all unsold
                Product.  In the event of any other termination or expiration of
                this Agreement, Ascend shall be entitled to retain, use and sell
                any
                remaining supplies of Product then in its possession or control,
                provided
                that any such use or sale shall be subject to the terms and restrictions
                of this Agreement and Columbia shall not take any action to impair
                such
                use or sale by Ascend;

            

    

    

    
      	
              10.7

            	
              If
                Columbia should require for any reason whatsoever a license from
                Ascend in
                order to research, develop and commercialize the Product after the Term or
                earlier termination of this Agreement, Ascend hereby grants to Columbia
                a
                non-exclusive, fully paid, royalty free license, with the right to
                sublicense, for the purposes of making, having made, packaging, importing,
                using, offering for sale, selling and having sold the
                Product.

            

    

    

    SECTION
      11 - WARRANTY AND INDEMNITY

    

    11.1           Each
      Party represents and warrants to the other Party that

    

    
      	
              11.1.1  
                

            	
              it is
                a corporation duly organized, validly existing and in good standing
                under
                the laws of the state of its incorporation, and it has all necessary
                corporate power and corporate authority to own its properties and
                to
                conduct its business, as currently
                conducted;

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            22 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

    

    
      

    

     

    
      	
              11.1.2  

            	
              the
                execution and delivery of this Agreement and the consummation of
                the
                transactions contemplated hereby are within its corporate power,
                have been
                duly authorized by all necessary corporate proceedings, and this
                Agreement
                has been duly executed and delivered by
                it;

            

    

    

    
      	
              11.1.3  

            	
              the
                execution and delivery of this Agreement and the consummation of
                the
                transactions contemplated hereby do not: conflict with or result
                in a
                breach of any provision of its organizational documents; result in a
                material breach of any material agreement to which it is
                party; require it to obtain any material approval or
                consent  from any governmental authority or third party other
                than those consents and approvals which have been obtained prior
                to the
                date hereof; or violate any legal requirement applicable to it in any
                material respect;

            

    

    

    
      	
              11.1.4  

            	
              this
                Agreement
                constitutes a valid and binding obligation, enforceable against it
                in
                accordance with its terms, subject to bankruptcy, reorganization,
                insolvency and other similar laws affecting the enforcement of creditors’
                rights in general and to general principles of equity (regardless
                of
                whether considered in a proceeding in equity or an action at law);
                and

            

    

    

    
      	
              11.1.5  

            	
              in
                performing a Phase IV Clinical Study, it will exercise all due skill
                and
                care in conducting such activities; and it will comply with the provisions
                of this Agreement, all FDA and other approvals, all applicable state
                and
                local regulatory approvals and all applicable laws, ordinances and
                regulations.

            

    

    

    
      	
              11.2  

            	
              Columbia
                warrants and represents to Ascend
                that:

            

    

    

    
      	
              11.2.1 
                  

            	
              to
                the knowledge of Columbia as of the date hereof, (i) the manufacture,
                use,
                importation, promotion and sale of the Product in the Territory in
                accordance with this Agreement will not infringe any patents, trademarks
                or other intellectual property rights of any third party, (ii) none
                of the
                Patents are invalid, (iii) the Patents are in full force and are
                not
                subject to any pending, or to the knowledge of Columbia as of the
                date
                hereof, threatened re-examination, opposition, interference or litigation
                proceedings in the Territory;

            

    

    

    
      	
               

            	
              11.2.2   
                

            	
              to
                the knowledge of
                Columbia as of the date hereof there is approximately one month of
                inventory of the Product in the
                trade;

            

    

    

    
      	
               

            	
              11.2.3 
                  

            	
              Columbia
                has not and will not during the Term acquire another product that
                competes
                directly with the Product, provided that, for the avoidance of doubt,
                the
                8% w/w progesterone gel (90 mg) in single use, one piece, disposable
                vaginal applicators containing 1.45 g of gel and delivering 1.125
                g of
                gel, utilizing the Columbia Technology, and approved by the FDA under
                NDA
                20-701, and any comparable product in a progressive hydration vaginal
                tablet, are not competitive
                products;

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            23 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

     

    
      	
               

            	
              11.2.4   
                

            	
              Columbia
                has not and during the Term will not enter into any contracts with
                government entities concerning the Product that require reimbursements
                under Medicaid, Medicare or other government payer
                programs;

            

    

    

    
      	
               

            	
              11.2.5   
                

            	
              as
                of the date
                hereof there are no pending or threatened Claims or IP Claims
                related to the Product; and

            

    

    

    
      	
               

            	
              11.2.6   
                

            	
              as
                of the date
                hereof the Product is safe and effective for use as it is currently
                labeled and sold.

            

    

    

    
      	
              11.3  

            	
              Indemnification
                by Columbia

            

    

    

    Columbia
      agrees that in addition to any and all other rights and remedies of Ascend,
      whether at law or in equity, Columbia shall defend, indemnify and hold Ascend
      and its Affiliates and their respective officers, directors, employees,
      independent contractors, agents, and assigns harmless from and against any
      and
      all actions claims, demands, proceedings, suits, losses, damages, costs and
      expenses (including reasonable attorneys’ fees) of whatsoever kind or nature
      (including but not limiting the generality of the foregoing, in respect of
      death, injury, loss or damage to any person or property) (collectively,
“Claims”) arising in any way out of or connected with: (i) any breach or alleged
      breach by Columbia of any representation, warranty or covenant contained in
      this
      Agreement; (ii) any negligence or willful misconduct by Columbia, its Affiliates
      or subcontractors; or (iii) any product liability Claim, unless such Claim
      arises from modifications of, or claims for, the Product by Ascend.

    

    
      	
              11.4  

            	
              Indemnification
                by Ascend

            

    

    

    Ascend
      agrees that in addition to any and all other rights and remedies of Columbia,
      whether at law or in equity, Ascend shall defend, indemnify and hold Columbia
      and its Affiliate, its officers, directors, employees, independent contractors,
      agents and assigns harmless from and against any and all Claims arising out
      of
      or connected with:  (i) any breach or alleged breach by Ascend of any
      representations, warranty or covenant contained in this Agreement; (ii) any
      negligence or willful misconduct by Ascend, its Affiliates or subcontractors;
      or
      (iii) any product liability Claim based on modifications of, or claims for,
      the
      Product by Ascend.

    

    
      	
              11.5  

            	
              Cooperation  The
                Parties agree that:

            

    

    

    
      	
              11.5.1   
                

            	
              the
                indemnifying Party shall have the right in its sole discretion to
                conduct
                all proceedings and negotiations connected with such Claims; provided,
                however, that the indemnifying Party shall not settle any Claim without
                the consent of the indemnified Party, which consent shall not be
                unreasonably withheld or delayed; and provided, further, that if
                the
                indemnifying Party fails to defend a Claim, the indemnified Party
                shall
                have the right to undertake the defense of any such
                Claim

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            24 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              at
                the expense and for the account of the indemnifying Party and the
                indemnifying Party shall pay all such expenses within thirty (30)
                days of
                the receipt of any invoice with respect
                thereto;

            

    

    

    
      	
              11.5.2
                   

            	
              the
                indemnified Party shall promptly notify the indemnifying Party of
                all such
                Claims and shall not make any admissions regarding them unless legally
                required to do so;

            

    

    

    
      	
              11.5.3   
                

            	
              the
                indemnified Party shall, at the indemnifying Party’s expense, provide the
                indemnifying Party with reasonable assistance in connection with
                such
                claims;

            

    

    

    
      	
              11.5.4   
                

            	
              the
                indemnifying Party shall keep the indemnified
                Party informed as to the status of any Claim, and
                not less than every sixty (60) days shall provide the indemnified
                Party with a written status report on the
                Claim.

            

    

    

    
      	
              11.6

            	
              THE
                WARRANTIES CONTAINED IN THIS SECTION 11 ARE IN LIEU OF ALL OTHER
                REPRESENTATIONS AND WARRANTIES.  COLUMBIA DISCLAIMS ALL OTHER
                WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ALL
                WARRANTIES OF MERCHANTABILITY, NON-INFRINGEMENT, EXCEPT AS OTHERWISE
                PROVIDED HEREIN, OR FITNESS FOR A PARTICULAR PURPOSE.  EXCEPT AS
                EXPRESSLY STATED IN SECTION 7 AND THIS SECTION 11, COLUMBIA SHALL
                NOT BE
                LIABLE IN CONTRACT, TORT OR OTHERWISE FOR ANY LOSS, DAMAGE, EXPENSE
                OR
                INJURY, ARISING OUT OF OR IN CONNECTION WITH A PRODUCT OR ANY DEFECT
                IN A
                PRODUCT OR FROM ANY OTHER CAUSE.

            

    

    

    
      	
              11.7

            	
              NOTWITHSTANDING
                ANYTHING TO THE CONTRARY IN THIS AGREEMENT, COLUMBIA AND
                ASCEND  SHALL NOT BE LIABLE TO THE OTHER BY REASON OF ANY
                CONDITION OR TERM OR DUTY OF COMMON LAW, OR UNDER THE EXPRESS TERMS,
                REPRESENTATIONS OR WARRANTIES OF THIS AGREEMENT, FOR ANY CONSEQUENTIAL,
                SPECIAL OR INCIDENTAL OR PUNITIVE LOSS OR DAMAGE (WHETHER FOR LOSS
                OF
                CURRENT OR FUTURE PROFITS, LOSS OF ENTERPRISE VALUE OR OTHERWISE)
                AND
                WHETHER OCCASIONED BY THE NEGLIGENCE OF THE RESPECTIVE PARTIES, THEIR
                EMPLOYEES OR AGENTS OR OTHERWISE.  EXCEPT AS OTHERWISE EXPRESSLY
                STATED IN THIS AGREEMENT, WITH RESPECT TO ANY CLAIM OF DAMAGES,
                COMPENSATION OR MONETARY RECOVERY OR OTHER RELIEF ASSERTED OR WHICH
                CAN BE
                ASSERTED BY ASCEND , IN NO EVENT SHALL ASCEND  MAKE ANY CLAIM,
                BE PERMITTED TO RECOVER, SEEK TO OBTAIN OR OBTAIN, ENCOURAGE OR ASSIST
                OR
                PERMIT ANY THIRD PARTY TO OBTAIN, ANY AWARD OF DAMAGES, FINDING OF
                LIABILITY OR ANY EQUIVALENT THERETO, REGARDLESS OF THE FORM OF SUCH
                ACTION, WHETHER IN CONTRACT OR TORT, OR AT LAW OR EQUITY AND WHETHER
                PERMITTED UPON FRAUD, MISREPRESENTATION OR OTHERWISE, AGAINST COLUMBIA,
                ITS SHAREHOLDERS, AFFILIATES, SUBSIDIARIES, AGENTS,
                EMPLOYEES,

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            25 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              DIRECTORS,
                OFFICERS AND/OR ANY PERSON OR ENTITY ACTING IN CONCERT OR UNDER THE
                DIRECTION OF COLUMBIA, IN AN AMOUNT WHICH WOULD RESULT IN A PAYMENT
                TO
                ASCEND  OR ANY OTHER PERSON OR ENTITY WHICH EXCEEDS THE TOTAL
                AMOUNTS ACTUALLY PAID TO COLUMBIA BY ASCEND  UNDER SECTION 8 OF
                THIS AGREEMENT DURING THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING
                THE
                DATE SUCH CLAIM OF LIABILITY IS MADE.  ASCEND AGREES TO ENTER
                INTO SUCH STIPULATIONS OF FACT OR LAW AS MAY BE REQUIRED TO GIVE
                EFFECT TO
                THIS PROVISION.

            

    

    

    
      	
              11.8

            	
              Insurance:

            

    

    

    
      	
              11.8.1  
                

            	
              At
                all times while this Agreement is in effect, each Party shall procure
                and
                maintain, at its own expense and for its own benefit, the following
                insurance in amounts no less than that specified for each
                type:

            

    

    

    
      	
              11.8.1.1   
                

            	
              commercial
                general liability insurance with combined limits of
                [***]per occurrence, [***]per accident
                for bodily injury, including death, and property damage, which policy
                shall include coverage for all hired, owned and not-owned automobiles
                and
                trucks;

            

    

     

    
      	
              11.8.1.2   
                

            	
              worker’s
                compensation and disability insurance in the amount required by the
                law of
                the state in which such party’s employees are located and employer’s
                liability insurance with limits of [***]per
                occurrence;

            

    

     

    
      	
              11.8.1.3   
                

            	
              automobile
                liability insurance covering automobiles and trucks used by or on
                behalf
                of such party with combined single limit of [***]per
                occurrence and [***]per accident for bodily injury,
                including death, and property damage, which policy shall include
                coverage
                for all hired, owned and not-owned automobiles and trucks;
                and

            

    

     

    
      	
              11.8.1.4   
                

            	
              product
                liability insurance with limits of not less than [***]per
                occurrence and in the aggregate.

            

    

     

    
      	
               

            	 	
              11.8.2  
                

            	
              Upon
                request, no more often than on an annual basis, a Party shall furnish
                the
                other Party with a certificate(s) from the insurance carrier(s) (having
                a
                minimum AM Best rating of A) showing the coverages set forth above
                and
                naming the other Party an additional insured.  This insurance
                may be cancelled or altered only after thirty (30) days written notice
                is
                given to the other Party.

            

    

    

    SECTION
      12 - MISCELLANEOUS PROVISIONS

    

    12.1           Confidentiality

    

    
      	
              12.1.1   
                

            	
              Any
                information, whether written or oral, pertaining to the Product or
                the
                commercialization thereof that has been or will be communicated or
                delivered by Columbia to Ascend, or by Ascend to Columbia, including,
                without limitation,

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            26 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              trade
                secrets, business methods, and cost, supplier, manufacturing and
                customer
                information, shall be treated by Ascend and Columbia, respectively,
                as
                Confidential Information, and shall not be disclosed or revealed
                to any
                third party whatsoever or used in any manner except as expressly
                provided
                for herein; provided, however, that such Confidential Information
                shall
                not be subject to the restrictions and prohibitions set forth herein
                to
                the extent that such Confidential
                Information:

            

    

    

    
      	
              12.1.1.1    
                

            	
              is
                available to the public in public literature or otherwise, or after
                disclosure by one Party to the other becomes publicknowledge through
                no
                fault of the Party receiving such Confidential
                Information; or

            

    

    

    
      	
              12.1.1.2   
                

            	
              was
                known to the Party receiving such Confidential Information prior
                to the
                receipt of such Confidential Information by such Party, whether received
                before or after the date of this Agreement;
                or

            

    

    

    
      	
              12.1.1.3   
                

            	
              is
                obtained by the Party  receiving such Confidential Information
                from a third party not subject to a requirement of confidentiality
                with
                respect to such Confidential Information;
                or

            

    

    

    
      	
              12.1.1.4   
                

            	
              is
                required to be disclosed pursuant to: (i) any order of a court having
                jurisdiction and power to order such information to be released or
                made
                public; or (ii) any lawful action of a governmental or regulatory
                agency
                provided that each Party  shall notify the other in writing of
                any disclosure of information required hereunder prior to such
                disclosure.

            

    

    

    
      	
              12.1.2 
                 

            	
              Each
                Party  shall take in relation to the Confidential Information of
                the other Party  all such precautions as it normally takes with
                its own Confidential Information to prevent any improper disclosure
                of
                such Confidential Information to any third party; provided, however,
                that
                such Confidential Information may be disclosed within the limits
                required
                to obtain any authorization from the FDA or any governmental or regulatory
                agency or, with the prior written consent of the other Party, which
                shall
                not be unreasonably withheld or delayed, or as may otherwise be required
                in connection with the purposes of this
                Agreement.

            

    

    

    
      	
              12.1.3   
                

            	
              Each
                of the Parties agrees that it will not use, directly or indirectly,
                any
                know-how of the other Party (including Columbia Know-How), or other
                Confidential Information disclosed to it by the other Party or obtained
                by
                it from the other Party  pursuant to this Agreement, other than
                as expressly provided herein.

            

    

    

    
      	
              12.1.4   
                

            	
              Neither
                Party will publicize the existence of this Agreement in any way without
                the prior written consent of the other Party subject to the disclosure
                requirements of applicable laws and regulations.  In the event
                that either Party wishes to make an announcement concerning the Agreement,
                that Party will seek the consent of the other Party.  The terms
                of any such announcement shall be agreed in good
                faith.  Columbia and Ascend shall also co-operate in good faith
                with respect to

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            27 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
               

            	
              any
                stock exchange filings, public announcements, or filings with the
                United
                States Securities and Exchange Commission that may be necessary following
                execution of this Agreement.

            

    

    

    
      	
              12.2  

            	
              Alternative
                Dispute Resolution

            

    

    

     

    
      	
              12.2.1  
                 

            	
              The
                Parties will try to settle their differences amicably between
                themselves.  If any claim, dispute, or controversy of whatever
                nature arising out of or relating to this Agreement, including the
                performance or alleged non-performance of a Party of its obligations
                under
                this Agreement arises between the Parties (each a “Dispute”), a Party may
                notify the other Party in writing of such Dispute.  If the
                Parties are unable to resolve the Dispute within 20 days of receipt
                of the
                written notice by the other Party, such Dispute will be referred
                to the
                Chief Executive Officers of each of the Parties who will use their
                good
                faith efforts to resolve the Dispute within 30 days after such
                referral.

            

    

     

    
      	
              12.2.2    
                

            	
              If
                a Dispute is not resolved as provided in the preceding Section 12.2.1,
                whether before or after termination of this Agreement, the Parties
                hereby
                agree to resolve such Dispute by final and binding arbitration
                administered under the rules of arbitration of the American Arbitration
                Association (AAA) (the “Rules”) by one arbitrator appointed in accordance
                with the Rules, provided that upon request of either Party, three
                arbitrators will be appointed, thus forming a panel.  If the
                Parties are unable to mutually select such panel within 30 days after
                initiating such selection procedure, the panel will be selected in
                accordance with the Rules as applicable to a panel of three
                arbitrators.  The decision and award rendered by the panel will
                contain findings of fact and conclusions of law and be final and
                binding.  In any such arbitration, the arbitrators will not have
                the right to modify the terms and conditions of this
                Agreement.  As a result, the rights and obligations of the
                Parties will be determined in accordance with the terms and conditions
                of
                this Agreement and any decision or award will be only in accordance
                with
                the terms and conditions of this Agreement.  The Parties will
                exert reasonable efforts to have the decision and award rendered
                within
                six (6) months after the first to occur of (i) notice of breach of
                this
                Agreement, which breach is a subject of the arbitration, and (ii)
                a notice
                invoking this arbitration provision.  Judgment upon the award
                may be entered in any court having jurisdiction thereof.  Any
                arbitration pursuant to this section will be held in Wilmington,
                Delaware,
                or such other place as may be mutually agreed upon in writing by
                the
                Parties.  With respect to any Disputes arising in connection
                with an alleged breach of a Party’s rights and obligations with respect to
                confidential Know-How or Confidential Information received from the
                other
                Party, the arbitrator will apply the discovery provisions of the
                Federal
                Rules of Civil Procedure.  This means that depositions may be
                taken and full discovery may be obtained in any arbitration commenced
                under this Section with respect to such
                Disputes.

            

    

     

    
      	
              12.2.3    
                

            	
              Notwithstanding
                the provisions of this Section, either Party will have the right
                to

            

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            28 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    seek
      temporary or permanent injunctive relief in any court of competent jurisdiction
      as may be available to such Party under the laws and rules applicable in such
      jurisdiction.

    

    
      	
              12.3 

            	
              Assignments/Sub-contracting

            

    

    

    This
      Agreement may not be assigned by either Party without the prior written consent
      of the other Party, which consent shall not be unreasonably withheld or delayed,
      except that a Party may without such consent assign this Agreement in whole
      or
      in part and delegate its duties hereunder to an Affiliate or a successor to
      all
      or substantially all of its business or assets whether by sale, merger,
      consolidation, acquisition, transfer, operation of law or otherwise; provided,
      that such assignment shall not relieve the assignor of any liability or
      obligation hereunder. Columbia shall also have the right to subcontract all
      or
      any portion of its obligations under this Agreement to a third party with the
      prior written consent of Ascend, which shall not be unreasonably withheld or
      delayed. Ascend hereby consents to those subcontractors of Columbia retained
      as
      of the date hereof.

    

    
      	
              12.4

            	
              Severability

            

    

    

    If
      any
      provision in this Agreement is agreed by the Parties to be, or is deemed to
      be,
      or becomes invalid, illegal, void or unenforceable under any law that is
      applicable hereto:

    

    
      	
              12.4.1   
                

            	
              such
                provision will be deemed amended to conform to applicable laws so
                as to be
                valid and enforceable or, if it cannot be so amended without materially
                altering the intention of the Parties, it will be deleted, with effect
                from the date of such agreement or such earlier date as the Parties
                may
                agree; and

            

    

    

    
      	
              12.4.2   
                

            	
              the
                validity, legality and enforceability of the remaining provisions
                of this
                Agreement shall not be impaired or affected in any
                way.

            

    

    

    
      	
              12.5

            	
              Force
                Majeure

            

    

    

    Neither
      Party  shall be liable to the other for delay or failure in the
      performance of the obligations on its part contained in this Agreement if and
      to
      the extent that such failure or delay is due to circumstances beyond its control
      which it could not have avoided by the exercise of reasonable diligence
      including but not limited to: act of God, war or insurrection; civil commotion;
      destruction of essential facilities or materials by earthquake, fire, flood
      or
      storm; labor disturbance (whether or not any such labor disturbance is within
      the power of the affected Party  to settle); epidemic; or other
      similar event; provided, however, that the Party  so affected shall
      notify the other Party  promptly should such circumstances arise,
      giving an indication of the likely extent and duration thereof, and shall use
      all Commercially Reasonable efforts to avoid, remove or alleviate such causes
      of
      non-performance and shall resume performance of its obligations hereunder with
      the utmost dispatch whenever such causes are removed. In the event of force
      majeure lasting more than six (6) months, the Parties agree to meet and discuss
      how this Agreement can be justly and fairly implemented under the circumstances
      and if the

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            29 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    Parties
      are unable to agree upon how the Agreement can be implemented then either Party
      may terminate the Agreement upon thirty (30) days written notice.

    

    
      	
              12.6

            	
              Relationship
                of the Parties

            

    

    

    Nothing
      contained in this Agreement shall be deemed to create any association,
      partnership, joint venture, or other relationship of principal and agent, master
      and servant, or employer and employee between the Parties to this Agreement
      or
      Affiliates thereof, or to provide either Party with the right, power or
      authority, whether express or implied, to create any such duty or obligation
      on
      behalf of the other Party.

    

    12.7         No
      Third-Party Rights

     

    This
      Agreement is intended for the exclusive benefit of the Parties hereto and their
      respective successors and permitted assigns. Nothing contained in the Agreement
      shall be construed as granting any rights or benefits in or to any third party,
      and no person shall assert any rights as third-party beneficiary
      hereunder.

     

    12.8          Entire
      Agreement

     

    This
      Agreement (including all schedules and exhibits attached hereto, which are
      incorporated herein by this reference) sets forth the entire agreement between
      the parties hereto pertaining to the subject matter hereof and all negotiations,
      preliminary agreements, memoranda or letters of proposal or intent, discussions
      and understandings of the parties hereto in connection with the subject matter
      hereof, including the Confidentiality Agreement May 22, 2007, are superseded
      hereby.  All discussions between the Parties have been merged into
      this Agreement and neither Party shall be bound by any definition, condition,
      understanding, representation, warranty, covenant or provision other than as
      expressly stated in or contemplated by this Agreement or as subsequently shall
      be set forth in writing and executed by a duly authorized representative of
      the
      party to be bound thereby.  The foregoing shall not relieve any party
      from liability resulting from the breach of the Confidentiality Agreement prior
      to the date hereof.

    

    12.9          Interpretation

     

    In
      this
      Agreement the singular includes the plural and vice versa, the masculine
      includes the feminine and vice versa, and references to natural persons include
      corporate bodies, partnerships and vice versa. Any reference to a Section or
      Exhibit, unless otherwise specifically provided, shall be respectively to a
      Section or Exhibit of this Agreement. The headings of this Agreement are for
      ease of reference only and shall not affect its construction
      or interpretation. The language used in this Agreement is deemed to be the
      language chosen by the Parties to express their mutual intent, and no rules
      of
      strict construction will be applied against any Party.

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            30 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    
      	
              12.10

            	
              Public
                Statements

            

    

    

    Neither
      Party shall use, or authorize others to use, the name, symbols, or marks of
      the
      other in any advertising or publicity material or make any form of
      representation or statement with regard to the services provided hereunder
      which
      would constitute an express or implied endorsement by such other of any
      commercial product or service without the other’s prior written
      approval.

    

    
      	
              12.11

            	
              Amendments

            

    

    

    No
      amendment, modification or addition hereto shall be effective or binding on
      either Party unless set forth in writing and executed by a duly authorized
      representative of each Party.

    

    
      	
              12.12

            	
              Waiver

            

    

    

    No
      waiver
      of any right under this Agreement shall be deemed effective unless contained
      in
      a written document signed by the Party charged with such waiver, and no waiver
      of any breach or failure to perform shall be deemed to be a waiver of any future
      breach or failure to perform or of any other right arising under this
      Agreement.

    

    
      	
              12.13

            	
              No
                Effect on Other
                Agreements

            

    

    

    No
      provision of this Agreement shall be construed so as to negate, modify or affect
      in any way the provisions of any other agreement between the Parties unless
      specifically referred to, and solely to the extent provided, in any such other
      agreement.

    

    
      	
              12.14

            	
              Governing
                Law and Jurisdiction

            

    

    

    This
      Agreement is construed under and ruled by the laws of the State of Delaware,
      without regard to that state’s rules on conflicts of law.

    

    The
      Parties agree that the United Nations Convention on Contracts for the
      International Sale of Goods shall not apply to the interpretation and
      construction of this Agreement

    

    
      	
              12.15

            	
              Counterparts

            

    

    

    This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed to be an original document, but all such separate counterparts shall
      constitute only one and the same instrument.

    

    
      	
              12.16

            	
              Notice

            

    

    

    All
      notices required or permitted hereunder shall be given in writing and sent
      by
      facsimile transmission, or mailed postage prepaid by certified or registered
      mail (return

     

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            31 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    receipt
      requested), or sent by a nationally recognized express courier service, or
      hand-delivered at the following address:

     

    Columbia
      at

    

    Columbia
      Laboratories, Inc.

    354
      Eisenhower Parkway

    Livingston,
      New Jersey 07039

    Attention:          President

    With
      copy
      to:   General Counsel

    

    Telephone:        973-994-3999

    Fax:                     973-994-3001

    

    Ascend
      at

    

    Ascend
      Therapeutics, Inc.,

    607
      Herndon Parkway

    Suite
      210

    Herndon,
      Virginia 20170.

    Attention:         
      President

    With
      copy
      to:   General Counsel

    

    Telephone:        703-471-4744

    Fax:                     703-478-0959

    

    or
      to
      such other address(es) and telecopier numbers as may from time to time be
      notified by either Party to the other hereunder.

    

    Any
      notice sent by overnight courier shall be deemed to have been delivered within
      2
      working days and any notice sent by telex or telecopy shall be deemed to have
      been delivered within 24 hours.  Notice of change of address shall be
      effective upon receipt.

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            32 of
            34

          
            

          

        

        
          
          

        

      

    

     

    
      

      

    

     

    IN
      WITNESS of which the Parties have executed this Agreement.

    

    ASCEND
      THERAPEUTICS, INC.

    

    By:           /S/
      Jay A
      Bua                                                      

    

    Name:                      Jay
      A
      Bua                                                      

    

    Title:                       
      President                                           

    

    

    COLUMBIA
      LABORATORIES, INC.

    

    By:           /S/
      Robert S
      Mills                                                      

    

    Name:                      Robert
      S
      Mills                                                      

    

    Title:                       
      President &
CEO                                                      

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            33 of
            34

          
            

          

        

        
          
          

        

      

    

    

    
      

      

    

    

    

    

    

    

    

    

    

    

    

    

    Exhibits
      A & B Intentionally Omitted

    

    

    

    
      
        
                

                     [***]
              A CONFIDENTIAL PORTION OF THE MATERIAL HAS BEEN OMITTED AND FILED SEPARATELY
              WITH THE SECURITIES AND EXCHANGE
              COMMISSION.      
      

                    

                        
        
      
    

          
          

        

        
          Page
            34 of
            34Unassociated Document

    
      	 
	 
	
              STRUCTURED
                ASSET MORTGAGE INVESTMENTS II INC.,

            
	 
	
              Depositor,

            
	 
	
              and

            
	 
	
              WELLS
                FARGO BANK, N.A.,

            
	 
	
              Grantor
                Trust Trustee

            
	 
	 
	 
	 
	 	 	 
	 	
               

              GRANTOR
                TRUST AGREEMENT

              Dated
                as of October 24, 2007

               

            	 
	 	 	 
	 
	 
	 
	
              $24,759,000

            
	 
	
              Bear
                Stearns Structured Products Inc. Trust 2007-R3

              Grantor
                Trust Certificates

              Series
                2007-R3

            
	 
	 
	 
	 

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TABLE
      OF
      CONTENTS

     

    
      	
              ARTICLE
                I

            	
              DEFINITIONS

            
	
              Section
                1.01.

            	
              Defined
                Terms.

            
	 	 
	
              ARTICLE
                II

            	
              CONVEYANCE
                OF THE UNDERLYING SECURITIES; ORIGINAL ISSUANCE OF GRANTOR TRUST
                CERTIFICATES

            
	
              Section
                2.01.

            	
              Conveyance
                of the Underlying Securities.

            
	
              Section
                2.02.

            	
              Acceptance
                of Trust Fund by Grantor Trust Trustee; Initial Issuance of Grantor
                Trust
                Certificates.

            
	
              Section
                2.03.

            	
              Representations
                and Warranties of the Depositor and the Grantor Trust
                Trustee.

            
	
              Section
                2.04.

            	
              Grantor
                Trust.  l:

            
	 	 
	
              ARTICLE
                III

            	
              ADMINISTRATION
                OF THE UNDERLYING SECURITIES; PAYMENTS AND REPORTS TO GRANTOR TRUST
                CERTIFICATEHOLDERS

            
	
              Section
                3.01.

            	
              Administration
                of the Trust Fund and the Underlying Security.

            
	
              Section
                3.02.

            	
              Collection
                of Monies.

            
	
              Section
                3.03.

            	
              Establishment
                of the Certificate Account; Deposits Therein.

            
	
              Section
                3.04.

            	
              Permitted
                Withdrawals From the Certificate Account.

            
	
              Section
                3.05.

            	
              Distributions.

            
	
              Section
                3.06.

            	
              Statements
                to Grantor Trust Certificateholders.

            
	
              Section
                3.07.

            	
              Access
                to Certain Documentation and Information.

            
	
              Section
                3.08.

            	
              Calculation
                of Distribution Amounts.

            
	
              Section
                3.09.

            	
              Annual
                Statement as to Compliance.

            
	
              Section
                3.10.

            	
              Assessments
                of Compliance and Attestation Reports.

            
	
              Section
                3.11.

            	
              Reports
                Filed with Securities and Exchange Commission.

            
	
              Section
                3.12.

            	
              Reserve
                Account

            
	
              Section
                3.13.

            	
              The
                Yield Maintenance Agreement

            
	
              Section
                3.14.

            	
              Yield
                Maintenance Credit Support Annex

            
	 	 
	
              ARTICLE
                IV

            	
              THE
                GRANTOR TRUST CERTIFICATES

            
	
              Section
                4.01.

            	
              The
                Grantor Trust Certificates.

            
	
              Section
                4.02.

            	
              Registration
                of Transfer and Exchange of Grantor Trust
                Certificates.

            
	
              Section
                4.03.

            	
              Mutilated,
                Destroyed, Lost or Stolen Grantor Trust
                Certificates.

            
	
              Section
                4.04.

            	
              Persons
                Deemed Owners.

            
	 	 
	
              ARTICLE
                V

            	
              THE
                GRANTOR TRUST TRUSTEE

            
	
              Section
                5.01.

            	
              Duties
                of Grantor Trust Trustee.

            
	
              Section
                5.02.

            	
              Certain
                Matters Affecting the Grantor Trust Trustee.

            
	
              Section
                5.03.

            	
              Grantor
                Trust Trustee Not Liable for Grantor Trust Certificates or Underlying
                Securities.

            
	
              Section
                5.04.

            	
              Grantor
                Trust Trustee May Own Grantor Trust Certificates.

            
	
              Section
                5.05.

            	
              Grantor
                Trust Trustee’s Fees and Expenses.

            
	
              Section
                5.06.

            	
              Eligibility
                Requirements for Grantor Trust Trustee.

            
	
              Section
                5.07.

            	
              Resignation
                and Removal of the Grantor Trust Trustee.

            
	
              Section
                5.08.

            	
              Successor
                Grantor Trust Trustee.

            
	
              Section
                5.09.

            	
              Merger
                or Consolidation of Grantor Trust Trustee.

            
	
              Section
                5.10.

            	
              Appointment
                of Co-Grantor Trust Trustee or Separate Grantor Trust
                Trustee.

            
	 	 
	
              ARTICLE
                VI

            	
              THE
                DEPOSITOR

            
	
              Section
                6.01.

            	
              Liability
                of the Depositor.

            
	
              Section
                6.02.

            	
              Merger,
                Consolidation or Conversion of the Depositor.

            
	
              Section
                6.03.

            	
              Limitation
                on Liability of the Depositor and Others.

            
	 	 
	
              ARTICLE
                VII

            	
              TERMINATION

            
	
              Section
                7.01.

            	
              Termination.

            
	 	 
	
              ARTICLE
                VIII

            	
              MISCELLANEOUS
                PROVISIONS

            
	
              Section
                8.01.

            	
              Amendment.

            
	
              Section
                8.02.

            	
              Counterparts.

            
	
              Section
                8.03.

            	
              Limitation
                on Rights of Grantor Trust Certificateholders.

            
	
              Section
                8.04.

            	
              Governing Law.

            
	
              Section
                8.05.

            	
              Notices.

            
	
              Section
                8.06.

            	
              Severability of Provisions.

            
	
              Section
                8.07.

            	
              Successors
                and Assigns.

            
	
              Section
                8.08.

            	
              Article
                and Section Headings.

            
	
              Section
                8.09.

            	
              Notices
                to Rating Agency.

            
	
              Section
                8.10.

            	
              Acts
                of Grantor Trust
                Certificateholders.

            

    

    

    

    
      	
              Exhibit
                A

            	
              -

            	
              Form
                of Grantor Trust Certificates

            
	
              Exhibit
                B

            	
              -

            	
              Form
                of Annual Certification

            
	
              Exhibit
                C

            	
              -

            	
              Servicing
                Criteria to Be Addressed in Assessment of Compliance

            
	
              Exhibit
                D

            	
              -

            	
              Form
                10-D, Form 8-K and Form 10-K Reporting Responsibility

            
	
              Exhibit
                E

            	
              -

            	
              Additional
                Disclosure Notification

            
	
              Exhibit
                F

            	
              -

            	
              Yield
                Maintenance Agreement

            
	
              Schedule
                A

            	
              -

            	
              Underlying
                Securities

            

    

     

     

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    GRANTOR
      TRUST AGREEMENT, dated as of October 24, 2007, by and between STRUCTURED ASSET
      MORTGAGE INVESTMENTS II INC., as depositor (the “Depositor”), and Wells
      Fargo Bank, N.A., as grantor trust trustee (the “Grantor Trust
      Trustee”).

     

    PRELIMINARY
      STATEMENT

     

    The
      Depositor intends to cause the issuance of and to sell its Grantor Trust
      Certificates, Series 2007-R3, Class A-1 Grantor Trust Certificates representing
      in the aggregate the entire beneficial ownership of a trust fund, the primary
      asset of which is the Underlying Securities (as defined herein).

     

    All
      things necessary to make this Agreement a valid declaration of trust by the
      Depositor in accordance with its terms have been done.

     

    In
      consideration of the premises and the mutual agreements herein contained, the
      Depositor and the Grantor Trust Trustee agree as follows:

     

    ARTICLE
      I

     

    DEFINITIONS

     

    Section
      1.01.  Defined
      Terms.

     

    Whenever
      used in this Agreement, including the Preliminary Statement, the following
      words
      and phrases, unless the context otherwise requires, shall have the following
      meanings:

     

    Affiliate:  With
      respect to any specified Person, any other Person that directly, or indirectly
      through one or more intermediaries, controls or is controlled by, or is under
      common control with, such specified Person.  For the purposes of this
      definition, “control” when used with respect to any specified Person means
      possession, direct or indirect, of the power to direct or cause the direction
      of
      the management and policies of such Person, whether through the ownership of
      voting securities, by contract or otherwise, and the terms “controlling,”
“controlled by” and “under common control with” have meanings correlative to the
      foregoing.

     

    Agreement:  This
      Grantor Trust Agreement and all amendments hereof and supplements
      hereto.

     

    Available
      Funds:  As of any date of determination, the aggregate amount on
      deposit in the Certificate Account as of such date received with respect to
      the
      Underlying Securities net of any portion thereof which represents amounts to
      be
      paid to any Person pursuant to clauses (ii) and (iv) of Section 3.04, plus
      any
      Reserve Account Distribution Amount.

     

    Bear
      Stearns:  Bear, Stearns & Co. Inc.

     

    Business
      Day:  Any day other than (i) a Saturday or a Sunday, or (ii) a day
      on which banking institutions in the cities of New York, New York, Columbia,
      Maryland, Minneapolis, Minnesota or any city in which the Corporate Trust Office
      of the Grantor Trust Trustee is located are authorized or obligated by law
      or
      executive order to be closed.

     

    Certificate
      Account:  The trust account or accounts, which shall at all times
      be Eligible Accounts, created and maintained by the Grantor Trust Trustee for
      the benefit of the Grantor Trust Certificateholders pursuant to Section
      3.03.  Funds deposited in the Certificate Account shall be held in
      trust for the Grantor Trust Certificateholders for the uses and purposes set
      forth in Article III hereof.

     

    Certificate
      Register:  Shall have the meaning provided in Section
      4.02.

     

    Class:  Collectively,
      all of the Grantor Trust Certificates bearing the same designation.

     

    Class
      A-1 Grantor Trust Certificate:  Any Class A-1 Grantor Trust
      Certificate as executed hereunder by the Grantor Trust Trustee and authenticated
      and delivered hereunder by the Grantor Trust Trustee, substantially in the
      form
      of Exhibit A hereto.

     

    Closing
      Date: October 24, 2007.

     

    Code:  The
      Internal Revenue Code of 1986, as amended.

     

    Commission:  U.S.
      Securities and Exchange Commission.

     

    Corporate
      Trust Office:  The corporate trust office of the Grantor Trust
      Trustee at which at any particular time its corporate trust business with
      respect to this Agreement shall be administered, which office at the date of
      the
      execution of this Agreement, for purposes other than presentment and surrender
      of the Grantor Trust Certificates, is located at Wells Fargo Bank, N.A., P.O.
      Box 98, Columbia, Maryland 21046 (or, for overnight deliveries, 9062 Old
      Annapolis Road, Columbia, Maryland 21045), Attention: Client Manager – BSSP
      2007-R3, and for purposes of presentment and surrender of the Grantor Trust
      Certificates for registration of transfer, exchange or final payment, is located
      at Wells Fargo Bank, N.A., Sixth Street and Marquette Avenue, Minneapolis,
      Minnesota 55479, Attention: Corporate Trust Services – BSSP 2007-R3, or any
      other address that the Grantor Trust Trustee may designate from time to time
      by
      notice to the Grantor Trust Certificateholders.

     

    Current
      Principal Amount:  With respect to any Grantor Trust Certificate,
      as of any date of determination, (i) the sum of (a) the original principal
      amount of such Grantor Trust Certificate and (b) any Net Deferred Interest
      added
      to the certificate principal balance of the Underlying Securities on the related
      Underlying Distribution Date pursuant to the Underlying Agreement, minus (ii)
      the sum of (a) the aggregate of all distributions of principal previously made
      on that Grantor Trust Certificate pursuant to Section 3.05 and (b) the principal
      portion of all Realized Losses previously allocated to such Grantor Trust
      Certificate pursuant to Section 3.05.

     

    Cut-off
      Date:  October 1, 2007.

     

    Definitive
      Certificates:  The meaning specified in Section 4.01(b)
      hereof.

     

    Depositor:  Structured
      Asset Mortgage Investments II Inc., a Delaware corporation, or its successor
      in
      interest.

     

    Depository:  DTC,
      the nominee of which is Cede & Co., or any successor thereto.

     

    Depository
      Agreement:  The meaning specified in Subsection 4.01(a)
      hereof.

     

    Depository
      Participant:  A broker, dealer, bank or other financial
      institution or other Person for whom from time to time the Depository effects
      book-entry transfers and pledges of securities deposited with the
      Depository.

     

    Distribution
      Date:  The Underlying Securities Distribution Date, commencing in
      October 2007.

     

    DTC:  The
      Depository Trust Company.

     

    Eligible
      Account:  Any of (i) an account or accounts maintained with a
      federal or state chartered depository institution or trust company, the
      long-term unsecured debt obligations and short-term unsecured debt obligations
      of which (or, in the case of a depository institution or trust company that
      is
      the principal subsidiary of a holding company, the debt obligations of such
      holding company, so long as Moody’s is not a Rating Agency) are rated by the
      Rating Agency in one of its two highest long-term and its highest short-term
      rating categories, respectively, at the time any amounts are held on deposit
      therein; provided, that following a downgrade, withdrawal, or suspension of
      such
      institution’s rating as set forth above, each account shall promptly (and in any
      case within not more than 30 calendar days) be moved to one or more segregated
      trust accounts in the trust department of such institution, or to an account
      at
      another institution that complies with the above requirements, or (ii) a trust
      account or accounts maintained with the corporate trust department of a federal
      or state chartered depository institution or trust company having capital and
      surplus of not less than $50,000,000, acting in its fiduciary capacity or (iii)
      any other account acceptable to the Rating Agency, as evidenced in writing.
      Eligible Accounts may bear interest, and may include, if otherwise qualified
      under this definition, accounts maintained with the Grantor Trust Trustee.
      Notwithstanding Section 8.01, this Agreement may be amended to reduce the rating
      requirements in clause (i) above, without the consent of any of the Grantor
      Trust Certificateholders, provided that the Person requesting such amendment
      obtains a letter from the Rating Agency stating that such amendment would not
      result in the downgrading or withdrawal of the respective ratings then assigned
      to the Grantor Trust Certificates.

     

    ERISA:  The
      Employee Retirement Income Security Act of 1974, as amended, and the rules
      and
      regulations promulgated thereunder.

     

    Exchange
      Act:  The Securities Exchange Act of 1934, as
      amended.

     

    Final
      Distribution Date:  With respect to each Underlying Security, the
      Underlying Security Distribution Date on which the final distribution thereon
      is
      to be made in accordance with the Underlying Agreement; and with respect to
      the
      Grantor Trust Certificates, the  Distribution Date on which the final
      distribution thereon is to be made in accordance with this
      Agreement.

     

    First
      Available Funds Cap:  An amount equal to (a) the sum of (i) the
      amount of interest paid to the Underlying Securities on the first Underlying
      Distribution Date and (ii) the Reserve Account Deposit Portion A, divided by
      (b)
      the Current Principal Amount of the Grantor Trust Certificates immediately
      prior
      to the first Underlying Distribution Date.

     

    Grantor
      Trust Certificates:  The Class A-1 Grantor Trust
      Certificates.

     

    Grantor
      Trust Certificate Owner:  Any Person who is the beneficial owner
      of a Grantor Trust Certificate registered in the name of the Depository or
      its
      nominee.

     

    Grantor
      Trust Certificateholder or Holder:  The person in whose name a
      Grantor Trust Certificate is registered in the Certificate Register, except
      that, subject to Sections 8.01(b) and 8.10(e), solely for the purpose of giving
      any consent, approval or waiver pursuant to this Agreement, any Grantor Trust
      Certificate registered in the name of the Depositor or any Affiliate thereof
      shall be deemed not to be outstanding and shall not be taken into account for
      purposes of determining whether the Holders of Grantor Trust Certificates
      evidencing the requisite aggregate Percentage Interest necessary to effect
      any
      such consent, approval or waiver has been obtained, unless such Persons
      collectively own all the Grantor Trust Certificates.

     

    Grantor
      Trust Trustee: Wells Fargo Bank, N.A., in its capacity as grantor trust
      trustee, or its successor in interest.

     

    Guarantor:
      As defined in Section 3.13.

     

    Guaranty:
      As defined in Section 3.13.

     

    Interest
      Accrual Period:  For each Distribution Date other than the first
      Distribution Date, the period beginning with and including 25th day of
      the month
      immediately preceding such Distribution Date and ending on and including the
      24th day of
      the
      calendar month in which such Distribution Date occurs. The Interest Accrual
      Period for the first Distribution Date will be the period beginning with and
      including October 24, 2007 and ending on but not including October 25,
      2007.

     

    Interest
      Distribution Amount:  With respect to the Grantor Trust
      Certificates and any Distribution Date, the amount of interest accrued during
      the related Interest Accrual Period at the related Pass-Through Rate on the
      Current Principal Amount of the Grantor Trust Certificates immediately prior
      to
      such Distribution Date, adjusted for any Distribution Date following the second
      Distribution Date for any Net
      Deferred Interest allocated to the Underlying Securities on the related
      Underlying Distribution Date pursuant to the Underlying Agreement for such
      Distribution Date.

     

    Investment
      Company Act:  The Investment Company Act of 1940, as amended from
      time to time, and the rules and regulations promulgated thereunder.

     

    Latest
      Possible Final Distribution Date: With respect to the Grantor Trust
      Certificates, the Distribution Date occurring in October 2037.

     

    Majority
      Grantor Trust Certificateholders:  With respect to the Grantor
      Trust Certificates, the Holders of the Grantor Trust Certificates evidencing
      in
      the aggregate greater than 50% of the aggregate Current Principal Amount of
      the
      Grantor Trust Certificates.

     

    Moody’s:
      Moody’s Investors Service, Inc.

     

    Net
      Deferred Interest: As defined in the pooling and servicing agreement, dated
      as of September 1, 2007, among Structured Asset Mortgage Investments II Inc.,
      Citibank, N.A., Wells Fargo Bank, N.A. and EMC Mortgage Corporation, relating
      to
      the Underlying Securities.

     

    NMWHFIT:
      shall mean a “Non-Mortgage Widely Held
      Fixed Investment Trust” as that term is defined in Treasury Regulations Section
      1.671-5(b)(12) or successor provisions.

     

    Notice
      of Final Distribution:  With respect to each Underlying Security,
      any notice provided pursuant to the Underlying Agreement to the effect that
      final distribution on such Underlying Security shall be made only upon
      presentment and surrender thereof.  With respect to the Grantor Trust
      Certificates, the notice to be provided pursuant to Sections 7.01(b) to the
      effect that final distribution on the Grantor Trust Certificates shall be made
      only upon presentment and surrender thereof.

     

    Officer’s
      Certificate:  A certificate signed by the Chairman of the Board,
      the Vice Chairman of the Board, the President or a Vice President or Assistant
      Vice President or other authorized officer of the Depositor and delivered to
      the
      Grantor Trust Trustee, as required by this Agreement.

     

    Opinion
      of Counsel:  A written opinion of counsel, who may be counsel for
      the Depositor, which opinion is addressed to the Grantor Trust Trustee and
      is
      reasonably acceptable to the Grantor Trust Trustee.

     

    Pass-Through
      Rate:  With respect to the Grantor Trust Certificates, (i) on the
      first Distribution Date, a rate that would be required to accrue an amount
      of
      interest on the initial principal balance during a 30-day accrual period at
      a
      pass-through rate of 21.81025% per annum, subject to the First Available Funds
      Cap, (ii) on the second Distribution Date, a rate of 15.50% per annum, subject
      to the Second Available Funds Cap and (iii) on all subsequent Distribution
      Dates, a variable per annum pass-through rate equal to the weighted average
      of
      the pass-through rates of the Underlying Securities, as reported in the
      Underlying Distribution Date Statement for the Underlying Security Distribution
      Date.

     

    Percentage
      Interest:  With respect to the Grantor Trust Certificates, the
      portion of the Grantor Trust Certificates represented by such Grantor Trust
      Certificate, expressed as a percentage, the numerator of which is the initial
      outstanding Current Principal Amount of the Grantor Trust Certificates as of
      the
      Closing Date, as specified on the face thereof, and the denominator of which
      is
      the Original Current Principal Amount of all Grantor Trust
      Certificates.

     

    Permitted
      Investments: Any one or more of the following obligations
      or  securities held in the name of the Grantor Trust Trustee for the
      benefit of the Grantor Trust Certificateholders:

     

    
      	
              (i)  

            	
              obligations
                of the United States or any agency thereof, provided such obligations
                are
                backed by the full faith and credit of the United
                States;

            

    

     

    
      	
              (ii)  

            	
              general
                obligations of or obligations guaranteed by any state of the United
                States
                or the District of Columbia receiving the highest long-term debt
                rating of
                the Rating Agency, or such lower rating as will not result in the
                downgrading or withdrawal of the ratings then assigned to the Grantor
                Trust Certificates by the Rating Agency, as evidenced in
                writing;

            

    

     

    
      	
              (iii)  

            	
              commercial
                or finance company paper which is then receiving the highest commercial
                or
                finance company paper rating of the Rating Agency, or such lower
                rating as
                will not result in the downgrading or withdrawal of the ratings then
                assigned to the Grantor Trust Certificates by the Rating Agency,
                as
                evidenced in writing;

            

    

     

    
      	
              (iv)  

            	
              certificates
                of deposit, demand or time deposits, or bankers’ acceptances issued by any
                depository institution or trust company incorporated under the laws
                of the
                United States or of any state thereof and subject to supervision
                and
                examination by federal and/or state banking authorities (including
                the
                Grantor Trust Trustee in its commercial banking capacity), provided
                that
                the commercial paper and/or long term unsecured debt obligations
                of such
                depository institution or trust company are then rated one of the
                two
                highest long-term and the highest short-term ratings of each such
                Rating
                Agency for such securities, or such lower ratings as will not result
                in
                the downgrading or withdrawal of the rating then assigned to the
                Grantor
                Trust Certificates by any Rating Agency, as evidenced in
                writing;

            

    

     

    
      	
              (v)  

            	
              guaranteed
                reinvestment agreements issued by any bank, insurance company or
                other
                corporation containing, at the time of the issuance of such agreements,
                such terms and conditions as will not result in the downgrading or
                withdrawal of the rating then assigned to the Grantor Trust Certificates
                by the Rating Agency, as evidenced in
                writing;

            

    

     

    
      	
              (vi)  

            	
              repurchase
                obligations with respect to any security described in clauses (i)
                and (ii)
                above, in either case entered into with a depository institution
                or trust
                company (acting as principal) described in clause (v)
                above;

            

    

     

    
      	
              (vii)  

            	
              securities
                (other than stripped bonds, stripped coupons or instruments sold
                at a
                purchase price in excess of 115% of the face amount thereof) bearing
                interest or sold at a discount issued by any corporation incorporated
                under the laws of the United States or any state thereof which, at
                the
                time of such investment, have one of the two highest short term ratings
                of
                the Rating Agency (except if the Rating Agency is Moody’s, such rating
                shall be the highest commercial paper rating of Moody’s for any such
                securities), or such lower rating as will not result in the downgrading
                or
                withdrawal of the rating then assigned to the Grantor Trust Certificates
                by the Rating Agency, as evidenced by a signed writing delivered
                by the
                Rating Agency;

            

    

     

    
      	
              (viii)  

            	
              interests
                in any money market fund (including any such fund managed or advised
                by
                the Grantor Trust Trustee or any affiliate thereof) which at the
                date of
                acquisition of the interests in such fund and throughout the time
                such
                interests are held in such fund has the highest applicable short
                term
                rating by the Rating Agency rating such fund or such lower rating
                as will
                not result in the downgrading or withdrawal of the ratings then assigned
                to the Grantor Trust Certificates by the Rating Agency, as evidenced
                in
                writing;

            

    

     

    
      	
              (ix)  

            	
              short
                term investment funds sponsored by any trust company or banking
                association incorporated under the laws of the United States or any
                state
                thereof (including any such fund managed or advised by the Grantor
                Trust
                Trustee or any affiliate thereof) which on the date of acquisition
                has
                been rated by the Rating Agency in their respective highest applicable
                rating category or such lower rating as will not result in the downgrading
                or withdrawal of the ratings then assigned to the Grantor Trust
                Certificates by the Rating Agency, as evidenced in writing;
                and

            

    

     

    
      	
              (x)  

            	
              such
                other investments having a specified stated maturity and bearing
                interest
                or sold at a discount acceptable to the Rating Agency and as will
                not
                result in the downgrading or withdrawal of the rating then assigned
                to the
                Grantor Trust Certificates by any Rating Agency, as evidenced by
                a signed
                writing delivered by the Rating
                Agency;

            

    

     

    provided,
      that no such instrument shall be a Permitted Investment if such instrument
      (i)
      evidences the right to receive interest only payments with respect to the
      obligations underlying such instrument, (ii) is purchased at a premium or (iii)
      is purchased at a deep discount; provided further that no such instrument shall
      be a Permitted Investment (A) if such instrument evidences principal and
      interest payments derived from obligations underlying such instrument and the
      interest payments with respect to such instrument provide a yield to maturity
      of
      greater than 120% of the yield to maturity at par of such underlying
      obligations, or (B) if it may be redeemed at a price below the purchase price
      (the foregoing clause (B) not to apply to investments in units of money market
      funds pursuant to clause (viii) above). Permitted Investments that are subject
      to prepayment or call may not be purchased at a price in excess of
      par.

     

    Person:  Any
      individual, corporation, partnership, limited liability company, joint venture,
      association, joint-stock company, trust, unincorporated organization or
      government or any agency or political subdivision thereof.

     

    Prospectus
      Supplement: The Prospectus
      Supplement dated
      October 24, 2007 relating to the public offering of the Grantor Trust
      Certificates.

     

    Purchase
      Agreement:  The Purchase Agreement, dated as of October 24, 2007,
      between EMC Mortgage Corporation and the Depositor relating to the Underlying
      Securities.

     

    Rating
      Agency:  S&P or its successors.  If such agency or
      its successors are no longer in existence, “Rating Agency” shall be
      deemed to refer to such nationally recognized statistical rating agency, or
      other comparable Person, designated by the Depositor, notice of which
      designation shall be given to the Grantor Trust Trustee, and specific ratings
      of
      the Rating Agency shall be deemed to refer to the equivalent ratings of the
      party so designated.

     

    Record
      Date:  For the Grantor Trust Certificates and the first
      Distribution Date, the Closing Date, and for any Distribution Date thereafter,
      the last Business Day of the month preceding the month in which such
      Distribution Date occurs.

     

    Regulation
      AB:  Subpart 229.1100 – Asset Backed Securities (Regulation AB),
      17 C.F.R. §§229.1100-229.1123, as amended from time to time, and subject to such
      clarification and interpretation as have been provided by the Commission in
      the
      adopting release (Asset-Backed Securities, Securities Act Release No. 33-8518,
      70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the Commission,
      or
      as may be provided by the Commission or its staff from time to
      time.

     

    Repurchase
      Price:  In connection with the repurchase of any of the Underlying
      Securities pursuant to Section 2.03(c), a price equal to the outstanding
      principal balance thereof as of the date of repurchase plus accrued interest
      thereon.

     

    Reserve
      Account:  The account established and maintained pursuant to
      Section 3.12 of this Agreement, which shall be an Eligible Account.

     

    Reserve
      Account Deposit:  The amount to be paid by the Depositor to the
      Grantor Trust Trustee for deposit in the Reserve Account on the Closing Date,
      which amount is equal to $500,000.00.

     

    Reserve
      Account Deposit Portion A: The sum of (i) that portion of the Reserve
      Account Deposit equal to $368,299.21, which may be invested on the Closing
      Date
      in a Permitted Investment designated by the Depositor, maturing on or before
      the
      first Distribution Date following the Closing Date and (ii) the proceeds of
      any
      Permitted Investment specified in clause (i).

     

    Reserve
      Account Deposit Portion B: The sum of (i) that portion of the Reserve
      Account Deposit equal to $131,700.79, which may be invested on the Closing
      Date
      in a Permitted Investment designated by the Depositor (separate from any
      Permitted Investment relating to the Reserve Account Deposit Portion A),
      maturing on or before the second Distribution Date following the Closing Date,
      (ii) the proceeds of any Permitted Investment described in clause (i) and (iii)
      the Reserve Account Deposit Portion A remaining after the first Distribution
      Date.

     

    Reserve
      Account Distribution Amount:  With respect to the first
      Distribution Date following the Closing Date, the Reserve Account Deposit
      Portion A to the extent necessary to cover the Interest Distribution Amount
      for
      the Grantor Trust Certificates for such Distribution Date, and with respect
      to
      the second Distribution Date following the Closing Date, the Reserve Account
      Deposit Portion B and any amounts received by the Grantor Trust Trustee in
      respect of the Yield Maintenance Agreement.

     

    Responsible
      Officer:  When used with respect to the Grantor Trust Trustee, any
      officer of the Grantor Trust Trustee assigned to and working in its Corporate
      Trust Office or similar group administering the Trusts hereunder and also,
      with
      respect to a particular matter, any other officer of the Grantor Trust Trustee
      to whom a particular matter is referred by the Grantor Trust Trustee because
      of
      such officer’s knowledge of and familiarity with the particular
      subject.

     

    S&P:
      Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and its
      successors in interest.

     

    Second
      Available Funds Cap:  An amount equal to (a) the sum of (i) the
      amount of interest collected from the Underlying Securities on the second
      Underlying Distribution Date, (ii) the Reserve Account Deposit Portion B and
      (iii) amounts received by the Grantor Trust Trustee in respect of the Yield
      Maintenance Agreement, divided by (b) the Current Principal Amount of the
      Grantor Trust Certificates immediately prior to the second Underlying
      Distribution Date.

     

    Securities
      Act:  The Securities Act of 1933, as amended.

     

    Servicing
      Criteria:  The “servicing criteria” set forth in Item 1122(d) of
      Regulation AB, as such may be amended from time to time, or those Servicing
      Criteria otherwise mutually agreed to by the Sponsor, the Grantor Trust Trustee
      and the Depositor in response to evolving interpretations of Regulation AB
      and
      incorporated into a revised Exhibit C.

     

    Significance
      Estimate:  With respect to any Distribution Date, and in
      accordance with Item 1115 of Regulation AB, shall be an amount determined based
      on the reasonable good-faith estimate by the Sponsor or its affiliate of the
      aggregate maximum probable exposure of the outstanding Grantor Trust
      Certificates to the Yield Maintenance Agreement.

     

    Significance
      Percentage: With respect to any Distribution Date, and in accordance with
      Item 1115 of Regulation AB, shall be an percentage equal to the Significance
      Estimate divided by the outstanding Current Principal Amount of the Grantor
      Trust Certificates, prior to the distribution of Available Funds on such
      Distribution Date.

     

    Sponsor:  EMC
      Mortgage Corporation, or its successor in interest.

     

    Structured
      Asset Mortgage Investments II Trust 2007-AR7 Class A-4
      Certificates:  Structured Asset Mortgage Investments II Trust
      2007-AR7, Mortgage Pass-Through Certificates, Series 2007-AR7, Class A-4
      Certificates.

     

    Structured
      Asset Mortgage Investments II Trust 2007-AR7 Class III-A-2
      Certificates:  Structured Asset Mortgage Investments II Trust
      2007-AR7, Mortgage Pass-Through Certificates, Series 2007-AR7, Class III-A-2
      Certificates.

     

    Trust:
      Bear Stearns Structured Products Inc. Trust 2007-R3, created pursuant to this
      Agreement and comprised of the Trust Fund.

     

    Trust
      Fund:  The segregated pool of assets subject hereto, constituting
      the corpus of the Trust created hereby and to be administered hereunder,
      consisting of (i) the Underlying Securities, (ii) all amounts payable on the
      Underlying Securities pursuant to the Underlying Agreement following the Closing
      Date, (iii) the Reserve Account, (iv) the Certificate Account and such funds
      or
      assets as are from time to time deposited in the Certificate Account, (v) the
      Depositor’s rights under the Purchase Agreement and (vi) the income, payments
      and proceeds of each of the foregoing.

     

    Underlying
      Agreement:  The agreement pursuant to which the Underlying
      Securities were issued, as in effect on the Closing Date.

    

    Underlying
      Distribution Date Statement:  The monthly investor reports
      provided or made available pursuant to the Underlying Agreement in respect
      of
      the Underlying Securities in connection with the Underlying Security
      Distribution Date.

     

    Underlying
      Securities: The respective Underlying Security Class Percentage of the (i)
      Structured Asset Mortgage Investments II Trust 2007-AR7 Class A-4 Certificates
      and (ii) Structured Asset Mortgage Investments II Trust 2007-AR7 Class III-A-2
      Certificates, sold by the Depositor to, and registered in the name of, the
      Grantor Trust Trustee, for the benefit of the Holders of the Grantor Trust
      Certificates, pursuant to Section 2.01 and as more particularly described in
      Schedule A hereto.

     

    Underlying
      Security Class Percentage:  The percentage which each Underlying
      Security constitutes of its entire class as set forth in Schedule A attached
      hereto under the caption “Class % in Trust.”

     

    Underlying
      Security Distribution Date:  The 25th day of each month, or if
      such day is not a Business Day, then the next Business Day commencing in October
      2007.

     

    Underlying
      Securityholder:  The Grantor Trust Trustee or its Depository
      Participant for the benefit of the Grantor Trust
      Certificateholders.

     

    Underlying
      Series:  The series of securities which includes the Underlying
      Securities.

     

    WHFIT:
      shall mean a “Widely Held Fixed Investment Trust” as that term is defined in
      Treasury Regulations section 1.671-5(b)(22) or successor
      provisions.

     

    WHFIT
      Regulations: shall mean Treasury Regulations section 1.671-5, as
      amended.

     

    Yield
      Maintenance Agreement: The yield maintenance agreement, dated as of October
      24, 2007, between the Grantor Trust Trustee and [_____], including any schedule,
      confirmations, credit support annex or other credit support document relating
      thereto, and attached hereto as Exhibit F.

     

    Yield
      Maintenance Agreement Counterparty: The yield maintenance agreement
      counterparty under the Yield Maintenance Agreement.  Initially, the
      Yield Maintenance Agreement Counterparty shall be [______].

     

    Yield
      Maintenance Credit Support Annex: The yield maintenance credit support
      annex, dated as of October 24, 2007, between Grantor Trust Trustee and [_____],
      which is annexed to and forms part of the Yield Maintenance
      Agreement.

     

    ARTICLE
      II

     

    CONVEYANCE
      OF THE UNDERLYING SECURITIES; ORIGINAL ISSUANCE OF GRANTOR TRUST
      CERTIFICATES

     

    Section
      2.01.  Conveyance
      of the Underlying Securities.

     

    (a)  The
      Depositor, concurrently with the execution and delivery hereof, does hereby
      sell, transfer, assign, set-over and otherwise convey to the Grantor Trust
      Trustee, in trust, for the use and benefit of the Grantor Trust
      Certificateholders, without recourse, all the right, title and interest of
      the
      Depositor in and to (i) the Underlying Securities, (ii) the Purchase Agreement
      and (iii) all other assets constituting the Trust Fund.  Such
      assignment includes, without limitation, all amounts payable on the Underlying
      Securities pursuant to the Underlying Agreement following the Closing
      Date.

     

    (b)  In
      connection with such transfer and assignment, and concurrently with its
      execution and delivery of this Agreement, the Depositor shall have caused the
      Underlying Securities to be registered in the book-entry records of the
      Depository in the name of the Grantor Trust Trustee or its nominee.

     

    (c)  The
      transfer of the Underlying Securities and all other assets constituting the
      Trust Fund is absolute and is intended by the parties hereto as a
      sale.

     

    (d)  It
      is
      intended that the conveyances by the Depositor to the Grantor Trust Trustee
      of
      the Underlying Securities as provided for in this Section 2.01 be construed
      as a
      sale by the Depositor to the Grantor Trust Trustee of the Underlying Securities
      for the benefit of the Grantor Trust Certificateholders.  Further, it
      is not intended that any such conveyance be deemed to be a pledge of the
      Underlying Securities by the Depositor to the Grantor Trust Trustee to secure
      a
      debt or other obligation of the Depositor.  However, in the event that
      the Underlying Securities are held to be property of the Depositor, or if for
      any reason this Agreement is held or deemed to create a security interest in
      the
      Underlying Securities, then it is intended that (a) this Agreement shall also
      be
      deemed to be a security agreement within the meaning of Articles 8 and 9 of
      the
      New York Uniform Commercial Code and the Uniform Commercial Code of any other
      applicable jurisdiction; (b) the conveyance provided for in Section 2.01 shall
      be deemed to be a grant by the Depositor to the Grantor Trust Trustee of a
      security interest in all of the Depositor’s right (including the power to convey
      title thereto), title and interest, whether now owned or hereafter acquired,
      in
      and to (1) the Underlying Securities, (2) all amounts payable on the Underlying
      Securities in accordance with the terms thereof and (3) any and all general
      intangibles consisting of, arising from or relating to any of the foregoing,
      and
      all proceeds of the conversion, voluntary or involuntary, of the foregoing
      into
      cash, instruments, securities or other property, including without limitation
      all amounts from time to time held in the Certificate Account, whether in the
      form of cash, instruments, securities or other property; (c) the possession
      by
      the Grantor Trust Trustee or any agent of the Grantor Trust Trustee of such
      items of property as constitute instruments, money, negotiable documents or
      chattel paper shall be deemed to be “possession by the secured party,” or
      possession by a purchaser or a person designated by such secured party, for
      purposes of perfecting the security interest pursuant to the New York Uniform
      Commercial Code and the Uniform Commercial Code of any other applicable
      jurisdiction; and (d) notifications to persons holding such property, and
      acknowledgments, receipts or confirmations from persons holding such property,
      shall be deemed notifications to, or acknowledgments, receipts or confirmations
      from, financial intermediaries, bailees or agents (as applicable) of the Grantor
      Trust Trustee for the purpose of perfecting such security interest under
      applicable law.  It is also intended that the Trust be classified for
      federal income tax purposes as a grantor trust under Subpart E, part I of
      subchapter J of chapter 1 of the Code, of which the Grantor Trust
      Certificateholders are owners, rather than a partnership, an association taxable
      as a corporation or a taxable mortgage pool.  The powers granted and
      obligations undertaken in this Agreement shall be construed so as to further
      such intent.

     

    The
      Depositor and the Grantor Trust Trustee, at the Depositor’s or the Majority
      Grantor Trust Certificateholders’ direction, shall, to the extent consistent
      with this Agreement, take such reasonable actions as may be determined to be
      necessary to ensure that, if this Agreement were deemed to create a security
      interest in the Underlying Securities, and the other property described above,
      such security interest would be deemed to be a perfected security interest
      of
      first priority under applicable law and will be maintained as such throughout
      the term of this Agreement.

     

    Section
      2.02.  Acceptance
      of Trust Fund by Grantor Trust Trustee; Initial Issuance of Grantor Trust
      Certificates.

     

    The
      Grantor Trust Trustee acknowledges receipt of the Underlying Agreement and
      the
      receipt by it and the transfer, delivery and assignment to it of the Underlying
      Securities, in good faith and without notice of any adverse claim, and the
      assignment to it of all other assets included in the Trust Fund and declares
      that it holds and will hold the Underlying Securities and all other assets
      included in the Trust Fund in trust for the exclusive use and benefit of all
      present and future Grantor Trust Certificateholders in accordance with the
      terms
      of this Agreement.  Concurrently with such transfer, delivery and
      assignment and in exchange therefor, pursuant to the written request of the
      Depositor executed by an officer of the Depositor, the Grantor Trust Trustee
      has
      executed and caused to be authenticated and delivered to or upon the order
      of
      the Depositor, the Grantor Trust Certificates in authorized denominations
      evidencing the entire beneficial ownership of the Trust Fund.

     

    Until
      the
      Trust Fund is terminated in accordance with Section 7.01, except as provided
      herein, the Grantor Trust Trustee shall not assign, sell, dispose of or transfer
      any interest in the Underlying Securities or any other asset constituting the
      Trust Fund or permit the Underlying Securities or any other asset constituting
      the Trust Fund to be subjected to any lien, claim or encumbrance arising by,
      through or under the Grantor Trust Trustee or any person claiming by, through
      or
      under the Grantor Trust Trustee.

     

    Section
      2.03.  Representations
      and Warranties of the Depositor and the Grantor Trust Trustee.

     

    (a)  The
      Depositor hereby represents and warrants to the Grantor Trust Trustee, and
      for
      the benefit of the Grantor Trust Certificateholders, as of the Closing Date,
      that:

     

    (i)  The
      Depositor is a corporation duly organized, validly existing and in good standing
      under the laws of the State of Delaware, and the Depositor is possessed of
      all
      licenses necessary to carry on its business.

     

    (ii)  The
      execution and delivery of this Agreement by the Depositor, and the performance
      and compliance with the terms of this Agreement by the Depositor, will not
      violate the Depositor’s certificate of incorporation or bylaws or constitute a
      default (or an event which, with notice or lapse of time, or both, would
      constitute a default) under, or result in the breach of, any material agreement
      or other instrument to which it is a party or which is applicable to it or
      any
      of its assets.

     

    (iii)  The
      Depositor has the full right, power and authority to enter into and consummate
      all transactions contemplated by this Agreement, including but not limited
      to
      selling the Underlying Securities to the Grantor Trust Trustee, has duly
      authorized the execution, delivery and performance of this Agreement, and has
      duly executed and delivered this Agreement.

     

    (iv)  This
      Agreement, assuming due authorization, execution and delivery by the Grantor
      Trust Trustee, constitutes a valid, legal and binding obligation of the
      Depositor, enforceable against the Depositor in accordance with the terms
      hereof, subject to (A) applicable bankruptcy, insolvency, reorganization,
      moratorium and other laws affecting the enforcement of creditors’ rights
      generally, and (B) general principles of equity, regardless of whether such
      enforcement is considered in a proceeding in equity or at law.

     

    (v)  The
      Depositor is not in violation of, and its execution and delivery of this
      Agreement and its performance and compliance with the terms of this Agreement
      will not constitute a violation of, any law, any order or decree of any court
      or
      arbiter, or any order, regulation or demand of any federal, state or local
      governmental or regulatory authority, which violation is likely to affect
      materially and adversely either the ability of the Depositor to perform its
      obligations under this Agreement or the financial condition of the
      Depositor.

     

    (vi)  No
      litigation is pending or, to the best of the Depositor’s knowledge, threatened
      against the Depositor which, if determined adversely to the Depositor, would
      prohibit the Depositor from entering into this Agreement or is likely to
      materially and adversely affect either the ability of the Depositor to perform
      its obligations under this Agreement or the financial condition of the
      Depositor.

     

    (vii)  The
      Depositor was, immediately prior to the transfer of the Underlying Securities
      to
      the Grantor Trust Trustee, the sole owner thereof free and clear of any lien,
      pledge, charge or encumbrance of any kind (except any lien created by this
      Agreement).

     

    (viii)  The
      Depositor acquired the Underlying Securities in good faith without notice of
      any
      adverse claim, lien, charge, encumbrance or security interest (including without
      limitation, federal tax liens or liens arising under ERISA).

     

    (ix)  The
      Depositor has not assigned any interest in the Underlying Securities or any
      distributions thereon, except as contemplated herein.

     

    (x)  The
      Grantor Trust Trustee, will be entitled to distributions under the Underlying
      Agreement equal to all distributions of interest and principal made on the
      Underlying Securities.

     

    (xi)  The
      information relating to the Underlying Securities set forth in Schedule A is
      true and correct in all material respects.

     

    (xii)  The
      Underlying Securities are registered on the books of the Depository in the
      name
      of the Grantor Trust Trustee or its financial intermediary on behalf of the
      Grantor Trust Trustee.

     

    (xiii)  The
      Underlying Securities are “regular interests” in a real estate mortgage
      investment conduit within the meaning of Section 860G(a)(1) of the
      Code.

     

    (xiv)  The
      Depositor has no actual knowledge after reasonable inquiry that any of the
      Underlying Securities (1) were not validly issued by the underlying trust,
      (2)
      are not outstanding, (3) are not the legal, valid, binding and enforceable
      obligation of the underlying trust, and (4) are not entitled to the benefits
      of
      the Underlying Agreement pursuant to which such Underlying Security was issued
      (except as limited by bankruptcy, insolvency or other similar laws affecting
      the
      enforcement of creditors’ rights generally or to the extent that such
      enforceability may be subject to the exercise of judicial discretion in
      accordance with general equitable principles).

     

    (xv)  The
      information relating to the Underlying Securities set forth on Schedule A hereto
      conforms to information set forth in the Prospectus dated June 28, 2007 and
      the
      Prospectus Supplement dated September 17, 2007 for the Structured Asset Mortgage
      Investments II Trust 2007-AR7 Class A-4 Certificates and the Structured Asset
      Mortgage Investments II Trust 2007-AR7 Class III-A-2 Certificates.

     

    (b)  The
      Grantor Trust Trustee hereby represents and warrants to the Depositor and for
      the benefit of the Grantor Trust Certificateholders, as of the Closing Date,
      that:

     

    (i)  The
      Grantor Trust Trustee is a national banking association, duly organized and
      validly existing under the laws of the United States of America.

     

    (ii)  The
      execution and delivery of this Agreement by the Grantor Trust Trustee, and
      the
      performance and compliance with the terms of this Agreement by the Grantor
      Trust
      Trustee, will not violate the Grantor Trust Trustee’s charter or bylaws or
      constitute a default (or an event which, with notice or lapse of time, or both,
      would constitute a default) under, or result in the breach of, any material
      agreement or other instrument to which it is a party or which is applicable
      to
      it or any of its assets.

     

    (iii)  The
      Grantor Trust Trustee has the full power and authority to enter into and
      consummate all transactions contemplated by this Agreement, has duly authorized
      the execution, delivery and performance of this Agreement, and has duly executed
      and delivered this Agreement.

     

    (iv)  This
      Agreement, assuming due authorization, execution and delivery by the Depositor,
      constitutes a valid, legal and binding obligation of the Grantor Trust Trustee,
      enforceable against the Grantor Trust Trustee in accordance with the terms
      hereof, subject to (A) applicable bankruptcy, insolvency, reorganization,
      moratorium and other laws affecting the enforcement of creditors’ rights
      generally, and (B) general principles of equity, regardless of whether such
      enforcement is considered in a proceeding in equity or at law.

     

    (v)  The
      Grantor Trust Trustee is not in violation of, and its execution and delivery
      of
      this Agreement and its performance and compliance with the terms of this
      Agreement will not constitute a violation of, any law, any order or decree
      of
      any court or arbiter, or any order, regulation or demand of any federal, state
      or local governmental or regulatory authority, which violation is likely to
      affect materially and adversely the ability of the Grantor Trust Trustee to
      perform its obligations under this Agreement.

     

    (vi)  No
      litigation is pending or, to the best of the Grantor Trust Trustee’s knowledge,
      threatened against the Grantor Trust Trustee which would prohibit the Grantor
      Trust Trustee from entering into this Agreement or is likely to materially
      and
      adversely affect the ability of the Grantor Trust Trustee to perform its
      obligations under this Agreement.

     

    (vii)  The
      Underlying Securities will be held by the Grantor Trust Trustee through the
      Depository or its nominee; it has acquired the Underlying Securities on behalf
      of the Grantor Trust Certificateholders from the Depositor in good faith, for
      value, and the Grantor Trust Trustee has not received notice of, and has no
      actual knowledge of, any adverse claim, lien, charge, encumbrance or security
      interest (including, without limitation, federal tax liens or liens arising
      under ERISA); it has not and will not, in any capacity except as Grantor Trust
      Trustee, on behalf of the Grantor Trust Certificateholders, assert any claim
      or
      interest in the Underlying Securities and will hold the Underlying Securities
      and the proceeds thereof in trust pursuant to the terms of this Agreement;
      and
      it has not encumbered or transferred its right, title or interest in the
      Underlying Securities.

     

    (c)  It
      is
      understood and agreed that the foregoing representations and warranties shall
      survive the execution and delivery of this Agreement.  Upon discovery
      by either party hereto of a breach of any of the foregoing representations
      and
      warranties which materially and adversely affects the interests of the Grantor
      Trust Certificateholders or either party hereto, the party discovering such
      breach will give prompt written notice thereof to the other party hereto and
      to
      the Grantor Trust Certificateholders.  Within thirty (30) days of the
      earlier of either discovery by or notice to the Depositor of any breach of
      a
      representation or warranty of the Depositor that materially and adversely
      affects the interests of the Grantor Trust Certificateholders, the Depositor
      shall use its best efforts promptly to cure such breach in all material respects
      and, if such breach cannot be cured, the Depositor shall, at the election of
      the
      Majority Grantor Trust Certificateholders, repurchase the Underlying Security
      affected by the breach at the Repurchase Price.  If the Depositor is
      to repurchase any Underlying Security, the Grantor Trust Trustee shall promptly
      determine the Repurchase Price in accordance with the definition
      thereof.  Repurchase of any Underlying Security pursuant to the
      foregoing provisions of this Section 2.03(c) shall be accomplished by deposit
      by
      the Depositor in the Certificate Account on the Business Day prior to the next
      succeeding Distribution Date of the amount of the Repurchase Price.

     

    Section
      2.04.  Grantor
      Trust.  The Trust created hereby is intended to qualify as an
“investment trust” within the meaning of Treasury Regulation §301.7701-4(c), and
      it is neither the purpose nor the intent of the parties hereto to create a
      partnership, joint venture, taxable mortgage pool or association taxable as
      a
      corporation between or among the Grantor Trust Certificateholders, the Grantor
      Trust Trustee or the Depositor.  In furtherance of the foregoing, the
      purpose of the Trust shall be to protect and conserve the assets of the Trust,
      and the Trust shall not at any time engage in or carry on any kind of business
      or any kind of commercial or investment activity.  Subject to the
      foregoing, the Trust shall:

     

    (i)  issue
      the
      Grantor Trust Certificates to, or at the written direction of, the Depositor
      in
      exchange for the Underlying Securities;

     

    (ii)  perform
      the activities of the Trust that are expressly set forth in this
      Agreement;

     

    (iii)  engage
      in
      those activities that are reasonably necessary, suitable or convenient to
      accomplish the foregoing or are incidental thereto or connected therewith;
      and

     

    (iv)  subject
      to compliance with this Agreement, engage in such other activities as may be
      required in connection with conservation of the Trust and the making of
      distributions to the Grantor Trust Certificateholders.

     

    The
      Trust
      is hereby authorized to engage in the foregoing activities. The Trust shall
      not
      engage in any activity other than the foregoing or other than as required or
      authorized by the terms of this Agreement while any Grantor Trust Certificate
      is
      outstanding without the consent of all of the Grantor Trust Certificateholders;
      provided, however, that in no event shall the Grantor Trust Trustee or any
      other
      Person have any duty, responsibility or power to vary the investment of the
      Grantor Trust Certificateholders in the Grantor Trust Certificates or to
      substitute new investments or reinvest so as to enable the Trust to take
      advantage of variations in the market to improve the investment of the Grantor
      Trust Certificateholders in the Grantor Trust Certificates.

     

    ARTICLE
      III

     

    ADMINISTRATION
      OF THE UNDERLYING SECURITIES;

    PAYMENTS
      AND REPORTS TO GRANTOR TRUST CERTIFICATEHOLDERS

     

    Section
      3.01.  Administration
      of the Trust Fund and the Underlying Security.

     

    If
      at any
      time the Grantor Trust Trustee, as a holder of the Underlying Securities, is
      requested in such capacity, whether by a Grantor Trust Certificateholder, a
      holder of a certificate of the Underlying Series or a party to the Underlying
      Agreement or any other Person, to take any action or to give any consent,
      approval or waiver, including, without limitation, in connection with an
      amendment of the Underlying Agreement, the Grantor Trust Trustee shall promptly
      notify all of the Holders of Grantor Trust Certificates and the Depositor of
      such request and of its planned course of action with respect thereto and shall,
      in its capacity as a holder of the Underlying Securities, take such action
      in
      connection with the exercise and/or enforcement of any rights and/or remedies
      available to it in such capacity with respect to such request, as the Majority
      Grantor Trust Certificateholder of the Grantor Trust Certificates shall direct
      in writing.

     

    Section
      3.02.  Collection
      of Monies.

     

    (a)  In
      connection with its receipt of any distribution on the Underlying Securities
      on
      any Underlying Security Distribution Date, the Grantor Trust Trustee shall
      review the related Underlying Distribution Date Statement and shall confirm
      that
      the aggregate amount of such distribution received by it with respect to the
      Underlying Securities is consistent with the Underlying Distribution Date
      Statements (it being understood that the Grantor Trust Trustee shall be entitled
      to rely on the accuracy and correctness of the Underlying Distribution Date
      Statements).

     

    (b)  If
      the
      Grantor Trust Trustee receives a Notice of Final Distribution in respect of
      any
      Underlying Security, the Grantor Trust Trustee shall present and surrender
      the
      related Underlying Security which is in certificated form for final payment
      thereon, if required, in accordance with the terms and conditions of the
      Underlying Agreement and such notice.  The Grantor Trust Trustee shall
      promptly deposit in the Certificate Account the final distribution received
      upon
      presentation and surrender of such Underlying Security for distribution in
      accordance with Section 3.05 hereof on the next succeeding Distribution Date
      for
      the Grantor Trust Certificates.

     

    Section
      3.03.  Establishment
      of the Certificate Account; Deposits Therein.

     

    (a)  The
      Grantor Trust Trustee, for the benefit of the Grantor Trust Certificateholders,
      shall establish and maintain one or more interest bearing trust accounts
      (collectively, the “Certificate Account”), each of which shall be an
      Eligible Account, entitled “Wells Fargo Bank, N.A., as grantor trust trustee for
      the registered Holders of Bear Stearns Structured Products Inc. Trust 2007-R3,
      Grantor Trust Certificates, Series 2007-R3,” held in trust by the Grantor Trust
      Trustee for the benefit of the Grantor Trust Certificateholders with respect
      to
      the portion of such accounts in the Trust Fund.  The Grantor Trust
      Trustee shall cause to be deposited directly into the Certificate Account all
      distributions received on the Underlying Securities by the Grantor Trust
      Trustee, from whatever source, and all amounts received by it representing
      payment of a Repurchase Price pursuant to Section 2.03(c), subsequent to the
      Closing Date.  The Certificate Account is initially located at the
      Grantor Trust Trustee.  The Grantor Trust Trustee shall give notice to
      the Depositor and to the Grantor Trust Certificateholders of any new location
      of
      the Certificate Account prior to any change thereof.

     

    (b)  In
      the
      event that payments in respect of the Underlying Securities are received by
      the
      Grantor Trust Trustee prior to the related Distribution Date, the Grantor Trust
      Trustee may invest such funds deposited in the Certificate Account in one or
      more Permitted Investments held in the name of the Grantor Trust Trustee and
      shall receive as compensation, any interest or investment income earned on
      such
      Permitted Investments, which may be withdrawn by the Grantor Trust Trustee
      on
      each Distribution Date and shall not constitute Available Funds. Notwithstanding
      the foregoing, no such Permitted Investment may mature later than such related
      Distribution Date and no such investment shall be sold prior to its maturity
      date. The amount of any losses incurred in respect of any such investments
      shall
      be deposited in the Certificate Account by the Grantor Trust Trustee immediately
      as realized out of its own funds.

     

    (c)  The
      Depositor shall cause all distributions received on the Underlying Securities
      by
      the Depositor or any of its Affiliates after the Closing Date to be remitted
      promptly to the Grantor Trust Trustee for deposit into the Certificate
      Account.

     

    Section
      3.04.  Permitted
      Withdrawals From the Certificate Account.

     

    The
      Grantor Trust Trustee may from time to time withdraw funds from the Certificate
      Account for the following purposes:

     

    (i)  to
      make
      distributions in the amounts and in the manner provided for in Section
      3.05;

     

    (ii)  to
      pay to
      the Person entitled thereto any amount deposited in the Certificate Account
      in
      error;

     

    (iii)  to
      clear
      and terminate the Certificate Account upon the termination of this Agreement;
      and

     

    (iv)  to
      pay
      itself, as additional compensation, the net reinvestment income permitted to
      be
      paid to it as provided in Section 3.03(b).

     

    On
      each
      Distribution Date, the Grantor Trust Trustee shall withdraw all funds from
      the
      Certificate Account and shall use such funds withdrawn from the Certificate
      Account only for the purposes described in this Section 3.04 and in Section
      3.05.

     

    Section
      3.05.  Distributions.

     

    (a)  On
      each
      Distribution Date, the Grantor Trust Trustee shall withdraw amounts from the
      Certificate Account and the Reserve Account representing the Available Funds
      for
      such Distribution Date and apply them to pay the Grantor Trust Certificates
      in
      the following manner and order of priority:

     

    (i)  from
      amounts representing interest received on the Underlying Securities, if any,
      and
      the Reserve Account Distribution Amounts with respect to the first and second
      Distribution Dates, to the Holders of the Class A-1 Grantor Trust Certificates,
      as a distribution of interest, the Interest Distribution Amount for the Class
      A-1 Grantor Trust Certificates for such Distribution Date; and

     

    (ii)  from
      amounts representing principal received on the Underlying Securities, if any,
      to
      the Holders of the Class A-1 Grantor Trust Certificates, as distributions of
      principal, until the Current Principal Amount of the Class A-1 Grantor Trust
      Certificates has been reduced to zero.

     

    (b)  With
      respect to the second Distribution Date, the portion of the Available Funds
      consisting of the Reserve Account Deposit Portion B remaining following
      distributions on such Distribution Date will be distributed to the Class A-1
      Grantor Trust Certificates on such Distribution Date as interest.

     

    (c)  All
      distributions made to Holders of the Grantor Trust Certificates pursuant to
      Sections 3.05(a) and (b) on each Distribution Date shall be allocated
prorata among the outstanding Grantor Trust Certificates based
      upon their respective Percentage Interests and, except in the case of the final
      distribution to the Holders of the Grantor Trust Certificates, shall be made
      to
      the Holders of record on the related Record Date.  Distributions to
      any Grantor Trust Certificateholder on any Distribution Date shall be made
      by
      wire transfer of immediately available funds to the account of such Grantor
      Trust Certificateholder at a bank or other entity having appropriate facilities
      therefor, if such Grantor Trust Certificateholder shall have so notified the
      Grantor Trust Trustee in writing (which wiring instructions may be in the form
      of a standing order applicable to all future Distribution Dates) no less than
      five (5) Business Days prior to the related Record Date (or, in the case of
      the
      initial Distribution Date, no later than the related Record Date) and is the
      registered owner of Grantor Trust Certificates with an aggregate initial Current
      Principal Amount of not less than $1,000,000, or otherwise by check mailed
      by
      first class mail to the address of such Grantor Trust Certificateholder
      appearing in the Certificate Register.  Final distribution to each
      Grantor Trust Certificateholder will be made in like manner, but only upon
      presentment and surrender of such Grantor Trust Certificate at the Corporate
      Trust Office or such other location specified in the notice to Grantor Trust
      Certificateholders of such final distribution.

     

    (d)  Notwithstanding
      any other provision of this Agreement, the Grantor Trust Trustee shall comply
      with all federal withholding requirements respecting payments to Grantor Trust
      Certificateholders of interest or the accrual of discount that the Grantor
      Trust
      Trustee reasonably believes are applicable under the Code.  The
      consent of Grantor Trust Certificateholders shall not be required for such
      withholding.  In the event the Grantor Trust Trustee does withhold any
      amount from payments to any Grantor Trust Certificateholder pursuant to federal
      withholding requirements, the Grantor Trust Trustee shall indicate the amount
      withheld to such Grantor Trust Certificateholders.

     

    (e)  Realized
      Losses.  On any Distribution Date, following distributions to be
      made on that Distribution Date, any Realized Losses (as defined in the
      Underlying Agreement) allocated to the Underlying Securities shall be allocated
      to the Class A-1 Grantor Trust Certificates, until the Current Principal Amount
      thereof has been reduced to zero.  Realized Losses shall be allocated
prorata among the outstanding Grantor Trust Certificates based
      upon their respective Percentage Interests.

     

    Section
      3.06.  Statements
      to Grantor Trust Certificateholders.

     

    On
      each
      Distribution Date, the Grantor Trust Trustee shall prepare and make available
      to
      each Grantor Trust Certificateholder, the Depositor and the Rating Agency,
      on
      its website, a statement with respect to such Distribution Date,
      stating:

     

    (i)  the
      Available Funds for such Distribution Date, including the cash flows received
      and the sources thereof for distributions;

     

    (ii)  the
      Interest Distribution Amount, and the portion thereof, if any, provided by
      the
      Yield Maintenance Agreement, and the amount with respect to principal paid
      on
      the Grantor Trust Certificates with respect to such Distribution
      Date;

     

    (iii)  the
      Current Principal Amount of the Grantor Trust Certificates before and after
      applying payments on such Distribution Date;

     

    (iv)  the
      applicable record dates, accrual dates and actual Distribution Dates for the
      period;

     

    (v)  the
      Pass-Through Rate on the Grantor Trust Certificates for such Distribution Date;
      and

     

    (vi)  the
      interest rate on the Underlying Securities for such Distribution
      Date.

     

    In
      the
      case of the information furnished pursuant to clause (ii) above, the amounts
      shall also be expressed as a dollar amount per $100,000 of principal face
      amount.

     

    The
      Grantor Trust Trustee may make available each month, to any interested party,
      the monthly statement to Grantor Trust Certificateholders via the Grantor Trust
      Trustee’s website initially located at www.ctslink.com.
      Assistance in using the website can be obtained by calling the Grantor Trust
      Trustee’s customer service desk at (866) 846-4526. Parties that are unable to
      use the above distribution option are entitled to have a paper copy mailed
      to
      them via first class mail by calling the Grantor Trust Trustee’s customer
      service desk and indicating such. The Grantor Trust Trustee shall have the
      right
      to change the way such reports are distributed in order to make such
      distribution more convenient and/or more accessible to the parties, and the
      Grantor Trust Trustee shall provide timely and adequate notification to all
      parties regarding any such change.

     

    In
      addition, the Grantor Trust Trustee promptly will furnish to the Depositor,
      and
      upon the written request of a Grantor Trust Certificateholder, to such Grantor
      Trust Certificateholder, copies of any written notices, statements, reports
      or
      other written communications, received by the Grantor Trust Trustee in respect
      of the Underlying Securities.

     

    The
      Grantor Trust Trustee shall be responsible for preparing, at its own expense,
      executing and filing in a timely manner, on behalf of the Trust Fund and for
      the
      Trust Fund as a grantor trust under the Code, federal income tax and information
      returns and reports with the Internal Revenue Service (“IRS”) and income tax and
      information returns and reports of any other state or local taxing authority
      as
      are required to be so filed, using a calendar year as the taxable year of the
      Trust on an accrual basis including the information reportable under the WHFIT
      Regulations as provided below. The Depositor and each Holder of the Grantor
      Trust Certificates shall provide the Grantor Trust Trustee, no later than
      December 31, 2007 (to the extent then ascertainable) and from time to time
      thereafter, all information deemed necessary and requested by the Grantor Trust
      Trustee to fulfill its obligations under this paragraph and the paragraphs
      below. The Grantor Trust Trustee shall furnish to each Grantor Trust
      Certificateholder at the time required by law such information reports or
      returns as are required by applicable federal, state or local law with respect
      to the Trust Fund to enable Grantor Trust Certificateholders to prepare their
      tax returns and will furnish comparable information to the IRS and other taxing
      authorities as and when required by law to do so.

     

    The
      parties hereto and each Holder of a Grantor Trust Certificate, by acceptance
      of
      its interest in such Grantor Trust Certificate, agree to treat the Trust Fund
      as
      a WHFIT that is a NMWHFIT. The Grantor Trust Trustee shall report as required
      under the WHFIT Regulations to the extent such information as is reasonably
      necessary and requested by the Grantor Trust Trustee to enable the Grantor
      Trust
      Trustee to do so is provided to the Grantor Trust Trustee on a timely
      basis.  Each Holder of Grantor Trust Certificates and the Depositor
      shall provide (to the extent known by the Depositor) the Grantor Trust Trustee
      with information identifying any Holders of Grantor Trust Certificates that
      are
“middlemen” as defined by the WHFIT Regulations.  The Grantor Trust
      Trustee shall not be liable for any tax reporting penalties that may arise
      under
      the WHFIT Regulations as a result of the incorrect determination of the status
      of the Trust Fund as a WHFIT.

     

    The
      Grantor Trust Trustee, in its discretion, shall report required WHFIT
      information using either the cash or accrual method, except to the extent the
      WHFIT Regulations specifically require a different method.  The
      Grantor Trust Trustee shall be under no obligation to determine whether a Holder
      of a Grantor Trust Certificate uses the cash or accrual method.  The
      Grantor Trust Trustee shall make available WHFIT information to the Holders
      of
      Grantor Trust Certificates annually in accordance with the WHFIT
      Regulations.  In addition, the Grantor Trust Trustee shall not be
      responsible or liable for providing subsequently amended, revised or updated
      information to any Holder of Grantor Trust Certificates, unless requested by
      any
      such Holder.

     

    The
      Grantor Trust Trustee shall not be liable for failure to meet the reporting
      requirements of the WHFIT Regulations nor for any penalties thereunder if such
      failure is due to: (i) the lack of reasonably necessary information being
      provided to the Grantor Trust Trustee as required in the second preceding
      paragraph, (ii) incomplete, inaccurate or untimely information being provided
      to
      the Grantor Trust Trustee or (iii) the inability of the Grantor Trust Trustee,
      after good faith efforts, to alter its existing information reporting systems
      to
      capture information necessary to fully account for any updates and revisions
      to
      the WHFIT Regulations for the 2007 calendar year.  Each Holder of a
      Grantor Trust Certificate, by acceptance of its interest in such Grantor Trust
      Certificate, shall be deemed to have agreed to provide, and shall so provide,
      the Grantor Trust Trustee with information regarding any sale of such Grantor
      Trust Certificate, including the price, amount of proceeds and date of
      sale.  Absent receipt of such information, and unless informed
      otherwise by the Depositor, the Grantor Trust Trustee will assume there is
      no
      secondary market trading of interests in the Trust Fund for purposes of the
      WHFIT Regulations.

     

    To
      the
      extent required by the WHFIT Regulations, the Grantor Trust Trustee shall
      publish on an appropriate website the CUSIPs for the Grantor Trust
      Certificates.  The Grantor Trust Trustee shall make reasonable good
      faith efforts to keep the website accurate and updated to the extent CUSIPs
      have
      been received.  Absent the receipt of a CUSIP, the Grantor Trust
      Trustee shall use a reasonable identifier number in lieu of such missing
      CUSIP.  The Grantor Trust Trustee shall not be liable for investor
      reporting delays that result from the receipt of inaccurate or untimely CUSIP
      information.

     

    The
      Grantor Trust Trustee shall be entitled to additional reasonable compensation
      for changes in reporting required in respect of the WHFIT Regulations that
      arise
      as a result of a change in the WHFIT Regulations or a change in interpretation
      of the WHFIT Regulations by the IRS or the Depositor or its counsel, in each
      case, following the Closing Date, if such change requires, in the Grantor Trust
      Trustee’s sole discretion, a material increase in the Grantor Trust Trustee’s
      reporting obligations under the WHFIT Regulations in respect of the Trust
      Fund.

     

    Section
      3.07.  Access
      to Certain Documentation and Information.

     

    The
      Grantor Trust Trustee shall provide to the Depositor access to all reports,
      documents and records maintained by the Grantor Trust Trustee in respect of
      its
      duties hereunder, such access being afforded without charge but only upon three
      (3) Business Days’ written request and during normal business hours at offices
      designated by the Grantor Trust Trustee.

     

    Section
      3.08.  Calculation
      of Distribution Amounts.

     

    All
      calculations of Available Funds, the Interest Distribution Amount and amounts
      payable with respect to principal for any Distribution Date shall be performed
      by the Grantor Trust Trustee in reliance on the information provided to it
      in
      the Underlying Distribution Date Statements.

     

    Section
      3.09.  Annual
      Statement as to Compliance.

     

    (a)  The
      Grantor Trust Trustee shall deliver (or otherwise make available) to the
      Depositor not later than March 15th of each calendar year in which a Form 10-K
      is required to be filed for the Trust beginning in 2008, an Officer’s
      Certificate (an “Annual Statement of Compliance”) stating, as to the signatory
      thereof, that (i) a review of the activities of the Grantor Trust Trustee during
      the preceding calendar year and of its performance under this Agreement has
      been
      made under such officer’s supervision and (ii) to the best of such officer’s
      knowledge, based on such review, the Grantor Trust Trustee has fulfilled all
      of
      its obligations under this Agreement in all material respects throughout such
      year or applicable portion thereof, or, if there has been a failure to fulfill
      any such obligation in any material respect, specifying each such failure known
      to such officer and the nature and status of the cure provisions
      thereof.  Such Annual Statement of Compliance shall contain no
      restrictions or limitations on its use.

     

    (b)  Failure
      of the Grantor Trust Trustee to comply with this Section 3.09 (including with
      respect to the timeframes required in this Section) which failure results in
      a
      failure to timely file the related Form 10-K, shall, upon written notice from
      the Depositor, constitute a default, and, in addition to whatever rights the
      Depositor may have under this Agreement and at law or equity or to damages,
      including injunctive relief and specific performance, the Depositor may upon
      notice immediately terminate all of the rights and obligations of the Grantor
      Trust Trustee under this Agreement and in and to the Underlying Securities
      and
      the proceeds thereof without compensating the Grantor Trust Trustee for the
      same
      (but subject to the Grantor Trust Trustee’s right to reimbursement of all
      amounts for which it is entitled to be reimbursed prior to the date of
      termination).  This paragraph shall supersede any other provision in
      this Agreement or any other agreement to the contrary.

     

    Section
      3.10.  Assessments
      of Compliance and Attestation Reports.

     

    Pursuant
      to Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation
      AB,
      the Grantor Trust Trustee (the “Attesting Party”) shall deliver (or otherwise
      make available) to the Depositor on or before March 15th of each calendar year
      in which a report on Form 10-K is required to be filed with the Commission
      with
      respect to the Grantor Trust Certificates, beginning in 2008, a report regarding
      the Attesting Party’s assessment of compliance (an “Assessment of Compliance”)
      with the Servicing Criteria applicable to it during the preceding calendar
      year.  The Assessment of Compliance, as set forth in Regulation AB,
      must contain the following:

     

    (a)           A
      statement by an authorized officer of the Attesting Party of its authority
      and
      responsibility for assessing compliance with the Servicing Criteria applicable
      to the Attesting Party;

     

    (b)           A
      statement by an authorized officer that the Attesting Party used the Servicing
      Criteria identified in Exhibit C hereto to assess compliance with the Servicing
      Criteria applicable to the Attesting Party;

     

    (c)           An
      assessment by such officer of the Attesting Party’s compliance with the
      applicable Servicing Criteria for the period consisting of the preceding
      calendar year, including disclosure of any material instance of noncompliance
      with respect thereto during such period, which assessment shall be based on
      the
      activities the Attesting Party performs with respect to asset-backed securities
      transactions taken as a whole involving the Attesting Party, that are backed
      by
      the same asset type as those backing the Underlying Securities;

     

    (d)           A
      statement that a registered public accounting firm has issued an attestation
      report on the Attesting Party’s Assessment of Compliance for the period
      consisting of the preceding calendar year; and

     

    (e)           A
      statement as to which of the Servicing Criteria, if any, are not applicable
      to
      the Attesting Party, which statement shall be based on the activities the
      Attesting Party performs with respect to asset-backed securities transactions
      taken as a whole involving the Attesting Party, that are backed by the same
      asset type as those backing the Grantor Trust Certificates.

     

    Such
      report at a minimum shall address each of the Servicing Criteria specified
      on
      Exhibit C hereto which are indicated as applicable to the Attesting
      Party.

     

    On
      or
      before March 15th of each calendar year in which a report on Form 10-K is
      required to be filed with the Commission with respect to the Grantor Trust
      Certificates, beginning in 2008, the Attesting Party shall furnish to the
      Depositor a report (an “Attestation Report”) by a registered public accounting
      firm that attests to, and reports on, the Assessment of Compliance made by
      the
      Attesting Party, as required by Rules 13a-18 and 15d-18 of the Exchange Act
      and
      Item 1122(b) of Regulation AB, which Attestation Report must be made in
      accordance with standards for attestation reports issued or adopted by the
      Public Company Accounting Oversight Board.

     

    Each
      party to the Underlying Series that is determined by the Depositor to be
“participating in the servicing function” within the meaning of Item 1122 of
      Regulation AB will be required to provide to the Grantor Trust Trustee and
      the
      Depositor an assessment of compliance and attestation report pursuant to the
      Underlying Agreement. The Depositor, in its capacity as depositor for the
      Underlying Series, shall forward any assessment of compliance and attestation
      report to the Grantor Trust Trustee to the extent not otherwise received by
      the
      Grantor Trust Trustee (pursuant to the Underlying Agreement in its capacity
      as
      master servicer and securities administrator of the Underlying Series) and
      any
      other assessment of compliance and attestation report required to be filed
      under
      the related Form 10-K no later than two Business Days following March 15th in any
      calendar
      year in which a Form 10-K is required to be filed by the Trust. The Depositor
      will identify in writing by no later than January 30th of each
      year for
      which a Form 10-K is required to be filed for the Trust and provide any
      assessment of compliance and attestation report to the Grantor Trust Trustee
      required to be included in any Form 10-K to the extent not otherwise received
      by
      the Grantor Trust Trustee as set forth in the previous sentence and cause such
      assessment of compliance and attestation reports that are required to be
      included in such Form 10-K to be incorporated by reference.

     

    The
      Depositor shall confirm that each Assessment of Compliance delivered to it
      addresses all of the relevant Servicing Criteria and notify the Grantor Trust
      Trustee of any exceptions. Notwithstanding the foregoing, as to any
      subcontractor, an Assessment of Compliance is not required to be delivered
      unless it is required as part of a Form 10-K with respect to the Trust
      Fund.

     

    Failure
      of the Grantor Trust Trustee to comply with this Section 3.10 (including with
      respect to the timeframes required in this Section) which failure results in
      a
      failure to timely file the related Form 10-K, shall, upon written notice from
      the Depositor, constitute a default and the Depositor shall, in addition to
      whatever rights the Depositor may have under this Agreement and at law or equity
      or to damages, including injunctive relief and specific performance, upon notice
      immediately terminate all of the rights and obligations of the Grantor Trust
      Trustee under this Agreement and in and to the Underlying Securities and the
      proceeds thereof without compensating the Grantor Trust Trustee for the same
      (but subject to the Grantor Trust Trustee’s right to reimbursement of all
      amounts for which it is entitled to be reimbursed prior to the date of
      termination).  This paragraph shall supersede any other provision in
      this Agreement or any other agreement to the contrary.

     

    Section
      3.11.  Reports
      Filed with Securities and Exchange Commission.

     

    (a)           (i)
      (A) Within 15 days after each Distribution Date, for so long as the Trust is
      subject to Exchange Act reporting requirements, the Grantor Trust Trustee shall,
      in accordance with industry standards, prepare and file with the Commission
      via
      the Electronic Data Gathering and Retrieval System (“EDGAR”), a Distribution
      Report on Form 10-D, signed by the Depositor, with a copy of the monthly
      statement to be furnished by the Grantor Trust Trustee to the Grantor Trust
      Certificateholders for such Distribution Date pursuant to Section 3.06 hereof,
      including any monthly statement with respect to the Underlying Series, and
      the
      Depositor shall incorporate by reference the related monthly statement included
      in the Form 10-D filed for the Underlying Series; provided that, the Grantor
      Trust Trustee shall have received no later than five (5) calendar days after
      the
      related Distribution Date, all information required to be provided to the
      Grantor Trust Trustee as described in clause (a)(iv) below.  Any
      disclosure that is in addition to the monthly statement and that is required
      to
      be included on Form 10-D, including any information that is otherwise required
      to be provided or incorporated by reference as instructed by the Depositor
      (“Additional Form 10-D Disclosure”), shall be, pursuant to the paragraph (B)
      below, reported by the parties set forth on Exhibit D to the Grantor Trust
      Trustee, or otherwise provided by the Depositor with respect to any information
      required to be provided pursuant to Item 1117 or Item 1119 of Regulation AB,
      and
      the Depositor and approved for inclusion by the Depositor. The Grantor Trust
      Trustee will have no duty or liability for any failure hereunder to determine
      or
      prepare any Additional Form 10-D Disclosure absent such reporting (other than
      in
      the case where the Grantor Trust Trustee is the reporting party as set forth
      in
      Exhibit D) and approval.

     

    Notwithstanding
      anything in this Agreement or the Underlying Agreement to the contrary, the
      Grantor Trust Trustee, as master servicer and securities administrator for
      the
      Underlying Series, shall aggregate and make available to the Depositor all
      information provided pursuant to Item 1121 of Regulation AB with respect to
      the
      Underlying Series for purposes of including such information in each Form 10-D
      that is required to be filed under this Agreement.

     

    (B)
      Within five (5) calendar days after the related Distribution Date, (i) the
      parties set forth in Exhibit D and the parties related to the Underlying Series
      and required to provide information pursuant to the Underlying Agreement shall
      be required to provide, pursuant to Section 3.11(a)(iv) below, to the Grantor
      Trust Trustee and the Depositor, to the extent known by a responsible officer
      thereof, in EDGAR-compatible format, or in such other form as otherwise agreed
      upon by the Grantor Trust Trustee and the Depositor and such party, the form
      and
      substance of any Additional Form 10-D Disclosure, if applicable and (ii) the
      Depositor shall approve, as to form and substance, or disapprove, as the case
      may be, the inclusion of the Additional Form 10-D Disclosure on Form 10-D.
      To
      the extent not otherwise required under the Underlying Agreement, the Depositor
      shall provide to the Grantor Trust Trustee any Additional Form 10-D Disclosure
      (other than any information required under Item 1121 of Regulation AB) for
      any
      servicer or trustee of the Underlying Series. The Depositor shall be responsible
      for any reasonable fees and expenses assessed or incurred by the Grantor Trust
      Trustee in connection with including any Form 10-D Disclosure Information on
      Form 10-D pursuant to this Section.

     

    (C)
      After
      preparing the Form 10-D, the Grantor Trust Trustee shall forward electronically
      a copy of the Form 10-D to the Depositor for review.  Within two (2)
      Business Days after receipt of such copy, but no later than the 12th calendar
      day after the Distribution Date (provided that, the Grantor Trust Trustee
      forwards a copy of the Form 10-D no later than the 10th calendar after the
      Distribution Date), the Depositor shall notify the Grantor Trust Trustee in
      writing (which may be furnished electronically) of any changes to or approval
      of
      such Form 10-D.  In the absence of receipt of any written changes or
      approval, the Grantor Trust Trustee shall be entitled to assume that such Form
      10-D is in final form and the Grantor Trust Trustee may proceed with the filing
      of the Form 10-D.  No later than the 13th calendar day after the
      related Distribution Date, a duly authorized officer of the Depositor shall
      sign
      the Form 10-D and return an electronic or fax copy of such signed Form 10-D
      (with an original executed hard copy to follow by overnight mail) to the Grantor
      Trust Trustee.  If a Form 10-D cannot be filed on time or if a
      previously filed Form 10-D needs to be amended, the Grantor Trust Trustee shall
      follow the procedures set forth in Section 3.11(a)(v). Promptly (but no later
      than one (1) Business Day) after filing with the Commission, the Grantor Trust
      Trustee shall make available on its internet website a final executed copy
      of
      each Form 10-D filed by the Grantor Trust Trustee.  The parties to
      this Agreement acknowledge that the performance by the Grantor Trust Trustee
      of
      its duties under Sections 3.11(a)(i) and (v) related to the timely preparation,
      execution and filing of Form 10-D is contingent upon such parties strictly
      observing all applicable deadlines in the performance of their duties under
      such
      Sections. The Grantor Trust Trustee shall not have any liability for any loss,
      expense, damage, claim arising out of or with respect to any failure to properly
      prepare and timely file such Form 10-D, where such failure results from the
      Grantor Trust Trustee’s inability or failure to receive, on a timely basis, any
      information from any other party hereto needed to prepare, arrange for execution
      or file such Form 10-D, not resulting from its own negligence, bad faith or
      willful misconduct.

     

    Each
      of
      Form 10-D and Form 10-K requires the registrant to indicate (by checking “yes”
or “no”) that it “(1) has filed all reports required to be filed by Section 13
      or 15(d) of the Exchange Act 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.”  The
      Depositor hereby represents to the Grantor Trust Trustee that the Depositor
      has
      filed all such required reports during the preceding twelve (12) months and
      it
      has been subject to such filing requirements for the past 90
      days.  The Depositor shall notify the Grantor Trust Trustee in
      writing, no later than the fifth calendar day after the related Distribution
      Date with respect to the filing of a report on Form 10-D and no later than
      March
      15th with
      respect to the filing of a report on Form 10-K, if the answer to the questions
      should be “no.”  The Grantor Trust Trustee shall be entitled to rely
      on such representations in preparing, executing and/or filing any such
      report.

     

    (ii)
      (A)
      Within four (4) Business Days after the occurrence of an event requiring
      disclosure on Form 8-K (each such event, a “Reportable Event”), for so long as
      the Trust is subject to Exchange Act reporting requirements, the Grantor Trust
      Trustee shall prepare and file, at the direction of the Depositor, on behalf
      of
      the Trust, any Form 8-K, as required by the Exchange Act; provided that, the
      Depositor shall prepare and file the initial Form 8-K in connection with the
      issuance of the Grantor Trust Certificates.  Any disclosure or
      information related to a Reportable Event or that is otherwise required to
      be
      included on Form 8-K, including information as otherwise required to be provided
      or incorporated by reference as instructed by the Depositor (“Form 8-K
      Disclosure Information”), shall be, pursuant to the paragraph immediately below,
      reported by the parties set forth on Exhibit D and the parties related to the
      Underlying Series pursuant to the Underlying Agreement to the Grantor Trust
      Trustee and the Depositor and approved by the Depositor, and the Grantor Trust
      Trustee will have no duty or liability for any failure hereunder to determine
      or
      prepare any Additional Form 8-K Disclosure absent such reporting (other than
      in
      the case where the Grantor Trust Trustee is the reporting party as set forth
      in
      Exhibit D) and approval. To the extent not otherwise required under the
      Underlying Agreement, the Depositor shall provide to the Grantor Trust Trustee,
      by no later than the second (2nd) Business
      Day
      after the Reportable Event, any Additional Form 8-K Disclosure for any servicer
      or trustee of the Underlying Series required to be filed on Form
      8-K.

     

    (B)
      For
      so long as the Trust is subject to the Exchange Act reporting requirements,
      no
      later than the close of business New York City time on the second (2nd) Business
      Day
      after the occurrence of a Reportable Event  (i) the parties set forth
      in Exhibit D and parties related to the Underlying Series and required to
      provide information pursuant to the Underlying Agreement shall be required
      pursuant to Section 3.11(a)(iv) below to provide to the Grantor Trust Trustee
      and the Depositor, to the extent known by a responsible officer thereof, in
      EDGAR-compatible format, or in such other form as otherwise agreed upon by
      the
      Grantor Trust Trustee and the Depositor and such party, the form and substance
      of any Form 8-K Disclosure Information, if applicable, and (ii) the Depositor
      shall approve, as to form and substance, or disapprove, as the case may be,
      the
      inclusion of the Form 8-K Disclosure Information on Form 8-K. The Depositor
      shall be responsible for any reasonable fees and expenses assessed or incurred
      by the Grantor Trust Trustee in connection with including any Form 8-K
      Disclosure Information on Form 8-K pursuant to this Section.

     

    (C)
      After
      preparing the Form 8-K, the Grantor Trust Trustee shall forward electronically
      a
      copy of the Form 8-K to the Depositor for review no later than noon New York
      time on the third (3rd) Business
      Day
      after the Reportable Event.  No later than the close of business New
      York City time on the third (3rd) Business
      Day
      after the Reportable Event, a duly authorized officer of the Depositor shall
      sign the Form 8-K and return an electronic or fax copy of such signed Form
      8-K
      (with an original executed hard copy to follow by overnight mail) to the Grantor
      Trust Trustee.  Promptly, but no later than the close of business on
      the 3rd Business Day after the Reportable Event, the Depositor shall notify
      the
      Grantor Trust Trustee in writing (which may be furnished electronically) of
      any
      changes to or approval of such Form 8-K filed by the Grantor Trust
      Trustee.  In the absence of receipt of any written changes or
      approval, the Grantor Trust Trustee shall be entitled to assume that such Form
      8-K is in final form and the Grantor Trust Trustee may proceed with the filing
      of the Form 8-K.  If a Form 8-K cannot be filed on time or if a
      previously filed Form 8-K needs to be amended, the Grantor Trust Trustee shall
      follow the procedures set forth in Section 3.11(a)(v). Promptly (but no later
      than one (1) Business Day) after filing with the Commission, the Grantor Trust
      Trustee shall make available on its internet website a final executed copy
      of
      each Form 8-K filed by the Grantor Trust Trustee.  The parties to this
      Agreement acknowledge that the performance by the Grantor Trust Trustee of
      its
      duties under this Section 3.11(a)(ii) related to the timely preparation,
      execution and filing of Form 8-K is contingent upon such parties strictly
      observing all applicable deadlines in the performance of their duties under
      this
      Section 3.11(a)(ii).  The Grantor Trust Trustee shall have no
      liability for any loss, expense, damage, claim arising out of or with respect
      to
      any failure to properly prepare, execute and/or timely file such Form 8-K,
      where
      such failure results from the Grantor Trust Trustee’s inability or failure to
      receive, on a timely basis, any information from any other party hereto needed
      to prepare, arrange for execution or file such Form 8-K, not resulting from
      its
      own negligence, bad faith or willful misconduct.

     

    (iii)
      (A)
      Within 90 days after the end of each fiscal year of the Trust or such earlier
      date as may be required by the Exchange Act (the “10-K Filing Deadline”) (it
      being understood that the fiscal year for the Trust ends on December 31st of
      each year), commencing in March 2008 and thereafter so long as the Trust is
      subject to Exchange Act reporting requirements, the Grantor Trust Trustee shall
      prepare and file on behalf of the Trust a Form 10-K, in form and substance
      as
      required by the Exchange Act.  Each such Form 10-K shall include a
      Sarbanes-Oxley Certification as described in Section 3.11 (a)(iii)(D) below
      to
      the extent it has been delivered to the Grantor Trust Trustee within the
      applicable time frame set forth in this Agreement. Any disclosure or information
      in addition to information described in the preceding sentence that is required
      to be included on Form 10-K, including the Form 10-K filed in connection with
      the Underlying Series (“Additional Form 10-K Disclosure”) shall be, pursuant to
      paragraph (B) below, reported by the parties set forth on Exhibit D and parties
      related to the Underlying Series and required to provide information pursuant
      to
      the Underlying Agreement to the Grantor Trust Trustee and the Depositor and
      approved by the Depositor, and the Grantor Trust Trustee will have no duty
      or
      liability for any failure hereunder to determine or prepare any Additional
      Form
      10-K Disclosure absent such reporting (other than in the case where the Grantor
      Trust Trustee is the reporting party as set forth in Exhibit D) and approval.
      Such Form 10-K also shall incorporate by reference the Form 10-Ks filed with
      respect to the Underlying Series.

     

    Notwithstanding
      anything in this Agreement or the Underlying Agreement to the contrary, the
      Grantor Trustee shall aggregate all information provided by the parties related
      to the Underlying Series pursuant to the Underlying Agreement or as otherwise
      required to be provided by the Depositor or incorporated by reference as
      instructed by the Depositor, to the Depositor or the Grantor Trust Trustee,
      and
      shall include such information in any Form 10-K filed pursuant to this Agreement
      to the extent such information is required to be included in such Form 10-K
      and
      is received by the Grantor Trust Trustee.

     

    (B)
      No
      later than March 15th of each year that the Trust is subject to the Exchange
      Act
      reporting requirements, commencing in 2008, (i) the parties set forth in Exhibit
      D and parties related to the Underlying Series and required to provide
      information pursuant to the Underlying Agreement shall be required to provide
      pursuant to Section 3.11(a)(iv) below or the Underlying Agreement to the Grantor
      Trust Trustee and the Depositor, to the extent known by a responsible officer
      thereof, in EDGAR-compatible format, or in such other form as otherwise agreed
      upon by the Grantor Trust Trustee and the Depositor and such party, the form
      and
      substance of any Additional Form 10-K Disclosure, if applicable, and (ii) the
      Depositor will approve, as to form and substance, or disapprove, as the case
      may
      be, the inclusion of the Additional Form 10-K Disclosure on Form
      10-K.  To the extent not otherwise required under the Underlying
      Agreement, the Depositor shall provide to the Grantor Trust Trustee, by no
      later
      than two Business Days after the date specified above, any Additional Form
      10-K
      Disclosure for any Servicer of the Underlying Series. The Depositor shall be
      responsible for any reasonable fees and expenses assessed or incurred by the
      Grantor Trust Trustee in connection with including any Form 10-K Disclosure
      information on Form 10-K pursuant to this Section.

     

    (C)
      After
      preparing the Form 10-K, the Grantor Trust Trustee shall forward electronically
      a copy of the Form 10-K to the Depositor for review.  Within three (3)
      Business Days after receipt of such copy, but no later than March 25th of such
      year, the
      Depositor shall notify the Grantor Trust Trustee in writing (which may be
      furnished electronically) of any changes to or approval of such Form
      10-K.  In the absence of receipt of any written changes or approval,
      the Grantor Trust Trustee shall be entitled to assume that such Form 10-K is
      in
      final form and the Grantor Trust Trustee may proceed with the filing of the
      Form
      10-K.  No later than the close of business New York City time on the
      4th Business Day prior to the 10-K Filing Deadline, a senior officer of the
      Depositor shall sign the Form 10-K and return an electronic or fax copy of
      such
      signed Form 10-K (with an original executed hard copy to follow by overnight
      mail) to the Grantor Trust Trustee.  If a Form 10-K cannot be filed on
      time or if a previously filed Form 10-K needs to be amended, the Grantor Trust
      Trustee will follow the procedures set forth in Section
      3.11(a)(v).  Promptly (but no later than one (1) Business Day) after
      filing with the Commission, the Grantor Trust Trustee shall make available
      on
      its internet website a final executed copy of each Form 10-K filed by the
      Grantor Trust Trustee.  The parties to this Agreement acknowledge that
      the performance by the Grantor Trust Trustee of its duties under Sections
      3.11(a)(iii) and (v) related to the timely preparation, execution and filing
      of
      Form 10-K is contingent upon such parties strictly observing all applicable
      deadlines in the performance of their duties under such Sections and Section
      3.09 and Section 3.10.  The Grantor Trust Trustee shall not have any
      liability for any loss, expense, damage, claim arising out of or with respect
      to
      any failure to properly prepare, execute and/or timely file such Form 10-K,
      where such failure results from the Grantor Trust Trustee’s inability or failure
      to receive, on a timely basis, any information from any other party hereto
      needed to prepare, arrange for execution or file such Form 10-K, not resulting
      from its own negligence, bad faith or willful misconduct.

     

    (D)
      Each
      Form 10-K shall include a certification (the “Sarbanes-Oxley Certification”)
      required to be included therewith in compliance with Item 601(b)(31)(ii) of
      Regulation S-K, which shall be signed by the Certifying Person and delivered
      to
      the Grantor Trust Trustee no later than March 15th of each year in which the
      Trust is subject to the reporting requirements of the Exchange
      Act.  The Grantor Trust Trustee shall provide to the Depositor, as the
      Person who signs the Sarbanes-Oxley Certification (the “Certifying Person”), by
      March 10th of each year in which the Trust is subject to the reporting
      requirements of the Exchange Act and otherwise within a reasonable period of
      time upon request, a certification (a “Back-Up Certification”), in the form
      attached hereto as Exhibit B, upon which the Certifying Person, the entity
      for
      which the Certifying Person acts as an officer, and such entity’s officers,
      directors and Affiliates (collectively with the Certifying Person,
“Certification Parties”) can reasonably rely.  A senior officer of the
      Depositor shall serve as the Certifying Person on behalf of the
      Trust.

     

    (iv)
      With
      respect to any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure
      or any Form 8-K Disclosure Information (collectively, the “Additional
      Disclosure”) relating to the Trust Fund and the Underlying Series, the Grantor
      Trust Trustee’s obligation to include such Additional Information in the
      applicable Exchange Act report is subject to receipt from the entity that is
      indicated in Exhibit D as the responsible party for providing that information,
      if other than the Grantor Trust Trustee, or from the parties to the Underlying
      Series and the Depositor, as and when required as described in Section
      3.11(a)(i) through (iii) above.  Such Additional Disclosure shall be
      accompanied by a notice substantially in the form of Exhibit E.  Each
      of the Sponsor, the Grantor Trust Trustee and the Depositor hereby agrees to
      notify and provide to the extent known to the Sponsor, the Grantor Trust Trustee
      and the Depositor all Additional Disclosure relating to the Trust Fund, with
      respect to which such party is indicated in Exhibit E as the responsible party
      for providing that information. Within five Business Days of each Distribution
      Date of each year that the Trust is subject to the Exchange Act reporting
      requirements, the Depositor shall make available to the Grantor Trust Trustee
      the Significance Estimate and the Grantor Trust Trustee shall use such
      information to calculate the Significance Percentage. The Grantor Trust Trustee
      shall provide the Significance Percentage to the Depositor by the later of
      the
      Distribution Date or three (3) Business Days after the receipt of the
      Significance Estimate from the Depositor. If the Significance Percentage meets
      either of the threshold levels detailed in Item 1115(b)(1) or 1115(b)(2) of
      Regulation AB, the Grantor Trust Trustee shall deliver written notification
      to
      the Depositor and the Yield Maintenance Agreement Counterparty to that effect,
      which notification shall include a request that the Yield Maintenance Agreement
      Counterparty provide Regulation AB information to the Depositor in accordance
      with the Yield Maintenance Agreement.  The Depositor shall be
      obligated to obtain from the Yield Maintenance Agreement Counterparty any
      information required under Regulation AB to the extent required under the Yield
      Maintenance Agreement and to provide to the Grantor Trust Trustee any
      information that may be required to be included in any Form 10-D, Form 8-K
      or
      Form 10-K relating to the Yield Maintenance Agreement Counterparty or written
      notification instructing the Grantor Trust Trustee that such Additional
      Disclosure regarding the Yield Maintenance Agreement Counterparty is not
      necessary for such Distribution Date. The Depositor shall be responsible for
      any
      reasonable fees and expenses assessed or incurred by the Grantor Trust Trustee
      in connection with including any Additional Disclosure information pursuant
      to
      this Section.

     

    So
      long
      as the Depositor is subject to the reporting requirements of the Exchange Act
      with respect to the Trust Fund, the Grantor Trust Trustee shall notify the
      Depositor of any bankruptcy or receivership with respect to the Grantor Trust
      Trustee or of any proceedings of the type described under Item 1117 of
      Regulation AB that have occurred as of the related Due Period, together with
      a
      description thereof, no later than the date on which such information is
      required of other parties hereto as set forth under this Section
      3.11.  In addition, the Grantor Trust Trustee shall notify the
      Depositor of any affiliations or relationships that develop after the Closing
      Date between the Grantor Trust Trustee and the Depositor or the Sponsor of
      the
      type described under Item 1119 of Regulation AB, together with a description
      thereof, no later than the date on which such information is required of other
      parties hereto as set forth under this Section 3.11. Should the identification
      of any of the Depositor or the Sponsor change, the Depositor shall promptly
      notify the Grantor Trust Trustee.

     

    (v)
      (A)
      On or prior to January 30th of the first year in which the Grantor Trust Trustee
      is able to do so under applicable law, the Grantor Trust Trustee shall prepare
      and file a Form 15 relating to the automatic suspension of reporting in respect
      of the Trust under the Exchange Act.

     

    (B)
      In
      the event that the Grantor Trust Trustee is unable to timely file with the
      Commission all or any required portion of any Form 8-K, 10-D or 10-K required
      to
      be filed by this Agreement because required disclosure information was either
      not delivered to it or delivered to it after the delivery deadlines set forth
      in
      this Agreement or for any other reason, the Grantor Trust Trustee shall promptly
      notify the Depositor.  In the case of Form 10-D and 10-K, the
      Depositor and the Grantor Trust Trustee shall cooperate to prepare and file
      a
      Form 12b-25 and a 10-DA and 10-KA as applicable, pursuant to Rule 12b-25 of
      the
      Exchange Act.  In the case of Form 8-K, the Grantor Trust Trustee
      will, upon receipt of all required Form 8-K Disclosure Information and upon
      the
      approval and direction of the Depositor, include such disclosure information
      on
      the next Form 10-D.  In the event that any previously filed Form 8-K,
      10-D or 10-K needs to be amended, and such amendment relates to any Additional
      Disclosure, the Grantor Trust Trustee shall notify the Depositor and the parties
      affected thereby and such parties will cooperate to prepare any necessary Form
      8-K/A, 10-DA or 10-KA.  Any Form 15, Form 12b-25 or any amendment to
      Form 8-K, 10-D or 10-K shall be signed by a duly authorized officer of the
      Depositor.  The parties hereto acknowledge that the performance by the
      Depositor and the Grantor Trust Trustee of their respective duties under this
      Section 3.11(a)(v) related to the timely preparation, execution and filing
      of
      Form 15, a Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K is contingent
      upon the Depositor timely performing its duties under this
      Section.  The Grantor Trust Trustee shall not have any liability for
      any loss, expense, damage, claim arising out of or with respect to any failure
      to properly prepare, execute and/or timely file any such Form 15, Form 12b-25
      or
      any amendments to Form 8-K, 10-D or 10-K, where such failure results from the
      Grantor Trust Trustee’s inability or failure to receive, on a timely basis, any
      information from any other party hereto or to the Underlying Series needed
      to
      prepare, arrange for execution or file such Form 15, Form 12b-25 or any
      amendments to Form 8-K, 10-D or 10-K, not resulting from its own negligence,
      bad
      faith or willful misconduct.

     

    The
      Depositor agrees to promptly furnish to the Grantor Trust Trustee, from time
      to
      time upon request, such further information, reports and financial statements
      within its control related to this Agreement and the Underlying Securities
      as
      the Grantor Trust Trustee reasonably deems appropriate to prepare and file
      all
      necessary reports with the Commission. The Grantor Trust Trustee shall have
      no
      responsibility to file any items other than those specified in this Section
      3.11; provided, however, the Grantor Trust Trustee shall cooperate with the
      Depositor in connection with any additional filings with respect to the Trust
      Fund as the Depositor deems necessary under the Exchange Act.  Fees
      and expenses incurred by the Grantor Trust Trustee in connection with this
      Section 3.11 shall not be reimbursable from the Trust Fund.

     

    (b)           The
      Grantor Trust Trustee shall indemnify and hold harmless the Depositor and each
      of its officers, directors and affiliates from and against any losses, damages,
      penalties, fines, forfeitures, reasonable and necessary legal fees and related
      costs, judgments and other costs and expenses arising out of or based upon
      a
      breach of the Grantor Trust Trustee’s obligations under Sections 3.09, 3.10 and
      3.11 or the Grantor Trust Trustee’s negligence, bad faith or willful misconduct
      in connection therewith. In addition, the Grantor Trust Trustee shall indemnify
      and hold harmless the Depositor and each of its respective officers, directors
      and affiliates from and against any losses, damages, penalties, fines,
      forfeitures, reasonable and necessary legal fees and related costs, judgments
      and other costs and expenses arising out of or based upon (i) any untrue
      statement or alleged untrue statement of any material fact contained in any
      Back-Up Certification, any Annual Statement of Compliance, any Assessment of
      Compliance or any Additional Disclosure provided by the Grantor Trust Trustee
      on
      its behalf pursuant to Section 3.09, 3.10 or 3.11 (the “Grantor Trust Trustee
      Information”), or (ii) any omission or alleged omission to state therein a
      material fact required to be stated therein or necessary to make the statements
      therein, in light of the circumstances in which they were made, not misleading;
      provided, by way of clarification, that this paragraph shall be construed solely
      by reference to the Grantor Trust Trustee Information and not to any other
      information communicated in connection with the Grantor Trust Certificates,
      without regard to whether the Grantor Trust Trustee Information or any portion
      thereof is presented together with or separately from such other
      information.

     

    The
      Depositor shall indemnify and hold harmless the Grantor Trust Trustee and each
      of its officers, directors and affiliates from and against any losses, damages,
      penalties, fines, forfeitures, reasonable and necessary legal fees and related
      costs, judgments and other costs and expenses arising out of or based upon
      a
      breach of the obligations of the Depositor under Sections 3.09, 3.10 and 3.11
      or
      the Depositor’s negligence, bad faith or willful misconduct in connection
      therewith. In addition, the Depositor shall indemnify and hold harmless the
      Grantor Trust Trustee and each of its respective officers, directors and
      affiliates from and against any losses, damages, penalties, fines, forfeitures,
      reasonable and necessary legal fees and related costs, judgments and other
      costs
      and expenses arising out of or based upon (i) any untrue statement or alleged
      untrue statement of any material fact contained in any Additional Disclosure
      provided by the Depositor that is required to be filed pursuant to this Section
      3.11 (the “Depositor Information”), or (ii) any omission or alleged omission to
      state therein a material fact required to be stated therein or necessary to
      make
      the statements therein, in light of the circumstances in which they were made,
      not misleading; provided, by way of clarification, that this paragraph shall
      be
      construed solely by reference to the Depositor Information that is required
      to
      be filed and not to any other information communicated in connection with the
      Grantor Trust Certificates, without regard to whether the Depositor Information
      or any portion thereof is presented together with or separately from such other
      information.

     

    If
      the
      indemnification provided for herein is unavailable or insufficient to hold
      harmless the Depositor or the Grantor Trust Trustee, as applicable, then the
      defaulting party, in connection with any conduct for which it is providing
      indemnification under this Section 3.11(b), agrees that it shall contribute
      to
      the amount paid or payable by the other parties as a result of the losses,
      claims, damages or liabilities of the other party in such proportion as is
      appropriate to reflect the relative fault and the relative benefit of the
      respective parties.

     

    The
      indemnification provisions set forth in this Section 3.11(b) shall survive
      the
      termination of this Agreement or the termination of any party to this
      Agreement.

     

    (c)           Failure
      of the Grantor Trust Trustee to comply with this Section 3.11 (including with
      respect to the time frames required in this Section) which failure results
      in a
      failure to timely file the related Form 10-K, shall, upon written notice from
      the Depositor, constitute a default and the Depositor shall, in addition to
      whatever rights it may have under this Agreement and at law or equity or to
      damages, including injunctive relief and specific performance, upon notice
      immediately terminate all of the rights and obligations of the Grantor Trust
      Trustee under this Agreement and in and to the Underlying Securities and the
      proceeds thereof without compensating the Grantor Trust Trustee for the same
      (but subject to the Grantor Trust Trustee’s right to reimbursement of all
      amounts for which it is entitled to be reimbursed prior to the date of
      termination).  This paragraph shall supersede any other provision in
      this Agreement or any other agreement to the contrary. In connection with the
      termination of the Grantor Trust Trustee pursuant to this Section 3.11(c),
      the
      Grantor Trust Trustee shall be entitled to reimbursement of all costs and
      expenses associated with such termination.  Notwithstanding anything
      to the contrary in this Agreement, no default by the Grantor Trust Trustee
      shall
      have occurred with respect to any failure to properly prepare and/or timely
      file
      any report on Form 8-K, Form 10-D or Form 10-K, any Form 15 or Form 12b-25
      or
      any amendments to Form 8-K, 10-D or 10-K, where such failure results from the
      Grantor Trust Trustee’s inability or failure to receive, on a timely basis, any
      information from any other party hereto needed to prepare, arrange for execution
      or file any such report, Form or amendment, and does not result from its own
      negligence, bad faith or willful misconduct.

     

    (d)           This
      Section 3.11 may be amended without the consent of the Grantor Trust
      Certificateholders.

     

    (e)           Any
      report, notice or notification to be delivered by the Grantor Trust Trustee
      to
      the Depositor pursuant to this Section 3.11, may be delivered via email to
      RegABNotifications@bear.com or, in the case of a notification, telephonically
      by
      calling Reg AB Compliance Manager at (212) 272-7525.

     

    Section
      3.12.  Reserve
      Account

     

    (a)  No
      later
      than the Closing Date, the Grantor Trust Trustee shall establish and maintain
      a
      segregated trust account or a sub-account of a trust account entitled the
“Reserve Account”. The Reserve Account shall be an Eligible Account. On the
      Closing Date, the Grantor Trust Trustee shall, promptly upon receipt, deposit
      in
      the Reserve Account and retain therein the Reserve Account Deposit remitted
      on
      the Closing Date to the Grantor Trust Trustee by the Sponsor. On the Closing
      Date, the Reserve Account shall also include the Yield Maintenance Agreement.
      Funds deposited in the Reserve Account and the Yield Maintenance Agreement
      shall
      be held in trust by the Grantor Trust Trustee for the Grantor Trust
      Certificateholders for the uses and purposes set forth herein. On the Closing
      Date, the portion of the Reserve Account Deposit initially included in the
      Reserve Account Deposit Portion A on such date may be invested in Permitted
      Investments that mature no later than the first Distribution Date, and the
      portion of the Reserve Account Deposit initially included in the Reserve Account
      Deposit Portion B on such date may be invested in Permitted Investments that
      mature no later than the second Distribution Date, in each case as directed
      by
      the Depositor. Any remaining Reserve Account Deposit Portion A following the
      first Distribution Date shall remain uninvested. All income and gain realized
      from investment of the Reserve Account Deposit or portions thereof, which
      investment shall be made solely upon the written direction of the Depositor,
      shall be for the sole and exclusive benefit of the Grantor Trust
      Certificateholders and shall be included in the Reserve Account Distribution
      Amount related to the first and second Distribution Dates. If no written
      direction with respect to such investment is received by the Grantor Trust
      Trustee from the Depositor on the Closing Date, then funds in the Reserve
      Account shall remain uninvested.  The Grantor Trust Trustee shall also
      deposit into the Reserve Account any amounts, if any, received in respect of
      the
      Yield Maintenance Agreement for inclusion in the Reserve Account Distribution
      Amount for the second Distribution Date.

     

    (b)  The
      amounts on deposit in the Reserve Account shall be specifically allocated as
      provided in this Agreement to cover related Interest Distribution Amounts for
      the Grantor Trust Certificates with respect to the first two Distribution Dates
      following the Closing Date. On each of the first two Distribution Dates, the
      Grantor Trust Trustee shall withdraw from the Reserve Account the Reserve
      Account Distribution Amount for such Distribution Date and include such amount
      in the Available Funds for that Distribution Date and distribute such amount
      to
      the Grantor Trust Certificateholders in accordance with Section 3.05. To the
      extent the Reserve Account Deposit Portion B is insufficient to cover the
      Interest Distribution Amount on the second Distribution Date, amounts received
      in respect of the Yield Maintenance Agreement shall be used to cover such
      amount. On the second Distribution Date, any remaining Reserve Account Deposit
      Portion B following distributions on the second Distribution Date shall be
      distributed to the Grantor Trust Certificateholders as provided in Section
      3.05(b). Any payments to the Grantor Trust Certificateholders in respect of
      interest pursuant to this subsection shall not be payments with respect to
      a
“regular interest” in a REMIC within the meaning of Section 860G(a)(1) of
      the Code represented by the Underlying Securities.

     

    Section
      3.13.  The
      Yield Maintenance Agreement

     

    Pursuant
      to the Yield Maintenance Agreement, the Yield Maintenance Agreement Counterparty
      shall remit to the Grantor Trust Trustee amounts sufficient to cover the
      Interest Distribution Amount payable to the Grantor Trust Certificates on the
      second Distribution Date to the extent that the Reserve Account Deposit Portion
      B is insufficient to cover such amount. The Grantor Trustee shall demand payment
      of all money payable by the Yield Maintenance Agreement Counterparty under
      the
      Yield Maintenance Agreement.  The Grantor Trust Trustee shall deposit
      in the Reserve Account all payments received by the Yield Maintenance Agreement
      Counterparty pursuant to the Yield Maintenance Agreement.  On the
      second Distribution Date the Grantor Trust Trustee shall remit amounts received
      from the Yield Maintenance Agreement Counterparty to the Grantor Trust
      Certificateholders in accordance with Section 3.05(a).

     

    In
      the
      event that the Yield Maintenance Agreement Counterparty fails to perform any
      of
      its obligations under the Yield Maintenance Agreement (including, without
      limitation, its obligation to make any payment or transfer collateral), or
      breaches any of its representations and warranties thereunder, or in the event
      that any Event of Default, Termination Event, or Additional Termination Event
      (each as defined in the Yield Maintenance Agreement) occurs with respect to
      the
      Yield Maintenance Agreement, the Grantor Trust Trustee shall, promptly following
      actual notice of such failure, breach or event, notify the Depositor and send
      any notices and make any demands, on behalf of the Trust, required to enforce
      the rights of the Trust under the Yield Maintenance Agreement.

     

    In
      the
      event that the Yield Maintenance Agreement Counterparty’s obligations are
      guaranteed by a third party under a guaranty relating to the Yield Maintenance
      Agreement (such guaranty the “Guaranty” and such third party the “Guarantor”),
      then to the extent that the Yield Maintenance Agreement Counterparty fails
      to
      make any payment by the close of business on the day it is required to make
      payment under the terms of the Yield Maintenance Agreement, the Grantor Trust
      Trustee shall, promptly following actual notice of the Yield Maintenance
      Agreement Counterparty’s failure to pay, demand that the Guarantor make any and
      all payments then required to be made by the Guarantor pursuant to such
      Guaranty.  The Yield Maintenance Agreement Counterparty or the
      Depositor shall promptly provide the Grantor Trust Trustee with a copy of such
      Guaranty; provided, that the Grantor Trust Trustee shall in no event be liable
      for any failure or delay in the performance by the Yield Maintenance Agreement
      Counterparty or any Guarantor of its obligations hereunder or pursuant to the
      Yield Maintenance Agreement and the Guaranty, nor for any special, indirect
      or
      consequential loss or damage of any kind whatsoever (including but not limited
      to lost profits) in connection therewith.

     

    Upon
      an
      early termination of the Yield Maintenance Agreement other than in connection
      with the optional termination of the Trust, the Grantor Trust Trustee, pursuant
      to this Agreement, will use reasonable efforts to appoint a successor yield
      maintenance agreement counterparty selected by the Depositor to enter into
      a new
      yield maintenance agreement on terms substantially similar to the Yield
      Maintenance Agreement, with a successor yield maintenance agreement counterparty
      meeting all applicable eligibility requirements. The Grantor Trust Trustee
      will
      apply any Yield Maintenance Agreement termination payment received from the
      original Yield Maintenance Agreement Counterparty in connection with such early
      termination of the Yield Maintenance Agreement to the upfront payment required
      to appoint the successor yield maintenance agreement counterparty.

     

    If
      the
      Grantor Trust Trustee is unable to appoint a yield maintenance agreement
      counterparty selected by the Depositor within 30 days of the early termination
      of the Yield Maintenance Agreement, then the Grantor Trust Trustee will deposit
      any Yield Maintenance Agreement termination payment received from the original
      Yield Maintenance Agreement Counterparty into a separate, non-interest bearing
      reserve account and will, on each subsequent Distribution Date, withdraw from
      the amount then remaining on deposit in such reserve account an amount equal
      to
      the payment, if any, that would have been paid to the Trustee by the original
      Yield Maintenance Agreement Counterparty calculated in accordance with the
      terms
      of the original Yield Maintenance Agreement, and distribute such amount in
      accordance with the terms of this Agreement.

     

    Section
      3.14.  Yield
      Maintenance Credit Support Annex

     

    The
      Grantor Trust Trustee is hereby directed to perform the obligations of the
      custodian as defined under the Yield Maintenance Credit Support Annex (the
      “Yield Maintenance Custodian”).

     

    On
      or
      before the Closing Date, the Yield Maintenance Custodian  shall
      establish a yield maintenance collateral account (the “Yield Maintenance
      Collateral Account”).  The Yield Maintenance Collateral Account shall
      be held in the name of the Yield Maintenance Custodian in trust for the benefit
      of the Grantor Trust Certificateholders.  The Yield Maintenance
      Collateral Account must be an Eligible Account and shall be entitled “Bear
      Stearns Structured Products Inc. Trust 2007-R3, Grantor Trust Certificates,
      Series 2007-R3, Yield Maintenance Collateral Account, Wells Fargo Bank, National
      Association as Yield Maintenance Custodian for the benefit of holders of Grantor
      Trust Certificates, Series 2007-R3.”

     

    The
      Yield
      Maintenance Custodian  shall credit to Yield Maintenance Collateral
      Account all collateral (whether in the form of cash or securities) posted by
      the
      Yield Maintenance Agreement Counterparty to secure the obligations of the Yield
      Maintenance Agreement Counterparty in accordance with the terms of the Yield
      Maintenance Agreement.  Except for investment earnings, the Yield
      Maintenance Agreement Counterparty shall not have any legal, equitable or
      beneficial interest in the Yield Maintenance Collateral Account other than
      in
      accordance with this Agreement, the Yield Maintenance Agreement and applicable
      law.  The Yield Maintenance Custodian  shall maintain and
      apply all collateral and earnings thereon on deposit in the Yield Maintenance
      Collateral Account in accordance with Yield Maintenance Credit Support
      Annex.

     

    Cash
      collateral posted by the Yield Maintenance Agreement Counterparty in accordance
      with the Yield Maintenance Credit Support Annex shall be invested at the written
      direction of the Yield Maintenance Agreement Counterparty in Permitted
      Investments in accordance with the requirements of the Yield Maintenance Credit
      Support Annex.  In the absence of written direction, cash collateral
      shall remain uninvested. All amounts earned on amounts on deposit in the Yield
      Maintenance Collateral Account (whether cash collateral or securities) shall
      be
      for the account of and taxable to the Yield Maintenance Agreement
      Counterparty.

     

    Upon
      the
      occurrence of an Event of Default or Specified Condition (each as defined in
      the
      Yield Maintenance Agreement) with respect to the Yield Maintenance Agreement
      Counterparty or upon occurrence or designation of an Early Termination Date
      (as
      defined in the Yield Maintenance Agreement) as a result of any such Event of
      Default or Specified Condition with respect to the Yield Maintenance Agreement
      Counterparty, and, in either such case, unless the Yield Maintenance Agreement
      Counterparty has paid in full all of its Obligations (as defined in the Yield
      Maintenance Credit Support Annex) that are then due, then any collateral posted
      by the Yield Maintenance Agreement Counterparty in accordance with the Yield
      Maintenance Credit Support Annex shall be applied to the payment of any
      Obligations due to Party B (as defined in the Yield Maintenance Agreement)
      in
      accordance with the Yield Maintenance Credit Support Annex.  Any
      excess amounts held in such Yield Maintenance Collateral Account after payment
      of all amounts owing to Party B under the Yield Maintenance Agreement shall
      be
      withdrawn from the Yield Maintenance Collateral Account and paid to the Yield
      Maintenance Agreement Counterparty in accordance with the Yield Maintenance
      Credit Support Annex.

     

    ARTICLE
      IV

     

    THE
      GRANTOR TRUST CERTIFICATES

     

    Section
      4.01.  The
      Grantor Trust Certificates.

     

    (a)  The
      Depository, the Depositor and the Grantor Trust Trustee have entered into a
      letter agreement dated as of October 24, 2007 (the “Depository
      Agreement”).  Except as provided in Subsection 4.01(b), the Grantor
      Trust Certificates shall at all times remain registered in the name of the
      Depository or its nominee and at all times:  (i) registration of such
      Grantor Trust Certificates may not be transferred by the Grantor Trust Trustee
      except to a successor to the Depository; (ii) ownership and transfers of
      registration of such Grantor Trust Certificates on the books of the Depository
      shall be governed by applicable rules established by the Depository; (iii)
      the
      Depository may collect its usual and customary fees, charges and expenses from
      its Depository Participants; (iv) the Grantor Trust Trustee shall deal with
      the
      Depository as representative of the Grantor Trust Certificate Owners for
      purposes of exercising the rights of Grantor Trust Certificateholders under
      this
      Agreement, and requests and directions for and votes of such representative
      shall not be deemed to be inconsistent if they are made with respect to
      different Grantor Trust Certificate Owners; and (v) the Grantor Trust Trustee
      may rely and shall be fully protected in relying upon information furnished
      by
      the Depository with respect to its Depository Participants.

     

    All
      transfers by Grantor Trust Certificate Owners of Grantor Trust Certificates
      shall be made in accordance with the procedures established by the Depository
      Participant or brokerage firm representing such Grantor Trust Certificate
      Owners. Each Depository Participant shall only transfer Grantor Trust
      Certificates of Grantor Trust Certificate Owners it represents or of brokerage
      firms for which it acts as agent in accordance with the Depository’s normal
      procedures.

     

    (b)  If
      (i)(A)
      the Depositor advises the Grantor Trust Trustee in writing that the Depository
      is no longer willing or able to properly discharge its responsibilities as
      Depository and (B) the Grantor Trust Trustee or the Depositor is unable to
      locate a qualified successor within 30 days or (ii) after the occurrence and
      continuation of a default hereunder, the Grantor Trust Certificate Owners of
      not
      less than 51% of the Percentage Interests of the Grantor Trust Certificates
      advise the Grantor Trust Trustee and the Depository in writing through the
      depository participants that the continuation of a book-entry system with
      respect to the Grantor Trust Certificates through the Depository (or its
      successor) is no longer in the best interests of the Grantor Trust Certificate
      Owners, then the Grantor Trust Trustee shall request that the Depository notify
      all Grantor Trust Certificate Owners of the occurrence of any such event and
      of
      the availability of definitive, fully registered Grantor Trust Certificates
      (the
“Definitive Grantor Trust Certificates”) to Grantor Trust Certificate Owners
      requesting the same.  Upon surrender to the Grantor Trust Trustee of
      the Grantor Trust Certificates by the Depository, accompanied by registration
      instructions from the Depository for registration, the Grantor Trust Trustee
      shall issue the Definitive Grantor Trust Certificates.  Neither the
      Depositor nor the Grantor Trust Trustee shall be liable for any delay in
      delivery of such instructions and may conclusively rely on, and shall be
      protected in relying on, such instructions.

     

    (c)  The
      Grantor Trust Certificates shall be substantially in the form set forth in
      Exhibit A hereto.  The Grantor Trust Certificates shall be executed by
      manual signature on behalf of the Grantor Trust Trustee in its capacity as
      Grantor Trust Trustee hereunder by an authorized officer.  Grantor
      Trust Certificates bearing the manual or facsimile signatures of individuals
      who
      were at any time the proper officers of the Grantor Trust Trustee shall be
      entitled to all benefits under this Agreement, subject to the following
      sentence, notwithstanding that such individuals or any of them have ceased
      to
      hold such offices prior to the authentication and delivery of such Grantor
      Trust
      Certificates or did not hold such offices at the date of such Grantor Trust
      Certificates.  No Grantor Trust Certificate shall be entitled to any
      benefit under this Agreement, or be valid for any purpose, unless there appears
      on such Grantor Trust Certificate a certificate of authentication substantially
      in the form provided for herein executed by the Grantor Trust Trustee by manual
      signature, and such certificate upon any Grantor Trust Certificate shall be
      conclusive evidence, and the only evidence, that such Grantor Trust Certificate
      has been duly authenticated and delivered hereunder.  All Grantor
      Trust Certificates shall be dated the date of their authentication.

     

    Pending
      the preparation of Definitive Grantor Trust Certificates, the Grantor Trust
      Trustee may sign and authenticate temporary Grantor Trust Certificates that
      are
      printed, lithographed or typewritten, in authorized denominations for Grantor
      Trust Certificates, substantially of the tenor of the Definitive Grantor Trust
      Certificates in lieu of which they are issued and with such appropriate
      insertions, omissions, substitutions and other variations as the officers or
      authorized signatories executing such Grantor Trust Certificates may determine,
      as evidenced by their execution of such Grantor Trust
      Certificates.  If temporary Grantor Trust Certificates are issued, the
      Depositor will cause Definitive Grantor Trust Certificates to be prepared
      without unreasonable delay.  After the preparation of Definitive
      Grantor Trust Certificates, the temporary Grantor Trust Certificates shall
      be
      exchangeable for Definitive Grantor Trust Certificates upon surrender of the
      temporary Grantor Trust Certificates at the office of the Grantor Trust Trustee,
      without charge to the Holder.  Upon surrender for cancellation of any
      one or more temporary Certificates, the Grantor Trust Trustee shall sign and
      the
      Certificate Registrar shall authenticate and deliver in exchange therefor a
      like
      aggregate principal amount, in authorized denominations, of Definitive Grantor
      Trust Certificates.  Until so exchanged, such temporary Grantor Trust
      Certificates shall in all respects be entitled to the same benefits as
      Definitive Grantor Trust Certificates.

     

    Each
      of
      the Grantor Trust Certificates will be initially registered as a single Grantor
      Trust Certificate held by a nominee of the Depository, and beneficial interests
      will be held by investors through the book-entry facilities of the Depository
      in
      minimum denominations of $100,000 and increments of $1 in excess
      thereof.  The Grantor Trust Certificates shall be issued in the
      aggregate dollar denominations as set forth in the following table:

     

    
      	
              
                Class

              

            	
              
                Current
                  Principal
                  Amount

              

            
	
              A-1

               

            	
               $                      24,759,000.00

            

    

     

    

    Section
      4.02.  Registration
      of Transfer and Exchange of Grantor Trust Certificates.

     

    (a)  At
      all
      times during the term of this Agreement, the Grantor Trust Trustee shall
      maintain at its Corporate Trust Office a register (the “Certificate Register”)
      in which, subject to such reasonable regulations as the Grantor Trust Trustee
      may prescribe, the Certificate Register shall provide for the registration
      of
      Grantor Trust Certificates and of transfers and exchanges of Grantor Trust
      Certificates as herein provided.  The Depositor shall have the right
      to inspect the Certificate Register or to obtain a copy thereof at all
      reasonable times, and to rely conclusively upon a certificate of the Grantor
      Trust Trustee as to the information set forth in the Certificate
      Register.

     

    The
      Depositor and every Grantor Trust Certificateholder and Grantor Trust
      Certificate Owner, by receiving and holding a Grantor Trust Certificate or
      an
      interest therein,  agrees with the Grantor Trust Trustee that the
      Grantor Trust Trustee shall not be held accountable by reason of the disclosure
      of any such information as to the names and addresses of the Grantor Trust
      Certificateholders hereunder, regardless of the source from which such
      information was derived.

     

    (b)  Subject
      to the preceding subsection, upon surrender for registration of transfer of
      any
      Grantor Trust Certificate at the Corporate Trust Office of the Grantor Trust
      Trustee, the Grantor Trust Trustee shall execute, authenticate and deliver,
      in
      the name of the designated transferee or transferees, one or more new Grantor
      Trust Certificates of a like aggregate Percentage Interest.

     

    (c)  At
      the
      option of any Holder, its Grantor Trust Certificates may be exchanged for other
      Grantor Trust Certificates of authorized denominations of a like aggregate
      Percentage Interest, upon surrender of the Grantor Trust Certificates to be
      exchanged at the Corporate Trust Office of the Grantor Trust
      Trustee.  Whenever any Grantor Trust Certificates are so surrendered
      for exchange, the Grantor Trust Trustee shall execute, authenticate and deliver
      the Grantor Trust Certificates which the Grantor Trust Certificateholder making
      the exchange is entitled to receive.

     

    (d)  Every
      Grantor Trust Certificate presented or surrendered for transfer or exchange
      shall (if so required by the Grantor Trust Trustee) be duly endorsed by, or
      be
      accompanied by a written instrument of transfer in the form satisfactory to
      the
      Grantor Trust Trustee duly executed by, the Holder thereof or his attorney
      duly
      authorized in writing, and shall further be accompanied by the information
      required to be provided to the Grantor Trust Trustee for WHFIT reporting
      purposes pursuant to Section 3.06 hereof, including the status of the proposed
      transferee as a “middleman” as defined by the WHFIT Regulations and, in the case
      of a transfer pursuant to a sale, the price, the amount of proceeds and the
      date
      of sale of such Grantor Trust Certificate or interest therein.

     

    (e)  No
      service charge shall be made for any transfer or exchange of Grantor Trust
      Certificates, but the Grantor Trust Trustee may require payment of a sum
      sufficient to cover any tax or governmental charge that may be imposed in
      connection with any transfer or exchange of Grantor Trust
      Certificates.

     

    (f)  All
      Grantor Trust Certificates surrendered for transfer and exchange shall be
      destroyed by the Grantor Trust Trustee without liability on its
      part.

     

    Section
      4.03.  Mutilated,
      Destroyed, Lost or Stolen Grantor Trust Certificates.

     

    If
      (i)
      any mutilated Grantor Trust Certificate is surrendered to the Grantor Trust
      Trustee, or the Grantor Trust Trustee receives evidence to its satisfaction
      of
      the destruction, loss or theft of any Grantor Trust Certificate, and (ii)
      (except in the case of a mutilated Grantor Trust Certificate) there is delivered
      to the Grantor Trust Trustee such agreement, security or indemnity as may be
      required by them to save each of them harmless, then, in the absence of notice
      to the Grantor Trust Trustee that such Grantor Trust Certificate has been
      acquired by a bona fide purchaser, the Grantor Trust Trustee shall execute,
      authenticate and deliver, in exchange for or in lieu of any such mutilated,
      destroyed, lost or stolen Grantor Trust Certificate, a new Grantor Trust
      Certificate of like tenor and Percentage Interest but bearing a number not
      contemporaneously outstanding.  Upon the issuance of any new Grantor
      Trust Certificate under this Section, the Grantor Trust Trustee may require
      the
      payment by the Grantor Trust Certificateholder of a sum sufficient to cover
      any
      tax or other governmental charge that may be imposed in relation
      thereto.  Any duplicate Grantor Trust Certificate issued pursuant to
      this Section shall constitute complete and indefeasible evidence of ownership
      in
      the Trust Fund, as if originally issued, whether or not the lost, stolen or
      destroyed Grantor Trust Certificate shall be found at any time.

     

    Section
      4.04.  Persons
      Deemed Owners.

     

    Prior
      to
      due presentment of a Grantor Trust Certificate for registration of transfer,
      the
      Depositor, the Grantor Trust Trustee and any agent of the Depositor or the
      Grantor Trust Trustee may treat the Person in whose name any Grantor Trust
      Certificate is registered as the owner of such Grantor Trust Certificate for
      the
      purpose of receiving distributions pursuant to Section 3.05 and for all other
      purposes whatsoever, and none of the Depositor, the Grantor Trust Trustee,
      or
      any agent of the Depositor or the Grantor Trust Trustee shall be affected by
      notice to the contrary.

     

    ARTICLE
      V

     

    THE
      GRANTOR TRUST TRUSTEE

     

    Section
      5.01.  Duties
      of Grantor Trust Trustee.

     

    (a)  Upon
      receipt of all resolutions, certificates, statements, opinions, reports,
      documents, orders or other instruments which are specifically required to be
      furnished to the Grantor Trust Trustee pursuant to any provision of this
      Agreement, the Grantor Trust Trustee shall examine them to determine whether
      they are in the form required by this Agreement and the Underlying Agreement;
      provided, however, that the Grantor Trust Trustee shall not be responsible
      for
      the accuracy or content of any resolution, certificate, statement, opinion,
      report, document, order or other instrument furnished hereunder; provided,
      further, that the Grantor Trust Trustee shall not be responsible for the
      accuracy or verification of any calculation provided to it pursuant to this
      Agreement.  The Grantor Trust Trustee shall notify the Grantor Trust
      Certificateholders and the Rating Agency of any such documents which do not
      materially conform to the requirements of this Agreement in the event that
      the
      Grantor Trust Trustee, after so requesting of the party required to deliver
      the
      same, does not receive satisfactorily corrected documents or a satisfactory
      explanation regarding any such nonconformities.

     

    The
      Grantor Trust Trustee shall forward or cause to be forwarded or make available,
      as applicable, in a timely fashion the notices, reports and statements required
      to be forwarded by the Grantor Trust Trustee pursuant to Sections 3.01, 3.02,
      3.06 and 7.01.

     

    (b)  No
      provision of this Agreement shall be construed to relieve the Grantor Trust
      Trustee from liability for its own negligent action, its own negligent failure
      to act or its own willful misconduct; provided, however, that:

     

    (i)  The
      duties and obligations of the Grantor Trust Trustee shall be determined solely
      by the express provisions of this Agreement, the Grantor Trust Trustee shall
      not
      be liable except for the performance of its duties and obligations as are
      specifically set forth in this Agreement, no implied covenants or obligations
      shall be read into this Agreement against the Grantor Trust Trustee and, in
      the
      absence of bad faith on the part of the Grantor Trust Trustee, the Grantor
      Trust
      Trustee may conclusively rely, as to the truth of the statements and the
      correctness of the opinions expressed therein, upon any certificates or opinions
      furnished to the Grantor Trust Trustee and conforming to the requirements of
      this Agreement;

     

    (ii)  The
      Grantor Trust Trustee shall not be liable in its individual capacity for an
      error of judgment made in good faith by a Responsible Officer or Responsible
      Officers of the Grantor Trust Trustee unless it shall be proved that the Grantor
      Trust Trustee was negligent in ascertaining the pertinent facts;

     

    (iii)  The
      Grantor Trust Trustee shall not be liable with respect to any action taken,
      suffered or omitted to be taken by it in good faith in accordance with the
      direction of the Majority Grantor Trust Certificateholders in accordance with
      the terms of this Agreement, as to the time, method and place of conducting
      any
      proceeding for any remedy available to the Grantor Trust Trustee, or exercising
      any trust or other power conferred upon the Grantor Trust Trustee under this
      Agreement;

     

    (iv)  The
      Grantor Trust Trustee shall not in any way be liable by reason of any
      insufficiency in any Account held by or in the name of Grantor Trust Trustee
      unless it is determined by a court of competent jurisdiction that the Grantor
      Trust Trustee’s gross negligence or willful misconduct was the primary cause of
      such insufficiency (except to the extent that the Grantor Trust Trustee is
      obligor and has defaulted thereon);

     

    (v)  Anything
      in this Agreement to the contrary notwithstanding, in no event shall the Grantor
      Trust Trustee be liable for special, indirect or consequential loss or damage
      of
      any kind whatsoever (including but not limited to lost profits), even if the
      Grantor Trust Trustee has been advised of the likelihood of such loss or damage
      and regardless of the form of action;

     

    (vi)  Neither
      the Depositor nor the Grantor Trust Trustee shall be responsible for the acts
      or
      omissions of the other, it being understood that this Agreement shall not be
      construed to render them partners, joint venturers or agents of one
      another;

     

    (vii)  The
      Grantor Trust Trustee shall not be required to expend or risk its own funds
      or
      otherwise incur financial liability in the performance of any of its duties
      hereunder, or in the exercise of any of its rights or powers, if there is
      reasonable ground for believing that the repayment of such funds or adequate
      indemnity against such risk or liability is not reasonably assured to it;
      provided that this provision shall not be deemed to abrogate the
      responsibilities undertaken by the Grantor Trust Trustee hereunder to perform
      routine administrative duties in accordance with the terms of this
      Agreement;

     

    (viii)  The
      Grantor Trust Trustee shall not be deemed to have notice of any fact or
      circumstance upon the occurrence of which it may be required to take action
      hereunder unless a Responsible Officer of the Grantor Trust Trustee has actual
      knowledge of such event, fact or circumstance or unless written notice of any
      such event is received by the Grantor Trust Trustee at its Corporate Trust
      Office;

     

    (ix)  No
      provision in this Agreement shall require the Grantor Trust Trustee to expend
      or
      risk its own funds or otherwise incur any personal financial liability in the
      performance of any of its duties as Grantor Trust Trustee hereunder, or in
      the
      exercise of any of its rights or powers, if the Grantor Trust Trustee shall
      have
      reasonable grounds for believing that repayment of funds or adequate indemnity
      against such risk or liability is not reasonably assured to it; provided that
      this provision shall not be deemed to abrogate the responsibilities undertaken
      by the Grantor Trust Trustee hereunder to perform routine administrative duties
      in accordance with the terms hereof; and

     

    (x)  Except
      for those actions that the Grantor Trust Trustee is required to take hereunder,
      the Grantor Trust Trustee shall not have any obligation or liability to take
      any
      action or to refrain from taking any action hereunder in the absence of written
      direction as provided hereunder.

     

    The
      Grantor Trust Trustee is hereby directed to execute and deliver the Yield
      Maintenance Agreement on behalf of Party B (as defined therein) and to exercise
      the rights, perform the obligations, and make the representations of Party
      B
      thereunder, solely in its capacity as Grantor Trust Trustee on behalf of Party
      B
      (as defined therein) and not in its individual capacity.

     

    The
      Sponsor, the Depositor and the Grantor Trust Certificateholders (by acceptance
      of their Grantor Trust Certificates) acknowledge and agree that:

     

    (i)
      the
      Grantor Trust Trustee shall execute and deliver the Yield Maintenance Agreement
      on behalf of Party B (as defined therein), and

     

    (ii)
      the
      Grantor Trust Trustee shall exercise the rights, perform the obligations, and
      make the representations of Party B thereunder, solely in its capacity as
      Grantor Trust Trustee on behalf of Party B (as defined therein) and not in
      its
      individual capacity.

     

    Every
      provision of this Agreement relating to the conduct or affecting the liability
      of or affording protection to the Grantor Trust Trustee shall apply to the
      Grantor Trust Trustee’s  execution  of the Yield Maintenance
      Agreement, and the performance of its duties and satisfaction of its obligations
      thereunder.

     

    Section
      5.02.  Certain
      Matters Affecting the Grantor Trust Trustee.

     

    Except
      as
      otherwise provided in Section 5.01:

     

    (i)  The
      Grantor Trust Trustee may rely and shall be protected in acting or refraining
      from acting in reliance on any resolution, Officer’s Certificate, certificate of
      auditors or any other certificate, statement, instrument, opinion, report,
      notice, request, consent, order, appraisal, bond or other paper or document
      believed by it to be genuine and to have been signed or presented by the proper
      party or parties;

     

    (ii)  The
      Grantor Trust Trustee may consult with counsel and any advice of such counsel
      or
      any Opinion of Counsel shall be full and complete authorization and protection
      with respect to any action taken or suffered or omitted by it hereunder in
      good
      faith and in accordance with such advice or Opinion of Counsel;

     

    (iii)  The
      Grantor Trust Trustee shall not be under any obligation to exercise any of
      the
      trusts or powers vested in it by this Agreement, other than its obligation
      to
      give notices pursuant to this Agreement, or to institute, conduct or defend
      any
      litigation hereunder or in relation hereto at the request, order or direction
      of
      any of the Grantor Trust Certificateholders, pursuant to the provisions of
      this
      Agreement, unless such Grantor Trust Certificateholders shall have offered
      to
      the Grantor Trust Trustee reasonable security or indemnity against the costs,
      expenses and liabilities which may be incurred therein or thereby;

     

    (iv)  The
      Grantor Trust Trustee shall not be liable in its individual capacity for any action taken, suffered
      or
      omitted by it in good faith and believed by it to be authorized or within the
      discretion or rights or powers conferred upon it by this
      Agreement;

     

    (v)  The
      Grantor Trust Trustee shall not be bound to make any investigation into the
      facts or matters stated in any resolution, certificate, statement, instrument,
      opinion, report, notice, request, consent, order, approval, bond or other paper
      or document, but the Grantor Trust Trustee, in its discretion, may make such
      further inquiry or investigation into such facts or matters as it may see fit,
      and, if the Grantor Trust Trustee shall determine to make such further inquiry
      or investigation, it shall be entitled to the extent reasonable under the
      circumstances to examine the books, records and premises of such Person,
      personally or by agent or attorney;

     

    (vi)  The
      Grantor Trust Trustee may execute any of the trusts or powers hereunder or
      perform any duties hereunder either directly or by or through agents or
      attorneys and shall not be liable for the default or misconduct of any such
      agents or attorneys if selected with reasonable care; and

     

    (vii)  The
      right
      of the Grantor Trust Trustee to perform any discretionary act enumerated in
      this
      Agreement shall not be construed as a duty, and the Grantor Trust Trustee shall
      not be accountable for other than its negligence or willful misconduct in the
      performance of any such act.

     

    Section
      5.03.  Grantor
      Trust Trustee Not Liable for Grantor Trust Certificates or Underlying
      Securities.

     

    The
      recitals contained herein and in the Grantor Trust Certificates (other than
      the
      statements attributed to, and the representations and warranties of, the Grantor
      Trust Trustee in Article II and the signature and countersignature of the
      Certificate Registrar on the Grantor Trust Certificates) shall be taken as
      the
      statements of the Depositor, and the Grantor Trust Trustee shall not have any
      responsibility for their correctness. The Grantor Trust Trustee does not makes
      any representation as to the validity or sufficiency of this Agreement (other
      than as specifically set forth in Section 2.03(b)) or of the Grantor Trust
      Certificates (other than that the Grantor Trust Certificates shall be duly
      and
      validly executed and authenticated by it) or of the Underlying Securities or
      any
      related document.  Except as otherwise provided herein, the Grantor
      Trust Trustee shall not be accountable for the use or application by the
      Depositor of any of the Grantor Trust Certificates or of the proceeds of such
      Grantor Trust Certificates, or for the use or application of any funds paid
      to
      the Depositor in respect of the assignment and delivery of the Underlying
      Securities.

     

    Section
      5.04.  Grantor
      Trust Trustee May Own Grantor Trust Certificates.

     

    The
      Grantor Trust Trustee in its individual capacity or in any capacity other than
      as Grantor Trust Trustee hereunder may become the owner or pledgee of any
      Grantor Trust Certificates with the same rights it would have if it were not
      Grantor Trust Trustee and may otherwise deal with the parties
      hereto.

     

    Section
      5.05.  Grantor
      Trust Trustee’s Fees and Expenses.

     

    (a)  The
      Grantor Trust Trustee shall be reimbursed for all expenses and fees incurred
      in
      connection with this agreement by Bear Stearns.

     

    (b)  The
      Grantor Trust Trustee and any director, officer, employee or agent of the
      Grantor Trust Trustee shall be entitled to be indemnified and held harmless
      by
      Bear Stearns against any loss, liability or expense (including, without
      limitation, costs and expenses of litigation, and of investigation, counsel
      fees
      and expenses, damages, judgments, amounts paid in settlement and out-of-pocket
      expenses) arising out of, or incurred in connection with this Agreement, the
      Underlying Agreement, the Underlying Securities and the Grantor Trust
      Certificates, the exercise and performance of any of the powers and duties
      of
      the Grantor Trust Trustee hereunder or thereunder; provided that neither the
      Grantor Trust Trustee nor any of the other above specified Persons shall be
      entitled to indemnification pursuant to this Section 5.05(b) for any loss,
      liability or expense incurred by reason of willful misfeasance, bad faith or
      negligence in the performance of the Grantor Trust Trustee’s obligations and
      duties hereunder, or by reason of reckless disregard of such obligations or
      duties.

     

    The
      provisions of this Section 5.05 shall survive any resignation or removal of
      the
      Grantor Trust Trustee and appointment of a successor Grantor Trust
      Trustee.

     

    Section
      5.06.  Eligibility
      Requirements for Grantor Trust Trustee.

     

    The
      Grantor Trust Trustee and any successor Grantor Trust Trustee shall during
      the
      entire duration of this Agreement be a state bank or trust company or a national
      banking association organized and doing business under the laws of such state
      or
      the United States of America, authorized under such laws to exercise corporate
      trust powers, having a combined capital, and surplus and undivided profits
      of at
      least $50,000,000 (or shall be a member of a bank holding system, the combined
      capital and surplus of which is at least $50,000,000) and subject to supervision
      or examination by federal or state authority. If the Grantor Trust Trustee
      publishes reports of condition at least annually, pursuant to law or to the
      requirements of the aforesaid supervising or examining authority, then for
      the
      purposes of this Section the combined capital and surplus of such corporation
      shall be deemed to be its total equity capital (combined capital and surplus)
      as
      set forth in its most recent report of condition so published.  The
      Grantor Trust Trustee shall at all times meet the requirements of Section
      26(a)(1) of the Investment Company Act and shall in no event be an Affiliate
      of
      the Depositor or of any Person involved in the organization or operation of
      the
      Depositor.   In case at any time the Grantor Trust Trustee shall
      cease to be eligible in accordance with the provisions of this Section, the
      Grantor Trust Trustee shall resign immediately in the manner and with the effect
      specified in Section 5.07.

     

    Section
      5.07.  Resignation
      and Removal of the Grantor Trust Trustee.

     

    (a)  The
      Grantor Trust Trustee may at any time resign and be discharged from the Trust
      hereby created by giving written notice thereof to the Depositor and the Grantor
      Trust Certificateholders. Upon receiving such notice of resignation, the
      Depositor shall promptly appoint a successor Grantor Trust Trustee by written
      instrument, in duplicate, one copy of which instrument shall be delivered to
      each of the resigning Grantor Trust Trustee and the successor Grantor Trust
      Trustee. If no successor Grantor Trust Trustee shall have been so appointed
      and
      have accepted appointment within 30 days after the giving of such notice of
      resignation, the resigning Grantor Trust Trustee may petition any court of
      competent jurisdiction for the appointment of a successor Grantor Trust
      Trustee.

     

    (b)  If
      at any
      time the Grantor Trust Trustee shall cease to be eligible in accordance with
      the
      provisions of Section 5.06 and shall fail to resign after written request
      therefor by the Depositor or the Majority Grantor Trust Certificateholders,
      or
      if at any time the Grantor Trust Trustee shall become incapable of acting,
      or
      shall be adjudged a bankrupt or insolvent, or a receiver of the Grantor Trust
      Trustee or of its property shall be appointed, or any public officer shall
      take
      charge or control of the Grantor Trust Trustee or of its property or affairs
      for
      the purpose of rehabilitation, conservation or liquidation, then the Depositor
      shall promptly remove the Grantor Trust Trustee and appoint a successor Grantor
      Trust Trustee by written instrument, in duplicate, one copy of which instrument
      shall be delivered to each of the Grantor Trust Trustee so removed and one
      copy
      to the successor Grantor Trust Trustee.

     

    (c)  Majority
      Grantor Trust Certificateholders may at any time remove the Grantor Trust
      Trustee and appoint a successor Grantor Trust Trustee by written instrument
      or
      instruments, in quadruplicate, signed by such Holders or their attorneys-in-fact
      duly authorized, one complete set of which instruments shall be delivered to
      the
      Depositor, the Grantor Trust Trustee so removed and the successor so
      appointed.  A copy of such instrument shall be delivered to the
      Grantor Trust Certificateholders by the Depositor.  All reasonable
      out-of-pocket costs and expenses incurred in connection with such removal and
      replacement of the Grantor Trust Trustee, including without limitation,
      reasonable attorneys fees and expenses, shall be borne by the party requesting
      such action.

     

    (d)  No
      resignation or removal of the Grantor Trust Trustee and appointment of a
      successor Grantor Trust Trustee pursuant to any of the provisions of this
      Section shall become effective except upon appointment of and acceptance of
      such
      appointment by the successor Grantor Trust Trustee as provided in Section 5.08
      and (ii) no entity may be appointed as a successor Grantor Trust Trustee if
      such
      appointment would result in a withdrawal or downgrading of any then current
      rating assigned to the Grantor Trust Certificates by the Rating
      Agency.

     

    Section
      5.08.  Successor
      Grantor Trust Trustee.

     

    (a)  Any
      successor Grantor Trust Trustee appointed as provided in Section 5.07 shall
      execute, acknowledge and deliver to the Depositor, the Grantor Trust
      Certificateholders and to its predecessor Grantor Trust Trustee an instrument
      accepting such appointment hereunder. The resignation or removal of the
      predecessor Grantor Trust Trustee shall then become effective and such successor
      Grantor Trust Trustee, without any further act, deed or conveyance, shall become
      fully vested with all the rights, powers, duties and obligations of its
      predecessor hereunder, with like effect as if originally named as Grantor Trust
      Trustee o herein.  The predecessor Grantor Trust Trustee shall after
      payment of its outstanding fees and expenses promptly deliver to the successor
      Grantor Trust Trustee the Underlying Securities and related documents and
      statements held by it hereunder, and the Depositor and the predecessor Grantor
      Trust Trustee shall execute and deliver such instruments and do such other
      things as may reasonably be required for more fully and certainly vesting and
      confirming in the successor Grantor Trust Trustee all such rights, powers,
      duties and obligations.

     

    (b)  No
      successor Grantor Trust Trustee shall accept appointment as provided in this
      Section unless at the time of such acceptance such successor Grantor Trust
      Trustee shall be eligible under the provisions of Section 5.06.

     

    (c)  Upon
      acceptance of appointment by a successor Grantor Trust Trustee as provided
      in
      this Section, the successor Grantor Trust Trustee shall mail notice of the
      succession of such Grantor Trust Trustee hereunder to all Grantor Trust
      Certificateholders at their addresses as shown in the Certificate Register
      and
      to the Rating Agency.  The Depositor shall cause such notice to be
      mailed at the expense of the Depositor.

     

    (d)  Notwithstanding
      anything in this Agreement or the Underlying Agreement to the contrary, in
      the
      event that the paying agent for the Underlying Series resigns or is terminated,
      the Grantor Trust Trustee (if it was such paying agent) shall resign as Grantor
      Trust Trustee under this Agreement and the Depositor may appoint the successor
      paying agent as the successor to the Grantor Trust Trustee
      hereunder.

     

    Section
      5.09.  Merger
      or Consolidation of Grantor Trust Trustee.

     

    Any
      state
      bank or trust company or national banking association into which the Grantor
      Trust Trustee may be merged or converted or with which it may be consolidated
      or
      any state bank or trust company or national banking association resulting from
      any merger, conversion or consolidation to which the Grantor Trust Trustee
      shall
      be a party, or any state bank or trust company or national banking association
      succeeding to all or substantially all of the corporate trust business of the
      Grantor Trust Trusteeshall be the successor of the Grantor Trust Trustee
      hereunder, provided such state bank or trust company or national banking
      association shall be eligible under the provisions of Section 5.06. Such
      succession shall be valid without the execution or filing of any paper or any
      further act on the part of any of the parties hereto, anything herein to the
      contrary notwithstanding.  The Grantor Trust Trustee shall mail notice
      of any such merger or consolidation to the Depositor and to the Grantor Trust
      Certificateholders at their address as shown in the Certificate
      Register.

     

    Section
      5.10.  Appointment
      of Co-Grantor Trust Trustee or Separate Grantor Trust Trustee.

     

    (a)  Notwithstanding
      any other provisions hereof, at any time, for the purpose of meeting any legal
      requirements of any jurisdiction in which any part of the Trust or property
      constituting the same may at the time be located, the Depositor and the Grantor
      Trust Trustee acting jointly shall have the power and shall execute and deliver
      all instruments to appoint one or more Persons approved by the Grantor Trust
      Trustee and the Depositor to act as co-Grantor Trust Trustee or co-Grantor
      Trust
      Trustees, jointly with the Grantor Trust Trustee, or separate Grantor Trust
      Trustee or separate Grantor Trust Trustees, of all or any part of the Trust,
      and
      to vest in such Person or Persons, in such capacity, such title to the Trust,
      or
      any part thereof, and, subject to the other provisions of this Section 5.10,
      such powers, duties, obligations, rights and trusts as the Depositor and the
      Grantor Trust Trustee may consider necessary or desirable.  No
      co-Grantor Trust Trustee or separate Grantor Trust Trustee hereunder shall
      be
      required to meet the terms of eligibility as a successor Grantor Trust Trustee
      under Section 5.06 hereunder; provided, that if the co-Grantor Trust Trustee
      or
      separate Grantor Trust Trustee does not meet such eligibility standards, the
      Grantor Trust Trustee shall remain liable for its actions hereunder, and no
      notice to Grantor Trust Certificateholders of the appointment of co-Grantor
      Trust Trustee(s) or separate Grantor Trust Trustee(s) shall be required under
      Section 5.08 hereof.

     

    (b)  If
      the
      Depositor shall not have joined in such appointment within 15 days after the
      receipt by it of a written request so to do, the Grantor Trust Trustee shall
      have the power to make such appointment without the Depositor.

     

    (c)  In
      the
      case of any appointment of a co-Grantor Trust Trustee or separate Grantor Trust
      Trustee pursuant to this Section 5.10, all rights, powers, duties and
      obligations conferred or imposed upon the Grantor Trust Trustee and required
      to
      be conferred on such co-Grantor Trust Trustee shall be conferred or imposed
      upon
      and exercised or performed jointly by the Grantor Trust Trustee and such
      separate Grantor Trust Trustee or co-Grantor Trust Trustee jointly, except
      to
      the extent that under any law of any jurisdiction in which any particular act
      or
      acts are to be performed (whether as Grantor Trust Trustee hereunder or as
      successor to the Master Servicer hereunder), the Grantor Trust Trustee shall
      be
      incompetent or unqualified to perform such act or acts, in which event such
      rights, powers, duties and obligations (including the holding of title to the
      Trust Fund or any portion thereof in any such jurisdiction) shall be exercised
      and performed by such separate Grantor Trust Trustee or co-Grantor Trust Trustee
      at the direction of the Grantor Trust Trustee.

     

    (d)  Any
      notice, request or other writing
      given to the Grantor Trust Trustee shall be deemed to have been given to each
      of
      the then separate Grantor Trust Trustees and co-Grantor Trust Trustees, as
      effectively as if given to each of them. Every instrument appointing
      any separate
      Grantor Trust Trustee or co-Grantor Trust Trustee shall refer to this Agreement
      and the conditions of this Article V.
Each
      separate Grantor Trust Trustee and
      co-Grantor Trust Trustee, upon its acceptance of the trusts conferred, shall
      be
      vested with the estates or property specified in its instrument of appointment,
      either jointly with the Grantor Trust Trustee or separately, as may be provided
      therein, subject to all the provisions of this Agreement, specifically including
      every provision of this Agreement relating to the conduct of, affecting the
      liability of, or affording protection to, the Grantor Trust Trustee.
Every such instrument
      shall
      be filed with the Grantor Trust Trustee.

     

    (e)  To
      the
      extent not prohibited by law, any separate Grantor Trust Trustee or co-Grantor
      Trust Trustee may, at any time, request the Grantor Trust Trustee, its agent
      or
      attorney-in-fact, with full power and authority, to do any lawful act under
      or
      with respect to this Agreement on its behalf and in its name.  If any
      separate Grantor Trust Trustee or co-Grantor Trust Trustee shall die, become
      incapable of acting, resign or be removed, all of its estates, properties,
      rights, remedies and trusts shall vest in and be exercised by the Grantor Trust
      Trustee, to the extent permitted by law, without the appointment of a new or
      successor Grantor Trust Trustee.

     

    (f)  No
      Grantor Trust Trustee under this Agreement shall be personally liable by reason
      of any act or omission of another Grantor Trust Trustee under this Agreement.
      The Depositor and the Grantor Trust Trustee acting jointly may at any time
      accept the resignation of or remove any separate Grantor Trust Trustee or
      co-Grantor Trust Trustee.

     

    ARTICLE
      VI

     

    THE
      DEPOSITOR

     

    Section
      6.01.  Liability
      of the Depositor.

     

    The
      Depositor shall be liable in accordance herewith only to the extent of the
      respective obligations specifically imposed upon and undertaken by the Depositor
      herein.

     

    Section
      6.02.  Merger,
      Consolidation or Conversion of the Depositor.

     

    Subject
      to the following paragraph, the Depositor will keep in full effect its
      existence, rights and franchises as a corporation under the laws of the
      jurisdiction of its incorporation, and will obtain and preserve its
      qualification to do business as a foreign corporation in each jurisdiction
      in
      which such qualification is or shall be necessary to protect the validity and
      enforceability of this Agreement and the Grantor Trust Certificates and to
      perform its duties under this Agreement.

     

    The
      Depositor may be merged or consolidated with or into any Person, or transfer
      all
      or substantially all of its assets to any Person, in which case any Person
      resulting from any merger or consolidation to which the Depositor shall be
      a
      party, or any Person succeeding to the business of the Depositor, shall be
      the
      successor of the Depositor hereunder, without the execution or filing of any
      paper or any further act on the part of any of the parties hereto, anything
      herein to the contrary notwithstanding.

     

    Section
      6.03.  Limitation
      on Liability of the Depositor and Others.

     

    Neither
      the Depositor nor any of the directors, officers, employees or agents of the
      Depositor shall be under any liability to the Trust Fund or the Grantor Trust
      Certificateholders for any action taken or for refraining from the taking of
      any
      action in good faith pursuant to this Agreement, or for errors in judgment;
      provided, however, that this provision shall not protect the
      Depositor or any such other Person against any breach of a representation or
      warranty made herein, or against any expense or liability specifically required
      to be borne thereby pursuant to the terms hereof, or against any liability
      which
      would otherwise be imposed by reason of willful misfeasance, bad faith or
      negligence in the performance of obligations or duties hereunder, or by reason
      of reckless disregard of such obligations and duties.  The Depositor
      and any director, officer, employee or agent of the Depositor may rely in good
      faith on any document of any kind which, primafacie, is properly
      executed and submitted by any Person respecting any matters arising
      hereunder.  Provided that such action is not related to its
      representations made in or its duties under this Agreement, the Depositor shall
      not be under any obligation to appear in, prosecute or defend any action or
      proceeding unless such action in its opinion does not involve it in any expense
      or liability.

     

    ARTICLE
      VII

     

    TERMINATION

     

    Section
      7.01.  Termination.

     

    (a)  The
      respective obligations and responsibilities of the Depositor and the Grantor
      Trust Trustee created hereby with respect to the Trust Fund (other than the
      obligation to make certain payments and to send certain notices to the Grantor
      Trust Certificateholders as hereinafter set forth) shall terminate upon the
      later of (i) the making of the final payment on or other liquidation of the
      Underlying Securities and (ii) the payment to the Grantor Trust
      Certificateholders of all amounts required to be paid to them pursuant to this
      Agreement; provided, however, that in no event shall the Trust
      Fund created hereby continue beyond the expiration of twenty-one years from
      the
      death of the last survivor of the descendants of Joseph P. Kennedy, the late
      ambassador of the United States to the Court of St. James’s, living on the date
      hereof.

     

    (b)  The
      Grantor Trust Trustee shall, in accordance with Section 8.05, give a Notice
      of
      Final Distribution to the Holders, the Depositor and the Rating Agency as soon
      as practicable of the Distribution Date on which the Grantor Trust Trustee
      anticipates that the final distribution will be made on the Grantor Trust
      Certificates, which notice shall:

     

    (i)  specify
      the Distribution Date on which the final distribution is anticipated to be
      made
      to such Holders;

     

    (ii)  specify
      the amount of any such final distribution, if known; and

     

    (iii)  state
      that the final distribution to such Holders will be made only upon presentment
      and surrender of their Grantor Trust Certificates at the office of the Grantor
      Trust Trustee therein specified.

     

    If
      the
      payment on the Grantor Trust Certificates is not made on the anticipated
      Distribution Date for any reason, the Grantor Trust Trustee shall promptly
      mail
      notice thereof to each such Holder, the Depositor and to the Rating
      Agency.

     

    (c)  Upon
      presentment and surrender of the Grantor Trust Certificates by the Holders
      of
      the Grantor Trust Certificates on the Final Distribution Date, the Grantor
      Trust
      Trustee shall distribute to such Grantor Trust Certificateholders the amounts
      otherwise distributable to them on such Distribution Date pursuant to Section
      3.05(a).  Any funds not distributed on a Final Distribution Date
      because of the failure of any Grantor Trust Certificateholders to tender their
      Grantor Trust Certificates shall be set aside and held in trust for the account
      of the appropriate non-tendering Grantor Trust Certificateholders, and the
      Trust
      Fund shall terminate.  If any Grantor Trust Certificates as to which
      Notice of Final Distribution has been given pursuant to this Section 7.01 shall
      not have been surrendered for cancellation within six months after the time
      specified in such notice, the Grantor Trust Trustee shall mail a second notice
      to the remaining Grantor Trust Certificateholders, at their last addresses
      shown
      in the Certificate Register, to surrender their Grantor Trust Certificates
      for
      cancellation in order to receive, from such funds held, the final distribution
      with respect thereto.  If within one year after the second notice any
      Grantor Trust Certificate shall not have been surrendered for cancellation,
      the
      Grantor Trust Trustee shall directly or through an agent, take reasonable steps
      to contact the remaining Grantor Trust Certificateholders concerning surrender
      of their Grantor Trust Certificates. The costs and expenses of maintaining
      such
      funds and of contacting Grantor Trust Certificateholders shall be paid out
      of
      the assets of the Trust Fund.  If within two years after the second
      notice any Grantor Trust Certificates shall not have been surrendered for
      cancellation, the Grantor Trust Trustee shall segregate all amounts
      distributable to the Holders thereof and shall thereafter hold such amounts
      for
      the benefit of such Holders. No interest shall accrue or be payable to any
      Grantor Trust Certificateholder on any amount held as a result of such Grantor
      Trust Certificateholder’s failure to surrender its Grantor Trust Certificate(s)
      for final payment thereof in accordance with this Section 7.01.

     

    ARTICLE
      VIII

     

    MISCELLANEOUS
      PROVISIONS

     

    Section
      8.01.  Amendment.

     

    (a)  This
      Agreement may be amended from time to time by the Depositor,
      the  Grantor Trust Trustee, without the prior consent of any Grantor
      Trust Certificateholder:

     

    (i)  to
      cure
      any ambiguity;

     

    (ii)  to
      correct or supplement any provisions herein, which may be inconsistent with
      any
      other provisions herein;

     

    (iii)  to
conform
      to the language in the Prospectus
      Supplement;

     

    (iv)  to
      revise any provisions to reflect
      the obligations
      of the parties to this Agreement as they relate to Regulation
      AB;

     

    (v)  to
      make
      any other provisions with respect to matters or questions arising under this
      Agreement which shall not be materially inconsistent with the existing
      provisions of this Agreement; and

     

    (vi)  to
      make
      such modifications as may be permitted or required hereunder in connection
      with
      a repurchase of any Underlying Security pursuant to Section 2.03(c)
      hereof;

     

    provided
      that such amendment shall not, as evidenced by an Opinion of Counsel delivered
      to the Grantor Trust Trustee or a letter from the Rating Agency confirming
      that
      such amendment shall not result in a downgrade or withdrawal of a rating on
      any
      of the Grantor Trust Certificates (in each case, the expense of which shall
      be
      paid for by the Depositor), adversely affect in any material respect the
      interests of any Grantor Trust Certificateholder.

     

    (b)  This
      Agreement may also be amended from time to time by the Depositor and the Grantor
      Trust Trustee with the prior written consent of the Majority Grantor Trust
      Certificateholder for the purpose of adding any provisions to or changing in
      any
      manner or eliminating any of the provisions of this Agreement or of modifying
      in
      any manner the rights of the Grantor Trust Certificateholders; provided,
however, that no such amendment shall:

     

    (i)  reduce
      in
      any manner the amount of, or delay the timing of, payments which are required
      to
      be distributed on any Grantor Trust Certificate without the consent of the
      Holder of such Grantor Trust Certificate; or

     

    (ii)  modify
      the provisions of this Section 8.01 without the consent of the Holders of all
      Grantor Trust Certificates.

     

    Notwithstanding
      any other provision of this Agreement, for the purposes of the giving or
      withholding of consents pursuant to this Section 8.01(b), Grantor Trust
      Certificates registered in the name of, or held for the benefit of, the
      Depositor or any Affiliate thereof shall be entitled to vote their Percentage
      Interests with respect to matters affecting such Grantor Trust
      Certificates.

     

    (c)  Promptly
      after the execution of any such amendment the Grantor Trust Trustee shall
      furnish written notification of the substance of such amendment to each Grantor
      Trust Certificateholder.  It shall not be necessary for the consent of
      the Grantor Trust Certificateholders under this Section 8.01 to approve the
      particular form of any proposed amendment, but it shall be sufficient if such
      consent shall approve the substance thereof.  The manner of obtaining
      such consents and of evidencing the authorization of the execution thereof
      by
      the Grantor Trust Certificateholders shall be subject to such reasonable
      regulations as the Grantor Trust Trustee may prescribe.

     

    (d)  Notwithstanding
      any contrary provision of this Agreement, the Grantor Trust Trustee shall not
      consent to any amendment to this Agreement unless it shall have first received
      an Opinion of Counsel (at the expense of the party seeking such amendment)
      to
      the effect that such amendment or the exercise of any power granted to the
      Depositor or the Grantor Trust Trustee in accordance with such amendment (i)
      is
      authorized or permitted by the Agreement and (ii) will not result in the
      imposition of a tax on the Trust or cause the Trust to fail to be classified
      as
      a grantor trust under subpart E, part I of subchapter J of chapter 1 of the
      Code.

     

    Section
      8.02.  Counterparts.

     

    This
      Agreement may be executed simultaneously in any number of counterparts, each
      of
      which counterparts shall be deemed to be an original, and such counterparts
      shall constitute but one and the same instrument.

     

    Section
      8.03.  Limitation
      on Rights of Grantor Trust Certificateholders.

     

    (a)  The
      death
      or incapacity of any Grantor Trust Certificateholder shall not operate to
      terminate this Agreement or the Trust Fund, nor entitle such Grantor Trust
      Certificateholder’s legal representatives or heirs to claim an accounting or to
      take any action or proceeding in any court for a partition or winding up of
      the
      Trust Fund, nor otherwise affect the rights, obligations and liabilities of
      the
      parties hereto or any of them.

     

    (b)  No
      Grantor Trust Certificateholder shall have any right to vote (except as
      expressly provided for herein) or in any manner otherwise control the operation
      and management of the Trust Fund, or the obligations of the parties hereto,
      nor
      shall anything herein set forth, or contained in the terms of the Grantor Trust
      Certificates, be construed so as to constitute the Grantor Trust
      Certificateholders from time to time as partners or members of an association;
      nor shall any Grantor Trust Certificateholder be under any liability to any
      third party by reason of any action taken by the parties to this Agreement
      pursuant to any provision hereof.

     

    (c)  No
      Grantor Trust Certificateholder shall have any right by virtue of any provision
      of this Agreement to institute any suit, action or proceeding in equity or
      at
      law upon or under or with respect to this Agreement or the Trust Fund, unless
      such Holder previously shall have given to the Grantor Trust Trustee and the
      Depositor a written notice of default hereunder, and of the continuance thereof,
      as hereinbefore provided, and unless also the Majority Grantor Trust
      Certificateholder shall have made written request upon the Grantor Trust Trustee
      to institute such action, suit or proceeding in its own name as Grantor Trust
      Trustee hereunder and shall have offered to the Grantor Trust Trustee such
      reasonable indemnity as it may require against the costs, expenses and
      liabilities to be incurred therein or thereby, and the Grantor Trust Trustee,
      for 30 days after its receipt of such notice, request and offer of indemnity,
      shall have neglected or refused to institute any such action, suit or
      proceeding.  For the prosecution and enforcement of the rights granted
      under this Section, each and every Grantor Trust Certificateholder and the
      Grantor Trust Trustee shall be entitled to such relief as can be given either
      at
      law or in equity.

     

    Section
      8.04.  Governing Law.

     

    This
      Agreement and the Grantor Trust Certificates shall be construed in accordance
      with the laws of the State of New York applicable to agreements made and to
      be
      performed in said state (without reference to the conflicts of law provisions
      of
      such state, other than Sections 5-1401 and 5-1402 of the New York General
      Obligations Laws, which shall apply hereto), and the obligations, rights and
      remedies of the parties hereunder and the Grantor Trust Certificateholders
      shall
      be determined in accordance with such laws.

     

    Section
      8.05.  Notices.

     

    All
      communications provided for or permitted hereunder shall be in writing and
      shall
      be deemed to have been duly given when delivered to: (a) in the case of the
      Depositor, Structured Asset Mortgage Investments II Inc., 383 Madison Avenue,
      New York, New York 10179, or such other address as may hereafter be furnished
      to
      the Grantor Trust Trustee in writing by the Depositor; (b) in the case of the
      Grantor Trust Trustee, to its Corporate Trust Office; and (c) in the case of
      S&P, Standard & Poor’s, 55 Water Street, 41st Floor, New York, New York
      10041 or such other address as may hereafter be furnished to the other parties
      hereto in writing.

     

    Section
      8.06.  Severability of Provisions.

     

    If
      any
      one or more of the covenants, agreements, provisions or terms of this Agreement
      shall be for any reason whatsoever held invalid, then such covenants,
      agreements, provisions or terms shall be deemed severable from the remaining
      covenants, agreements, provisions or terms of this Agreement and shall in no
      way
      affect the validity or enforceability of the other provisions of this Agreement
      or of the Grantor Trust Certificates or the rights of the Holders
      thereof.

     

    Section
      8.07.  Successors
      and Assigns.

     

    The
      provisions of this Agreement shall be binding upon and inure to the benefit
      of
      the respective successors and assigns of the parties hereto, and all such
      provisions shall inure to the benefit of the Grantor Trust
      Certificateholders.

     

    Section
      8.08.  Article
      and Section Headings.

     

    The
      article and section headings herein are for convenience of reference only,
      and
      shall not limit or otherwise affect the meaning hereof.

     

    Section
      8.09.  Notices
      to Rating Agency.

     

    The
      Grantor Trust Trustee shall notify the Rating Agency at such time as it is
      otherwise required pursuant to this Agreement to give notice of the occurrence
      of any of the events described in clauses (a), (b), or (e) below or provide
      a
      copy to the Rating Agency at such time as otherwise required to be delivered
      pursuant to this Agreement of each of the statements described in clauses (c)
      and (e) below:

     

    (a)  a
      material change or amendment to this Agreement,

     

    (b)  the
      termination or appointment of a successor Grantor Trust Trustee or a change
      in
      the majority ownership of the Grantor Trust Trustee,

     

    (c)  the
      monthly distribution statement required to be made available or delivered to
      the
      Grantor Trust Certificateholders pursuant to Section 3.06,

     

    (d)  Notice
      of
      Final Distribution required to be delivered pursuant to Section 7.01(b),
      and

     

    (e)  a
      change
      in the location of the Certificate Account.

     

    The
      Depositor shall notify the Rating Agencies of any change in its
      identity.

     

    Section
      8.10.  Acts
      of Grantor Trust Certificateholders.

     

    (a)    Any
      request, demand, authorization, direction, notice, consent, waiver or other
      action provided by this Agreement to be given or taken by Grantor Trust
      Certificateholders may be embodied in and evidenced by one or more instruments
      of substantially similar tenor signed by such Grantor Trust Certificateholders
      in person or by an agent duly appointed in writing.  Except as herein
      otherwise expressly provided, such action shall become effective when such
      instrument or instruments are delivered to the Grantor Trust Trustee and, where
      it is expressly required, to the Depositor.  Proof of execution of any
      such instrument or of a writing appointing any such agent shall be sufficient
      for any purpose of this Agreement and conclusive in favor of the Grantor Trust
      Trustee and the Depositor, if made in the manner provided in this Section
      8.10.

     

    (b)  The
      fact
      and date of the execution by any Person of any such instrument or writing may
      be
      proved by the affidavit of a witness of such execution or by a certificate
      of a
      notary public or other officer authorized by law to take acknowledgments of
      deeds, certifying that the individual signing such instrument or writing
      acknowledged to him the execution thereof.  Where such execution is by
      a signer acting in a capacity other than his or her individual capacity, such
      certificate or affidavit shall also constitute sufficient proof of his or her
      authority.  The fact and date of the execution of any such instrument
      or writing, or the authority of the individual executing the same, may also
      be
      proved in any other manner which the Grantor Trust Trustee deems
      sufficient.

     

    (c)  The
      ownership of Grantor Trust Certificates (notwithstanding any notation of
      ownership or other writing on such Grantor Trust Certificates, except an
      endorsement in accordance with Section 4.02 made on a Grantor Trust Certificates
      presented in accordance with Section 4.04) shall be proved by the Certificate
      Register, and neither the Grantor Trust Trustee, the Depositor, nor any
      successor to either such party shall be affected by any notice to the
      contrary.

     

    (d)  Any
      request, demand, authorization, direction, notice, consent, waiver or other
      action of the holder of any Grantor Trust Certificate shall bind every future
      holder of the same Grantor Trust Certificate and the holder of every Grantor
      Trust Certificate issued upon the registration of transfer or exchange thereof,
      if applicable, or in lieu thereof with respect to anything done, omitted or
      suffered to be done by the Grantor Trust Trustee, the Depositor, or any
      successor to either such party in reliance thereon, whether or not notation
      of
      such action is made upon such Certificates.

     

    (e)  In
      determining whether the Holders of the requisite Percentage Interest of Grantor
      Trust Certificates have given any request, demand, authorization, direction,
      notice, consent or waiver hereunder, Grantor Trust Certificates owned by the
      Grantor Trust Trustee or the Depositor or any Affiliate thereof shall be
      disregarded, except as otherwise provided in Section 8.01(b), except that,
      in
      determining whether the Grantor Trust Trustee shall be protected in relying
      upon
      any such request, demand, authorization, direction, notice, consent or waiver,
      only Grantor Trust Certificates which the Grantor Trust Trustee knows to be
      so
      owned shall be so disregarded.  Grantor Trust Certificates which have
      been pledged in good faith to the Grantor Trust Trustee or the Depositor or
      any
      Affiliate thereof may be regarded as outstanding if the pledgor establishes
      to
      the satisfaction of the Grantor Trust Trustee the pledgor’s right to act with
      respect to such Grantor Trust Certificates and that the pledgor is not an
      Affiliate of the Grantor Trust Trustee or the Depositor, as the case may
      be.

     

    IN
      WITNESS WHEREOF, the Depositor and the Grantor Trust Trustee have caused their
      names to be signed hereto by their respective duly authorized officers, all
      as
      of the day and year first above written.

     

    
      

      
        	
                STRUCTURED
                  ASSET MORTGAGE INVESTMENTS II INC., as Depositor

              
	 
	 
	
                By:

              	 
	
                Name:

              
	
                Title:

              
	 
	 
	
                WELLS
                  FARGO BANK, N.A., as Grantor Trust Trustee

              
	 
	 
	
                By:

              	 
	
                Name:

              
	
                Title:

              
	 
	 
	 
	 
	 
	 
	 

      

      

      

      
        	
                STATE
                  OF NEW YORK

              	
                )

              	 
	 	 	
                ss.:

              
	
                COUNTY
                  OF NEW YORK

              	
                )

              	 

      

      

      On
        the
        24th day of
        October, 2007 before me, a notary public in and for said State, personally
        appeared _____________________ known to me to be a Vice President of Structured
        Asset Mortgage Investments II Inc., the corporation that executed the within
        instrument, and also known to me to be the person who executed it on behalf
        of
        said corporation, and acknowledged to me that such corporation executed the
        within instrument.

       

      IN
        WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
        the
        day and year in this certificate first above written.

       

      

      
        	 	 	 
	 	
                Notary
                  Public

              	 
	 	 	 
	
                [Notarial
                  Seal]

              	
                Commission
                  Expires:

              	 

      

      

      

      

      
        	
                STATE
                  OF MARYLAND

              	
                )

              	 
	 	 	
                ss.:

              
	
                COUNTY
                  OF HOWARD

              	
                )

              	 

      

      

      On
        the
        24th day of
        October, 2007 before me, a notary public in and for said State, personally
        appeared ____________________________ known to me to be a(n)
        ________________________ of Wells Fargo Bank, N.A., the national banking
        association that executed the within instrument, and also known to me to
        be the
        person who executed it on behalf of said national banking association, and
        acknowledged to me that such national banking association executed the within
        instrument.

       

      IN
        WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal
        the
        day and year in this certificate first above written.

       

      

      
        	 	 	 
	 	
                Notary
                  Public

              	 
	 	 	 
	
                [Notarial
                  Seal]

              	
                Commission
                  Expires:

              	 

      

      

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

      EXHIBIT
        A

       

      FORM
        OF
        GRANTOR TRUST CERTIFICATE

       

      THE
        CURRENT PRINCIPAL AMOUNT OF THIS GRANTOR TRUST CERTIFICATE WILL BE DECREASED
        BY
        THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO. ACCORDINGLY,
        FOLLOWING THE INITIAL ISSUANCE OF THE GRANTOR TRUST CERTIFICATES, THE CURRENT
        PRINCIPAL AMOUNT OF THIS GRANTOR TRUST CERTIFICATE WILL BE DIFFERENT FROM
        THE
        DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS GRANTOR TRUST CERTIFICATE
        MAY
        ASCERTAIN ITS CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE GRANTOR TRUST TRUSTEE
        NAMED HEREIN.

       

      UNLESS
        THIS GRANTOR TRUST CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
        OF
        THE DEPOSITORY TRUST COMPANY TO THE GRANTOR TRUST TRUSTEE OR ITS AGENT FOR
        REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY GRANTOR TRUST CERTIFICATE
        ISSUED WILL BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
        REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY
        AND
        ANY PAYMENT WILL BE MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE
        HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
        REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
        HEREIN.

      

      

      
        	
                Grantor
                  Trust Certificate No. [  ]

              	
                Variable
                  Pass-Through Rate

              
	 	 
	
                Class
                  A-1

              	 
	 	 
	
                Date
                  of Grantor Trust Agreement:

                As
                  of October 24, 2007

              	
                Aggregate
                  Initial Current Principal Amount of all Grantor Trust Certificates
                  of this
                  Class as of the Closing Date:

                $[         ]

              
	 	 
	
                First
                  Distribution Date:

                October
                  25, 2007

              	
                Initial
                  Current Principal Amount of this Grantor Trust Certificate as of
                  the
                  Closing Date:

                $[         ]

              
	 	 
	
                Grantor
                  Trust Trustee:

                Wells
                  Fargo Bank, N.A.

              	
                CUSIP:
                  [         ]

              
	 	 
	
                Assumed
                  Final Distribution Date:

                [_______]

              	 
	 	 

      

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

       

      BEAR
        STEARNS STRUCTURED PRODUCTS INC. TRUST 2007-R3

      GRANTOR
        TRUST CERTIFICATES

      SERIES
        2007-R3

       

      evidencing
        a Percentage Interest in the distributions allocable to the Class A-1 Grantor
        Trust Certificates with respect to a Trust Fund consisting primarily of the
        Underlying Securities sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II
        INC.

       

      This
        Grantor Trust Certificate is payable solely from the assets of the Trust
        Fund,
        and does not represent an obligation of or interest in Structured Asset Mortgage
        Investments II Inc., the Grantor Trust Trustee referred to below or any of
        their
        affiliates or any other person. Neither this Grantor Trust Certificate nor
        the
        Underlying Securities are guaranteed or insured by any governmental entity
        or by
        Structured Asset Mortgage Investments II Inc., the Grantor Trust Trustee
        or any
        of their affiliates or any other person. None of Structured Asset Mortgage
        Investments II Inc., the Grantor Trust Trustee or any of their affiliates
        will
        have any obligation with respect to any certificate or other obligation secured
        by or payable from payments on the Grantor Trust Certificates.

       

      This
        certifies that Cede & Co. is the registered owner of the Percentage Interest
        evidenced hereby in the beneficial ownership interest of Grantor Trust
        Certificates of the same Class as this Grantor Trust Certificate in a trust
        (the
“Trust Fund”) primarily consisting of the Underlying Securities sold by
        Structured Asset Mortgage Investments II Inc. (“SAMI II”). The Underlying
        Securities were sold by EMC Mortgage Corporation (“EMC”) to SAMI
        II.  The Trust Fund was created pursuant to the Grantor Trust
        Agreement, dated as of the Closing Date, (the “Agreement”), between SAMI II, as
        depositor (the “Depositor”) and Wells Fargo Bank, N.A., as grantor trust trustee
        (the “Grantor Trust Trustee”), a summary of certain of the pertinent provisions
        of which is set forth hereafter. To the extent not defined herein, capitalized
        terms used herein shall have the meaning ascribed to them in the Agreement.
        This
        Grantor Trust Certificate is issued under and is subject to the terms,
        provisions and conditions of the Agreement, to which Agreement the Holder
        of
        this Grantor Trust Certificate by virtue of its acceptance hereof assents
        and by
        which such Holder is bound.

       

        Interest
        on this Grantor Trust Certificate will accrue from and including the 25th
        day
        (or with respect to the First Distribution Date, the Closing Date) of the
        calendar month preceding the month in which a Distribution Date (as hereinafter
        defined) occurs to and including the 24th day of the calendar month in which
        that Distribution Date occurs (or with respect to the First Distribution
        Date,
        to but not including October 25, 2007) on the Current Principal Amount hereof
        at
        a per annum rate equal to the Pass-Through Rate as described in the
        Agreement.  The Grantor Trust Trustee will distribute on the
        Underlying Security Distribution Date of each month (each, a “Distribution
        Date”) to the Person in whose name this Grantor Trust Certificate is registered
        at the close of business on the last Business Day of the calendar month
        preceding the month of such Distribution Date (or with respect to the First
        Distribution Date, the Closing Date), an amount equal to the product of
        Percentage Interest evidenced by this Grantor Trust Certificate and the amount
        (of interest and principal, if any) required to be distributed to the Holders
        of
        Grantor Trust Certificates of the same Class as this Grantor Trust Certificate,
        commencing on the First Distribution Date specified above. The Underlying
        Security Distribution Date is the 25th day of each month, or, if such 25th
        day
        is not a Business Day, the immediately following Business Day.

       

      Distributions
        on this Grantor Trust Certificate will be made by the Grantor Trust Trustee
        by
        check mailed to the address of the Person entitled thereto as such name and
        address shall appear on the Certificate Register or, if such Person so requests
        by notifying the Grantor Trust Trustee in writing as specified in the Agreement,
        by wire transfer. Notwithstanding the above, the final distribution on this
        Grantor Trust Certificate will be made after due notice by the Grantor Trust
        Trustee of the pendency of such distribution and only upon presentation and
        surrender of this Grantor Trust Certificate at the office or agency appointed
        by
        the Grantor Trust Trustee for that purpose and designated in such notice.
        The
        Initial Current Principal Amount of this Grantor Trust Certificate is set
        forth
        above. The Current Principal Amount hereof will be reduced to the extent
        of
        distributions allocable to principal hereon and any Realized Losses allocable
        hereto.

       

      This
        Grantor Trust Certificate is one of a duly authorized issue of Grantor Trust
        Certificates designated as set forth on the face hereof (the “Grantor Trust
        Certificates”), issued in one Class. The Grantor Trust Certificates evidence the
        entire beneficial ownership interest in the Trust Fund formed pursuant to
        the
        Agreement.

       

      The
        Grantor Trust Certificateholder, by its acceptance of this Grantor Trust
        Certificate, agrees that it will look solely to the Trust Fund for payment
        hereunder and that none of the Depositor or the Grantor Trust Trustee are
        liable
        to the Grantor Trust Certificateholders for any amount payable under this
        Grantor Trust Certificate or the Agreement or, except as expressly provided
        in
        the Agreement, subject to any liability under the Agreement.

       

      This
        Grantor Trust Certificate does not purport to summarize the Agreement and
        reference is made to the Agreement for the interests, rights and limitations
        of
        rights, benefits, obligations and duties evidenced hereby, and the rights,
        duties and immunities of the Grantor Trust Trustee.

       

      The
        Agreement permits, with certain exceptions therein provided, the amendment
        thereof and the modification of the rights and obligations of the Depositor
        and
        the Grantor Trust Trustee and the rights of the Grantor Trust Certificateholders
        related to the Trust Fund under the Agreement from time to time by the parties
        thereto with the consent of the Holders of the Grantor Trust Certificates,
        evidencing Percentage Interests aggregating not less than 51% of the Grantor
        Trust Certificates (or in certain cases, Holders of the Grantor Trust
        Certificates of affected Classes evidencing such percentage of the Percentage
        Interests thereof). Any such consent by the Holder of this Grantor Trust
        Certificate shall be conclusive and binding on such Holder and upon all future
        Holders of this Grantor Trust Certificate and of any Grantor Trust Certificate
        issued upon the transfer hereof or in lieu hereof whether or not notation
        of
        such consent is made upon this Grantor Trust Certificate. The Agreement also
        permits the amendment thereof, in certain limited circumstances, without
        the
        consent of the Holders of any of the Grantor Trust Certificates.

       

      As
        provided in the Agreement and subject to certain limitations therein set
        forth,
        the transfer of this Grantor Trust Certificate is registrable with the Grantor
        Trust Trustee upon surrender of this Grantor Trust Certificate for registration
        of transfer at the offices or agencies maintained by the Grantor Trust Trustee
        for such purposes, duly endorsed by, or accompanied by a written instrument
        of
        transfer in form satisfactory to the Grantor Trust Trustee duly executed
        by the
        Holder hereof or such Holder’s attorney duly authorized in writing, and
        accompanied by the information required to be provided to the Grantor Trust
        Trustee for WHFIT reporting purposes as described in the Agreement, and
        thereupon one or more new Grantor Trust Certificates in authorized denominations
        representing a like aggregate Percentage Interest will be issued to the
        designated transferee.

       

      The
        Grantor Trust Certificates are issuable only as registered Grantor Trust
        Certificates without coupons in the Classes and denominations specified in
        the
        Agreement. As provided in the Agreement and subject to certain limitations
        therein set forth, this Grantor Trust Certificate is exchangeable for one
        or
        more new Grantor Trust Certificates evidencing the same Class and in the
        same
        aggregate Percentage Interest, as requested by the Holder surrendering the
        same.

       

      No
        service charge will be made to the Grantor Trust Certificateholders for any
        such
        registration of transfer, but the Grantor Trust Trustee may require payment
        of a
        sum sufficient to cover any tax or other governmental charge payable in
        connection therewith. The Depositor, Grantor Trust Trustee and any agent
        of any
        of them may treat the Person in whose name this Certificate is registered
        as the
        owner hereof for all purposes, and none of the Depositor, the Grantor Trust
        Trustee or any such agent shall be affected by notice to the
        contrary.

       

      The
        obligations created by the Agreement and the Trust Fund created thereby (other
        than the obligations to make payments to Grantor Trust Certificateholders
        with
        respect to the termination of the Agreement related to the Trust Fund) shall
        terminate upon the later of (i) the making of the final payment on or other
        liquidation of the Underlying Securities, or (ii) the payment to the Grantor
        Trust Certificateholders of all amounts required to be paid to them pursuant
        to
        the Agreement. In no event, however, will the Trust Fund created by the
        Agreement continue beyond the expiration of 21 years after the death of certain
        persons identified in the Agreement.

       

      Unless
        this Grantor Trust Certificate has been countersigned by an authorized signatory
        of the Grantor Trust Trustee by manual signature, this Grantor Trust Certificate
        shall not be entitled to any benefit under the Agreement, or be valid for
        any
        purpose.

       

      

       

      IN
        WITNESS WHEREOF, the Grantor Trust Trustee has caused this Certificate to
        be
        duly executed.

       

      Dated:
        October 24, 2007

      

      
        	
                WELLS
                  FARGO BANK, N.A.,

                not
                  in its individual capacity but solely as Grantor Trust
                  Trustee

                 

                 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

      

      

      CERTIFICATE
        OF AUTHENTICATION

      

      This
        is one of the Class A-1 Grantor
        Trust Certificates referred to in the within-mentioned Agreement.

      

      
        	
                WELLS
                  FARGO BANK, N.A.,

                Authorized
                  signatory of Wells Fargo Bank, N.A., not in its individual capacity
                  but
                  solely as Grantor Trust Trustee

                 

                 

              
	 	 
	
                By:

              	 
	 	
                Authorized
                  Signatory

              

      

       

       

       

       

       

      
 

      ASSIGNMENT

       

      FOR
        VALUE
        RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
        __________________________________ (Please print or typewrite name and address
        including postal zip code of assignee) a Percentage Interest evidenced by
        the
        within Grantor Trust Certificate and hereby authorizes the transfer of
        registration of such interest to assignee on the Certificate Register of
        the
        Trust Fund.

       

      I
        (We)
        further direct the Grantor Trust Trustee to issue a new Grantor Trust
        Certificate of a like denomination and Class, to the above named assignee
        and
        deliver such Grantor Trust Certificate to the following address:

       

      
        	 
	 

      

      

       

      

      
        	
                Dated:

              	 	 
	 	
                Signature
                  by or on behalf of assignor

              	 
	 	 	 
	 	 	 
	 	
                Signature
                  Guaranteed

              	 

      

      

      

      

      

      DISTRIBUTION
        INSTRUCTIONS

      

      The
        assignee should include the following for purposes of distribution:

       

      Distributions
        shall be made, by wire transfer or otherwise, in immediately available funds
        to
        _________________________________ for the account of _________________________
        account number _____________, or, if mailed by check, to
        ______________________________. Applicable statements should be mailed to
        _____________________________________________.

       

      This
        information is provided
        by                                                                __________________,
        the assignee named above, or ________________________, as its
        agent.

       

       

       

      
 

      EXHIBIT
        B

       

      FORM
        OF
        CERTIFICATION TO BE

      PROVIDED
        BY THE GRANTOR TRUST TRUSTEE TO DEPOSITOR

      

      Re:           ________________________________
        Trust 200_-____(the “Trust”), Grantor Trust Certificates, Series
        200_-____, issued pursuant to the Grantor Trust Agreement, dated as of ________,
        200_ (the “Agreement” or “Trust Agreement”), between Structured Asset Mortgage
        Investments II Inc., as Depositor and Wells Fargo Bank, National Association,
        as
        Grantor Trust Trustee

       

      The
        Grantor Trust Trustee hereby certifies to the Depositor, and its officers,
        directors and affiliates, and with the knowledge and intent that they will
        rely
        upon this certification, that:

       

        1.           I
        have reviewed the annual report on Form 10-K for the fiscal year [____] (the
        “Annual Report”), and all reports on Form 10-D required to be filed in
        respect of the period covered by the Annual Report (collectively with the
        Annual
        Report, the “Reports”), of the Trust;

       

        2.           To
        my knowledge, (a) the Reports, taken as a whole, do not contain any untrue
        statement of a material fact or omit to state a material fact necessary to
        make
        the statements made, in light of the circumstances under which such statements
        were made, not misleading with respect to the period covered by the Annual
        Report, and (b) the Grantor Trust Trustee’s assessment of compliance and related
        attestation report referred to below, taken as a whole, do not contain any
        untrue statement of a material fact or omit to state a material fact necessary
        to make the statements made, in light of the circumstances under which such
        statements were made, not misleading with respect to the period covered by
        such
        assessment of compliance and attestation report;

       

        3.           To
        my knowledge, the distribution information required to be provided by the
        Grantor Trust Trustee under the Trust Agreement for inclusion in the Reports
        is
        included in the Reports;

       

        4.           I
        am responsible for reviewing the activities performed by the Grantor Trust
        Trustee under the Trust Agreement, and based on my knowledge and the compliance
        review conducted in preparing the compliance statement of the Grantor Trust
        Trustee required by the Trust Agreement, and except as disclosed in the Reports,
        the Grantor Trust Trustee has fulfilled its obligations under the Trust
        Agreement in all material respects; and

       

        5.           The
        report on assessment of compliance with servicing criteria applicable to
        the
        Grantor Trust Trustee for asset-backed securities of the Grantor Trust Trustee
        and each Subcontractor utilized by the Grantor Trust Trustee and related
        attestation report on assessment of compliance with servicing criteria
        applicable to it required to be included in the Annual Report in accordance
        with
        Item 1122 of Regulation AB and Exchange Act Rules 13a-18 and 15d-18 has been
        included as an exhibit to the Annual Report.  Any material instances
        of non-compliance are described in such report and have been disclosed in
        the
        Annual Report.

       

      In
        giving
        the certifications above, the Grantor Trust Trustee has reasonably relied
        on
        information provided to it by the following unaffiliated
        parties:  [names of servicer(s), master servicer, subservicer,
        depositor, Grantor Trust Trustee, custodian(s)]

       

      

      Date:________________________________

      

      

      _____________________________________

      [Signature]

      [Title]

      

       

      

      EXHIBIT
        C

       

      SERVICING
        CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

       

      Definitions

      Grantor
        Trust Trustee – waterfall calculator

      Grantor
        Trust Trustee – fiduciary of the transaction

       

      Note:  The
        definitions above describe the essential function that the party performs,
        rather than the party’s title.  So, for example, in a particular
        transaction, the Grantor Trust Trustee may perform the “paying agent” and
“securities administrator” functions, while in another transaction, the
        securities administrator may perform these functions.

       

      Where
        there are multiple checks for criteria the attesting party will identify
        in
        their management assertion that they are attesting only to the portion of
        the
        distribution chain they are responsible for in the related transaction
        agreements.

       

      Key:                      X
        – obligation

      

       

      
        	
                Reg
                  AB Reference

              	
                Servicing
                  Criteria

              	
                Grantor
                  Trust Trustee

              
	 	
                General
                  Servicing Considerations

              	 
	
                1122(d)(1)(i)

              	
                Policies
                  and procedures are instituted to monitor any performance or other
                  triggers
                  and events of default in accordance with the transaction
                  agreements.

              	
                X

              
	
                1122(d)(1)(ii)

              	
                If
                  any material servicing activities are outsourced to third parties,
                  policies and procedures are instituted to monitor the third party’s
                  performance and compliance with such servicing activities.

              	
                X

              
	
                1122(d)(1)(iii)

              	
                Any
                  requirements in the transaction agreements to maintain a back-up
                  servicer
                  for the Pool Assets are maintained.

              	 
	
                1122(d)(1)(iv)

              	
                A
                  fidelity bond and errors and omissions policy is in effect on the
                  party
                  participating in the servicing function throughout the reporting
                  period in
                  the amount of coverage required by and otherwise in accordance
                  with the
                  terms of the transaction agreements.

              	 
	 	
                Cash
                  Collection and Administration

              	 
	
                1122(d)(2)(i)

              	
                Payments
                  on pool assets are deposited into the appropriate custodial bank
                  accounts
                  and related bank clearing accounts no more than two business days
                  following receipt, or such other number of days specified in the
                  transaction agreements.

              	
                X

              
	
                1122(d)(2)(ii)

              	
                Disbursements
                  made via wire transfer on behalf of an obligor or to an investor
                  are made
                  only by authorized personnel.

              	
                X

              
	
                1122(d)(2)(iii)

              	
                Advances
                  of funds or guarantees regarding collections, cash flows or distributions,
                  and any interest or other fees charged for such advances, are made,
                  reviewed and approved as specified in the transaction
                  agreements.

              	
                X

              
	
                1122(d)(2)(iv)

              	
                The
                  related accounts for the transaction, such as cash reserve accounts
                  or
                  accounts established as a form of over collateralization, are separately
                  maintained (e.g., with respect to commingling of cash) as set forth
                  in the
                  transaction agreements.

              	
                X

              
	
                1122(d)(2)(v)

              	
                Each
                  custodial account is maintained at a federally insured depository
                  institution as set forth in the transaction agreements. For purposes
                  of
                  this criterion, “federally insured depository institution” with respect to
                  a foreign financial institution means a foreign financial institution
                  that
                  meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
                  Act.

              	
                X

              
	
                1122(d)(2)(vi)

              	
                Unissued
                  checks are safeguarded so as to prevent unauthorized
                  access.

              	
                X

              
	
                1122(d)(2)(vii)

              	
                Reconciliations
                  are prepared on a monthly basis for all asset-backed securities
                  related
                  bank accounts, including custodial accounts and related bank clearing
                  accounts. These reconciliations are (A) mathematically accurate;
                  (B)
                  prepared within 30 calendar days after the bank statement cutoff
                  date, or
                  such other number of days specified in the transaction agreements;
                  (C)
                  reviewed and approved by someone other than the person who prepared
                  the
                  reconciliation; and (D) contain explanations for reconciling items.
                  These
                  reconciling items are resolved within 90 calendar days of their
                  original
                  identification, or such other number of days specified in the transaction
                  agreements.

              	
                X

              
	 	
                Investor
                  Remittances and Reporting

              	 
	
                1122(d)(3)(i)

              	
                Reports
                  to investors, including those to be filed with the Commission,
                  are
                  maintained in accordance with the transaction agreements and applicable
                  Commission requirements. Specifically, such reports (A) are prepared
                  in
                  accordance with timeframes and other terms set forth in the transaction
                  agreements; (B) provide information calculated in accordance with
                  the
                  terms specified in the transaction agreements; (C) are filed with
                  the
                  Commission as required by its rules and regulations; and (D) agree
                  with
                  investors’ or the trustee’s records as to the total unpaid principal
                  balance and number of Pool Assets serviced by the
                  Servicer.

              	
                X

              
	
                1122(d)(3)(ii)

              	
                Amounts
                  due to investors are allocated and remitted in accordance with
                  timeframes,
                  distribution priority and other terms set forth in the transaction
                  agreements.

              	
                X

              
	
                1122(d)(3)(iii)

              	
                Disbursements
                  made to an investor are posted within two business days to the
                  Servicer’s
                  investor records, or such other number of days specified in the
                  transaction agreements.

              	
                X

              
	
                1122(d)(3)(iv)

              	
                Amounts
                  remitted to investors per the investor reports agree with cancelled
                  checks, or other form of payment, or custodial bank
                  statements.

              	
                X

              
	 	
                Pool
                  Asset Administration

              	 
	
                1122(d)(4)(i)

              	
                Collateral
                  or security on pool assets is maintained as required by the transaction
                  agreements or related pool asset documents.

              	 
	
                1122(d)(4)(ii)

              	
                Pool
                  assets and related documents are safeguarded as required by the
                  transaction agreements

              	 
	
                1122(d)(4)(iii)

              	
                Any
                  additions, removals or substitutions to the asset pool are made,
                  reviewed
                  and approved in accordance with any conditions or requirements
                  in the
                  transaction agreements.

              	 
	
                1122(d)(4)(iv)

              	
                Payments
                  on pool assets, including any payoffs, made in accordance with
                  the related
                  pool asset documents are posted to the Servicer’s obligor records
                  maintained no more than two business days after receipt, or such
                  other
                  number of days specified in the transaction agreements, and allocated
                  to
                  principal, interest or other items (e.g., escrow) in accordance
                  with the
                  related pool asset documents.

              	 
	
                1122(d)(4)(v)

              	
                The
                  Servicer’s records regarding the pool assets agree with the Servicer’s
                  records with respect to an obligor’s unpaid principal
                  balance.

              	 
	
                1122(d)(4)(vi)

              	
                Changes
                  with respect to the terms or status of an obligor's pool assets
                  (e.g.,
                  loan modifications or re-agings) are made, reviewed and approved
                  by
                  authorized personnel in accordance with the transaction agreements
                  and
                  related pool asset documents.

              	 
	
                1122(d)(4)(vii)

              	
                Loss
                  mitigation or recovery actions (e.g., forbearance plans, modifications
                  and
                  deeds in lieu of foreclosure, foreclosures and repossessions, as
                  applicable) are initiated, conducted and concluded in accordance
                  with the
                  timeframes or other requirements established by the transaction
                  agreements.

              	 
	
                1122(d)(4)(viii)

              	
                Records
                  documenting collection efforts are maintained during the period
                  a pool
                  asset is delinquent in accordance with the transaction agreements.
                  Such
                  records are maintained on at least a monthly basis, or such other
                  period
                  specified in the transaction agreements, and describe the entity’s
                  activities in monitoring delinquent pool assets including, for
                  example,
                  phone calls, letters and payment rescheduling plans in cases where
                  delinquency is deemed temporary (e.g., illness or
                  unemployment).

              	 
	
                1122(d)(4)(ix)

              	
                Adjustments
                  to interest rates or rates of return for pool assets with variable
                  rates
                  are computed based on the related pool asset documents.

              	 
	
                1122(d)(4)(x)

              	
                Regarding
                  any funds held in trust for an obligor (such as escrow accounts):
                  (A) such
                  funds are analyzed, in accordance with the obligor’s pool asset documents,
                  on at least an annual basis, or such other period specified in
                  the
                  transaction agreements; (B) interest on such funds is paid, or
                  credited,
                  to obligors in accordance with applicable pool asset documents
                  and state
                  laws; and (C) such funds are returned to the obligor within 30
                  calendar
                  days of full repayment of the related pool assets, or such other
                  number of
                  days specified in the transaction agreements.

              	 
	
                1122(d)(4)(xi)

              	
                Payments
                  made on behalf of an obligor (such as tax or insurance payments)
                  are made
                  on or before the related penalty or expiration dates, as indicated
                  on the
                  appropriate bills or notices for such payments, provided that such
                  support
                  has been received by the servicer at least 30 calendar days prior
                  to these
                  dates, or such other number of days specified in the transaction
                  agreements.

              	 
	
                1122(d)(4)(xii)

              	
                Any
                  late payment penalties in connection with any payment to be made
                  on behalf
                  of an obligor are paid from the Servicer’s funds and not charged to the
                  obligor, unless the late payment was due to the obligor’s error or
                  omission.

              	 
	
                1122(d)(4)(xiii)

              	
                Disbursements
                  made on behalf of an obligor are posted within two business days
                  to the
                  obligor’s records maintained by the servicer, or such other number of days
                  specified in the transaction agreements.

              	 
	
                1122(d)(4)(xiv)

              	
                Delinquencies,
                  charge-offs and uncollectible accounts are recognized and recorded
                  in
                  accordance with the transaction agreements.

              	 
	
                1122(d)(4)(xv)

              	
                Any
                  external enhancement or other support, identified in Item 1114(a)(1)
                  through (3) or Item 1115 of Regulation AB, is maintained as set
                  forth in
                  the transaction agreements.  (In this transaction there is no
                  external enhancement or other support.)

              	 

      

      

       

       

       

      EXHIBIT
        D

       

      FORM
        10-D, FORM 8-K AND FORM 10-K REPORTING RESPONSIBILITY

       

      As
        to
        each item described below, the entity indicated as the Responsible Party
        shall
        be primarily responsible for reporting the information to the party identified
        as responsible for preparing the Securities Exchange Act Reports pursuant
        to
        Section 3.11 of the Grantor Trust Agreement.

       

      Under
        Item 1 of Form 10-D: a) items marked “Monthly Statement to Grantor Trust
        Certificateholders” are required to be included in the periodic Distribution
        Date statement under Section 3.06, provided by the Grantor Trust Trustee
        based
        on information received from the party providing such information; and b)
        items
        marked “Form 10-D report” are required to be in the Form 10-D report but not the
        Monthly Statements to Grantor Trust Certificateholders, provided by the party
        indicated.  Information under all other Items of Form 10-D is to be
        included in the Form 10-D report.  All such information and any other
        Items on Form 8-K and Form 10-D set forth in this Exhibit shall be sent to
        the
        Grantor Trust Trustee and the Depositor.

       

       

        
          	
                  Form

                	
                  Item

                	
                  Description

                	
                  Grantor
                    Trust Trustee

                	
                  Depositor

                	
                  Sponsor

                	 
	
                  10-D

                	
                  Must
                    be filed within 15 days of the distribution date for the asset-backed
                    securities.

                	 	 	 
	
                  1

                	
                  Distribution
                    and Pool Performance Information

                	 	 	 	 
	
                  Item
                    1121(a) – Distribution and Pool Performance
                    Information

                	 	 	 	 
	
                  (1)
                    Any applicable record dates, accrual dates, determination dates
                    for
                    calculating distributions and actual distribution dates for the
                    distribution period.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (2)
                    Cash flows received and the sources thereof for distributions,
                    fees and
                    expenses.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (3)
                    Calculated amounts and distribution of the flow of funds for
                    the period
                    itemized by type and priority of payment, including:

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (i)
                    Fees or expenses accrued and
                    paid, with an identification of the general purpose of such fees
                    and the
                    party receiving such fees or expenses.

                	 	 	 	 
	
                  (ii)
                    Payments accrued or paid
                    with respect to enhancement or other support identified in Item
                    1114 of
                    Regulation AB (such as insurance premiums or other enhancement
                    maintenance
                    fees), with an identification of the general purpose of such
                    payments and
                    the party receiving such payments.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (iii)
                    Principal, interest and
                    other distributions accrued and paid on the asset-backed securities
                    by
                    type and by class or series and any principal or interest shortfalls
                    or
                    carryovers.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (iv)
                    The amount of excess cash
                    flow or excess spread and the disposition of excess cash
                    flow.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (4)
                    Beginning and ending principal balances of the asset-backed
                    securities.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (5)
                    Interest rates applicable to the pool assets and the asset-backed
                    securities, as applicable. Consider providing interest rate information
                    for pool assets in appropriate distributional groups or incremental
                    ranges.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (6)
                    Beginning and ending balances of transaction accounts, such as
                    reserve
                    accounts, and material account activity during the period.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (7)
                    Any amounts drawn on any credit enhancement or other support
                    identified in
                    Item 1114 of Regulation AB, as applicable, and the amount of
                    coverage
                    remaining under any such enhancement, if known and
                    applicable.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (8)
                    Number and amount of pool assets at the beginning and ending
                    of each
                    period, and updated pool composition information, such as weighted
                    average
                    coupon, weighted average remaining term, pool factors and prepayment
                    amounts.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                   

                	
                  Updated
                    pool composition information fields to be as specified by Depositor
                    from
                    time to time

                	 	 
	
                  (9)
                    Delinquency and loss information for the period.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  In
                    addition, describe any material changes to the information specified
                    in
                    Item 1100(b)(5) of Regulation AB regarding the pool assets.
                    (methodology)

                	 	 	 	 
	
                  (10)
                    Information on the amount, terms and general purpose of any advances
                    made
                    or reimbursed during the period, including the general use of
                    funds
                    advanced and the general source of funds for
                    reimbursements.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (11)
                    Any material modifications, extensions or waivers to pool asset
                    terms,
                    fees, penalties or payments during the distribution period or
                    that have
                    cumulatively become material over time.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (12)
                    Material breaches of pool asset representations or warranties
                    or
                    transaction covenants.

                	
                  X

                   

                  (if
                    agreed upon by the parties)

                	
                  X

                	 	 
	
                  (13)
                    Information on ratio, coverage or other tests used for determining
                    any
                    early amortization, liquidation or other performance trigger
                    and whether
                    the trigger was met.

                	
                  X

                   

                  (Monthly
                    Statements to Grantor Trust Certificateholders)

                	 	 	 
	
                  (14)
                    Information regarding any new issuance of asset-backed securities
                    backed
                    by the same asset pool,

                	 	
                  X

                	 	 
	
                  information
                    regarding any pool asset changes (other than in connection with
                    a pool
                    asset converting into cash in accordance with its terms), such
                    as
                    additions or removals in connection with a prefunding or revolving
                    period
                    and pool asset substitutions and repurchases (and purchase rates,
                    if
                    applicable), and cash flows available for future purchases, such
                    as the
                    balances of any prefunding or revolving accounts, if
                    applicable.

                	
                  X

                	
                  X

                	 	 
	
                  Disclose
                    any material changes in the solicitation, credit-granting, underwriting,
                    origination, acquisition or pool selection criteria or procedures,
                    as
                    applicable, used to originate, acquire or select the new pool
                    assets.

                	 	
                  X

                	
                  X

                	 
	
                  Item
                    1121(b) – Pre-Funding or Revolving Period Information

                   

                  Updated
                    pool information as required under Item 1121(b).

                	 	
                  X

                	 	 
	
                  2

                	
                  Legal
                    Proceedings

                	 	 	 	 
	
                  Item
                    1117 – Legal proceedings pending against the following entities, or
                    their
                    respective property, that is material to Grantor Trust Certificateholders,
                    including proceedings known to be contemplated by governmental
                    authorities:

                	 	 	 	 
	
                  Sponsor
                    (Seller)

                	 	 	
                  X

                	 
	
                  Depositor

                	 	
                  X

                	 	 
	
                  Grantor
                    Trust Trustee

                	
                  X

                   

                	 	 	 
	
                  Issuing
                    entity

                	 	
                  X

                	 	 
	
                  Master
                    Servicer, affiliated Servicer, other Servicer servicing 20% or
                    more of
                    pool assets at time of report, other material servicers

                	
                  N/A

                	 	 	 
	
                  Securities
                    Administrator

                	
                  N/A

                	 	 	 
	
                  Originator
                    of 20% or more of pool assets as of the Cut-off Date

                	 	
                  X

                	 	 
	
                  Custodian

                	
                  N/A

                	 	 	 
	
                  3

                	
                  Sales
                    of Securities and Use of Proceeds

                	 	 	 	 
	
                  Information
                    from Item 2(a) of Part II of Form 10-Q:

                   

                  With
                    respect to any sale of securities by the sponsor, depositor or
                    issuing
                    entity, that are backed by the same asset pool or are otherwise
                    issued by
                    the issuing entity, whether or not registered, provide the sales
                    and use
                    of proceeds information in Item 701 of Regulation S-K.  Pricing
                    information can be omitted if securities were not
                    registered.

                	 	
                  X

                	 	 
	
                  4

                	
                  Defaults
                    Upon Senior Securities

                	 	 	 	 
	
                  Information
                    from Item 3 of Part II of Form 10-Q:

                   

                  Report
                    the occurrence of any Event of Default (after expiration of any
                    grace
                    period and provision of any required notice)

                	
                  X

                	 	 	 
	
                  5

                	
                  Submission
                    of Matters to a Vote of Security Holders

                	 	 	 	 
	
                  Information
                    from Item 4 of Part II of Form 10-Q

                	
                  X

                	 	 	 
	
                  6

                	
                  Significant
                    Obligors of Pool Assets

                	 	 	 	 
	
                  Item
                    1112(b) –Significant Obligor Financial
                    Information*

                	 	
                  X

                	 	 
	
                  *This
                    information need only be reported on the Form 10-D for the distribution
                    period in which updated information is required pursuant to the
                    Item.

                	 	 	 	 
	
                  7

                	
                  Significant
                    Enhancement Provider Information

                	 	 	 	 
	
                  Item
                    1114(b)(2) – Credit Enhancement Provider Financial
                    Information*

                	 	 	 	 
	
                  Determining
                    applicable disclosure threshold

                	 	 	 	 
	
                  Requesting
                    required financial information or effecting incorporation by
                    reference

                	 	 	 	 
	
                  Item
                    1115(b) – Derivative Counterparty Financial
                    Information*

                	 	 	 	 
	
                  Determining
                    current maximum probable exposure

                	 	
                  X

                	 	 
	
                  Determining
                    current significance percentage

                	 	 	 	 
	
                  Requesting
                    required financial information or effecting incorporation by
                    reference

                	 	 	 	 
	
                  *This
                    information need only be reported on the Form 10-D for the distribution
                    period in which updated information is required pursuant to the
                    Items.

                	 	 	 	 
	
                  8

                	
                  Other
                    Information

                	 	 	 	 
	
                  Disclose
                    any information required to be reported on Form 8-K during the
                    period
                    covered by the Form 10-D but not reported

                	
                  The
                    Responsible Party for the applicable Form 8-K item as indicated
                    below.

                	 
	
                  9

                	
                  Exhibits

                	 	 	 
	
                  Distribution
                    report

                	
                  X

                	 	 	 
	
                  Exhibits
                    required by Item 601 of Regulation S-K, such as material
                    agreements

                	 	
                  X

                	 	 
	
                  8-K

                	
                  Must
                    be filed within four business days of an event reportable on
                    Form
                    8-K.

                	 
	
                  1.01

                	
                  Entry
                    into a Material Definitive Agreement

                	 	 	 	 
	
                  Disclosure
                    is required regarding entry into or amendment of any definitive
                    agreement
                    that is material to the securitization, even if depositor is
                    not a
                    party.

                   

                  Examples:
                    servicing agreement, custodial agreement.

                   

                  Note:
                    disclosure not required as to definitive agreements that are
                    fully
                    disclosed in the prospectus

                	
                  X

                	
                  X

                	
                  X

                	 
	
                  1.02

                	
                  Termination
                    of a Material Definitive Agreement

                	
                  X

                	
                  X

                	
                  X

                	 
	
                  Disclosure
                    is required regarding termination of  any definitive agreement
                    that is material to the securitization (other than expiration
                    in
                    accordance with its terms), even if depositor is not a party.

                   

                  Examples:
                    servicing agreement, custodial agreement.

                	 	 	 	 
	
                  1.03

                	
                  Bankruptcy
                    or Receivership

                	 	 	 	 
	
                  Disclosure
                    is required regarding the bankruptcy or receivership, if known,
                    with
                    respect to any of the following:

                   

                  Sponsor
                    (Seller), Depositor, Master Servicer, affiliated Servicer, other
                    Servicer
                    servicing 20% or more of pool assets at time of report, other
                    material
                    servicers, Certificate Administrator, Grantor Trust Trustee,
                    significant
                    obligor, credit enhancer (10% or more), derivatives counterparty,
                    Custodian

                	
                  X

                	
                  X

                	
                  X

                	 
	
                  2.04

                	
                  Triggering
                    Events that Accelerate or Increase a Direct Financial Obligation
                    or an
                    Obligation under an Off-Balance Sheet Arrangement

                	 	 	 	 
	
                  Includes
                    an early amortization, performance trigger or other event, including
                    event
                    of default, that would materially alter the payment priority/distribution
                    of cash flows/amortization schedule.

                   

                  Disclosure
                    will be made of events other than waterfall triggers which are
                    disclosed
                    in the Monthly Statement to Grantor Trust
                    Certificateholders

                	
                  X

                	 	 	 
	
                  3.03

                	
                  Material
                    Modification to Rights of Security Holders

                	 	 	 	 
	
                  Disclosure
                    is required of any material modification to documents defining
                    the rights
                    of Grantor Trust Certificateholders, including the Pooling and
                    Servicing
                    Agreement

                	
                  X

                	
                  X

                	 	 
	
                  5.03

                	
                  Amendments
                    to Articles of Incorporation or Bylaws; Change in Fiscal
                    Year

                	 	 	 	 
	
                  Disclosure
                    is required of any amendment “to the governing documents of the issuing
                    entity”

                	 	
                  X

                	 	 
	
                  5.06

                	
                  Change
                    in Shell Company Status

                	 	 	 	 
	
                  [Not
                    applicable to ABS issuers]

                	 	
                  X

                	 	 
	
                  6.01

                	
                  ABS
                    Informational and Computational Material

                	 	 	 	 
	
                  [Not
                    included in reports to be filed under Section 3.18]

                	 	
                  X

                	 	 
	
                  6.02

                	
                  Change
                    of Servicer or Grantor Trust Trustee

                	 	 	 	 
	
                  Requires
                    disclosure of any removal, replacement, substitution or addition
                    of any
                    master servicer, affiliated servicer, other servicer servicing
                    10% or more
                    of pool assets at time of report, other material servicers, certificate
                    administrator or Grantor Trust Trustee.

                	
                  X

                	
                  X

                   

                	 	 
	 	
                  Reg
                    AB disclosure about any new servicer is also required.

                	
                  N/A

                	 	 	 
	
                  Reg
                    AB disclosure about any new Grantor Trust Trustee is also
                    required.

                	
                  X

                  (to
                    the extent of a new Grantor Trust Trustee)

                	 	 	 
	
                  Reg
                    AB disclosure about any new securities administrator is also
                    required.

                	
                  N/A

                	 	 	 
	
                  6.03

                	
                  Change
                    in Credit Enhancement or Other External Support In this transaction
                    there
                    is no external enhancement or other support.

                	 	 	 	 
	
                  Covers
                    termination of any enhancement in manner other than by its terms,
                    the
                    addition of an enhancement, or a material change in the enhancement
                    provided.  Applies to external credit enhancements as well as
                    derivatives.

                	 	
                  X

                	 	 
	 	
                  Reg
                    AB disclosure about any new enhancement provider is also
                    required.

                	 	
                  X

                	 	 
	
                  6.04

                	
                  Failure
                    to Make a Required Distribution

                	
                  X

                	 	 	 
	
                  6.05

                	
                  Securities
                    Act Updating Disclosure

                	 	 	 	 
	
                  If
                    any material pool characteristic differs by 5% or more at the
                    time of
                    issuance of the securities from the description in the final
                    prospectus,
                    provide updated Reg AB disclosure about the actual asset
                    pool.

                	 	
                  X

                	 	 
	
                  If
                    there are any new servicers or originators required to be disclosed
                    under
                    Regulation AB as a result of the foregoing, provide the information
                    called
                    for in Items 1108 and 1110 respectively.

                	 	
                  X

                	 	 
	
                  7.01

                	
                  Regulation
                    FD Disclosure

                	
                  X

                	
                  X

                	 	 
	
                  8.01

                	
                  Other
                    Events

                	 	 	 	 
	
                  Any
                    event, with respect to which information is not otherwise called
                    for in
                    Form 8-K, that the registrant deems of importance to security
                    holders.

                	 	
                  X

                	 	 
	
                  9.01

                	
                  Financial
                    Statements and Exhibits

                	
                  The
                    Responsible Party applicable to reportable event.

                	 
	
                  10-K

                	
                  Must
                    be filed within 90 days of the fiscal year end for the
                    registrant.

                	 
	
                  9B

                	
                  Other
                    Information

                	 	 	 	 
	 	 	
                  Disclose
                    any information required to be reported on Form 8-K during the
                    fourth
                    quarter covered by the Form 10-K but not reported

                	
                  The
                    Responsible Party for the applicable Form 8-K item as indicated
                    above.

                	 
	 	
                  15

                	
                  Exhibits
                    and Financial Statement Schedules

                	 	 	 	 
	
                  Item
                    1112(b) –Significant Obligor Financial
                    Information

                	 	
                  X

                	 	 
	
                  Item
                    1114(b)(2) – Credit Enhancement Provider Financial
                    Information

                	 	 	 	 
	
                  Determining
                    applicable disclosure threshold

                	 	 	 	 
	
                  Requesting
                    required financial information or effecting incorporation by
                    reference

                	 	 	 	 
	
                  Item
                    1115(b) – Derivative Counterparty Financial
                    Information

                	 	 	 	 
	
                  Determining
                    current maximum probable exposure

                	 	
                  X

                	 	 
	 	 	
                  Determining
                    current significance percentage

                	 	 	 	 
	
                  Requesting
                    required financial information or effecting incorporation by
                    reference

                	 	 	 	 
	
                  Item
                    1117 – Legal proceedings pending against the following entities, or
                    their
                    respective property, that is material to Grantor Trust Certificateholders,
                    including proceedings known to be contemplated by governmental
                    authorities:

                	 	 	 	 
	
                  Sponsor
                    (Seller)

                	 	 	
                  X

                	 
	
                  Depositor

                	 	
                  X

                	 	 
	
                  Grantor
                    Trust Trustee

                	
                  X

                	 	 	 
	
                  Issuing
                    entity

                	 	
                  X

                	 	 
	
                  Master
                    Servicer, affiliated Servicer, other Servicer servicing 20% or
                    more of
                    pool assets at time of report, other material servicers

                	
                  N/A

                	 	 	 
	
                  Securities
                    Administrator

                	
                  N/A

                	 	 	 
	
                  Originator
                    of 20% or more of pool assets as of the Cut-off Date

                	 	
                  X

                	 	 
	
                  Custodian

                	
                  N/A

                	 	 	 
	
                  Item
                    1119 – Affiliations and relationships between the following entities,
                    or
                    their respective affiliates, that are material to Grantor Trust
                    Certificateholders:

                	 	 	 	 
	
                  Sponsor
                    (Seller)

                	 	 	
                  X

                	 
	
                  Depositor

                	 	
                  X

                	 	 
	
                  Grantor
                    Trust Trustee

                	
                  X

                	 	 	 
	
                  Master
                    Servicer, affiliated Servicer, other Servicer servicing 20% or
                    more of
                    pool assets at time of report, other material servicers

                	
                  N/A

                	 	 	 
	
                  Securities
                    Administrator

                	
                  N/A

                	 	 	 
	
                  Originator

                	 	
                  X

                	 	 
	
                  Custodian

                	
                  N/A

                	 	 	 
	
                  Credit
                    Enhancer/Support Provider

                	 	
                  X

                	 	 
	
                  Significant
                    Obligor

                	 	
                  X

                	 	 
	
                  Item
                    1122 – Assessment of Compliance with Servicing
                    Criteria

                	
                  X

                	 	 	 
	
                  Item
                    1123 – Servicer Compliance Statement

                	
                  X

                	 	 	 

        

      

       

       

       

       

      EXHIBIT
        E

       

      ADDITIONAL
        DISCLOSURE NOTIFICATION

       

      Wells
        Fargo Bank, N.A., as Grantor Trust Trustee

      9062
        Old
        Annapolis Road

      Columbia,
        Maryland 21045

      Fax:
        (410) 715-2380

      E-mail:  cts.sec.notifications@wellsfargo.com

       

      Attn:  Client
        Manager - BSSP 2007-R3 - SEC REPORT PROCESSING

       

      RE:  **Additional
        Form [  ] Disclosure**Required

       

      

       

      Ladies
        and Gentlemen:

       

      In
        accordance with Section 3.11 of the
        Grantor Trust Agreement, dated as of October 24, 2007, by and between Structured
        Asset Mortgage Investments II Inc., as depositor, and Wells Fargo Bank, N.A.,
        as
        grantor trust trustee.  The Undersigned, as
        [    ], hereby notifies you that certain events have come to
        our attention that [will][may] need to be disclosed on Form
        [   ].

       

      Description
        of Additional Form [   ] Disclosure:

       

      List
        of
        Any Attachments hereto to be included in the Additional Form [  ]
        Disclosure:

       

       

      

       

      Any
        inquiries related to this
        notification should be directed to [   ], phone
        number:  [   ]; email
        address:  [   ].

       

      

       

      
        	
                [NAME
                  OF PARTY]

                as
                  [role]

                 

              
	 	 
	
                By:

              	 
	
                Name:

              	 
	
                Title:

              	 

      

      

       

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

       

      EXHIBIT
        F

       

      YIELD
        MAINTENANCE AGREEMENT

       

       

       

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      SCHEDULE
        A

       

      UNDERLYING
        SECURITIES

       

      

      
        	
                
                   

                  Full
                    Name of Series

                

              	
                
                  Initial
                    and Current Principal Balance

                

              	
                
                  Principal
                    Balance Included in Trust

                

              	
                
                   

                  Class
                    % in Trust

                

              
	
                Structured
                  Asset Mortgage Investments II Trust 2007-AR7, Mortgage Pass-Through
                  Certificates, Series 2007-AR7, Class III-A-2 Certificates

              	
                $10,759,000

              	
                $10,759,000

              	
                100.00%

              
	
                Structured
                  Asset Mortgage Investments II Trust 2007-AR7, Mortgage Pass-Through
                  Certificates, Series 2007-AR7, Class A-4 Certificates

              	
                $134,917,000

              	
                $14,000,000

              	
                10.3768%

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00132-of-00352.parquet"}]]