Document:

DATE:                         February 27, 2008

TO:                           Wells Fargo Bank, N.A., not individually, but
                              solely as Master Servicer on behalf of the
                              Supplemental Interest Trust in respect of Wells
                              Fargo Mortgage Backed Securities 2008-AR1 Trust
ATTENTION:                    Client Manager - Wells Fargo Mortgage Backed
                              Securities, Series 2008-AR1
TELEPHONE:                    (410) 884-2000
FACSIMILE:                    (410) 715-2380

FROM:                         Deutsche Bank AG, New York Branch
ATTENTION:                    New York Derivatives Documentation
TELEPHONE:                    (212) 250-9425
FACSIMILE:                    (212) 797-0779
E-MAIL:                       NYderivative.documentation@db.com
SUBJECT:                      Class A-1 Interest Rate Swap
REFERENCE NUMBER:             N764066N

The purpose of this long-form confirmation ("Long-form Confirmation") is to
confirm the terms and conditions of the current Transaction entered into on the
Trade Date specified below (the "Transaction") between Deutsche Bank AG, New
York Branch ("Party A") and Wells Fargo Bank, N.A., not individually, but solely
as Master Servicer on behalf of the Supplemental Interest Trust in respect of
Wells Fargo Mortgage Backed Securities 2008-AR1 Trust ("Party B") created under
the Pooling and Servicing Agreement, dated as of February 27, 2008 among Wells
Fargo Asset Securities Corporation, as depositor (the "Depositor"), HSBC Bank
USA, National Association, as trustee and Wells Fargo Bank, N.A., as master
servicer (the "PSA"). This Long-form Confirmation evidences a complete and
binding agreement between you and us to enter into the Transaction on the terms
set forth below and replaces any previous agreement between us with respect to
the subject matter hereof. Item 2 of this Long-form Confirmation constitutes a
"Confirmation" as referred to in the ISDA Master Agreement (defined below); Item
3 of this Long-form Confirmation constitutes a "Schedule" as referred to in the
ISDA Master Agreement; and Annex A hereto constitutes Paragraph 13 of a Credit
Support Annex to the Schedule.

Item 1.     The Confirmation set forth at Item 2 hereof shall supplement, form a
            part of, and be subject to an agreement in the form of the ISDA
            Master Agreement (Multicurrency - Cross Border) as published and
            copyrighted in 1992 by the International Swaps and Derivatives
            Association, Inc. (the "ISDA Master Agreement"), as if Party A and
            Party B had executed an agreement in such form on the date hereof,
            with a Schedule as set forth in Item 3 of this Long-form
            Confirmation, and an ISDA Credit Support Annex (Bilateral Form -
            ISDA Agreements Subject to New York Law Only version) as published
            and copyrighted in 1994 by the International Swaps and Derivatives
            Association, Inc., with Paragraph 13 thereof as set forth in Annex A
            hereto (the "Credit Support Annex"). For the avoidance of doubt, the
            Transaction described herein shall be the sole Transaction governed
            by such ISDA Master Agreement.

<PAGE>

Item 2.     The terms of the particular Transaction to which this Confirmation
            relates are as follows:

            Type of Transaction:          Interest Rate Swap

            Notional Amount:              With respect to any Calculation
                                          Period, the Principal Balance of the
                                          Class A-1 Certificates immediately
                                          prior to the related Distribution Date
                                          which occurs in the calendar month of
                                          the Distribution Date for such
                                          Calculation Period (determined for
                                          this purpose without regard to any
                                          adjustment of the Floating Rate I
                                          Payer Payment Date, Floating Rate II
                                          Payer Payment Date or Distribution
                                          Date relating to business days).

                                          The CUSIP no. of the Class A-1
                                          Certificates is: 94985Q AA2

                                          The Principal Balance of the Class A-1
                                          Certificates shall be published on the
                                          monthly statement to certificate
                                          holders on the internet website
                                          http://www.ctslink.com. If such report
                                          does not appear on the internet
                                          website referenced above, the
                                          Principal Balance of the Class A-1
                                          Certificates can be obtained by
                                          contacting the Master Servicer's
                                          customer relations desk at (866)
                                          846-4526.

            Trade Date:                   January 16, 2008

            Effective Date:               February 27, 2008

            Termination Date:             March 25, 2038, subject to adjustment
                                          in accordance with the Business Day
                                          Convention; provided, however, that
                                          for the purpose of determining the
                                          final Floating Rate I Payer Period End
                                          Date, Termination Date shall be
                                          subject to No Adjustment.

            Floating Amounts I:

                  Floating Rate I Payer:  Party A

                  Floating Rate I Payer
                  Period End Dates:       The 25th calendar day of each month
                                          during the Term of this Transaction,
                                          commencing March 25, 2008, and ending
                                          on the Termination Date, subject to
                                          adjustment in accordance with the
                                          Business Day Convention.

                  Floating Rate I Payer
                  Payment Dates:          Early Payment is applicable. The
                                          Floating Rate I Payer Payment Dates
                                          shall be one Business Day prior to
                                          each Floating Rate I Payer Period End
                                          Date.

                  Floating Rate I Option: USD-LIBOR-BBA; provided, that, for
                                          purposes of this Confirmation, the
                                          definition of USD-LIBOR-BBA shall be
                                          amended as follows:

                                          (a) by deleting the words "London
                                          Banking Days" and replacing them with
                                          the words "LIBOR Business Days," and

                                          (b) by adding the following at the end
                                          thereof: "Solely for purposes of this
                                          definition, "LIBOR Business Day" shall
                                          mean any day on which banks are open
                                          for dealing in foreign currency and
                                          exchange in London, England and the
                                          City of New York."

                  Designated Maturity:    One Month

                  Floating Rate I Amount: To be determined in accordance with
                                          the following formula:

                                          (Floating Rate I Option + Floating
                                          Rate I Spread) * Notional Amount *
                                          Floating Rate I Day Count Fraction

                  Floating Rate I Spread: Prior to and including the first date
                                          on which an Optional Termination is
                                          permitted to occur under the PSA,
                                          0.58% and, thereafter 1.16%

                  Floating Rate I Day     Actual/360
                  Count Fraction:

                  Reset Dates:            The first day of each Calculation
                                          Period.

            Floating Amounts II:

                  Floating Rate II Payer: Party B

                  Floating Rate II Payer  The 1st calendar day of each month
                  Period End Dates:       during the Term of this Transaction,
                                          commencing March 1, 2008, and ending
                                          on March 1, 2038, with No Adjustment.

                  Floating Rate II Payer  Early Payment is applicable. The
                  Payment Dates:          Floating Rate II Payer Payment Dates
                                          shall be one Business Day prior to
                                          each Floating Rate I Payer Period End
                                          Date.

                  Floating Rate II:       The per annum rate equal to the
                                          weighted average of the Net Mortgage
                                          Interest Rates of the Mortgage Loans
                                          (based on the Scheduled Principal
                                          Balances of the Mortgage Loans on the
                                          first day of the month preceding the
                                          Floating Rate II Payer Payment Date),
                                          applied as set forth under "Floating
                                          Rate II Amount" below.

                                          Party B shall use commercially
                                          reasonable efforts to provide to the
                                          Calculation Agent the weighted average
                                          of the Net Mortgage Interest Rates of
                                          the Mortgage Loans prior to each
                                          Floating Rate II Payer Payment Date
                                          and shall, in any case, provide such
                                          calculations to the Calculation Agent
                                          promptly upon receipt thereof, and the
                                          Calculation Agent shall make all
                                          calculations relating to the Floating
                                          Rate II Amount based on such
                                          information.

                  Floating Rate II
                  Amount:                 To be determined in accordance with
                                          the following formula:

                                          (i)   Floating Rate II Day Count
                                                Fraction * Floating Rate II *
                                                Notional Amount

                                                           plus

                                          (ii)  any payment of any Class A
                                                Unpaid Interest Shortfall
                                                allocated to the Class A-1
                                                Certificates under the PSA with
                                                respect to the related
                                                Distribution Date occurring in
                                                the calendar month of the
                                                Distribution Date for such
                                                Calculation Period

                                                          minus

                                          (iii) the sum of any Class A Interest
                                                Shortfall Amount, Non-Supported
                                                Interest Shortfall, Relief Act
                                                Shortfall and the interest
                                                portion of any Realized Losses
                                                allocated to the Class A-1
                                                Certificates under the PSA with
                                                respect to the related
                                                Distribution Date occurring in
                                                the calendar month of the
                                                Distribution Date for such
                                                Calculation Period

                  Floating Rate II Day    30/360
                  Count Fraction:

                  Compounding:            Inapplicable

                  Business Days:          Any day other than (i) a Saturday or a
                                          Sunday, or (ii) a legal holiday in the
                                          City of New York or (iii) a day on
                                          which banking institutions in the City
                                          of New York are authorized or
                                          obligated by law or executive order to
                                          be closed.

                  Business Day
                  Convention:             Following

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<PAGE>

Item 3.     Provisions Deemed Incorporated in a Schedule to the ISDA Master
            Agreement:

Part 1.     Termination Provisions.

For the purposes of this Agreement:-

(a)   "Specified Entity" will not apply to Party A or Party B for any purpose.

(b)   "Specified Transaction" will have the meaning specified in Section 14.

(c)   Events of Default.

      The statement below that an Event of Default will apply to a specific
      party means that upon the occurrence of such an Event of Default with
      respect to such party, the other party shall have the rights of a
      Non-defaulting Party under Section 6 of this Agreement; conversely, the
      statement below that such event will not apply to a specific party means
      that the other party shall not have such rights.

      (i)    The "Failure to Pay or Deliver" provisions of Section 5(a)(i) will
             apply to Party A and will apply to Party B; provided, however, that
             Section 5(a)(i) is hereby amended by replacing the word "third"
             with the word "first"; provided, further, that notwithstanding
             anything to the contrary in Section 5(a)(i), any failure by Party A
             to comply with or perform any obligation to be complied with or
             performed by Party A under the Credit Support Annex shall not
             constitute an Event of Default under Section 5(a)(i) unless a
             Moody's Second Trigger Downgrade Event has occurred and is
             continuing and at least 30 Local Business Days have elapsed since
             such Moody's Second Trigger Downgrade Event first occurred.

      (ii)   The "Breach of Agreement" provisions of Section 5(a)(ii) will apply
             to Party A and will not apply to Party B.

      (iii)  The "Credit Support Default" provisions of Section 5(a)(iii) will
             apply to Party A and will not apply to Party B except that Section
             5(a)(iii)(1) will apply to Party B solely in respect of Party B's
             obligations under Paragraph 3(b); provided, however, that
             notwithstanding anything to the contrary in Section 5(a)(iii)(1),
             any failure by Party A to comply with or perform any obligation to
             be complied with or performed by Party A under the Credit Support
             Annex shall not constitute an Event of Default under Section
             5(a)(iii) unless a Moody's Second Trigger Downgrade Event has
             occurred and is continuing and at least 30 Local Business Days have
             elapsed since such Moody's Second Trigger Downgrade Event first
             occurred.

      (iv)   The "Misrepresentation" provisions of Section 5(a)(iv) will apply
             to Party A and will not apply to Party B.

      (v)    The "Default under Specified Transaction" provisions of Section
             5(a)(v) will apply to Party A and will not apply to Party B.

      (vi)   The "Cross Default" provisions of Section 5(a)(vi) will apply to
             Party A and will not apply to Party B, provided, however, that,
             notwithstanding the foregoing, an Event of Default shall not occur
             under either Section 5(a)(vi)(1) or Section 5(a)(vi)(2) if (A) (I)
             the default, or other similar event or condition referred to in
             Section 5(a)(vi)(1) or the failure to pay referred to in Section
             5(a)(vi)(2) is a failure to pay or deliver caused by an error or
             omission of an administrative or operational nature, and (II) funds
             or the asset to be delivered were available to such party to enable
             it to make the relevant payment or delivery when due and (III) such
             payment or delivery is made within three (3) Local Business Days
             following receipt of written notice from an interested party of
             such failure to pay, or (B) such party was precluded from paying,
             or was unable to pay, using reasonable means, through the office of
             the party through which it was acting for purposes of the relevant
             Specified Indebtedness, by reason of force majeure, act of State,
             illegality or impossibility (any such event, a "Force Majeure"),
             provided that funds were available to such party to make the
             relevant payment or delivery when due and such payment or delivery
             is made within three (3) Local Business Days of such Force Majeure
             ceasing to exist. For purposes of Section 5(a)(vi), solely with
             respect to Party A:

             "Specified Indebtedness" will have the meaning specified in Section
             14, except that such term shall not include obligations in respect
             of deposits received in the ordinary course of Party A's banking
             business.

             "Threshold Amount" means with respect to Party A an amount equal to
             three percent (3%) of the shareholders' equity of Party A or, if
             applicable, a guarantor under an Eligible Guarantee with credit
             ratings at least equal to the Moody's Second Trigger Threshold and
             the Fitch First Trigger Ratings Threshold (as shown in the most
             recent annual audited financial statements of such entity
             determined in accordance with generally accepted accounting
             principles).

      (vii)  The "Bankruptcy" provisions of Section 5(a)(vii) will apply to
             Party A and will apply to Party B; provided, however, that, for
             purposes of applying Section 5(a)(vii) to Party B: (A) Section
             5(a)(vii)(2) shall not apply, (B) Section 5(a)(vii)(3) shall not
             apply to any assignment, arrangement or composition that is
             effected by or pursuant to the PSA, (C) Section 5(a)(vii)(4) shall
             not apply to a proceeding instituted, or a petition presented, by
             Party A or any of its Affiliates (for purposes of Section
             5(a)(vii)(4), Affiliate shall have the meaning set forth in Section
             14, notwithstanding anything to the contrary in this Agreement),
             (D) Section 5(a)(vii)(6) shall not apply to any appointment that is
             effected by or pursuant to the PSA, or any appointment to which
             Party B has not yet become subject; (E) Section 5(a)(vii)(7) shall
             not apply; (F) Section 5(a)(vii)(8) shall apply only to the extent
             of any event which has an effect analogous to any of the events
             specified in clauses (1), (3), (4), (5) or (6) of Section
             5(a)(vii), in each case as modified in this Part 1(c)(vii), and (G)
             Section 5(a)(vii)(9) shall not apply.

      (viii) The "Merger Without Assumption" provisions of Section 5(a)(viii)
             will apply to Party A and will not apply to Party B.

(d)   Termination Events.

      The statement below that a Termination Event will apply to a specific
      party means that upon the occurrence of such a Termination Event, if such
      specific party is the Affected Party with respect to a Tax Event, the
      Burdened Party with respect to a Tax Event Upon Merger (except as noted
      below) or the non-Affected Party with respect to a Credit Event Upon
      Merger, as the case may be, such specific party shall have the right to
      designate an Early Termination Date in accordance with Section 6 of this
      Agreement; conversely, the statement below that such an event will not
      apply to a specific party means that such party shall not have such right;
      provided, however, with respect to "Illegality" the statement that such
      event will apply to a specific party means that upon the occurrence of
      such a Termination Event with respect to such party, either party shall
      have the right to designate an Early Termination Date in accordance with
      Section 6 of this Agreement.

      (i)   The "Illegality" provisions of Section 5(b)(i) will apply to Party A
            and will apply to Party B.

      (ii)  The "Tax Event" provisions of Section 5(b)(ii) will apply to Party A
            except that, for purposes of the application of Section 5(b)(ii) to
            Party A, Section 5(b)(ii) is hereby amended by deleting the words
            "(x) any action taken by a taxing authority, or brought in a court
            of competent jurisdiction, on or after the date on which a
            Transaction is entered into (regardless of whether such action is
            taken or brought with respect to a party to this Agreement) or (y)",
            and the "Tax Event" provisions of Section 5(b)(ii) will apply to
            Party B.

      (iii) The "Tax Event Upon Merger" provisions of Section 5(b)(iii) will
            apply to Party A and will apply to Party B, provided that Party A
            shall not be entitled to designate an Early Termination Date by
            reason of a Tax Event upon Merger in respect of which it is the
            Affected Party.

      (iv)  The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will
            not apply to Party A and will not apply to Party B.

(e)   The "Automatic Early Termination" provision of Section 6(a) will not apply
      to Party A and will not apply to Party B.

(f)   Payments on Early Termination. For the purpose of Section 6(e) of this
      Agreement:

      (i)   Market Quotation will apply, provided, however, that,
            notwithstanding anything to the contrary in this Agreement, if an
            Early Termination Date has been designated as a result of a
            Derivative Provider Trigger Event, the following provisions will
            apply:

            (A)   The definition of Market Quotation in Section 14 shall be
                  deleted in its entirety and replaced with the following:

                  "Market Quotation" means, with respect to one or more
                  Terminated Transactions, a Firm Offer which is (1) made by an
                  Eligible Replacement, (2) for an amount that would be paid to
                  Party B (expressed as a negative number) or by Party B
                  (expressed as a positive number) in consideration of an
                  agreement between Party B and such Eligible Replacement to
                  enter into a Replacement Transaction, and (3) made on the
                  basis that Unpaid Amounts in respect of the Terminated
                  Transaction or group of Transactions are to be excluded but,
                  without limitation, any payment or delivery that would, but
                  for the relevant Early Termination Date, have been required
                  (assuming satisfaction of each applicable condition precedent)
                  after that Early Termination Date is to be included.

            (B)   The definition of Settlement Amount shall be deleted in its
                  entirety and replaced with the following:

                  "Settlement Amount" means, with respect to any Early
                  Termination Date, an amount (as determined by Party B) equal
                  to:

                  (a)   if, on or prior to such Early Termination Date, a Market
                        Quotation for the relevant Terminated Transaction or
                        group of Terminated Transactions is accepted by Party B
                        so as to become legally binding, the Termination
                        Currency Equivalent of the amount (whether positive or
                        negative) of such Market Quotation;

                  (b)   if, on such Early Termination Date, no Market Quotation
                        for the relevant Terminated Transaction or group of
                        Terminated Transactions has been accepted by Party B so
                        as to become legally binding and one or more Market
                        Quotations from Approved Replacements have been
                        communicated to Party B and remain capable of becoming
                        legally binding upon acceptance by Party B, the
                        Termination Currency Equivalent of the amount (whether
                        positive or negative) of the lowest of such Market
                        Quotations (for the avoidance of doubt, (I) a Market
                        Quotation expressed as a negative number is lower than a
                        Market Quotation expressed as a positive number and (II)
                        the lower of two Market Quotations expressed as negative
                        numbers is the one with the largest absolute value); or

                  (c)   if, on such Early Termination Date, no Market Quotation
                        for the relevant Terminated Transaction or group of
                        Terminated Transactions is accepted by Party B so as to
                        become legally binding and no Market Quotation from an
                        Approved Replacement has been communicated to Party B
                        and remains capable of becoming legally binding upon
                        acceptance by Party B, Party B's Loss (whether positive
                        or negative and without reference to any Unpaid Amounts)
                        for the relevant Terminated Transaction or group of
                        Terminated Transactions."

            (C)   If Party B requests Party A in writing to obtain Market
                  Quotations, Party A shall use its reasonable efforts to do so
                  before the Early Termination Date.

            (D)   If the Settlement Amount is a negative number, Section
                  6(e)(i)(3) shall be deleted in its entirety and replaced with
                  the following:

                  "(3) Second Method and Market Quotation. If the Second Method
                  and Market Quotation apply, (I) Party B shall pay to Party A
                  an amount equal to the absolute value of the Settlement Amount
                  in respect of the Terminated Transactions, (II) Party B shall
                  pay to Party A the Termination Currency Equivalent of the
                  Unpaid Amounts owing to Party A and (III) Party A shall pay to
                  Party B the Termination Currency Equivalent of the Unpaid
                  Amounts owing to Party B; provided, however, that (x) the
                  amounts payable under the immediately preceding clauses (II)
                  and (III) shall be subject to netting in accordance with
                  Section 2(c) of this Agreement and (y) notwithstanding any
                  other provision of this Agreement, any amount payable by Party
                  A under the immediately preceding clause (III) shall not be
                  netted against any amount payable by Party B under the
                  immediately preceding clause (I)."

            (E)   At any time on or before the Early Termination Date at which
                  two or more Market Quotations from Approved Replacements have
                  been communicated to Party B and remain capable of becoming
                  legally binding upon acceptance by Party B, Party B shall be
                  entitled to accept only the lowest of such Market Quotations
                  (for the avoidance of doubt, (I) a Market Quotation expressed
                  as a negative number is lower than a Market Quotation
                  expressed as a positive number and (II) the lower of two
                  Market Quotations expressed as negative numbers is the one
                  with the largest absolute value).

            (F)   Party B shall determine based on information provided by an
                  entity that qualifies as a Reference Market-maker whether or
                  not a Firm Offer satisfies clause (B)(y) of the definition of
                  Replacement Transaction and whether or not a proposed transfer
                  satisfies clause (e)(B)(y) of the definition of Permitted
                  Transfer.

      (ii)  The Second Method will apply.

(g)   "Termination Currency" means USD.

(h)   Additional Termination Events. Additional Termination Events will apply as
      provided in Part 5(c).

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<PAGE>

Part 2.     Tax Matters.

(a)   Tax Representations.

      (i)   Payer Representations. For the purpose of Section 3(e) of this
            Agreement:

            (A)   Party A makes the following representation(s):

                  It is not required by any applicable law, as modified by the
                  practice of any relevant governmental revenue authority, of
                  any Relevant Jurisdiction to make any deduction or withholding
                  for or on account of any Tax from any payment (other than
                  interest under Section 2(e), 6(d)(ii) or 6(e) of this
                  Agreement) to be made by it to the other party under this
                  Agreement. In making this representation, it may rely on: (i)
                  the accuracy of any representations made by the other party
                  pursuant to Section 3(f) of this Agreement; (ii) the
                  satisfaction of the agreement contained in Section 4(a)(i) or
                  4(a)(iii) of this Agreement and the accuracy and effectiveness
                  of any document provided by the other party pursuant to
                  Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the
                  satisfaction of the agreement of the other party contained in
                  Section 4(d) of this Agreement, provided that it shall not be
                  a breach of this representation where reliance is placed on
                  clause (ii) and the other party does not deliver a form or
                  document under Section 4(a)(iii) by reason of material
                  prejudice to its legal or commercial position.

            (B)   Party B makes the following representation(s):

                  None.

      (ii)  Payee Representations. For the purpose of Section 3(f) of this
            Agreement:

            (A)   Party A makes the following representation(s):

                  It is a "foreign person" within the meaning of the applicable
                  U.S. Treasury Regulations concerning information reporting and
                  backup withholding tax (as in effect on January 1, 2001),
                  unless Party A provides written notice to Party B that it is
                  no longer a foreign person. In respect of any Transaction it
                  enters into through an office or discretionary agent in the
                  United States or which otherwise is allocated for United
                  States federal income tax purposes to such United States trade
                  or business, each payment received or to be received by it
                  under such Transaction will be effectively connected with its
                  conduct of a trade or business in the United States.

            (B)   Party B makes the following representation(s):

                  None.

(b)   Tax Provisions.

      (i)   Gross Up. Section 2(d)(i)(4) shall not apply to Party B as X, and
            Section 2(d)(ii) shall not apply to Party B as Y, in each case such
            that Party B shall not be required to pay any additional amounts
            referred to therein.

      (ii)  Indemnifiable Tax. The definition of "Indemnifiable Tax" in Section
            14 is deleted in its entirety and replaced with the following:

            "Indemnifiable Tax" means, in relation to payments by Party A, any
            Tax and, in relation to payments by Party B, no Tax.

Part 3.     Agreement to Deliver Documents.

(a)   For the purpose of Section 4(a)(i), tax forms, documents, or certificates
      to be delivered are:

Party required
to deliver      Form/Document/                      Date by which
document        Certificate                         to be delivered

Party A         An original properly completed      (i) upon execution of this
                and executed United States          Agreement, (ii) on or before
                Internal Revenue Service Form       the first payment date under
                W-8ECI or other applicable form     this Agreement, including
                (or any successor thereto)          any Credit Support Document,
                together with appropriate           (iii) promptly upon the
                attachments, with respect to any    reasonable demand by Party
                payments received or to be          B, (iv) prior to the
                received by Party A that            expiration or obsolescence
                eliminates U.S. federal             of any previously delivered
                withholding and backup              form, and (v) promptly upon
                withholding Tax on payments to      the information on any such
                Party A under this Agreement.       previously delivered form
                                                    becoming inaccurate or
                                                    incorrect.

Party B         (i) Upon execution of this          (i) upon execution of this
                Agreement, an original properly     Agreement, (ii) on or before
                completed and executed United       the first payment date under
                States Internal Revenue Service     this Agreement, including
                Form W-9 (or any successor          any Credit Support Document,
                thereto) with respect to any        (iii) in the case of a tax
                payments received or to be          certification form other
                received by the initial             than a Form W-9, before
                beneficial owner of payments to     December 31 of each third
                Party B under this Agreement, and   succeeding calendar year,
                (ii) thereafter, the appropriate    (iv) promptly upon the
                tax certification form (i.e., IRS   reasonable demand by Party
                Form W-9 or IRS Form W-8BEN,        A, (v) prior to the
                W-8IMY, W-8EXP or W-8ECI, as        expiration or obsolescence
                applicable (or any successor form   of any previously delivered
                thereto)) with respect to any       form, and (vi) promptly upon
                payments received or to be          obtaining actual knowledge
                received by the beneficial owner    that the information on any
                of payments to Party B under this   such previously delivered
                Agreement from time to time. (b)    form becoming inaccurate or
                                                    incorrect.

(b)   For the purpose of Section 4(a)(ii), other documents to be delivered are:

Party required                             Date by                Covered by
to deliver      Form/Document/             which to               Section 3(d)
document        Certificate                be delivered           Representation

Party A and     Any documents required     Upon the execution     Yes
Party B         by the receiving party     and delivery of this
                to evidence the            Agreement
                authority of the
                delivering party or its
                Credit Support Provider,
                if any, for it to
                execute and deliver the
                Agreement, each
                Confirmation, and any
                Credit Support Documents
                to which it is a party,
                and to evidence the
                authority of the
                delivering party or its
                Credit Support Provider
                to perform its
                obligations under the
                Agreement, each
                Confirmation and any
                Credit Support Document,
                as the case may be

Party A and     A certificate of an        Upon the execution     Yes
Party B         authorized officer of      and delivery of this
                the party, as to the       Agreement
                incumbency and authority
                of the respective
                officers of the party
                signing the Agreement,
                each Confirmation, and
                any relevant Credit
                Support Document, as the
                case may be

Party A         Annual Report of Party A   Promptly upon          Yes
                containing consolidated    becoming publicly
                financial statements       available
                certified by independent
                certified public
                accountants and prepared
                in accordance with
                generally accepted
                accounting principles in
                the country in which
                Party A is organized

Party A         Quarterly Financial        Promptly upon          Yes
                Statements of Party A      becoming publicly
                containing unaudited,      available
                consolidated financial
                statements of Party A's
                fiscal quarter prepared
                in accordance with
                generally accepted
                accounting principles in
                the country in which
                Party A is organized

Party A         An opinion of counsel to   Upon the execution     No
                Party A reasonably         and delivery of this
                acceptable to Party B.     Agreement

Party B         An executed copy of the    Within 30 days after   No
                PSA.                       the date of this
                                           Agreement

Part 4.     Miscellaneous.

(a)   Address for Notices: For the purposes of Section 12(a) of this Agreement:

      Address for notices or communications to Party A:

      Any notice to Party A relating to a particular Transaction shall be
      delivered to the address or facsimile number specified in the Confirmation
      of such Transaction. Any notice delivered for purposes of Sections 5 and 6
      (other than notices under Section 5(a)(i) with respect to Party A) of this
      Agreement shall be delivered to the following address:

     Address:          Deutsche Bank AG, Head Office
                       Taunusanlage 12
                       60262 Frankfurt
                       GERMANY
     Attention:        Legal Department
     Facsimile:        0049 69 910 36097

     (For all purposes)

     Address for notices or communications to Party B:

     Address:          Wells Fargo Bank, N.A.
                       9062 Old Annapolis Road
                       Columbia, MD 21045
     Attention:        Client Manager - Wells Fargo Mortgage Backed Securities,
                       Series 2008-AR1
     Facsimile:        (410) 715-2380
     Phone:            (410) 884-2000
                       (For all purposes)

(b)   Process Agent. For the purpose of Section 13(c):

      Party A appoints as its Process Agent: Not applicable

      Party B appoints as its Process Agent:  Not applicable.

(c)   Offices. The provisions of Section 10(a) will apply to this Agreement.

(d)   Multibranch Party. For the purpose of Section 10(c) of this Agreement:

      Party A is not a Multibranch Party.

      Party B is not a Multibranch Party.

(e)   Calculation Agent. The Calculation Agent is Party A; provided, however,
      that if an Event of Default shall have occurred and is continuing with
      respect to Party A, Party B shall have the right to appoint as Calculation
      Agent a financial institution which would qualify as a Reference
      Market-maker, reasonably acceptable to Party A, the cost for which shall
      be borne by Party A.

(f)   Credit Support Document.

     Party A:     The Credit Support Annex, and any guarantee in support of
                  Party A's obligations under this Agreement.

     Party B:     The Credit Support Annex, solely in respect of Party B's
                  obligations under Paragraph 3(b) of the Credit Support Annex.

(g)   Credit Support Provider.

     Party A:     The guarantor under any guarantee in support of Party A's
                  obligations under this Agreement.

     Party B:     None.

(h)   Governing Law. The parties to this Agreement hereby agree that the law of
      the State of New York shall govern their rights and duties in whole
      (including any claim or controversy arising out of or relating to this
      Agreement), without regard to the conflict of law provisions thereof other
      than New York General Obligations Law Sections 5-1401 and 5-1402.

(i)   Netting of Payments. Subparagraph (ii) of Section 2(c) will apply to each
      Transaction hereunder.

(j)   Affiliate. "Affiliate" shall have the meaning assigned thereto in Section
      14; provided, however, that Party B shall be deemed to have no Affiliates
      for purposes of this Agreement, including for purposes of Section
      6(b)(ii).

               [Remainder of this page intentionally left blank.]

<PAGE>

Part 5.     Other Provisions.

(a)   Definitions. Unless otherwise specified in a Confirmation, this Agreement
      and each Transaction under this Agreement are subject to the 2000 ISDA
      Definitions as published and copyrighted in 2000 by the International
      Swaps and Derivatives Association, Inc. (the "Definitions"), and will be
      governed in all relevant respects by the provisions set forth in the
      Definitions, without regard to any amendment to the Definitions subsequent
      to the date hereof. The provisions of the Definitions are hereby
      incorporated by reference in and shall be deemed a part of this Agreement,
      except that (i) references in the Definitions to a "Swap Transaction"
      shall be deemed references to a "Transaction" for purposes of this
      Agreement, and (ii) references to a "Transaction" in this Agreement shall
      be deemed references to a "Swap Transaction" for purposes of the
      Definitions. Each term capitalized but not defined in this Agreement shall
      have the meaning assigned thereto in the PSA.

      Each reference herein to a "Section" (unless specifically referencing the
      PSA) or to a "Section" "of this Agreement" will be construed as a
      reference to a Section of the ISDA Master Agreement; each herein reference
      to a "Part" will be construed as a reference to the Schedule to the ISDA
      Master Agreement; each reference herein to a "Paragraph" will be construed
      as a reference to a Paragraph of the Credit Support Annex.

(b)   Amendments to ISDA Master Agreement.

      (i)   Single Agreement. Section 1(c) is hereby amended by the adding the
            words "including, for the avoidance of doubt, the Credit Support
            Annex" after the words "Master Agreement".

      (ii)  Conditions Precedent. Section 2(a)(iii) is hereby amended by adding
            the following at the end thereof:

            Notwithstanding anything to the contrary in Section 2(a)(iii)(1), if
            an Event of Default with respect to Party B or Potential Event of
            Default with respect to Party B has occurred and been continuing for
            more than 30 Local Business Days and no Early Termination Date in
            respect of the Affected Transactions has occurred or been
            effectively designated by Party A, the obligations of Party A under
            Section 2(a)(i) shall cease to be subject to the condition precedent
            set forth in Section 2(a)(iii)(1) with respect to such specific
            occurrence of such Event of Default or such Potential Event of
            Default (the "Specific Event"); provided, however, for the avoidance
            of doubt, the obligations of Party A under Section 2(a)(i) shall be
            subject to the condition precedent set forth in Section 2(a)(iii)(1)
            (subject to the foregoing) with respect to any subsequent occurrence
            of the same Event of Default with respect to Party B or Potential
            Event of Default with respect to Party B after the Specific Event
            has ceased to be continuing and with respect to any occurrence of
            any other Event of Default with respect to Party B or Potential
            Event of Default with respect to Party B that occurs subsequent to
            the Specific Event.

      (iii) Change of Account. Section 2(b) is hereby amended by the addition of
            the following after the word "delivery" in the first line thereof:
            "to another account in the same legal and tax jurisdiction as the
            original account".

      (iv)  Representations. Section 3 is hereby amended by adding at the end
            thereof the following subsection (g):

            "(g)  Relationship Between Parties.

                  (1)   Nonreliance. (i) Deutsche Bank AG, New York Bank is
                        acting for its own account and with respect to Party B,
                        Wells Fargo Bank, N.A., is executing solely as Master
                        Servicer on behalf of the Supplemental Interest Trust in
                        respect of Wells Fargo Mortgage Backed Securities
                        2008-AR1 Trust, (ii) It is not relying on any statement
                        or representation of the other party (whether written or
                        oral) regarding any Transaction hereunder, other than
                        the representations expressly made in this Agreement or
                        the Confirmation in respect of that Transaction and
                        (iii) it has consulted with its own legal, regulatory,
                        tax, business, investment, financial and accounting
                        advisors to the extent it has deemed necessary, and it
                        has made its own investment, hedging and trading
                        decisions based upon its own judgment and upon any
                        advice from such advisors as it has deemed necessary and
                        not upon any view expressed by the other party.

                  (2)   Evaluation and Understanding. (i) It has the capacity to
                        evaluate (internally or through independent professional
                        advice) each Transaction and has made its own decision
                        to enter into the Transaction and (ii) it understands
                        the terms, conditions and risks of the Transaction and
                        is willing and able to accept those terms and conditions
                        and to assume those risks, financially and otherwise.

                  (3)   Purpose. It is entering into the Transaction for the
                        purposes of managing its borrowings or investments,
                        hedging its underlying assets or liabilities or in
                        connection with a line of business.

                  (4)   Status of Parties. The other party is not acting as an
                        agent, fiduciary or advisor for it in respect of the
                        Transaction.

                  (5)   Eligible Contract Participant. It is an "eligible swap
                        participant" as such term is defined in, Section
                        35.1(b)(2) of the regulations (17 C.F.R. 35) promulgated
                        under, and an "eligible contract participant" as defined
                        in Section 1(a)(12) of the Commodity Exchange Act, as
                        amended."

      (v)   Transfer to Avoid Termination Event. Section 6(b)(ii) is hereby
            amended (i) by deleting the words "or if a Tax Event Upon Merger
            occurs and the Burdened Party is the Affected Party," and the words
            ", which consent will not be withheld if such other party's policies
            in effect at such time would permit it to enter into transactions
            with the transferee on the terms proposed" and (ii) by deleting the
            words "to transfer" and inserting the words "to effect a Permitted
            Transfer" in lieu thereof.

      (vi)  Jurisdiction. Section 13(b) is hereby amended by: (i) deleting in
            the second line of subparagraph (i) thereof the word "non-", (ii)
            deleting "; and" from the end of subparagraph (i) and inserting "."
            in lieu thereof, and (iii) deleting the final paragraph thereof.

(c)   Additional Termination Events. The following Additional Termination Events
      will apply:

      (i)   Failure to Post Collateral. If Party A has failed to comply with or
            perform any obligation to be complied with or performed by Party A
            in accordance with the Credit Support Annex and such failure has not
            given rise to an Event of Default under Section 5(a)(i) or Section
            5(a)(iii), then an Additional Termination Event shall have occurred
            with respect to Party A and Party A shall be the sole Affected Party
            with respect to such Additional Termination Event.

      (ii)  Second Rating Trigger Replacement. The occurrence of any event
            described in this Part 5(c)(ii) shall constitute an Additional
            Termination Event with respect to Party A and Party A shall be the
            sole Affected Party with respect to such Additional Termination
            Event.

            (A)   A Moody's Second Trigger Downgrade Event has occurred and is
                  continuing and at least 30 Local Business Days have elapsed
                  since such Moody's Second Trigger Downgrade Event first
                  occurred, and at least one Eligible Replacement has made a
                  Firm Offer that would, assuming the occurrence of an Early
                  Termination Date, qualify as a Market Quotation (on the basis
                  that Part 1(f)(i)(A) applies) and which remains capable of
                  becoming legally binding upon acceptance.

            (B)   A Fitch Second Trigger Downgrade Event has occurred and is
                  continuing and at least 30 calendar days have elapsed since
                  such Fitch Second Trigger Downgrade Event first occurred.

      (iii) Amendment of PSA. If, without the prior written consent of Party A
            where such consent is required under the PSA (such consent not to be
            unreasonably withheld, conditioned or delayed), an amendment is made
            to the PSA, an Additional Termination Event shall have occurred with
            respect to Party B and Party B shall be the sole Affected Party with
            respect to such Additional Termination Event

      (iv)  Optional Termination of Securitization. An Additional Termination
            Event shall occur upon the notice to Certificateholders of an
            optional purchase of all Mortgage Loans and any REO Mortgage Loans
            by the Depositor pursuant to Section 9.01 of the PSA (an "Optional
            Termination") becoming unrescindable in accordance with Article IX
            of the PSA (such notice, the "Optional Termination Notice"). With
            respect to such Additional Termination Event: (A) Party B shall be
            the sole Affected Party; (B) notwithstanding anything to the
            contrary in Section 6(b)(iv) or Section 6(c)(i), the final
            Distribution Date specified in the Optional Termination Notice is
            hereby designated as the Early Termination Date for this Additional
            Termination Event in respect of all Affected Transactions; (C)
            Section 2(a)(iii)(2) shall not be applicable to any Affected
            Transaction in connection with the Early Termination Date resulting
            from this Additional Termination Event; notwithstanding anything to
            the contrary in Section 6(c)(ii), payments and deliveries under
            Section 2(a)(i) or Section 2(e) in respect of the Terminated
            Transactions resulting from this Additional Termination Event will
            be required to be made through and including the Early Termination
            Date designated as a result of this Additional Termination Event;
            provided, for the avoidance of doubt, that any such payments or
            deliveries that are made on or prior to such Early Termination Date
            will not be treated as Unpaid Amounts in determining the amount
            payable in respect of such Early Termination Date; (D)
            notwithstanding anything to the contrary in Section 6(d)(i), (I) if,
            no later than 4:00 pm New York City time on the day that is four
            Business Days prior to the final Distribution Date specified in the
            Optional Termination Notice, the Master Servicer requests the amount
            of the Estimated Swap Termination Payment, Party A shall provide to
            the Master Servicer in writing (which may be done in electronic
            format) the amount of the Estimated Swap Termination Payment no
            later than 2:00 pm New York City time on the following Business Day
            and (II) if the Master Servicer provides written notice (which may
            be done in electronic format) to Party A no later than two Business
            Days prior to the final Distribution Date specified in the Optional
            Termination Notice that all requirements of the Optional Termination
            have been met, then Party A shall, no later than one Business Day
            prior to the final Distribution Date specified in the Optional
            Termination Notice, make the calculations contemplated by Section
            6(e) (as amended herein) and provide to the Master Servicer in
            writing (which may be done in electronic format) the amount payable
            by either Party B or Party A in respect of the related Early
            Termination Date in connection with this Additional Termination
            Event; provided, however, that the amount payable by Party B, if
            any, in respect of the related Early Termination Date shall be the
            lesser of (x) the amount calculated to be due from Party B pursuant
            to Section 6(e) and (y) the Estimated Swap Termination Payment; and
            (E) notwithstanding anything to the contrary in this Agreement, any
            amount due from Party B to Party A in respect of this Additional
            Termination Event will be payable one Business Day prior to the
            final Distribution Date specified in the Optional Termination Notice
            and any amount due from Party A to Party B in respect of this
            Additional Termination Event will be payable one Business Day prior
            to the final Distribution Date specified in the Optional Termination
            Notice.

      (v)   Regulation AB - 10% Disclosure Request. If (1) the Depositor still
            has a reporting obligation with respect to this Transaction pursuant
            to Regulation AB (as defined below) and (2) Party A has not, within
            30 days after receipt of a 10% Disclosure Request (as defined below)
            complied with the provisions set forth in clauses (ii) and (iii) of
            Part 5(e) below (provided that if the significance percentage is 10%
            or more and less than 20% when the 10% Disclosure Request is made or
            reaches 10% after a 10% Disclosure Request has been made to Party A,
            Party A must comply with the provisions set forth in clauses (ii)
            and (iii) of Part 5(e) below within 3 calendar days of Party A being
            informed of the significance percentage reaching 10% or more), then
            an Additional Termination Event shall have occurred with respect to
            Party A and Party A shall be the sole Affected Party with respect to
            such Additional Termination Event.

      (vi)  Regulation AB - 20% Disclosure Request. If (1) the Depositor still
            has a reporting obligation with respect to this Transaction pursuant
            to Regulation AB and (2) Party A has not, within 30 days after
            receipt of a 20% Disclosure Request (as defined below) complied with
            the provisions set forth in clauses (iv) and (v) of Part 5(e) below
            (provided that if the significance percentage is 20% or more when
            the 20% Disclosure Request is made or reaches 20% after a 20%
            Disclosure Request has been made to Party A, Party A must comply
            with the provisions set forth in clauses (iv) and (v) of Part 5(e)
            below within 3 calendar days of Party A being informed of the
            significance percentage reaching 20% or more), then an Additional
            Termination Event shall have occurred with respect to Party A and
            Party A shall be the sole Affected Party with respect to such
            Additional Termination Event.

(d)   Required Ratings Downgrade Event. If a Required Ratings Downgrade Event
      has occurred and is continuing, then Party A shall, at its own expense,
      use commercially reasonable efforts to, as soon as reasonably practicable,
      either (A) effect a Permitted Transfer or (B) procure an Eligible
      Guarantee by a guarantor with credit ratings at least equal to the Moody's
      Second Trigger Threshold and the Fitch First Trigger Ratings Threshold.

(e)   Compliance with Regulation AB

      (i)   Party A acknowledges that for so long as there are reporting
            obligations with respect to this Transaction under Regulation AB,
            the Depositor, acting on behalf of the Issuing Entity, is required
            under Regulation AB under the Securities Act of 1933, as amended,
            and the Securities Exchange Act of 1934, as amended ("Regulation
            AB"), to disclose certain information set forth in Regulation AB
            regarding Party A or its group of affiliated entities, if
            applicable, depending on the aggregate "significance percentage" of
            this Agreement and any other derivative contracts between Party A or
            its group of affiliated entities, if applicable, and Party B, as
            calculated from time to time in accordance with Item 1115 of
            Regulation AB.

      (ii)  If the Depositor determines, reasonably and in good faith, that the
            significance percentage of this Agreement (and any other derivative
            contracts between Party A or its group of affiliated entities, if
            applicable, and Party B) has increased to eight (8) percent or more
            but less than eighteen (18) percent, then the Depositor may request
            on the date of such determination (or, if such date of determination
            is not a Business Day, the immediately following Business Day) from
            Party A the same information set forth in Item 1115(b)(1) of
            Regulation AB that would have been required if the significance
            percentage had in fact increased to ten (10) percent, along with any
            necessary auditors' consent (such request, a "10% Disclosure
            Request" and such requested information, subject to the last
            sentence of this paragraph, is the "10% Financial Disclosure"). The
            Depositor shall provide Party A with the calculations and any other
            information reasonably requested by Party A with respect to the
            Depositor's determination that led to the 10% Disclosure Request.
            The parties hereto further agree that the 10% Financial Disclosure
            provided to meet the 10% Disclosure Request may be, solely at Party
            A's option, either the information set forth in Item 1115(b)(1) or
            Item 1115(b)(2) of Regulation AB.

      (iii) Upon the occurrence of a 10% Disclosure Request, Party A, at its own
            expense, shall (i) provide the Depositor with the 10% Financial
            Disclosure, (ii) subject to Rating Agency Confirmation, secure
            another entity to replace Party A as party to this Agreement on
            terms substantially similar to this Agreement which entity is able
            to (A) provide the 10% Financial Disclosure and (B) provide an
            indemnity to the Depositor, reasonably satisfactory to the
            Depositor, in relation to the 10% Financial Disclosure or (iii)
            subject to Rating Agency Confirmation, obtain a guaranty of Party
            A's obligations under this Agreement from an affiliate of Party A
            that is able to (A) provide the 10% Financial Disclosure, such that
            disclosure provided in respect of the affiliate will, in the
            judgment of counsel to the Depositor, satisfy any disclosure
            requirements applicable to Party A, and cause such affiliate to
            provide 10% Financial Disclosure and (B) provide an indemnity to the
            Depositor, reasonably satisfactory to the Depositor, in relation to
            the 10% Financial Disclosure. Any such 10% Financial Disclosure
            provided pursuant to this paragraph (iii) shall be in a form
            suitable for conversion to the format required for filing by the
            Depositor with the Securities and Exchange Commission via the
            Electronic Data Gathering and Retrieval System (EDGAR). If permitted
            by Regulation AB, any required 10% Financial Disclosure may be
            provided by incorporation by reference from reports filed pursuant
            to the Securities Exchange Act.

      (iv)  If the Depositor determines, reasonably and in good faith, that the
            significance percentage of this Agreement (and any other derivative
            contracts between Party A or its group of affiliated entities, if
            applicable, and Party B) has increased to eighteen (18) percent or
            more, then the Depositor may request on the date of such
            determination (or, if such date of determination is not a Business
            Day, the immediately following Business Day) from Party A the same
            information set forth in Item 1115(b)(2) of Regulation AB that would
            have been required if the significance percentage had in fact
            increased to twenty (20) percent, along with any necessary auditors
            consent (such request, a "20% Disclosure Request" and such requested
            information is the "20% Financial Disclosure"). Party B or the
            Depositor shall provide Party A with the calculations and any other
            information reasonably requested by Party A with respect to the
            Depositor's determination that led to the 20% Disclosure Request.

      (v)   Upon the occurrence of a 20% Disclosure Request, Party A, at its own
            expense, shall (i) provide the Depositor with the 20% Financial
            Disclosure, (ii) subject to Rating Agency Confirmation, secure
            another entity to replace Party A as party to this Agreement on
            terms substantially similar to this Agreement which entity is able
            to (A) provide the 20% Financial Disclosure and (B) provide an
            indemnity to the Depositor, reasonably satisfactory to the
            Depositor, in relation to the 20% Financial Disclosure or (iii)
            subject to Rating Agency Confirmation, obtain a guaranty of Party
            A's obligations under this Agreement from an affiliate of Party A
            that is able to (A) provide the 20% Financial Disclosure, such that
            disclosure provided in respect of the affiliate will, in the
            judgment of counsel to the Depositor, satisfy any disclosure
            requirements applicable to Party A, and cause such affiliate to
            provide 20% Financial Disclosure and (B) provide an indemnity to the
            Depositor, reasonably satisfactory to the Depositor, in relation to
            the 20% Financial Disclosure. Any such 20% Financial Disclosure
            provided pursuant to this paragraph (v) shall be in a form suitable
            for conversion to the format required for filing by the Depositor
            with the Securities and Exchange Commission via the Electronic Data
            Gathering and Retrieval System (EDGAR). If permitted by Regulation
            AB, any required 20% Financial Disclosure may be provided by
            incorporation by reference from reports filed pursuant to the
            Securities Exchange Act.

(f)   Transfers.

      (i)   Section 7 is hereby amended to read in its entirety as follows:

            "Neither this Agreement nor any interest or obligation in or under
            this Agreement may be transferred (whether by way of security or
            otherwise) by either party unless (a) the prior written consent of
            the other party is obtained and (b) the Rating Agency Condition has
            been satisfied with respect to Fitch, except that:

                  (a)   Party A may make a Permitted Transfer (1) pursuant to
                        Section 6(b)(ii), (2) pursuant to a consolidation or
                        amalgamation with, or merger with or into, or transfer
                        of all or substantially all its assets to, another
                        entity (but without prejudice to any other right or
                        remedy under this Agreement), or (3) at any time at
                        which no Relevant Entity has credit ratings at least
                        equal to the Approved Ratings Threshold;

                  (b)   Party B may transfer its rights and obligations
                        hereunder in connection with a transfer pursuant to
                        Section 6.06 of the PSA.

                  (c)   a party may make such a transfer of all or any part of
                        its interest in any amount payable to it from a
                        Defaulting Party under Section 6(e).

                  Any purported transfer that is not in compliance with this
                  Section will be void."

      (ii)  If an Eligible Replacement has made a Firm Offer (which remains an
            offer that will become legally binding upon acceptance by Party B)
            to be the transferee pursuant to a Permitted Transfer, Party B
            shall, at Party A's written request and at Party A's expense,
            execute such documentation provided to it as reasonably determined
            necessary by Party A to effect such transfer.

(g)   Non-Recourse. Party A acknowledges and agrees that, notwithstanding any
      provision in this Agreement to the contrary, the obligations of Party B
      hereunder are limited recourse obligations of Party B, payable solely from
      the trust estate created pursuant to the PSA (the "Trust Estate") and the
      proceeds thereof, in accordance with the priority of payments and other
      terms of the PSA and that Party A will not have any recourse to any of the
      directors, officers, agents, employees, shareholders or affiliates of the
      Party B with respect to any claims, losses, damages, liabilities,
      indemnities or other obligations in connection with any transactions
      contemplated hereby. In the event that the Trust Estate and the proceeds
      thereof should be insufficient to satisfy all claims outstanding and
      following the realization thereof in accordance with the PSA, any claims
      against or obligations of Party B under the ISDA Master Agreement or any
      other confirmation thereunder still outstanding shall be extinguished and
      thereafter not revive. The Master Servicer shall not have liability for
      any failure or delay in making a payment hereunder to Party A due to any
      failure or delay in receiving amounts forming part of the Trust Estate.
      This provision will survive the termination of this Agreement.

(h)   Timing of Payments by Party B upon Early Termination. Notwithstanding
      anything to the contrary in Section 6(d)(ii), to the extent that all or a
      portion (in either case, the "Unfunded Amount") of any amount that is
      calculated as being due in respect of any Early Termination Date under
      Section 6(e) from Party B to Party A will be paid by Party B from amounts
      other than any upfront payment paid to Party B by an Eligible Replacement
      that has entered into a Replacement Transaction with Party B, then such
      Unfunded Amount shall be due on the Business Day prior to the next
      subsequent Distribution Date following the date on which the payment would
      have been payable as determined in accordance with Section 6(d)(ii), and
      on the Business Day prior to any subsequent Distribution Dates until paid
      in full (or if such Early Termination Date is the final Distribution Date,
      on such final Distribution Date); provided, however, that if the date on
      which the payment would have been payable as determined in accordance with
      Section 6(d)(ii) is a Distribution Date, such payment will be payable on
      the Business Day prior to such Distribution Date.

(i)   Rating Agency Notifications. Notwithstanding any other provision of this
      Agreement, no Early Termination Date shall be effectively designated
      hereunder by Party B and no transfer of any rights or obligations under
      this Agreement shall be made by either party unless each Rating Agency has
      been provided prior written notice of such designation or transfer.

(j)   No Set-off. Except as expressly provided for in Section 2(c), Section 6 or
      Part 1(f)(i)(D) hereof, and notwithstanding any other provision of this
      Agreement or any other existing or future agreement, each party
      irrevocably waives any and all rights it may have to set off, net, recoup
      or otherwise withhold or suspend or condition payment or performance of
      any obligation between it and the other party hereunder against any
      obligation between it and the other party under any other agreements.
      Section 6(e) shall be amended by deleting the following sentence: "The
      amount, if any, payable in respect of an Early Termination Date and
      determined pursuant to this Section will be subject to any Set-off.".

(k)   Amendment. Notwithstanding any provision to the contrary in this
      Agreement, no amendment of either this Agreement or any Transaction under
      this Agreement shall be permitted by either party unless each of the
      Rating Agencies has been provided prior written notice of the same and the
      Rating Agency Condition is satisfied with respect to Fitch.

(l)   Notice of Certain Events or Circumstances. Each Party agrees, upon
      learning of the occurrence or existence of any event or condition that
      constitutes (or that with the giving of notice or passage of time or both
      would constitute) an Event of Default or Termination Event with respect to
      such party, promptly to give the other Party and to each Rating Agency
      notice of such event or condition; provided that failure to provide notice
      of such event or condition pursuant to this Part 5(l) shall not constitute
      an Event of Default or a Termination Event.

(m)   Proceedings. No Relevant Entity shall institute against, or cause any
      other person to institute against, or join any other person in instituting
      against Party B or the trust formed pursuant to the PSA, in any
      bankruptcy, reorganization, arrangement, insolvency or liquidation
      proceedings or other proceedings under any federal or state bankruptcy or
      similar law for a period of one year (or, if longer, the applicable
      preference period) and one day following payment in full of the
      Certificates. This provision will survive the termination of this
      Agreement.

(n)   Master Servicer Liability Limitations. It is expressly understood and
      agreed by the parties hereto that (a) this Agreement is executed and
      delivered by Wells Fargo Bank, N.A. not in its individual capacity, but
      solely as Master Servicer under the PSA in the exercise of the powers and
      authority conferred and vested in it thereunder; (b) Wells Fargo Bank,
      N.A. has been directed pursuant to the PSA to enter into this Agreement
      and to perform its obligations hereunder; (c) each of the representations,
      warranties, covenants, undertakings and agreements herein made on behalf
      of the Supplemental Interest Trust is made and intended not as a personal
      representation of the Master Servicer but is made and intended for the
      purpose of binding only the Supplemental Interest Trust; and (d) nothing
      herein contained shall be construed as creating any liability on Wells
      Fargo Bank, N.A., individually or personally, to perform any covenant
      either expressed or implied contained herein (including, for the avoidance
      of doubt, any liability, individually or personally, for any failure or
      delay in making a payment hereunder to Party A due to any failure or delay
      in receiving amounts held in the account held by the Supplemental Interest
      Trust created pursuant to the PSA or any inability to provide any correct
      withholding certificate from a Certificateholder provided to the Master
      Servicer), all such liability, if any, being expressly waived by the
      parties who are signatories to this Agreement and by any person claiming
      by, through or under such parties and (e) under no circumstances shall
      Wells Fargo Bank, N.A. in its individual capacity be personally liable for
      the payment of any indemnity, indebtedness, fees or expenses of the
      Supplemental Interest Trust or any payments hereunder or for the breach or
      failure of any obligation, representation, warranty or covenant made or
      undertaken under this Agreement or any other related documents, as to all
      of which recourse shall be had solely to the Trust Estate in accordance
      with the terms of the PSA.

(o)   Severability. If any term, provision, covenant, or condition of this
      Agreement, or the application thereof to any party or circumstance, shall
      be held to be invalid or unenforceable (in whole or in part) in any
      respect, the remaining terms, provisions, covenants, and conditions hereof
      shall continue in full force and effect as if this Agreement had been
      executed with the invalid or unenforceable portion eliminated, so long as
      this Agreement as so modified continues to express, without material
      change, the original intentions of the parties as to the subject matter of
      this Agreement and the deletion of such portion of this Agreement will not
      substantially impair the respective benefits or expectations of the
      parties; provided, however, that this severability provision shall not be
      applicable if any provision of Section 2, 5, 6, or 13 (or any definition
      or provision in Section 14 to the extent it relates to, or is used in or
      in connection with any such Section) shall be so held to be invalid or
      unenforceable.

      The parties shall endeavor to engage in good faith negotiations to replace
      any invalid or unenforceable term, provision, covenant or condition with a
      valid or enforceable term, provision, covenant or condition, the economic
      effect of which comes as close as possible to that of the invalid or
      unenforceable term, provision, covenant or condition.

(p)   Agent for Party B. Party A acknowledges the appointment of the Master
      Servicer under PSA to carry out certain functions on behalf of Party B,
      and that the Master Servicer shall be entitled to give notices and to
      perform and satisfy the obligations of Party B hereunder on behalf of
      Party B.

(q)   Reserved.

(r)   Consent to Recording. Each party hereto consents to the monitoring or
      recording, at any time and from time to time, by the other party of any
      and all communications between trading, marketing, and operations
      personnel of the parties and their Affiliates, waives any further notice
      of such monitoring or recording, and agrees to notify such personnel of
      such monitoring or recording. Each party agrees to provide such recording
      to the other party upon reasonable request.

(s)   Waiver of Jury Trial. Each party waives any right it may have to a trial
      by jury in respect of any suit, action or proceeding relating to this
      Agreement or any Credit Support Document.

(t)   Form of ISDA Master Agreement. Party A and Party B hereby agree that the
      text of the body of the ISDA Master Agreement is intended to be the
      printed form of the ISDA Master Agreement (Multicurrency - Crossborder) as
      published and copyrighted in 1992 by the International Swaps and
      Derivatives Association, Inc.

(u)   Payment Instructions. Party A hereby agrees that, unless notified in
      writing by Party B of other payment instructions, any and all amounts
      payable by Party A to Party B under this Agreement shall be paid to the
      account specified in Item 4 of this Long-form Confirmation, below.

(v)   Additional representations.

      (i)   Representations of Party A. Party A represents to Party B on the
            date on which Party A enters into the Transaction that:--

            (1)   Party A's obligations under this Agreement rank pari passu
                  with all of Party A's other unsecured, unsubordinated
                  obligations except those obligations preferred by operation of
                  law.

            (2)   Party A is a bank subject to the requirements of 12 U.S.C. ss.
                  1823(e), its execution, delivery and performance of this
                  Agreement (including the Credit Support Annex and each
                  Confirmation) have been approved by its board of directors or
                  its loan committee, such approval is reflected in the minutes
                  of said board of directors or loan committee, and this
                  Agreement (including the Credit Support Annex and each
                  Confirmation) will be maintained as one of its official
                  records continuously from the time of its execution (or in the
                  case of any Confirmation, continuously until such time as the
                  relevant Transaction matures and the obligations therefore are
                  satisfied in full).

      (ii)  Capacity. Party A represents to Party B on the date on which Party A
            enters into the Transaction that it is entering into the Agreement
            and the Transaction as principal and not as agent of any person. The
            Master Servicer represents to Party A on the date on which the
            Master Servicer executes this Agreement that it is executing the
            Agreement not in its individual capacity, but solely as Master
            Servicer under the PSA.

(w)   Acknowledgements.

      (i)   Substantial financial transactions. Each party hereto is hereby
            advised and acknowledges as of the date hereof that the other party
            has engaged in (or refrained from engaging in) substantial financial
            transactions and has taken (or refrained from taking) other material
            actions in reliance upon the entry by the parties into the
            Transaction being entered into on the terms and conditions set forth
            herein and in the PSA relating to such Transaction, as applicable.
            This paragraph is deemed repeated on the trade date of the
            Transaction.

      (ii)  Bankruptcy Code. Subject to Part 5(m), without limiting the
            applicability if any, of any other provision of the U.S. Bankruptcy
            Code as amended (the "Bankruptcy Code") (including without
            limitation Sections 362, 546, 556, and 560 thereof and the
            applicable definitions in Section 101 thereof), the parties
            acknowledge and agree that all Transactions entered into hereunder
            will constitute "forward contracts" or "swap agreements" as defined
            in Section 101 of the Bankruptcy Code or "commodity contracts" as
            defined in Section 761 of the Bankruptcy Code, that the rights of
            the parties under Section 6 of this Agreement will constitute
            contractual rights to liquidate Transactions, that any margin or
            collateral provided under any margin, collateral, security, pledge,
            or similar agreement related hereto will constitute a "margin
            payment" as defined in Section 101 of the Bankruptcy Code, and that
            the parties are entities entitled to the rights under, and
            protections afforded by, Sections 362, 546, 556, and 560 of the
            Bankruptcy Code.

(x)   Reserved.

(y)   Reserved.

(z)   Additional Definitions.

      As used in this Agreement, the following terms shall have the meanings set
      forth below, unless the context clearly requires otherwise:

      "Approved Ratings Threshold" means each of the Moody's First Trigger
      Ratings Threshold and the Fitch First Trigger Ratings Threshold.

      "Approved Replacement" means, with respect to a Market Quotation, an
      entity making such Market Quotation, which entity would satisfy conditions
      (a), (b), (c) and (d) of the definition of Permitted Transfer if such
      entity were a Transferee, as defined in the definition of Permitted
      Transfer.

      "Derivative Provider Trigger Event" means (i) an Event of Default with
      respect to which Party A is a Defaulting Party, (ii) a Termination Event
      with respect to which Party A is the sole Affected Party or (iii) an
      Additional Termination Event with respect to which Party A is the sole
      Affected Party.

      "Eligible Guarantee" means an unconditional and irrevocable guarantee of
      all present and future obligations of Party A under this Agreement (or,
      solely for purposes of the definition of Eligible Replacement, all present
      and future obligations of such Eligible Replacement under this Agreement
      or its replacement, as applicable) which is provided by a guarantor as
      principal debtor rather than surety and which is directly enforceable by
      Party B (together with a legal opinion from a law firm confirming the
      enforceability of the guarantee) the form and substance of which guarantee
      and legal opinion are subject to the Rating Agency Condition with respect
      to Fitch, and either (A) a law firm has given a legal opinion confirming
      that none of the guarantor's payments to Party B under such guarantee will
      be subject to deduction or Tax collected by withholding and such opinion
      has been delivered to Moody's and Fitch, or (B) such guarantee provides
      that, in the event that any of such guarantor's payments to Party B are
      subject to deduction or Tax collected by withholding, such guarantor is
      required to pay such additional amount as is necessary to ensure that the
      net amount actually received by Party B (free and clear of any Tax
      collected by withholding) will equal the full amount Party B would have
      received had no such deduction or withholding been required, or (C) in the
      event that any payment under such guarantee is made net of deduction or
      withholding for Tax, Party A is required, under Section 2(a)(i), to make
      such additional payment as is necessary to ensure that the net amount
      actually received by Party B from the guarantor will equal the full amount
      Party B would have received had no such deduction or withholding been
      required.

      "Eligible Replacement" means an entity (A) that lawfully could perform the
      obligations owing to Party B under this Agreement (or its replacement, as
      applicable), and (B) (I) (x) which has credit ratings from Moody's at
      least equal to the Moody's Second Trigger Ratings Threshold or (y) all
      present and future obligations of which entity owing to Party B under this
      Agreement (or its replacement, as applicable) are guaranteed pursuant to
      an Eligible Guarantee provided by a guarantor with credit ratings from
      Moody's at least equal to the Moody's Second Trigger Ratings Threshold, in
      either case if Moody's is a Rating Agency, and (II) (x) which has a
      long-term unsecured and unsubordinated debt rating from Fitch of at least
      "AA-" and a short-term unsecured and unsubordinated debt rating from Fitch
      of "F1" or (y) all present and future obligations of which entity owing to
      Party B under this Agreement (or its replacement, as applicable) are
      guaranteed pursuant to an Eligible Guarantee provided by a guarantor with
      a long-term unsecured and unsubordinated debt rating from Fitch of at
      least "AA-" and a short-term unsecured and unsubordinated debt rating from
      Fitch of "F1", in either case if Fitch is a Rating Agency. All credit
      ratings described in this definition of Eligible Replacement shall be
      provided to Party B in writing if requested by Party B.

      "Estimated Swap Termination Payment" means, with respect to an Early
      Termination Date, an amount determined by Party A in good faith and in a
      commercially reasonable manner as the maximum payment that could be owed
      by Party B to Party A in respect of such Early Termination Date pursuant
      to Section 6(e) (as amended herein), taking into account then current
      market conditions.

      "Financial Institution" means a bank, broker/dealer, insurance company,
      structured investment company or derivative product company.

      "Firm Offer" means a quotation from an Eligible Replacement (i) in an
      amount equal to the actual amount payable by or to Party B in
      consideration of an agreement between Party B and such Eligible
      Replacement to replace Party A as the counterparty to this Agreement by
      way of novation or, if such novation is not possible, an agreement between
      Party B and such Eligible Replacement to enter into a Replacement
      Transaction (assuming that all Transactions hereunder become Terminated
      Transactions), and (ii) that constitutes an offer by such Eligible
      Replacement to replace Party A as the counterparty to this Agreement or
      enter a Replacement Transaction that will become legally binding upon such
      Eligible Replacement upon acceptance by Party B.

      "Fitch" means Fitch Ratings Ltd., or any successor thereto.

      "Fitch First Trigger Ratings Threshold" means, with respect to Party A,
      the guarantor under an Eligible Guarantee, or an Eligible Replacement, a
      long-term unsecured and unsubordinated debt rating from Fitch of "A" and a
      short-term unsecured and unsubordinated debt rating from Fitch of "F1".

      "Fitch Second Trigger Downgrade Event" means that no Relevant Entity has
      credit ratings from Fitch at least equal to the Fitch Second Trigger
      Ratings Threshold.

      "Fitch Second Trigger Ratings Threshold" means, with respect to Party A,
      the guarantor under an Eligible Guarantee, or an Eligible Replacement, a
      long-term unsecured and unsubordinated debt rating from Fitch of "A-" and
      a short-term unsecured and unsubordinated debt rating from Fitch of "F2".

      "Moody's" means Moody's Investors Service, Inc., or any successor thereto.

      "Moody's First Trigger Ratings Threshold" means, with respect to Party A,
      the guarantor under an Eligible Guarantee, or an Eligible Replacement, (i)
      if such entity has a short-term unsecured and unsubordinated debt rating
      from Moody's, a long-term unsecured and unsubordinated debt rating or
      counterparty rating from Moody's of "A2" and a short-term unsecured and
      unsubordinated debt rating from Moody's of "Prime-1", or (ii) if such
      entity does not have a short-term unsecured and unsubordinated debt rating
      or counterparty rating from Moody's, a long-term unsecured and
      unsubordinated debt rating or counterparty rating from Moody's of "A1".

      "Moody's Second Trigger Downgrade Event" means that no Relevant Entity has
      credit ratings from Moody's at least equal to the Moody's Second Trigger
      Ratings Threshold.

      "Moody's Second Trigger Ratings Threshold" means, with respect to Party A,
      the guarantor under an Eligible Guarantee, or an Eligible Replacement, (i)
      if such entity has a short-term unsecured and unsubordinated debt rating
      from Moody's, a long-term unsecured and unsubordinated debt rating or
      counterparty rating from Moody's of "A3" and a short-term unsecured and
      unsubordinated debt rating from Moody's of "Prime-2", or (ii) if such
      entity does not have a short-term unsecured and unsubordinated debt rating
      from Moody's, a long-term unsecured and unsubordinated debt rating or
      counterparty rating from Moody's of "A3".

      "Permitted Transfer" means a transfer by novation by Party A, pursuant to
      Section 6(b)(ii) which is described in Sections 7(a)(2) or (3) (as amended
      herein), to a transferee (the "Transferee") of Party A's rights,
      liabilities, duties and obligations under this Agreement, with respect to
      which transfer each of the following conditions is satisfied: (a) the
      Transferee is an Eligible Replacement; (b) Party A and the Transferee are
      both "dealers in notional principal contracts" within the meaning of
      Treasury regulations section 1.1001-4; (c) as of the date of such transfer
      the Transferee would not be required to withhold or deduct on account of
      Tax from any payments under this Agreement or would be required to gross
      up for such Tax under Section 2(d)(i)(4); (d) an Event of Default or
      Termination Event would not occur as a result of such transfer; (e) the
      Transferee contracts with Party B pursuant to a written instrument (the
      "Transfer Agreement") (A) (i) on terms which are effective to transfer to
      the Transferee all, but not less than all, of Party A's rights,
      liabilities, duties and obligations under the Agreement and all relevant
      Transactions, which terms are identical to the terms of this Agreement,
      other than party names, dates relevant to the effective date of such
      transfer, tax representations (provided that the representations in Part
      2(a)(i) are not modified) and any other representations regarding the
      status of the substitute counterparty of the type included in Part
      5(b)(iv), Part 5(v)(i)(2) or Part 5(v)(ii), notice information and account
      details, and (ii) each Rating Agency has been given prior written notice
      of such transfer, or (B) (i) on terms that (x) have the effect of
      preserving for Party B the economic equivalent of all payment and delivery
      obligations (whether absolute or contingent and assuming the satisfaction
      of each applicable condition precedent) under this Agreement immediately
      before such transfer and (y) are, in all material respects, no less
      beneficial for Party B than the terms of this Agreement immediately before
      such transfer, as determined by Party B, and (ii) Moody's has been given
      prior written notice of such transfer and the Rating Agency Condition is
      satisfied with respect to Fitch; (f) Party A will be responsible for any
      costs or expenses incurred in connection with such transfer (including any
      replacement cost of entering into a replacement transaction); and (g) such
      transfer otherwise complies with the terms of the PSA.

      "Rating Agencies" mean, with respect to any date of determination, each of
      Moody's and Fitch, to the extent that each such rating agency is then
      providing a rating for any of the Wells Fargo Mortgage Backed Securities
      2008-AR1 Trust, Mortgage Pass-Through Certificates, Series 2008-AR1 (the
      "Certificates").

      "Rating Agency Condition" means, with respect to any particular proposed
      act or omission to act hereunder and each Rating Agency specified in
      connection with such proposed act or omission, that the party proposing
      such act or failure to act must consult with each of the specified Rating
      Agencies and receive from each such Rating Agency prior written
      confirmation that the proposed action or inaction would not cause a
      downgrade or withdrawal of the then-current rating of any Certificates.

      "Relevant Entities" mean Party A and, to the extent applicable, a
      guarantor under an Eligible Guarantee.

      "Replacement Transaction" means, with respect to any Terminated
      Transaction or group of Terminated Transactions, a transaction or group of
      transactions that (A) has terms which would be effective to transfer to a
      transferee all, but not less than all, of Party A's rights, liabilities,
      duties and obligations under this Agreement and all relevant Transactions,
      which terms are identical to the terms of this Agreement, other than party
      names, dates relevant to the effective date of such transfer, tax
      representations (provided that the representations in Part 2(a)(i) are not
      modified) and any other representations regarding the status of the
      substitute counterparty of the type included in Part 5(b)(iv), Part
      5(v)(i)(2) or Part 5(v)(ii), notice information and account details, save
      for the exclusion of provisions relating to Transactions that are not
      Terminated Transactions, or (B) (x) would have the effect of preserving
      for Party B the economic equivalent of any payment or delivery (whether
      the underlying obligation was absolute or contingent and assuming the
      satisfaction of each applicable condition precedent) under this Agreement
      in respect of such Terminated Transaction or group of Terminated
      Transactions that would, but for the occurrence of the relevant Early
      Termination Date, have been required after that date, and (y) has terms
      which are, in all material respects, no less beneficial for Party B than
      those of this Agreement (save for the exclusion of provisions relating to
      Transactions that are not Terminated Transactions), as determined by Party
      B.

      "Required Ratings Downgrade Event" means that no Relevant Entity has
      credit ratings at least equal to the Required Ratings Threshold.

      "Required Ratings Threshold" means each of the Moody's Second Trigger
      Ratings Threshold and the Fitch Second Trigger Ratings Threshold.

              [Remainder of this page intentionally left blank.]

<PAGE>

Item 4.     Account Details and Settlement Information:

            Payments to Party A:
            A/C With:               DB Trust Co. Americas, New York
            Swift Code:             BKTRUUS33 / ABA 021001033
            Favour of:              Deutsche Bank AG, New York
            Account Number:         01 473 969
            Reference:              N764066N

            Payments to Party B:

                                    Wells Fargo Bank, N.A.
            ABA #:                  121000248
            Account Number:         3970771416
            Account Name:           SAS Clearing
            Reference:              53192901; WFMBS 2008-AR1 Supplemental
                                    Interest Trust Account

This Agreement may be executed in several counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument. We are very pleased to have executed this Transaction with you and
we look forward to completing other transactions with you in the near future.

Very truly yours,

DEUSTCHE BANK AG, NEW YORK BRANCH

By:   /s/ Ernest Calabrese
   --------------------------------------
   Name:  Ernest Calabrese
   Title: Director

Very truly yours,

DEUSTCHE BANK AG, NEW YORK BRANCH

By:   /s/ Susan Valenti
   --------------------------------------
   Name:  Susan Valenti
   Title: Director

Party B, acting through its duly authorized signatory, hereby agrees to, accepts
and confirms the terms of the foregoing as of the date hereof.

WELLS FARGO BANK, N.A., NOT INDIVIDUALLY, BUT SOLELY AS MASTER SERVICER ON
BEHALF OF THE SUPPLEMENTAL INTEREST TRUST IN RESPECT OF WELLS FARGO MORTGAGE
BACKED SECURITIES 2008-AR1 TRUST

By:   /s/ Stacey M. Taylor
   --------------------------------------
   Name:  Stacey M. Taylor
   Title: Vice President

Chairman of the Supervisory Board: Clemens Borsig
Management Board: Josef Ackermann (Chairman), Hugo Banziger, Tessen von
Heydebreck, Anthony Di Iorio, Hermann-Josef Lamberti

<PAGE>

                                     Annex A

                    Paragraph 13 of the Credit Support Annex

<PAGE>

                                     ISDA(R)
                              CREDIT SUPPORT ANNEX
                             to the Schedule to the
                              ISDA Master Agreement
                      dated as of February 27, 2008 between
   Deutsche Bank AG, New York Branch (hereinafter referred to as "Party A" or
                                   "Pledgor")
                                       and
   Wells Fargo Bank, N.A., not individually, but solely as Master Servicer on
  behalf of the Supplemental Interest Trust in respect of Wells Fargo Mortgage
    Backed Securities 2008-AR1 Trust (hereinafter referred to as "Party B" or
                                "Secured Party").

  For the avoidance of doubt, and notwithstanding anything to the contrary that
may be contained in the Agreement, this Credit Support Annex shall relate solely
   to the Transaction documented in the Confirmation dated February 27, 2008,
             between Party A and Party B, Reference Number N764066N.

Paragraph 13. Elections and Variables.

(a)   Security Interest for "Obligations". The term "Obligations" as used in
      this Annex includes the following additional obligations:

      With respect to Party A: not applicable.

      With respect to Party B: not applicable.

(b)   Credit Support Obligations.

      (i)   Delivery Amount, Return Amount and Credit Support Amount.

            (A)   "Delivery Amount" has the meaning specified in Paragraph 3(a),
                  except that:

                  (I)   the words "upon a demand made by the Secured Party on or
                        promptly following a Valuation Date" shall be deleted
                        and replaced with the words "not later than the close of
                        business on each Valuation Date",

                  (II)  the sentence beginning "Unless otherwise specified in
                        Paragraph 13" and ending "(ii) the Value as of that
                        Valuation Date of all Posted Credit Support held by the
                        Secured Party." shall be deleted in its entirety and
                        replaced with the following:

                        "The "Delivery Amount" applicable to the Pledgor for any
                        Valuation Date will equal the greatest of

                        (1)   the amount by which (a) the Moody's Credit Support
                              Amount for such Valuation Date exceeds (b) the
                              Moody's Value, as of such Valuation Date, of all
                              Posted Credit Support held by the Secured Party,
                              and

                        (2)   the amount by which (a) the Fitch Credit Support
                              Amount for such Valuation Date exceeds (b) the
                              Fitch Value, as of such Valuation Date, of all
                              Posted Credit Support held by the Secured Party,
                              and

                  (III) if, on any Valuation Date, the Delivery Amount equals or
                        exceeds the Pledgor's Minimum Transfer Amount, the
                        Pledgor will Transfer to the Secured Party sufficient
                        Eligible Credit Support to ensure that, immediately
                        following such transfer, the Delivery Amount shall be
                        zero.

            (B)   "Return Amount" has the meaning specified in Paragraph 3(b),
                  except that:

                  (I)   the sentence beginning "Unless otherwise specified in
                        Paragraph 13" and ending "(ii) the Credit Support
                        Amount." shall be deleted in its entirety and replaced
                        with the following:

                        "The "Return Amount" applicable to the Secured Party for
                        any Valuation Date will equal the least of

                        (1)   the amount by which (a) the Moody's Value, as of
                              such Valuation Date, of all Posted Credit Support
                              held by the Secured Party exceeds (b) the Moody's
                              Credit Support Amount for such Valuation Date, and

                        (2)   the amount by which (a) the Fitch Value, as of
                              such Valuation Date, of all Posted Credit Support
                              held by the Secured Party exceeds (b) the Fitch
                              Credit Support Amount for such Valuation Date, and

                  (II)  in no event shall the Secured Party be required to
                        Transfer any Posted Credit Support under Paragraph 3(b)
                        if, immediately following such transfer, the Delivery
                        Amount would be greater than zero.

            (C)   "Credit Support Amount" shall not apply. For purposes of
                  calculating any Delivery Amount or Return Amount for any
                  Valuation Date, reference shall be made to the Moody's Credit
                  Support Amount or the Fitch Credit Support Amount, in each
                  case for such Valuation Date, as provided in Paragraphs
                  13(b)(i)(A) and 13(b)(i)(B), above.

      (ii)  Eligible Collateral.

      On any date, the following items will qualify as "Eligible Collateral"
      (for the avoidance of doubt, all Eligible Collateral to be denominated in
      USD):

                   Moody's      Moody's
                    First       Second
                   Trigger      Trigger       Fitch
                  Valuation    Valuation    Valuation
   Collateral     Percentage   Percentage   Percentage
   ----------     ----------   ----------   ----------

(A) Cash             100%         100%         100%

(B) Fixed-rate       100%         100%        99.5%
negotiable debt
obligations
issued by the
U.S. Treasury
Department
having a
remaining
maturity on
such date of
not more than
one year

(C) Fixed-rate       100%          94%        93.9%
negotiable debt
obligations
issued by the
U.S. Treasury
Department
having a
remaining
maturity on
such date of
more than one
year but not
more than ten
years

(D) Fixed-rate       100%          87%        92.7%
negotiable debt
obligations
issued by the
U.S. Treasury
Department
having a
remaining
maturity on
such date of
more than ten
years but not
more than 15
years

      (iii) Other Eligible Support.

            The following items will qualify as "Other Eligible Support" for the
            party specified:

            Not applicable.

      (iv)  Threshold.

            (A)   "Independent Amount" means zero with respect to Party A and
                  Party B.

            (B)   "Moody's Threshold" means, with respect to Party A and any
                  Valuation Date, if a Moody's First Trigger Downgrade Event has
                  occurred and is continuing and such Moody's First Trigger
                  Downgrade Event has been continuing (i) for at least 30 Local
                  Business Days or (ii) since this Annex was executed, zero;
                  otherwise, infinity.

            (C)   "Fitch Threshold" means, with respect to Party A and any
                  Valuation Date, if a Fitch First Trigger Downgrade Event has
                  occurred and is continuing and such Fitch First Trigger
                  Downgrade Event has been continuing (i) for at least 30
                  calendar days or (ii) since this Annex was executed, zero;
                  otherwise, infinity.

            (D)   "Threshold" means, with respect to Party B and any Valuation
                  Date, infinity.

            (E)   "Minimum Transfer Amount" means USD 25,000 with respect to
                  Party A and Party B.

            (F)   Rounding: The Delivery Amount will be rounded up to the
                  nearest integral multiple of USD 10,000. The Return Amount
                  will be rounded down to the nearest integral multiple of USD
                  10,000.

(c)   Valuation and Timing.

      (i)   "Valuation Agent" means Party A; provided, however, that if an Event
            of Default shall have occurred with respect to which Party A is the
            Defaulting Party, Party B shall have the right to designate as
            Valuation Agent an independent party, reasonably acceptable to Party
            A, the cost for which shall be borne by Party A. All calculations by
            the Valuation Agent must be made in accordance with standard market
            practice, including, in the event of a dispute as to the Value of
            any Eligible Credit Support or Posted Credit Support, by making
            reference to quotations received by the Valuation Agent from one or
            more Pricing Sources.

      (ii)  "Valuation Date" means the first Local Business Day in each week on
            which any of the Moody's Threshold or the Fitch Threshold is zero.

      (iii) "Valuation Time" means the close of business in the city of the
            Valuation Agent on the Local Business Day immediately preceding the
            Valuation Date or date of calculation, as applicable; provided that
            the calculations of Value and Exposure will be made as of
            approximately the same time on the same date. The Valuation Agent
            will notify each party (or the other party, if the Valuation Agent
            is a party) of its calculations not later than the Notification Time
            on the applicable Valuation Date (or in the case of Paragraph 6(d),
            the Local Business Day following the day on which such relevant
            calculations are performed)."

      (iv)  "Notification Time" means 11:00 a.m., New York time, on a Local
            Business Day.

      (v)   External Verification. Notwithstanding anything to the contrary in
            the definitions of Valuation Agent or Valuation Date, at any time at
            which no Relevant Entity has credit ratings from Fitch at least
            equal to a Fitch Intermediate Trigger Downgrade Event has occurred
            and is continuing, the Valuation Agent shall (A) calculate the Fitch
            Value of Posted Credit Support and the Secured Party's Exposure on
            each Valuation Date based on internal marks and (B) verify such
            calculations with external marks weekly by obtaining on the last
            Local Business Day of each calendar week one external mark for each
            Transaction to which this Annex relates and for all Posted Credit
            Support. Each external mark in respect of a Transaction shall be
            obtained from an independent Reference Market-maker. The Valuation
            Agent shall obtain these external marks directly or through an
            independent third party, in either case at no cost to Party B. The
            Valuation Agent shall calculate on each Valuation Date (for purposes
            of this paragraph, the last Local Business Day in each calendar week
            shall be considered a Valuation Date) the Secured Party's Exposure
            and the Fitch Value of Posted Collateral based on the greater of the
            Valuation Agent's internal marks and the external mark received.

(d)   Conditions Precedent and Secured Party's Rights and Remedies. The
      following Termination Events will be a "Specified Condition" for the party
      specified (that party being the Affected Party if the Termination Event
      occurs with respect to that party): With respect to Party A: any
      Additional Termination Event with respect to which Party A is the sole
      Affected Party. With respect to Party B: None.

(e)   Substitution.

      (i)   "Substitution Date" has the meaning specified in Paragraph 4(d)(ii).

      (ii)  Consent. If specified here as applicable, then the Pledgor must
            obtain the Secured Party's consent for any substitution pursuant to
            Paragraph 4(d): Inapplicable.

(f)   Dispute Resolution.

      (i)   "Resolution Time" means 1:00 p.m. New York time on the Local
            Business Day following the date on which the notice of the dispute
            is given under Paragraph 5.

      (ii)  Value. Notwithstanding anything to the contrary in Paragraph 12, for
            the purpose of Paragraphs 5(i)(C) and 5(ii), the Moody's Value and
            Fitch Value on any date, of Eligible Collateral will be calculated
            as follows:

            For Eligible Collateral other than Cash listed in Paragraph
            13(b)(ii): the sum of (A) the product of (1)(x) the bid price at the
            Valuation Time for such securities on the principal national
            securities exchange on which such securities are listed, or (y) if
            such securities are not listed on a national securities exchange,
            the bid price for such securities quoted at the Valuation Time by
            any principal market maker for such securities selected by the
            Valuation Agent, or (z) if no such bid price is listed or quoted for
            such date, the bid price listed or quoted (as the case may be) at
            the Valuation Time for the day next preceding such date on which
            such prices were available and (2) the applicable Valuation
            Percentage for such Eligible Collateral, and (B) the accrued
            interest on such securities (except to the extent Transferred to the
            Pledgor pursuant to Paragraph 6(d)(ii) or included in the applicable
            price referred to in the immediately preceding clause (A)) as of
            such date.

      (iii) Alternative. The provisions of Paragraph 5 will apply.

(g)   Holding and Using Posted Collateral.

      (i)   Eligibility to Hold Posted Collateral; Custodians. Party B (or any
            Custodian) will be entitled to hold Posted Collateral pursuant to
            Paragraph 6(b).

            Party B may appoint as Custodian (A) the entity then serving as
            Supplemental Interest Trustee or (B) any entity other than the
            entity then serving as Supplemental Interest Trustee if such other
            entity (or, to the extent applicable, its parent company or credit
            support provider) (i) shall then have credit ratings from Fitch at
            least equal to the Custodian Required Rating Threshold, and (ii) is
            a depository institution that (a) is subject to supervision or
            examination by a federal or state authority, (b) has a combined
            capital and surplus of at least $15 million and (c) is qualified to
            do business in New York. If any entity referred to in clause (B)
            above is the Custodian for Party B and such entity fails after its
            appointment as Custodian to meet the Custodian Required Rating
            Threshold, Party B shall replace such Custodian with an entity
            meeting the applicable requirements above within 60 days following
            such failure to meet the Custodian Required Rating Threshold. For
            the avoidance of doubt, if Wells Fargo Bank, N.A. is serving as
            Supplemental Interest Trustee, the requirement to meet the Custodian
            Required Rating Threshold shall not apply.

            Initially, the Custodian for Party B is: Supplemental Interest
            Trustee.

      (ii)  Use of Posted Collateral. The provisions of Paragraph 6(c) will not
            apply to Party B or its Custodian; provided, however, that if Party
            A delivers Posted Collateral in book-entry form, then Paragraph
            6(c)(ii) will apply to Party B and its Custodian, and Party B and
            its Custodian shall have the rights specified in Paragraph 6(c)(ii).

(h)   Distributions and Interest Amount.

      (i)   Interest Rate. The "Interest Rate" will be the actual interest rate
            earned on Posted Collateral in the form of Cash that is held by
            Party B or its Custodian. Posted Collateral in the form of Cash
            shall be invested in such overnight (or redeemable within two Local
            Business Days of demand) Permitted Investments rated at least
            Prime-1 by Moody's or Aaa by Moody's, as directed by Party A (unless
            (x) an Event of Default or an Additional Termination Event has
            occurred with respect to which Party A is the defaulting or sole
            Affected Party or (y) an Early Termination Date has been designated,
            in which case such Posted Collateral shall be held uninvested). If
            no investment direction is provided by Party A, such funds shall
            remain uninvested. Gains and losses incurred in respect of any
            investment of Posted Collateral in the form of Cash in Permitted
            Investments as directed by Party A shall be for the account of Party
            A.

      (ii)  Transfer of Interest Amount. The Transfer of the Interest Amount
            will be made on the second Local Business Day following the end of
            each calendar month and on any other Local Business Day on which
            Posted Collateral in the form of Cash is Transferred to the Pledgor
            pursuant to Paragraph 3(b); provided, however, that the obligation
            of Party B to Transfer any Interest Amount to Party A shall be
            limited to the extent that Party B has earned and received such
            funds and such funds are available to Party B. The last sentence of
            Paragraph 6(d)(ii) is hereby amended by adding the words "actually
            received by Party B but" after the words "Interest Amount or portion
            thereof".

      (iii) Alternative to Interest Amount. The provisions of Paragraph 6(d)(ii)
            (as amended herein) will apply.

      (iv)  Distributions. Paragraph 6(d)(i) shall be deleted in its entirety
            and replaced with the following:

            "Distributions. Subject to Paragraph 4(a), if Party B receives
            Distributions on a Local Business Day, it will Transfer to Party A
            not later than the following Local Business Day any Distributions it
            receives to the extent that a Delivery Amount would not be created
            or increased by that Transfer, as calculated by the Valuation Agent
            (and the date of calculation will be deemed to be a Valuation Date
            for this purpose)."

(i)   Additional Representation(s). There are no additional representations by
      either party.

(j)   Other Eligible Support and Other Posted Support.

      (i)   "Value" with respect to Other Eligible Support and Other Posted
            Support means: not applicable.

      (ii)  "Transfer" with respect to Other Eligible Support and Other Posted
            Support means: not applicable.

(k)   Demands and Notices. All demands, specifications and notices under this
      Annex will be made pursuant to the Notices Section of this Agreement,
      except that any demand, specification or notice shall be given to or made
      at the following addresses, or at such other address as the relevant party
      may from time to time designate by giving notice (in accordance with the
      terms of this paragraph) to the other party:

      If to Party A, at the address specified pursuant to the Notices Section of
      this Agreement.

      If to Party B, at the address specified pursuant to the Notices Section of
      this Agreement.

      If to Party B's Custodian: at the address specified pursuant to the
      Notices Section of this Agreement.

(l)   Address for Transfers. Each Transfer hereunder shall be made to the
      address specified below or to an address specified in writing from time to
      time by the party to which such Transfer will be made.

      Party A account details for holding collateral

       A/C With:                DB Trust Co. Americas, New York
       Swift Code:              BKTRUUS33 / ABA 021001033
       Favour of:               Deutsche Bank AG, New York
       Account Number:          01 473 969
       Reference:               N764066N

      Party B's Custodian account details for holding collateral:

                                Wells Fargo Bank, N.A.
       ABA Number:              121-000-248
       Account Number:          3970771416
       Account Name:            SAS Clearing
       Ref:                     53192902, WFMBS 2008-AR1 Credit Support Account

(m)   Other Provisions.

      (i)    Collateral Account. Upon notification, Party B or its Custodian
             shall establish and maintain a segregated account, and hold, record
             and identify all Posted Collateral in such segregated account.

      (ii)   Agreement as to Single Secured Party and Single Pledgor. Party A
             and Party B hereby agree that, notwithstanding anything to the
             contrary in this Annex, (a) the term "Secured Party" as used in
             this Annex means only Party B, (b) the term "Pledgor" as used in
             this Annex means only Party A, (c) only Party A makes the pledge
             and grant in Paragraph 2, the acknowledgement in the final sentence
             of Paragraph 8(a) and the representations in Paragraph 9.

      (iii)  Calculation of Value. Paragraph 4(c) is hereby amended by deleting
             the word "Value" and inserting in lieu thereof "Moody's Value,
             Fitch Value". Paragraph 4(d)(ii) is hereby amended by (A) deleting
             the words "a Value" and inserting in lieu thereof "a Moody's Value
             and a Fitch Value" and (B) deleting the words "the Value" and
             inserting in lieu thereof "Moody's Value and Fitch Value".
             Paragraph 5 (flush language) is hereby amended by deleting the word
             "Value" and inserting in lieu thereof "Moody's Value or Fitch
             Value". Paragraph 5(i) (flush language) is hereby amended by
             deleting the word "Value" and inserting in lieu thereof "Moody's
             Value and Fitch Value". Paragraph 5(i)(C) is hereby amended by
             deleting the word "the Value, if" and inserting in lieu thereof
             "any one or more of the Moody's Value or Fitch Value, as may be".
             Paragraph 5(ii) is hereby amended by (1) deleting the first
             instance of the words "the Value" and inserting in lieu thereof
             "any one or more of the Moody's Value or Fitch Value" and (2)
             deleting the second instance of the words "the Value" and inserting
             in lieu thereof "such disputed Moody's Value or Fitch Value". Each
             of Paragraph 8(b)(iv)(B) and Paragraph 11(a) is hereby amended by
             deleting the word "Value" and inserting in lieu thereof "least of
             the Moody's Value and Fitch Value".

      (iv)   Form of Annex. Party A and Party B hereby agree that the text of
             Paragraphs 1 through 12, inclusive, of this Annex is intended to be
             the printed form of ISDA Credit Support Annex (Bilateral Form -
             ISDA Agreements Subject to New York Law Only version) as published
             and copyrighted in 1994 by the International Swaps and Derivatives
             Association, Inc.

      (v)    Events of Default. Paragraph 7 will not apply to cause any Event of
             Default to exist with respect to Party B except that Paragraph 7(i)
             will apply to Party B solely in respect of Party B's obligations
             under Paragraph 3(b) of the Credit Support Annex. Notwithstanding
             anything to the contrary in Paragraph 7, any failure by Party A to
             comply with or perform any obligation to be complied with or
             performed by Party A under the Credit Support Annex shall only be
             an Event of Default if a Moody's Second Trigger Downgrade Event has
             occurred and is continuing and at least 30 Local Business Days have
             elapsed since such Moody's Second Trigger Downgrade Event first
             occurred.

      (vi)   Expenses. Notwithstanding anything to the contrary in Paragraph 10,
             the Pledgor will be responsible for, and will reimburse the Secured
             Party for, all transfer and other taxes and other costs involved in
             maintenance and any Transfer of Eligible Collateral.

      (vii)  Withholding. Paragraph 6(d)(ii) is hereby amended by inserting
             immediately after "the Interest Amount" in the fourth line thereof
             the words "less any applicable withholding taxes."

      (viii) Additional Definitions. As used in this Annex:

             "Custodian Required Rating Threshold" means, with respect to an
             entity, a long-term unsecured and unsubordinated debt rating from
             Fitch of "BBB" and a short-term unsecured and unsubordinated debt
             rating from Fitch of "F2".

             "Exposure" has the meaning specified in Paragraph 12, except that
             (1) after the word "Agreement" the words "(assuming, for this
             purpose only, that Part 1(f)(i)(A)-(E) of the Schedule is deleted)"
             shall be inserted and (2) at the end of the definition of Exposure,
             the words "with terms that are, in all material respects, no less
             beneficial for Party B than those of this Agreement" shall be
             added.

             "Fitch First Trigger Downgrade Event" means that no Relevant Entity
             has credit ratings from Fitch at least equal to the Fitch First
             Trigger Ratings Threshold.

             "Fitch Credit Support Amount" means, for any Valuation Date:

             (A)   if the Fitch Threshold for such Valuation Date is zero, an
                   amount equal to the sum of (1) 100.0% of the Secured Party's
                   Exposure for such Valuation Date and (2) the sum, for each
                   Transaction to which this Annex relates, of the product of
                   (i) the related Fitch Volatility Cushion for such
                   Transaction, (ii) the Scale Factor (as defined in the related
                   Confirmation), if any, for such Transaction or, if no Scale
                   Factor is applicable for such Transaction, one, and (iii) the
                   Notional Amount of such Transaction for the Calculation
                   Period of such Transaction which includes such Valuation
                   Date, and (iv) 105%, or

             (B)   if the Fitch Threshold for such Valuation Date is infinity,
                   zero.

             "Fitch Intermediate Ratings Threshold" means, with respect to Party
             A, the guarantor under an Eligible Guarantee, or an Eligible
             Replacement, a long-term unsecured and unsubordinated debt rating
             from Fitch of "BBB+" and a short-term unsecured and unsubordinated
             debt rating from Fitch of "F2".

             "Fitch Intermediate Trigger Downgrade Event" means that no Relevant
             Entity has credit ratings from Fitch at least equal to the Fitch
             Intermediate Ratings Threshold.

             "Fitch Valuation Percentage" means, for any Valuation Date and each
             item of Eligible Collateral, the corresponding percentage for such
             Eligible Collateral in the column headed "Fitch Valuation
             Percentage".

             "Fitch Value" means, on any date and with respect to any Eligible
             Collateral other than Cash, the product of (x) the bid price
             obtained by the Valuation Agent for such Eligible Collateral and
             (y) the Fitch Valuation Percentage for such Eligible Collateral set
             forth in paragraph 13(b)(ii).

             "Fitch Volatility Cushion" means, for any Transaction, 0.19%.

             "Local Business Day" means, for purposes of this Annex: any day on
             which (A) commercial banks are open for business (including
             dealings in foreign exchange and foreign currency deposits) in New
             York and the location of Party A, Party B and any Custodian, and
             (B) in relation to a Transfer of Eligible Collateral, any day on
             which the clearance system agreed between the parties for the
             delivery of Eligible Collateral is open for acceptance and
             execution of settlement instructions (or in the case of a Transfer
             of Cash or other Eligible Collateral for which delivery is
             contemplated by other means a day on which commercial banks are
             open for business (including dealings in foreign exchange and
             foreign deposits) in New York and in the location of Party A, Party
             B and any Custodian).

             "Moody's Credit Support Amount" means, for any Valuation Date:

             (A)   if the Moody's Threshold for such Valuation Date is zero and
                   (i) it is not the case that a Moody's Second Trigger
                   Downgrade Event has occurred and is continuing or (ii) a
                   Moody's Second Trigger Downgrade Event has occurred and is
                   continuing and less than 30 Local Business Days have elapsed
                   since such Moody's Second Trigger Downgrade Event first
                   occurred, an amount equal to the greater of (x) zero and (y)
                   the sum of the Secured Party's Exposure and the aggregate of
                   Moody's First Trigger Additional Amounts for all Transactions
                   and such Valuation Date;

             (B)   if the Moody's Threshold for such Valuation Date is zero and
                   a Moody's Second Trigger Downgrade Event has occurred and is
                   continuing and at least 30 Local Business Days have elapsed
                   since such Moody's Second Trigger Downgrade Event first
                   occurred, an amount equal to the greatest of (x) zero, (y)
                   the aggregate amount of the Next Payments for all Next
                   Payment Dates, and (z) the sum of the Secured Party's
                   Exposure and the aggregate of Moody's Second Trigger
                   Additional Amounts for all Transactions and such Valuation
                   Date; or

             (C)   if the Moody's Threshold for such Valuation Date is infinity,
                   zero.

             "Moody's First Trigger Additional Amount" means, for any Valuation
             Date and any Transaction, the product of (i) the applicable Moody's
             First Trigger Factor set forth in Table 1, (ii) the Scale Factor,
             if any, for such Transaction, or, if no Scale Factor is applicable
             for such Transaction, one, and (iii) the Notional Amount for such
             Transaction for the Calculation Period for such Transaction (each
             as defined in the related Confirmation) which includes such
             Valuation Date.

             "Moody's First Trigger Downgrade Event" means that no Relevant
             Entity has credit ratings from Moody's at least equal to the
             Moody's First Trigger Ratings Threshold.

             "Moody's First Trigger Value" means, on any date and with respect
             to any Eligible Collateral other than Cash, the bid price obtained
             by the Valuation Agent multiplied by the Moody's First Trigger
             Valuation Percentage for such Eligible Collateral set forth in
             Paragraph 13(b)(ii).

             "Moody's Second Trigger Additional Amount" means, for any Valuation
             Date and any Transaction, the product of (i) the applicable Moody's
             Second Trigger Factor set forth in Table 3, (ii) the Scale Factor,
             if any, for such Transaction, or, if no Scale Factor is applicable
             for such Transaction, one, and (iii) the Notional Amount for such
             Transaction for the Calculation Period for such Transaction (each
             as defined in the related Confirmation) which includes such
             Valuation Date.

             "Moody's Valuation Percentage" means, with respect to a Valuation
             Date and each item of Eligible Collateral,

             (A)   if the Moody's Threshold for such Valuation Date is zero and
                   (i) it is not the case that a Moody's Second Trigger
                   Downgrade Event has occurred and is continuing or (ii) a
                   Moody's Second Trigger Downgrade Event has occurred and is
                   continuing and less than 30 Local Business Days have elapsed
                   since such Moody's Second Trigger Downgrade Event first
                   occurred, the corresponding percentage for such Eligible
                   Collateral in the column headed "Moody's First Trigger
                   Valuation Percentage", or

             (B)   if a Moody's Second Trigger Downgrade Event has occurred and
                   is continuing and at least 30 Local Business Days have
                   elapsed since such Moody's Second Trigger Downgrade Event
                   first occurred, the corresponding percentage for such
                   Eligible Collateral in the column headed "Moody's Second
                   Trigger Valuation Percentage".

             "Moody's Value" means, on any date and with respect to any Eligible
             Collateral the product of (x) the bid price obtained by the
             Valuation Agent and (y) the applicable Moody's Valuation Percentage
             set forth in Paragraph 13(b)(ii).

             "Next Payment" means, in respect of each Next Payment Date, the
             greater of (i) the aggregate amount of any payments due to be made
             by Party A under Section 2(a) on such Next Payment Date less the
             aggregate amount of any payments due to be made by Party B under
             Section 2(a) on such Next Payment Date (any such payments
             determined based on rates prevailing the date of determination) and
             (ii) zero.

             "Next Payment Date" means each date on which the next scheduled
             payment under any Transaction is due to be paid.

             "Pricing Sources" means the sources of financial information
             commonly known as Bloomberg, Bridge Information Services, Data
             Resources Inc., Interactive Data Services, International Securities
             Market Association, Merrill Lynch Securities Pricing Service,
             Muller Data Corporation, Reuters, Wood Gundy, Trepp Pricing, JJ
             Kenny, Standard & Poor's, a division of The McGraw-Hill Companies,
             Inc. and Telerate.

             "Remaining Weighted Average Maturity" means, with respect to a
             Transaction, the expected weighted average maturity for such
             Transaction as determined by the Valuation Agent.

             "Transaction Exposure" means, for any Transaction, Exposure
             determined as if such Transaction were the only Transaction between
             the Secured Party and the Pledgor.

             "Transaction-Specific Hedge" means any Transaction that is (i) an
             interest rate swap in respect of which (x) the notional amount of
             the interest rate swap is "balance guaranteed" or (y) the notional
             amount of the interest rate swap for any Calculation Period (as
             defined in the related Confirmation) otherwise is not a specific
             dollar amount that is fixed at the inception of the Transaction,
             (ii) an interest rate cap, (iii) an interest rate floor or (iv) an
             interest rate swaption.

             "Valuation Percentage" shall mean, for purposes of determining the
             Moody's Value or Fitch Value with respect to any Eligible
             Collateral or Posted Collateral, the applicable Moody's Valuation
             Percentage or Fitch Valuation Percentage for such Eligible
             Collateral or Posted Collateral, respectively, in each case as set
             forth in Paragraph 13(b)(ii).

             "Value" shall mean, in respect of any date, the related Moody's
             Value and the related Fitch Value.

                [Remainder of this page intentionally left blank]

<PAGE>

                                     Table 1
                                     -------

                          Moody's First Trigger Factor
                          ----------------------------

                            Remaining                  Weekly
                      Weighted Average Life          Collateral
                        of Hedge in Years              Posting
                 1 or less                              0.25%
                 More than 1 but not more than 2        0.50%
                 More than 2 but not more than 3        0.70%
                 More than 3 but not more than 4        1.00%
                 More than 4 but not more than 5        1.20%
                 More than 5 but not more than 6        1.40%
                 More than 6 but not more than 7        1.60%
                 More than 7 but not more than 8        1.80%
                 More than 8 but not more than 9        2.00%
                 More than 9 but not more than 10       2.20%
                 More than 10 but not more than 11      2.30%
                 More than 11 but not more than 12      2.50%
                 More than 12 but not more than 13      2.70%
                 More than 13 but not more than 14      2.80%
                 More than 14 but not more than 15      3.00%
                 More than 15 but not more than 16      3.20%
                 More than 16 but not more than 17      3.30%
                 More than 17 but not more than 18      3.50%
                 More than 18 but not more than 19      3.60%
                 More than 19 but not more than 20      3.70%
                 More than 20 but not more than 21      3.90%
                 More than 21 but not more than 22      4.00%
                 More than 22 but not more than 23      4.00%
                 More than 23 but not more than 24      4.00%
                 More than 24 but not more than 25      4.00%
                 More than 25 but not more than 26      4.00%
                 More than 26 but not more than 27      4.00%
                 More than 27 but not more than 28      4.00%
                 More than 28 but not more than 29      4.00%
                 More than 29                           4.00%

<PAGE>

                                     Table 2
                                     -------

              Moody's Second Trigger Factor for Interest Rate Swaps
                           with Fixed Notional Amounts
              -----------------------------------------------------

                            Remaining                  Weekly
                      Weighted Average Life          Collateral
                        of Hedge in Years              Posting
                 1 or less                              0.60%
                 More than 1 but not more than 2        1.20%
                 More than 2 but not more than 3        1.70%
                 More than 3 but not more than 4        2.30%
                 More than 4 but not more than 5        2.80%
                 More than 5 but not more than 6        3.30%
                 More than 6 but not more than 7        3.80%
                 More than 7 but not more than 8        4.30%
                 More than 8 but not more than 9        4.80%
                 More than 9 but not more than 10       5.30%
                 More than 10 but not more than 11      5.60%
                 More than 11 but not more than 12      6.00%
                 More than 12 but not more than 13      6.40%
                 More than 13 but not more than 14      6.80%
                 More than 14 but not more than 15      7.20%
                 More than 15 but not more than 16      7.60%
                 More than 16 but not more than 17      7.90%
                 More than 17 but not more than 18      8.30%
                 More than 18 but not more than 19      8.60%
                 More than 19 but not more than 20      9.00%
                 More than 20 but not more than 21      9.00%
                 More than 21 but not more than 22      9.00%
                 More than 22 but not more than 23      9.00%
                 More than 23 but not more than 24      9.00%
                 More than 24 but not more than 25      9.00%
                 More than 25 but not more than 26      9.00%
                 More than 26 but not more than 27      9.00%
                 More than 27 but not more than 28      9.00%
                 More than 28 but not more than 29      9.00%
                 More than 29                           9.00%

<PAGE>

                                     Table 3
                                     -------

          Moody's Second Trigger Factor for Transaction-Specific Hedges
          -------------------------------------------------------------

                            Remaining                  Weekly
                      Weighted Average Life          Collateral
                        of Hedge in Years              Posting
                 1 or less                              0.75%
                 More than 1 but not more than 2        1.50%
                 More than 2 but not more than 3        2.20%
                 More than 3 but not more than 4        2.90%
                 More than 4 but not more than 5        3.60%
                 More than 5 but not more than 6        4.20%
                 More than 6 but not more than 7        4.80%
                 More than 7 but not more than 8        5.40%
                 More than 8 but not more than 9        6.00%
                 More than 9 but not more than 10       6.60%
                 More than 10 but not more than 11      7.00%
                 More than 11 but not more than 12      7.50%
                 More than 12 but not more than 13      8.00%
                 More than 13 but not more than 14      8.50%
                 More than 14 but not more than 15      9.00%
                 More than 15 but not more than 16      9.50%
                 More than 16 but not more than 17      9.90%
                 More than 17 but not more than 18     10.40%
                 More than 18 but not more than 19     10.80%
                 More than 19 but not more than 20     11.00%
                 More than 20 but not more than 21     11.00%
                 More than 21 but not more than 22     11.00%
                 More than 22 but not more than 23     11.00%
                 More than 23 but not more than 24     11.00%
                 More than 24 but not more than 25     11.00%
                 More than 25 but not more than 26     11.00%
                 More than 26 but not more than 27     11.00%
                 More than 27 but not more than 28     11.00%
                 More than 28 but not more than 29     11.00%
                 More than 29                          11.00%

<PAGE>

IN WITNESS WHEREOF, the parties have executed this Annex by their duly
authorized representatives as of the date of the Agreement.

DEUTSCHE BANK AG, NEW YORK BRANCH        WELLS FARGO BANK, N.A., NOT
                                         INDIVIDUALLY, BUT SOLELY AS MASTER
                                         SERVICER ON BEHALF OF THE SUPPLEMENTAL
                                         INTEREST TRUST IN RESPECT OF WELLS
                                         FARGO MORTGAGE BACKED SECURITIES
                                         2008-AR1 TRUST

By:   /s/ Audrey Kong                    By:   /s/ Stacey M. Taylor
   ---------------------------------        -----------------------------------
   Name:  Audrey Kong                       Name:  Stacey M. Taylor
   Title: Associate                         Title: Vice President
   Date:                                    Date:

DEUTSCHE BANK AG, NEW YORK BRANCH

By:   /s/ James Hill
   ---------------------------------
   Name:  James Hill
   Title: Assistant Vice President
   Date:

REFERENCE NUMBER:       N764066Nexv10w16

 

Exhibit 10.16

AMENDED AND RESTATED

SEVERANCE AND CHANGE IN CONTROL AGREEMENT

     This Amended and Restated Severance and Change in Control Agreement (the “Agreement”)
is made and entered into effective as of March 3, 2008, (the “Effective Date”), by and between
Anadys Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and Stephen T.
Worland, Ph.D. (the “Executive”). The Company and the Executive are hereinafter collectively
referred to as the “Parties”, and individually referred to as a “Party”. This Agreement shall
replace and supersede that certain Severance Agreement between Executive and the Company entered
into as of November 14, 2003 (the “Original Agreement”).

Recitals

     Whereas, Executive and the Company are currently parties to the Original Agreement
that is superseded and replaced in its entirety by this Agreement; and

     Whereas, the Company desires to continue to employ Executive to provide personal
services to the Company in that capacity, and wishes to provide Executive with certain severance
benefits in return for his services, and Executive wishes to be so employed and to receive such
benefits; and

     Whereas, the Company and Executive wish to enter into this Agreement to define their
mutual rights and duties with respect to Executive’s severance benefits;

     Now, Therefore, in consideration of the mutual promises and covenants contained
herein, and for other good and valuable consideration, the Parties, intending to be legally bound,
agree as follows:

Agreement

     1. Employment.

          1.1 Loyalty; At Will Employment. During the Executive’s employment by the Company, the
Executive shall devote Executive’s full business energies, interest, abilities and productive time
to the proper and efficient performance of Executive’s duties as an officer of the Company unless
otherwise approved in writing by the Board of Directors or a committee of the Board of Directors.
Executive’s employment with the Company is at will and not for any specified period and may be
terminated at any time, with or without cause, by either Executive or Company, subject to the
provisions of Sections 3 and 4 below.

          1.2 Termination of Obligations. In the event of the termination of the Executive’s employment
with the Company, the Company shall have no obligation to pay Executive any base salary, bonus or
other compensation or benefits, except as earned prior to the
date of termination or as provided in Section 3 or for benefits due to the Executive (and/or
the Executive’s dependents) under the terms of the Company’s benefit plans. To the extent
permitted by applicable laws, the Company may offset any amounts Executive owes it or its
subsidiaries against any amount it owes Executive pursuant to Section 3.

1.

 

          1.3 The term of this Agreement shall begin on the Effective Date and shall continue until
Executive’s employment with the Company is terminated for any reason.

     2. Definitions.

          For purposes of this Agreement, the following terms shall have the following meanings:

          2.1 Cause. “Cause” for the Company to terminate Executive’s employment hereunder shall mean
the occurrence of any of the following events:

               (i) the Executive’s willful or negligent failure, as determined in good faith by the Company’s
Board of Directors, to satisfactorily perform the Executive’s assigned duties with the Company, or
any successor thereof, in the best interests of the Company and as directed by the Company’s Board
of Directors (except for the failure resulting from Executive’s incapacity due to Complete
Disability, or any such actual or anticipated failure resulting from a Good Reason termination),
which is not corrected within thirty (30) days of Executive receiving notice of such failure from
the Company specifying in reasonable detail the nature of such failure;

               (ii) the Executive’s commission of a willful act that materially injures the business of the
Company;

               (iii) the Executive’s conviction of a felony involving moral turpitude; and

               (iv) the Executive’s engaging or in any manner participating in any activity that is directly
competitive with or injurious to the Company or any of its affiliates or which violates any
material provisions of the Executive’s Agreement for Employees dated March 22, 2001 (“Proprietary
Information and Inventions Agreement”) with the Company.

          2.2 Change in Control. For purposes of this Agreement, “Change in Control” means:

               (i) an acquisition by any person, entity or group within the meaning of Section 13(d) or 14(d)
of the Exchange Act, or any comparable successor provisions (excluding any employee benefit plan,
or related trust, sponsored or maintained by the Company or subsidiary of the Company or other
entity controlled by the Company) of the beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act, or comparable successor rule) of securities of the Company
representing more than fifty percent (50%) of the combined voting power of the Company’s then
outstanding securities other than by virtue of a merger, consolidation or similar transaction.
Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because the
level of ownership held by a person, entity or group exceeds the designated percentage threshold of
the outstanding voting securities as a result of a repurchase or other acquisition of voting securities by the
Company reducing the number of shares outstanding, provided that if a Change in Control would occur
(but for the operation of this sentence) as a result of the acquisition of voting securities by the
Company, and after such share acquisition, a person, entity or group becomes the owner of any
additional voting securities that, assuming the repurchase or other acquisition had not occurred,

2.

 

increases the percentage of the then outstanding voting securities owned by such person, entity or
group over the designated percentage threshold, then a Change in Control shall be deemed to occur;

               (ii) there is consummated a merger, consolidation or similar transaction involving (directly
or indirectly) the Company and, immediately after the consummation of such merger, consolidation or
similar transaction, the stockholders of the Company immediately prior thereto do not own, directly
or indirectly, outstanding voting securities representing more than fifty percent (50%) of the
combined outstanding voting power of the surviving entity in such merger, consolidation or similar
transaction or more than fifty percent (50%) of the combined outstanding voting power of the parent
of the surviving entity in such merger, consolidation or similar transaction; or

               (iii) there is consummated a sale or other disposition of all or substantially all of the
consolidated assets of the Company and its subsidiaries, other than a sale, lease, license or other
disposition of all or substantially all of the consolidated assets of the Company and its
subsidiaries to an entity, more than fifty percent (50%) of the combined voting power of the voting
securities of which are owned by stockholders of the Company in substantially the same proportions
as their ownership of the Company immediately prior to such sale, lease, license or other
disposition.

          2.3 Complete Disability. “Complete Disability” shall mean the inability of the Executive to
perform the Executive’s duties under this Agreement because the Executive has become permanently
disabled within the meaning of any policy of disability income insurance covering employees of the
Company then in force. In the event the Company has no policy of disability income insurance
covering employees of the Company in force when the Executive becomes
disabled, the term “Complete
Disability” shall mean the inability of the Executive to perform the Executive’s duties under this
Agreement by reason of any incapacity, physical or mental, which the Board, based upon medical
advice or an opinion provided by a licensed physician acceptable to the Board, determines to have
incapacitated the Executive from satisfactorily performing all of the Executive’s usual services
for the Company for a period of at least one hundred twenty (120) days during any twelve (12) month
period (whether or not consecutive). Based upon such medical advice or opinion, the determination
of the Board shall be final and binding and the date such determination is made shall be the date
of such Complete Disability for purposes of this Agreement.

          2.4 Good Reason. “Good Reason” means that Executive voluntarily terminates employment with
the Company (A) after (1) any of the following are undertaken without Cause and without Executive’s
express written consent; (2) Executive notifies the Company in writing, within thirty (30) days
after the occurrence of one of the following events, which notice specifies the condition giving
rise to a right to resign for Good Reason and that Executive intends to terminate his employment no
earlier than thirty (30) days after the Company’s receipt of such notice; and (3) the Company does not cure such condition within
thirty (30) days following its receipt of such notice or states unequivocally in writing that it
does not intend to attempt to cure such condition; and (B) such voluntary termination occurs within
ten (10) days following the end of the period within which the Company was entitled to remedy the
condition giving rise to a right to resign for Good Reason but failed to do so:

3.

 

               (i) a material adverse change in the nature or scope of Executive’s job responsibilities;

               (ii) the relocation (or demand for relocation) of Executive’s place of employment to a point
more than thirty (30) miles from Executive’s then current place of employment;

               (iii) a material reduction in the annual base compensation paid to Executive; or

               (iv) in the case of a Change of Control, the failure to be offered comparable employment with
the successor entity, provided that “comparable employment” shall mean employment with job
responsibilities not violative of Section 2.4(i), base salary in an amount not violative of Section
2.4(iii), and at a business office the location of which is not violative of Section 2.4(ii).

          2.5 Integration. The parties acknowledge that the definition of “for Cause” contained within
this Agreement may differ from the definitions of “for Cause” contained within Executive’s stock
option agreement or agreements. The Parties agree that unless it is determined that Executive
shall be terminated for “Cause” as defined in this Agreement, there shall be no termination for
“Cause” under any of Executive’s stock option agreements or other equity award agreements.
Therefore, unless otherwise expressly provided such equity award agreement, the definition of
“Cause” in this Agreement shall supersede and replace in its entirety any definition of “Cause”
that may be included in Executive’s equity award agreements.

     3.
Compensation Upon
Termination.

          3.1 Death Or Complete Disability. If the Executive’s employment with the Company is
terminated as a result of death or Complete Disability, the Company shall pay to Executive, and/or
Executive’s heirs, the Executive’s base salary and accrued and unused vacation benefits earned
through the date of termination at the rate in effect at the time of termination, less standard
deductions and withholdings, and the Company shall thereafter have no further obligations to the
Executive and/or Executive’s heirs under this Agreement.

          3.2 With Cause or Without Good Reason. If the Executive’s employment with the Company is
terminated by the Company for Cause or if the Executive terminates employment with the Company
without Good Reason, the Company shall pay the Executive’s base salary and accrued and unused
vacation benefits earned through the date of termination at the rate in effect at the time of
termination, less standard deductions and withholdings, and the Company shall thereafter have no
further obligations to the Executive under this Agreement.

          3.3 Without Cause or for Good Reason. In the event Executive’s employment with the Company is terminated by the Company without Cause, or Executive resigns
for Good Reason, and Executive signs the Release and Waiver of Claims as set forth as Exhibit A or
such other form of release as the Company may require in order to comply with applicable laws (the
“Release”) on or within the time period set forth therein, but in no event later than forty-five
(45) days after Executive’s termination date, and allows such Release to

4.

 

become effective in accordance with its terms, then Executive will receive the following benefits:

               (i) the equivalent of twelve (12) months of the Executive’s annual Base Salary (as defined
herein), less standard deductions and withholdings, which shall be paid in a single lump sum within
five (5) days after the effective date of the Release. “Base Salary” shall mean Executive’s base
pay (excluding incentive pay, premium pay, commissions, overtime, bonuses and other forms of
variable compensation), at the rate in effect during the last regularly scheduled payroll period
immediately preceding the date of the termination, and prior to any reduction in base salary that
would permit the Executive to voluntarily terminate employment pursuant to Section 2.4(iii).

               (ii) If Executive is eligible for and timely elects continued group health plan coverage under
the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) following Executive’s
termination, the Company will pay the Executive’s COBRA group health insurance premiums for the
Executive and his eligible dependents for a period of twelve (12) months following the effective
date of the Release; provided, however, that any such payments will cease if Executive voluntarily
enrolls in a health insurance plan offered by another employer or entity during the period in which
the Company is paying such premiums. Executive is required to immediately notify the Company in
writing of any such enrollment. For purposes of this Section 3.3(ii), references to COBRA premiums
shall not include any amounts payable by Executive under an Internal Revenue Code Section 125
health care reimbursement plan.

               (iii) The Company will make available to Executive, upon Executive’s request, executive
outplacement services provided by a reputable outplacement firm for a period of six (6) months
following the effective date of the Release. The Company will assume the cost of all such
outplacement services.

               (iv) As of the effective date of the Release, all of the outstanding equity awards that
Executive holds and which were granted to Executive within one year prior to Executive’s
termination date shall accelerate and vest in accordance with the vesting schedule applicable to
such equity award as if Executive had provided 12 months of vesting service as of Executive
termination date and, together with all other vested equity awards which Executive holds, if
applicable, will remain exercisable until the earlier of: (i) fifteen (15) months following
Executive’s termination date, (ii) ten (10) years from the original grant date, (iii) the original
maximum term of such equity award, or (iv) the effective date of a Change in Control in which such
awards will terminate and not be assumed by the successor or acquiring entity. In addition, all of
Executive’s outstanding restricted stock and other equity awards which Executive holds as of the
termination date and which were granted to Executive within one year prior to Executive’s
termination date shall accelerate and vest as of the effective date of the Release, in accordance
with the vesting schedule applicable to such equity awards as if Executive had provided 12 months
of vesting service as of Executive’s termination date.

          3.4 Additional Change in Control Related Severance Benefits. In the event that Executive’s
employment with the Company is terminated without Cause or Executive resigns for Good Reason within
the six (6) month period immediately preceding or the twenty-

5.

 

four (24) month period immediately following a Change in Control of the Company, then subject to the Executive’s delivery to the
Company of an effective Release as required pursuant to Section 3.3, in addition to the severance
benefits provided to Executive under Section 3.3(i), 3.3(ii) and 3.3(iii) above, the Executive
shall also be entitled to the following benefits:

               (i) A pro-rata portion of Executive’s 100% Bonus Opportunity Amount (as defined herein), which
pro-rata portion shall be calculated by multiplying Executive’s 100% Bonus Opportunity Amount by
the quotient of the number of days in the calendar year that have elapsed as of the date of
Executive’s termination divided by 365 (the “Bonus Payment”). Executive’s “100% Bonus Opportunity
Amount” shall be determined by reference to the then-current provisions of the Anadys
Pharmaceuticals, Inc. Executive Officer Bonus Plan as applicable to the calendar year in which the
Executive’s employment has terminated. The Bonus Payment shall be subject to all standard
deductions and withholdings and shall be paid in a single lump sum within five (5) days after the
later of (A) the effective date of the Release, or (B) the effective date of the Change in Control
(if Executive’s termination occurs prior to the Change in Control); and

               (ii) Full accelerated vesting of all unvested shares subject to any outstanding stock options,
restricted stock or other equity awards then held by Executive, such that all shares shall be
vested and fully exercisable as of the effective date of the Release, or if later, the effective
date of the Change in Control (if Executive’s termination occurs prior to the Change in Control).
In order to give effect to the foregoing provision, notwithstanding anything to the contrary set
forth in Executive’s equity award agreements, following any termination of Executive’s employment
that is without Cause or for Good Reason, none of Executive’s equity awards shall terminate with
respect to any vested or unvested portion subject to such award before the later of (A) six (6)
months following such termination, or (B) the effective date of the Release.

     4.
Change in Control Related Benefit

          4.1 Pursuant to the Executive’s stock option grant dated April 12, 2001 (the “Hire Grant”),
upon a Change in Control of the Company all shares under the Hire Grant shall be vested and fully
exercisable in accordance with the terms thereof.

     5. Tax Compliance

          5.1 Application of Internal Revenue Code Section 409A. The severance benefits payable under
this Agreement are intended to be payable pursuant to the “short-term deferral” rule set forth in
Section 1.409A-1(b)(4) of the Treasury Regulations.

          5.2 Parachute Payment. If any payment or benefit Executive would receive pursuant a Change in
Control or otherwise (“Payment”) would (i) constitute a “parachute payment” within the meaning of
Section 280G of the Code, and (ii) but for this sentence, be
subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then such
Payment shall be reduced to the Reduced Amount. The “Reduced Amount” shall be either (x) the
largest portion of the Payment that would result in no portion of the Payment being subject to the
Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever

6.

 

amount, after taking into account all applicable federal, state and local employment taxes, income
taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in
Executive’s receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding
that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in
payments or benefits constituting “parachute payments” is necessary so that the Payment equals the
Reduced Amount, reduction shall occur in the following order unless Executive elects in writing a
different order (provided, however, that such election shall be subject to Company approval if made
on or after the effective date of the event that triggers the Payment): reduction of cash payments;
cancellation of accelerated vesting of stock awards; reduction of employee benefits. In the event
that acceleration of vesting of stock award compensation is to be reduced, such acceleration of
vesting shall be cancelled in the reverse order of the date of grant of Executive’s stock awards
unless Executive elects in writing a different order for cancellation.

     The Company shall engage a nationally recognized accounting or consulting firm to perform the
foregoing calculations. If the firm so engaged by the Company is serving as accountant or auditor
for the individual, entity or group effecting the Change in Control, then the Company shall appoint
another nationally recognized accounting or consulting firm to make the determinations required
hereunder. The Company shall bear all expenses with respect to the determinations by such firm
required to be made hereunder.

     The firm engaged to make the determinations hereunder shall provide its calculations, together
with detailed supporting documentation, to Executive and the Company within fifteen (15) calendar
days after the date on which Executive’s right to a Payment is triggered (if requested at that time
by Executive or the Company) or such other time as requested by Executive or the Company. If the
firm determines that no Excise Tax is payable with respect to a Payment, either before or after the
application of the Reduced Amount, it shall furnish Executive and the Company with an opinion
reasonably acceptable to Executive that no Excise Tax will be imposed with respect to such Payment.
Any good faith determinations of the firm made hereunder shall be final, binding and conclusive
upon Executive and the Company.

     6. Company Property. All documents, records, apparatus, equipment and other physical
property that is furnished to or obtained by Executive in the course of his employment with the
Company shall be and remain the sole property of the Company. Executive agrees that, upon the
termination of his employment, as a condition of receiving benefits under this Agreement, he shall
return all such property (whether or not it pertains to “Proprietary Information” as defined in the
Proprietary Information and Inventions Agreement), and agrees not to make or retain copies,
reproductions or summaries of any such property.

     7.
Other Terminations. Notwithstanding anything to the contrary set forth
herein, the Executive is not eligible for severance benefits under this Agreement if (i) the
Executive is terminated within thirty (30) days following the Executive’s refusal to accept an
offer of comparable employment by any successor to the Company or an affiliate thereof
(provided that “comparable employment” shall mean employment with job responsibilities not
violative of Section 2.4(i), base salary in an amount not violative of Section 2.4(iii), and at a
business office the location of which is not violative of Section 2.4(ii)); (ii) the Executive
terminates employment in order to accept employment with another entity that is wholly or

7.

 

partly
owned (directly or indirectly) by the Company or an affiliate, (iii) the Executive does not satisfy
the conditions for receipt of benefits as set forth in Sections 3.3 and 6 of this Agreement; or
(iv) the Executive’s employment terminates due to death, Complete Disability or any other reason
other than a termination without Cause or for Good Reason.

     8. Acknowledgement. Executive hereby acknowledges that Executive has
consulted with or has had the opportunity to consult with independent counsel of Executive’s own
choice concerning this Agreement, and has been advised to do so by the Company, and Executive has
read and understands this Agreement, is fully aware of its legal effect, and has entered into it
freely based on Executive’s own judgment.

     9. General. This Agreement is made in San Diego, California. This Agreement
shall be construed and interpreted in accordance with the internal laws of the State of California.
This Agreement supersedes and replaces any other agreement between Executive and the Company
regarding severance benefits and/or compensation upon termination of employment, including but not
limited to the Original Agreement, and cannot be amended or modified except by written agreement
between Executive and the Company. This Agreement may be executed in two counterparts, each of
which shall be deemed an original, all of which together shall contribute one and the same
instrument.

     In Witness Whereof, the Parties have executed this Agreement as of the date first
above written.

	 	 	 	 	 
	Anadys Pharmaceuticals, Inc.

 	 	 
	 	By:  	 Douglas E. Williams, Ph.D.
 	 
	 	 	Chairman, Compensation Committee 	 

Dated: March 3, 2008

	 	 	 	 	 
	Executive:

 	 	 
	/s/ Stephen Worland
 	 	 
	Stephen T. Worland 	 	 
	 	 	 

Dated: March 3, 2008

8.

 

EXHIBIT A

RELEASE AND WAIVER OF CLAIMS

     In consideration of the payments and other benefits set forth in the Change in Control
Agreement dated March 3, 2008 to which this form is attached, I, Stephen T. Worland, Ph.D., hereby
furnish Anadys Pharmaceuticals, Inc. (the “Company”), with the following release and
waiver (“Release and Waiver”).

     In exchange for the consideration provided to me by the Change in Control Agreement that I am
not otherwise entitled to receive, I hereby generally and completely release the Company and its
directors, officers, employees, shareholders, partners, agents, attorneys, predecessors,
successors, parent and subsidiary entities, insurers, Affiliates, and assigns from any and all
claims, liabilities and obligations (excluding indemnification obligations and rights under the
Company’s directors and officers insurance policies) both known and unknown, that arise out of or
are in any way related to events, acts, conduct, or omissions occurring prior to my signing this
Release and Waiver. This general release includes, but is not limited to: (1) all claims arising
out of or in any way related to my employment with the Company or the termination of that
employment; (2) all claims related to my compensation or benefits from the Company, including, but
not limited to, salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay,
fringe benefits, stock, stock options, or any other ownership interests in the Company; (3) all
claims for breach of contract, wrongful termination, and breach of the implied covenant of good
faith and fair dealing; (4) all tort claims, including, but not limited to, claims for fraud,
defamation, emotional distress, and discharge in violation of public policy; (5) all federal,
state, and local statutory claims, including, but not limited to, claims for discrimination,
harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights
Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age
Discrimination in Employment Act of 1967 (as amended) (“ADEA”), and the California Fair Employment
and Housing Act (as amended).

     I also acknowledge that I have read and understand Section 1542 of the California Civil Code
which reads as follows: “A general release does not extend to claims which the creditor does not
know or suspect to exist in his or her favor at the time of executing the release, which if known
by him or her must have materially affected his or her settlement with the debtor.” I hereby
expressly waive and relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to any claims I may have against the Company.

9.

 

     I acknowledge that, among other rights, I am knowingly and voluntarily waiving and releasing
any rights I may have under ADEA. I also acknowledge that the consideration given for this Release
and Waiver is in addition to anything of value to which I was already entitled as an Employee of
the Company. If I am 40 years of age or older upon execution of this Release and Waiver, I further
acknowledge that I have been advised by this writing, as required by the Older Workers Benefit
Protection Act, that: (A) my release and waiver granted herein does not relate to claims under the
ADEA that may arise after the date I execute this Release and Waiver; (B) I should consult with an
attorney prior to executing this Release and Waiver (although I may choose voluntarily not to do
so), (C) I have twenty-one (21) days to consider this Release and Waiver (although I may choose to
voluntarily execute this Release and Waiver earlier); (D) I have seven (7) days following the
execution of this Release and Waiver to revoke the Release and Waiver; and (E) this Release and
Waiver shall not be effective until the seven (7) day revocation period has expired unexercised.

     If I am less than 40 years of age upon execution of this Release and Waiver, I acknowledge
that I have the right to consult with an attorney prior to executing this Release and Waiver
(although I may choose voluntarily not to do so); and I have five (5) days from the date of
termination of my employment with the Company in which to consider this Release and Waiver
(although I may choose voluntarily to execute this Release and Waiver earlier).

     I acknowledge my continuing obligations under my Agreement for Employees dated March 22, 2001
(“Proprietary Information and Inventions Agreement”), which is attached hereto. Pursuant to my
Proprietary Information and Inventions Agreement I understand that among other things, I must not
use or disclose any confidential or proprietary information of the Company and I must immediately
return all Company property and documents (including all embodiments of proprietary information)
and all copies thereof in my possession or control. I understand and agree that my right to the
severance benefits I am receiving in exchange for my agreement to the terms of this Release and
Waiver is contingent upon my continued compliance with my Proprietary Information and Inventions
Agreement.

     This Release and Waiver, including the Proprietary Information and Inventions Agreement
attached hereto, constitutes the complete, final and exclusive embodiment of the entire agreement
between the Company and me with regard to the subject matter hereof. I am not relying on any
promise or representation by the Company that is not expressly stated herein. This Release and
Waiver may only be modified by a writing signed by both me and a duly authorized officer of the
Company.

	 	 	 	 	 
	 	 	 
	Date: __________________   	By:  	
 	 
	 	 	 	 
	 	 	 	 
	 

10.

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